LAS VEGAS (KSNV MyNews3) -- The massive robo-signing scandal that throws into question tens of thousands of Las Vegas foreclosures is unfolding. Newly-released transcripts from last month's Grand Jury hearing shed light on how the foreclosure fraud went down.
The transcripts include last month's testimonies from investigators, homeowners, temp workers and four notaries.
The workers, who were employed at Lender Processing Services (LPS) under Gary Trafford and Geraldine Sheppard, admitted to forging signatures on tens of thousands of notices of default.
Most blamed fear of unemployment for their decision to forge signatures and break the law. One notary said she needed to keep her job while getting through graduate school, another said he had a family to support.
Trafford and Sheppard are accused of running the scam by advising their employees to forge signatures on notices of default between 2005 and 2008. Those documents got the ball rolling on many Las Vegas foreclosures.
Notary Tracy Lawrence struck a plea deal with the state's Attorney General's Office for one count of notary fraud. She admitted to notarizing about 25,000 false documents. Lawrence was found dead in her home the day of her sentencing hearing a few weeks ago. Lawrence said during the Grand Jury hearing that LPS handled notices of default for trustees representing many major lenders, including Washington Mutual, Bank of America, Fannie Mae and Freddie Mac.
A criminal investigator for the Nevada Attorney General’s office said that out of tens of thousands of documents from LPS that his investigation of the fraud examined, an overwhelming majority seemed suspicious.
“It’s hard to find [a document] that you wouldn’t be suspicious of,” the investigator said, adding that legitimate documents from the company seemed to be the exception instead of the rule.
It wasn’t just the signatures that were fraudulent. According to the investigator, some of the forged documents contained information that had not been verified by those signing them. This sometimes led to the wrongful foreclosure of houses because of the innacuracies.
“We’ve had individuals who said ‘I was never late in my payments, but yet my house has been foreclosed on,’” he said.
Former Las Vegas homeowner Romy Ashjian, one of the witnesses who testified at the hearing, said that she was locked out of her own home without ever having been told that a notice of default had been recorded. Ashjian said she was behind on payments, but was working with a lender, Bank of America, to try to set up a short sale. When she returned home one day, however, she found that her home had been sold without her knowledge through a trustee sale.
Ashjian said many of her belongings were still inside the home, including furniture, medical records, collectibles, and her and her daughter's personal information including social security numbers. Many of these items were stolen before Ashjian was able to gain access to her property two weeks later.
Sheppard and Trafford are negotiating their voluntary surrender to the Nevada Attorney General.
