CrossCheck Compliance Adds BasePoint FraudMark® Score to Reinvent Loan Due Diligence

Integrates pattern recognition technology to identify fraud risk before purchase/funding

BasePoint Analytics™, a leading provider of scientific fraud analytics and consulting services, today announced that CrossCheck Compliance has selected BasePoint’s FraudMark® solution as a core component in their new approach to due diligence for loan and portfolio purchases. CrossCheck executives, being veterans in the mortgage market, have long seen a need to rebuild the due diligence done on loan and portfolio purchases. CrossCheck along with BasePoint has completely re-engineered the process starting with advanced pattern recognition analytics to correctly assess risk of individual loans and portfolio segments, creating loan sample sets that exhibit the highest risk of loss due to fraud, compliance and credit. These target rich sample sets with tracked metrics will be used for smart, dynamic, and in some cases forensic review processes based on the outcomes of the analytic technology applied on the front end with pattern recognition analytics such as the FraudMark score. CrossCheck clients will be able to see precise targeting with sampling, including FraudMark’s industry leading low false positives, as well as conclusive results from comprehensive review processes from highly trained review analysts using forensic loan review methods. Over the past year, the FraudMark score has helped due diligence firms, investors and lenders prevent over $2 billion in suspicious loans.

“The CrossCheck business model is based on a new approach to operational risk management grounded in a strong overall quality control and compliance discipline. Our use of the BasePoint FraudMark score enables us to expedite the process of confirming if losses are likely due to fraud,” said Loren Morris, Managing Director at CrossCheck Compliance. “We chose to work with BasePoint because their solutions are among the best at fraud detection and fit well with our holistic approach to creating and sustaining the integrity of mortgage lending. After extensive testing and use of other solutions over our years in the industry, we have found that BasePoint’s pattern recognition analytics are a truly unique approach that works. It allows us to review all targeted loans for possible fraud, not just a small sample. Coupled with skilled hands-on review by seasoned professionals, as well as other verifications, we believe we can bring common sense back to the mortgage lending process.”

The FraudMark solution uses sophisticated analytic scoring technology to identify suspicious mortgage loans, facilitating quick and effective due diligence on high risk loans before purchase or funding. The models accurately predict the likelihood of a loan containing fraud that will result in financial loss to the investor/lender. The FraudMark score risk ranks all loans to create a highly targeted subset of loans for the Enhanced Fraud Review. The precise fraud score provided by FraudMark, with market leading low false positive ratios, results in high detection of fraud with minimal operational impact. BasePoint’s specialized fraud review process substantially speeds up the confirmation of misrepresentations in high risk loans, providing real savings to clients.

“As the mortgage industry looks to rebuild on a strong operational risk management foundation, CrossCheck’s proactive approach to stopping fraud positions them as a leader in due diligence services,” said Tim Grace, president and CEO of BasePoint. “CrossCheck’s adoption of BasePoint’s FraudMark solution and our on-going partnership results in a unique offering for the market. It enables the secondary market and lenders the ability to score their risk with BasePoint’s highly advanced scoring models to create target rich samples of loans needing review. The loop is then closed with highly trained risk management professionals to conclusively vet each loan before purchase, or funding in a lender’s case. As the market rebuilds, the combined service should be one that is used by both the secondary market and lenders themselves. The precise targeting analytics,

smart review process and resulting loss mitigation will be the new benchmark for operational risk management processes in the industry.”

About CrossCheck Compliance

CrossCheck Compliance is a professional services firm providing regulatory compliance and due diligence services to banks and mortgage lenders. CrossCheck enhances clients' business performance by delivering operational risk management solutions including professional resources, project management, consultation, and trusted advisory services. The management team’s strong foundation in risk management provides clients with the top-down perspective needed to effectively deal with the ever changing and increasingly strict regulatory environment. CrossCheck’s clients benefit from their deep expertise in industry compliance and a solid internal audit and control foundation. CrossCheck is headquartered in Chicago, Illinois. Additional information is available at www.crosscheckcompliance.com or call 1-312-346-4600.

About BasePoint

BasePoint Analytics is a leading provider of predictive analytic fraud and risk management solutions for global banks and the mortgage industry. Using proprietary pattern-recognition technology, BasePoint quickly identifies potentially fraudulent or high risk activity, minimizing losses while accelerating the processing of non-risky records. The company’s fraud experts have deep, realworld domain expertise and have successfully solved fraud and risk challenges for many high profile lending institutions. BasePoint works with industry-leading customers in mortgage origination, investment banking and payment cards, including MasterCard Worldwide. BasePoint clients achieve dramatic improvements in fraud and loss detection performance using a predictive analytic approach rather than traditional methods. BasePoint is headquartered in Carlsbad, California, and has a strategic partnership with First American CoreLogic. For more information, visit

www.basepointanalytics.com or call 1-760-602-4971.