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“It turns out that many of the major law firms responsible for managing foreclosures for the GSEs also have a controlling interest in the ancillary service firms that generate the variable fees that appear as ‘costs’ on the lawyer’s bill. Many law firms either outright own, or their partners have a significant interest in, the company that is posting and publishing notices; or they may own or have an interest in the company that manages process of service, as well,” Jackson said.

Because federal dollars are involved, the Obama administration or Congress may get involved, Olson said.

“If federally supported housing institutions are involved and it’s hurting their bottom line and it seems like they’re being cheated, … there’s every reason for Obama administration or Congress or both to try to gin up an investigation if they think money is needlessly going to the legal sector,” he said.

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