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MERS Announces Retirement of President and CEO R.K. Arnold

""Merscorp Inc."":http://www.mersinc.org (MERS) says its president and CEO, R.K. Arnold, who has been with the company since it was founded 15 years ago, has resigned.
[IMAGE] Paul Bognanno, former chairman of private mortgage insurer Radian Guaranty, will serve as interim president and CEO and lead the company's search for Arnold's permanent replacement, according to a statement from MERS. Arnold will serve in an advisory capacity to help facilitate the transition.

""I am proud of the important value that MERS provides to our nation's housing finance system,"" Arnold said. ""It is with great honor and pride that I have committed nearly 15 years to helping to grow MERS. After completing my work assisting in a smooth transition, I'm looking forward to enjoying the next chapter of my life.""

The company passed off the media buzz of Arnold's impending departure as an unfounded rumor when asked

[COLUMN_BREAK]

about it last week. A MERS spokesperson told DSNews.com as recently as Thursday that reports of Arnold's exodus were ""flat-out not true."" But over the weekend, the company posted an official announcement to its online newsroom disclosing Arnold's retirement.

The executive shake-up is reportedly tied to the controversy surrounding the MERS System, an electronic registry of ownership and other mortgage rights that was developed with the support of a number of ""major industry players"":http://www.mersinc.org/about/shareholders.aspx, including Fannie Mae, Freddie Mac, the Mortgage Bankers Association, and several major mortgage servicers.

MERS was created by the mortgage banking industry to streamline the mortgage process by eliminating paper assignments when trading mortgage loans and replace the need to file mortgage transfers with individual county record offices. With the complex secondary market model, the system is intended to allow lenders to electronically track changes in servicing and ownership rights over the life of the loan.

MERS says its database holds over half of all outstanding residential mortgages in the United States.

The system has drawn criticism and been embroiled in a slew of legal disputes over whether or not ""MERS"" has the legal right to foreclose on behalf of lenders and servicers.

Questions surrounding the registry and assignments of noteholder ownership have garnered even more attention in recent months with the discovery of flawed foreclosure processing practices at a number of major servicing shops.

About Author: Carrie Bay

Carrie Bay is a freelance writer for DS News and its sister publication MReport. She served as online editor for DSNews.com from 2008 through 2011. Prior to joining DS News and the Five Star organization, she managed public relations, marketing, and media relations initiatives for several B2B companies in the financial services, technology, and telecommunications industries. She also wrote for retail and nonprofit organizations upon graduating from Texas A&M University with degrees in journalism and English.
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