FDIC Files Suit Against Fidelity, LPS INC. and Others – Who’s Next?

On May 9, the Federal Deposit Insurance Corporation (FDIC) filed suit against Fidelity and others seeking over $154 million in damages. The suit, filed in the US District Court, alleges that Fidelity and LPS acted with a “carelessness that rises to the level of gross negligence…” in its dealings with the now-defunct Washington Mutual Bank.

Named in the suit are LSI Appraisal LLC, Fidelity National Information Services Inc., Lender Processing Services Inc., Lender Processing Services LLC and LPS Property Tax Solutions Inc. f/k/a Fidelity National Tax Service, Inc., LSI Title Company, and LSI Title Agency, Inc.. The FDIC, acting as the receiver of Washington Mutual, alleges that LSI used employees who “lacked skill,” resulting in appraisals that “substantially inflated appraised values.” The FDIC further alleges that Fidelity “effectively controlled and directed LSI’s wrongful acts and omissions.”

Read the entire lawsuit and complete allegations here.

Our industry, the economy and the American people have all been hurt by shortcuts and excesses. Today’s FDIC suit alleges wrongdoing by gross negligence. Follow closely the developments in this case and learn the facts through RE-Insider.com.

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