Black Knight fka Lender Processing Systems — Short memories can hurt you

Frankly, I am frequently bewildered by the astonishment of people who should know better. Everything that I report on my blog is derived from actual concrete reliable data and information and previous legal proceedings in which there were administrative findings of fact and legal consequences. Some followers of my blog are well-intentioned but are married to the view that the system is so corrupt, nobody can do anything about it. But I have been doing “something about it” (i.e., winning cases) for 15 years — along with several dozen other lawyers and even many pro se homeowners. Even people in other countries have had success.

This blog and my radio show and webinars are devoted to one thing: getting homeowners to wake up as early as possible to the fact that they have been duped into a transaction about which they know nothing but which they think they know everything.

I don’t deny that the results are corrupt. But I do think that the consequences of entering the legal system without knowledge of legal procedure will produce a fatal result in most cases. Being right is not enough

Black Knight is a financial technology (FINTECH) company that played a pivotal role in the creation and promotion of false fabricated documents. In turn, this resulted in the fake national narrative that the loan account receivables still existed when in fact those accounts were extinguished during the process of securitization. And that is because securitization was not and never was intended to securitize any obligation owed by any homeowner who was falsely labeled as a borrower.

Without that false narrative, judges would have refused to allow foreclosure judgments to be entered or foreclosure sales to be conducted. But just like any other court action, the judge is restricted to consider only what is presented — not what should’ve been presented or what could’ve been presented. Before the era of false claims of securitization of debt, judges regularly refused to allow foreclosure even when they were uncontested — if the paperwork was not properly presented in the correct form. The only thing that has changed is that the investment banking community has entered the lending marketplace with the paperwork that is properly presented in the correct form, but which is false.

Black Knight, Inc. went public in 2017, underwritten by Goldman Sachs. This is a closely related company to Black Knight Financial Services LLC. Black Knight has branded itself as an authority for data on real estate and in particular mortgage lending. But it continues, through its direct operations and its relations with closely related companies to provide “gap” documents that are completely fabricated, false, backdated, and forged by automated processes.

In other words, it is directly or indirectly involved in the creation of false data that it then reports. Black Knight has an indemnification agreement in which it protects Servicelink (another closely related Black Knight company) from any claims. That is because the “services” performed by Servicelink and other companies is the man behind the curtain — i.e., the actual company that provides automated processing of receipts from homeowners, records of those receipts, and deposit of those funds into accounts controlled by the investment banking company who has no ownership interest in any payments, obligation legal debt, note or mortgage from any homeowner.

In plain language, this means that homeowner payments are revenue to the investment banks and not a reduction in any loan account receivable. And THAT is because there is no loan account receivable —- a fact that is nearly universally rejected by anyone who does not have years or decades of experience in investment banking and accounting.

But just because it is rejected by people who are ignorant of the facts, does not mean it is wrong or in any way misleading.

Had tip to summer chic.

There were several other press releases across the country just like this one. The one thing missing from all of these suits, settlements and orders is the connection of the dots. If we know that the industry was using fraudulent, forged, false, backdated, robosigned documents then two questions emerge:

  • Why were the related foreclosures not reversed?
  • More fundamentally, why were fake documents needed? In an industry in which lenders literally wrote the laws, the template documents, and the procedures by which loans were originated and enforced, why was it so easy to originate the loans in extreme volume and not so easy to enforce them without falsifying documents?

FOR IMMEDIATE RELEASE Contact: Jennifer López
DATE: December 16, 2011 702-486-3782

NEVADA ATTORNEY GENERAL SUES LENDER PROCESSING
SERVICES FOR CONSUMER FRAUD

Carson City, NV – Attorney General Catherine Cortez Masto announced today a lawsuit against Lender Processing Services, Inc., DOCX, LLC, LPS Default Solutions,
Inc. and other subsidiaries of LPS (collectively known “LPS”) for engaging in deceptive practices against Nevada consumers.

The lawsuit, filed on December 15, 2011, in the 8th Judicial District of Nevada, follows an extensive investigation into LPS’ default servicing of residential mortgages in
Nevada, specifically loans in foreclosure. The lawsuit includes allegations of widespread document execution fraud, deceptive statements made by LPS about efforts to correct document fraud, improper control over foreclosure attorneys and the foreclosure process, misrepresentations about LPS’ fees and services, and evidence of an overall press for speed and volume that prevented the necessary and proper focus on accuracy and integrity in the foreclosure process.

The robo-signing crisis in Nevada has been fueled by two main problems: chaos and speed,” said Attorney General Masto. “We will protect the integrity of the foreclosure process. This lawsuit is the next, logical step in holding the key players in the foreclosure fraud crisis accountable.”

The lawsuit alleges that LPS:

1) Engaged in a pattern and practice of falsifying, forging and/or fraudulently executing foreclosure-related documents, resulting in countless foreclosures that were predicated upon deficient documentation;

2) Required employees to execute and/or notarize up to 4,000 foreclosure-related documents every day;

3) Fraudulently notarized documents without ensuring that the notary did so in the presence of the person signing the document;

4) Implemented a widespread scheme to forge signatures on key documents, to ensure that volume and speed quotas were met;

5) Concealed the scope and severity of the document execution fraud by misrepresenting that the problems were limited to clerical errors;

6) Improperly directed and/or controlled the work of foreclosure attorneys by imposing inappropriate and arbitrary deadlines that forced attorneys to churn through foreclosures at a rate that sacrificed accuracy for speed;

7) Improperly obstructed communication between foreclosure attorneys and their clients; and

8 ) Demanded a kickback/referral fee from foreclosure firms for each case referred to the firm by LPS and allowed this fee to be misrepresented as “attorney’s fees” on invoices passed on to Nevada consumers and/or submitted to Nevada courts.

LPS’ misconduct was confirmed through testimony of former employees, interviews of servicers and other industry players, and extensive review of more than 1 million pages of relevant documents. Former employees and industry players describe LPS as an assembly-line sweatshop, churning out documents and foreclosures as fast as new requests came in and punishing network attorneys who failed to keep up the pace.

LPS is the nation’s largest provider of default mortgage services, processing more than fifty percent of all foreclosures annually.

The Office of the Nevada Attorney General recently indicted Gary Trafford and Gerri Sheppard as part of a separate, criminal investigation into the conduct of robo-signing scheme which resulted in the filing of tens of thousands of fraudulent documents with the Clark County Recorder’s Office between 2005 and 2008.

Nevada homeowners who are in foreclosure or are facing foreclosure are advised to seek assistance as soon as possible. Homeowners can find information for a counseling agency approved by the U.S. Department of Housing and Urban Development (HUD) by calling 800-569-4287 or by visiting http://1.usa.gov/NVCounselingAgencies.

Additional information on foreclosure resources can be found at www.foreclosurehelp.nv.gov.

Anyone who has information regarding this case should contact the Attorney General’s Office hotline at 702-486-3132 (when promoted select “0”) to obtain information on how to submit a written complaint. Nevada consumers can file a complaint with the Nevada Attorney General’s Office about LPS by sending a letter with copies of any supporting documentation to the Nevada Office of the Attorney General, Bureau of Consumer Protection: 555 E. Washington Ave Suite 3900, Las Vegas, Nevada 89101

EDITOR’S NOTE: Contrary to what has been written or implied by people who are either misinformed or who are being directly paid by intermediaries for the investment banks on Wall Street, the simple answer to the direct question that I have posed above is that the reason for the fake documentation is that there was no real documentation that could be used. There was no real documentation because there were no real transactions supporting the documents that were used in foreclosure.
Every long-term illegal scheme has three main attributes:
  1. A false national narrative created by advertising and government complicity.
  2. False labels that comply with the false national narrative, combined with government acceptance of those labels.
  3. Addiction to the revenue produced by the scheme. This applies to all players, high and low.

When you look at the Madoff Ponzi scheme (40 years), the Purdue pharma scheme (30 years) on OxyContin, or the securitization Ponzi scheme (30 years), the elements are the same. And the results are interesting from an academic point of view: despite the catastrophic results of those schemes, there remain many people (Including those in government) who still subscribe to the narrative and use the labels. It’s very challenging to let go of a belief even when there is ample evidence and even knowledge of the falsity of the presumptions.

 

3 Responses

  1. @Anon didn’t know about that case and res judicata ruling. May go along w bankster narrative that they paid for their sins. Kamala Harris actually did separate arrangement to allow legal action after the settlement I recall. Even so she and Katie Porter didn’t enforce. So Dem or Rep let banksters off the hook. The specific requirements of NMS such as valid transaction etc shouldn’t be a matter of res judicata. All these issues coming up now w CA again holding $330 mil in legal aid!

  2. Correct again Hammertime. What Neil writes is true. And, people can win, But why has the government even allowed this? You are correct – there is an addiction to fines and fees – that only the government benefits from at federal level. These settlements should be a red flag to courts, but they are not. Fines and fees do not stop the fraud, and they do not help the people. Local level is incapable of ascertaining what the federal level knows. And, as with the CFPB case against Ocwen/PHH, the district court determined res judicata by 2014 settlement. Oral argument at appeal is not until next year. Clearly, the courts see no urgency in addressing the continued fraud. Thanks.

  3. The complicity of govt and courts can be seen in their addiction to fines and fees while turning a blind eye to the reasons those fines and fees were imposed. And still both Obama and Trump administrations collected only a fraction of fees and fines as at the local level such as the city of Los Angeles failing to collect millions in its own foreclosure registry ordinance.

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