Guilford Co. files suit, says 6K mortgage documents fraudulent

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Jeff Thigpen at May 2011 news conference regarding fraudulent mortgage documents (WGHP)

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GUILFORD COUNTY, N.C. -- The Guilford County Register of Deeds is suing dozens of  businesses, including Bank of America and Wells Fargo, alleging thousands of mortgage documents filed in the county were fraudulent.

Jeff Thigpen, who has filed for re-election for his office, announced the suit on Tuesday. A total of 28 defendants are named in the suit, including banks, lenders and other related businesses.

In October, attorneys general in all 50 states settled with Bank of America, Wells Fargo and the other three big banks.

However, Thigpen's suit claims the settlements "do not involve repairing the damage Defendants caused to the accuracy, reliability, and availability of public property records in Guilford County."

County officials said it could take up to 60 days to get a formal response from the companies involved.

The suit claims more than 6,100 mortgage documents were "falsified, forged (or) fraudulently executed" when they were submitted to Thigpen's office.

Thigpen said the lawsuit all comes down to signatures. He pointed to some examples.

"Those two are very significant in terms of their variation. You can look at these signatures and see that they're questionable," Thigpen said.

"4,500 of those documents were robo-signed documents, meaning that the people who signed them had no idea what they were signing," Thigpen said.

Thigpen alleges the signatures were made by companies who signed large amounts of documents, like mortgages, in place of the actual person signing them.

The companies did this, Thigpen claims, so banks could put mortgages together faster to sell off as securities to make money.

Thigpen said that's why he filed the suit: the alleged fraud affects 4,500 real people in Guilford County.

Thigpen said the fraudulent documents make it difficult, if not impossible, for his office to track who actually owns the property.

"Register of Deeds offices were put in place so that people could have an idea of who owns what and that people were who they said they were," Thigpen said.

County attorney Mark Payne said this is the first lawsuit of its kind.

Details of the government's $25 billion deal were released Monday.

Banks will pay roughly $20 billion to help borrowers avoid foreclosure. Most of that money will go toward reducing loans for about a million households that owe more on their mortgages than their homes are worth. A total of 11 million households are in that situation.

The banks will pay the other $5 billion to federal and state governments. About a third of that money to pay about 750,000 Americans who were improperly foreclosed upon from 2008 through 2011. Those Americans will receive $2,000 checks.

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