Fannie Mae Overpaid Servicers $89 Million in 2012


Here’s a way to greatly reduce overpayments to servicers. Write the contract with Accenture so that they are responsible for any overpayments that occur.  The way it is now Accenture can hire people at relative low pay, barely train them and if they screw up and cost the taxpayers millions of dollars it doesn’t matter. Another question to ask is if Fannie Mae is overpaying by this much what is Freddie Mac doing? Please read the article below.

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The Office of the Inspector General of the Federal Housing Financing Agency (FHFA) has issued a report finding that Fannie Mae overpaid mortgage servicers approximately $89 million in expenses related to default servicing in 2012. Fannie Mae outsources its reimbursement review process to management consulting firm Accenture.

The FHFA’s inspector general found that Accenture employees, who manually process the vast majority of claims, made errors because of “(1) inconsistent application of guidelines by different reviewers, (2) limited resources devoted to avoiding such inconsistencies, (3) complex subject matter, and (4) large volume of servicer claims.”

Examples of overpayment of claims included duplicate claims that are reviewed by different processors and fraudulent claims. Because underpayments are almost always noticed and reported by the servicers, there are far fewer underpayments than overpayments. “Fannie Mae has no remedial measures to recover overpayments on 99 percent of claims because it only samples 1 percent of claims for accuracy,” the report said.

“Alternatively, when a servicer is underpaid, it often contacts Fannie Mae to discuss the underpayment and resubmits the claim at no additional cost. Because of this asymmetry, netting overpayments and underpayments does not accurately represent the financial loss that Fannie Mae incurs because of Accenture errors.”

To read the complete article please use the link below.

Fannie Mae Overpaid Servicers

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