Robosigning firms get Calif., Ill. subpoenas

@CNNMoney May 25, 2011: 7:06 PM ET

WASHINGTON (CNNMoney) -- The California and Illinois attorneys general have issued subpoenas to big mortgage servicing firms accused of rubber-stamping foreclosure documents, expanding their investigations into the firms.

Illinois Attorney General Lisa Madigan sent subpoenas to two Florida servicers -- Lender Processing Services Inc. and Nationwide Title Clearing Inc. -- as part of her probe into so-called robosigning practices, according to Madigan's office.

California Attorney General Kamala Harris issued subpoenas to Lender Processing Services on Wednesday, her office said.

Harris is creating a new "mortgage fraud strike force," a state panel staffed with attorneys and investigators who will dig into "every step of the mortgage process," from origination to the sale of mortgage-backed securities, her office said.

"California homeowners have been exposed to fraud and crime at every step of the mortgage process," Harris said in a statement. "Justice demands we come to their aid, and a key step in that is to investigate robosigning and the potential for inaccurate or unjust foreclosures."

Wall Street banks face New York mortgage probe

The two mortgage servicing companies under investigation are not among those in top-secret talks with federal agencies and state attorneys general over a proposed settlement of allegations that thousands of homeowners wrongly faced foreclosure.

However, Lender Processing Services and Nationwide Title Clearing work for the banks in talks with the attorneys general, including Bank of America (BAC, Fortune 500), Wells Fargo (WFC, Fortune 500), JPMorgan Chase (JPM, Fortune 500), Citigroup (C, Fortune 500) and Ally Financial (GJM).

Those big banks are in talks with regulators that could result in a multi-billion-dollar pool of money that could be used to help struggling homeowners.

Lender Processing Services processes loans for more than 50% of all U.S. mortgages, according to the Illinois attorney general's office. Nationwide Title Clearing is smaller but works for eight of the top 10 lenders, Madigan's office said.

Calls to Lender were not immediately returned.

A Nationwide spokeswoman said the company had not received the subpoena and could not comment on the specifics.

"Nationwide Title Clearing welcomes the opportunity to help clear up common misconceptions surrounding the issue and wishes to help the public gain a deeper understanding of normal mortgage industry documents and processes," said Cassandra McSparin. To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.80%3.88%
15 yr fixed3.20%3.23%
5/1 ARM3.84%3.88%
30 yr refi3.82%3.93%
15 yr refi3.20%3.23%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Economic Calendar
Latest ReportNext Update
Home pricesAug 28
Consumer confidenceAug 28
GDPAug 29
Manufacturing (ISM)Sept 4
JobsSept 7
Inflation (CPI)Sept 14
Retail sales Sept 14
  • -->

    Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer. Morningstar: © 2018 Morningstar, Inc. All Rights Reserved. Factset: FactSet Research Systems Inc. 2018. All rights reserved. Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor's Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2018 and/or its affiliates.