Fraud in structured finance rarely starts with a sophisticated scheme. It survives on the distance between the investor and the dollar: a collateral schedule duplicated across facilities, a receivable for an obligor who doesn’t exist, a collection that never reached the controlled account.
This video walks through the two fraud mitigation controls built into the Granite Pass Securitization Management System (SMS):
Systematic Asset Allocation: Every asset is allocated to exactly one financing by system identifier, enforced by the engine and checked daily. When an asset moves from a warehouse facility into a term deal, SMS records the transfer in each facility’s roll forward, so an asset is never in two financings and never in neither.
Cash Verification: A dollar is verified only when three points agree: an independent source proves it exists, an asset assignment proves which asset it belongs to, and a receivable reduction proves it did its work. Evidence comes from bank, trustee, processor and lockbox data rather than the servicer tape, and anything that fails becomes an owned, aged exception.
Together, they show what the documents can’t: every step down in principal backed by a verified dollar from a genuine third party, at the level of a single asset and across the whole book.