Metro Jacksonville

Nev. AG, Fla. firm trade barbs on 'robo-signing'


By KEN RITTER
The Associated Press


Updated: 8:11 p.m. Friday, Dec. 16, 2011

Posted: 10:51 a.m. Friday, Dec. 16, 2011


Nevada's attorney general traded barbs Friday with the nation's largest lender services company after filing a lawsuit in Las Vegas accusing it of orchestrating a "robo-signing" scheme to file fraudulent documents in the months before the local housing market collapsed.

The state civil lawsuit seeks what could amount to hundreds of millions of dollars from the company variously known as Lender Processing Services Inc., DOCX LLC, LPS Default Solutions Inc. and several subsidiaries.

Lender Processing Services, based in Jacksonville, Fla., said it "strongly disputes the allegations," and promised to fight.

"LPS has cooperated with the attorney general's office for more than 14 months to resolve its inquiry," the company said, accusing Attorney General Catherine Cortez Masto of improperly using a Washington, D-C.-based law firm in the investigation.

"The complaint highlights misconceptions about LPS and seeks to sensationalize a variety of false allegations in a misleading manner," it said.

The developments ratcheted up a fight over "robo-signing" â€" the practice of bank officials signing mortgage documents without verifying the information they contained. The issue surfaced last year in areas with large numbers of foreclosures, and banks had to backtrack and review foreclosures across the country to make sure their paperwork was in order.

Masto called the claims of improper investigation techniques "demonstrably false," and accused the company of trying to distract attention from the lawsuit.

"The robo-signing crisis in Nevada has been fueled by two main problems: chaos and speed," Masto said in a statement announcing the civil case had been filed Thursday in Clark County District Court.

"Former employees and industry players describe LPS as an assembly-line sweatshop, churning out documents and foreclosures as fast as new requests came in and punishing network attorneys who failed to keep up the pace," the statement said.

The civil court filing came after state prosecutors last month obtained a more than 600-count grand jury indictment accusing LPS officials Geraldine Ann Sheppard and Gary Randall Trafford of directing a "robo-signing" scheme that led to the filing of tens of thousands of fraudulent foreclosure documents in the Las Vegas area.

Trafford, 49, of Irvine, Calif., pleaded not guilty Friday. His lawyer, John Heuston, said he looks forward to his day in court. Sheppard, of Santa Ana, Calif., pleaded not guilty Wednesday.

Clark County District Court Judge Carolyn Ellsworth set bail for each at $50,000, and scheduled trial Sept. 17.

Four notary public officials have pleaded guilty in recent weeks to related criminal charges that they attested to the legality of signatures of people not in their presence. Each testified before the grand jury against Sheppard and Trafford.

Three are due for sentencing next year. One was found dead at home after missing her sentencing. Police said they found no indications of foul play. A cause of death from the coroner is pending toxicology results.

Lender Processing Services said it previously disclosed that it found "potential issues related to some of its past document execution practices," and asserting again that it was unaware of any property wrongfully foreclosed upon "as a result of a potential error in the processes used by our employees."

The publicly-traded company promotes itself as the leading provider of mortgage processing, serving most U.S. banks and handling more than half of all foreclosures in the nation.

Masto said company misconduct has been confirmed by testimony of former employees, interviews with officials in the industry and a review of more than 1 million pages of documents.

The 39-page court filing seeks $5,000 per violation for tens of thousands of violations stemming from a "pattern and practice" of "falsifying, forging and/or fraudulently executing foreclosure related documents, resulting in countless foreclosures that were predicated upon deficient documentation."

Among other claims, the lawsuit alleges the company required its notary publics to process up to 4,000 foreclosure documents a day; forced attorneys to "churn through foreclosures at a rate that sacrificed accuracy for speed;" and demanded a kickback or referral fee from foreclosure firms.

The lawsuit says that the portion of company revenue that includes foreclosure services quadrupled from nearly $278 million in 2006 to more than $1 billion a year in 2009 and 2010.

http://www.palmbeachpost.com/money/foreclosures/nev-ag-fla-firm-trade-barbs-on-robo-2036064.html

Nevada homeowners file class-action lawsuit over foreclosure robosignings


By Steve Green (contact)

Wednesday
21 December 2011
9:29 a.m.

Lender Processing Services Inc., the company targeted by Nevada’s attorney general in a foreclosure robosigning investigation, has been hit with a class-action lawsuit filed by Las Vegas and Henderson homeowners.

Jacksonville, Fla.-based LPS, one of the nation’s largest foreclosure processors, has insisted its robosigning problems in Nevada involved mere paperwork issues, have been addressed and did not involve wrongful foreclosures.

But Tuesday’s homeowner lawsuit said LPS’s use of “forged, fraudulent and/or erroneous” foreclosure documents tainted the foreclosure process to the point where LPS and banks it worked with “did not have authority to foreclose or to continue with the foreclosure process.”

The suit filed in Clark County District Court in Las Vegas alleges violations of Nevada’s Deceptive Trade Practices Act, seeks to block pending foreclosures involving allegedly forged LPS documents and seeks unspecified damages for completed foreclosures.

Besides the Nevada attorney general’s lawsuit filed against LPS last week alleging widespread fraud in its foreclosure paperwork operations, criminal charges have been filed in Las Vegas against two LPS officers and four notaries in what state prosecutors call a scheme in which thousands of foreclosure documents were tainted by forged signatures and bogus notarizations.

Also named as defendants in Tuesday’s class-action lawsuit were lenders and foreclosure trustees that work with LPS. They are Bank of America, its subsidiary ReconTrust Co.; IndyMac Mortgage Services, a division of OneWest Bank; and Regional Service Corp., which acts as a foreclosure trustee.

Tuesdays lawsuit was filed by five homeowners and is proposed as a class action representing “countless” more plaintiffs, likely thousands. Four of the named homeowners face foreclosure and the fifth has been foreclosed on, the suit says.

The proposed class of plaintiffs is defined as borrowers in Nevada who received foreclosure documents, called notices of default, “that were improperly executed by LPS, its predecessors or its subsidiaries.”

Tuesday’s lawsuit seeks a court declaration that LPS and its codefendants violated Nevada’s law governing foreclosure proceedings “in that they proceeded with the foreclosure process despite relying upon forged and falsified notices of default.”

“Plaintiffs and consumers have paid the ultimate price through bankruptcies, evictions and foreclosures that were predicated upon false, forged, fraudulent and/or inaccurate documents,” the lawsuit charges.

The suit also seeks a declaration that the notices of default issued by LPS “are null and void” and asks for an injunction blocking LPS and the codefendants from proceeding with the allegedly tainted foreclosures.

“Plaintiffs’ properties face foreclosure as a result of defendants violations of NRS 107.080 (the foreclosure law),” the suit says.

The suit also seeks unspecified actual and punitive damages and attorney’s fees. It was filed by attorneys at the Las Vegas law firm Callister & Associates LLC.

A request for comment was placed with LPS.

http://www.vegasinc.com/news/2011/dec/21/nevada-homeowners-file-class-action-lawsuit-over-f/

Shame on Pam Bondi! She claims signing other people's names is not considered forgery!!!!!

Is signing foreclosure documents for others forgery?

by Moe Bedard on January 16, 2012 in Scams




(Source: By Kimberly Miller The Palm Beach Post, Fla.) â€" The Nevada attorney general calls signing another person’s name on documents used to repossess a home “forgery” and a “scheme.”

Michigan’s attorney general launched a criminal investigation that includes whether “falsified signatures” were used in foreclosure cases.

But Theresa Edwards and June Clarkson were forced to resign their jobs as foreclosure fraud investigators for the Florida Attorney General’s Office, in part, for referring to so-called “surrogate signing” as forgery.

According to a Florida Inspector General report that cleared Attorney General Pam Bondi’s office of wrongdoing in the firings, the duo repeatedly used the word “forgery” in a 2010 presentation that included documents from the Jacksonville-based Lender Processing Services. The company complained and drew the attention of economic crimes boss Richard Lawson.

Lawson says in the inspector general’s Jan. 6 report that surrogate signing as it relates to Lender Processing Services, also called LPS, is not forgery, which requires an intent to defraud. The practice was authorized by the company, more evidence, Lawson said, that no forgery occurred.

Homeowner advocates who support Edwards and Clarkson are now questioning portions of the 83-page report. They point to the LPS signature issue as an example of what they say is Florida’s resistance to go after foreclosure fraud.

Big paperwork processor

“Theresa Edwards and June Clarkson were fired for aggressively investigating these practices,” said Palm Beach County home­owner Lynn Szymoniak, who is in foreclosure. ” Are these practices really OK in the opinion of the chief financial officer and the attorney general?”

LPS processes paperwork for more than 50 percent of the nation’s foreclosures, according to a December lawsuit filed by the Nevada attorney general. The company has said it stopped surrogate signing after its own investigation uncovered it at a now-closed subsidiary company called DocX.

Still, tens of thousands of documents are affected nationwide and the forgery debate contributes to the foreclosure logjam that has stalled Florida’s economic recovery.

While at least one Florida law professor agrees with Lawson, others maintain the issue transcends surrogate signing. Most of the signed foreclosure documents are also notarized, said Royal Palm Beach-based foreclosure defense attorney Tom Ice, meaning someone is swearing that the person signing is who they say they are.

“So, at the very least, surrogate signers are a species of notary fraud, which the courts take very seriously,” Ice said. “Why require notarizations at all if we don’t care who actually signs them?”

Edwards and Clarkson, who led Florida’s foreclosure fraud investigations, were routinely praised in performance reviews by their direct supervisor, Robert Julian, and lauded for netting a $2 million foreclosure-related settlement from the Law Offices of Marshall C. Watson.

But the inspector general report details complaints about the duo’s work made by Lawson, some of their colleagues, and LPS.

Those complaints include disorganized paperwork, the lack of independent investigation, relying too heavily on two Palm Beach County homeowner advocates for evidence (including Szymoniak), being unprofessional, and using incorrect legal theory.

Their work was so slipshod, Lawson said, that the investigations didn’t truly begin until after Edwards and Clarkson left and the files were reassigned.

A major issue raised was a December 2010 PowerPoint presentation Edwards and Clarkson gave at a conference of the Florida Association of Court Clerks and Comptrollers.

The presentation includes several references to LPS and “forgeries.”




LPS attorney Joan Meyer wrote a letter to Edwards and Clarkson on Jan. 6, 2011, criticizing the PowerPoint, which she said mischaracterized “delegated signing authority” as forgery.

Lawson supports that stance, adding that Meyer gave the information to Edwards and Clarkson prior to the presentation.

Edwards maintains surrogate signing is forgery. If there was no intent to injure or defraud, why wouldn’t the person just sign their own name, she said.

“Clearly, it was done to mislead the reader of the document,” Edwards said. “It is unbelievable the manner in which these entities believe they can flaunt the requirements for the proper execution of legal documents.”

In Nevada’s lawsuit, the attorney general said LPS’ forged documents, often signed by temporary workers with no training and, in at least one case, limited English skills, caused “grievous harm” to homeowners.

Professor backs state

One confidential witness told the Nevada attorney general that she may have notarized documents that she had actually signed because “she was signing her own name as a notary, but forging someone else’s name as a surrogate signer.”

LPS says on its website that the Nevada suit was filed to sensationalize “false allegations in a misleading manner.”

“Because the surrogate signers were signing the documents as part of their jobs, and presumably believed that they had the authority to sign, they could not have committed fraud,” said Nova Southeastern Law professor Robert Jarvis. “Moreover, in most loan documents, the borrower expressly agrees that the bank, or the bank’s representatives, can take all steps necessary to protect its interest. This would include signing documents.”

Bondi foes complain LPS has an undue influence on her office, pointing to LPS’ hiring last year of former Deputy Attorney General Joe Jacquot and campaign donations from LPS to Bondi and the Republican Party.

In a July 14 email, Meyer asked Florida Chief Assistant Attorney General of Economic Crimes Victoria Butler, to “please encourage” Michigan to consider a civil pursuit rather than criminal investigation.

“The only discussion we had with Michigan was in regards to their attendance at an informational meeting with LPS,” said Bondi spokeswoman Jennifer Meale. “They chose not to attend the meeting.”

Lawson said in the report it’s “laughable” to insinuate his office was “cutting LPS some favors” because he assigned Julian, an experienced attorney and the former supervisor of Edwards and Clarkson, to the LPS case.

“And this is one of the biggest issues in my division,” Lawson said in the report and referring to LPS, “and it’s one of the biggest issues in the State of Florida.”

___

©2012 The Palm Beach Post (West Palm Beach, Fla.)


http://www.loansafe.org/is-signing-foreclosure-documents-for-others-forgery