Former LPS Employees Allege 30% to 78% Error Rate in Borrower Mortgage Records, Contradicting Banker/Regulator Cover-Up « naked capitalism

Former LPS Employees Allege 30% to 78% Error Rate in Borrower Mortgage Records, Contradicting Banker/Regulator Cover-Up « naked capitalism

The document goes through a detailed account of firm’s use of robosigners, surrogate signers (aka forgers) and its document fabrication service, DocX. While this may seem to be old hat, some of the details are nevertheless intriguing (management at least bothered to try to select forgers based on their ability to make signatures that resembled the original; anyone who questioned whether this activity was proper was fired within a week). More important, this lawsuit does serious damage to the claims of bank defenders (the latest being Karl Rove in the Wall Street Journal) that foreclosure abuses were merely about cutting corners and everyone who was foreclosed on deserved it. But as we’ll see shortly, the underlying records were often corrupted, thus calling into question whether the foreclosure actions really were correct. Remember, LPS’s reach is wide. 14 of the 15 biggest loan servicers are its clients and every one of the 50 biggest banks use some of its services.