Loan servicers face increasing risks, according to speakers at the Fraud Issues Conference. Loan modifications are risky business. The government is pushing for more modifications, but if servicers don’t take care to protect the interests of secondary market investors, they could be subject to litigation. The chatter in the hallways after this session suggests that many believe it is only a matter of time before a servicer ends up in court. Short sales that are the result of property flipping, identity theft and modifying loans originally made based on fraudulent or misrepresented information are all danger zones for servicers. More to follow…