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Lender Processing to Pay $2 Million Over Robo-Signing

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Aug. 2 (Bloomberg) -- Lender Processing Services Inc. agreed to pay Missouri $2 million to resolve a case against its DocX LLC over so-called robo-signing of mortgage-related documents.

A Columbia, Missouri, grand jury in February handed down a 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 those papers, Missouri Attorney General Chris Koster said then.

“Under the agreement, LPS will pay the state of Missouri $2 million and will cooperate with the Attorney General’s Office in its continuing criminal investigation” of Brown, Koster said in an e-mailed statement today.

Lender Processing Services is a provider of loan services technology, including a platform it says is used by the industry to handle about 50 percent of all U.S. mortgages by dollar value.

Robo-signing is a term used for the practice of signing mortgage-related documents without regard for their accuracy.

The Jacksonville, Florida-based company acknowledged the Missouri accord in a separately issued statement.

‘Important Milestone’

“This settlement is an important milestone in our ongoing efforts to resolve legal and regulatory issues related to the operations of DocX, which we closed in 2010,” Lender Processing Services Chief Executive Officer Hugh Harris said in the statement.

Koster and the company said $1.5 million of the settlement money will go to the Missouri treasury, while the balance will reimburse the attorney general’s office for the costs of the probe.

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

Brown’s attorney, Michael Holder of Columbia, Missouri, didn’t immediately reply to a phone message seeking comment on the settlement.

The cases are State v. DocX LLC, 12BA-CROO433, and State v. Brown, 12BA-CR00430, Boone County, Missouri, Circuit Court (Columbia).

To contact the reporter on this story: Andrew Harris in Chicago at aharris16@bloomberg.net

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

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