California Attorney General Jerry Brown late Friday ordered the government-owned Ally Financial to stop foreclosing on homes in the state if it cannot prove immediately that it is complying with state law.

Brown, who is running for California governor, issued the order after an Ally Financial employee described as a foreclosure specialist recently admitted he signed off on hundreds of legal documents a day without examining them. In several cases, the legal documents weren't signed in the physical presence of a notary public.

Ally's mortgage unit, Residential Capital Corp., which also uses the trade name GMAC Mortgage, is facing court challenges on some of its foreclosures due to processing and procedural mistakes.

Certain foreclosures in 23 states have been halted and are under review by the company. (See related story on this website.)

Friday afternoon GMAC issued an expanded statement about the situation, saying, "Preserving the integrity of the foreclosure process is of the utmost importance. Regrettably, a procedural error was found to have occurred in certain affidavits required in certain states. The error is not related to the accuracy of the underlying transaction or the ultimate decisions to have exercised the foreclosure proceedings."

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