Reuters Report Is ‘Inaccurate And Sensational,’ Says LPS

Posted by Orb Staff on December 13, 2010 No Comments
Categories : Mortgage Servicing

In a pair of statements posted on its website, bundled-service provider Lender Processing Services (LPS) has refuted numerous allegations made in articles published by Reuters and the Florida Times Union.

In a letter to Reuters' editors, LPS' senior vice president of corporate communications, Michelle Kersch, called the Dec. 6 Reuters report titled ‘Legal Woes Mount for Foreclosure Kingpin’ ‘inaccurate and sensational.’ The Reuters piece, which served as the basis for a Florida Times Union report released on the same date, stated that LPS lingered in the document-execution space, even after shutting down DocX, a former subsidiary that has been tied to incidents of robo-signing and is under investigation by Florida's attorney general.

The Federal Reserve and the Office of the Comptroller of the Currency are among the federal entities investigating LPS.

According to Reuters, LPS began transferring its signing units to clients' offices in December 2009. LPS says it discontinued signing new mortgage assignments at DocX in November 2009 and began the transition away from document signing at the Default Solutions division in 2008.

‘Based on its own internal investigation and evaluation of customer requirements, LPS made the business decision to halt the line of business in which LPS employees were authorized to, and did, sign mortgage foreclosure documents filed with the courts,’ Kersch says in the LPS statement published Dec. 10. ‘Our customers let us know that they needed time to implement this transition, and they asked us to help in that process. As a result, LPS provided temporary notary support while clients resumed full responsibility for document execution.’

LPS is the target of several class-action lawsuits, including one that accuses the company of illegally splitting fees with attorney firms. Another class action, which popped up last week, has been been brought on behalf of LPS shareholders.

The San Francisco office of Lieff Cabraser Heimann & Bernstein LLP has brought a class-action lawsuit on behalf of all persons who purchased or acquired the common stock of LPS between July 2009 and Oct. 4, 2010. The action, pending in the U.S. District Court for the Middle District of Florida, lobs several allegations, including that LPS failed to disclose that it had engaged in deceptive business practices.

SOURCES: LPS, Lieff Cabraser

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