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MADISON — Attorney General J.B. Van Hollen announced today that he and other Attorneys General and the District of Columbia have reached a $120 million multi-state settlement with Lender Processing Services, Inc. and its subsidiaries, LPS Default Solutions and DOCX. The proposed consent judgment resolves allegations that the Jacksonville-based company, which primarily provides technological support to banks and mortgage loan servicers, “robo-signed” documents and engaged in other improper conduct related to mortgage loan default servicing. When entered by the court, the judgment would require LPS and its subsidiaries to reform its business practices and, if necessary, to correct documents it executed to assist the homeowner. Wisconsin’s share of the settlement is approximately $1,505,315. The lawsuit and proposed consent judgment were filed today in Dane County Circuit Court.
“The actions of LPS and its subsidiary were significant violations of Wisconsin consumer law, which threaten the integrity of the foreclosure process,” Attorney General Van Hollen said. “Today’s settlement reflects Wisconsin’s continued efforts to combat these types of violations and restore borrowers’ faith in the legal system.”
Among other things, the consent judgment will require proper execution of documents and prohibit signature by unauthorized persons or those without first-hand knowledge of facts attested to in the documents, enhanced oversight of the default services provided, and a review of all third-party fees to ensure that the fees have been earned and are reasonable and accurate. The settlement also accomplishes the following:
In the proposed settlement, LPS stipulates to important facts uncovered in the investigation, including the practice by DOCX of so-called “surrogate signing,” the signing of documents by an unauthorized person in the name of another and notarizing those documents as if they had been signed by the proper person, as well as other improprieties in the document execution and recordation or filing process.
Once the judgment is entered by the courts, LPS will undertake a review of documents executed during the period of January 1, 2008, to December 31, 2010, to determine what documents, if any, need to be re-executed or corrected. If LPS is authorized to make the corrections, it will do so and will make periodic reports to the Attorney General of the status of its review and/or modification of documents. Consumers also may call the LPS toll-free number and request review and correction of any documents executed by LPS at any time. For questions regarding document execution, call 866.854.8935, and for questions regarding LPS field services, call 800.767.8674.
The following states joined Florida in today’s settlement: Alabama, Alaska, Arizona, Arkansas, California, Connecticut, Georgia, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Mississippi, Montana, Nebraska, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming, and the District of Columbia.
The State of Wisconsin was represented by Assistant Attorney General Lara Sutherlin. Copies of the Summons and Complaint, and Consent Judgment are available at the following links: