Nevada sues major foreclosure processing firm LPS
Nevada has filed suit against a major player in the foreclosure business, Lender Processing Services Inc., alleging that the company is responsible for perpetrating widespread consumer fraud in the Silver State.
The lawsuit against LPS of Jacksonville, Fla., and several of its subsidiaries alleges that the company falsified, forged or fraudulently filed countless documents in foreclosure cases across Nevada, requiring individual employees to execute or notarize as many as 4,000 foreclosure documents a day.
LPS is used by many major banks to process foreclosures, and the suit said the company is responsible for more than 50% of foreclosures annually.
“The robo-signing crisis in Nevada has been fueled by two main problems: chaos and speed,” Nevada Atty. Gen. Catherine Cortez Masto said in a statement. “We will protect the integrity of the foreclosure process. This lawsuit is the next, logical step in holding the key players in the foreclosure fraud crisis accountable.”
The suit alleges that LPS fraudulently notarized documents and forged signatures and hid the scope of the problems by misrepresenting that the problems were clerical errors.
The foreclosure firm is the subject of a number of investigations. California Atty. Gen. Kamala D. Harris, among others, is looking into the company’s practices.
LPS said that it had been cooperating with Masto’s office for more than 14 months and that it would defend itself vigorously against the suit. The company also accused Masto’s office of violating Nevada law by using a Washington, D.C., firm, Cohen Milstein Sellers & Toll, to investigate the company.
LPS has said that it has discovered problems with its past document practices, but added in its statement Friday that “the company is not aware of any person who was wrongfully foreclosed upon as a result of a potential error in the processes used by our employees.”
