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For Immediate Release

Media Contacts:

David Paulson, 410-576-6357

Alan Brody, 410-576-6956

AG Gansler Reaches $120M Settlement with Lender Processing Services Company, subsidiaries engaged in improper robo-signing, surrogate signing

Baltimore, MD ( Jan. 31, 2013) - Attorney General Douglas F. Gansler announced today that his Consumer Protection Division, along with 45 other Attorneys General, reached a $120 million settlement with Lender Processing Services, Inc. (LPS), and its subsidiaries, LPS Default Solutions, Inc. and DocX, LLC, which provide default or foreclosure-related services to banks and mortgage loan servicers.

"Maryland homeowners should not be forced from their homes because of shoddy foreclosure practices that include the use of robo-signed documents," said Attorney General Gansler. "These types of reckless short-cuts have turned the dream of homeownership into a nightmare for too many of our friends and neighbors."

LPS allegedly robo-signed documents and engaged in other improper conduct related to its mortgage loan default servicing and foreclosure processing. According to the Complaint filed today in the Circuit Court for Baltimore City, DocX utilized a practice known as "surrogate signing," in which documents were signed by one person in the name of another and notarized as if they had been signed by the proper person. DocX also engaged in other improprieties in the document execution and recordation or filing process.

The settlement requires proper execution of foreclosure-related documents, prohibits any signature by unauthorized persons or those who do not have first-hand knowledge of facts attested to in the documents, mandates enhanced oversight of the default services provided and requires a review of all fees by other players in the foreclosure process to ensure that the fees have been earned and are reasonable and accurate. The settlement also:

  • Ensures that LPS has proper authority to sign documents on behalf of a servicer, if in fact it signs documents;
  • Requires LPS to accurately identify the authority that the signer has to execute the document and where that signer works;
  • Prohibits LPS from notarizing documents outside the presence of a notary and ensures that notarizations will comply with applicable laws;
  • Prohibits LPS from improperly interfering with the attorney-client relationship between attorneys and the financial institutions that service mortgages;
  • Prohibits LPS from providing incentives to promote attorney speed or volume to the detriment of accuracy;
  • Requires LPS to ensure that foreclosure and bankruptcy counsel or trustees can communicate directly with the servicer;
  • Requires LPS to have enhanced oversight and review of processes over third parties it manages, including those entities that perform property preservation services;
  • Prohibits LPS from imposing unreasonable mark-ups or other fees on third-party providers' default or foreclosure-related services;
  • Requires LPS to establish and maintain a toll-free phone number for consumers concerning document execution and property preservation services (including winterization, inspection, preservation and maintenance); and
  • Requires LPS to modify mortgage documents that require remediation when LPS has legal authority to do so and when reasonably necessary to assist a consumer or when required by state or local laws.

LPS has also agreed to undertake a review of documents executed between January 1, 2008 and December 31, 2010 to determine what documents, if any, need to be re-executed or corrected. If LPS is authorized by its financial clients to make the corrections, it will do so and will make periodic reports to the Attorney General concerning the status of its review and/or modification of documents. Consumers may also call an LPS toll-free number and request review and correction of any documents executed at any time by LPS.

Consumers are encouraged to contact the Consumer Protection Division at 410-528-8662 or 888-743-0023 before entering into any business arrangement to find out if complaints have been filed against a company.


Attorney General of Maryland 1 (888) 743-0023 toll-free / TDD: (410) 576-6372
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