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LPS SEC 8-K Report | FDIC Slams Lender Processing Services, Inc. with $154,519,000 Lawsuit
Now that's gotta sting!
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
May 10, 2011
Lender Processing Services, Inc.
(Exact name of Registrant as Specified in its Charter)
001-34005
(Commission File Number)
ITEM 7.01. REGULATION FD DISCLOSURE
The
Federal Deposit Insurance Corporation (“FDIC”), in its capacity as
Receiver for Washington Mutual Bank (“WAMU”), filed a complaint on
May 9, 2011 in the U.S. District Court for the Central District of
California to recover alleged losses of approximately $154,519,000. The
FDIC contends these losses were a direct and proximate result of the
defendants’ alleged breach of contract with WAMU and alleged gross
negligence of the defendants with respect to the provision of certain
services by LPS’s subsidiary LSI Appraisal LLC, an appraisal management
company. In particular, the FDIC claims that the services provided
failed to conform with federal and state law, regulatory guidelines and
other industry standards, including specifically the provisions of the
Uniform Standards of Professional Appraisal Practice (“USPAP”). LPS
previously described the possibility of this suit in its Form 10-Q filed
May 5, 2011.
In its complaint, the FDIC cites, as
the cause of the damages claimed, 220 appraisals performed between
June 2006 and May 2008. However, for more than 75 percent of the
appraisals identified by the FDIC, LSI was contracted only to provide
reviews of appraisals, not to conduct the initial, full appraisals. For
these properties, the full appraisals were provided by other entities,
unrelated to LSI. For all appraisals subject to this complaint, LPS
believes there is no basis for a claim that LSI engaged in “gross
negligence” or breach of contract related to these appraisal services.
Appraisals
are estimates of value provided by a licensed real estate appraiser. A
review is an industry accepted methodology used to evaluate the data
gathered by the appraiser to support the conclusions of the original
appraisal report. A review, by definition, and as originally agreed to
by LSI and Washington Mutual, is not a product to be used for assigning a
value to a property, making a loan, determining the quality or
creditworthiness of a borrower, or determining the viability of a
borrower’s ability to repay a loan. It is also not an insurance policy
against non-repayment of a loan or a substitute for appropriate lending
practices.
LSI’s appraisal management process and its
network of appraisers meet industry standards and undergo
well-documented and rigorous evaluations that conform to the Uniform
Standards of Professional Appraisal Practice (USPAP). LPS believes that
any loan losses are not because of appraisal issues, but are due to the
quality of underwriting by WAMU, borrowers defaulting and the weakness
of the economy after the loans were made, among other factors.
LPS
contends that the services LSI provided satisfied the terms and
conditions of its contract with WAMU and were not performed with gross
negligence. Due to the early stage of this matter, however, it is not
possible to predict the outcome or the amount of possible loss, if any,
that may result from this matter. LPS stands firmly behind the integrity
of the services it provides to the mortgage industry and intends to
vigorously defend itself against these allegations.
SOURCE: SEC
www.4closureFraud.org
»
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So, while is might sound a little callous, save your sentimentality for your prayers. If you want to do some good, you don't need to look much farther than your own family or neighborhood to help someone who needs it. All the overt pronouncements of sentiment are pretty shallow water compared to the people who anonymously wade deep into the cold water to help another person with action instead of empty words 70-642 | SY0-201 | 000-106 | 640-816 | 642-832 | 1Y0-A19 | N10-004 | 000-105 |
It is a musical chairs version of who gets to take the biggest bite of this shit sandwich- the lenders, the appraisers or the title companies.
Kudos to the ZH community for the funniest thread in a while!
Let me try:
Will this lawsuit ultimately result in the unwining of the CDO (Certain Death Obligation) that is holding my MBS (Marriage Backed Security)? I really want to find who my wife is....legally....
Looks like LPS used appraisers like the Goldman Sachs et al. used the rating agencies. Let's dig deep into LPS; sunlight is always the best disinfectant.
The "outcome-based appraisal" was the seed for the entire housing Ponzi.
In order to bring a suit like this, they'd better have communications and a whistleblower that a jury will love... all of which state "let's use X guy and we can tell him the number to put in, etc."... my guess is that prosecutors in financial cases do not lift a finger until an entire case is presented lock stock and barrel and so easy a caveman could understand it... so, I'd expect these communications and people are out there ready to play ball...
If not, you're going to go into battle trying to prove subjective appraisals were somehow fraudulent? Good luck with that shit.
Yup. Unless an air-tight whistleblower is in place able to prove *systemic* abuse the appraisal fraud defense will boot-strap their argument with millions of "comparables". Color me skeptical, but at the end of the day this could be another "see...there is no there...there".
Either that or SEC will scape-goat some tiny real-estate office and pin back their ears in another political theater episode.
When is David Stern going to jail? He's not?!?
Some people can afford to be criminals.
Don't try this at home.
Oh noes!!! They'll only have to file Chapter 11. Big deal. Only people that get hurt are the poor assholes working for them, not the poison pill itself.
I liked this story when it was called Savings and Loans in the 80's.
Anyone else feeling history repeating.
SEC = Servicable Equine Cunts.
Sarah Jess-Equine Parker works at the SEC now??
Oh why'd you have to go do that?!?! Think of the children!
I can remember when $154M was a lot of money. They'll probably settled well short of that even.
Lucky nobody committed any crimes. Then someone would have to go to jail, right?
What?
Oh. That's right. Financial criminals never get sent to jail any more.
I bet you thought Perjury was a crime right? bwahahaha. Fraud? not any more. Mail fraud? don't go there. Wire fraud? LMAO.
Forgery (Robo-style)?
BWAH-HAHAHA-HAH-HA-hah-ha-hah-haha-ah...ha...
Maybe if someone could figure a way to trick some of the big players into videotaping a cop -- that'll land 'em in jail.