How a bank investigator used Thomson Reuters CLEAR to discover the truth about a man with two lives.
It’s a bank’s nightmare. A borrower takes out a business loan for millions of dollars, then suddenly stops paying. When the bank probes for answers, the borrower won’t return calls or emails. Should the bank take a loss on the unrecovered loan, the hit to their balance sheet would be substantial.
Not long ago, a large Midwestern community bank faced this problem. To locate their missing borrower, they hired Cendrowski Corporate Advisors, a firm that works with attorneys and legal teams to specialize in forensic accounting and fraud investigation services. Using Thomson Reuters CLEAR online investigative software, investigator Theresa Mack uncovered the truth—that the borrower was someone far different from who he’d presented himself to be.
The man with two lives
Mack started her investigation with what the bank had: the borrower’s name, payment records, Social Security number and contact information. Before making the loan, the bank had used a third-party firm to verify the borrower’s SSN was valid.
Using CLEAR, she entered this information and pulled all addresses associated with the data. The dashboard tool gave her ranked and rated results, quickly assembling a comprehensive picture of the borrower. One address in these results caught her attention. “It was an address that belonged to a name that was similar to this person’s, but who had a different Social Security number,” she said.
Running this new name on CLEAR, Mack discovered this person “had a whole identity.” While the new person had a different SSN from the borrower, and his name was slightly different, there were telling similarities between the two identities.
Using CLEAR to map out a dual past
Mack sketched out the two individuals—the bank’s missing borrower, “Person A”, and “Person B,” the person with similar biographical details.
She was able to run separate CLEAR searches for both individuals and compare the two. Each man had a similar story: someone who amassed large debts from a number of banks, purchased commercial properties, collected rent from tenants, and defaulted on his loan obligations.
Contacting the bankruptcy trustee who handled Person B’s case convinced Mack that the individuals “were one and the same person because of the similarities. The date of birth matched, the name of the spouse matched.”
However, she might not have discovered the borrower’s alternate identity except for the old address that she found via CLEAR. “That’s what linked it, that one address—he slipped up.”
Making the case for fraud
Mack was surprised that the due diligence firm the bank had used hadn’t seen any red flags when verifying the borrower’s identity due to CIP protocols. She learned they were a third-party firm that only charged $100 for identity verification. The bank has since upgraded its due diligence efforts.
When the fraudulent borrower had filed for bankruptcy 15 years ago and had assumed a new identity, it was easier to pull off his scheme. In the past, Social Security didn’t regularly communicate with credit bureaus, which made SSN fraud harder to detect. “Not long ago, you could make up a Social Security number, put it on the shelf and backstop it,” Mack said. “Just make it look like it’s real and keep it dormant until you need it. That’s what I think he did here.”
Resolving the case
Armed with Mack’s information, the bank went to court to claim they’d been defrauded by a borrower using a false identity and false Social Security information. It turns out that at least ten other banks had lent to the same borrower. By getting into court first, the community bank was “able to get a judgment against him and collect,” Mack said.
It’s unclear whether the fraudulent borrower’s other lenders will be as successful in their quest for restitution. Luckily for the community bank, they hired an investigator with extensive experience and who, by using CLEAR, could thoroughly assess even the most unassuming-seeming leads.
“CLEAR provided me with the necessary link that steered me to the true person, to his true identity,” said Mack.
Learn how Thomson Reuters CLEAR investigation tool can aid your business in identifying fraudulent information. Visit legalsolutions.com/clear.
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