Hidden Images

By Lisa A. Tyler
National Escrow Administrator

In the March 2007 issue of Fraud Insights we published the story entitled, "Fraud Detection Technology," which described how one of our employees detected a fraudulent I.D. by using Fraud Fighter UV counterfeit detector model UV-16. Since then, several of our offices have ordered their own black boxes. This, coupled with the I.D. Checking Guides, has proven to be successful in stopping fraud. In this issue of Fraud Insights, read the story "Hidden Images" to learn about the hidden images contained on state-issued driver's licenses, as well as tips on what steps to take if presented with a fake identification card.

In last month's edition of Fraud Insights, we left you with a real cliff hanger. Bank of America® failed to freeze the seller's line of credit and just prior to closing the seller withdrew $254,000 against the available balance and transferred the funds to her checking account. Find out what happened to our villain and victims, the Fidelity National Title Tampa, Fla. operation and Bank of America in "International Espionage - Part II."

This month's fraud detection reward goes to Linda Chrisman, a branch manager and bulk sales specialist for FNT's San Francisco office. Find out how Linda detected a fake "official check" deposited into her escrow and saved the Company from a $430,000 loss in "Black Tarzan, LLC."

Are you getting inundated with the hard copy version of Fraud Insights? Our goal is to send only one per employee per operation. If you are receiving more than needed, please let us know by sending a quick e-mail to settlement@fnf.com. If you are an agency representative and you would like to increase or reduce your number of hard copies, simply e-mail us as well and let us know how many copies you would like to receive.



Hidden Images

Find out what images the UV light reveals when used on the driver's licenses of 40 different states, including the District of Columbia. These tips prevent our employees from closing, and the Company from insuring, real estate transactions involving fake identification.

The I.D. Checking Guide, produced by the Drivers License Guide Company, provides a description of the driver's licenses or identification cards for each state or U.S. Territory, as well as other federal identification pieces, including military I.D. cards. Each category also includes a validation paragraph to explain the various features one should look for to determine the validity of an I.D. These features might include a laminate, hologram, optical variable device or ultraviolet (UV) ink. The hidden security feature UV ink is not detectable to the naked eye and should not be confused with the laminate feature.

Most state-issued driver's licenses contain hidden features to confirm their validity. The Fraud Fighter UV counterfeit detector model UV-16 machine contains a UV light to detect hidden features that are only visible when placed under this light. The states that include a hidden feature using UV ink are:

Alabama State's Great Seal in UV ink on front and tricolor pastel state seal overlapping upper right corner of photo. Repeats state name and seal in holographic overlay with tricolor pastel state seal to right of name. (2005)
Alaska A hologram of the state name down the center and the name in smaller font over the entire front of the license.
Arizona "Grand Canyon State" and state silhouette in holographic overlay with state seal.
California State flags on front of license; usually can see three under UV light.
Colorado State seal appears.
Connecticut Row of state seals at bottom of license and outline of state with name diagonally through it. State name repeats across back under UV light.
Delaware Holographic overlay with repeating pattern of horse and rider; state seal in UV ink on back.
District of Columbia Has security overlay with "WASHINGTON DC" and "THE AMERICAN EXPERIENCE."
Florida State Seal and camera number overlapping photo plus vertical "FLORIDA."
Hawaii Holographic overlay of a Hibiscus flower and "ALOHA STATE."
Idaho A Holographic pattern of the state outline and the state name in gold.
Illinois "ILLINOIS" repeats across the face of the license.
Indiana Pattern of torch and stars (2004). Newer licenses: holder's name, birth date across bottom of larger photo visible under UV light.
Iowa A multicolored state seal and DOT logo repeating, plus state name in block numbers and stars.
Kansas Current license has ghost image; pattern on front of state seal and name changes color. (2005)
Kentucky "THE BLUE GRASS STATE." State seals in full color. "KENTUCKY TRANSPORTATION CABINET" repeated on license.
Louisiana State seals in full-color UV ink, optical variable device of state outline. Middle of license: ghost image, optical variable device of state outline overlaps ghost image and photo.
Maryland "Maryland" repeats across the face of the license (2004).
Massachusetts State seal repeating in UV ink. Prior license had pattern of MA repeating across face of license.
Michigan State seals in center of license.
Minnesota Current license has holographic state seal under UV light. Prior license has holographic state name and snowflakes, Ultraviolet loons, micro printing and a ghost image on front of license.
Mississippi Current: repetitive holographic pattern of state seal and "DPS" or prior: state seal and outline under UV light.
Missouri Current: "SHOW ME" or prior: "MISSOURI" running through it in UV ink.
Montana Security feature of a Grizzly bear, "MONTANA" diagonally across license.
Nebraska Variable pattern of state name and seal.
New Hampshire "New Hampshire" in gold printing repeated over entire license.
New Jersey Driver's name and DOB in bottom half of large photo. (2004)
New Mexico Current on back of license is a special state symbol and state name. Prior license had state outline on back in UV ink.
New York Repetitive pattern of New York state seal hidden in surface and large state seal. Also a large Coat of Arms can be seen in UV ink.
Oklahoma Current state seal and Department of Public Safety seal repeat under UV light. "Oklahoma" appears over and over on front of license. (2004)
Oregon "Oregon" appears repeatedly on front of license. (2004)
Pennsylvania Current has keystone outline enclosing "PA" repeating across top under UV light. "Pennsylvania" repeats on back in UV ink. State name repeats on back of license.
Rhode Island Current has state flag emblem visible under UV light. State of Rhode Island (in caps).
South Dakota State name repeats in stylized script across license face.
Texas Has security laminate repeating "TEXAS" in metallic ink visible under UV light.
Utah Current has "UT" repeating in UV ink. Middle of license has optical variable device of all Utah county names; ghost photo image, multiple state seals in UV ink.
Vermont "Vermont" appears diagonally across front of license. (2004)
Washington Optical variable device of state name across license; state seal across middle license visible under UV light.
West Virginia Line of green state outlines with yellow overlapping, "WV" repeats across middle, green and yellow state seal overlaps photo at bottom left.
Wisconsin Has a holographic pattern of state name and state seal plus "WISCONSIN DEPARTMENT OF TRANSPORTATION."
Wyoming Current has holder's name, birth date and ghost image visible under UV light. "Wyoming" repeating on front of license.

The states that currently do not have a hidden image on their licenses are:

  • Arkansas
  • Georgia
  • Maine
  • Nevada
  • North Carolina
  • North Dakota
  • Ohio
  • South Carolina
  • Tennessee
  • Virginia

The National Escrow Administration office is regularly notified at settlement@fnf.com of identifications missing the required specifications as described above and in the I.D. Checking Guides. The most common missing element is the hidden image, which is only visible by placing the I.D. under a black light. The Fraud Fighter UV-16 has been the tool used to detect these discrepancies.

Now that settlement agents have learned how to detect fraudulent identifications, what should they do once one is discovered? First, do not confront the individual(s) – you do not know the level of criminal you are dealing with.

If a fake I.D. is detected, go back to the customer and explain how all I.D.'s are verified by referring to the I.D. Checking Guide. Review the validation paragraph which describes the hidden image. Take the customer to the Fraud Fighter machine and show them his or her I.D. is missing the described image. Then explain the I.D. presented does not contain the elements required in order to notarize the signature and ask the customer to leave.

What did not occur in the above scenario? Accusations, right? Correct! Give the customer back his or her I.D. The safety and security of our settlement agents is far more important than that fake I.D. If the customer was willing to commit forgery, what else might that individual do? This is a very non-confrontational way to excuse someone from your office. Some offices have even put the Fraud Fighter machine in their conference room. Borrowers have come in and asked what that is. Once the machine's function was explained to them, those same borrowers have turned around and left without even sitting down.

Where can you get a Fraud Fighter machine? UVeritech™. Contact the supplier online at www.fraudfighter.com or by calling 800.883.8822. Also, we receive a special discount, so be sure to ask for the FNF rate. The 2008 I.D. Checking Guides can also be ordered through settlement@fnf.com.


International Espionage - Part II

In the sequel to last month's story, find out in this issue if the seller was able to siphon off her proceeds and ill-gotten gain from her unfrozen line of credit. Did Bank of America (BofA) release the funds into the customer's Swiss bank account? You will be surprised by the bittersweet ending.

When we last reported on this story, the seller had drawn down $254,000 against the available balance of her line of credit on the day prior to closing. We paid off the existing loan, only to find out our payoff check was short $254,000. We had also paid the seller $834,000 in proceeds. With more than a million dollars in her checking account, the seller was attempting to move all the money offshore to a Swiss bank account.

Cathy Anderson of the FNT Tampa District acted swiftly to obtain an injunction to freeze the checking accounts of the seller. In the meantime, banking administration and corporate claims worked directly with BofA to strike a deal with the seller. Ultimately, BofA received its $254,000. The seller agreed to transfer the money as payment in full, if and only if, BofA agreed to forgive the additional days of accrued interest and FNT agreed to release monies held in escrow in the amount of $1,200 for post-closing repairs. BofA and FNT agreed to the seller's terms in order to pay the line of credit; record the lien release and deliver free and clear title to the buyer.

According to Cathy, "Without the immediate assistance of Don Eppley, the vice president from corporate banking administration, and Katie Schmidt, corporate claims counsel, the Company would have surely suffered a $254,000 loss. They were right on the ball and took immediate action to resolve the issue."

Moral of the Story
While we are actively working with BofA to ensure this type of scenario does not occur on future transactions, our settlement agents can not assume the issuance of a payoff statement from the line-of-credit-lender also constitutes a freeze of the checking account against future draws by the borrower. The settlement agent should have the seller agree to freeze the account, either by acknowledging so on our form or the bank's form. And the freeze agreement should be faxed to the lender. Then, double checking the payoff amount prior to disbursement is paramount to loss prevention.


Black Tarzan, LLC.

An escrow officer was suspicious of the buyer because he had already bounced two previously deposited checks issued to the Company. The final deposit was an "official check" that looked suspicious.

Earlier this year, Linda Chrisman reported a buyer named "Black Tarzan, LLC" who attempted to give her a personal check for $430,000. The same buyer had bounced two prior checks to FNT. In response, Linda requested he convert the personal check to a cashier's check, or better yet, a wire transfer. The next morning the buyer appeared in Linda's office with an "official check" drawn on Washington Mutual Bank®. Linda accepted the check, although it looked suspicious to her.

After the buyer left Linda's office, Linda contacted the issuing branch of Washington Mutual Bank and spoke with the operations manager. At the manager's request, Linda faxed the front and back of the check for review. The manager called back and confirmed Linda's suspicions: The check was, in fact, counterfeit.

The Washington Mutual manager gave Linda some clues to look for when presented with an "official check" in the future:

  • Only one signature is required.
  • A photocopy of the check should have revealed the word "void" on the face of the check.
  • On the reverse side of the check, just below the payee endorsement line, the words "original document" should be reflected inside the circle.

The bank manager was grateful to Linda and the Company for reporting the counterfeit item and stated the bank fully intends to pursue legal action against the check's remitter. In the meantime, Linda contacted the broker and advised him of the counterfeit check. The broker contacted the buyer, whose only comment was he "was going to the bank to straighten things out." To date, Linda has heard nothing from the buyer and has cancelled her escrow. As a token of appreciation from the Company, Linda has been presented with a $1,000 reward and a letter of recognition.