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Missouri AG indicts DocX and its former president in robo-signing probe

A Missouri grand jury issued a 136-page indictment against DocX, the mortgage processing affiliate of Lender Processing Services (LPS), and its founder and former president Lorraine Brown for allegedly forging and making false declarations on mortgage forms.

Missouri Attorney General Chris Koster's office said the indictment contends that the names on 68 notarized deeds of release made on behalf of various lenders are not the names of the persons who actually signed the documents.

DocX's role in the national robo-signing scandal made headlines when 60 Minutes rolled out a special report on DocX employee Linda Green alleging she signed thousands of mortgage documents on behalf of major banks with no knowledge of the accuracy of their contents.

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

The indictment quickly caught the attention of analyst Carter Malloy at Stephens.

"This is one of the first criminal charges we have seen against LPS and former employees of the company. However, it does not appear that the case includes any new allegations," analysts with Carter Malloy said in a report.

In November 2011, Nevada Attorney General Catherine Cortez Masto charged two former LPS employees with alleged robo-signing.

About a week ago, LPS pushed back against a deceptive trade practices suit that Masto filed against LPS that accuses LPS and its DocX and LPS Default Solutions units of document execution fraud, deceptive statements, failure to control foreclosure attorneys and misrepresentations on fees and services.

LPS claims the acts alleged by the AG are not actionable under local law and claims the accusations "are a collection of suppositions, legal conclusions and inflammatory labels that entirely fail to link the alleged conduct with any transaction in this state that could rise to a claim under Chapter 598."

In the Missouri case, if convicted, Brown could face up to seven years in prison for each count and DocX could be fined up to $10,000 for each forgery conviction and $2,000 for each false declaration conviction.

A spokesperson for LPS was not immediately available for comment.

kpanchuk@housingwire.com

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