In a report aired April 3, 2011, CBS 60 Minutes reports on the foreclosure mess, and in particular about forged documents used in foreclosure procedures. The full 14 minute video report, presented by Scott Pelley, is posted on the CBS News website. A follow-up video interview with Mr. Pelley is posted on 60 Minutes Overtime.
The report illuminates the problem of missing mortgage assignments in the mortgage industry. The story in particular focused on actual forged mortgage assignments, created to fill in the missing links in the chan of title. For example, “Linda Green” was listed on thousands of mortgages as a “Vice President” of twenty different banks. Not only was the actual Linda Green no Vice President (more like a shipping clerk), but many other people signed mortgage documents as “Vice President Linda Green”, two of which appeared on camera. One demonstrated how he signed 350 documents an hour, 4,000 a day!
Foreclosures that involved documents signed by “Linda Green” included Wells Fargo, HSBC, Bank of America, Citi Bank, Deutsche Bank, and US Bank, all of which told 60 Minutes they farmed out their mortgage processing. The fraud reported in the 60 Minutes story was allegedly committed by an entity called Docx, was owned by LPS (Lender Processing Services) LPS told 60 Minutes that its which says it shut Docx down in 2009. The FBI and several states are investigating, according to the story.
60 Minutes interviewed Sheila Bair, the Chairman of the U.S. Federal Deposit Insurance Corporation (FDIC), who recommended the possibility of raising a “cleanup” fund of several billion dollars, from banks, to pay homeowners to accept the ownership claim of mortgage banks, which would be cheaper than attempting to prove mortgage ownership in many cases.
Follow-up: Here’s a link on Scribd (a social publishing site) by Lynn E. Szymoniak, the attorney cited in the 60 Minutes piece, which found “Linda Green” to be VP of dozens of entities (also found: multiple offices held by “Tywanna Thomas, Korell Harp and Shelly Scheffey”.) Ms. Szymoniak also published on Scribd an “open letter” about the issue of how Lender Processing Services, Inc. “solves bank’s missing paperwork problems in foreclosures.”