Guilty Pleas in Foreclosure Fraud Cases

The founder and former president of DocX, once one of the nation’s largest foreclosure-processing companies, pleaded guilty on Tuesday to fraud in one of the few criminal cases to have arisen out of the housing crisis.

The executive, Lorraine O. Brown, 56, entered a guilty plea in federal court in Florida and a plea agreement in state court in Missouri related to DocX’s preparation of improper documents used to evict troubled borrowers from their homes. Ms. Brown’s guilty pleas will lead to a prison term of at least two years, the Missouri attorney general said.

Foreclosure abuses, like the routine filing of apparent forgeries with the nation’s courts, gained widespread notoriety in 2010. Ms. Brown admitted to directing DocX employees, beginning in 2005, to sign other peoples’ names on crucial mortgage documents. Many of the documents, like assignments of mortgages and affidavits claiming that a borrower’s i.o.u. had been lost, were used by banks and their representatives to foreclose on homeowners. DocX also filed falsely notarized documents with county clerks across the country. These practices are now known as robo-signing. In her plea, Ms. Brown admitted to participating in the falsification of more than a million documents.

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4closureFraud.org