LAS VEGAS (AP) — A lawyer in Las Vegas has filed a civil lawsuit seeking class-action status on behalf of homeowners he says have been hurt by the filing of fraudulent foreclosure documents during an alleged "robo-siging" scheme.
Matthew Callister said he wants a state judge to stop tainted home sales and evictions and order Lender Processing Services Inc. and several bank and mortgage companies to modify loans and pay monetary damages to affected homeowners.
"This is to say, 'Stop. Let us try to modify the loan appropriately,'" Callister said. "Then we'll seek damages."
Jacksonville, Fla.-based Lender Processing Services said in a statement that it has acknowledged flaws in some documents filed in Las Vegas, but it denies the filings resulted in any wrongful foreclosures. The company promotes itself as the leading provider of mortgage processing, serving most U.S. banks and handling more than half of all foreclosures in the nation.
The Las Vegas Sun first reported that the lawsuit alleging deceptive trade practices had been filed Tuesday in Clark County District Court on behalf of five homeowners. A hearing was not immediately scheduled.
Callister told The Associated Press that he had at least 20 more plaintiffs to add to the case.
The civil lawsuit came days after Nevada Attorney General Catherine Cortez Masto filed a civil lawsuit in Las Vegas accusing Lender Processing Services of orchestrating a massive robo-signing scheme to file fraudulent documents before the local housing market collapsed in 2008.
Lender Processing Services disputes those allegations and promised to fight the lawsuit.
Authorities around the nation have alleged widespread fraud in foreclosure documents filed without banks and mortgage officials verifying the information they contained. The issue surfaced last year in places with large numbers of foreclosures, and banks backtracked to make sure paperwork was in order.
In Nevada, foreclosures dropped dramatically after a new state law went into effect Oct. 1 requiring lenders to prove that they have authority to foreclose.
The attorney general's lawsuit seeks what could amount to hundreds of millions of dollars from Lender Processing Services Inc. and several subsidiaries including DOCX LLC and LPS Default Solutions Inc.
The civil court filings come after state prosecutors last month obtained a grand jury indictment containing more than 600 counts that accuse LPS officials Geraldine Ann Sheppard and Gary Randall Trafford, both of California, of directing notaries public in Nevada to sign documents without properly witnessing signatures on tens of thousands of foreclosure documents.
Trafford and Sheppard have pleaded not guilty. Their trial is scheduled for Sept. 17.
Four notaries have pleaded guilty in recent weeks to attesting to the legality of signatures of people not in their presence. Three are due for sentencing next year, and one was found dead at home after missing her sentencing.
Police have said they found no indications of foul play in the death. More details from the coroner are pending toxicology results.
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