Tag Archives: robo-signing

Robo Cop

Robo-signing is back in the news, thanks in large part to the efforts of New York Attorney General Eric Schneiderman. Last August, Schneiderman was removed from a committee of state attorneys general investigating mortgage abuses. Schneiderman had the courage and integrity to state that he opposed any deal that gave participating banks a release from other litigation surrounding their mortgage activities, and that investigations should not be stopped until those responsible were held accountable.

Last month, Minnesota Attorney General Lori Swanson released a letter in which she supported Schneiderman and opposed the idea of giving a broad release to banks on foreclosure fraud in exchange for a quick settlement. She joins Delaware Attorney General Beau Biden, Massachusetts Attorney General Martha Coakly, and Nevada Attorney General Catherine Cortez Masto in voicing their concerns.

Robo-signing involves people signing documents and swearing to their accuracy without verifying any of the information. It’s a federal crime to sign someone else’s name to a legal document. It’s also illegal to sign your name to an affidavit if you have not verified the information you’re swearing to. Both are punishable by prison.

Last fall, the nation’s largest banks and mortgage lenders suspended foreclosures while they investigated the alleged robo-signing that was done to keep pace with the crush of foreclosure paperwork. The banks supposedly reviewed thousands of foreclosure filings, and where they found problems, they submitted new paperwork to courts handling the cases, with signatures they said were valid. The 14 biggest U.S. banks reached a settlement with federal regulators last April in which they promised to clean up their mistakes and pay restitution to homeowners who had been wrongly foreclosed upon. Then they resumed foreclosures.

However, there is new evidence that the practice continued and that banks and mortgage processors haven’t put an end to widespread document fraud in the industry. This can negatively impact sales in an industry that is still struggling to rebound after the recession. If robo-signed documents turn up in the property’s history, buying a home and trying to obtain title insurance becomes even more problematic because forged signatures call into question who actually owns the mortgage and the property.

Despite White House pressure in support of a settlement, Eric Schneiderman’s office has said it is conducting a banking probe that could lead to criminal charges against financial executives. I applaud him for his efforts.

So far, no individuals, lenders or paperwork processors have been charged with a crime over the robo-signed signatures found on documents.