DOCX, a mortgage-services company, and DOCX parent company Lender Processing Services, Inc. (LPS), settles criminal proceedings with the State of Missouri.
In February 2012, Attorney General Chris Koster obtained criminal indictments against DOCX related to its alleged role in the mortgage-document surrogate-signing scandal of 2010.
Under the agreement, LPS will pay the state of Missouri $2 million and will cooperate with the Attorney Generalâ€™s Office in its continuing criminal investigation of founder and former president of DOCX, Lorraine Brown.
Specifically, LPS will pay $1.5 million into the Missouri state treasury and will pay $500,000 to the Merchandising Practices Revolving Fund of the Attorney Generalâ€™s Office as reimbursement for the costs of the investigation.
DOCX earned approximately $363,000 in total revenue from the execution and filing of mortgage-related documents in the state of Missouri for the years 2008-2010. Consequently, LPSâ€™s payment of $2 million to the state is well in excess of the revenue earned by the company in the state of Missouri during the relevant time period, and is approximately two and a half times the amount that could be obtained as a result of convictions on the previously pending indictments. LPS discontinued the operations of DOCX in May 2010. LPS terminated Lorraine Brown in November 2009.
Attorney General Chris Koster obtained the indictments against Brown and DOCX for forgery and making false declarations related to mortgage documents processed by DOCX in the state of Missouri. The Attorney Generalâ€™s indictments alleged that DOCX directed employees of the company to falsely sign mortgage documents in the names of various bank vice presidents without proper authorization. Furthermore, the indictments alleged that such forged signatures were then falsely notarized by DOCX as though such bank vice presidents had actually signed the documents. Finally, the forged documents were then filed in courthouses across Missouri.
â€œMy office has taken the position that when you sign your name to a legal document, it matters,â€ Koster said. â€œThe monetary disgorgement and the agreement we have reached in this criminal case with DOCX should remind all mortgage-services processers that our system of titling real property will be held to a standard of accuracy and truth expected by homeowners across the country.â€
â€œI appreciate LPS taking responsibility for the actions of its subsidiary, and for their agreeing to cooperate in our continuing criminal investigation of this matter.â€
Koster noted that LPS has also entered into a separate consent order with the Federal Reserve, the FDIC, and the Office of the Comptroller of the Currency that requires LPS to allow an independent, third-party consultant to conduct a review of document execution services provided by subsidiaries of LPS, such as DOCX, between January 1, 2008, and December 31, 2010. The review is intended to assess potential financial injury to borrowers. Under the federal consent order, LPS has agreed to prepare a remediation plan to provide restitution to borrowers if any such financial harm is found. Under the terms of todayâ€™s agreement, LPS has agreed to report to the Attorney Generalâ€™s Office on a quarterly basis to provide the status of its compliance with the federal consent order as it pertains to Missouri residents.
The Attorney Generalâ€™s Office has agreed not to prosecute LPS or DOCX for DOCXâ€™s previous surrogate-signing related conduct so long as LPS makes the above-referenced payments and complies with the terms of the agreement.
The indictments against DOCX and Lorraine Brownwere the result of months of investigation by the Missouri Attorney Generalâ€™s Office into the robo-signing scandal that injected thousands of questionable mortgage documents into the market. The 68 documents on which the indictments were based were purportedly signed by an employee of DOCX, Linda Green, in her role as a designated vice president for several of the nationâ€™s leading banks, but were in fact signed by someone else, and subsequently notarized and filed in Missouri.
The pending charges against the defendant are merely accusations. As in all criminal cases, the defendant is presumed innocent unless or until proven guilty.