Courtesy of investigative news site ProPublica, a new chapter in the robo-signing saga unfolds—a report that GMAC, one of the nation’s largest mortgage management companies, filed a bogus document last year to demonstrate its legal standing to foreclose on a house.
The home was originally financed by Ameriquest, one of the largest subprime lenders during the housing boom. According to ProPublica, GMAC needed to prove it had been granted rights to the mortgage from Ameriquest in order to kickstart foreclosure proceedings. The problem was, Ameriquest went out of business in 2007. To work around this obstacle, GMAC produced a document stating the delinquent Ameriquest loan had been assigned to it “effective of” August 2005, ProPublica reports.
That document was filed with New York City’s finance department in July 2010—nearly two years after Ameriquest ceased to exist.
“It’s fraud,” Linda Tirelli, a consumer bankruptcy attorney, told ProPublica. “I want to know who’s going to do a perp walk for recording this.” According to the site, it’s a felony in the state of New York to file a public record with “intent to deceive.”
Regardless, GMAC isn’t backing down. The company says it plans to foreclose anyway.
“We will determine and complete the necessary steps to remediate and proceed with foreclosure,” GMAC spokesperson Gina Proia told ProPublica.
That plan may run into problems. Jeffrey Stephan, who signed the document while serving as head of GMAC’s “Document Execution” team, is the same guy who testified last year that he signed 400 foreclosure-related documents a day. The revelation helped start the robo-signer scandal. Last week the Vermont Supreme Court threw out a foreclosure case brought by US Bank, ordering the bank to start the entire process over because it relied on documents signed by Stephan.
“It is neither irrational nor wasteful to expect the foreclosing party be actually in possession of its claimed interest,” the judges found, “and have the proper supporting documentation in hand when filing suit.”
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Image: Casey Serin, via Flickr.com