UNITE D STATES DISTRICT COURT

MIDDLE DISTR ICT 010' FLORIDA

JACKSONV ILLE D1 VIS IO{';

UNITED STATES O F AMERICA

CASE NO. 3:12-cr-198.J2S

,.
AFFIDAVIT I~ SUPPORT O F
REGISTER OF DEEDS JOHN L. O'BRIEN' S
AFFIDAVIT A....D REQUFST fOR
RESTITUTION

LORRAI NE BROW N

AFfiDAVIT OF MARIE MCOONNELL. C.F.E.

COMMONWEALTil OF MASSACHUSETTS
CO UNTY OF BARNSTABLE

Befo re me, the undersigne d notary , on th is day personally appear ed Mari e McDon nell,
C. F.E., the affiant , a person whose identity is known to me. After I adm inistered an oath to
affiam, affianttestified:

Background and Qualifications

I.
My nam e is Mar ie McDonnell , C .F.E., I am over 18 years of age, of sound mind,
WId capab le of makin g this affidavit. The facts slated in this affidavit are within m y personal
knowledge and are true and correct.
2.
I am a Mortgage Fraud and Forensic Analyst and a credentialed Certified Fraud
Examiner ("C.F.E." ). I am the founder and managing m ember of Truth In Lending Audit &
Recovery Services, LLC of Brewster, Massachusetts and ha ve twenty-six (26) years ' experience
in transact ional analys is, mortgage audi ting, and mo rtgage fraud investigation.
3.
I am a lso the Pres ide nt and Chief Executive Offi cer of McDonnell Property
A nalyt ics, Inc., a litigation support and research finn that provides mortgage-backed securit ies
rese erc h services, foreclosure fore nsics, and foren sic tide exami natio ns to enomeys nationwide .
McDonnell Prope rty Analynca also advises and performs serv ices for spe<:ial agents o f the
federal government, allomeys general, county registers of deeds, courts and other go vernm ental
agencies.

AfFlOAVIT OF MCDo!"N [LI. (Ot/I I /1lI 3)

h G [ I OF8

4.
I am the same Marie Mc Donne ll who provided amicus briefs to the Massach usetts
Land Court (4/ 17flOO9 & 6/2912009) and to lhe Massac husetts Supreme Judicial Court
( 1011 120 I0) in lhe land mark cases U. S Bank NafivnaJ AS5OCiafion Y. tbanez and Wtlls Fargo
Bank, N.A , \I. LoRace, 458 Mass, 637 (20 11) in whic h the COIIfU vacated two foreclosures
prosecuted by trustees of sec uritization trusrs.! My seminal contribution was to shift the debate
beyond defective assi gnmen ts of mortgage 10 an examination of the fata l breaks in the chain of
title that occurred due to the uuer failure of the entities that sec uri tized these mortgages to
document the transfers betwee n themselves.

5.
In January 2011, John L O ' Brien, Register of the Essex Southern District
Registry of Deeds in Sa lem, Massac husett s ("Register O ' Brien" ), co mmi ssioned McDonnel l
Property Analytics, Inc. (" MPA") to conduct a forensie examination to lest tbe integrity of his
registry due to his concerns tha t: I ) Mort gege ElecltOllic Registra tion S yste ms , Inc. (" MERS '")
proc la ims W I ils mem bers can avoid recordi ng assignments o f mortgage if they reg ister them
electro nicall y in the MERS~ System ; and 2) due to the robo-sign ing scandal spotlight ing Linda
Green - an employee of DefendanI DocX, LLC - as featured in a 60 Minut es expose on the
subject which firs t aired on Apri l 3, 201 J.
6.

I submitted my findings to Regi ste r O ' Brien on J une 28, 2011 whic h revealed

widespread, systemic, patterns of practice employed by or on behalf of several of tile nations '
largest ban ks that had eroded the transparency and COITUpied the chain of title to real property
records ma intained by the Essex So uthern District Registry of Deeds,

7.

I found that by failing to record assignm ents of mortgage necessary to maintain a

co mple te, unbroken chai n of tide, combined with the recordation of assi gn menls of mortgage
thai contai ned false slalements. misrepresenlalions and omissions or material fact in a feigned
and frau dulent attempt 10 close the gap, resulted in a cort\Jpted chai n or title. My report is
available to the publ ic in its en tirety at : hll p/l salcmdccds.com/ pd rtAud jl.vdf.
8.
In another landmark mortgage foreclosure case brough t on appeal before the
Massachusells S upreme Judicial Court in the mailer of Henrietta Eaton \IS. Federal Nmiol1aJ
Mo" g uge tf ssocimiol1 & Another . 462 Mass. 569 (2012) ("Eaton y, FlJl1l1i e Mae"'), I filed an
amicus brief and I supplemental brief in wh ich I explained how the foreclosure of Eato n's
propert y was grounded in a fraudule nt ass ignment of mongage lhal was typical of what I
ObSCTVed w hile auditing the Essex So uthern District Registry of Deeds.!
I' ve also trained state and federal law enforce ment and regulatory agenci es
regarding detection o f invalid assignments, robe-signing, fraud and misrepresentation in

9.

1 Mc Donn~tt ' l A"'i~II. IJ;-i4 -"" tI>e appeal of US 8a"* Nati(m(Jj Au oc;IiI;"" II. 1""_ -.d W~IIJ F....' o
&m!. NA II. LaRa ~ ,I. ble "" lht Mauac1>uKtr, S~mt Judiciel Court, ~bo i le.' W ",'!-'!!!!!.,IllI:
tppel""ef9llW org!ss,rc h numbuohp? doo=SJC. Hl6'M 4 RCl-SC jlfch .

I Mc ~I t' 1 A",I~", Briq filtd "" Septemb lO. 20 I I on<! M. Sllppl~"'",lal 8'i~f docketedOIl January
30, 2012 in !he ......, 1of H""iella <11011 liS. F~dtraJ Nllfi......J U "'I, <rgtI AssociaUon & Al/OIw , SJC- t Hl4 I ~

. ""illb le oa !he M_
~p!lellal:!ll!I"

b... etu Su pre me Judicial COIlrt', _boite a" 1111 0"1",,'1" mo.
onr/d",olaY dock~ l, oh p?dWS JC.l IQ4 I.

An ioAVIT O f McDo><l'lll. tOlil l/llIJ)

PAG[Z Or 8

mortgage and foreclosure instrum ent s. For exampl e, in March of 20 12, I conducted a one-day
workshop for New York Attorney General Eric Schneiderm an' s staff, United States Attorneys,
and investigators. In February 20 13 I will be conducting a three-da y training in Washington,
D.C. for special agents of the federal government at the request of the Offic e of the Inspector
General for the Federal Housing Finance Agen cy.
10.
My experience in working with tate and federal law enforcement dates back to
the earl y to mid-1990 ' ' when I uncov red a mortgage fraud schem e orche strated by The Dime
Savings Bank of New York , that led to Attorney General investigation in Massachusett s, ew
Hampshire and Connecticut and, ultimately, to rnulti-mi lion dollar settlement award s and relief
programs for consumers.

Forellsic Examination of/he Essex Southern District Registrv

11.
John 0' Brien was the first Register of Deeds in the country to commission a
forensic examination of a Registry of Deeds . He did so because he was troubl ed by the fact that
he could no longer look his constituents in the eye and tell them truthfully who own d their
property. Despite this awareness, Register O' Brien was not prepared for the results of my audi
and when he read my report he declared publically : " My registry is a crime scene."
12.
The result of my investigation revealed widespread, systemic, methodi cal patterns
of practice whereby the public land recording sy tern has been used by the nation 's largest banks
to transfer title to real pr perty that the banks do not own. This is especially true where a
foreclosure is involved.
13.
This charade is being carried out by the filing of a defective, often fraudulent
con veyancing document such as an assignme nt of mort gage, whi ch becomes the " breede r
document" that enabl es the alleged assign ee to obtain all other documents necessary to
extinguish the property owner' s rights and trans fer full legal and equitable title as well as
possession to the fraudster.
14.
Once these docume nts appear in a registry of deed s, they are presumed to be valid
and are relied upon by the public, the courts, title examiners, title ins urance companies, and oth er
stakehol ders as the underlying real property is bought, so ld, financed , and on occasion,
foreclosed upon .
15.
Because it has a direct bearing on the restitution Regis ter O'Brien is seeking from
this Co urt as '1 considers the sen tenci ng of Lorrai ne Brown, I briefly summarize the scope of the
audit and results that emerged as we completed our review of 565 assi gnments of mortgage
which required that we examine some 3,317 title documents.'

3 A true and correct copy of my Report enritl d Forensic Examination OfAssignm ents Of Mortgage
Recorded During 2010 In The Essex Sou/hem District Registry 0/ Deeds, which I released on June 28, 20 I I, is
available on Register O'Brien's website at: tn -/lsalemd eeds.com! df u ' l.

A Fl Dr\V1T OF M eDON L (0 1/11/013)

PAG 3 08

16.
I accepted this asstgrunent on a pro 0000 basis becau se of its high and urgent
value to the pub lic trust, and to edllC.lle the SO Anome~ General who were, at that t ime"
brok ering a settlement with five of the natio n', largest banks in an enempr to resolve fraudulent
foreclosure practices. I also wanted 10 prov e the concept that registries of deeds ac ross all
co unt ies and juri sdictions in the United Sta les are similar ly implll: ted and need to have their
registri es audited as well . Finally , I wanted 10 give consumers, attorneys, regi sters of deeds, tit le
exam iners, and law enforcement agenc ies some guidel ines as to bo w they tal! research the public
records 10 de tect invalid doc uments and gaps in the chain of title that need to be addressed.
17.
I defined the scope of the examinati on by selecti ng all assignments of mortgage
that we re reco rded during the year 20 10 to an d from three of the na tion' s largest banks:
JPMorgan Chase Bank, N,A ., Well s Fargo Bank, N .A., and Bank of America , N .A . Th e sample
was not random or arbitrary; we included every assi gnment that appeared in the Grantor I
Grantee inde x using the registry ' , on line search engine. The study included 147 assignmen ts
involving JPMorgan Chase; 218 assi gn ments invo lving Well s FlII'gO Bank ; and 140 assignments
invo lving BanIc o f America A total of 565 assignments were ex amined.
Th e result s, conclusions and find ing s of the audit my staff and I pe rfo nned for
John O' Brien, Regist er o f the Essex Southern Di stri ct Registry of Deed s include the foll owing:

18.

a. We were able to trace ownership to only 287 of 47 3 mortgages which

translates to a tran sparency rali ng of on ly sixty perc ent (600/. ).
b. 46% and 41 % of mort gage s were either MERS registered or owned by the
Government Sponsored Emerpei ses ( Le., Fannie Maoe, Fredd ie Mac,
Ginnie Mae), respecnvely. Typically ownership of these mortgages is
highly o bsc ure.
c. 31% of mortgages WCTe sec uritized into pu blic trusts (as opposed 10
private tN:,1S), which are typ icall y more discoverabl e through use o f
forensic tools and high cost, subscript ion-based da tabases.
d . Only 16% of all assignments examined are valid.
e . 75% of all ass ignm ents examined are invalid and an additional 8.1% are
que st ionable (req ui re more da ta. )
f.

2W. ofthe invalid assign ments are fraudu lent, 35% are "lobo-signed" and
10% violate the Massachusetts Mortgag e Fraud Slatute.

g. 68 3 assignments are missing, translating to approx imately S180 ,OOO in lost

recordi ng fees per 1,000 mortgages whose current ownership can be
traced .

AnlDAVrr OF M cD o ~~ [ U (0 111 11Ot)

P~G[ ~ 01'

Lorraine Brown, DocK, LL C of: J.PS

1 am profound ly familiar with the style , ronten t and propensity for defects and
misinformation con tained in var ious ass ignments and diSl;;hargcs o f mortgage that were pepared,
elleo;:uted and record ed in the: public records th roughou t the country by and unde r the direction of
Lorraine Brown at DocX , LLC, Lender Proces sing Services (" LPS") and its predecessor, Fidelity
Natiooal lnfoemauon Se rvice s.
19.

20,
Beo;:ause of the dept h and bread th o f my specialized knowledge in this regard,
Register John O ' Brien has requested tha t 1 estimate the cost of aud iting some 5,96 3 documents
generated by DocX, LLC tha t we re recorded in the Essex Southern District Registry o f Deeds, or
registered in the Essex Southern Distric t Land Court Registry from JanUllry 1, 2005 through
0<:100er 31, 2009.
2 1.
Register O 'Brien informed me that during this time period a total of 5,688
dischar ges of mortgage and 275 assignments for a total of 5,963 docwnents were
recorded/eegrste red by DocX, LLC in the Essell Southern District Registry of Deeds and Land
Co urt Registry.
22.
I have had the oppo rtun ity to conduct a prelim inary review of a representati ve
sampling of these documents and fou nd that in addition to the fact that tltey are adm itted
forgeries <Su: Lorraine Brown' s test imony and Plea Agreement with the Department o f Justice),
the maj ority o f these doc uments evidence gaps in the chain o f tit le or consti tute wild deeds
~use they fail to connect the ori gina l mo rtgagee with the entity who is d ischar ging or
assigning the mortgage.
23.
Register O ' Brie n has also determined that a total of 10,567 Docx, LLC
di schar ges and assignments were recorde d by in his Registry of De eds from 1998 through 20 11.
I have reviewed a sampling of these earlier docume nts and can attest to the fact that they bear the
same infirmit ies as the DocX, LLC documen ts involved in Count One o f the United States
Attorney ' s case now before th is Court.
24.
Register O' Brien is concerned that the Doc x , LLC documents wh ich have been
record ed against tbe title to his constituents' propert ies are now vo id as a matter o f law due to the
admission of Lorraine Brown that they are for geries. Moreover, thes e DocX, LtC filings (most
ofwhich do lIot illVlOlw prop n it s 'h al art 0' haw beell i" f o'ed osll,t ) are defective for other
reasons and further compro m ise the good, clear and marketable tit le to rea l prope r ty that Register
O ' Brien' s constituents have a right to ex pe<:t.

Restitution Calculus
25.
When consideri ng restitution for the victi ms of Lo rra ine Bro wn 's lIC t;on s, the
Court should undefswt,d that there is no simple "fix~ that witt undo the damage caused by the
recordation ohpprox imately one m illion (1,000,000) forged documents in the nation ' s brick and
motUr land recording facilities.

AfTT llAVn Of'

M cDo~N [ LL (0

111 1... tJ)

26.
The problem o f rep laci ng an otherwise valid conveyancing document tha t has
bee n executed or no tarized by a robe-signer or a surro gate-signet ean be cured by recordin g a
correc tive doc ument that has been duly acknowledged by a corporate officer who has personal
knowledge o f the facts co ntai ned therein and who is properly authorized.

27.

Howe ver, my preliminary research and rev iew of the subject documents prepared,
execu ted and recorded by Docx, LLC indica te thaI there are ot her issues that must be addressed
as ....'el]. For exam ple:

The entity purport ing 10 discharge or assign the mortgage is not the ori ginal
lende r and did no t estab lish its authority to act by wa y of an ass igrunen t or po wer
ofattorney. Accordingly, the DocX document reveals a break in the chain o f tille .

A power of attorney referenced in the DocX doc ument was no t recorded; or does
not cover the situa tion a t hand.

The assignment of mortgage purports to convey the note and mortgage from the
lender directly into a securitized trus t years after the trust closed . S uch a
conveyance is a legal impossibility and indicates that the assigrunent is a
dece ption.

28.
Based on my prior experience of havi ng conducted McDonnell Propert y
A nalytics' Foremic u amiooJion OfAssigwnefl/s OfMorlgage Recorded During 1010 In TM
Essex SoutMrn District Registry OfDeeds. and in view of the facllhat the vast majori ry of the
DocX, LLC doc uments are discharges of mortgage rather than assignments, I estimate that lr
wo uld cost $3 75.00 per property to identify tbe damage 10 the chain of ride caused by these
forged and fraud ulent filings.

29.
Consideri ng the fact that there are appro~imately 1,000,000 DocX doc umen ts on
recerd and rhat the Essex Southern Districr Registry c f Deeds is known to con tain 10,567 of
these, or about 1.06"'. . 1 believe tha t it would be helpful to the Court and to the public at large to
conduct a study on 1,000 (0.1f)"!.) of these quest ioned documents to ident ify the defects and
recommend a repair process.
30.
I would design an audi t plllll thai maps out the types of doc ument and title defects
that exist in the conlro l iffluP; idenrify the DocX client who ordered the doc ument; and
recomme nd tbe steps that WQUld need to be taken to rectify the defects.
3 1.
I would ab o consul t wi th a number of title insurance companies and several of
DocX 's major cl ients to discuss the feasibility of restorin g clouded titles w ithout having to resort
10 the j udicial process.
32.
Finally, I would co ns ult with a variety of techn ology providers to detennine how
we migbt use technology to ide ntify the DocX doc uments as well as gaps in the chain o f title that
resulted from these filings.

AFFID" \ IT Of M c DoNNELl. (0 1/ 1 11013)

33.
[ pro pose , therefore, that the Court award Regi ter O'Brien an additional urn of
money to cover the cos t of this sampling and the preparation of a report that would recommend a
methodology for rep airing the damage as follows:
Title Examination: 1,000 d cuments/propcrties @ $375.00 =

375,000.00

ubscription-Based Services c.g., Bloomberg, ABSNet Loan :

$24,000.00

Compile Data; Stati tical Analysi ; Write Report:

$75 ,000.00

Consultants; Legal, etc.:

$ 15,000.00

Printing; Mail; T ravel; etc.:

3,0 15.00
492~O lS.00

Su bscribed and signed voluntarily, under penalty of perjury, purs uant to the provisions of 18
.S.C. 1621.

MARIE MCDONN ELL, C.F.E., Affi ant

lv/ortgage Fraud and Forensic Analyst
Certified Fraud Examiner, ACFE
arie McDonnell, President & CEO
cDo nnell Property Analytics , Inc.
P.O . Box 2067, Orleans, Massachusetts 026 53
774-323-0892 Office) I 774-323-0894 ( -ax)
E-Mail: Mar ia.mcdonnellan alvti cs.com

PAG 708

CO MMON WEA LTIl O F MA SSACH USETTS

COUNTY OF BARN STABLE, 55

At Brewster , Massachusetts, on this I I ill day of January 2013, before mC, the tmden igned

aulhorily, personally appeared MARIE MCDONNELL. proved to me through evidence of

identity, to wit: a

M~husells

Driver' s License , (0 be rhe signer(s) o f the eueched document,

and who swore Of effirrned 10 me, under the penalties of perjury, lhal the conte nts of said
documenl are truthful and accurate, 10 the best of her knowledge and belie f.
Su bscri bed 10 and swo rn before me .

~/- I' ~f-Notary Public

AT.... Copy ..._

CttRIST1NE M, MUIlPHV

M y Commission el<pires:_~MIa
.... ":'~O;;;
TNlY PUBLIC
...,....... I1,!Oll

AFPIOA" IT OF M cOoN'EU. (Ol llI I8I J j