WASHINGTON, D.C. (Legal Newsline) - A $120 million multi-state settlement was announced Thursday with Lender Processing Services Inc. and its subsidiaries, LPS Default Solutions and DocX, resolving allegations of improper mortgage servicing.
The Jacksonville-based LPS allegedly robo-signed documents and engaged in other improper mortgage loan default servicing conduct. The $120 million settlement was reached with 44 state attorneys general and the District of Columbia.
"Among the most egregious practices during the recent foreclosure crisis was the robo-signing of foreclosure documents," New Hampshire Attorney General Michael Delaney said. "This settlement requires those firms who were responsible for much of that activity to pay for their illegal practices and to correct the documents that they improperly executed. We hope that this settlement will let others know that New Hampshire takes the threats to the integrity of such documents seriously, and will cause anyone intending to engage in similar practices in the future to think twice before doing so."
Under the terms of the proposed settlement, LPS and its subsidiaries would be required to institute business practice reforms and correct documents it executed, if necessary. The consent judgment would also prohibit signature by unauthorized employees or people without first-hand knowledge of facts stated in the documents, require enhanced oversight of provided default services, and require a review of all third-party fees to make sure that fees are reasonably and accurately earned.
If the settlement is accepted, LPS will review the documents it executed between January 1, 2008, and December 31, 2010, to determine if any documents must be re-executed or corrected. If authorized, LPS will make the corrections and periodically report to Delaney's office about document review and/or modification status.
LPS is currently setting up a toll-free telephone line that consumers can use at any time to request correction and review of documents that LPS executed.