Given that a year has gone by since the new rules were issued by the Consumer Financial Protection Bureau, you would think that most of the players in the mortgage industry would have brought their practices up to code, right? Well according to the CFPB’s latest supervision report that isn’t the case. The bureau’s eighth edition…
When I became aware of a new class action lawsuit involving mortgage servicers it reminded me of an experience I had a few years ago. I’ve had homeowner’s insurance with Allstate for the past 11 years and have never been late to pay my premiums. So, imagine my surprise when I received a nasty letter…
One Californian and three Nevada residents have received felony indictments for their mortgage lending fraud scam. A 15 count indictment was returned by a grand jury on April 22, charging William Patterson, 51, of El Monte, Calif.; along with Las Vegas residents Lynda Finch-Estrada, 54, William Chrissikopoulos, 43, and Alan Dornhuber, 63. Operating under the…
State Attorneys General have forced five giant mortgage firms to shell out $25 billion to settle claims of “robo-signing” and other foreclosure abuses — but putting anyone in jail has proven to be a much more difficult proposition.
In one of only two robo-signing prosecutions nationwide, a judge last week threw out the entire case, including more than 100 felony counts each against Gary Trafford and Geraldine Sheppard of Orange County.
The Californians had worked as title officers for Lender Processing Services, a giant firm that helps banks and mortgage servicers generate legal documents.
A mortgage task force assembled by Nevada Atty. Gen. Catherine Cortez Masto had accused Trafford and Sheppard of directing the fraudulent notarization and filing of notices of default, the paperwork used to start foreclosures, on delinquent Las Vegas-area borrowers.
But Clark County District Court Judge Carolyn Ellsworth ruled last week that prosecutors committed misconduct in their presentations to the grand jury that indicted Trafford and Sheppard in November 2011. The missteps included providing “irrelevant and highly inflammatory evidence” about how the evictions affected the homeowners, the judge said.
The dismissal stands in contrast to the outcome of the second robo-signing prosecution. In that case, Lorraine Brown, founder of DocX, a former Lender Processing Services subsidiary, pleaded guilty to a federal conspiracy charge in Jacksonville and to Missouri state charges of forgery and falsifying documents.
Brown faces a federal sentence of up to five years in prison and a Missouri sentence of at least two years, a spokeswoman for the Missouri attorney general said.
The sentences, to be imposed next month, would run concurrently.
A Hayward woman will spend the next 18 months in prison after pleading guilty to mortgage fraud and tax evasion, prosecutors said Tuesday.
Cynthia Suratos Lorica, 51, entered the guilty pleas on Monday before Chief U.S. District Court Judge Claudia Wilken.
The judge sentenced Lorica to 18 months in prison and ordered her to pay more than $1 million in restitution, said U.S. Attorney Melinda Haag. Lorica must also participate in three years of period of supervised release.
She was ordered to start serving the sentence on March 27.
Under a plea agreement, Lorica admitted to participating in a scheme to obtain money from Washington Mutual Bank in 2006 and 2007 by making false statements in loan applications secured by real property.
During that time, she was the owner and CEO of All Ways Financial Services Inc., a financial services company. She was also an officer of Absolute Value Financial Inc., licensed by the state to originate mortgage loans and to engage in real estate transactions.
Lorica was involved in the preparation and submission of loan applications to various federally insured financial institutions and other lending institutions.
She also admitted to evading taxes on income she received in 2006 and 2007 and to substantially underreporting her gains from the sale of real estate as well as underreporting her income from All Ways Financial and claiming a mortgage interest deduction that she was not entitled to receive.
Lender Processing Services Inc. (LPS) agreed to pay $35 million to resolve criminal fraud violations involving fraudulently signed and notarized mortgage documents, the Justice Department announced last week.
LPS entered into a non-prosecution agreement with the department and the U.S. Attorney’s Office for the Middle District of Florida. Through the settlement, LPS announced it will pay $20 million to the United States Marshals Service and $15 million to Treasury.
The agreement also requires the company to meet a series of other conditions.
The department stated LPS has already taken a number of remedial actions to address the misconduct at DocX, a wholly owned subsidiary of LPS, and has wound down all the subsidiary’s operations and re-executed and re-filed mortgage assignments as necessary.
The settlement also follows guilty pleas from Lorraine Brown, the former CEO/president of DocX. In November, Brown pled guilty to conspiracy to commit mail and wire fraud in federal court in Florida and entered a plea deal in Missouri. Michigan attorney general Bill Schuette also brought charges against Brown and recently announced the former CEO pled guilty to racketeering.
The Justice Department statement explained that over a 6-year period ending in 2009, employees of DocX falsified signatures on mortgage-related documents. Brown and others at DocX were accused of directing authorized signers to allow unauthorized staff to sign and have documents notarized in order to increase profits.
The announcement follows a $127 million multistate settlement in January to resolve “robo-signing” allegations.