A Virginia mortgage lender has sued local title company Homemaxx Title & Escrow in federal court, claiming the title firm did not properly document home-sale closings — causing more than $2.5 million in losses. Lender Springfield Financial sued First American Title Insurance Co Daniel E. Fink Jr. and Homemaxx in Baltimore’s federal court last month. Springfield Financial also named as a defendant J. Scott Morse, an attorney who worked for Homemaxx.

Click here to read the Civil Complaint

Homemaxx and Fink, the company’s manager, have attracted a trail of lawsuits and law-enforcement scrutiny. First American has its own lawsuit pending against Fink in Baltimore County Circuit Court, regarding more than 75 Baltimore City properties for which it issued title and closing insurance.

In December, the court appointed local firm Gray & Associates to investigate the firm’s books. Gray & Associates found that Fink allegedly removed at least $350,000 from Homemaxx escrow accounts, court documents show.

The suits against Homemaxx claim the firm did not properly record deeds and liens for the properties backing mortgages issued by Springfield. First American insured the titles. It also alleges that Fink bought interests in property and ground rents — in which an outside party owns the land beneath a home and collects rent from the homeowner — in several states.

Fink allegedly hid his interest in the properties, often by using trust entities to take title to the properties. Then, court documents claim, he secretly transferred his interest in the properties to third parties, out of reach of his creditors, with the intent to sell them. Fink did not pay off liens at residential closings, and did not record thousands of documents at closings, Gray & Associates claims in court documents.

Fink allegedly spent money taken from escrow accounts on cars, jewelry, vacations, gambling and other personal expenses — spending some on a fellow employee with whom he was involved, Gray & Associates claims. Fink could not be reached for comment. Morse also could not be reached. Homemaxx’s past addresses include Hampstead and Middle River; a phone number for the business is disconnected.

Fink signed an agreement with First American in June 2004 to pay money back into escrow and record deeds, according to court documents, but never did so. The state Department of Financial Regulation , which oversees mortgage lending in the state, opened an investigation of Fink that raised issues but yielded little evidence of mortgage fraud, said spokeswoman Linda Sherman.