As a parent of three children, I very much want to believe what my children tell me, whether it is about their day, something they became aware of, a current event, or a situation in their life. I do believe my kids are generally honest; however, sometimes the filter or context through which they see and understand things may be biased by their view of the world, what they think they know, simply what they want to believe, or what they want me to believe. So as a good parent, trust but verify is often a useful cliché to live by.
A recently identified fraud involving loans that were sold as USDA guaranteed loans reminded me of that principle: trust but verify. It appears this alleged fraud involved an individual who owned a firm that was an approved USDA originator and who was familiar with the USDA policies and procedures. He was able to take advantage of a crack in the system to draft fraudulent guarantee documentation and sell it as authentic.