Foreclosure Defense 101 Lesson 3: Don’t Argue the Legitimacy of Robo-Notaries

Steve Dibert, MFI-Miami

What are Robo-Notaries?  Robo-Notaries are usually local title agencies getting paid by Depositors and Trustees to act on their behalf.  Robo-Notaries came to the forefront of the foreclosure debate last year when Judge Schack questioned their legitimacy because the Notaries often signed for more than one Trustee or Depositor.   Since then, neophyte lawyers in foreclosure defense and mortgage activists have been trying to argue that this constitutes fraud.

Just this week, there was a class action suit filed in Federal Court in Miami claiming that the law firms and Trustees that utilize Robo-Notaries and MERS have committed massive fraud and racketeering against the people of Florida and the plaintiffs are seeking damages of $7.5 Billion.  This case will fall apart for several reasons but that’s an article I’m going working on for next week.

Here’s an example of how Robo-Notaries work and why they are perfectly legal.   Let’s say I’m out of town and I pay Cindi Dixon at Mela Capital (who also does audits) to sign up a client for MFI-Miami and she hires her friend to notarize the authorization to request information.  As the owner of MFI-Miami, I am aware of this and I have authorized Cindi to sign as “3^rd Assistant Vice President of MFI-Miami”.  This is not illegal nor does it constitute a violation of UCC.

If Cindi’s signature or the Notary’s signature does not match other documents they may have signed in the past and Cindi and/or the Notary attests in court to the fact that the signature on the document is indeed their signature then it is their signature.   At this point the Homeowner’s argument becomes a mute.

Usually what the attorney or the Pro Se litigant will do next is make the argument that this is a conflict of interest because Cindi also operates a forensic auditing company.  This is also a mute point because I am fully aware what she does and she is fully aware of what I do and I hired her anyway.  This bears no relevance on the homeowner’s case.

Where is the battle is won is by understanding and making a compelling argument about how the securitization process is flawed on the investor level not arguing the legitimacy of a Notary.