Florida investigating ‘bogus’ foreclosure records: Attorney General looking at Fidelity National Financial and Lender Processing Services [The Florida Times-Union, Jacksonville]

May 15--Florida's attorney general is investigating whether Jacksonville-based Lender Processing Services and Fidelity National Financial were involved with forging real estate documents for foreclosure lawsuits.

The probe deals with a Lender Processing subsidiary that "seems to be creating and manufacturing 'bogus assignments' of mortgage," according to a synopsis the Attorney General's Office posted on its website.

Lender Processing spokeswoman Michelle Kersch said by email Saturday that the Attorney General's Office hadn't contacted the company. She said the company hasn't done anything wrong and would cooperate with any agency.

Assignments are notices that a mortgage has been sold or transferred from a lender to someone else. Many lenders routinely sell or assign their mortgages to investors, who could be businesses, pension funds or individuals.

If a homeowner stops making mortgage payments, the investor can sue to take the home -- a foreclosure.

But the investor has to have paperwork proving the original lender sold the mortgage. And many don't.

Investigators suspect workers at a Lender Processing company called Docx LLC could have created paperwork that was "illegally executed, false and misleading," said a statement posted on the Attorney General's Office site.

"These documents are used in court cases as 'real' documents of assignment and presented to the court as so, when it actually appears that they are fabricated," the statement said.

The state investigation is looking for civil infractions, not crimes.

Lawyers fighting foreclosures have questioned the authenticity of some assignment paperwork prepared by Docx.

Court files have given them some extra ammunition.

At least 10 times since 2008, Docx assignments have been filed in Florida courthouses naming the new owner of the mortgage only as "BOGUS ASSIGNEE FOR INTERVENING ASMTS [assignments]," court records show.

On at least three assignments, the initial owner of the mortgage is listed as "A BAD BENE" -- seemingly, for a false beneficiary.

Those forms were filed in Duval, Nassau, Volusia, Lee, Orange, Pasco and St. Lucie counties.

Kersch said Bogus Assignee and Bad Bene were placeholder names in a computerized form the company uses, and should have been replaced with specific information about that mortgage.

She said Docx has no idea whether documents are being used in foreclosure suits. She said the company simply enters information into a standard form and "has no independent discretion concerning the timing of the preparation of the document nor the information contained."

Kersch said Docx began preparing mortgage assignments in 2008 and stopped last year.

It's not clear how Fidelity National Financial, a Fortune 500 title insurance company, might fit into the state review.

Fidelity National Financial bought Alpharetta, Ga.-based Docx in 2005. But the next year, the company spun off many of its holdings into an independent company, Fidelity National Information Services, and no longer owns Docx. Fidelity National Information Services spun off Lender Processing as a separate company in 2008.

Fidelity National Financial Chief Compliance Officer Paul Perez declined to comment publicly.

Like a deed, assignment forms carry notarized signatures of people listed as officers of the company transferring the mortgage to the new owner.

But a number of forms prepared through Docx carry signatures of the same people listed as officers of different companies. One signer was listed as a vice president at three different mortgage companies, based in different parts of the country, over a six-month period.

Kersch said those forms are being signed by Docx employees with the approval of the companies assigning the mortgages.

The attorney general's investigation started in early April, shortly after news reports announced said federal prosecutors were reviewing records from an LPS subsidiary. LPS had reported that to shareholders in its annual report in February.

At the time, the company said it had "identified a business process that caused an error in the notarization of certain documents" used in foreclosures.

Jacksonville Area Legal Aid attorney April Charney said she began reporting concerns about Docx documents to the Attorney General's Office in 2006 or 2007.

"I know they have been playing around with this for years," she said.

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