Former DocX Mortgage Processor Pleads Guilty to Racketeering

FEB 12, 2013 4:45pm ET

Lorraine Brown, the former president of mortgage document processor DocX, pleaded guilty in Kent County Circuit Court to one count of racketeering for her role in authorizing the fraudulent signing of mortgage documents filed in Michigan.

The guilty plea follows an April 2011 investigation by Michigan Attorney General Bill Schuette into questionable mortgage documentation filed within the state’s Register of Deeds offices during the foreclosure crisis.

County officials suspected the assignment of about 1,000 mortgage documents filed in their offices may have been forged under the name “Linda Green,” which was being used by Brown to orchestrate her fraudulent scam. Schuette said these improperly executed documents were created and recorded at Brown’s direction between 2006 and 2009. 

As part of his investigation, Schuette reviewed the documents filed in Michigan and prepared by document processing company DocX. He found that Brown established and orchestrated a widespread scheme of robo-signing—a practice in which employees were directed to fraudulently sign another authorized person’s name on mortgage documents in order to execute these documents as quickly as possible.

“Shortcuts like robo-signing are just one part of the mortgage foreclosure crisis,” Schuette said. “The message here is clear—if you break the law, there are consequences. We will continue to prosecute criminals who target and exploit Michigan homeowners.”

In addition to the criminal charge brought against Brown, Schuette reached a $2.5 million civil settlement with Lender Processing Services, the parent company of the now defunct DocX, on Jan. 31 to settle claims of unlawful foreclosure practices.

Brown is facing 20-years in prison when she is sentenced in May.       

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