Mortgage industry employees are still signing documents they havent read and using fake signatures more than eight months after big banks and mortgage companies promised to stop the illegal practices that led to a nationwide halt of home foreclosures.
County officials in at least three states say they have received thousands of mortgage documents with questionable signatures since last fall, suggesting that the practices, known collectively as robo-signing, remain widespread in the industry.
The documents have come from several companies that process mortgage paperwork, and have been filed on behalf of several major banks. One name, Linda Green, was signed almost two dozen different ways.
Lenders say they are working with regulators to fix the problem but cannot explain why it has persisted.
Last fall, the nations largest banks and mortgage lenders, including JPMorgan Chase, Wells Fargo, Bank of America and an arm of Goldman Sachs, suspended foreclosures while they investigated how corners were cut to keep pace with the crush of foreclosure paperwork.
Critics say the new findings point to a systemic problem with the paperwork involved in home mortgages and titles. And they say it shows that banks and mortgage processors havent acted aggressively enough to put an end to widespread document fraud in the mortgage industry.
Robo-signing is not even close to over, says Curtis Hertel, recorder of deeds in Ingham County, Mich., which includes Lansing. Its still an epidemic.
Robo-signing refers to a variety of practices. It can mean a qualified executive in the mortgage industry signs a mortgage affidavit document without verifying the information. It can mean someone forges an executives signature, or a lower-level employee signs his or her own name with a fake title. It can mean failing to comply with notary procedures.
In all of these cases, robo-signing involves people signing documents and swearing to their accuracy without verifying any of the information.
The 14 biggest U.S. banks reached a settlement with federal regulators in April in which they promised to clean up their mistakes.