The Florida attorney general and Marshall C. Watson and his law firm agreed on a $2 million settlement in connection with the AG's investigation into foreclosure improprieties at the firm, the AG said. The Fort Lauderdale, Fla.-based firm is one of the largest foreclosure firms in Florida. Friday's settlement is the first to be announced involving the four original firms scrutinized in an investigation that began under former AG Bill McCollum. Since then, the investigation has been widened to include several other foreclosure law firms in the state. The settlement with the Law Offices of Marshall C. Watson, and Watson as an individual, calls for a $2 million payment along with changes in the way the firm handles foreclosure cases. Besides the settlement payment, the firm agreed that each foreclosure case it handles must contain the following: the original note, or a lost note affidavit; the original mortgage or a copy of the recorded mortgage; and documentation establishing the loan and mortgage are in default. If those documents don't reflect "the plaintiff to be named in the foreclosure complaint as the party entitled to foreclose the note and mortgage, there must also be contained in the law firm's file documentation reflecting that the plaintiff is a holder of the note or a nonholder in possession of the note who has rights of a holder," the settlement states. For active cases, the settlement requires the firm to go back and ensure that such documents are part of the foreclosure file. That may require the firm to amend or replace affidavits, according to the settlement. "Our firm is pleased the attorney general's investigation has been resolved without any findings," said Marshall C. Watson, CEO of the Law Offices of Marshal C. Watson. "Throughout the investigation, we worked closely with the attorney general's office to develop best practices and procedures to implement at our firm. With our firm's even tighter controls now place we are setting a high bar for the mortgage law provider industry, and our clients recognize and value the positive steps we are taking." Allegations against the firm ranged from robo-signing, notarization problems and improper process serving to forged documents and questionable fees, among others. “We are aggressively investigating these law firms in order to protect the interests of everyone involved in foreclosure proceedings," Florida AG Pam Bondi said. "Homeowners, lending institutions and the courts deserve to know that the law is being followed and all documentation is true and accurate. She said the Marshall Watson firm fully cooperated with the investigation since its inception. Half of the payment will go to the Florida Bar Foundation to continue the Florida Attorney General Mortgage Foreclosure Grant Program. The grant program funds Legal Aid attorney positions throughout Florida who are devoted to the representation of low-income individuals facing foreclosure actions. The other half goes to attorney general's office to cover legal fees associated with the investigation. Once the payment is received, the investigation is closed, according to the settlement. A spokeswoman for the law firm confirmed on Monday that the payment had been made. The investigations into the practices of several other Florida law firms are ongoing. Write to Kerry Curry. Follow her on Twitter @communicatorKLC.