Mortgage Electronic Registration Systems Inc. and its partner financier U.S Bank of America Corp (NYSE:BAC) face a lawsuit by an Illinois resident on charges of having contributed to a statewide corruption of public real estate records. The case is Daniels v. U.S. Bank N.A., 12-ch-43772, Cook County, Illinois, Circuit Court, Chancery Division (Chicago).
Merscorp Holdings Inc. corporate parent of MERS has been sued in joiner over a privately managed database used to convey mortgage interests underlying the real estates, to MERS s a lender’s nominee without referring to corresponding public/state records .
Charles E. Daniels, who is a homeowner in suburbs of Hoffman Estates, lodged the complaint before the Chicago state court seeking an order that refrains the said banks from the use of MERS records in lieu of public records on real estate borrowings and mortgages transactions. According to him he intends this to be a class action on behalf of all the clients of any of the MERS members including US Bancorp (NYSE:USB) who took a property mortgage facility with the system since 2002.
Alleging that Virginian electric records company and all lenders on its net, to have caused a public havoc Daniel’s said in his complaint that, creation and maintenance of MERS has rendered the public recording system a unreliable “source for tracking the chain of title for property,”. A Chicago based lawyer, Larry D. Drury, who represents Daniel‘s plaint said his client seeks to get the public title records reconstructed by MERS and its constituents.
Mortgage Electronic Registration Systems Inc.’s spokesperson Jason Lobo declined commenting saying it was against company policy to discuss on pending litigation.
Merscorp had also settled another lawsuit instituted by Delaware Attorney General Beau Biden in May this year. This was on charges of deceptive practices including failure to maintain integrity of the records in its database. The database holds chronological records of title deeds which home owners scan to know the chain of ownership on the title to their property. The similar kinds of charges were also brought against the said company by the Massachusetts and New York State Attorney General’s before the Delaware case.
The current case Daniels v. U.S. Bank is also is founded on the same contention of deceptive practices by the company and its partner organizations by creating and updating inaccurate records in the Illinois public deed records.
In a telephonic interview the Tom Joyce spokesman for one of the lenders at Merscorp network U.S. Bancorp termed the lawsuit a baseless saying both his company and it’s co defender are “are quite confident in the outcome.” as the case bears many similarities with many other lawsuits that MERS successfully defeated across the country.
The shares of Bank of America Corp (NYSE: BAC) were down by 0.57% to close at $10.51, shares of US Bancorp (NYSE:USB) were up by 0.22% to close at $31.97.
