Guilford County official takes on the banking industry

Hooray for Guilford County Register of Deeds Jeff Thigpen. Yesterday, this rather obscure public official had the guts to file a lawsuit against a goodly part of the American banking industry.  Here’s a link to the press release (also reproduced below) and other relevant documents.

Guilford County Sues To Clean Up Banks’ “Mess” at the Register of Deeds

Guilford County, ex rel. Jeff L. Thigpen, Guilford County Register of Deeds, filed suit today against LPS/DocX, MERSCORP, MERS, Inc., and numerous banks, loan servicers, and foreclosure specialists seeking to clean up the “mess” Defendants created in the County’s property records registry.   

“Our office uncovered an abundance of falsified, forged, and fraudulently executed mortgage documents,” said Thigpen.  “But our investigation only found the tip of the iceberg.  We need the banks to clean up their mess.”   

The suit cites as evidence Thigpen’s identification of over 4,519 mortgage documents that were filed by DocX with the Register of Deeds and signed in the names of known robo-signer aliases: “Linda Green,” “Christie Baldwin,” “Pat Kingston,” “Korell Harp,” “Jessica Ohde,” “Rita Knowles,” “Linda Thoresen,” and “Brent Bagley.”

“How can we maintain accurate records of title with fraudulent documents?  The banks are also maintaining their own private registry called ‘MERS’ that prevents the public from discovering who owns what loans.  Because there is no accountability for MERS, its records are also a mess,” said Thigpen.  “The system is broken and it needs to be fixed. We’re telling MERS and the banks: you broke it, you fix it.”  

In an April 6, 2011 letter, Thigpen and Southern Essex (MA) District Registry of Deeds John O’Brien urged Iowa Attorney General Tom Miller to investigate MERS and its impact on Registers of Deeds as part of the national attorneys general robo-signing investigation.  The suit cites numerous reasons why MERS fails to keep reliable chains of title, and notes that the recent attorneys general settlement did not address MERS’s and robo-signing’s impact on Registers of Deeds.  

“When you combine the fraudulent documents with MERS, it is difficult if not impossible to trace title for property.  Potential title defects hurt Guilford County homeowners and businesses by impacting property values,” said Thigpen. “We need to clean up chains of title to ensure certainty in the land records system.”

Under Thigpen, the Guilford County Register of Deeds strives to serve as a model register.  The Register of Deeds implemented electronic filing, created an audit software program to improve indexing and correct filing errors, intensified staff training, redacted social security numbers from land records, and significantly upgraded technology.  In 2009, the Register of Deeds received a Local Government Federal Credit Union Productivity Award from the North Carolina Association of County Commissioners for technological innovations.  

“It is unbelievably frustrating to expend County resources in an attempt to create an efficient, accurate registry and have these banks wreak havoc on our efforts through fraudulent documents and a secret registry.  If we don’t fix this now, the future impact on land records and property values could be severe and incurable.”  

“Registries of deeds pre-date the founding of this country and are essential functions of government,” said Guilford County Attorney Mark Payne.  “The Guilford County Register of Deeds has created an outstanding infrastructure, but no registry can work if it is filled with falsified documents.”  

The lawsuit, filed by Payne and Deputy County Attorney Matthew Turcola, describes the process by which the Defendants made and sold loans, created and maintained MERS, filed robo-signed documents, and damaged the Register of Deeds and the people of Guilford County.  Among other things, the suit seeks the appointment of a special master to oversee an audit of the mortgage documents on file at the Register of Deeds and make necessary corrections.  

“While the suit goes into detail on a complex series of transactions, the message is pretty simple,” said Payne.  “We’re saying to the banks: ‘You made the mess, you clean it up.’”  

Guilford County is located in central North Carolina.  Its population is approximately 500,000.  Greensboro is the largest city within Guilford County.  Guilford County was established in 1771, the same year it began its Registry of Deeds.   To assist with the suit, Guilford County retained Talcott Franklin P.C., the nation’s preeminent securitization litigation law firm.  Talcott Franklin P.C. has offices in Dallas, Texas and Davidson, North Carolina.  

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