Whenever there's an economic downturn, crime goes up. The explanation is pretty simple: When money is flowing freely and jobs are plentiful, the risks of getting caught engaging in a crime outweigh the rewards. But when money dries up and jobs disappear, local police departments consistently report that crimes of almost all types rise, and especially those involving any sort of potential financial gain.
But before you go adding deadbolts and using a hacksaw to chop off the barrel of that new shotgun, realize that I'm not thinking right now about the kind of crime that involves thugs in masks kicking down your door. I'm more worried about pointing your attention to the kind of crime perpetrated by men and women in suits and ties, sitting behind computers in offices, directed squarely at you and me.
No, I'm not talking about Wall Street, either. (It's sad when that's the first thought that comes to many minds.)
Classic fraud and cyber crime are moving into the appraisal industry and the technology business at breakneck speed, affecting all of us dramatically. The schemes run the gamut from appraisal directories claiming to send you work if you just prepay a few hundred dollars for your listing - and then you never hear from them again - to more sophisticated computer-based crimes involving grabbing your signature and altering your reports.
The latter is the biggest reason why our new Armstrong version of WinTOTAL (Click here for more info.) includes our secure SureDocs digital signature and document escrowing technology, even in its first "scaled down" release. Top-flight security with real authentication isn't something that's optional anymore - it's a core required feature. Appraisal identity theft is real, it's serious, and it won't be solved just by adding a password to your PDF.
Of course, these sorts of criminals don't stop at stealing just appraisers' property; we see it too. We constantly find companies trying to harvest our customer lists for their gain by stealing names from our XSite Network, in clear violation of the posted legal notices. And it's not limited to oddballs either. You'd be surprised at the well-known firms who've tried it and gotten caught.
Some attempts are much more brazen. We recently saw a job posting on a well-known national freelancing site specifically seeking programmers who could clone our products and steal our property. And in the converse situation, we got an offer from a former executive to "find" confidential information from his days at Day One and Appraisal.com. (We promptly provided all the details to ACI so they could protect their asset.)
Many of you also know that there are some shady appraisal management companies popping up these days as a result of the HVCC debacle. Some of the worst characters of the prior flipping bubble, including former high-pressure lenders and former appraisers with revoked licenses, have simply decided to set up shop anew as unregulated, unlicensed, and unrestricted appraisal management companies. A recent BusinessWeek article even touched on that issue, but it shouldn't take a national business publication to point it out. Just be careful as you evaluate potential management companies.
Times may be tough and the temptation to jump on a new order thrown your way may be great, but with fraudulent or unethical management companies on the rise, be sure to exercise caution. Do some due diligence and ask around first before taking assignments from a company that may place your license in jeopardy, or simply not pay you.
The best place to ask others about their experiences with regard to any sort of potential fraud or crime is on the independent WinTOTAL User's Group on Yahoo, founded and run by Brian Davis. It's the largest, most professional, and most active appraisal group out there. You'll get prompt, concrete, candid responses to any questions you post about clients, security, fraud, or any other topic. You can visit Brian's XSite for details on joining the group www.OurAppraisal.com/WinTOTALUsersGroup. While you're at it, also check out Brian's excellent appraisal news website at www.AppraisalScoop.com.
No, he didn't pay me behind the scenes for that plug. That would be Wall Street-style fraud... or, as it's more commonly known today, a "bailout".