Missouri Grand Jury Hands Up Major Indictment Following Robo-Signing Scandal

​The nation's foreclosure crisis has officially entered its newest chapter -- criminal allegations against the various players involved -- and Missouri is playing a leading role.

Last Friday a Boone County grand jury handed up a 136-count indictment accusing an Georgia foreclosure-services company of widespread forgery and false declaration. That company, DocX, a unit of Florida-based Lender Processing Services, created and notarized reams of documents to help banks expedite home foreclosures. They did so by resorting to pervasive robo-signing tactics -- that's when a bank employee, often under another person's name, signs thousands of documents without verifying the information -- that resulted in the improper evictions cash-strapped homeowners, according to the 104-page indictment.

The grand jury also indicted the company's founder and former president, Lorraine Brown, under the same charges. DocX shuttered its operation in 2010 after the robo-signing scandal first came to light. Last year, the issue gained national attention when 60 Minutes reported that Linda Green, an employee of DocX, purportedly signed thousands of mortgage-related documents on behalf of several different banks and in multiple handwritings.

In the lead story in this morning's New York Times "Business Day" section, reporter Gretchen Morgenson details the indictment. She calls the lawsuit "one of the few criminal accusations to follow reports of widespread improprieties against homeowners."

Missouri Attorney General Chris Koster will prosecute the case.

Brown could face up to seven years in prison for each count, while DocX could be fined up to $10,000 for each forgery conviction and $2,000 for each false declaration conviction.

"The grand jury indictment alleges that mass-produced fraudulent signatures on notarized real estate documents constitutes forgery," Koster said in a statement. "Today's indictment reflects our firm conviction that when you sign your name to a legal document, it matters."

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Ban KKiller
Ban KKiller

Attorneys, most of them, are loath to strike new ground. Now that this courageous AG has started the ball rolling we can look forward to more AGs suing. It helps if the AG aspires to be the governor someday, right? There is plenty of wrong that can be corrected by suing the criminals involved. FRAUD and FORGERY  are serious, sort of. Class C felony in most case. The company has been shut down and MOST attorneys for the banksters are not willing to commit a crime (fraud/forgery) to illegally foreclose on homeowners. THAT is why foreclosures are slowing down. Homeowners know they can fight the banks and win. Do I have to say that not making your mortgage payment is bad but not a high crime? While fraud/forgery is a Felony? Suing for wrongful foreclosure? You bet. A summary judgement can be overturned and are done so every single day. Fraud/Forgery is a sure violation of due process as well as subject matter jurisdiction. Get an attorney and sue under title 42-1983! YOU WILL WIN. Have the courage to fight for your rights. 

Brad Hicks
Brad Hicks

I'm guessing that this means that Koster is pulling out of the 50-state settlement negotiations? Because the last word on that subject was that they had been bargained down to ONLY cover robo-signing complaints. If, now, even that's indictable in Missouri? Then either this is a push to get the banks to agree to the 50-state settlement, a really harsh bluff, or there is nothing left of the 50-state settlement.

I can see it either way. Given what little the settlement was going to let them off the hook for, the banks may have thought that the price was awfully high. This is a pretty effective way of letting them know what the price could be if they DON'T settle.

Now let's hope that the new financial fraud taskforce up in DC deals as aggressively with the rest of the crimes of the housing bubble, both the ones committed on the way up and on the way down. We'll be left with nothing in the way of bank management or stocks, the FDIC will have to recapitalize whole new banks. And it'll still be cheaper than having to fix the economy with the zombie banks holding it back. It's what we should have done, instead of TARP, in the first place.


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I bet evicted homeowners will feel like justice has been done once they see all that money flowing to the government in fine money. That'll show them!

Civil suits anyone?


Should be interesting to see how that all works out lol.Total-Privacy dot US

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