I have worked as a reviewer/consultant on many cases. I have seen many appraisers get disciplined by state boards. I have seen people in mortgage fraud cases get jail time. I have never seen an appraiser punished for fraudulent report alteration done by someone else.
That depends on your definition of "punished." Numerous appraisers have been blacklisted for reports they never wrote. Numerous appraisers have had to defend a fraudulent report in front of their state board and prove it wasn't theirs. Such defense is onerous - I call that punishment.
We have been brainwashed into using "locked" PDF files as the standard, even though they offer no real security. One forumite challenged me on this claim. He emailed me a "locked" PDF. I emailed it back two minutes later unlocked. For our own protection, we need to embrace and use real digital signatures and get away from the illusion of security offered by Adobe's password system.
Neither do the portals or AMC's or any of the conversion programs. Their only usefulness is to provide alteration. I have seen altered Lighthouse reports - and recently, an altered AIReady report. And then there is Mr Hicks post under Clients, Good, Bad and Ugly about Flagstar and their pet AMC and an altered report.
As for the bigger picture, a large part of the blame is rightfully placed on unethical appraisers. You can't get an inflated appraisal report unless you have an unethical (or incompetent) appraiser.
Sure you can - you just have to rearrange a little data in that conversion program or the unlocked report given to the loan officer or processor, reapply the appraisers signature and VOILA - the report they want.
Blame also lies with states who treat fees from appraiser licensing as "general funds" rather than using the money to actually regulate appraisers. A few years ago our licensing fee doubled, yet the staff of our appraisal commission has been reduced from 4 people to 1 person.
Agreed - and more states need to hold their disciplinary hearings in full public view and not behind closed doors.
Blame lies with Congress for not giving the ASC the authority it needs to truly regulate. If judges and juries in criminal courts could impose only the death penalty, then "minor crimes" such as wreckless driving, assault, robbery, etc. would be widespread because we all know that no one would get the death penalty for those offenses. Yet Congress thought a system like that would work for oversight of state boards.
The ASC had their chance - it is time for the states to take over their own duties. It is time for the states to protect their own citizens and not depend on an organization who can't seem to settle on which version of USPAP is appropriate.
Perhaps the biggest single factor in the current problem is that lenders are not held accountable for the loans they make. This has really led to virtually everything else.
It seems like ancient history now, but in the days when lenders where lending their own money and not just packing deals to sell to investors, they were a lot more concerned with the quality of those loans.
I am in total agreement with those statements. Numerous folks in this thread have suggested it is time to make these lenders hold the paper for some period of time. That would go a long way to curbing fraud and the issuance of shaky loans.
