Illinois fines first company in foreclosure document probe

Department of Financial and Professional Regulation finds evidence of ‘negligence or incompetence’ by New Jersey-based PHH Mortgage

The state of Illinois said it found evidence of “negligence or incompetence” in PHH Mortgage Corp.’s foreclosure procedures and levied a fine of $290,000.

The order, issued late Wednesday, comes eight months after the state’s Department of Financial and Professional Regulation began investigating 20 state-licensed mortgage companies. It is the first disciplinary action taken.

Mount Laurel, N.J.-based PHH, along with 16 other companies, remains under investigation by the department. PHH did not return phone calls seeking comment.

The state, which asked PHH for 10 complete foreclosure case files, also looked at 20 cases that foreclosure law firm Fisher & Shapiro LLC admitted in Cook County Circuit Court may contain faulty foreclosure documents. In 19 of those cases, state investigators found evidence that PHH had submitted signed but incomplete paperwork to Fisher and Shapiro, with notations that other relevant facts would later be added.

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