Lender Processing Unit Docx Indicted in Missouri for Forgery

Docx LLC, a unit of Lender Processing Services Inc., was charged in Missouri with forgery and making a false declaration related to mortgage documents it processed.

A grand jury in Columbia, Missouri, handed down the 136-count indictment against Docx and founder Lorraine Brown alleging that a person whose name appears on 68 notarized deeds of release didn’t actually sign the paperwork, Chris Koster, the state’s attorney general, said in a statement yesterday.

“When you sign your name to a legal document, it matters,” Koster said. “Mass-producing fraudulent signatures on millions of real estate documents across America constitutes forgery.”

Lender Processing, based in Jacksonville, Florida, says about half of all U.S. mortgages by dollar volume are serviced using its loan-servicing platform. The company will fight the charges, said Michelle Kersch, a Lender Processing spokeswoman.

“LPS has cooperated with the Attorney General’s office for over three months and has engaged in meaningful discussions to resolve past issues,” Kersch said in an e-mailed statement. “We are disappointed with the Attorney General’s moving forward with these allegations.”

Shares Drop

Lender Processing fell 2.6 percent to $19.21 at 9:45 a.m. in New York Stock Exchange composite trading. The shares had climbed 31 percent this year before today.

Brown couldn’t be located in telephone directories and the telephone at Alpharetta, Georgia-based Docx was disconnected.

If convicted of forgery, Brown may face as long as seven years in prison for each count, Koster said. Docx may be fined as much as $10,000 for each forgery conviction and $2,000 for each false declaration conviction, he said.

All 50 states announced almost 16 months ago they were investigating bank foreclosure practices, including faulty documents used to seize homes. A proposed settlement with five banks is being supported by more than 40 states.

The New York Times reported the indictment earlier. Docx’s practices previously were highlighted in a report on CBS Corp.’s "60 Minutes’’ television program, Koster said in the statement.

To contact the reporter on this story: Phil Milford in Wilmington, Delaware, at pmilford@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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