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Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Articles are added several times per day and listed in date order.

Author/ Contributor




In the 1930’s, 25 states enacted moratoriums on foreclosures. The Michigan Moratorium Act meant that anyone facing foreclosure got an automatic 5 year stay on the foreclosure, with a judge ordering a reasonable payment based on the homeowner’s ability to pay

National Moratorium These laws were upheld by the U.S. Supreme Court in the case of Home Building & Loan Building Association v Blaisdell, which held that the people’s right to survive during an economic emergency superseded the contract clause of the U.S. constitution. The moratoriums were not a result of the generosity of the legislatures or the courts, but were a direct result of the actions of workers and communities flooding the streets and preventing the foreclosures that were being carried out. The legislatures and courts essentially ratified the moratoriums that were won in the streets.
March 2012

White paper

Bank Delays in the Resolution of Delinquent Mortgages:
The Problem of Limbo Loans

We find support for an operational risk hypothesis in which the impairment of property rights contributes to both the likelihood that a loan will remain in limbo and the length of time spent in limbo.

Linda Allen
Zicklin School of Business, Baruch College, CUNY
Stavros Peristiani
Federal Reserve Bank of New York
Yi Tang
Fordham University
In particular, we find that the presence of the Mortgage Electronic Registration System (MERS) in both assignment and foreclosures significantly increases both the likelihood and severity of the time spent in limbo, such that a 10% increase in the presence of MERS in county foreclosures and assignments adds around 8 months (3.5 months) to the time spent in foreclosure limbo (non-foreclosure limbo). Lost documentation affidavits are found to be required to move these loans to resolution more quickly.

Searching shadows for end to foreclosure crisis

The implication is that if we can just find a cure for these loans and homes -- either by matching buyers with houses or helping the borrowers stay put -- the economy will be able to heal at last.

Boston Globe Later, Lewis calls up the parties in another case, Nationstar Mortgage v. Sands. The homeowner tells the judge he thought a loan modification had been finalized, allowing him to keep the home, until a lawyer called to say it was back in foreclosure.

"That's ridiculous," Judge Lewis tells the bank's lawyer. "I'm not doing this thing two or three times. You're making my head spin."

Occupy Movement Supporters Consider Eminent Domain as a Tool to Help Homeowners in Foreclosure

OpEdNews Michael Sauvante noted that eminent domain applies not just to real property, but to contract rights as well. Specifically, it would apply to the mortgage contracts and promissory notes held by big banks against the homes of millions of people. He noted that suggestions to use eminent domain on behalf of beleaguered homeowners would surprise those campaigning against the power following the Kelo decision, including some who have had victories at the state level, as in the case of this legislation in New Hampshire.

Defective Foreclosures Rampant

You Have To Own the Mortgage

Not only did Deutsche Bank decline to say if it owned the mortgage, it challenged the very concept of ownership, as if the mortgage transactions of the past half-decade were so complicated it can no longer be determined who owns what.

jdsupra “I don’t know how much more straightforward you can be,” Wallace says. “I just wanted to know, given the odd way they were named, does Deutsche Bank own this or not. I was surprised to see they wanted to have it both ways.”

Foreclosure prevention workshop gets ‘tremendous response’

A state program though, the Illinois Foreclosure Prevention Network (IFPN), a multi-agency effort coordinated by the Illinois Housing Development Authority (IHDA), gathers all these resources together in a “one-stop shop.”

Chicago Sun-Times “We had our first homeowner here at 7:20 a.m.,” nearly two hours before the event began, IHDA Director Mary Kenney said. By 11 a.m. satellite parking areas had to be opened to accommodate participating homeowners.

“It’s been a pretty tremendous response,” Kenney said. “We registered 250 homeowners in the first hour 

Metro Dream Homes founder gets 150-year prison term

Fredericksburg From 2005 to 2007, Williams and three co-defendants, used various corporate names to target homeowners and purchasers to participate in a purported mortgage payment program.

Two deaths in a week linked to Las Vegas corruption probe

The case to which the pair are linked involves allegations that straw buyers obtained homes and condominiums during the Las Vegas Valley housing boom nearly a decade ago

Reuters The two deaths bring to four the number of people linked to the Justice Department probe.

Authorities said they suspect no foul play in the death of Amesbury, who had an earlier brush with death in November when he was found badly beaten and in his underwear inside a gated community in an attack that was never solved.


The Securitization Curtain is Lifting in Hawaii!

“One of the most important decisions for Borrowers Rights in the history of Hawaii has been made with this decision,” remarked Honolulu attorney Gary Dubin.

Deutsche Bank National Trust Co. v. Williams

Deadly Clear Understanding the premeditated intentions of these banks, how they pledge, collaterize, swap, sell, lease, and trade these loans that are SUPPOSED to have been in a static trust will open the eyes of lawmakers to the real moral hazard – the fraud upon the homeowners, the courts and the state.

Jim Bickerton profoundly says that, “every foreclosure in the state is a victim of this shadow banking scam.


Failed bill on foreclosure filing in Colorado may get second chance on November ballot

"Title records now are being totally messed with. Colorado's foreclosure process today is fundamentally unsound."

Denver Post Undaunted that legislators killed a bill requiring that lenders prove their right to foreclose on a home, backers of the failed proposal have filed it as a ballot initiative with a harder approach: Foreclosures can't happen unless all loan papers are properly recorded with the county first.

"In other states, courts are scrutinizing whether the foreclosing party has the right to foreclose and concluding that in most cases (they haven't) demonstrated that right with proper documentation,"



Foreclosure Prevention Workshops

Saturday, March 31st, 9AM-2PM
Morton West High School
2400 Home Avenue
Berwyn, IL

ABC The event is designed to help provide struggling homeowners with access to quality assistance and information they need to avoid foreclosure. At the March 31st event, homeowners facing foreclosure can access free counseling services, legal advice, mortgage payment assistance programs and tips on how to avoid mortgage fraud.


Study: Prosecutors Not Disciplined for Misconduct

It paints a bleak picture about what’s going on with accountability and prosecutors.”

Texas Tribune In 91 criminal cases in Texas since 2004, the courts decided that prosecutors committed misconduct, ranging from hiding evidence to making improper arguments to the jury.

None of those prosecutors has ever been disciplined.


Borrower Beware: Bank of America  Customer Repaid Her Bill Yet Faced a Collections Nightmare

American Banker Karen Stevens spent nearly $1,900 paying off delinquent credit card debt she owed Bank of America in 2006. She then spent another three years fending off demands from collections agencies that she repay the debt all over again. 


MERS foreclosure issue headed to Oregon Supreme Court

Oregon Live If the high court gives the system a thumbs down, it could throw a wrench into thousands of pending foreclosures in Oregon and potentially upend thousands more already completed.

Foreclosures Still Ravaging Families and Communities

On the banker side, as the years have gone by we are discovering breathtaking malfeasance and even systemic fraud

LandO'Lakes Patch In the Great Depression, Franklin D. Roosevelt’s Home Owners’ Loan Corporation provided real relief to Americans, saving 80 percent of the homeowners who entered the program. By contrast, HAMP and other wimpy programs out of the current administration have had closer to a 2 percent success rate. Our regulators and legislators have been captured by the banks and Wall Street, and they are loath to do anything to relieve Americans. 

Bank of America and Fannie Mae to Steal Home on Tuesday, April 3

This must stop. Millions of families have been shattered with millions more to come. The end needs to come April 3, 2012: America needs to keep Ms. Davidson in her home, because there are families fighting the same struggle as Ms. Davidson in every burg in this nation.

HPN Whether Bank of America and mortgage owner Fannie Mae are guilty of negligence, misrepresentation or outright fraud, their malfeasance will culminate on Tuesday, April 3, 2012, when Ms. Davidson is scheduled to be locked out of her home of 23 years.

Our Government Blessed Foreclosure Fraud

The mortgage settlement signed by 49 states and every Federal law enforcer allows the rampant foreclosure fraud currently choking our courts to continue unabated

Abigail Field The bankers don’t limit their lying, cheating and stealing to homeowners. They abuse their clients the same way. Most broadly damaging, the bankers steal from taxpayers on a federal, state and local level and practically everybody else too. Fraud is just how they do business. When dealing with bankers, you can’t do business on a handshake

Impossible? Home Prices Drop Again in 16 Metro Areas

It’s time to face up to the world of reality — title will never be cleared without the signature of the dispossessed owner on a brand new document — and this time the signature better be real.

Neil Garfield

Living Lies

The news media has been fast to report the fines and penalties against the banks for wrongful foreclosures but very slow to report or investigate what happens to those wrongful foreclosures. No fine or penalty will ever correct title deficiencies. 

MERS Judge Sets Aside Bankruptcy Court’s Critical Ruling

BusinessWeek “What the judge wrote is dicta,” Bassias said, referring to Grossman. “Dicta means it’s not a binding decision. He’s specifying everything MERS does that’s wrong. This judge did not address whether what MERS does is right or wrong.”

House Democrats Try to Stop Foreclosure Fraud Settlement Beneficiaries From Getting Hit With Big Tax Bill

If you are one of the lucky few eligible to receive a principal reduction from the settlement, when the banks aren’t paying off their penalty bulldozing homes and waiving deficiency judgments, you have to reckon with this: because of the expiration of a Congressional law, every dollar you receive in principal reduction would be viewed for tax purposes as income, and thusly taxed.

David Dayen


Think about how absurd this all is. Homeowners were ripped off, often by faulty appraisals artificially increasing the value of their home at purchase. They were steered into bad loans at the height of the bubble, and then the bubble collapsed. Now they are massively underwater, and they lost all their equity in the home. It turns out that was largely done illegally. And now if they are lucky enough to get a chance at relief, surprise! They’ll get a hefty tax bill they can’t pay for the amount of restructuring their loan.

State AG To Federal Appeals Court: 'MERS Has No Business Interfering In Oregon Non-Judicial Foreclosure Process!'

Oregon Attorney [General] John Kroger fired a shot across the mortgage industry's bow Tuesday, arguing for the first time that a national electronic loan registry can't trump state records laws.

Home Equity Theft Reporter The state Department of Justice filed a brief in the 9th U.S. Circuit Court of Appeals, arguing that the Mortgage Electronic Registration Systems, or MERS, can't stand in for lenders when it comes to county records in what's called "a non-judicial foreclosure" -- one that does not go through court.

Hooker v. MERS, BofA


Deutsche Bank Wasn't Cleared To Foreclose In Ark., Suit Says

Deutsche conducted many foreclosures and foreclosure sales in Arkansas without obtaining the proper certificates from the secretary of state, invalidating all of the related title transfers.

Home Equity Theft Reporter


Deutsche Bank National Trust Co. was hit with a proposed class action in Arkansas seeking a declaration that the bank wasn't authorized to operate in the state when it foreclosed on homes and transferred their titles in 2010.

Complaint: Dial v. Deutsche Bank


Bad Mortgage Case Draws Consumer Financial Protection Bureau To Homeowner's Side

Judges across the country try to determine whether borrowers who took out loans at the height of the subprime bubble, under shady terms that they weren't told about, can cancel their mortgage and walk away debt-free.

Huff Post Rosenfield took out a 50-year mortgage with a variable interest rate that her complaint said averaged 10.5 percent. It also included a balloon payment of $351,907 due in 30 years. Had Rosenfield somehow remained current on her payments for 30 years, she would have paid the lender a total of $813,812, with just $36,093 in principal.

Ohio Man Facing Eviction, Fatally Shoots Wife And Himself

Tragically, as the foreclosure crisis has hit millions of Americans, eviction-related suicides have become more common.

Huff Post Millions of Americans are at risk of losing their homes to the foreclosure crisis, and sadly some would rather face death than eviction.

Bank Of America Sanctioned For Discharge Violation

Bankruptcy Judge Arthur B. Briskman recently smacked Bank of America to the tune of $12,500.00 for violating a debtor’s discharge. 

In re: Humphrey

The testimony at trial was that agents of Bank of America stated that they didn’t really care about the bankruptcy and that they would keep calling until the computer system was updated.

naked capitalism I suggest you read this filing in full; it’s pretty comprehensible on its own. For newbies to this sort of thing, one thing that is it important to understand is that all the documents pertaining to a specific mortgage (the note, the mortgage, which is the lien on the property, title insurance, etc) go in a single file called a collateral file.

Bank Of America Sanctioned For Discharge Violation

Bankruptcy Judge Arthur B. Briskman recently smacked Bank of America to the tune of $12,500.00 for violating a debtor’s discharge. 

In re: Humphrey

The testimony at trial was that agents of Bank of America stated that they didn’t really care about the bankruptcy and that they would keep calling until the computer system was updated.

Bankruptcy Law Network Shockingly, Bank of America did not attend the evidentiary hearing set by the Court. However, even if they did attend, I doubt there was much they could have done to prevent Judge Briskman from imposing the same sanction. Doing a little research, this is obviously not the first time getting smacked for the bank.

Debtor’s attorney sent several letters demanding that the calls stop; however, these letters fell on deaf ears. 


A.G. Schneiderman Announces Up To $15 Million Of National Mortgage Settlement To Extend Funding For Foreclosure Prevention And Other Related Services

New York Attorney General "This funding is truly a lifesaver. Without Attorney General Schneiderman’s intervention, funding for foreclosure prevention services would have expired and homeowners in need of assistance would have been abruptly cut off. Now, countless families across New York will have access to the legal services and housing counseling they need to save their homes and stabilize their community."

Essex register of deeds turns fire on Freddie, Fannie

“If a private citizen or corporation sells a piece of Massachusetts real estate, they are required to pay a deeds excise tax. 

However, Fannie Mae and Freddie Mac pay nothing.

BizJournals Southern Essex Register of Deeds John L. O’Brien Jr. said Wednesday he is asking the state to sue Fannie Mae and Freddie Mac over unpaid excise taxes on property transfers.

Entities that have shareholders and pay millions in salaries to top executives should not enjoy tax exemptions, O’Brien said.


NJ Appeals Court: Bankster's Failure To Submit To Court Certification That It Notified Defendant Of Lawsuit Sinks Foreclosure Sale

LaSalle Bank as Trustee v. Plata

Home Equity Theft Reporter


Superior Court of New Jersey, Appellate Division.

The court ruled that LaSalle’s failure to prove that it had properly sent the notices caused the sale to be defective, and the court ordered the sale to be vacated.


From Big State a Call for Small Banks

Having seen the biggest banks make risky bets, crush the economy and get rewarded leaves "a residue of distrust for the government, the banking system, the Fed and capitalism itself," Mr. Rosenblum wrote.

ProPublica The lead essay, which is endorsed by the president of the Dallas Fed, contends that despite the great crisis of 2008, a cartel of megabanks is still hindering the economic recovery and the institutions remain too big to fail.

Federal Reserve Bank of Dallas Report



The Wall Street-Washington Connection

Georgetown University With Eliot Spitzer, Matt Taibbi, Ron Suskind, Van Jones, Heather McGhee, Jesse LaGreca


Mortgage Termination Lawsuits Do Not Give Associations Clear Title

The largest title insurance company in Florida (Attorneys’ Title Fund Services, LLC, also known as “The Fund”) recently published an opinion by its underwriting counsel cautioning attorneys and title insurance companies against closing and insuring any transaction where the association’s title was obtained through a “mortgage terminator” lawsuit.

Florida Condo Blog We are seeing more and more evidence that these tactics ultimately put associations at risk. Associations may have sold such units to third-parties, claiming that the mortgage on the unit has been “wiped-out” by the mortgage terminator lawsuit. In reality, the lender may still have the right to enforce the mortgage. Therefore, an association could be sued by the person who bought the unit from the association and who thought that he or she had clear title to the unit.

If WE owned a pool of loans… would WE allow principal reductions?

Well, the truth is… there’s simply too much involved to make a ‘YES’ or ‘NO’ answer on principal reductions meaningful.

Mandelman Matters Now do you see where the $16 trillion went?

But… if we’re not getting the money from the payments on the mortgages we originally bought, because most or all have defaulted… but we’re still paying the investors who loaned us the money by using borrowed money from the Fed… what’s going to happen when… I mean… aren’t we blowing a giant bubble and one day it has to pop?

Oregon Department of Justice Seeks to Stop Lenders From Wrongfully Foreclosing

“Lenders using the MERS system have to follow Oregon law just like everyone else,” said Attorney General Kroger. “The Department of Justice will not tolerate lenders cutting corners in their rush to foreclose on Oregon homeowners.

Salem-News The legal brief was filed today with the 9th U.S. Circuit Court of Appeals in a homeowner lawsuit challenging the legality of a foreclosure. Oregon law allows foreclosures to be conducted outside the courthouse – so-called “non-judicial” foreclosures – but only if every transfer of the loan documents has been properly recorded.

Pool guy, landscaper of $18 million foreclosure winner subpoenaed

Last year, shortly after appearing on 60 Minutes, Deutsche Bank’s case was thrown out of court after it was ruled it couldn’t prove ownership of the mortgage. It re-filed the foreclosure in May and included Szymoniak’s son in the case even though he is not named on the mortgage. 

Kim Miller

Palm Beach Post

Lynn said the move is unusual in a foreclosure case, and because the requests are so lengthy, including a demand for all communications between the company and herself, she said it’s more likely a form of harassment or an effort to increase court costs.


Do we have another ROBO-attorney?   

Second Amended Answer and Counterclaim in 

Bank of New York v. Bruschuelas

Richard A. Roman, Esq.
Former Judge of the 346th District Court
(7) This last consideration is of particular importance since Ms. Panchencko has caused certain legal pleadings to be placed within the stream of commerce of the
United States (US Postal Service). The general and pedestrian understanding of "mail fraud" is the use of the instruments of the United States Government to knowingly or
negligently commit acts adverse to another party to their detriment (see "6" above). This may have occurred in this case. If, in fact, the actions described hereinabove occurred,
they will have to be reported to the appropriate authorities with the appropriate jurisdiction;

Foreclosure Deal Credits Banks for Routine Efforts

For example, the banks can wipe out more than $2 billion of their obligation by donating or demolishing abandoned houses. 

Banks do things like this — real estate transactions that do nothing to prevent foreclosure — all the time. But beginning this month, they can count such activities as part of their new commitment to help people stay in their homes.

NY Times  

“The $17 billion is supposed to be the teeth of this settlement,” said Neil M. Barofsky, the former inspector general for the Treasury’s bank bailout fund known as the Troubled Asset Relief Program. “And yet they are getting all this credit for practices that they do every day.




Jerking customers around with escrows and precipitating a "default" was a classic mortgage servicing fraud specialty of all of the subprime lenders during the bubble.


MSFraud Forum

When a borrower failed to pay the amounts demanded, additional late charges were added. The lender would also make unfavorable credit reports about the borrower. After a month or two, the lender would begin putting payments into a "suspense account" and not applying them to the loan at all. Borrowers were then told that they were in default and late charges were added every month. An additional amount of several thousand dollars, characterized as attorneys fees or loan modification fees were also added as a consequence of any workout.


The case is Alisa v. Ameriquest, JPMorgan, WM Mortgage

Ninth Circuit COA


Appellees' failure publicly to announce the foreclosure violated the requirements of Hawaii's nonjudicial foreclosure procedure under Hawaii Revised Statute, as well as its consumer protection law. The court voided the sale of the Appellant's property and awarded her treble damages of $417,761.66 under HRS § 480–13 for violation of the consumer protection statute.

Another Victim Of Foreclosure Rocket Docket Scores Relief On Appeal; Rules On Good vs. Crappy Service Of Process Eludes Snoozing Trial Judge

 Baker v. Stearns Bank

Home Equity Theft Reporter Once again, we have a case that illustrates the need for a homeowner challenging a foreclosure in court to (1) understand that trial court judges are quite capable of dropping the ball on a pretty simple, basic issue of law, and (2) be ready, willing, and able to challenge a trial judge's ruling in an appeals court when the situation calls for it, as the homeowner did in this case.

Not-So-Dumb Consumers Shun OCC’s Bogus Foreclosure Reviews

Consumers seem to have wised up to the fact that the Administration is not on their side, particularly as far as housing is concerned.

naked capitalism So do your friends and contacts as favor. Circulate this post to them and urge them to pass it on to anyone who might be a candidate for the OCC foreclosure reviews. Warn them that it’s jerry rigged in favor of the banks and will serve to prejudice any legal action they might decide to take against them.

FHA Bailout Risk Looming Larger After Guarantee Binge: Mortgages

The Federal Housing Administration won’t be able to earn its way to financial health this year, increasing the chance it will need a taxpayer bailout.

“They can’t even track their data correctly,” Caplin said in an interview. “Not knowing how to measure the performance of your borrowers is tragic and profoundly wrong.”

BusinessWeek Until recently, FHA officials chose to direct their “limited resources” to examining loan servicing rather than loan origination, Kanovsky said. In general, the agency trusts lenders to certify the quality of mortgages it guarantees and to report paperwork flaws or possible fraud.

The FHA can negotiate indemnification agreements in which the loan originator reimburses the agency for losses to its insurance fund. It typically requests indemnifications after a loan goes bad or when there are basic underwriting problems with the mortgage, such as missing paperwork or fraud.


B of A's Latest PR Nightmare Is Part Teen Novel, Part Whodunit

We all wish we could have just stayed in bed some days, and Bank of America officials have had more than their share of those days in the past week.

Mortgage Servicing News Bank of America has fielded very public complaints that it has been unresponsive to a prolific author's request for a loan modification on her L.A. home, and that it drove up home construction costs for one man after accidentally reporting him dead to the three major credit bureaus.

Man Blows Up Home During Eviction Standoff

Fox News Fulton County marshals arrived at Wordes’ home around 10:45 a.m. to deliver his eviction notice. After about two hours of trying to reason with him, the negotiations went sour. Around 12:45 p.m. a massive explosion took place from inside the home. 

Insight: Spain's jobless immigrants take on banks over mortgages

The highly public "Stop Evictions" campaign has fed a wave of defiance against banks and the new government has promised relief for borrowers who took loans during a long housing boom.

Reuters In the early 2000s it was easier for a poor immigrant to buy a house than to rent. Landlords in Spain typically ask for a 6-month or even 1-year rental deposit, whereas banks pitched home loans with no downpayment.

Fannie Mae, Freddie Mac Resistance To Principal Reduction Costs Taxpayers

But one powerful obstacle stood in their way: Freddie Mac, the government-controlled mortgage giant, owned the DeCaros' loan.

Huff Post Freddie has a policy of refusing to approve so-called short sales -- those where the purchase price is lower than the mortgage balance -- unless the buyer signs a legal document promising not to resell the property to the original homeowner. The document bars the buyer from even renting the home to the initial owner.

Knock it Off, Nonprofit Tells First One Lending

Courthouse News Neighborhood Assistance Corp. of America claims in Federal Court that First One Lending Corp. and its president John Vescera are falsely claiming affiliation with it and charging homeowners up to $1,800 apiece for "worthless" services.

Local court may decide if lenders avoided the law

Darin Raymond, Plymouth County attorney, claims there's been an intentional effort since 1998 by some national businesses to avoid filing/recording the paperwork and paying the fees.

Daily Sentinel "If the businesses profited from avoiding the fees there should be a penalty which includes re-payment of the fees, (paying) the cost of the legal action by the counties and any other penalties the court thinks are appropriate to dissuade others from doing the something similar," he explained.

Judge rules against Freddie Mac and Fannie Mae in Oakland County in a First-of-its-Kind Lawsuit

WXYZ Action News “They’ve cheated,” Meisner told Action News on Saturday. “It’s cost us millions of dollars, and this is about taking one step toward recovering that and fighting back against the foreclosure crisis.”

Victory in Oakland County Transfer Tax Case Paves Way for Other Michigan Suits Against Fannie and Freddie

Let’s hope these local actions start getting some momentum. With the Federal/state fix underway, it’s the last hope for throwing sand in the gears of the securitization doomsday machine

naked capitalism Michigan law imposes a transfer tax on deeds recorded at the county office. Fannie and Freddie refused to pay that, claiming that they were part of the Federal government and hence exempt. That argument was clearly ridiculous and a Federal judge ruled against the GSEs.

Oakland County v. FHFA, Fannie, Freddie


Use Of Novel Dual Criminal/Civil Prosecution Targeting Sale Leaseback-Peddling Racket Yields Guilty Pleas, Keeps Victims From Getting Boot From Homes

At the time of indictment, the U.S. Attorney's Office Civil Division filed a verified complaint and temporary restraining order to help the original homeowners save their homes. 

Home Equity Theft Reporter The complaint and temporary restraining order sought novel relief that would bring all the individuals and entities that have a stake in the homes before the Court in an orderly process by which the damage caused by the defendants' alleged fraud could be mitigated.

D.C. family evicted after foreclosure nightmare

Many Section 8 tenants panic and don’t fight eviction notices, not realizing they have these special rights granted by Federal law (even if they do, they may be unable to find and/or afford competent legal representation).


Home Equity Theft Reporter In the case of a tenant receiving a Section 8 federal rent subsidy (i.e. a "Section 8" tenant), federal law prohibits a new owner, including foreclosure purchasers and foreclosing lenders, from evicting Section 8 tenants unless they first go to court and prove they’re being economically harmed by having a tenant remain in a building, or show other good cause. 

Mortgage securities investors might sue to stop the settlement

A Bailout by Another Name

Principal write-downs are another backdoor bailout for the banks that brought you the mortgage crisis.

But what the proponents of principal reductions at Fannie and Freddie don’t talk about is what a transfer of wealth from taxpayers (again) to large banks such a program would represent.

Gretchen Morgenson

NY Times

Throughout the crisis and its aftermath, banks have been very good at ensuring that others — whether taxpayers, Fannie and Freddie, or private investors who hold loans in mortgage securities — do more to help troubled borrowers than banks have been willing to do themselves. This refusal to share the sacrifice is a major flaw in the recent foreclosure-abuses settlement that regulators have crowed about.

The Age of the Shadow Bank Run

The new complication is that bank deposits are no longer the dominant form of modern short-term finance. The modern bank run means a rush to withdraw from money market funds, the disappearance of reliable collateral for overnight loans between banks or the sudden pulling of short-term credit to a troubled financial institution.

NY Times  But these new versions are in some ways still similar to the old: both reflect the desire to pull money out of an endeavor — and to be the first out the door. And both can set off a crash.

On top of this problem is the market for derivatives. The quantity of open derivatives amounts to trillions, and these positions are another source of short-term credit risk. So a need for sudden payouts could also prompt a run on a financial institution.


The same fraud scheme continues year after year.

"Until you've been through this, you just don't know that people like that exist," Vogler said, his eyes welling with tears.

Foreclosure postponed for Tulsa couple in long battle with bank

Chase had it scheduled for foreclosure auction, even though the Voglers say it was Chase who told them to stop making house payments in the first place. 

Tulsa World

Steven Vogler said. "On my first phone call to Chase, I had a check in hand and told the customer service rep I was ready to mail it, and her response was 'Don't send that check!' 

Making payments would only complicate the process of trying to qualify for a mortgage modification, Vogler said he was told.


"There's no monetary value determined yet, but we do know it will be more than the $1,500 to $2,000 they would have gotten through the federal settlement," she said. It applies only to consumers who were harmed by one of the banks named in the settlement. 

Oklahoma opted out of the settlement


A Seven-Day Plan to Finally Hold Wall Street Accountable

The Roosevelt administration conveyed to Pecora that “the prosecution of an outstanding violator of the banking law would be the most salutary action that could be taken at this time."

Truthout Under federal law, the knowing filing of a false affidavit with the court is a felony offense of perjury, punishable by a prison term of up to five years. An individual violates laws against perjury whether he or she personally appears in court and swears to a false statement or provides the court with a false affidavit. Individual states have their own perjury laws, which were undoubtedly violated as well.

Gretchen Morgenson: Wall Street Really Does Enjoy A Different Set of Rules Than The Rest of Us

Gretchen describes the Government Sponsored Enterprise (GSE) business model's adverse impact on the global economy. 

Chris Martenson Gretchen Morgenson has earned a Pulitzer-winning career from exposing abuse and conflicts of interest on Wall Street. In this interview, she confirms that there is indeed a second set of rules that our elite financial institutions enjoy, largely unfettered by the constraints that apply to the rest of us.

Canadians Favor Foreclosed Properties in Sun Belt States

Mortgage Servicing News Whether it is due to the weaker U.S. dollar, the large foreclosure inventory for sale, more favorable economic expectations going forward, or all of the above, Canadians are emerging as the largest group of foreigners purchasing residential property in U.S. Sun Belt states. And they do not mind buying foreclosures.

Wells Fargo Should Be Forced to Meet Subpoenas, SEC Says

Wells Fargo failed to hand over documents demanded in U.S. subpoenas and should be forced to cooperate with a probe into its sale of almost $60 billion in residential mortgage-backed securities, regulators said.

Bloomberg “It’s a credit to them that they’ve escaped as many lawsuits or challenges as they have. This may knock them off their pedestal.”

Almost four years after mounting mortgage defaults prompted unprecedented government bailouts of the financial system, regulators are still examining how banks packaged and sold home loans to investors.


Maryland AG Pursuing Criminal Investigations into Foreclosure Fraud

Two Maryland attorneys representing servicers admitted in court documents that they had directed others to fake their signatures on affidavits,

Baltimore Sun Attorney General Douglas F. Gansler also said his office is pursuing criminal investigations related to mortgage and foreclosure fraud, though he didn't say whether cases related to the "robo-signing" that prompted the settlement might be filed.

Fannie Mae, Freddie Mac must pay Oakland taxes, judge rules

Detroit federal judge Victoria Roberts declared a summary judgment Friday for Oakland County in a lawsuit seeking that Fannie Mae and Freddie Mac pay transfer taxes on the deeds recorded by the county.

The Detroit News No monetary award was made in the summary judgment, but Oakland County conservatively estimates its taxpayers could be awarded $1.5 million or more in damages, Oakland County executive spokesman Bill Mullan said Friday.


The real rot on Wall Street, and how widespread it is.

The Wall Street multibillion scandal no one is talking about

The LIBOR trading scandal could turn out to be far worse for Wall Street than its mortgage troubles.

Fortune Traders at a number of banks were given access to the systems that bank officials used to enter the rate so they could overwrite the rates with ones that would better suit them. When the rate went the way Wall Street traders programmed it to do, the banks 

cashed in millions.


Foreclosure fraud alert comes too late for many here

A bogus California law firm (Precision Law Center) scammed hundreds of desperate homeowners into signing on to a sham lawsuit against their mortgage lenders.

Tampa Tribune The FTC persuaded a U.S. district court to halt the operation and seize its assets. Authorities are still investigating and say they also plan to seek refunds for consumers.

Jackson woman files suit to reclaim home.

In the tax sale, NAJ paid $1,563 for it. By law, before NAJ could formally claim title to the property, it had to notify Thomas of her right to redeem it.

Home Equity Theft Reporter Along with an order setting aside the deed, Thomas seeks compensation in the amount of not only what would have been required to redeem the property, but also the taxes that have been paid on it since May 2010 along with 12 percent interest, court costs and attorney fees.

Bizarre Oregon foreclosure law finally off the books

Despite the repeated efforts of Vida resident Scott Rohter to change it in the nearly two decades since the high-profile Neely dispute, the law stayed in place until this year.

Home Equity Theft Reporter HB 4111 requires local governments to sell such property for at least 75 percent of its assessed value, and that any money left over after the lien is paid goes back to the home­owner.

JPMorgan Discloses It Lost in an Arbitration Last Year

JPMorgan breached the contract over and over again,” the arbitrators said in a 72-page decision. “Evidence that compels this finding and conclusion of the one-sided sales and marketing support given to JPMorgan Asset Management and its funds is voluminous.”

  Over time, JPMorgan “stacked the deck” against American Century by pushing in-house funds, encouraging customers to swap out of American Century funds and awarding bonuses for selling JPMorgan products, the arbitrators said.

JPMorgan’s asset management unit had deliberately violated an agreement tied to the purchase, from American Century in 2003, by promoting its own funds at the expense of American Century’s.


Bank of America Launches Test “Mortgage to Lease” Program – Should We Be Impressed?

Relating to the story below.

naked capitalism In other words, banks are so badly hoist on their own petard that they have to consider doing the right thing. But given their track record, I wouldn’t bet on them pulling it off in the way the great unwashed public hopes they will.

Bank of America’s phony mortgages are as fraudulent as fake Prada purses — and they get away with it

Matt Taibbi talks to Cenk about his recent Rolling Stone article, “Bank of America: Too Crooked to Fail.” Taibbi says, “It’s no different than here on the streets of New York where you see people selling fake Prada bags or phony blue jeans. What they were doing is selling phony mortgages… It was a giant fraud scheme. The fraud on Wall Street — they think it’s some kind of abstraction, it’s bankers ripping off other bankers, it’s some kind of insider-trading scheme where it’s a victimless crime. That’s not true — it’s bankers ripping off old people and retirees.”

But, as Cenk points out, “There’s never any consequences. They’re, in essence, too big to comply. They turn to government and go, ‘What are you going to do about it?’”

BofA Tests an Option to Foreclosure
Lender Lets Owners Stay in Homes, Rent From the Bank

"One of the outcomes of the 'robo-signing' scandal is that it is more difficult to foreclose," said Mr. Baker. "It's more worthwhile for banks to pursue alternatives."

WSJ Bank of America is launching a pilot program that will allow homeowners at risk of foreclosure to hand over deeds to their houses and sign leases that will let them rent the houses back from the bank at a market rate.

The Shadow Bailout: How Big Banks Bilk US Towns and Taxpayers

Wall Street Confidence Trick: The Interest Rate Swaps that Are Bankrupting Local Governments

Ellen Brown, Esq. The banks have made outrageous profits by capitalizing on their own misdeeds. They have already been paid several times over: first with taxpayer bailout money; then with nearly free loans from the Fed; then with fees, penalties and exaggerated losses imposed on municipalities and other counterparties under the interest rate swaps themselves.

Gangster Banks Keep Winning Public Business. Why?

Matt Taibbi

Rolling Stone

In modern times, it's the same thing, except that it's banks now doing the pantomiming. Here a circle of organized crooks (read: banks) gets together, parcels out territories so that each party gets to "win" business in certain areas, and then they all get together and agree to a rigged bid system.

Whistle-Blower Lynn Szymoniak Beats the Banks

“It was pretty obvious to me that the paperwork was fraudulent,” she says. It took her “less than five days” of research to conclude that many lenders were using faulty documents as the basis for foreclosures.

BusinessWeek Szymoniak says she was first alerted something might be wrong when Deutsche Bank said it acquired her mortgage note in October 2008, three months after suing her—meaning it might have begun proceedings without having the authority to foreclose.


Max Gardner & Nye Lavalle Together in Concert 

A Mandelman Matters Podcast

"It was not that people stopped paying their mortgages - it was in 2007 when the market froze and people stopped buying securities because they no longer trusted them."

Mandelman Matters Having Nye Lavalle and Max Gardner together is a rare event. Together, they would have to be considered the founding fathers of today’s foreclosure defense movement, so this is an opportunity to learn how it all began and where two of the country’s leading experts see things going from here.


EXCLUSIVE: Plymouth County sues over mortgage recording practices

Plymouth County has filed a class-action lawsuit against a national electronic mortgage registry company it says has enabled banks to avoid paying Iowa mortgage recording fees.

Sioux City Journal Plymouth County is asserting claims of unjust enrichment and civil conspiracy, is seeking an unspecified amount of damages and has asked that the defendants record all past mortgage transactions that were not recorded from Jan. 1, 1998, through the present.



Bank Of America: Home Prices All Done Falling, Thank You Very Much

Huff Post Readers with functioning memories will immediately recall that economists have been getting housing calls wrong early and often -- before, during and after the housing bubble and crash. At one point, remember, it was gospel that house prices would never fall. And we have seen calls of housing bottoms again and again since prices began to fall back in 2006.

  Brokers Turn Millionaires in Veteran Settlement against JPMorgan

CNBC The two men sued a half dozen or more banks for fraud, alleging that the banks defrauded military veterans in U.S. Department of Veterans Affairs home loans by hiding unallowable fees in mortgage documents.

Schneiderman Reaches Another Settlement on Foreclosure Fraud,
This Time With Defunct Steven J. Baum Law Firm

Staff attorney Elizabeth Lynch of MFY Legal Services, who said in a statement that “Steven J. Baum is not off the hook yet. MFY represents a class of people adversely affected by his deceptive practices and our clients look forward to vindication of their rights.”

FDL Stephen J. Baum, the New York-based foreclosure mill law firm which drew attention last year after photos cropped up from a Halloween party featuring its employees dressed as homeless people, reached a settlement with the New York Attorney General Eric Schneiderman over the filing of unverified, unsubstantiated and outright fabricated documents with state courts.

Georgia State Senate Approves Measure Criminalizing Foreclosure Fraud

“Georgia’s current mortgage fraud statute is insufficient and must be revised to criminalize fraud throughout the entire lending process, including foreclosure,” said Georgia Attorney General Sam Olens. 

National Mortgage Professional The Georgia State Senate has unanimously approved HB 237, legislation that will make foreclosure fraud a crime in Georgia. Currently, Georgia law criminalizes fraud during the mortgage process, but specifically does not penalize similar fraud in the foreclosure process. Georgia Attorney General Sam Olens thanked the Senate for their overwhelming bipartisan support of HB 237.

City Attorney To Hire Mortgage/Foreclosure Investigator

The San Diego City Attorney's Office announced Wednesday that will spend a $57,000 state grant to hire a part-time investigator to look into allegations of mortgage and foreclosure fraud.

The investigator will focus on loan modification and foreclosure consultant businesses that take advance fees in violation of state law.

Do you have more information about this story? Click here to contact us

10News Entire article: 

"Violators must be stopped before they take large amounts of money from victims or waste critical months of homeowners' time with false promises and representations," City Attorney Jan Goldsmith said. "By proactively pursuing these bad actors at the beginning of their business dealings with misdemeanor prosecution, we can save many potential victims a lot of heartache."


CEOs Contemplate the Occupy Movement

Once the masses get moving, as you know, they’re hard to stop.”

Ralph Nader Is the Occupy Wall Street movement, and its around the country, the precursor to the giant peoples upheaval that they and their brethren have feared ever since Wall Street collapsed the American economy in 2008 and sent the bill to the taxpayers?

New MBS twist: Sand Canyon sues servicer American Home Mortgage Servicing for releasing loan info

Sand Canyon's Complaint

Alison Frankel


Sand Canyon accuses American Home of making it too easy for MBS trustees and insurers to get hold of underlying loan files. In essence, Sand Canyon's lawyers are arguing that the servicer should be helping it thwart claims that it breached representations and warranties about the mortgages it sold to MBS issuers, not smoothing the way for put-back demands.

Illegal Mortgage Foreclosure, JP Morgan and a Federal Injunction

If homeowners can prove that they were victims of predatory lending practices, then lawsuits against mortgage lenders can potentially reach into the millions.

NewsWire The above ruling will encourage homeowners who lost their property though foreclosure by JP Morgan and Washington Mutual, to re-examine their promissory notes and mortgage terms. The decision guarantees protection for a homeowner from the questionable actions of a lender.


Foreclosure Victims Confront District Attorney

Foreclosures are getting worse and worse,” Pines said. “Banks have used their power to influence local politicians.”

The Star News San Diego District Attorney Bonnie Dumanis was bombarded twice this week by angry community members who confronted her about the foreclosure crisis in San Diego County.

'Whistleblower' Says Mortgage Securitization Still an Issue for U.S. Homeowners

Pham said she was fired for providing an analysis about the banking sector and foreclosure fraud issues involving mortgage-backed securities and robosigning that she said displeased her bosses.

ABC News "Why is one of the most powerful government agencies that can determine the direction of the nation's policies appearing to diminish or deny that the issue of mortgage securitization is a problem?" she said. "If it is a problem, we have a $7 trillion in mortgage-backed securities that has brought chaos to homeowners, whether or not they are in foreclosure."

Where are the Indictments?

If crimes were committed, and indictments don’t follow, the release is much broader than its text.

Abigail Field Knowing you’re submitting false claims sounds criminal, so I talked to a former federal prosecutor with 26 years experience about the language. He agreed, yes, “it’s criminal to submit claims to the government you know at the time they are submitted are false.” As to the “deliberate ignorance” language, he noted that ”federal criminal jury instructions provide that a jury may infer knowledge from a combination of suspicion and indifference to the truth.”

Wall Street Sees Big Profits In Renting Out Foreclosed Homes

Huff Post Critics, meanwhile, contend the federal government is fostering a transfer of wealth of sorts by selling big pools of foreclosed homes to big fund investors and high-net-worth individuals. There's also concern that some of the players who helped create the housing crisis will now benefit by buying foreclosed homes at a steep discount.

Latest foreclosure ruling sides with Utah homeowners
In a split with other judges, jurist says BofA unit can’t rely on Texas law.

In a detailed and sharply worded decision, Jenkins labeled as "fantasy" arguments that ReconTrust exercises its duties in a foreclosure at its Texas headquarters and is, therefore, is governed by Texas law.

See Bell v. Bank of America, Countrywide, BAC, ReconTrust

Bates said attorneys pursuing a proposed class-action lawsuit against ReconTrust would ask Stewart to reconsider his recent decision that tossed out that action.

Salt Lake Tribune "The [default] notice is filed in Utah," Jenkins wrote. "The sale is conducted in Utah, often on the steps of the local county courthouse. Those acts do not occur in Texas."

Under Utah law, only a local attorney or a title insurance company can carry out foreclosures in the state, but ReconTrust had been doing so under its own name, actions that spawned numerous lawsuits.

"This is a decision that’s going to have a long-lasting imprint, not just on the way foreclosures are conducted in the state of Utah, but for foreclosure attorneys all across the country." said Bates


Lynn Szymoniak, Foreclosure Activist, Says $18 Million Doesn't Make Up For Homeowners' Harms

Huff Post Szymoniak's own battle to save her home is one that very few homeowners in Florida ultimately win. Local courts are swamped with foreclosure cases, and judges are profoundly reluctant to rule against banks. In some "rocket docket" courts that specialize in foreclosures, judges issue judgments quite literally within seconds -- and they almost never pose problems for Wall Street.

Defect In Assignment Sinks Lender's Post-Foreclosure Sale Attempt To Boot Ex-Homeowners

The Court of Civil Appeals of Alabama recently reversed a lower court ruling favoring a foreclosing lender and nixed an attempt by the lender to boot the homeowners out of their home after the foreclosure sale already took place. 

Home Equity Theft Reporter The court ruled that the foreclosing lender may have lacked standing to initiate the foreclosure process when it did which would have rendered the foreclosure deed void.

For the Alabama COA ruling, see Byrd v. MorEquity, Inc. 


Another Hidden Bailout: Helping Wall Street Collect Your Rent
Here's yet another form of hidden bailout the federal government doles out to our big banks, without the public having much of a clue.

Matt Taibbi

Rolling Stone

As one hedge fund analyst put it to me this morning: "Help inflate the bubble, create a foreclosure crisis, buy homes in bulk, and rent them out to the same average homeowner."


Failure to Recover: The State of Housing Markets, Mortgage Servicing Practices, and Foreclosures




Statement of Hon, Arthur M. Schack,
New York State Supreme Court


Committee on Oversight and Government Reform







Testimony of 

The Honorable Arthur M. Schack

New York Supreme Court

I have observed many foreclosure problems, including, but not limited to: shoddy paperwork by lenders and/or mortgage servicers;
determining the actual owners of mortgages and notes; and, the disproportionate impact of foreclosures upon minorities and neighborhoods that have a predominant minority population.

Many bank lawyers are reluctant to file the required affirmations under the penalty of perjury. Bank lawyers are afraid of being sanctioned by the courts for filing false statements.


Wall Street Firms: Let Us Rent Out Fannie Mae's Foreclosed Homes

Wall Street firms including Paulson & Co., a hedge fund that made $15 billion betting against the housing market, have expressed interest in foreclosed homes being sold in bulk by Fannie Mae.

Huff Post The Federal Reserve has pressured policymakers to pursue a program that would convert the nation's massive pile of foreclosed homes into rentals. Federal Reserve Chairman Ben Bernanke wrote in a 26-page white paper in January that now would be a good time to turn foreclosed properties into rentals because the demand for rentals is rising, the demand for owner-occupied homes is low and banks remain reluctant to extend more loans to aspiring homeowners.

"Hey, you didn't make your payment this month, your check's short, you're delinquent and owe us fees, even though you really did pay in full and have the canceled check to prove it. And guess what? No one but you cares; law enforcement won't even consider dinging us for it."

The Mortgage Settlement Allows Banks to Steal Without Penalty

So here's the real question: given these metrics, this institutionalization and legitimization of servicer abuse, how did all our meaningful law enforcers do this deal?

Abigail Field Before you give me any, hey, let's be reasonable here, a business needs to operate and we're so big some mistakes will happen, remember what we are talking about: homes; property rights; land records; fundamental fairness. How can the Bailed-Out Bankers be held to any standard other than strict liability when it comes to wrongfully selling a home?

If that metric were in place last year, nearly 20,000 homes could've been effectively stolen from people and the Bailed-Out Bankers wouldn't get in trouble.


Breaking Down the Mortgage Settlement: How Far Does $26 Billion Go?

There are questions about exactly why the banks are being given incentives rather than punishment.

ProPublica If your home and equity were stolen through this criminal felony activity, you might get about $2,000.00.  The felons get to keep the rest of YOUR money, plus their wages made during the commission of these felonies, plus their bonuses and other perks.

So if you had say $500K in equity, you get $2,000 - and the people that should be locked up in prison for the rest of their lives get $498K for committing these crimes, plus wages and bonuses.

This is the outcome when the public does nothing about it.


Supervisor John Avalos Tries to Stop Foreclosures with New Legislation

SF Gate Tomorrow, Occupy Bernal and other groups will take their complaints to City Hall, where protesters will demand city officials immediately place a moratorium on predatory bank evictions, fraudulent foreclosures, and foreclosure auctions. And they are anticipating a happy ending as Supervisor John Avalos, who represents the Excelsior neighborhood, is expected to introduce legislation that will bring unfair foreclosures to a halt.

California Judge Dismisses Foreclosure Lawsuit

Judge Illston said in several cases, California courts have ruled that “it doesn’t make any difference” if the wrong party foreclosed.

The judge has allowed him to file an amended complaint with information to substantiate his claims.

Law & Industry Daily A federal judge in California on Friday dismissed a lawsuit alleging foreclosure abuse by Wells Fargo and the mortgage database MERS.

Boyter’s lawsuit filed in U.S. District Court for the Northern District of California alleged the foreclosure was not legal because Wells Fargo Bank, foreclosure-services company NDeX West and MERS failed to file proof they had a right to his mortgage.


Updated: Foreclosures 'stacked' against borrowers

Read more: AG Harris demands justice for homeowners

OC Register US: When will the Homeowner Bill of Rights be introduced in the state Legislature, and when will it land on the Governor’s desk?
Brian: The California Homeowner Bill of Rights has been introduced in the legislature and will be taken up at hearings soon. There is an Aug. 31 legislative deadline to pass bills, but the urgency of this crisis compels us to act as soon as we possibly can.

More on the Mortgage Settlement Docs: The Vague Release, the “Work Plan” to Be Named Later

David Dayen FDL This formula, “we release everything except certain particulars” is not such a hot structure to begin with when you haven’t done investigations, as in there may be conduct you didn’t discover that surfaces later and it isn’t in your Paragraph (11) list that you are still free to pursue. But even worse, the Paragraph (11) list is poorly drafted. 


Silent Spouse as Guarantor – a Neat Defense

According to conventional thinking, “the spouse is liable under the guaranty, despite her lack of involvement; after all, she signed the guaranty.”

Mark Stop, Esq Not so fast.

I recently came across a case, published by Florida’s First District Court of Appeal in July, 2011, which strongly indicates the ”silent spouse” in this type of situation may be able to avoid liability under the guaranty.

Is it important who forecloses?

(Why does this question even have to be asked?)

In Massachusetts, courts have said "yes" in two landmark cases upheld last year by the state's highest tribunal, the Supreme Judicial Court. Judges in other states have ruled likewise.

But California courts have consistently refused to void foreclosures even when banks botched the process.

SF Gate Last week in San Francisco, the First District Court of Appeals heard arguments in Haynes vs. EMC Mortgage, in which the homeowner asserted EMC should have recorded the deed of trust under the Civil Code. The lower court ruled for the bank. But if the appeals court rules in Haynes' favor, putting it in opposition to the Calvo decision, then the California Supreme Court may take up the issue to resolve the conflict.


Whistleblower Gets Sham Justice From Wall Street Court

In a typical civil courtroom proceeding, if recorded testimony is lost or tampered with, one can expect the case to be dismissed and an investigation begun.

(In FINRA arbitration, the judge and jury work for Wall Street, which is always on one side of the case or the other. Doesn’t seem fair or American, does it?)

Bloomberg It seems hard to imagine that the case would proceed in court without such missing evidence, especially if it could be interpreted as exculpatory and if a verdict rendered against a defendant could destroy his career and force him into bankruptcy.

But, as I have previously written, the arbitration process forced on bankers and customers who have a dispute with a Wall Street firm is about as far as you can get from a court of law.


Judges, you have a solemn responsibility to stand up against all this madness and tyranny.

Matt Weidner, Esq. The lenders made BILLIONS of dollars in insurance claims on the federal government…claims that every taxpayer paid….then it was revealed that an obscene percentage of those claims were false. Got that? Do you see how that works? The big banks submit BILLIONS in insurance claims, the judges still foreclose on homes and vesting the title back into the name of the servicer.

Mortgage Burden for Bales Familiar Story for U.S. Troops

The housing finance setbacks that confronted Army Staff Sergeant Robert Bales, the soldier accused of killing at least 16 civilians in Afghanistan, are one part of his story that many U.S. troops would recognize.

Bloomberg “I continue to hear stories of service members and veterans being ripped off by businesses that see our troops as easy targets for a quick profit,” said Holly Petraeus, associate director of the Consumer Financial Protection Bureau’s Office of Servicemembers’ Affairs.

Yet Another Reason to Hate the Mortgage Settlement: The Release is Botched

naked capitalism Banks aren’t permitted to make errors with your checking account and ding you an accidental $10,000 and get away with it. But with people’s most important asset, their homes, servicers are allowed a certain level of reportable errors, and many of them can be serious as far as borrowers are concerned. 

The Banks Win, Again

When it comes to helping homeowners, banks are treated as if they still need to be protected from drains on their capital. But when it comes to rewarding executives and other bank shareholders, paying out capital is the name of the game. 

NY Times And at a time of economic weakness, using bank capital for investor payouts leaves the banks more exposed to shocks. So homeowners are still bearing the brunt of the mortgage debacle. Taxpayers are still supporting too-big-to-fail banks. And banks are still not being held accountable.


Foreclosure lawsuit to get another chance Is it important who forecloses?

"I'm struggling with the consequences if there were irregularities in the (foreclosure) transaction," the judge said in court.

SFGate The lawsuit focuses on the types of paperwork problems uncovered in the nationwide robosigning scandal and in a February audit of San Francisco foreclosures that revealed numerous procedural missteps.

"California courts in several cases have already said it doesn't make any difference" if there were such problems, Illston said in court, while adding that she is pondering some issues the case raises.


Foreclosing on the commons

Instead of prosecuting peddlers of fraudulent loans and mortgage-backed securities, Obama treated bank executives as gently as Bush administration torturers - which is to say, better than the working class.

But even as activists rack up successes, their achievements are dwarfed by systemic injustice. Bankers and landlords continue evicting and raising rents, even as more than 18.3 million apartments and homes - one in seven US residences - sit vacant. The number of empty units is up more than 60 per cent since 1970. For each of the United States' more than 635,000 homeless people, 28 residences are empty and ready to house them right now.

Al Jazerra But now that the settlement is over and done with, banks can get back to the business of throwing people out of their homes. Indeed, foreclosures - which were already climbing just before the settlement was announced - are expected to increase as a result of the deal, as banks, no longer playing wait-and-see, confidently clear their backlog. If you've already been foreclosed upon, potentially thanks to fraud perpetrated by said banks that, thanks to the settlement, cannot be prosecuted, CNN notes that "you may be eligible for a payment of up to $2,000". In other words, go buy yourself a used Chevy Nova. And sleep in it. 

Neil Barofsky, Matt Stoller, and Your Humble Blogger on Why the Mortgage Settlement Sucks

We as citizens need to stop listening to 30 second sound bites and actively get involved in putting our country back together again. Don’t forget, we elect these corporate shills, it’s what we allow.

naked capitalism Comment: I’ve been watching for 25 years as Americans asleep at the wheel have consistently given up their rights to corporations. In my opinion we are to blame for focusing on divisive issues such as gay rights and abortion while allowing corporations to take over our country. Am I totally disgusted with this settlement? Yes.

Ex-CBO Staffer’s Warnings About Foreclosures Ignored

Dr. Lan Pham, a former senior staffer financial economist for the Congressional Budget Office, was fired from the organization for her attempts to quantify the economic implications of foreclosures and foreclosure fraud.

FDL Keep in mind that Pham is talking about the Congressional Budget Office, not some bank trade group or other entity that makes its money off disputing reality. The opinions and analyses of the CBO are taken as gospel in Washington and used to make public policy in Congress. And they simply had their heads in the sand when it came to the economic consequences of foreclosures and also the very real document fraud issues.

The Good, Bad and Ugly of Capitalism

It confirms the suspicions many people have that Wall Street has become a place where sleazy practices are the norm, and where generating profits in ways that are detrimental to society.

Joe Nocera

NY Times

Goldman bundled terrible subprime mortgages that helped bring about the financial crisis. Smelling trouble, it unloaded its worst mortgage bonds by cramming them down the throats of its clients.

“Making Us Sick:” Occupy Groups 
Target Wells Fargo Board Member Over Foreclosures

Fog City Journal It cites Wells Fargo’s “unique responsibility” as “one of the banks that initiated and perpetrated widespread illegal and predatory practices against homeowners, to lead efforts to fix the housing crisis, rebuild the economy and restore American’s greatly diminished trust of the banking industry.

Attorney general appoints Katie Porter as independent monitor to protect interests of CA homeowners

Related: Katherine Porter Named as Enforcement Monitor for California Side Deal in Foreclosure Fraud Settlement

Lake County News “I will work hard to make sure banks hold up their promises to change troubling practices so that families and communities across California see the benefits of the settlement,” said Professor Porter. “Part of repairing the damage of the mortgage crisis is restoring public confidence that our largest financial institutions will treat consumers fairly and follow the law.”



The $7 Trillion Question That Haunts Banks

Folks, there are $7 trillion of securitized mortgages. It was (mostly) the securitization process that demanded fraud. Securitization could never have been profitable -- it was a flawed way to go about financing homeownership.

Prof. Randall Wray There should be an immediate and complete halt to all foreclosures in the US, and all foreclosures that have been completed over the past decade should be nullified. Yes that will get messy. But continuing with foreclosures will make the mess immeasurably worse. This foreclosure crisis is not going to stop.

The banksters have no legal claim on the homes they are foreclosing. Foreclosure is theft. Any bank that used MERS has no legal claim on property -- there are 65 million such mortgages to which no bank has a legal claim to foreclose.


Mortgage Settlement Money Is For Homeowners, Housing Secretary Cautions State Governments

This brings insight into how detached the state AGs were. After 16 months of "hard" negotiations, and they can't remember who the funds are supposed to go to?  

Huff Post Alarmed by reports that states may divert mortgage settlement money intended to help homeowners, Housing and Urban Development Secretary Shaun Donovan said Friday that he is calling governors and attorneys general to urge them to "do the right thing with the money."

Florida’s Rocket Docket Redux

These senior judges don’t need no stinkin’ laws to do what they are paid to do! Senior “robo-judging” has been back in Jacksonville for a whole two weeks, and there are already stories of one senior judge signing stacks of eviction notices without even reading them while another signed a stack of orders on contested motions without a hearing.

Chip Parker, Esq. It appears that Florida is on the verge of Rocket Docket Redux. It has already started in Jacksonville. The same band of retired judges is set to return to the bench, bolstered by renewed legislative funding for foreclosure court and a new fast-track foreclosure bill (SB 1890/HB 213) that, if eventually passed, will give these senior judges even more power to ignore bank fraud.

Four Whistleblowers Who Sounded the Alarm on Banks’ Mortgage Shenanigans

Buried in the sweeping mortgage settlement with banks, for which final documents were filed this week, are five whistleblower cases that shed light on the litany of foreclosure abuses by the banks.

ProPublica Details are available for four of the cases; documents in a fifth, against JPMorgan Chase, have not yet been filed in Massachusetts. While the cases were settled as part of the overarching agreement, they still have to be accepted by the courts in which they were originally filed. In reaching the settlements, none of the banks admits or denies the lawsuits' allegations.

We've laid out the details of each case.

Servicers and FHA Payoffs: The Root of Foreclosure Evil

For years, I’ve been frustrated beyond belief at the common misperception that delays in foreclosure cases are a result of homeowners or their attorneys. Any contention that homeowners are the cause of delay is a complete and utter farce, and, slowly but surely, I’m developing the evidence to prove it. In fact, it’s becoming apparent that servicers are the root of all evil in the foreclosure context.

At this point, it seems that “robo-signing” was nothing more than a distraction and that the real issue in the AG settlement was the banks’ failure to provide clear title to the FHA in exchange for the monies FHA was paying these servicers after foreclosures were finished.

Mark Stopa, Esq. Why would plaintiffs routinely bid far in excess of a property’s fair market value at a foreclosure sale, essentially shutting out every possible third-party purchaser and ensuring title reverts back to the plaintiffs?

The answer is beginning to unfold, and it’s an awful, awful picture.

Apparently, the vast majority of mortgages entered during the heyday are insured by the Federal Housing Administration (FHA). So when there’s a foreclosure, and the mortgage isn’t paid, the FHA cuts a check. The bigger the judgment amount, the bigger the check.


American Banker Delves into Debt-Collecting Woes at Chase

Columbian Journalism Review JPMorgan's debt-collection practices included robo-signed affidavits, shredded documents, jury-rigged computer systems, hired sketchy third-party lawyers, fired whistleblowers, and emphasized recovering money at the cost of accuracy and ordered employees to take shortcuts to do so. All of this resulted, in the testimony of a whistleblower, in thousands of accounts Chase sold to debt collectors where it didn’t even have the balances correct. 


Foreclosure Fraud Settlement Predictably Leading to More Foreclosure Actions

David Dayen FDL In short, if you want to end the trend of what has been described as an “abating foreclosure crisis,” you would reinstitute the rocket dockets and let banks foreclose on homes with impunity.


A detailed review of 36 of Chase’s foreclosures found that the bank was unable to find any documents related to how much the borrowers owed in 32 of them; there were documents in 4 cases, but docs for 3 of those were wrong. In other words, Chase actually had correct documents needed for foreclosure in only one case out of 36. And these were foreclosures it had successfully completed. In 35 out of 36 cases Chase had simply stolen the home.

Prof. Randall Wray They then proceeded to lose or destroy all (or virtually all) the written documents, broke the chain of title, and screwed up even the electronic records. Nobody knows who owes what to whom, so the loan servicing arms of the biggest banks decided to go on a foreclosure frenzy to seize as many homes at random before anyone found out.

And that required the biggest forgery conspiracy the US has ever seen, with individual Robo-signers admitting to falsifying up to 10,000 documents each per month.

Home wrongfully sold in Livingston County

WHEC Imagine buying a home, putting money into it, then months later finding out you don't really own it. Seems crazy, but it happened to a Mount Morris couple.

50 phone calls uncover flaws in FHFA principal reduction study

The FHFA used the report to determine a wide-scale principal reduction program would cost more than forbearance, while increasing the risk of strategic default among borrowers seeking relief.

Housing Wire This information was not provided in the analysis. Sen. Jeff Merkley, D-Ore., was perplexed and he asked her how she received more information on the principal reduction study than lawmakers in the Senate.

Washington State Supreme Court Briefs

Kristin Bain v. Metropolitan Mortgage Group, Inc., et al.   Case # 86206-1

  Watch Oral Argument 

Washington State Supreme Court Synopsis: May a party be a lawful beneficiary under WA's Deed of Trust Act if it never held the promissory note secured by the deed of trust?


State Supreme Court to rule on legality of mortgage recording system

Huelsman maintains that by law in this state, only the actual loan holder, the true beneficiary, can initiate foreclosure, not MERS, as in Bain's case. 

Komo News In order to halt foreclosure and try for loan modification, Huelsman says it was necessary to first contact the actual holder of Bain's loan. The original loan holder, INDYMAC, went bankrupt during the financial crisis. FDIC, which took over the note from INDYMAC, no longer has it. Huelsman says she filed lawsuit, after lawsuit, after lawsuit, only to learn she had not named the actual holder of Bain's loan.

Florida Foreclosure Settlement Update

Orlando Foreclosure Defense “The requirements for providing documentation of loan ownership and good-faith verification to foreclose will undoubtedly make robo-signing more difficult. And in some cases, where the necessary documents and information is missing, it may create an insurmountable problem for the bank to foreclose quickly, or foreclose at all.” 

Elizabeth Warren has asked Congress to stop the secret bailout of AIG, and so should you.

CREDO Action According to recent reports, the Treasury is engaging in a second, secret bailout of the firm -- one that's costing U.S. taxpayers billions, and artificially boosting AIG's profits, leading directly to higher share prices and bigger executive bonuses for some of the same people who ran the company into the ground.

Elizabeth Warren and three other members of the Congressional Oversight Panel for the Troubled Asset Relief Program she chaired -- including two members appointed by Congressional Republicans -- have denounced this stealth bailout of AIG and asked Congress to intervene.


Robosigning Still Going on at Wells Fargo, Reports HUD Inspector General

Wells Fargo, the “good bank”, the one owned partially by St. Warren Buffett, the one whose executives assured the public as well as a room full of Congressional staffers in 2010 that they did not use robosigners. It turns out that not only did they use robosigners, but senior executives knew about it and set policies designed to make sure that documents were signed without verification.

Matt Stoller And when the HUD OIG tried to interview the 14 affidavit signers disclosed by Wells, Wells allowed the IG to interview only 5 of them. Eventually, the bank allowed interviews with all of them, provided that bank attorneys were in the room, as well as private attorneys for each robosigner, who were also paid for by Wells. 

It also turns out that the IG interviewed 33 more robosigners used by Wells that the bank had tried to hide but ultimately had to admit employing.


Bank of America: Too Crooked to Fail

The Obama administration has looked the other way as the bank committed an astonishing variety of crimes – some elaborate and brilliant in their conception, some so crude that they'd be beneath your average street thug. 

Matt Taibbi

Rolling Stone

Bank of America has systematically ripped off almost everyone with whom it has a significant business relationship, cheating investors, insurers, depositors, homeowners, shareholders, pensioners and taxpayers. It brought tens of thousands of Americans to foreclosure court using bogus, "robo-signed" evidence – a type of mass perjury that it helped pioneer. 


Whistleblower facing foreclosure wins $18 million

The False Claims Act allows the government to bring actions against groups that knowingly use false documents to obtain government money or to conceal an obligation to pay money.

CBS News Szymoniak uncovered the "robo-signing" fraud while fighting to save her Florida home from foreclosure. After receiving what she considered to be fake paperwork from her bank, Szymoniak -- a lawyer and fraud investigator -- began investigating tens of thousands of documents in other foreclosure cases that appeared to be falsified.

OCC Probing JPMorgan Card Collections

American Banker JPMorgan took procedural shortcuts and used faulty account records in suing tens of thousands of delinquent credit card borrowers for at least two years, current and former employees say.

The process flaws sparked a regulatory probe by the Office of the Comptroller of the Currency and forced the bank to stop suing delinquent borrowers altogether last year.

13 Reasons Goldman’s Quitting Exec May Have a Point

ProPublica An executive at Goldman Sachs left the firm today with a bang, penning a New York Times op-ed accusing the company of increasingly putting profits ahead of clients. 

Whistleblowers reap millions in U.S. mortgage suits

Reuters Whistleblowers who were instrumental in revealing epidemic mortgage abuses, some of whom risked their careers to do so, are getting multi-million-dollar payouts, court documents show.

Minnesota Appeals Court: Foreclosure By Advertisement Is Void Unless Strict Statutory Compliance Is Met

Ruiz v. 1st Fidelity Loan Servicing

Home Equity Theft Reporter In a recent ruling by the Minnesota Court of Appeals, the court issued a reminder that, for a foreclosure by advertisement to be valid in Minnesota, strict compliance with statutory requirements is met. Accordingly, it reversed a lower court ruling adverse to a foreclosed homeowner.

Schneiderman, banks agree on $25 million MERS deal

The nation's five biggest banks will pay $25 million to the New York attorney general's office to settle certain claims related to the use of Mortgage Electronic Registration Systems.

Housing Wire The banks did not admit or deny any allegations contained in the New York MERS suit, according to court documents. The AG's office reserves claims for consumer damages, but notes that the AG won't seek to vacate any foreclosure judgments.

MERS is not involved in the agreement.


Obstruction of Justice a Feature of Bank Interaction with Foreclosure Fraud Investigators

So DoJ sat on this information for at least a year, preferring to use it to negotiate a settlement than in a criminal inquiry. And this investigation, however limited, showed that the pattern and practice came right from the top, from the executives themselves.

FDL You can’t say that the banks didn’t know what they were doing. They stonewalled and stalled and obstructed federal investigations – even a mild one like this from the HUD IG – and in the end, they got a pretty good deal in the settlement. Crime pays.



Foreclosure-Mill lawyer at CASTLE-STAWIARSKI says 
Bogus Foreclosure Paperwork Led to Illegal Seizures

Gantenbein is expected to appear today before a state House committee taking testimony on a bill designed to end the practice and require banks to provide original loan papers before they can foreclose.

Depspite his testimony, the legislature KILLED the bill.  See below...

Denver Post "The discomfort was you had no way to verify the information they provided, and we found many bank errors, and you're not 100 percent sure you had the right to foreclose," Gantenbein said Monday. "It happened so frequently that there has to be a large percentage of homeowners who lost their homes to the wrong people."

"I just feel the process is tilted unfavorably to the lender and that borrowers are simply being taken advantage of with a system that isn't transparent," said Gantenbein, who estimates he signed as many as 60 qualified-holder statements each day during the more than two years he worked at the Castle law firm.

Colorado house committee kills foreclosure bill

In a near-partisan vote — a single Democrat sided with Republicans — a bill that would have required banks and lenders to prove they have the right to foreclose on someone's home was killed in a legislative committee.


Denver Post BRAINLESS: Since late 2010, virtually everyone in the country has learned that the mortgage industry has been (and still is) using faked documents to take homes they do not own to cover-up its decades of various crimes from origination to securitization. 

To make matters worse, banks and their co-conspirators filed hundreds of thousands of forged documents in court and county records. 

Colorado legislature doesn't see a problem with it.




Bank-Assisted Crime in Progress!


UPDATE : Thursday - 9:30am - EVICTED - EVICTED - EVICTED
This morning we (the 99%) suffered a defeat to the 1% (US Bank/Wells Fargo). Although there’d been a nationwide outpouring of support by emails, phone calls and faxes (thank you) on behalf of Bayless family, the aged Judge - REFUSED – to listen to attorney Bruce Broyle’s motion to quash (eviction) and instead ordered the sheriff to quickly begin the “set-out” process.
Currently, 4 sheriff deputies are at the home, assuring the Bayless family (of 7) are “thrown to the curb" (in the pouring rain) from a place they've called home the past13 years...

OhioFraudclosure Unless it is stopped, this Bank-Assisted Crime will take place tomorrow. 

Click here for attorney Lynn Szymoniak's research that uncovered the evidence involving  the trust and other questionable documents that should have stopped this eviction.

The banks hope to cover up the crimes already committed by evicting the "victims". 

ASK the court to QUASH the WRIT
Delaware, Oh 43015
(740) 833-2519 (Fax)
Judge Whitney's Office - 740-833-2530

...US Bank/Wells Fargo have bought and paid for favorable decisions ("bank-assisted" crime) from this court and long had this out-of-touch aged Judge - Duncan Whitney -"in their pocket" for favorable bank decisions. Please call and fax the court (at below numbers) and let this Judge and Court know…that once has become a crime scene.


Confidence Game – The Film Unraveling Mortgage Fraud

Are Promissory Notes actually Securities before the homeowner signed the mortgage documents? That’s a heavy thought isn’t it?

Also read the Comments.

Deadly Clear As DeadlyClear interviewed Blue Chip Films Producer/Director Nick Verbitsky about his new documentary film Confidence Game based on the demise and collapse of Bear Stearns, there emerged a confirmation to a missing piece of the mortgage-backed securitization process long suspected by foreclosure defense researchers and analysts that may expose a whole new avenue of fraud and even invalidate/void mortgage loan documents.

Fortress Gains in Servicing Market as BofA Retreats: Mortgages

Banks are retreating from the approximately $10 trillion mortgage servicing market, once a cash cow that generated monthly revenue of 0.25 percent to 0.4 percent of loan balances.

Federal and state probes of foreclosure practices led to new regulations that are driving up costs, and a pending change in bank capital requirements also made the business less desirable.

Bloomberg Homeward Residential, which until last month was known as American Home Mortgage Servicing Inc., is another small servicer seeking to grow -- both by purchasing mortgage servicing rights and contracting with the industry’s biggest servicers to handle some of their loans, said owner Wilbur Ross, the billionaire investor who’s chairman of WL Ross & Co. in New York.



“Our office uncovered an abundance of falsified, forged, and fraudulently executed mortgage documents,” said Thigpen. “But our investigation only found the tip of the iceberg. We need the banks to clean up their mess.” 

Guilford County v. Banks, MERS

Guilford County, NC “How can we maintain accurate records of title with fraudulent documents? The banks are also maintaining their own private registry called ‘MERS’ that prevents the public from discovering who owns what loans. Because there is no accountability for MERS, its records are also a mess,” said Thigpen. “The system is broken and it needs to be fixed. We’re telling MERS and the banks: you broke it, you fix it.” 

Maryland gets $1 billion mortgage settlement

The state keeps the right to pursue criminal charges against the banks for loan fraud, Gansler said. He indicated the state was interested in going after lawyers involved in the robo-signings.

Maryland Reporter “The biggest thing we did not give up is securitization claims,” Gansler said. “The banks were packaging sub-prime loans they knew would never be satisfied, and sold them to corporate and individual investors. We will be able to go after those claims in the future.”
3/13/12 Fighting Foreclosure: Where to Start Living Lies The unfortunate reality is that most people show up at an attorney’s office empty-handed a few days before the foreclosure sale is scheduled to take place. DON’T be that person. The attorney is justified in saying she isn’t in a position to help you at that late stage of the sale process.

Man's home foreclosed after heart surgery 

Crowley's foreclosure attorney calls this case extreme and is now fighting to save the condo. "Never communicated with Mr. Crowley regarding making new payments, and they moved immediately into foreclosure," said Johnny Gaspard.

WSVN News Crowley said, when his mortgage got shifted to a different servicer he was told to stop paying to the original bank but never told who to write the checks out to next. "They told me they were going to tell me where they were going to send the new payments," said Crowley, "who the mortgage server was. They never did. It was to a collection agency, not a mortgage server."


Investigation peers into foreclosure problem depths

The report covered only FHA loans, which account for nearly one-third of the market. Still, the fund is in trouble, slipping to the brink of insolvency because of still climbing default levels.

Each servicer either attempted to keep HUD OIG investigators from interviewing those who prepared the affidavits or simply didn't have the ability to provide data requested. In the report, investigators described it as a "hindered review."

Housing Wire Daily volume at BofA often reached as high as 20,000 affidavits, with half being duplicates for bank records. One employee admitted to signing "12- to 18-inch stacks of documents at a time without a review," according to the report.

Notaries were also fast-tracking reams of paperwork. One notary said BofA set a target of completing 75 to 80 documents per hour and often brought up his production in reviews.


Watchdog says banks impeded foreclosure inquiry

Banks hampered an early investigation into whether they were pursuing unlawful foreclosures through shoddy paperwork and lax controls, the inspector general's office at the U.S. Department of Housing and Urban Development said in its report.

Reuters Bank of America for example, provided only excerpts of files, incomplete documents, and conflicting information to government investigators, and refused to provide some of its foreclosure policies.

It also limited employee interviews, and refused to let employees answer certain questions, the report said.

In the Bank of America investigation, the HUD watchdog said it had to enlist the Justice Department's help to issued civil subpoenas in order to secure documents and obtain testimony

Memo to Shaun Donovan: Your Nose is Getting So Long You Need to Get a Hacksaw

The banks are getting a 45% credit for modifying mortgages they don’t own. They will do that all day in preference to modifying their own mortgages, except in those cases where they would have modified them anyhow.

naked capitalism And since the banks are held to a total dollar target, and can use mods of other people’s mortgages to meet this target, they are using other people’s money to pay off their misdeeds. There is no two ways about it.

REPEAT: The banks are getting a 45% credit for modifying mortgages they don’t own. 


JP Morgan Under OCC Investigation for Serious Debt Collection Abuses; Warnings Ignored for Over Two Years

We did not verify a single one” of the affidavits attesting to the amounts Chase was seeking to collect, says Howard Hardin

naked capitalism “This is not an accident anymore,” Almonte now says. “The same people who created this problem at Chase are still in charge. 

They aren’t going to fix it unless they’re forced to.”


Schuette issues second DocX subpoena

Schuette’s criminal investigation is independent of the recently announced multi-state nationwide settlement

Midland Daily News Schuette said any current or former employees of mortgage servicers or processing companies with knowledge of unlawful practices related to mortgage servicing or the execution of documents in Michigan should call the Attorney General’s Corporate Oversight Division at (517) 373-1160.

Private Equity Buying US Foreclosures for Hot Rentals Net 8%: Mortgages

Its title agents must often disentangle foreclosures from second mortgages and liens.

Bloomberg The Obama administration is poised to tap the foreclosure- to-rental approach as officials struggle to turn around the housing market. The president’s push to have mortgage providers make loans more affordable for homeowners has done little to stem foreclosures, says Ginna Green, a spokeswoman for the Center for Responsible Lending



HUD OIG Report


U.S. Department of Housing Ally/GMAC Review

Bank of America Review

Citimortgage Review

JPM Chase, EMC, WAMU Review

Wells Fargo Review


Bank Officials Cited in Churn of Foreclosures

The report concludes that managers were aware of the problems and did nothing to correct them. The shortcuts were directed by managers in some cases, according to the report, which is by the inspector general of the Department of Housing and Urban Development.

NY Times Managers at major banks ignored widespread errors in the foreclosure process, in some cases instructing employees to adopt make-believe titles and speed documents through the system despite internal objections, according to a wide-ranging review by federal investigators.

Bank Officials Cited in Churn of Foreclosures

Bank of America employees testified that they had raised concerns about whether documents were being properly notarized, but managers told them to proceed. One vice president said documents in her department were checked only for “formatting and spelling errors,” not the underlying figures or facts in the case.

NY Times “I believe the reports we just released will leave the reader asking one question — how could so many people have participated in this misconduct?” David Montoya, the inspector general of the housing department, said in a statement. 

“The answer — 

             simple greed.”


Is MF Global Getting a Free Pass?

These executives committed a crime. Virtually every knowing violation of the Commodities Exchange Act is a crime, but taking money from segregated customer accounts is at the top of the list. 

MF Global executives took money from segregated customer accounts — money that belonged not to MF Global but to the farmers and commodities traders that were its clients — and used it to prop up its rapidly collapsing business. Nor was this petty cash: of the $6.9 billion in customer assets that MF Global held, a stunning $1.6 billion is missing. There is virtually no chance that the full amount will ever be recovered.

Joe Nocera

NY Times

I understand that bringing complex financial cases in front of a jury is not easy. But what prosecutors don’t seem to understand is that the country needs them to bring these cases. When they took a pass on Angelo Mozilo, the former chairman and chief executive of Countrywide, and Richard Fuld, who was chief executive of Lehman Brothers when it went bankrupt, they sent a signal that the highly paid executives who gave us the financial crisis would not be held to account.

A failure to prosecute anyone at MF Global would be, if anything, even worse. It would mean that executives at a broker-dealer can indeed steal customer money and get away with it — so long as it was “unintentional.”


Banks, Meet the New Foreclosure Monitor

Mr. Smith also plans to publicly call out banks if they break the terms of the foreclosure settlement.

WSJ In the settlement documents filed Monday, the government charged the banks with eight counts of violating federal and state foreclosure and lending laws. The charges are the most detailed allegations to date that banks failed to follow the law when foreclosing on homeowners.


Bank of America, MERS Ask Court to Dismiss Texas Counties’ Mortgage Suit

The Texas Legislature approved of MERS’s appearance as a mortgagee in filings in county land records, the defendants said in a filing March 9 in federal court in Dallas.

Bloomberg Harris County disagrees with the contention that MERS has statutory permission to operate as it has, John Odam, a county assistant district attorney, said in an interview today.
“We analyzed the legal basis for our claim and feel we have a good claim,” he said.

Foreclosure Fraud Settlement Docs Finally Released

Wow. In other words, servicers can force borrowers to sign away their due process rights for accepting principal reductions associated with the settlement.

Dsvid Dayen


As expected, the monitoring elements of the settlement include a quarterly self-report by the banks, after which an independent monitor can scrutinize the reports. So the banks are essentially policing themselves here, while the monitor has to wait several months to review their work and see if they are not according themselves properly. This is an invitation to abuse.

National foreclosure settlement filed in federal court, Madigan urges Illinois borrowers to seek help

Attorney General Lisa Madigan today urged distressed borrowers to call on her office to help determine if they are eligible for relief under the $25 billion national foreclosure settlement with the nation’s five largest bank mortgage servicers, which was filed this morning in federal court.

Aledo Times “I can’t stress enough how important it is to make the call for help,” Madigan said. “Whether you are eligible under this settlement or another assistance program, we want to connect you with the free, legitimate resources available for distressed borrowers.”



$25 Billion Mortgage Servicing Agreement Filed in Federal Court

The Settlement Complaint

Ally Consent Judgment
Bank of America Consent Judgment 
Citigroup Consent Judgment 
J.P. Morgan Chase Consent Judgment 
Wells Fargo Consent Judgment 

Department of Justice The Justice Department, the Department of Housing and Urban Development (HUD) and 49 state attorneys general announced today the filing of their landmark $25 billion agreement with the nation’s five largest mortgage servicers to address mortgage loan servicing and foreclosure abuses. 

Complaints mount against Palm Beach County foreclosure rescue company accused of defrauding desperate homeowners

Palm Beach Post Clients allege in complaints to the Florida Attorney General's Office and court actions in Broward and Palm Beach counties that instead of getting the help they sought, they unwittingly signed over the deeds to their homes.

Some claim they were then threatened with eviction and left with mortgage debt on properties to which they no longer have title.

Homeowners battle banks to stop foreclosures ... and win

“There are more (homeowner) claims because lenders operated in flagrant disregard of the law,” said Diana Thompson, a veteran consumer attorney with the National Consumer Law Center. “You only have a claim against the lender if the lender didn't do what they were supposed to do.

MSNBC Consumer attorneys also are attacking lenders’ effort to paper over missing links in the chain of documents required to prove that a bank owns a loan and has the right to foreclose. Some of those defective paper trails date to the sloppy underwriting that accompanied the frenzy of mortgage lending in the 2000s, when hundreds of now-defunct lenders churned out a blizzard of notes that were instantly offloaded to investors.

From Last Year


Jury Awards GI $20M in

Mortgage Case

Military news Jurors in the case of David Brash v. PHH Mortgage Corp., doing business as Coldwell Banker, deliberated for about six hours before ruling in Brash's favor. During the six-day trial, jurors heard that Coldwell Banker improperly reported Brash, 29, to credit bureaus which led to a "serious delinquency" on his credit report, that it refused to answer his questions or correct his account and damaged him emotionally, physically and financially, his attorneys and court documents say.

State Targeting Attorneys Accused in Mortgage Fraud Cases

NC Times The state attorney general's office, working with other law enforcement and the State Bar, ratcheted up its mortgage fraud crackdown with the arrest of the owners and managing attorney of a Northern California law firm accused of scamming residents seeking loan help.

Decided on March 9

Homeowner Loses Appeal for Failure to Sufficiently Plead  

"If the notice of acceleration was
the focus of Appellant's defense, he could have, and should have, framed his pleading to focus on that particular notice. Had he done so, Appellee could have focused its application for summary judgment on the acceleration notice."

Dissenting: The good news for plaintiffs, especially mortgage foreclosure plaintiffs, is that the seemingly insurmountable difficulties of actual compliance with the summary judgment rule can now be avoided by the simple expedient of attacking the "specificity" and "particularity" of the defendant's response to their assertion that all conditions precedent were met.


Fifth District COA

Dissenting opinion: The majority has construed the rule requirement too narrowly and has turned the rules of procedure on their head by excusing Countrywide's lack of compliance with the summary judgment rule on this basis.

The lesson of this case for defendants is that the Fifth District Court of Appeal demands strict compliance with rule 1.210(c) and considers any violation to be
fundamental. Extremely close attention should be given to the "specificity" and "particularity" requirements. As this case illustrates, non-compliance with the rule need
not be raised below in order to succeed on appeal, so there will be no second chance to get this critical point of pleading right. Apparently, if Godshalk had simply added three
words he would not have lost this appeal.


Paige Kinney, Former Countrywide Loan Officer, Sentenced To 15 Years In Prison For Mortgage Fraud

FBI "Mortgage fraud has had a tremendous adverse impact on both the economy and the citizens of Arizona," said James Turgal, special agent in charge of the FBI's Phoenix office, in a statement. "It will continue to remain a top criminal priority of the FBI."

The Legal Lie at the Heart of the $8.5 Billion Bank of America and Federal/State Mortgage Settlements

This deal is like stealing your neighbor’s gold watch and using it to resolve charges of embezzlement.

The pre-existing, and likely larger group of investors (I am told it included Fannie, which is one of the biggest investors in MBS) had concluded an investigation and found breaches in every single Countrywide securitization (Bill Frey had developed proof of Countrywide modifying loans where Bank of America owned a second lien behind that first and had not wiped it out first, as would be required).

naked capitalism The terms of Countrywide PSAs vary, but all appear to restrict mods. The prohibitions varied by credit quality of the deal. Alt-A and early vintage (2004 and earlier) deals often barred mods completely; subprime and later vintage deals generally allowed for a higher limit on mods, with 5% the top amount across these deals. The idea was that some mods were expected in the dreckier mortgage pools. Nevertheless, all of them, as well as the few that had no caps, also required Bank of America to buy the modified loans back at par. 


6 Ways to Get Ready for the May 1st GENERAL STRIKE 

occupywallst On May 1st, Occupy Wall Street has called for a General Strike. We are calling on everyone who supports the cause of economic justice and true democracy to take part: No Work, No School, No Housework, No Shopping, No Banking - and most importantly, TAKE THE STREETS!

Whistleblower Lawsuits Against Banks Extinguished in Foreclosure Fraud Settlement

I think my disgust over federal housing policy is just about complete. 

David Dayen


Michael Hiltzik rounded up some of the more troubling issues. He mentions that OCC penalties will get folded into the settlement, basically charging $0 for their violations. The Federal Reserve did the same thing. He mentions the Ted Gayer study showing that only 500,000 borrowers will even be eligible for the principal reduction in the settlement, half of what HUD and other regulators promised.


Higher Fees? Let’s Celebrate

One of the great things about American capitalism is that greedy and inefficient companies usually lose out.

As deposits leave the big banks for smaller competitors, the too-big-to-fail crew will inevitably lose political clout — and, eventually, start shrinking.

NY Times Smaller banks and credit unions are a better fit for the average consumer. They don’t have the huge branch networks to support, they pay their executives much less and they don’t generally feel the need to be enormously profitable in the first place.

There’s finally hope that Americans are beginning to do the right thing by moving their money to smaller and friendlier institutions.


Hits, and Misses, in a War on Bribery

“This is not the time for the United States to be condoning corruption,” Mr. Breuer said. “We are a world leader and we want to do everything to make sure that business is less corrupt, not more.”

NY Times In the last four years, a total of 58 companies have paid a combined $3.74 billion to settle such corruption charges. Since 2009, some 67 people have been charged, 20 are still awaiting trial or are at large, and 42 have been convicted, some from charges prior to 2009. 

Don’t you dare foreclose on my 91-year-old mother

When Tanya Dennis successfully reclaimed her home last year, her battle with Wells Fargo was only half over.

SF Bayview Tanya made headlines last year, when she hired a locksmith to break back into her own home of 27 years after sheriff’s deputies had evicted her. She became such a thorn in the side of Wells Fargo, the nation’s largest mortgage originator – not only suing them without a lawyer, but also disrupting their shareholders’ meeting and getting arrested, recruiting elected officials’ assistance and protesting with ACCE (Alliance of Californians for Community Empowerment) – that the bank reduced her mortgage principal by over $100,000, substantially reducing her monthly payments.

Unemployed? Now’s The Time To File Bankruptcy

Bankruptcy Law Network Now, when you have no income and no job prospects appears to be the “right” time to file. That perversity is the result of the means test, which gages your ability to repay your debts in the future by looking at your income for the past six months.



Latest Borrower Trap? Trial Mod Offers With No Permanent Mod Terms

Despite the fact that the Treasury-sponsored mortgage modification program known as HAMP has been roundly decried as a disaster, it lumbers on and seems simply to change rather than improve.

naked capitalism Not only were too few mods done but banks also lied about program features, including that many borrowers were assured foreclosure efforts were not moving ahead when they were, with the result that quite a few program participants wound up losing their homes.


Churches Send Repentance Message to Banks

“There’s still not enough churches that understand the plight of their people — that if one family loses their home, it’s like all of us go down.”

“During this season, when we individually are examining our lives, we think it’s appropriate for the institutions that affect us to examine theirs.”

“Our banks have done a great deal of damage in a very public way. So it seems appropriate as we enter into a season of penitence that we invite those who separated themselves from the community to repent with us. It’s basically Ethics 101.”

NY Times He is withdrawing the church’s money, several hundred thousand dollars, from its account with the Bank of America. By the April weekend when Christians mourn Jesus’ crucifixion and celebrate his resurrection, Mr. Bell said, he will have moved the assets to a local bank as a protest against Bank of America’s role in mass foreclosures and to issue a call for its repentance.

Congregations have withdrawn $16 million, and their individual members and organizational partners an additional $15 million, from banks deeply implicated in the foreclosure crisis — primarily Bank of America, Wells Fargo and JPMorgan Chase.


Anecdotes of Mortgage Fraud

Most of it, today, is to cover up the chain of fraud that dates back to the early 2000s. It has been all fraud, all the time, since 2000.

Prof. Randall Wray As you peel back every layer you find fraud. From the appraiser to the broker, from the lender to the securitizer, from the recording of the mortgage sales to the securitization’s trustees, from the accounting firms that signed off on everything to the ratings agencies that rated everything AAA, from the investment banks that created CDOs to the hedge fund managers who bet against the synthetics Goldman sold to its own customers, and from the bank lawyers to the judges that help banks steal homes. The whole damned onion is fraud.

HAMP for investors: A bailout, or a necessary evil?

Is it really fair to give irresponsible investors a bailout? Would it not be more reasonable to use this money to help underwater homeowners who actually intended to live in their homes and not take advantage of the market?

Housing Wire The Obama administration will extend mortgage assistance to investors for the first time. While this will help some who bought homes to use as rental properties, perhaps for extra income or to boost their retirement, it will also help speculators who pushed prices through the roof and made the housing bubble bloat.

Why Brooklyn Foreclosure Numbers Could Get Worse

This year the borough faces an additional problem: more homeowners could lose their homes to foreclosure if the state budget does not include funding to provide them with legal advocacy.

“You’re going to see the same mortgage brokers that got them into this mess, resurface as mortgage modification specialists.”

The Brooklyn Ink In Brooklyn more than 20 non-profits that provide foreclosure education, counseling, and legal representation are at risk of losing their funding. They are part of the statewide Subprime Foreclosure Prevention Services Program, a network of nonprofits that started in 2008 with $25 million from the state budget.

 The money runs out in April.


AG settlement clears BofA from Whistleblower HAMP lawsuit

The multistate AG settlement scheduled to be filed Friday released BofA of any liability under the Mackler suit.

Housing Wire More releases are expected under the AG settlement filing for all five servicers.

Foreclosure looms for Lebanon Township homeowner, while the banker has admitted fraud

Boyer’s nightmare started when she mistakenly missed the deadline to pay her property taxes. Previously the taxes were paid through the mortgage company, she said. On March 15 a Musconetcong River Road resident and her daughter could be forced out of their home unless the courts grant a stay of foreclosure.

Meanwhile the banker that is foreclosing on the home is headed to prison for rigging the process in his favor.


New whistleblower cases allege continued bank fraud

Whistleblower lawsuits made public in recent weeks shed new light on abuses in the mortgage industry that led to — and continued well after — the housing crash in 2007.

iWatch News The cases suggest that fraud inside the banking industry continued years after the meltdown, some as late as 2011. They have been made public as federal officials put the finishing touches on the $25 billion mortgage fraud settlement with five major lenders.

The motto of the credit boom seems to have been “Trust. It would cost too much and take too long to verify.”

An Industry’s Failure to Verify, After Trusting

More than three years later, it appears that one of those cases will go to trial in May in New York Supreme Court in Manhattan. If it does, it will be the first major civil case from the financial crisis to go to trial

NY Times Many cases charging misbehavior have been settled, often with payments of billions of dollars, but there has been no public presentation of evidence and cross examination of witnesses before a judge.

This trial, and ones that could follow it, will not change how much money has been and will be lost because of bad loans made during the boom. But the trials are likely to affect the division of the losses. For those who watch them, they will also document just how irresponsible — or worse — many of the players were.

Gov. launches homeowner assistance forum (this is the entire article)

LAS VEGAS (WTW) — Nevada Gov. Brian Sandoval will launch a two-day forum in Las Vegas designed to provide assistance to homeowners facing foreclosure.

The "Home Means Nevada" event takes place Friday and Saturday at the Cashman Center. Help will be available both days from 9 a.m. to 7 p.m.

Wisconsin Rapids


Sandoval will be joined Friday by state Department of Business and Industry Director Terry Johnson.

Officials say bank and federal assistance fund representatives will be on site to qualify homeowners for mortgage assistance.

Attorneys will be available to provide free legal aid and regulators will be on hand to take mortgage fraud complaints.

Faulty Foreclosures Present Systematic Breakdown and Big Risks for Buyers

The bottom line is why should a perfect stranger be allowed to take your property and then be allowed to claim that they were somehow allowed to use fabricated documents containing false and fraudulent declarations of fact, forgeries, and misrepresentation of authority?

Neil Garfield 

Living Lies

Nobody is saying yet that 80% of the foreclosures were so wrong that the property title should revert to the foreclosed homeowner and that those who thought they had title arising out of the foreclosure or from a bank or REO company (another layer controlled by the banks) are in for a rude awakening. Sorting out these title problems will be a virtual industry in coming years as homeowners, illegally foreclosed and evicted from their homes start making claims in larger numbers for return of title and possession. There are many who have already done so and been awarded both title and possession. 

Bank of America's Moynihan Can’t Get Through Presentation Without Shirtless Hecklers

WSJ The first protester waited about five minutes into Moynihan’s speech to begin yelling “Bust up Bank of America before it busts up America.” 

Bank of America Reaches Deal on Housing

NY Times The cuts for homeowners who owe more than their homes are worth could total more than $100,000 each under the deal with the government, according to Dan Frahm, a spokesman for Bank of America. Bank of America hopes it will be able to reduce what it owes in penalties under the settlement by up to $850 million.

Court reinstates suit by Chicago homeowner against Wells Fargo

A Chicago homeowner who was denied participation in a federal mortgage modification program can sue her lender for fraud and other claims, a federal appellate court said this week.

Wigid v. Wells Fargo

Chicago Tribune

Case source: Home Equity Theft Reporter

U.S. District Judge Blanche Manning threw out her complaint last year, ruling that Wigod's claims were barred by federal law. 

The 7th Circuit U.S. Court of Appeals, in an opinion released Wednesday, overturned Manning's decision and revived most of Wigod's suit. The ruling is likely to send shivers through the banking industry, which up until now has largely been shielded from HAMP-related lawsuits.


The Pernicious “Foreclosures are Good” Meme

A foreclosure drops property values, increases state and local government costs in the case of blight, and wrecks entire communities.

FDL One foreclosure causes $250,000 of damage to the larger economy. And a good deal of them are unnecessary, and could be avoided simply with the time-honored process of renegotiating contracts in a way that works financially for the borrower and lender.

Banks foreclosing on US churches in record numbers

Reuters The surge in church foreclosures represents a new wave of distressed property seizures triggered by the 2008 financial crash, analysts say, with many banks no longer willing to grant struggling religious organizations forbearance.

Faulty Foreclosures Present
Systematic Breakdown and Big Risks for Buyers

The bottom line is why should a perfect stranger be allowed to take your property and then be allowed to claim that they were somehow allowed to use fabricated documents containing false and fraudulent declarations of fact, forgeries, and misrepresentation of authority?

Neil Garfield

Living Lies

Nobody is saying  [yet]  that 80% of the foreclosures were so wrong that the property title should revert to the foreclosed homeowner and that those who thought they had title arising out of the foreclosure or from a bank or REO company (another layer controlled by the banks) are in for a rude awakening. Sorting out these title problems will be a virtual industry in coming years as homeowners, illegally foreclosed and evicted from their homes start making claims in larger numbers for return of title and possession. There are many who have already done so and been awarded both title and possession. 

Whistleblower Claims Bank Of America Intentionally Blocked Homeowners From Getting Federal Mortgage Help

The bank and its agents routinely pretended to have lost homeowners’ documents, failed to credit payments during trial modifications and intentionally misled homeowners about their eligibility for the program, the complaint alleged.

Think Progress Bank of America has been one of the worst banks for getting homeowners through the HAMP program. This has mostly been blamed on the bank’s incompetence, but a whistleblower suit in Colorado alleges that Bank of America was intentionally steering customers away from HAMP.


Go Harris Go!

California AG Harris Takes Down Three in Sacramento Area Loan Mod Scam

"Homeowners facing foreclosure are being targeted by predators, including those who use their law license to gain credibility and scam innocent Californians," Attorney General Harris said

National Mortgage Professionals In one example of the firm's deceptive practices, a victim who sought to lower his mortgage payments was told by Gregory Flahive to reject his lender's offer of modification. The homeowner was told the Flahive Law Corporation could secure a better interest rate, reduce his principal, and possibly get his second mortgage eliminated. Four months later, the victim lost his home to foreclosure.

Lowering our expectations for foreclosure settlement

Chicago Tribune The shortcomings of the $25-billion deal with five major banks seem to proliferate with each passing day.

‘Forced’ Home Insurance Policies Face New Scrutiny

WSJ However, officials at the state and federal level have been concerned that insurers have been charging too much for something known as “force-placed insurance,” which takes the place of a lapsed policy.

This week, a new U.S. consumer watchdog and mortgage giant Fannie Mae have been promising a crackdown on those homeowners insurance policies.

Calif. leads nation in suspicious home loans

California has consistently ranked near the top among states with suspected mortgage fraud since 2002, the year the Treasury Department began reporting suspicious activity statistics, federal reports show.

California Watch "We are looking at a situation of up to $640 billion in wealth having been lost because of this wave of foreclosures that has hit the state," Harris said, referring to the decline in homeowner equity. "There is a direct connection" between mortgage fraud "and the issue that we are challenged with in terms of our state budget crisis."


Whistleblower says Bank of America defrauded HAMP

"In other words, BoA has had it both ways. BoA has continued to maximize the value of its mortgage portfolio with anti-HAMP modification practices and managed to make money by committing fraud on homeowner," the lawsuit said.

Reuters Bank of America NA prevented homeowners from receiving mortgage-loan modifications under a federal program in order to avoid millions of dollars in losses while benefitting from financial incentives for participating in the program, according to a complaint unsealed in federal court Wednesday.

The unsealed Complaint


Government report on Freddie Mac filled with redactions

A simmering debate on Capitol Hill over how to help more than six million Americans struggling to save their home from foreclosure took a strange twist Wednesday.


MSNBC The inspector general's report concluded that Freddie Mac alone could save taxpayers “significant” sums of money if it pressed the companies servicing its mortgages to modify more loans.
How much money could taxpayers save? That we don’t know because the OIG redacted the amounts.

Financial Guaranty jumps into legal battle over insured mortgage bonds

Housing Wire FGIC claims Ally, formerly GMAC, and affiliated parties obtained insurance on more than $1.14 billion in residential mortgage-backed securities by making material misrepresentations and omissions about loans backing the bonds. 

“Examining Lending Discrimination Practices and Foreclosure Abuses”

The FBI and the Justice Department have fallen for one of the greatest acts of misdirection by accepting the Mortgage Banker Associations definition of “mortgage fraud” – a definition that defines accounting control fraud out of
existence. (The courts have implicitly defined accounting control fraud out existence in the context of civil suits for securities fraud. Think of how insane that is. The form of fraud that economists and criminologists have shown to be the leading cause of catastrophic financial losses purportedly does not exist because judges think such frauds would be “irrational.”

Professor Bill Black The elite financial frauds are treating the United States of America’s criminal justice system and financial markets with utter contempt. They believe they can become wealthy – with impunity – through frauds that cost U.S. households $11 trillion dollars and cost seven million Americans their jobs. Not a single elite fraudster who was instrumental in making the millions of fraudulent loans that drove the crisis has even been indicted – over seven years after the FBI’s September 2004 warnings that there was an “epidemic” of mortgage fraud that would cause a financial “crisis” if it were not stopped. Here is how bad the situation has become.

FHFA, Freddie faulted for overlooking mortgage servicers

Housing Wire Freddie Mac and its conservator the Federal Housing Finance Agency avoided implementing stronger oversight of mortgage servicers when they had the chance, according to an FHFA Office of Inspector General report.

Virginians protest General Electric over foreclosures

Protesters demand GE take responsibility for helping homeowners who received subprime loans from the company's now-closed mortgage arm, WMC Mortgage Corp.

iWatch News WMC, was the subject of a Center for Public Integrity investigation, which found that after GE bought WMC in 2004 it continued to ignore complaints from compliance officers about suspicious loans supported by inflated incomes and falsified documents. After having pumped out roughly $110 billion in high-cost loans, the company’s finances began faltering and GE shuttered the unit in 2007.

The FBI is now investigating WMC.


Houston’s County Joins Texas Suit Seeking $10 Billion From MERS, Banks

Bloomberg Harris County Texas, which includes the city of Houston, won a bid to join a group lawsuit seeking damages from the Mortgage Electronic Registration Systems Inc., Bank of America Corp. and Stewart Title Co.

OCC Servicer Review Firm Also “Scrubs” Loan Files, Fabricates Documents

SolomonEdwards apparently did and continues to do a lot of FDIC-related work, and my understanding is that a lot of procedures were developed to deal with the to transfer mortgages out of banks that had failed. Those are perfectly kosher with a non-securitized loan but you just can’t do that in a PSA context. For instance, many of these actions are tantamount to trying to transfer a defaulted loan into a REMIC trust. Not only is that a void act under New York trust law (it was never contemplated, hence the trust can’t do that) but also under REMIC, a trust cannot accept a non-performing asset (which is exactly what a dud loan is).

naked capitalism It was disconcerting to speak to someone who obviously thinks his firm is highly professional engaged in activities that include document fabrication, which is what creating allonges now amounts to.  And the worse is, I have no doubt SolomonEdwards is more careful than most firms in the industry. This confirms, as we have said repeatedly, that there was a massive failure in the industry to conform to the requirement of the legal agreements that it devised. 

And there is a very big business, now with a government seal of approval, in covering up that fact.


Mortgage Fraudsters may not fare too well in prison...

Jury Convicts Stanford in $7 Billion Ponzi Fraud

It took three years to bring Mr. Stanford to trial because he was severely beaten in a 2010 brawl with another federal inmate in a prison outside Houston and then became addicted to prescription anti-stress drugs. 

NY Times A federal jury on Tuesday convicted R. Allen Stanford, a Texas financier, on 13 out of 14 counts of fraud in connection with a worldwide fraud that lasted more than two decades and involved more than $7 billion in investments.

Anyone who wanted to know the truth about the Stanford enterprises had only to “follow the money, just follow the money.”


Homeowner Rejected for Free Loan Modification Wins $250,000 Principal Reduction After Hiring CPAC (DE) to Sue for Bank Fraud and Lender Abuse

MarketWatch Several times, Ocwen's free Loan Modification resulted in him making temporary trial payments with an empty promise for a Loan Modification that never materialized, yet Carlos never received an explanation as to what happened to all those payments he made in good faith.

Conspirator in Mortgage Rescue Fraud Scam Sentenced

Mortgage Servicing News A mortgage rescue scheme conspirator has been sentenced to five years in prison for his role in a scam that affected at least 1,800 distressed homeowners in Phoenix.

While the big players that defrauded 100s of 1,000s aren't even on law enforcement's radar.


Former Iceland Leader Tried Over Financial Crisis of 2008

Iceland opened a criminal trial on Monday against its former prime minister, Geir H. Haarde, becoming the first country to prosecute one of its leaders over the financial crisis of 2008.

NY Times Mr. Haarde is charged, in effect, with doing too little to protect the country against the depredations of its bankers as they pursued wildly expansionary lending that resulted in financial disaster for the country. He was indicted in 2010 by a sharply divided Parliament, charged with violating the laws of ministerial responsibility.

This is beginning to sound like a broken record. This time from Wisconsin...

Bank practices cause register of deeds offices to be flooded with fraudulent documents

(And how many arrests were made today?)

Wisconsin State Journal "It's troubling to know that in each of our offices, are thousands — and I mean thousands — of fraudulent documents."

"Not only did 'Linda Green' not sign it," County Register Williquette Lindsay said, "but somebody fraudulently notarized it."


"We have 13 million people having post traumatic stress disorder. When they wake up out of their mesmerizing experience and snap?... I would be very frightened.

The Great Swindle:

How to Stomach Knowing the Banks Are Stealing a Nation's Worth of Homes, One Home at a Time

Everybody is helping them, no one is helping us. Judges help them, attorneys help them, government helps them.

Huff Post "I did not lose my home, they stole it from me," explains Bertha Herrera, 63-year-old chaplain from Van Nuys, Calif. Bertha was evicted from her home of 32 years at gunpoint by LA County Sheriffs.

While many are still content to blame their neighbors for "buying too much house," many more are peeling back the curtain to see what has really happened to their neighbors.

You can start to see the whole picture by taking in one story at a time. Here's Bertha's story:


Occupy Cleveland march, rally this morning against foreclosure

The marchers went to the Justice Center to disrupt a sheriff's sale. "With the Republican presidential primary coming up, the one thing the candidates don't seem to be talking about is foreclosures," she said.

The rally "will put the focus back where it belongs, on the people of this community."


Servicers Behaving Badly: An Insider’s Perspective on the Root Cause of this Recurring Problem

Subprime Shakeout The solution was reasonably simple: the management team was awarded above-market base salaries, together with incentive compensation which paid them attractive bonuses if they could increase MH Servicer I’s residual value. If the residual value went up each year, they stood to make a lot of money.


Agents advised by WELLS FARGO to keep 'bank-owned' quiet

The goal: To get buyers to take a look at a home without first concluding there must be something wrong with it.

Palm Beach Post If a buyer wishes to put a contract on a bank-owned home, then it will become clear through paperwork the property is a foreclosure, and any defects or repairs can be corrected or reflected in the sales price, Smith said.

(The clouded unmarketable title will remain a secret. MSF)


The Little We Know About Foreclosure Reviews Is Troubling

Check out the additional bizarre foreclosure stories

American Banker The good news: regulators are pulling back the curtain on the consultants that the big mortgage servicers hired, under orders from the agencies, to review their foreclosure processes.

The bad news: what's been revealed isn't pretty.


Foreclosed homeowners challenge banks to prove they still hold their notes.

Wisconsin State Journal Increasingly, courts are taking the homeowners' side. At least five times since 2010, Wisconsin Court of Appeals panels have upheld challenges by debtors demanding to see the legal paperwork tracking their loans, and lenders were unable to do it.

Lenders Change Strategy, Now Helping Distressed Owners


Lenders increasingly allow the foreclosed to stay
No payment, no problem as time and money required to evict owners increases

NY Times



Some lenders are now willing to make deals with owners to let them stay after defaulting, offering to pay home insurance, for example, while the resident pays for utilities.

Other lenders simply look the other way, quietly putting off foreclosure sale dates, knowing that the costs of the ordeal probably exceed the diminishing value of the properties.


A Hidden Fee Is Set to Rise

The G-fee — as it is known — does not show up in borrowers’ mortgage documents or good-faith estimates, and it is little known outside the industry.

“It gets incorporated into the underlying rate that the borrower pays.” 

NY Times An interest rate is usually made up of three parts: the largest goes to the bank or the investors who buy the loan; a smaller portion is for the mortgage servicer that collects monthly payments; and then there’s the guarantee fee. Fannie and Freddie charge guarantee fees as a form of insurance against default for the loans they acquire and resell to investors

When Are Countrywide Notes Endorsed? A Filing in A Federal Case Shows the Problems With Negotiability.


Matt Weidner, Esq Public Employee Retirement System of Mississippi lawsuit. It is alleged that Goldman Sachs misrepresented the quality of hundreds of millions of dollars in loans that were sold to these retirees. Goldman said they were solid gold, it turns out they were garbage. Mississippi said they were defrauded, Goldman says you shouldn’t expect our marketing, sales and investment material to be truthful, too bad your retirees lost their pension checks, screw you, we’re Goldman.

Low Rates For Savers Are Reason For Complaint

Gretchen Morgenson

NY Times

The issue — as anyone looking for income-producing investments knows — is that the Fed drove down interest rates to almost zero to shore up big banks and an economy that those banks helped drive off a cliff. Now savers, who did nothing to create the financial crisis, are being punished.

When Living in Limbo Avoids Living on the Street

Forced by the harsh realities of the real estate market, lenders are increasingly likely to allow defaulting owners to remain in their homes — a change in attitude and strategy that is helping to buoy some neighborhoods while further slowing the nation’s foreclosure process.

NY Times Some lenders are now willing to make deals with owners to let them stay after defaulting, offering to pay home insurance, for example, while the resident pays for utilities. Other lenders simply look the other way, quietly putting off foreclosure sale dates, knowing that the costs of the ordeal probably exceed the diminishing value of the properties.

Companies Foreclose; Blight Follows

With the housing bust and continued recession, Fannie Mae, and its counterpart Freddie Mac, have quietly become major residential landowners in the Bay Area’s hardest-hit neighborhoods.

The Bay Citizen The property carried $382,000 in debt when it was foreclosed on last year. It is currently for sale for $76,000, but Mr. Chandra believes even that is too high.

“It makes me angry because if they lowered the price, I would buy it and take care of it,” Mr. Chandra said. “As it is, it just sits there.”

Foreclosures: Stories behind the numbers

The housing collapse has been "horrible" for animals, said Jolene Hoffman, shelter director with the Humane Society of Ventura County.

vcstar From Lunn's vantage point at the hub of local foreclosure activity, documents stream through at a steady pace and he tries not to lose sight of what they represent — likely the death of a family's biggest lifetime investment.

"How excited they were to have the American dream," he says, trying to imagine the day the family was handed the keys to the home. "And now their life has been turned around. These are devastating things."

Robosigning focuses attention on title companies

Home Equity Theft Reporter "If there is not a clear chain of title in the foreclosure process, how can there be a clear chain of title for the person buying foreclosed property?" said San Francisco Assessor Recorder Phil Ting, who commissioned the audit. "Given our report, it calls into question whether entities selling a foreclosure really have the right to transfer that property to somebody else."

Press Release

Judge Orders Brookstreet CEO to Pay $10 Million Penalty in SEC Case The Securities and Exchange Commission today announced that a federal judge has ordered the former CEO of Brookstreet Securities Corp. to pay a maximum $10 million penalty in a securities fraud case related to the financial crisis.

Man Fined For Not Cutting Grass Of His Foreclosed Home 

Huff Post Although it's possible Englett isn't responsible for the infractions, don't be surprised the city of Arlington is giving it a try. "You have to remember cities are all about grabbing money from you," CBS 11's legal advisor Jerry Loftin said . "They try anyway they can."

Massachusetts Appeals Court Rules That Lost Promissory Note Renders Mortgage Unenforceable

JPMorgan Chase v, Casarano

A mortgage without sufficient evidence of a promissory note could be rendered unenforceable and un-forecloseable.

Massachusetts Real Estate Blog In a decision which could impact foreclosure cases involving missing or lost loan documents, the Appeals Court held that a mortgage is unenforceable and must be discharged where the underlying promissory note securing the mortgage could not be found.

BofA Clash With Fannie Intensifies as Insurers Reject Loans

Bloomberg  Bank of America Corp. said it’s facing more demands by Fannie Mae for refunds on flawed home loans because mortgage insurers who cover defaults rejected 25 percent more claims last year.



Fed Shrugged Off Warnings, Let Banks Pay Shareholders Billions

ProPublica In late 2010, a major regulator warned the Federal Reserve: Banks are not healthy enough to increase dividends, and the economy could implode again. But in its biggest decision since the financial crisis, the Fed overrode that advice and let banks return more than $30 billion to shareholders. Here's the inside story.

HAMP: Obama Administration Lets Banks Out Of Doghouse For Bad Mortgage Servicing

... not because of vastly improved servicing, but rather as a result of the $25 billion foreclosure fraud settlement struck last month. "As part of the mortgage servicing settlement, Treasury has agreed to release withheld incentives for past deficiencies," 

Huff Post "It's just the latest in an unending series of Treasury capitulations to the banks," said Neil Barofsky, the former Special Inspector General for the Wall Street bailout, $30 billion from which was used to create HAMP.  "The servicers' willful disregard of HAMP's rules will now officially go unpunished as Treasury converts what was always nothing more than a slap on the wrist to complete absolution."


North Miami Mayor Andre Pierre hit with home foreclosure

When asked why he wasn’t paying his mortgage, Pierre said that the house is underwater.

South Florida Business Journal North Miami Mayor Andre Pierre was hit with a foreclosure lawsuit over his house, which the mayor says he was negotiating a mortgage modification for.

“I’m not sure it’s legal for them to file it when we have been talking back and forth,” he said. “The left hand doesn’t know what the right hand is doing.”


Assembly's plan for mortgage-deal funds riles housing advocates

Richmond-Times Dispatch The General Assembly does not plan to use that money to help homeowners facing foreclosures or struggling with mortgage payments, and that has housing advocates in an uproar.


New York continues assault on MERS

Lexology New York government officials are continuing their assault against foreclosure actions where Mortgage Electronic Registration Systems, Inc. (“MERS”) was the assignee of the mortgage, and challenges to foreclosures involving MERS are increasingly gaining traction in New York courts. 


Federal court ruling against MERS foreclosure in Oregon comes (again) as Republican lawmakers try to validate it

A federal judge has yet again issued a ruling that effectively questions the validity of scores of foreclosures in Oregon, a crisis the Legislature could resolve in the mortgage industry's favor this week if bank lobbyists and House Republican leaders have their way.

Opinion and Order in James v. ReconTrust, BAC, Northwest Mortgage and MERS

Oregon Live In an opinion issued Wednesday, U.S. District Court Judge Michael Simon rejected a magistrate judge's finding and rulings by two of his colleagues that big banks could avoid recording notices in local land records each time a loan is sold to other lenders or investors.

Simon sided with two other federal judges in Oregon in ruling that lenders have violated state recording law. They've done this, they say, by logging sales within its nationwide Mortgage Electronic Registration Systems Inc. and declaring MERS a “beneficiary” of the loan.


MERS has no standing to foreclose. The typical mortgage was bought and sold about ten times before it finally got securitized. And those sales and purchases were not recorded at the county recorder’s office. Several important court cases have ruled that servicers using MERS have no standing to foreclose because the chain of title was thereby broken.


  PDF version

*Property rights. Over the past half a millennium western property law was developed precisely to prevent some feudal lord or modern bankster from showing up and claiming title in order to steal property.

Professor of Economics and Senior Scholar 

L. Randall Wray


This is why in the US every property sale had to be recorded—in pen and ink—at the county recorder’s office. The mortgage note and deed had to be retained by the creditor and presented to foreclose on a delinquent homeowner. It had to match the county records of ownership. That has now been destroyed in the US. Anyone with a good enough lawyer and a compliant judge can now claim your property.

Often the banks seize the wrong properties—because MERS (more below) recorded the wrong address. Often they steal homes that never had a mortgage. Or they lose the payments the homeowner tried to make, then claim default, then steal the home. Or they advise the homeowner to stop making payments in order to qualify for a “loan mod” (better terms on a new mortgage, often under one of the government programs)—then steal the home. But banks and their lawyers consider these “victimless crimes”.


Mortgage Settlement Makes “Fraud a Business Expense”

Barry Ritholtz Ritholtz contends that this settlement represents a choice by the Department of Justice to ignore long-settled property laws.

Will Wall Street Ever Face Justice?

NY Times Meager resources have been applied to investigate the financial assault on our country, which wiped away trillions of dollars in household wealth and has resulted in 24 million people jobless or underemployed. The Financial Crisis Inquiry Commission, which Congress created to examine the full scope of the crisis, was given a budget of $9.8 million — roughly one-seventh of the budget of Oliver Stone’s “Wall Street: Money Never Sleeps.” 

Matt Taibbi speaking today at an Occupy Wall Street day of action 

Bank of America is a “raging hurricane of theft and fraud”

Foreclose the Banks The first is that it’s corrupt. This bank has systematically defrauded almost everyone with whom it has a significant business relationship; cheating investors, insurers, homeowners, shareholders, depositors, and the state. It is a giant, raging hurricane of theft and fraud, spinning its way through America and leaving a massive trail of wiped-out retirees and foreclosed-upon families in its wake.

The second is that all of us, as taxpayers, are keeping that hurricane raging.



Attorney General Kamala D. Harris Joins Legislative Leaders to Unveil California Homeowner Bill of Rights

Office of the Attorney General The legislation is designed to protect homeowners from unfair practices by banks and mortgage companies and to help consumers and communities cope with the state's urgent mortgage and foreclosure crisis.

Six bills designed to guarantee: 

- Basic standards of fairness in the    mortgage process, including an end to dual-track foreclosures 

- Transparency in the mortgage   process, including a single point of contact for homeowners 

- Community tools to prevent blight after banks foreclose upon homes 

- Tenant protections after foreclosures 

- Enhanced law enforcement to defend homeowner rights - paid for by fees imposed on banks 

- A special grand jury to investigate financial and foreclosure crime


Wells Fargo Shareholder Report Reveals Information on Foreclosure Fraud Settlement

FDL It’s embarrassing that the most information we’ve yet received about the foreclosure fraud settlement comes from an annual report to stockholders by Wells Fargo. In other words, we had to wait for the banks to tell us what was in the settlement, I guess because the regulatory officials who negotiated it weren’t entirely proud of their work.

EMERGENCY INJUNCTION- Banks, Kicking Down Doors And Taking Property- 


Matt Weidner, Esq. Despite this, Plaintiff, and or its agents, have again, on or around February 24, 2012, entered Defendant’s property and placed a note on her door that they are going to change the locks on her property and winterize the home.
It is important to make one thing clear, Plaintiff is merely alleging that it is a lien holder in this action and more importantly, this honorable Court has taken absolutely no action to allow Plaintiff to enter Defendant’s Property.

Florida House passes bill to speed foreclosures


Housing Wire If a promissory note is destroyed, stolen or lost, the servicer can file an affidavit "that details a clear chain of all assignments" and proves it is entitled to enforce the note.

The bill would take effect July 1, if enacted.

Who didn't hear this train coming?

Yet Another Mortgage Scam: Homeowners Not Getting Cancelled Notes After Foreclosures, Hit by Later Claims 

Regular people are being conned. Judges are being conned. Even many lawyers are being conned. 

Also read Neil's comments in: Why the Original Note (and Ownership) Continues to Be Critically Important

naked capitalism Attorney, Xiomara Cruz, who has taken an interest in this topic, sent a warning to fellow lawyers:

I have seen in dozens if not hundreds of foreclosure suits allegedly “settled” for properties in Florida, MOST only include language satisfying the mortgage BUT DO NOT INCLUDE specific cancelation / satisfaction of the promissory Note. So that in essence your client just got a Release of Mortgage and nothing else.

"Currently they don't even have to say, 'Whoops, sorry' if you lose your home because they made a mistake," he said. "This puts some teeth into the law."

State lawmakers offer bills to revamp foreclosure

Banking industry representatives did not immediately comment on the specific ideas, but warned that new laws could hurt the economy.  

NO, the crooked banking business collapsed the economy!

SFGate A new $25 fee on each notice of default would be earmarked for the attorney general's office to investigate and prosecute real estate fraud, while another bill would authorize a special grand jury to look at such crimes statewide.

The package also creates more ways for cities to combat blight created by vacant properties and gives tenants in foreclosed properties 90 days, up from the current 60, before they can be evicted.


HSBC Caught Committing Fraud Upon the Court; Law Enforcement Notified

Judge Kramer

Supreme Court, 

Kings County, NY

This Court is further reporting the matter to the District Attorney, Kings County, the Attorney General of the State of New York and the U.S. Attorney for the Eastern District of New York. Copies of the two notes are annexed hereto and made a part hereof.



4closureFraud The Fair Housing Act makes it illegal to discriminate in the terms and conditions of a loan to an individual based on a disability, including imposing different application or qualification criteria, and makes it illegal to inquire about the nature or severity of a disability except in limited circumstances not applicable here.

“Holding homebuyers with disabilities to a higher standard just because they rely on disability payments as a source of income is against the law,” said John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity. 


Mortgage Fraud Task Force Skeptics Wait For Strong Leader, Swift Action

Huff Post A task force is a fickle thing. With the right leader, a strong staff, a broad mandate and a target population rich with criminal actors, a team of prosecutors can uncover evidence of wrongdoing, haul away bad guys and change the political dynamic, leading to long-lasting reforms. Or it can do nothing.


Banks Steal Homes, and I have PROOF

If this isn’t a wake-up call for all of America, then nothing is. Foreclosures are littered with fraud … billions of dollars in wealth are changing hands in fraudulent ways … 

Does anyone care?

Clearly, endorsement fraud is pervasive in the foreclosure industry, and it’s about time we all put a stop to it.

Mark Stopa, Esq. A bank (apparently Citimortgage, since it was the plaintiff) wanted to foreclose on the Note and Mortgage entered by Daniel and Christine Hunk, but needed an endorsement from American Home Mortgage. But American Home Mortgage was out of business. So Citimortgage took the endorsement stamp that had been used by Danielle Sterling (from when she worked at American Home Mortgage), stamped it on the Note, and forged her signature.

Dear State Attorneys General: You Failed America. Yes, You.

No, President Obama, 55 investigators is not enough.

Abigail Field The Justice Department should have been pouring resources into investigations and indicting people all over the place. The Justice Department needed to go S&L on these guys, just ramped up for scale. I mean, we used 1,000 FBI and dozens of prosecutors to prosecute the much smaller Savings and Loan Fraud. Heck, we used 100 FBI on Enron. The warmed-over Financial Fraud Enforcement Task Force subcommittee (no it’s not new) has 55 investigators. 

Advocates Respond To Recent Court Ruling with Call To Stop Foreclosures Thru-out State

The Ruling in Beneficial Consumer Discount Company v. Vukman

Home Equity Theft Reporter Housing activists are calling on Pennsylvania banks and sheriffs to temporarily halt all home foreclosures, saying a paperwork error could save thousands of people their homes.

New Jersey's Looming Foreclosure Crisis

As long as NJ allows major lenders to file documents using a private electronic system, there's no way of achieving a transparent review process.

NJ Spotlight In New Jersey, the county clerks and sheriff's officers who are responsible for making sure that all aspects of foreclosures are handled properly have raised an alarm with the attorney general, governor, and the legislature.

It is possible for a lender to take a home through foreclosure although it may not properly hold title to the property, she said.


Constitution Halts Sheriff in Ireland

An interview with Ben Gilroy on The Morning Show

Attorney Ben Gilroy



Attorney Ben Gilroy confronts a group about to carry out an eviction.


Lenders Must Be Named in Foreclosures, New Jersey Court Rules

U.S. Bank v. Guillaume

The Court considers whether defendants Maryse and Emilio Guillaume met the requirements for vacating
the judgment of foreclosure entered against them after they failed to file an answer to the foreclosure complaint.

Bloomberg The state high court in Trenton ruled today that the notice sent to the Guillaumes failed to comply with New Jersey’s Fair Foreclosure Act, which requires the name and address of the actual lender, as well as contact information for a loan servicer. Failure to do so creates “potential for significant prejudice” to homeowners, the court said.

“A misunderstanding about a lender’s identity could prompt a homeowner to make a critical error at a time when he or she is struggling to avert foreclosure,” the court said in the opinion.

Banks Win Reprieve on Home Equity Loans in Settlement

It’s “a gift to the banks, at investors’ expense,” said Goodman, a member of the Fixed Income Analysts Society’s Hall of Fame. “A proportionate write-down of the first and second represents a reversal of normal lien priority.”

“A lot of the principal reductions would have happened on their loans anyway, and they’re using other people’s money to pay for a ton of this

Bloomberg The banks that service about half the nation’s mortgages on behalf of investors will be able to share losses on their junior loans with bondholders and get credit toward the cash they pledged to spend in the settlement.

Bank of America Corp., Wells Fargo & Co. and three other banks that settled a nationwide probe of foreclosure practices this month will get a bonus from the deal: protection for $308 billion of home-equity loans they hold.


Sealink Funding Bear Stearns $2.4 Billion Suit Moved to Federal Court

Amended Complaint

Bloomberg Sealink sued New York-based JPMorgan Chase and units including Bear Stearns and EMC Mortgage LLC in September, accusing them of making misrepresentations about the risks and characteristics of the loans underlying securities bought between 2005 and 2007.

Pity the Poor Judges

This settlement corrupts the court system completely. That or it bogs it down to a point where the cost of litigation, no bargain to begin with, will become out of reach of all but the billionaires.

Think about it, if every bit of testimony on every matter, including pre-trial motions, must be had live and in court to avoid perjured and forged documents; the costs of litigation increases by orders of magnitude

Cynthia Kouril -FDL The alternative is for the judges to acquiesce to allowing forged and perjured documents in their courts. This creates its own momentum. If it’s OK to use forged and perjured documents in mortgage contract cases, then why not in other contract cases? Docx and LPS can expand their business model. If it’s OK in contract cases, what about other kinds of cases? How about opening up a new robo-signing operation to manufacture false business records to give criminal defendants alibis?
2/27/12 Federal Reserve Board releases action plans for supervised financial institutions to correct deficiencies in residential mortgage loan servicing and foreclosure processing

Action plans and enforcement letters

Federal Reserve The Federal Reserve will closely follow the implementation of action plans to ensure that the financial institutions correct deficiencies and evaluate any harm that was done to homeowners in the foreclosure process in 2009 and 2010.

Foreclosure Dispatches: Views From Around the Country

Do you think homeowners in foreclosure proceedings should have a right to counsel? 

Homeowners should have access to prosecutors.

Huff Post What is one aspect of the foreclosure crisis that has been overlooked by the media?

Too many news stories still invoke the notion that irresponsible homeowners are to blame for the housing crisis.


BREAKING: BoNY-BofA Settlement to Return to State Court After Second Circuit Reverses Pauley

The Opinion

Subprime Shakeout The Second Circuit just reversed the ruling of District Court Judge William Pauley in the highly-publicized $8.5 billion settlement between BofA, Bank of New York (BoNY), and Kathy Patrick’s institutional investors over mortgage putbacks; meaning the case will be sent back to state court to be tried as an Article 77 proceeding, rather than a class action.

Terrell Owens Faces Foreclosure on 2 Dallas Homes

AOL Despite raking in over $80 million during his tumultuous career, Owens has lost most of his money to ill-advised investments, which included the $2 million stake he bought in an entertainment complex in Alabama. Its electronic gambling operation was judged illegal.

545 vs. 300,000,000 People

Charlie Reese, a retired reporter for the Orlando Sentinel, has hit the nail directly on the head, defining clearly who it is that in the final analysis must assume responsibility for the judgments made that impact each one of us every day.

Charlie Reese Not one of these taxes existed 100 years ago, & our nation was the most prosperous in the world.
We had absolutely no national debt, had the largest middle class in the world, and Mom, if agreed, stayed home to raise the kids.

What in the heck happened? Can you spell 'politicians?'

Harris Wants Fannie Mae, Freddie Mac to 'Pause' Foreclosures

The two companies own more than 60 percent of California mortgages

The Bay Citizen California's underwater homeowners deserve a straight-forward analysis from FHFA of whether a program of principal reduction by Fannie Mae will provide significant assistance to struggling homeowners as well as save taxpayer dollars," Harris wrote in her letter.

$20 Million in legal fees!!! 

Corrupt Freddie/Fannie execs bilk taxpayers for legal fees

Meanwhile, taxpayers are getting their homes stolen because they can't afford a lawyer to go after these criminals.

Examiner Lawmakers, including then-Senator Barack Obama, protected Fannie and Freddie from proper oversight because they got political contributions from the mortgage giants. In fact, Judicial Watch uncovered records that show for more than six years members of Congress were aware of the massive problems at Fannie and Freddie yet they did nothing. As a result taxpayers are on the hook for at least $400 billion and $5 trillion in mortgage liabilities.


Occupy takes foreclosure protest to Wells Fargo CEO's home

Occupy protesters gathered in front of the home of Wells Fargo chairman and CEO John Stumpf.

"You are in default under a deed of trust held by the American people," according to the protesters' foreclosure notice.

SF Business Times Donna Vieira says a fraudulent appraisal meant her Reno house was $243,000 under water on the day she took out her Wells Fargo mortgage. The Vieira family later lost the home to foreclosure after pouring $350,000 into a down payment and monthly mortgage payments.



These were homes that the banks anticipated taking a $50 billion-to-$100 billion hit on. Only now, they get a tax benefit for it.

Foreclosure settlement a failure of law, a triumph for bank attorneys

The banker who reviewed these files fills out and signs an affidavit, which is then notarized. It is the written equivalent of sworn testimony in court. Judges take affidavits extremely seriously. False affidavits bypass the entire fact-finding and legal process, and the result can be a miscarriage of justice. Anyone who lies on one commits perjury, a felony punishable by jail time.

Washington Post We never want to see an innocent party “accidentally” evicted from a home. The legal system has evolved so this has become a “legal impossibility.” Imagine returning home from work or vacation to find the front door padlocked, the belongings strewn all over the block, a big orange sticker screaming “FORECLOSED” on the garage door, with an auction sign in the front lawn. Now imagine that this occurred even though you are not in default or even delinquent on payments. Thanks to the robosigning banks, this legal impossibility has happened repeatedly, even to homeowners who paid cash for their houses and had no mortgages. Imagine that — foreclosed with no mortgage.

Accountability – Hold On To Your Hats! The Dominoes Are Falling … and Falling and Falling

How much of that money will land in the pockets of these 'resigning' bankers and politicians....and will we just let them fade away without prosecutions and 'hangings'? 


Stephen Cook With an ear to the ground,
many of you are aware that banking fraternity are answering for their corrupt financial dealings. It is the commencement of more far reaching actions that shall ultimately remove the cancer that they have brought into your society.

In trying to control the world's wealth, they have unwittingly brought about their own demise. It has also led back to political persons who have benefited from their crimes, and they also will be removed.

Free Online Book


Roger Weidner is a former attorney and public prosecutor who battled pervasive corruption in the Oregon court system for 12 years as he struggled to return the now-valued $100 million Kettleberg estate to its rightful beneficiary after it had been wrongly seized by an unscrupulous but well-connected attorney.

Roger Weidner


For his efforts, Weidner was repeatedly arrested, imprisoned, confined to an insane asylum, and finally disbarred. His story, as told to H. Hammond, testifies to how the judiciary has usurped the law for its own purposes and replaced constitutional guarantees with a system in which judges rule by decree. It exemplifies the failure of meaningful accountability within the judicial branch.


is a


Anyone surprised?

Insider Says Wells Fargo’s Independent Foreclosure Review for OCC is “a Sham”

I have found errors that should be moved up through the ranks, but am told “quit digging so deep”…”put your shovel away”…Focus on the questions “in scope”… The review forms are set up so no harm could ever be found.

Mandelman Matters I was hired as one of those “Independent File Review Specialist” at a company called Promontory working on Wells Fargo Bank. I have 15 years industry experience in all facets of the mortgage & title industry, and just needed a job at the moment.

I must say the whole project is a mess, and a terrible joke on the victims of foreclosure and the American people. It’s a total sham.



Banks Colluding with Insurers to Rip Off Homeowners, Lawsuit Alleges

The judge also said Wells Fargo has actually threatened to retaliate against homeowners who join the suit.

Certification OrderWilliams v. Wells Fargo

ProPublica As American Banker reported, a federal judge in Miami on Tuesday opened the door to a class action against Wells Fargo. More than 20,000 Florida homeowners can now sue Wells Fargo and an insurance company, QBE, for allegedly overcharging for insurance. More than $50 million in insurance premiums are at issue

Donovan: The Foreclosure Fraud Settlement Is Strong Because of the OCC Settlement

For families who suffered much deeper harm — who may have been improperly foreclosed on and lost their homes and could therefore be owed hundreds of thousands of dollars in damages — the settlement preserves their ability to get justice in two key ways.

David Dayen


Among the fundamental principles of any functioning justice system is the following: Don’t lie to a judge or falsify documents submitted to a court, or you will go to jail. Breaking an oath to tell the truth is perjury, and lying in official documents is both perjury and fraud. These are serious criminal offenses, but apparently not if you are at the heart of America’s financial system. On the contrary, key individuals there appear to be well compensated for their crimes.

Whistleblower accuses Countrywide of appraisal fraud

According to the unsealed complaint, the whistleblower, Kyle Lagow, witnessed first-hand the "corrupt underwriting and appraisal process" at the lender. Lagow worked in a Countrywide appraisal unit in Plano, Texas.

Reuters The False Claims Act is a federal law designed to recover money taken from the government by fraud, and discourage further wrongdoing.

Forgive Principal Only If the Borrower Pays the Mortgage

The greatest threat widespread negative equity presents to the U.S. residential markets is not necessarily the negative equity itself, but rather the losses associated with underwater loans that do default.

Bank Think Losses suffered in a default are often two to three times more than the total amount of negative equity. In other words, the ultimate loss to the investor (which can be the U.S. taxpayer and pension funds, in many cases) can be as high as $50,000 on a mortgage of only $100,000, even if the loan is only $20,000 underwater. Finally, the industry cannot stop defaults caused by negative equity by using solutions designed to address affordability.


Scammers try to Hijack Project: Save Our Homes

Beware of scammers who say they are working with banks as part of a recent mortgage-foreclosure settlement

wvnstv "Unfortunately, thieves often prey on those most in need," said McGraw. "Homeowners should never provide their bank account and routing numbers in the belief that this is a legitimate part of the settlement."

The thieves may pose as third-party companies "working with the settlement" or as a representative of one of the five participating banks.

A Foreclosure Trial Transcript, Evidentiary Objections Made and SUSTAINED, Judgment for Defendant!

This is a roadmap that shows how to do it correctly….bone up folks, work hard.

Parris Transcript

Matt Weidner, Esq. Servicers have a very real problem proving their cases over proper and clear evidence objections….they just cannot link up their evidence from one servicer to another without real effort…and in some cases they will not be able to do it.

HSH Nordbank Sues Barclays Over Mortgage Backed Securities

HSH 4-page Summons & Notice


Bloomberg HSH Nordbank AG (BARC), a regional German lender that was bailed out during the financial crisis, sued Barclays Bank Plc in New York over the purchase of $122.7 million in residential mortgage-backed securities.

Survey: Bad Foreclosure Practices Still Rampant

If you thought all of the bad press covering robo-signing and shady foreclosure practices would make big banks think twice about foreclosing on struggling homeowners, think again. 

US News The main problem is a lack of accountability on the part of banks and mortgage servicers.

In other words, banks and mortgage servicers have been told by the federal government to stop initiating foreclosure practices while loan modifications are underway, but have simply not complied.


Bank of America Breaks With Fannie Mae

Bank of America said Thursday that it would no longer sell new mortgages to Fannie Mae.  (In other words, Fannie won't buy its crappy loans, so they are going to peddle the crap to Freddie and Ginnie. MSF)

  The latest move represents a major escalation in a protracted legal battle over how many defaulted mortgages Bank of America will have to buy back from Fannie because the original loans had not conformed to proper underwriting standards.

AG Announces $469,500 Mortgage Fraud Trial Decision

njToday “This is an important win on behalf of New Jersey citizens,” Chiesa said, “not only because it provides restitution for homeowners who were harmed by the defendants’ fraudulent actions, but because it sends a clear message that we will not tolerate this kind of predatory, greed-driven conduct.”

Mass Court May Rule on Retroactivity of some Foreclosures Tied to 'Naked Mortgages'

Eaton raises an additional point that has excited interest - whether or not that foreclosure can be challenged and compensation enforced on a retroactive basis or whether such retroactivity exacts too high a cost or permanently clouds title. 

Amicus Brief of Marie McDonnell 

Mortgage News Daily This is another in a series of cases challenging the right of various lenders and nominees to foreclose on delinquent mortgages based on assertions that those parties do not own or at least cannot prove they own the enabling legal documents. 

The SJC ruled last year on two foreclosure cases that handed properties back to owners on naked mortgage grounds. The Ibanez case, referenced above dealt with two single family houses, but in Bevilacqua v. Rodriguez the court handed an apartment building back to the previous owner five years after the foreclosure.


Dallas DA not worried about U.S. Court siding with MERS

Housing Wire "The Christian County case was decided based upon Kentucky statutes. The Dallas County action is based upon Texas law which provides the county with express statutory authority to assert claims included in the action."

Ohio Courts' Reluctance To Admit Fraud Causes 16 Years of Foreclosure Litigation

What would be the condition of Cleveland today if its courts had taken a proactive approach to tainted foreclosures when it first noticed the problem in 1996? 

MSFraud This week, Ohio’s 8th District Court of Appeals heard oral arguments in what must be one of the most disturbing foreclosure cases in the nation’s history.

Davet claims he still has legal title and his latest appeal is an action to get his home back. It is an important issue.

2/23/12 "Amazing Opportunity" In Detroit Real Estate Peddled To European Investors

Nothing More Than 'Motown Money Pit' Of Looted Homes, Squatters, Tax Bills

Home Equity Theft Reporter But now at least a dozen overseas investors say their more than $2 million in investments have become a trans-Atlantic money pit. They are left with empty, unrepaired houses in Detroit and have tried to convince local law enforcement officials to take action. To date, none have.

Survey Results

Mortgage Servicers Continue to Wrongfully Foreclose on Homeowners
According to a Recent National Survey of Consumer Attorneys

National Consumer Law Center “This survey
provides yet more evidence that banks wrongfully foreclose on tens of thousands of homeowners
every year,” said National Consumer Law Center Attorney Diane Thompson. “Until rigorous
national mortgage servicing standards that are enforceable by homeowners are put in place by
the federal government, banks will continue to seize homes illegally and routinely.”


Wells Fargo Suffers Setback in Force-Placed Insurance Case

Order Denying Wells' Motion to Exclude Expert, and Order Granting Plaintiff's Motion to Certify Class Williams v. Wells Fargo

American Banker A federal judge has granted class action status to plaintiffs in a much-watched force-placed insurance case against Wells Fargo & Co. and QBE Insurance Inc., opening the door to high-stakes litigation over alleged industry kickbacks.

Foreclosure Story Untold in Hollywood

In Hollywood, there are untold screenwriters, actors, directors and others invisibly struggling to keep their homes.

NY Times She told me she was worn out from two years of wrangling with her bank, one of those named in the settlement deal.

I saw my other neighbors, the soap-opera actors, evicted with their crying child, their soaked belongings crammed into the back of a borrowed van, their dark, empty house with the holiday decorations still in the windows.


Responding to Critics, S.E.C. Defends ‘No Wrongdoing’ Settlements

People won’t settle with us if they have to admit” wrongdoing" Ms. Schapiro said.

NY Times According to a New York Times analysis of enforcement cases, nearly all of the biggest Wall Street firms have settled fraud cases by promising never to violate a law that they had already promised not to break, usually multiple times. In addition, the Times analysis showed, those settlements also repeatedly granted exemptions to the biggest Wall Street firms from punishments intended by Congress and regulators to act as a deterrent to multiple fraud violations.


Yes, Virginia, Foreclosure Is Theft

There’s a lot of pushback anytime someone points the finger at banks. As I’ve argued for a couple of years now, virtually all recent foreclosures really amount to theft.


L. Randall Wray

The banks have no legal standing to take homes. They created the MERS monster, which destroyed the chain of title and “lost” all the documents. That is why the mortgage servicers hire robo-signers to forge new ones. Yet, 4 years into the crisis, almost no one wants to admit the truth. Foreclosure in the US is theft–as practiced it is almost always illegal. Yet, the servicers are now ramping up foreclosures after they bought out the state attorneys general.

Courts to Hasten Efforts to Prevent Foreclosures

In at least 19 states that have such court programs, efforts to settle foreclosure cases have often met with obstacles, including what some judges have found to be bad-faith negotiations by lenders.

NY Times “It is an important step forward” because it increases the involvement of judges with the power to punish defiant or disorganized lenders, said Geoff Walsh, an expert on foreclosure policy at the National Consumer Law Center in Boston.

Wells Fargo’s Servicer-Driven Foreclosure:  Is Stumpf’s Company Vicious and Incompetent or Vicious and Greedy?

The example involves Bank of America  as servicer, but there’s no reason to think BofA is alone in this theft.

Still, there’s other ways to siphon a gusher of fees en route to a REO sale.

Abigail Field And apparently Wells Fargo is so bad about charging too many and excessive fees, they’ve been sued (along with JPMorgan Chase) over their practices. These fees come first from the homeowner, but when there’s not enough equity to cover them and the mortgage at foreclosure sale, they also come from investors. And these days, it seems there’s never enough equity to cover the mortgage, much less the fees. 

So Wells Fargo is systematically ripping off homeowners and investors.


Kentucky Court Throws Out MERS Lawsuit

A federal court in Kentucky has dismissed a suit against MERS brought by that state's county clerks. The court dismissed the case "with prejudice.

Bankers Tradesman MERS is claiming a victory. However, they don't have anything to celebrate. Although the court did dismiss the suit, it was dismissed on a very narrow point - the clerks don't have standing to bring the suit. The court did not rule on the merits of the case because they addressed the standing issue only. Homeowners in KY could bring the same suit against MERS and probably win.

New Study From Consumer Advocates Shows Mass Servicer Abuse

In other words, the banks are under an order to stop doing these types of things, and they have simply not complied.

That’s the state of things heading into the settlement, when the banks will be asked to comply again.

We’re in the fifth year of the foreclosure crisis. If servicers haven’t cleaned up their act by now, signs point to the fact that they can’t. But instead of putting the model out of business, the authorities played nice with them.

David Dayen


These numbers are simply too high to be an accident. 

The results of a survey show Servicers routinely place people in foreclosure while negotiating a loan modification, and they routinely apply illegal fees to homeowners, helping to drive them into default.

And the government settled with these companies!

Servicers Continue to Wrongfully Initiate Foreclosures:


Bay State High Court Ruling Expected Soon On Need To Hold Note In Order To Foreclose Mortgage

The highest court in Massachusetts is poised to rule as soon as this month on a foreclosure case that could lead to a surge in claims from home owners seeking to overturn seizures.

Links to the briefs filed in the Eaton case.

Home Equity Theft Reporter The Massachusetts Supreme Judicial Court justices signaled last month they may rule in favor of Eaton when they asked parties in the case to submit briefs arguing whether such a decision should be applied retroactively or only to future lending. If retroactive, it would cloud the titles of the 40,000 Massachusetts properties seized in the last five years and while the ruling only applies to the state, it could serve as a model for homeowners trying to overturn foreclosures in other states.
White Paper



Property Title Trouble in Non-Judicial
Foreclosure States: The Ibanez Time Bomb?

This article explores the extent to which the Ibanez and Bevilacqua rulings should influence the courts in other non-judicial foreclosure states and the likelihood that clear title to foreclosed properties is jeopardized by shoddy or fraudulent handling of notes and mortgages.

Elizabeth Renuart
Assistant Professor of Law
On one side of the contest resides the integrity of the courts, the law, and property recordation systems, as well as, the related public policy in favor of strict compliance with non-judicial foreclosure procedures designed to ensure that only the proper parties ousts homeowners from their homes.

All over the country, courts are scrutinizing whether the parties initiating foreclosures against homeowners have the right to take this action when authority to enforce the note and mortgage is absent. Without this right, foreclosure sales can be reversed.


John O’Brien: Mortgage Settlement Fails to Address Banking Criminal Enterprise 

If a county official with limited resources can show that there are widespread abuses, what is the excuse of state and Federal officials for their failure to understand the depth and severity of these problems?

naked capitalism "I will continue to pursue my request for Federal and State grand juries to be impaneled to hold the CEO’s of these banks liable for the crimes that have been committed under their watch. The only thing missing in this illegal scheme that MERS and the big banks came up with was a gun and a mask."

"Unless we face the facts and approach this with common sense we will be talking about the same issues a year from now and I am not sure we can wait that long."


Foreclosure Scout Shares The 'Dirty Tricks And Blatantly Illegal Practices' Of His Job

We would break & enter all day, every day...

Business Insider An anonymous foreclosure scout recently described the "ins and outs, all the dirty tricks, blatantly illegal practices". 

Legal Fees Mount at Fannie and Freddie

The three former executives were accused of a comprehensive accounting fraud that the company’s former regulator said was aimed at maximizing their bonuses.

Gretchen Morgenson

NY Times

But with legal outlays since 2004 reaching $99.4 million for Franklin D. Raines, Fannie Mae’s former chief executive; J. Timothy Howard, former chief financial officer; and Leanne G. Spencer, former controller, it seems unlikely that the taxpayers will ever recover the money even if some or all of them are found liable.

They're Still Trying to Spin This (Robosigning "Settlement")

The biggest problem with the so-called "mortgage settlement" is that most of it won't come from the parties who did the harm at all -- it will instead come from the taxpayer.

Karl Denninger

Market Watch

If we had the rule of law then there would be 100,000+ felony counts working their way through the courts on the admitted acts of perjury, and hundreds of thousands more for various acts of fraud along the way from origination to alleged "conveyances" that never happened to banks making credit bids at property auctions when they are not the real party at interest, which is flatly illegal (you can't bid an interest you don't have -- check your state laws on this.)

Banks face crisis in bungled commercial mortgages

The nation's banks are looking at a robo-signing problem with commercial real estate which may dwarf the one for home mortgages, according to a new study.

CBS News Just as with residential real estate, commercial real estate mortgages were bundled and re-sold by lenders as securities. Holders of those securities, already reeling from the glut of empty office space, will be hit even harder if it turns out they have no claim to the properties. They would likely sue the lenders for falsely representing the properties. Mortgage holders in these cases may also turn to their title insurance to cover any losses


El Paso Joins the Hunt for MERS, et al

The Complaint in Huml v. FNMA and MERS

Richard Roman, Esq. and former judge Plaintiff moves the Court to pierce the MERSCORP and MERS corporate veils and impose liability upon each Defendant shareholder in MERSCORP and MERS for the actionable conduct of MERSCORP and MERS alleged herein.

Rendered 12/2011

McCarthy v. Bank of America, BAC and FNMA

U.S. District Court Fort Worth, Texas "There is nothing in the record before the court at this time
establishing that plaintiff cannot prevail on her theory that the
foreclosure on her property was improper because it was conducted
by, or at the behest of, BOA at a time when BOA did not own or hold the note that was secured by the deed of trust pursuant to which the foreclosure was conducted.

Should California's foreclosure-mill lawyers worry?

Man faces possible life sentence if convicted of housing scam

L.A. Times A man accused of defrauding desperate Los Angeles County homeowners out of hundreds of thousands of dollars is scheduled to stand trial this week on charges that carry an unusual sentence for a white-collar fraud case.



Despite the fact that this mortgage “asset” no longer exists, the trust is still claiming this mortgage as an asset as of the Jan 2012 investor report, charging all sorts of fees, including monthly servicing fees, etc.

Foreclosure Hamlet


This is just a small example of what we are uncovering. If we learned anything from the robosigning scandal, if there are more than two “irregularities,” there are thousands.

Snip from Property Sales records for Elsa Castillo Rivas’ July 29, 2011 short sale kept on trust books through Dec 2011. 
WOW – BofA monthly servicing fee for non-existent mortgage = $328.04


Foreclosure measure advances in Senate

Supporters also emphasized the increased focus on abandoned properties in the bill.  When studies show about 80% of foreclosures are illegal, the problem of abandoned properties becomes the fault of derelict robo-judges knowingly granting illegal foreclosures.

Gainsville One Port Charlotte homeowner called lawmakers backing the bill a “disgrace,” while others accused them of seeking to undercut private property rights in favor of supporting lenders.

Nearly a dozen consumer activists and homeowners battling foreclosure in this region and across Florida sharply criticized the bill, arguing that the legislation will make fighting fraudulent foreclosure actions more difficult. Last week, the legislation drew about 100 protesters to the Capitol.



Bill to speed up Florida foreclosures pauses

Even to some in the mortgage industry, the Passidomo bill overreaches, said J.T. Smith, chief investment officer of the Florida-based boutique investment bank Aristar Funding Corp. Smith said speeding up the process for abandoned properties made sense, but foreclosing on the borrower based almost entirely on the bank's word isn't fair.

Housing Wire "We have witnessed that plaintiffs are not beyond the forging of documents, notes, deeds, etc.," Smith said. "The lending community has a ton of notes out there that were endorsed in blank, that means essentially these notes are like bearer bonds, whomever has possession is the owner. We, as lenders, made this mistake by using the endorsed in blank to save money on recording transfers, now we, as an industry, must reap what we have sowed."

Some Doubt a Settlement Will End Mortgage Ills

Rules will apply nationwide and come with commitments of strong enforcement by federal and state authorities, but they carry a familiar ring for those experienced in the foreclosure process.

NY Times Last April, the industry made many of the same pledges under a consent order with the Office of the Comptroller of the Currency and since then, consumer representatives say, there has been barely any improvement, adding that loan files continue to be handed off from one agent to another, sometimes weekly, and that even when a single person is assigned to their cases, one phone call after another goes unreturned.

Homeowner Threatened with Loss Of Home Over Crappy Title Issue Arising Years After Purchase; 

BK Trustee Says Land Was Subject Of Fraudulent Transfer

Home Equity Theft Reporter Once a mistake is made with respect to a title, Donalson said, it's easy for that error to be repeated the next time the property is sold. "They just took the policy forward, and in searching it forward, they may not have picked up on the prior problem," 

"I'm hearing more and more of this sort of thing," McCabe said.


Bank foreclosure fraud to be rewarded at taxpayer expense 

This means that taxpayers will be funding up to 63 percent of the $25 billion in mortgage modifications promised by the five banks.

Obama could claim that his mortgage modification program has helped millions of people, and while publicly chastising the banks, let them get away scot-free with fraud and unlawfully evicting hundreds of thousands of homeowners. Neil Barofsky, the former Special Inspector General of the Troubled Asset Relief Program, called the revelation “scandalous” in an interview with the Financial Times last week, saying, “It turns the notion that this is about justice and accountability on its head.”
“If the banks are doing something under this settlement, and cash flows from taxpayers to the banks, that is fundamentally an upside-down result,” he added

Shocking Economic Insight – Mass Foreclosures Will Drive Down Home Prices

If anything, the data suggests judicial foreclosure is dampening home price declines in MD, by slowing foreclosures and the drag they place on home prices.

Michael Olenick Less foreclosure inventory in judicial foreclosure states, thanks to slower foreclosure processing, reduces supply and stabilized home prices is a simpler explanation, though it’s seldom explored. I’ll refer to it as the Linda Green House Price Stabilization theory.


Study reveals foreclosure fraud in almost all cases

Lenders have endlessly foreclosed on homes they do not even own.

AGBeat Experts point to the robosigning scandal and the role of MERS in housing to have caused chaos in housing with lenders foreclosing on wrong addresses or loans that they never completed paperwork on or reviewed prior to repossessing properties. When mortgages were packaged and repackaged to investors and lenders acquired each other or shut down, the chain of title barely exists and in many cases, it is unclear who actually holds a loan.

San Francisco Foreclosure Audit Elicits Predictable Responses from Securitization Mess Deniers

naked capitalism And he finally takes aim at the “who cares, they are just deadbeats” argument. As we have said repeatedly, that just ain’t always so. A must read article from the Center for Public Integrity discusses how common servicer foreclosures are. An extract:

Arizona’s SB 1451 – Does Arizona Have the Right to Save Itself from Drowning in Underwater Loans?

Consumer spending in Arizona would increase almost overnight as homeowners once again would view their homes as valued assets, instead of as depreciating liabilities. 

Mandelman Matters It’s not hard to imagine that the home improvement market would be among the first to spring to life as homeowners re-started projects delayed during the prolonged downturn in home prices and the broader economy, and that sort of spending means immediate jobs for tens of thousands of Arizonans.

Icelandic Anger Brings Debt Forgiveness in Best Recovery Story

Bloomberg The island’s households were helped by an agreement between the government and the banks, which are still partly controlled by the state, to forgive debt exceeding 110 percent of home values. On top of that, a Supreme Court ruling in June 2010 found loans indexed to foreign currencies were illegal, meaning households no longer need to cover krona losses.

Irate Homebuyer Wants Cash From Seller's Bank After It Locked Her Out Of Her Newly-Purchased Home That Had Recently Fallen Into Foreclosure

Home Equity Theft Reporter Goodloe called the selling agent, who informed her that the seller had received paperwork from Citibank about a week earlier saying the property was in foreclosure. “The closing attorney told her, ‘Everything is OK. The bank is going to take care of it, so don’t worry about it.’ And then Monday, they changed the locks.”

The Future of Big Banks

NY Times But what about the principles of accountability and responsibility? A more effective approach would be to require a five-year claw back of compensation, stock options and benefits paid to directors, the chief executive, the chief financial officer and the corporate risk officer. 

Bonds Backed by Mortgages Regain Allure

NY Times Having reaped big gains during both of those turns, Greg Lippmann, a former star trader at Deutsche Bank, is now catching the next upswing: buying the same securities built from mortgages that he bet against before the financial crisis erupted.

Foreclosure Fraud Epidemic Sweeps the Country

Alarming reports from diametrically opposed areas of the United States are revealing that mortgage lenders and the law firms representing them are still engaged in highly dubious foreclosure practices.

The Niche Report In courthouses and judicial complexes across the country, lenders have retained aggressive law firms that have been labeled as foreclosure mills. Even though borrowers have greater recourse in judicial foreclosure states, the foreclosure mills are alleged to have employed strong-arm tactics against homeowners in order to accelerate repossession and eviction.

Mortgage Fraud: Local Officials Step Up To Uncover Document Fraud

"What we have for the first time is hard data about the level of systematic problems FRAUD going on in the mortgage industry."

"And part of the reason why we don't have more loan modifications for borrowers is because the banks don't know if they own that mortgage because the documents are messed up.

Are judges not concerned they may be aiding and abetting?

Huff Post Nancy Pelosi (D-Calif.) called on U.S. Attorney General Eric Holder to follow up on the report's findings and launch an investigation to determine if federal laws were broken.

"They'd come in and we'd tell them they can sign an affidavit attesting to the fact that they are who they say they are on these documents. Take a wild guess at how many affidavits have been signed. Zero! Zero!"


Panic Time for Banks: “Auction” Sales Were Faked — REO Titles Invalid

Neil Garfield

Living Lies

The defect in the argument of the banks and servicers was that they may have had a colorable right under some agency agreement to initiate foreclosure proceedings but ONLY the CREDITOR can submit a credit bid at the auction. Research your state statutes. They are all very clear. Instead these banks and servicers bid the properties in for themselves as though they were the mortgagee — when in fact they were not even mentioned in the mortgage. 

California AG To Review San Francisco Foreclosure Fraud Report

"The allegations are deeply troubling and, sadly, no surprise to homeowners and law enforcement officials in California," Harris says.

MortgageOrb The study also determined it was possible that some homeowners were falsely accused of defaulting on loans - including loans that they had never agreed to in the first place - and that lenders who did not own the loans were driving the foreclosures.

Confirmed: Banks Can Use HAMP, and Reap HAMP Incentive Payments, in Foreclosure Fraud Settlement

So if a bank reduces principal on a loan on their books, and they do it through HAMP, that bank will get, under the new HAMP rules, 63 cents on the dollar for the principal reduction, and more if the borrower stays current... 

FDL ...And if they do them in the first year of the settlement, they get even more money as incentive. So if a bank reduces principal on a loan on their books, and they do it through HAMP, that bank will get, under the new HAMP rules, 63 cents on the dollar for the principal reduction, and more if the borrower stays current. 

Nobody Committed Any Crimes (Except Fraud!)

First, MBIA says it has evidence of "widespread mortgage-origination fraud" at Countrywide:

Karl Denninger

Market Ticker

The global banking giant HSBC lodged a complaint that blocked access to a WND story reporting a whistleblower’s charge that the London-based corporation has engaged in a massive international money-laundering scheme.

(Again) "Nobody Committed Any Crimes" 

A group of traders and brokers successfully managed to manipulate an interest rate that affects loans around the world, one of the banks being investigated has told regulators.

Market Ticker The problem with this position is that almost-literally every day we find out more about actual crimes that are either alleged or proved, which leads one to question exactly why any politician or candidate (who, incidentally, requires votes from the people to obtain and hold office) would take this position when clearly the common man is the one who gets repeatedly hosed by this behavior.

Citigroup whistleblower: I have no regrets

The case is U.S. ex rel. Hunt v. Citigroup Inc. (C), 11-cv- 005473, U.S. District Court, Southern District of New York (Manhattan)

Bloomberg The government accused CitiMortgage of misleading it into insuring thousands of risky home loans that it knew or should have known did not qualify for insurance from the Federal Housing Agency, costing taxpayers nearly $200 million in claims.

The Best, Most Revealing Reporting on the Foreclosure Crisis

ProPublica The housing crisis in the U.S. has now been going on nearly five years, with still regular revelations about misdeeds by banks and others. Here’s our round up of standout reporting on the crisis.

Citi, BofA prove too big to punish harshly

Reuters The penalties for ripping off the government usually go beyond dollars and cents. Yet Citi’s fine, in particular, is hardly crippling. And BofA has already set aside enough money to cover a good chunk of its settlement. A temporary ban on doing business with the FHA, on the other hand, would deliver more punch and show others in the industry that Washington won’t tolerate abuses of its largess.

Yet that’s unlikely to happen


Banks’ mortgage registry under fire

Bay State counties look to sue over private trades

Officials also claim the MERS system keeps documents private when they are supposed to be public.

Boston Herald Three Boston-area counties plan to sue the banking industry’s MERS, claiming it helped large lenders improperly trade mortgages among themselves and avoid millions in filing fees.

Norfolk, Plymouth and Bristol counties have all signed on with law firm Bernstein Liebhard, which is lining up counties across America to sue MERS.


MBIA tells judge of newly uncovered Countrywide fraud database

Thomson-Reuters MBIA is requesting the judge order Countrywide to produce discovery on an internal fraud-tracking database "which MBIA had not previously known to exist." MBIA said it needs the discovery to prepare for upcoming depositions of former Countrywide employees who tried to expose its allegedly fraudulent mortgage underwriting practices

How Citibank Dumped Lousy Mortgages on the Government

In the settlement, Citi, which was bailed out by taxpayers in 2008 to the tune of $45 billion, "admits, acknowledges, and accepts responsibility" for passing on bad loans.

ProPublica The whistle-blower who originally brought the case, Sherry Hunt, an employee of Citi's mortgage department, said the company actively undermined the process that was supposed to check for fraud in order to push through reckless loans and get higher profits.

The suit itself makes for good reading.

Citigroup Whistle-Blower Says Bank’s ‘Brute Force’ Hid Bad Loans From U.S.

Four years after rotten mortgages helped trigger a global financial crisis, Sherry Hunt said her Citigroup Inc. quality control team was still finding flaws in new loans.

The suit was filed under the False Claims Act, charging that the company defrauded the government.

Bloomberg Records Erased
In one instance, employees erased records of about 1,000 loans that Hunt’s quality-control team identified as possibly fraudulent, according to the complaint. Defects identified by the quality-control team didn’t make it into reports, a violation of HUD requirements.
“A substantial percentage of those claims resulted from loans that were ineligible for FHA insurance and never should have been insured,” the government said in the complaint.

Quelle Surprise! Taxpayers Will Be Paying for Part of Mortgage Settlement

naked capitalism But in the topsy-turvy world of cream for the banks, crumbs for the rest of us, we have, in the words of Scott Simon, head of the mortgage business at bond fund manager Pimco: Lots of victims paying for banks’ misdeeds.
Press Release


National Notary Assoc. To Explore Emerging Issues From "Robo-Signing" Foreclosure Crisis

On February 29, Chris Sturdivant, the NNA's Business Development Executive, will participate in a panel presentation in Washington, D.C., sponsored by the Property Records Industry Association (PRIA) entitled "Probing the Future of the Property Records Industry -- A Land Summit."

National Notary Association

Press Release

Sturdivant will be joining representatives of Mortgage Electronic Registration Systems, Inc. (MERS), the American Land Title Association, the FBI, the Mortgage Bankers Association (MBA) and many others in discussing "robo-signing" issues, electronic notarization, mortgage fraud prevention and other topics.
2/16/12 Foreclosure mediation could save billions

New research says it pays to help struggling homeowners.

UT San Diego “Evidence shows that effective foreclosure mediation can keep paying borrowers in their homes for the long term while also saving billions of dollars for taxpayers and investors,” said Geoff Walsh, an attorney at the National Consumer Law Center and author of the report.
2/16/12 Foreclosures on the Rise Again

"We expect the pattern of increasing foreclosures to continue in the coming months, especially given the finalized mortgage and foreclosure settlement." 

CNBC "Foreclosure activity increased on a year-over-year basis for the first time in more than 12 months in Florida, Illinois, Indiana and Pennsylvania, following a pattern we saw in late 2011 in states such as California, Arizona and Massachusetts."
2/16/12 Homeowners Receive Short Sale Cooperation Housing Predictor The increase in short sales is being driven by investors calling for banks to cut their losses, resulting in a reduction of homeowners walking away from their home mortgages.

Court Rulings Lean Heavily Against Screwed Over Homeowners Seeking To Sue For Banksters' HAMP Violations  (additional links provided)

There have been two cases in which the opposite result was reached, both in the Southern District Court of California. A third trial court decision finding a private right of action is on appeal in Tennessee.

Home Equity Theft Reporter Most of these lawsuits are subject to a motion to dismiss for failure to state a claim, because the vast majority of courts around the country have concluded that neither HAMP nor the Emergency Economic Stabilization Act of 2008 (EESA), under which the HAMP program was crafted, provide borrowers with a private right of action.

Illegal Foreclosures Widespread Across U.S., Experts Say

Reuters A report this week showing rampant foreclosure abuse in San Francisco reflects similar levels of lender fraud and faulty documentation across the United States, say experts and officials who have done studies in other parts of the country.

Foreclosure abuse rampant across U.S., experts say

"The audit in San Francisco is the most detailed and comprehensive that has been done - but it's likely those numbers are comparable nationally," Diane Thompson, an attorney at the National Consumer Law Center

Reuters One factor that probably caused the particularly high 84 per cent rate of illegal foreclosures in San Francisco is that California is a "non-judicial" foreclosure state.

In other words, the foreclosure process does not need to be overseen by a judge. That left the conduct of lenders in California - one of the hardest-hit states in terms of foreclosures - largely unscrutinized until the robosigning scandal gained prominence in late 2010.
2/16/12* Related to the Audit Report below.

San Francisco Assessor-Recorder Phil Ting Finds Widespread Mortgage Document Fraud

It’s incredible to me how the smallest players could so quickly uncover evidence of foreclosure fraud, and the large institutional regulators choose not to even try.

Ting also found that the foreclosure data didn’t match MERS records on the loans, which breaks the chain of title and really drives a stake through the heart of the public land recording system in America

David Dayen


Registers of deeds and county recorders like Ting, Jeff Thigpen and John O’Brien have done more investigative work than most federal agencies. 

Abigail Field, a freelance reporter working for Fortune, did more by going to the local courthouse and finding that Countrywide did not properly engage in the securitization process of sending notes to trusts than practically any Attorney General. As Adam Levitin says, this shows that the only barrier to a real investigation of the mortgage industry is will.




Audit Uncovers Extensive Flaws in Foreclosures

The depth of the problem raises questions about whether at least some foreclosures should be considered void, Mr. Ting said.

An audit by San Francisco county officials of about 400 recent foreclosures there determined that almost all involved either legal violations or suspicious documentation.


Gretchen Morgenson

NY Times

Kathleen Engel, a professor at Suffolk University Law School in Boston said: “If there were any lingering doubts about whether the problems with loan documents in foreclosures were isolated, this study puts the question to rest.

Also see: San Francisco Assessor-Recorder Phil Ting Finds Widespread Mortgage Document Fraud

Press release on YouTube

SF Audit Finds   Irregularities in 99 Percent of Foreclosures

Report commissioned by Phil Ting concludes: "California’s foreclosure process appears utterly broken"

Bay Citizen

How can any industry (besides government) survive doing something wrong 99% of the time? 

In 85 percent of the loans, homes were lost to people or corporations who lacked the authority to foreclose on properties, the auditors found.


Washington AG Rob McKenna sides with consumers and homeowners vs. MERS foreclosures

AG amicus brief

Oregon Live Earlier today, The Associated Press reported that McKenna on Feb. 2 returned nearly $14,000 in campaign donations from individuals tied to Routh, Crabtree, Olsen and Northwest Trustee Services, Inc., firms that represent parties foreclosing on homeowners.

In response to the above audit, Professor Levitin asks:

Why No Investigation?

As the SF City Assessor's audit shows, the documentation is all a matter of public record. It's not that hard to do, especially if you have the resources of the federal government. So the resources were there. The capability was there. So why no investigation? The answer has to lie with lack of motivation. Were the Feds and AGs scared of what they would find if they delved too deeply into the issue? 

Prof. Adam Levitin The San Francisco City Assessor managed to accomplish in a few months what the Federal government and state Attorneys General weren't able to do in nearly a year and a half with far greater resources at their disposal.

The audit examined 400 foreclosures. It found problems with 85% of them, often multiple problems. What's more, some of the problems are pretty serious as they implicate not only borrowers' rights, but the integrity of mortgage-backed securities and the property title system



Plaintiff as Servicer? I Think Not.

These arguments don’t even begin to make sense, but that’s what the servicer was arguing today. “I don’t know who gave me authority, but I have authority.” 

Mark Stopa, Esq. Essential to the existence of an actual agency relationship is (1) acknowledgment by the principal that the agent will act for him, (2) the agent’s acceptance of the undertaking, and (3) control by the principal over the actions of the agent.

Judge in SEC’s Bear Stearns case catches Rakoff fever

Hearing transcript

Alison Frankel


The real story at Monday’s hearing was Block’s stream-of-consciousness musings on the appropriate role of a judge overseeing an SEC case. If there was any doubt that U.S. Senior District Judge Jed Rakoff has inspired soul-searching in the nation’s federal judiciary, the utterly compelling transcript of the hearing before Block should put it to rest.

The Once in a Lifetime REO-to-Rent Opportunity Deal

  The future of Mortgage Servicing Fraud promises sunny days and increased ill-gotten profits as the criminal enterprise embraces its Foreclosures to Rent platform. Recent studies reveal over 80% of the nation's foreclosures are illegal. And everyone knows selling stolen property is also illegal - but what if we just rent all the homes we steal? 
2/15/12 House panel wants session with ex-Countrywide CEO WSJ House investigators want to interview Angelo Mozilo, the former Countrywide Financial Corp. chief executive whose VIP program gave discounted mortgages to members of Congress, other government officials and influential people who could help the company.

Citigroup to Pay $158 Million in Mortgage Fraud Settlement

Preet Bharara, the United States attorney in Manhattan, said lenders for too long viewed “insurance of their mortgages like they were playing with house money.”

NY Times Citigroup has agreed to pay $158.3 million to settle claims that its mortgage unit fraudulently misled the government into insuring risky mortgage loans for over six years.

As part of the civil fraud settlement, Citi accepted responsibility for failing to comply with government requirements and submitting certifications that were fraudulent.


Syncora Guarantee Claims Fraud by EMC Mortgage in Mortgage-Backed Securities Suit

The suit was brought in connection with a transaction known as SACO I Trust 2006-1

Bloomberg Bear Stearns made “materially false and misleading representations to induce Syncora to insure the transaction,” and didn’t conduct “extensive due diligence” as it had promised.

HUD’s Donovan Tells Remarkable Whoppers About Settlement to Mortgage Investors

If you are going to lie, it appears the Obama Administration believes there is nothing to be lost by telling a Big Lie.

naked capitalism Several items stood out. The first is that Donovan claimed that the settlement respected the creditor hierarchy, when that is a patent falsehood. He has, in other calls, described the treatment of second liens as “at least pari passu”. As we have discussed, second liens are to be written off when they are more than 180 days delinquent, but banks can pretty much arrange that that does not happen.

This is a very scary bill and it has passed through the Banking & Insurance committee.

Florida Senate - 2012 SB 1890 By Senator Latvala 16-00993A-12 

Florida Senate An act relating to mortgage foreclosure proceedings; providing a short title; specifying the public policy of this state with respect to mortgage foreclosure proceedings.
2/15/12 Deadline to Request Review Under the Independent Foreclosure Review Extended to July 31 Federal Reserve There are no costs associated with being included in the review. For more information, borrowers can call 888-952-9105, Monday through Friday, 8 a.m.-10 p.m. ET or Saturday, 8 a.m.-5 p.m. ET or visit HERE or HERE.

New York Creates New Foreclosure Courts to Clear Backlog

Also see Thomson Reuters: Chief judge announces new foreclosure court part in state of judiciary speech

A new court initiative will allow all New York homeowners facing foreclosure to obtain legal representation and streamline the process of settling mortgage disputes out of court.

naked capitalism

Thomson Reuters

The plan to be implemented in New York appears to be more fair-minded in intent than its Florida cousin. And while it appears unlikely to produce the sort of kangaroo court outcome that occurred in Florida, it is not hard to see that this initiative is likely to fall well short of its objectives.

Homebuyers Sue Banks in RICO Class Action

Bias v Wells Fargo, JPMorgan

Complaint also argues Statute of Limitations.

Courthouse News

Home Equity Theft Reporter

"In effect, to generate hearty profits, defendants have substituted inflated interest rates with inflated fees. Defendants formed enterprises - associations of subsidiaries and affiliated companies - and designed schemes to disguise hidden mark-ups, and unnecessary fees so that they could earn additional, undisclosed profits.

Corruption Trial: Foreclosure division was created as place to hire friends

"It was a phony program. They did nothing except spend money." 

Cleveland When former County Auditor Frank Russo ran out of money to hire people as favors to friends, he asked the county commissioners to pay for a new foreclosure department in his office so he'd have a place to put them.

Obama Housing Plans vs. Reality

The White House has made big promises before about helping homeowners, only to see them disappoint time and again.

ProPublica Here are the latest proposals, whether they are anything new, and whether they stand a chance of going anywhere.
2/13/12 CNBC’s Diana Olick’s Wrongheaded Analysis of the Foreclosure Fraud Settlement

It is very disheartening to learn we still have a reporter who doesn't have a clue about what is going on. 

David Dayen


We’re going to have to endure this line of argument from those savvy business reporters, and Diana Olick is at the head of the pack, so we might as well take on this argument about the foreclosure fraud settlement directly.

Lawsuit: Chase And Wells Fargo Overcharged Homeowners As Much As 300% On Mortgage Fees BusinessWeek "Loan agreements require that default-related services must be reasonable and appropriate," said attorney Roland Tellis. "Banks are not allowed to mark up the charges so they can make a profit, but that is exactly what they have done."

AMI Takes Position against Mortgage Servicing Settlement

In a strongly worded statement on behalf of the American Association of Mortgage Investors (AMI), Jonathan Lieberman, Managing Director of Angelo, Gordon & Company, criticized the recent settlement agreement over alleged mortgage servicing and foreclosure processing abuses. 

Mortgage Daily News "Current press reports tell a story of regulators imposing penalties not only on the bad actors but also on Americans' investors, pension funds, and retirees," and that "the rush to finalize a flawed and opaque settlement smells funny.

Lieberman concluded his statements by saying Association members stand ready to provide information and support to government officials and regulators and borrowers who have been abused by servicers and "stand ready to support the write down of underwater second lien mortgages."

The foreclosure fraud settlement: An amnesty for Wall Street Criminals

Last Thursday, the Obama administration announced its latest windfall for Wall Street—a settlement of charges of rampant law-breaking committed by major banks in their rush to foreclose on families and seize their homes.

wsws The agreement, largely dictated by the perpetrators, quashes investigations by state governments that threatened to expose a cesspool of corruption and crime. It frees the banks from future prosecution or financial liability for forgery, lying to the courts and illegally evicting homeowners.

What’s Inside the $25 Billion Mortgage Settlement: An Early Look WSJ The draft documents obtained by the Journal show the many moving pieces that were the product of more than one year of discussions. As indicated, the documents are draft copies that were issued on Jan. 19, just as state attorneys general were briefed on the deal. It’s not clear how much the terms have changed since these drafts were written.
2/13/12 Giving Away your Home and Equity to a Criminal Enterprise for Pennies

"They are being very mysterious and quiet about it." 

Scrippsnews Banks who do not legally own the home and cannot foreclose are stuck; so they are offering cash as an incentive to get homeowners to give up their home and equity. MSF

The Federal Reserve Board releases orders related to the previously announced monetary sanctions against five banking organizations

Federal Reserve The Federal Reserve Board on Monday released the orders related to the previously announced monetary sanctions against five banking organizations for unsafe and unsound processes and practices in residential mortgage loan servicing and processing. The Board reached an agreement in principle with these organizations for monetary sanctions totaling $766.5 million on February 9, 2012. 

Quelle Surprise! Administration and State Attorneys General Lied, Mortgage Settlement Release Described as “Broad” 

The proposed Release contains a broad release of the banks’ conduct related to mortgage loan servicing, foreclosure preparation, and mortgage loan origination services. Claims based on these areas of past conduct by the banks cannot be brought by state attorneys general or banking regulators.

naked capitalism This is sufficiently general so that it is hard to be certain, but it certainly reads as if it waives chain of title issues and liability related to the use of MERS. That seems to be confirmed by the fact made by local recorders for fees are explicitly preserved (one would not think they would need to be preserved unless they might otherwise be assumed to be waived). This is exactly the sort of release we feared would be given in a worst case scenario. The banks have gotten a huge “get out of jail free” card of bupkis.
2/13/12 CFPB outlines plans for Mortgage Servicers Washington Post The massive financial reform legislation passed in 2010 that established the CFPB also required it to take steps to retool the mortgage servicing industry. The plans outlined Monday will apply not only to servicers operated by banks but also to those run by other financial institutions that were previously not subject to federal supervision.

Bear Stearns Ex-Managers to Pay $1 Million to Settle Fraud Case

“This case is being settled for, relatively speaking, chump change,” Judge Block said at the hearing. But he said he “was inclined to sign off on it.”

NY Times In November 2009, a jury acquitted Mr. Cioffi and Mr. Tannin of criminal charges after a monthlong trial. The Securities and Exchange Commission, which had brought a parallel civil action against the two men, continued to pursue its case.


For California, Attorney General Insisted on Better Terms in Foreclosure Deal NY Times Ms. Harris wagered that holding out until the end in the settlement talks would give her the most leverage. In the end, she walked away with far more than California was slated to receive in the early days of the talks and a little more than was on the table as recently as January. Beaming into the cameras last Thursday, she said California homeowners were guaranteed $12 billion in debt reduction, while most other states received only promises.

Fannie Mae, Freddie Mac, and Federal Housing Finance Agency: Perform principal reductions for all who are at risk of foreclosure. Negative equity is the driving force for defaults. Underwater homeowners do not feel they have any buying power so they will not spend as much.

After Mortgage Settlement, Fannie Mae, Freddie Mac Face Renewed Pressure On Principal Reduction Huff Post State officials who negotiated the deal say they could not convince Fannie Mae and Freddie Mac, or the Federal Housing Finance Agency, which oversees the loan giants, to join onto the settlement because they are steadfastly opposed to principal reductions -- loan write-downs for borrowers whose homes are at risk of foreclosure.
2/13/12 CFPB Announces Draft Mortgage Monthly Statement FDL It’s a pretty comprehensive statement that explains the monthly charges, where the money goes, the outstanding principal on the loan, the maturity date, the interest rate, a breakdown of past payments and fees and contact information for the servicer as well as HUD mortgage counselors.

“A lot of the principal reductions would have happened on their loans anyway, and they’re using other people’s money to pay for a ton of this.

Bond Fund Pimco Criticizes Foreclosure Fraud Settlement 

Pimco can sue to block the foreclosure fraud settlement.

David Dayen


Banks could make out either way. If they reduce principal on a bank-owned loan, they could call it a HAMP loan and get a payment of around 63 cents on the dollar. 

If they reduce principal on an private label MBS loan, they get to pay off part of the settlement with someone else’s money. Win-win.


More trouble likely ahead for mortgage servicers

Lawsuits, criminal charges still likely fallout from crises

L.A. Times "On multiple fronts, we will continue to investigate the mortgage crisis that has impacted communities in every corner of this state, and ensure that justice and accountability prevail," Schneiderman said.

Preet Bharara, the U.S. attorney in Manhattan, said the "charges demonstrate our deep commitment to bringing these kinds of cases, notwithstanding how challenging they may be."


Mortgage settlement lets banks off the hook, again

If anyone expects this settlement to have a noticeable effect on the housing market, they will be badly disappointed. 

CNN The third and most serious issue involved foreclosures where banks could not prove that they owned the property. This may seem farfetched, but there are foreclosure cases in which the bank's servicer lacked the documentation to show that it in fact owned the property. In some of the famous cases of robo-signing, people were being paid to forge documents to substitute for ones that could not be found.
2/13/12** Foreclosure deal: The joke is on us

If you own a gun, you can rob a bank — but if you own a bank, you can rob the entire world.

Detroit News Chase itself said it made $500 million a year after taxes by rigging customer accounts with added overdrafts.

Let's do the math: Steal $500 million a year for several years, minus $110 million one-time penalty = a pretty good deal. But it doesn't equal justice.

The Obama Mortgage Settlement is Just Another BANK BAILOUT in Disguise ALLGov Up to 750,000 borrowers will be eligible for a check of $1,800 - $2,000, which is, in the words of Dayen, “the equivalent of saying to them, ‘sorry we stole your home, here’s two month’s rent.’”


Amicus Brief in Bain v. Metropolitan Mortgage Group, et al ORGANIZATION UNITED FOR REFORM
Complaint alleges because MERS was never the lawful holder or assignee of the notes, it is not the "beneficiary"?" under the Washington Deed of Trust Act and cannot initiate any foreclosures or appoint any trustee.



Re: Governor Walker Raiding Mortgage Fraud Settlement to Plug Budget Hole

NewBerlinNow “Now that they are finally getting some relief from the federal government, Scott Walker is snatching that money to finance his $2.3 billion tax giveaway to millionaires and billionaires. Walker has previously criticized such raids, characterizing them as “robbing Peter to pay Paul.” In this case, Scott Walker is robbing Peter and Paul to pay for his own radical agenda.”

REPEAT from a year ago...

Why the Foreclosure Mess Settlement Proposal Can't Fix the Damage

The settlement doesn't go nearly far enough to save the housing market. In fact, it can't go far enough, because it can't address one of the most confounding problems the banks have created: the millions of properties nationwide that now have "clouded" titles.

Abigail Field

Daily Finance

To put it plainly: Because of these bad titles, property owners can't prove they own the properties they think they bought, and banks can't prove the had the right to sell them.

Even though it's impossible to know how many properties are affected, I have confidence in saying millions nationally for the following reasons:


White paper


All over the country, courts are scrutinizing whether the parties initiating foreclosures against homeowners have the right to take this action when authority to enforce the note and mortgage is absent. Without this right, foreclosure sales can be reversed.


Property Title Trouble in Non-Judicial Foreclosure States: The Ibanez Time Bomb?

The article also provides a roadmap for others to assess the extent to which title to properties purchased at foreclosure sales or from lenders’ REO inventories might be defective in other states. Finally, I address the potential consequences of reversing foreclosure sales and responds to the securitization industry’s worry about homeowners getting free houses.

  This concern is most acute in the majority of states where foreclosures occur with little or no judicial oversight before the sale, such as Massachusetts. Due to the recent decision in U.S. Bank N.A. v. Ibanez, in which the Supreme Judicial Court voided two foreclosure sales where the foreclosing parties did not hold the mortgage, Massachusetts is the focal jurisdiction where an important conflict is unfolding.

This article explores the extent to which the Ibanez ruling may influence the jurisprudence in other non-judicial foreclosure states and the likelihood that clear title to foreclosed properties is jeopardized by the shoddy handling of notes and mortgages. I focus on Arizona, California, Georgia, and Nevada because they permit non-judicial foreclosures and they are experiencing high seriously delinquent and foreclosure rates. After comparing the law in these states to that of Massachusetts, I conclude that Ibanez will have little effect in Arizona but should be influential in the other states, to varying degrees. As a result, property title trouble is likely in Georgia and Nevada, and to a lesser extent in California. 


What Homeowners Need Now

The best way to get help to many of them is through Fannie Mae and Freddie Mac, the government-run mortgage companies, which hold roughly 30 million mortgage loans, none of which are covered in last week’s settlement.

NY Times The White House needs to challenge Republicans to explain why they are more interested in protecting the banks than protecting homeowners — and challenge them to come up with a better way to pay for the necessary relief.

Too much time has already been wasted. Foreclosures will not be stanched and house prices will not stabilize without more help.

  Is $25 billion mortgage settlement large enough?  MSNBC Up w/Chris Hayes interview with Delaware AG Beau Biden and others regarding the weak settlement.
2/11/12 Too Many Unanswered Questions, and Too Little Relief

What do banks get in exchange for the relief? The answer, in short, is a sweet deal.

NY Times Which brings us back to the question of whether a new investigation will indeed get off the ground. We are skeptical. The Obama administration squandered several months resisting Mr. Schneiderman’s insistence on a broader investigation, raising questions about its willingness to now get tough with the banks and bankers. As a practical matter, that delay has allowed some potential violations to draw closer to expiration under statutes of limitation.

The Deal Is Done, but Hold the Applause

There’s no doubt that the banks are happy with this deal. You would be, too, if your bill for lying to courts and end-running the law came to less than $2,000 per loan file. (versus prison time)

Gretchen Morgenson

NY Times

Additional details will emerge. But this kind of minutiae will determine whether the settlement succeeds. So many borrower programs have failed since the foreclosure crisis began. Another nonstarter will only add to the mistrust that many people harbor toward those large institutions, both public and private, that contributed so mightily to this mess.
2/11/12 Watch out for Bill Collector Tricks

Use Of Arrest Warrants By Bill Collectors To Squeeze Consumers For Cash Probed By Some Lawmakers, Government Regulators

Suit: Bill Collector For 'America's Stagecoach To Hell' Falsely Reports Suicide Threat By 85-Year Old Debtor; Leads To 'Forced Trip' To Emergency Room

Home Equity Theft Reporter Some lawmakers and regulators are probing the use of arrest warrants by the U.S. debt collection industry to recover money owed by borrowers behind on loans, credit card payments, and other bills.

When Anne Sessions, 85, of Lane County, Ore., fell behind in her credit card payments, she said an aggressive debt collector harassed her to the point of calling the police with a phony claim she threatened to commit suicide, costing her $1,055 in medical bills. Now she is suing for $250,000 over the incident, which led to an involuntary hospital visit.


Mortgage Settlement as Attorney General Sellout: Deal is Not Done, and Final Version Guaranteed to be Worse Than Advertised

American Banker confirmed that the settlement pact is far from done, and the details will be kept from the public as long as possible, until it is filed in Federal court. 

naked capitalism …a fully authorized, legally binding deal has not been inked yet….A representative for the North Carolina attorney general downplayed the significance of the document’s non-final status, saying that the terms were already fixed…

Banks Not Off Hook With $25B Mortgage Agreement

The $25 billion deal with the five biggest servicers ends state and federal probes into shoddy foreclosures and pays for debt forgiveness, refinancing and other efforts to keep struggling homeowners in their properties.

Bloomberg U.S. lenders including Bank of America Corp. still face years of litigation and billions of dollars in liabilities tied to the housing collapse after agreeing to settle a probe of abusive foreclosure practices.
Government officials can pursue claims related to the packaging of loans into securities, criminal-enforcement actions and fair-lending violations

Masto: Settlement just one part of Nevada mortgage fix

“This is one piece of a broader focus for my office,” Masto said, adding her staff is involved in several lawsuits and civil and criminal investigations targeting mortgage fraud and foreclosure abuses.

Vegas Inc. “Because the private right of action is retained, we’re going to seek proposals from Legal Aid to see if this money would benefit them in aiding the homeowner,” Masto said. “There’s also a self-help center in the Regional Justice Center. We’re going to see if any of this money would be feasible to help individuals who want to go into that center to understand their rights and what forms they would need.”

Barrett, others rip plan to use "most" of mortgage settlement for budget!!!

Wisconsin plans to use about $26 million of its $140 million share of a national mortgage settlement to help plug the state's budget hole — a move Milwaukee Mayor Tom Barrett on Friday called "unconscionable."

Wisconsin State Journal Attorney General J.B. Van Hollen's office made the decision in consultation with Gov. Scott Walker to use most of the $31.6 million paid directly to the state to balance the budget rather than to help the thousands of Wisconsin residents who have lost their homes to fraudulent mortgage practices.

They Still Don’t Get It — Robo-crimes are not victimless!

No property transaction can be accepted based upon falsified, forged, fraudulent documents — so it does mean that there cannot be a foreclosure unless true documents reciting true facts are used in a foreclosure.

Without further investigation and discovery how does anyone know that Robo-signing was not as mean-spirited and pernicious as it sounds when put into solid language — the forged signing of fraudulent documents containing false declarations meant to deceive the reader, the public and the recording offices?

Neil Garfield

Living Lies

Start with the amount of money that is claimed as defaulted from 2006 to the present and apply payments received from all parties, not just the borrower. And remember that if the payment came from the taxpayers, it came from the borrower who pays taxes just like everyone else. If the money came from insurers or counter parties to credit default swaps, and the creditors (investors who advanced the money) are satisfied, why should the borrower pay it again? — especially to banks that were never more than conduits, never had any loss, never funded the loan and never purchased the loan.

On the Mortgage Settlement: There Is No Political Solution to a Math Problem

In terms of an investigation, the Savings and Loan crisis used roughly 1000 FBI investigators to uncover fraud -- this task force taking on a crisis forty times more severe will employ 10 FBI agents.

Dylan Ratigan


Eliot Spitzer

The proposals on the table to solve this problem aren't inspiring. The meager mortgage settlement deal cut via furious and dramatic negotiations is unlikely to be meaningful. This settlement is essentially a continuation of previous alphabet soup housing programs, because it would not force banks to fundamentally restructure the trillion dollar underwater mortgage problem.

Bachus Under Investigation For Insider Trading - What About Nancy?

One can’t help but wonder how Nancy Pelosi escaped a similar ethics investigation?

Zero Hedge The Office of Congressional Ethics is investigating the chairman of the House Financial Services Committee over possible violations of insider-trading laws, according to individuals familiar with the case.

Rep. Spencer Bachus (R-Ala.), who holds one of the most influential positions in the House, has been a frequent trader on Capitol Hill, buying stock options while overseeing the nation’s banking and financial services industries.

Critics call foreclosure settlement ‘a slap in the face’

“It’s a slap in the face,” said North Las Vegas resident Nina Griffin, who says her home faces a wrongful foreclosure involving Bank of America subsidiary Countrywide.

Las Vegas Sun Nevertheless, government officials who announced the settlements on Thursday made the point that the deals they made with the banks were likely the best they could accomplish given the costs and risks of litigating against them in court.

That litigation 'threat' was part of the banksters' business model.


Florida Homeowners Find Little to Cheer in Deal With ‘Gangsters’

“These are fraudulent bankers and Wall Street gangsters who have to pay for what they’ve done.”

BusinessWeek While pro-bankster Bondi described the deal yesterday as a historic win, interviews around the Sunshine State revealed anger among homeowners stuck in foreclosure cases that last longer than in any other state, and skepticism from real-estate professionals leery of banks’ promises.

For America's hard-hit homeowners, little relief from settlement Reuters "I don't think it's going to have a lot of meaning for consumers," she says. The $25 billion settlement "is a miniscule amount of money and doesn't begin to approach the banks' legal liability for the fraud."

ProPublica's On-going Investigation

Foreclosure Crisis

Banks and Government Fail Homeowners

ProPublica Related articles in this series:

Will Mortgage Settlement Avoid Repeating Obama’s Foreclosure Failures?

Why Millions Won’t Get Help From Big Mortgage Settlement


JPMorgan Chase Charged with Faking Documents in Bankruptcy Cases

JD Supra A federal class action lawsuit alleging massive and systemic fraud on the part of JPMorgan Chase has the potential to send the entire nation’s bankruptcy system into a tailspin, according to legal experts.

Another State Government Looting Settlement Funds

The rest of the Texas settlement slice, $141 million, is considered a civil penalty that will go into the state's treasury, which the Legislature will be able to spend later.

My SA Another failed settlement deal where the majority of funds do not go to the victims and little relief to the remaining pool. Over 25% goes to the State to whatever they want with it. Once again, the crooked courts and law enforcement who participated in the illegal foreclosures are left untouched.


Judges Rule Against MERS Attempt to Move Dallas Lawsuit National Mortgage News MERS argued the claims in the Dallas County case are common with the other MDL cases and meet the panel’s requirements that consolidation would promote the convenience and “just and efficient conduct of the action.” But the judicial panel ruled there are important distinctions between the MDL and Dallas County cases.


After mortgage settlement, MERS left out in the cold
This story is significant because when push comes to shove, the banks will turn their backs on MERS.
Thomson-Reuters That's significant because of a potentially multi-billion-dollar theory posited in MERS suits by the Massachusetts and Delaware AGs, as well as in a class action Bernstein Leibhard filed on behalf of Ohio county governments.

Multi-State Settlement Does NOT Bar Your Individual Claims or Defenses

Over the next several months homeowners in trouble will receive letter or notification of this agreement deal. I highly recommend DO NOT SIGN IT or accept it, if you plan to file lawsuit against your mortgage servicer.


Living Lies

And with all the fraud, you can win. Robo-signing perjury, missing assignments, no ownership of note, quiet title action, etc. 

You can still file lawsuit for this fraud even with Obama's agreement in place - as long as you do not accept the agreement plan.


New York AG Eric Schneiderman talks mortgage investigations with Rachel Maddow MSNBC 

Rachel Maddow Show

New York Attorney General Eric Schneiderman told Rachel Maddow that this is just a "down payment" and vowed to keep fighting.

As co-chair of the new federal investigation of Wall Street, he promised that "the big payday is still to come" and "every possible criminal case is still on the table."

Foreclosure Deal to Spur New Wave of U.S. Home Seizures, Help Heal Market Bloomberg Lenders slowed the pace of foreclosures as they negotiated with attorneys general in all 50 states for more than a year over allegations of faulty and fraudulent paperwork used to repossess homes. With yesterday’s agreement, banks are likely to resume property seizures.

Cleveland covets mortgage settlement money for demolition of abandoned homes Cleveland Attorney General Mike DeWine will distribute $75 million for eliminating blight. DeWine, who will be in Cleveland for a news conference today, has yet not decided how to divide the money in a state with an estimated 100,000 abandoned houses
2/9/12 BEWARE!

Short sales can mean bonuses for some homeowners

Some speculate that the offers occur when banks misplace essential paperwork and can't defend a legal challenge to a foreclosure. 

SFGate "My belief is that banks cannot produce a deed of trust or a note" when they offer the incentives, Rhodes said.

"Anyone who enters this arena thinking they will get a particular outcome (should realize) there is high uncertainty. The dominant path is still the foreclosure path; enter at your own peril."


Will Government Bank Mortgage Deal Help or Hinder Prosecutions?

Yves Smith: How can Obama Admin. settle before they have fully investigated the fraud?

The Real News interview before the settlement was announced "It looks a little bit peculiar, because if you were serious about investigating, you wouldn't be settling. I mean, one of the basic rules of prosecution is that you investigate first, you see what the cases might look like, and then you have at least a rough idea of what you might sue on, or you even file a lawsuit; then you negotiate a settlement. That's the normal procedure." - Yves Smith
Press release


Bank of America Subsidiary Reversing or Refunding $36 Million in Fees to Resolve FTC Allegations That it Overcharged Struggling Homeowners

Excessive Default-Related Fees Allegedly Violated Earlier Countrywide Settlement

Federal Trade Commission Bank of America subsidiary BAC Home Loans Servicing, LP has already reversed or refunded $28 million worth of improper fees for title and other default-related services charged to homeowners behind on their mortgages. The new settlement requires BAC Home Loans to reverse or refund the remaining $8 million in improper fees.

Push to Avert Foreclosures Hits Court Logjam  created by bank trickery

The state’s judges have grown increasingly vocal about what some of them have called “outrageous” conduct, “patently false” statements and “inexcusable” actions by lenders’ lawyers.

NY Times New York has been among the most aggressive states in trying to protect homeowners from foreclosure, granting new legal protections and turning courts across the state into teeming negotiation centers working to keep people in their homes.



$25B settlement reached over foreclosure abuses

A landmark $25 billion settlement with the nation's top mortgage lenders was hailed by government officials Thursday as long-overdue relief for victims of foreclosure abuses. But consumer advocates countered that far too few people will benefit.

Settlement Release, Graphic and Amounts

AP Iowa Attorney General Tom Miller, who led the 50-state talks, said the $2,000 represents the homeowners' best hope of getting reimbursed. They would have had trouble winning settlements in court because of the time-consuming complexity of litigation, Miller said.

"Two thousand dollars won't cover my moving costs," said Brian Duncan, who was evicted from his Tempe, Ariz., home last April.



Feds, States, Banks Agree To $25 Billion Mortgage Fraud Settlement

Servicers will receive only partial credit for every dollar spent on some of the required activities

Brevard Times Mortgage servicers are required to fulfill these obligations within three years. To encourage servicers to provide relief quickly, there are INCENTIVES for relief provided within the first 12 months. Servicers must reach 75 percent of their targets within the first two years. Servicers that miss settlement targets and deadlines will be required to pay substantial additional cash amounts.



States Negotiate $26 Billion Agreement for Homeowners NY Times In the agreement’s expected final form, the releases are mostly limited to the foreclosure process, like the eviction of homeowners after only a cursory examination of documents, a practice known as robo-signing.

The prosecutors and regulators still have the right to investigate other elements that contributed to the housing bubble, like the assembly of risky mortgages into securities that were sold to investors and later soured, as well as insurance and tax fraud.


Foreclosure Settlement Falls Short, Still Worth the Wait: View

The settlement also reverses the banks’ incentives to foreclose on families rather than keep them in their homes with loan forgiveness. Until now, banks had been loath to reduce principal amounts because it meant recognizing losses on their balance sheets. 

Bloomberg In any out-of-court settlement for alleged wrongdoing, the test of whether prosecutors got a good deal rests on the answers to three questions: Does it hold the miscreants accountable? Does it make victims whole? And does it prevent similar misconduct in the future?
2/9/12 Understanding the New Mortgage Foreclosure Settlement

The deal also ensures that the banks primarily responsible for the lending abuses and fraud that were core causes of the housing bubble aren’t allowed off the hook

Center for American Progress State attorneys general will now be able to focus their attention on investigating and prosecuting violations that helped cause and exacerbate the housing crisis, as the settlement itself is limited to claims revolving around the so-called “robo-signing” abuses that occurred during foreclosure processing.
2/9/12 The Servicing Settlement: Banks 1, Public 0 Prof. Adam Levitin What are we to make of the servicing settlement announced today with much hoopla? The short answer is not much. The settlement is the large consumer fraud settlement ever, but it accomplishes remarkably little in terms of either alleviating the foreclosure crisis of holding to account those responsible for the housing bubble and subsequent foreclosure abuses. As my Texas relatives say, it's “All sizzle, no steak.” 
2/9/12 Bankruptcy Implications of AG Settlement

I am already concerned about how the settlement will affect bankruptcy cases. 

Prof. Katie Porter As of December 1, new Bankruptcy Rules of Procedure 3001 and 3002 impose new requirements on servicers of loans owed by bankruptcy debtors. Are the terms of the settlement consistent with those new rules? If so, do they add any new procedural benefits to protect bankrupt homeowners against robo-signing and legal violations?
2/9/12** 'Mortgage Deal from Hell' Hurts Responsible Borrowers: CNBC Homeowners who kept up on their payments would lose while those who fell behind would win under an apparent deal between big banks and state governments, banking analyst Dick Bove said.
2/9/12 Why Millions Won’t Get Help From Big Mortgage Settlement

Many won't qualify -- thanks to government-owned Fannie Mae and Freddie Mac.

Even if Bank of America, for example, services your mortgage, you would not be eligible for principal reduction if Freddie or Fannie back it.

ProPublica The two mortgage companies, who were bailed out by the government in 2008, were described by former Obama economic advisor Jared Bernstein as "the boulder" in the way of principal reduction. Their federal regulator, the Federal Housing Finance Agency, is tasked with maximizing profits from the companies -- and thus minimizing taxpayer losses. The head of the agency, Edward DeMarco, argues that allowing principal reductions would result in a big loss for Fannie and Freddie and ultimately taxpayers.
2/9/12 The banks have won, homeowners are re-victimized. FDL On top of everything else, nobody seems to think it’s going to be helpful to the recovery of the housing market, help the economy, or do anything except bail out the banks, again. 
2/9/12 Why the Foreclosure Deal May Not Be So Hot After All

The message this sends is that if you commit crimes on a large enough scale, and have enough high-priced legal talent sitting at the negotiating table after you get caught, the government will ultimately back down, conceding the inferiority of its resources.

Matt Taibbi

Rolling Stone

It feels an awful lot like what happened here is the nation's criminal justice honchos collectively realized that a thorough investigation of the problem would require resources they simply do not have, or are reluctant to deploy, and decided to accept a superficially face-saving peace offer rather than fight it out.
2/9/12 Robo-Deal: The Price of Crime

If you steal a little money you go to jail. If you steal a lot you get to keep it. 

That seems to be the net impact of the multi-state settlement. Yves Smith (see below) and Adam Levitin are among many who decry this settlement and I agree with their reasons, but I don’t agree that this is the end of this “theater.”

Neil Garfield

Living Lies

Those foreclosures cannot continue without continuing the fraud. This isn’t a paperwork problem — it is an economic one in which the real parties in interest have been left out.

Thus any document signed by these strangers to the transaction is no more than a Wild Deed that cannot support a chain of title. If this issue is not addressed head-on, who is going to buy anything or lend anything in a market where a growing number of supposedly ex-homeowners successfully overturn foreclosures and regain title and possession of their properties? It isn’t the number of people who succeed in this endeavor that matters — it is that the risk exists that it could happen on any property.

2/9/12 The Top Twelve Reasons Why You Should Hate the Mortgage Settlement  

Here are the top twelve reasons why this deal stinks:

1. We’ve now set a price for forgeries and fabricating documents. It’s $2000 per loan. This is a rounding error compared to the chain of title problem these systematic practices were designed to circumvent. The cost is also trivial in comparison to the average loan, which is roughly $180k, so the settlement represents about 1% of loan balances. 

You may also want to watch:   Will Government Bank Mortgage Deal Help or Hinder Prosecutions?

naked capitalism 2.  That $26 billion is actually $5 billion of bank money and the rest is your money. The mortgage principal writedowns are guaranteed to come almost entirely from securitized loans, which means from investors, which in turn means taxpayers via Fannie and Freddie, pension funds, insurers, and 401 (k)s. Refis of performing loans also reduce income to those very same investors. 

3. That $5 billion divided among the big banks wouldn’t even represent a significant quarterly hit. Freddie and Fannie putbacks to the major banks have been running at that level each quarter.

2/9/12 The Nationwide Mortgage Settlement Protects Banks From Some Litigation, But Here's Where They're Still Exposed Business Insider From Attorney General Schneiderman's office (whose task force, as President Obama just said, still has all of its power) — here's a list of legal claims regarding mortgage fraud that can still be made against banks:
2/9/12 New Yorkers With Troubled Mortgage Would Benefit From Settlement Deal WGRC New York is expected to receive nearly $790 million in the sweeping federal mortgage settlement announced today, including $495 million for loan modifications and $136 million in direct payment to the state, Attorney General Eric Schneiderman said.

Illinois attorney general's office offers homeowner help line after mortgage settlement

Illinois is expected to get $1 billion

The Republic Madigan's office says the money will be used to help Illinoisans who've lost homes, are at risk of defaulting on their mortgages or owe more than their homes are worth. The settlement also will overhaul standards to prevent abuses.
2/9/12 OCC Settles Servicing Claims for a Paltry $394 Million (Actually $0 Million) David Dayen


I don’t even think you could find officials in the federal government outside the OCC to tell you that their consent orders represented anything but a whitewash. But they cleverly hid them behind the bigger settlement today in the hopes that nobody would notice.
2/9/12 BofA Said to Be in Talks With Arizona for Foreclosure Agreement Bloomberg A settlement would clear the way for the state to join a proposed nationwide agreement with banks over foreclosure practices. Arizona is among a group of states that have yet to sign on to the deal, said the person, who didn't want to be identified because the matter wasn't public.

HUD Agreement Resolves the United States' Civil Claims that Bank of America, Through its Countrywide Financial Subsidiaries, Defrauded the Federal Housing Administration by Recklessly and Fraudulently Underwriting Loans to Unqualified Borrowers
2/8/12 Why Wall Street Should Stop Whining

Banks have unfortunately had to give up the practice of simply printing trillions of dollars out of thin air by selling off worthless mortgages for huge profits and/or making millions of synthetic copies of those same worthless mortgage assets.

Matt Taibbi

Rolling Stone

The unbelievable tone-deafness of people who would complain out loud, during a time when millions of people around the country are literally losing their homes, that their bonuses – not their total compensation, mind you, but just their cash bonuses, paid in addition to their salaries and their stock packages – are barely enough to cover the mortgage payments for their new condos, the taxis they take when walking is too burdensome, and their girlfriends with expensive tastes.

Millions missing: Investigation widens into NM Title Co. The Daily Times Several million dollars appear to be missing from title and escrow accounts at New Mexico Title Co., a police detective said Tuesday, as the investigation widens into possible wrongdoing at the Farmington business.
2/8/12 49-State Foreclosure Fraud Settlement Will Be Finalized Thursday

I’ve done the math on this before, and you’re talking about $20,000 (when homes are on average underwater $50,000) for 1 million borrowers (when there are 11 million underwater).

David Dayen


The deal will release claims from state Attorneys General, but individual homeowners retain private rights of action to sue over foreclosure fraud and other abuses. As part of the settlement, states will get a fixed amount in hard dollars that would go to fund legal aid services. “This will get a lawyer for everyone facing foreclosure in the state,” said one source in an Attorney General’s office. “This will stop every wrongful foreclosure.”

Coakley not ready to say settlement with banks is best choice Jenifer McKim

Boston Globe

Coakley says she doubts any agreement will offer adequate help to struggling borrowers here. Coakley also wants to address problems related to lenders who seized homes without having the proper documentation.


El Paso Woman May be Victim of Illegal Robosigning

Like countless others, she's Facing Foreclosure Even Though She's Made all Her Payments

Newschannel 9 Roman said the foreclosure process is contaminated, when different people sign the same name, or when the bank uses a rubber stamp.

"How do we know or how can they prove that the person that is saying 'go foreclose on a property' has the authority to do that?” asked Roman.

Newschannel 9 reached out to several banks about robosigning; they wouldn't comment. The big question now is, what can local leaders do to help homeowners who fall victim to this illegal practice?
2/7/12 Price of Signature of Homeowners Rises to Avoid “Title Crash”

Without solving it, title insurers, banks, servicers, and other parties could be liable or indicted for stealing millions of homes.

See an attorney who is knowledgeable in real estate transactions before you agree to sign anything and bargain hard for your rights and compensation.

Many lawyers are still saying the old “you owe the money, you have no rights” mantra. This could be the basis for a malpractice suit later when the client realizes that he did have rights and he lost them as a result of the attorney’s bad advice.

Neil Garfield

Living Lies

The fact is that all the foreclosed homeowners who were the victims of wrongful foreclosures are most probably still the legal owner of the property that was “foreclosed” and “sold” to “creditors” at a false “auction” claiming false credentials. There is only one way to be sure that the title chain can be fixed — get the signature of the homeowner(s) who were involved in the title chain. But the banks and Servicers know that if they simply come right out and ask for the signature they will be met with a negative answer and a barrage of lawsuits which now bear substantial likelihood of success.


INDICTED! LPS Robosigning is Forgery and False Declaration in Missouri Neil Garfield

Living Lies

What is proper remedy for those who were illegally foreclosed? 

Under Property Law it could be return of the house. Under Contract Law it would be monetary damages, and if so, how much is enough to compensate such people? Under tort law, it could be both return of the house (constructive or resulting trust) plus monetary damages, plus punitive, treble, or exemplary damages.



Forgery – Class C Felony

Company Faces Forgery Charges in Missouri Foreclosures

Indictment of DocX (pdf)

Missouri Attorney General's Announcement (pdf)

Indictment of Lorraine O. Brown(pdf)

NY Times “The grand jury indictment alleges that mass-produced fraudulent signatures on notarized real estate documents constitutes forgery,” Mr. Koster said in a statement. “Today’s indictment reflects our firm conviction that when you sign your name to a legal document, it matters.”

Ms. Brown could face up to seven years in prison for each forgery count. DocX could be fined up to $10,000 for each forgery conviction.


Loan Repurchase Litigation Arising from Flawed Appraisals

The issue of loan repurchase obligations has gained importance because many mortgages have been bundled into mortgage-backed securities pools and sold off to investors.

The Legal Intelligencer If a loan goes bad, the investors will look to the originator or seller of the loan to be made whole. In connection with the recent subprime mortgage crisis, an FDIC study revealed that as many as 75 percent of all mortgages sold to Fannie Mae or Freddie Mac were based on flawed real estate appraisals. Under most loan purchase agreements, banks and other primary lenders are required to repurchase, indemnify or "make whole" Fannie Mae for any loan based upon faulty appraisal data (as well as upon other significant misrepresentations made by the borrower). This is true even if the bank did not know the appraisal was based on flawed data.

JPMorgan Chase May Foreclose On Civil Rights-Era Activist During Campaign To 'Fulfill' MLK's 'Vision' Huff Post Other civil rights activists have already joined the more than 35,000 people that signed on to the petition asking the bank to accept an offer to purchase Bailey's home from an alternate buyer. The uproar comes as the bank is featuring a page on its website touting its commitment to "do our part to uphold Dr. King's vision."
2/7/12 BofA Said to Put Off Refinancing Clients Bloomberg Bank of America Corp., facing increased demand for mortgage refinancing amid government efforts to help struggling homeowners, is telling some customers to wait 90 days.
2/7/12 Banks Want to Scotch Lawsuits in Foreclosure Fraud Settlement David Dayen


What it looks like to me is that the state and federal regulators negotiating the deal gave Schneiderman the go-ahead to file his suit against MERS and three banks. Then the banks found out about it and went nuts. So they’re trying to extinguish that lawsuit, which given the PR nightmare that would entail for Schneiderman, seems impossible at this point.

Far From Wall Street, Banks Are Being Punished For Misdeeds Huff Post A former bank president faces 15 years behind bars after being found criminally responsible for fraud that "contributed to the financial crisis." One of the world's most-admired banks is accused of forcing California state pension funds to cover its $95 million in losses on mortgage-backed securities. And a large bank's failed foray into complex investments went undetected for too long and doubled the Federal Deposit Insurance Corporation's holdings of such risky assets.
2/7/12 Time for New Leadership at Fannie and Freddie: Obama Should Side With Homeowners Over Wall Street Gordon Whitman

Director of Policy, PICO National Network

Wall Street executives have fought against principal reduction because it would reveal the true weakness of their institutions. 
2/7/12 National Mortgage Settlement Doesn't Protect Against Future Fraud Charges, Banks Fear Huff Post Executives at some of the nation's largest banks could be slowing down the national settlement over allegations of widespread mortgage fraud, concerned that the deal won't offer sufficient cover from new fraud charges.

Ohio's Fifth District Court of Appeals Affirms BAC Dismissal with Prejudice   Appellant’s failure to appear at trial cannot be circumvented by now claiming unjust enrichment.
Appellant’s own actions lead to the trial court’s dismissal of the complaint with prejudice, and Appellant was the architect of that outcome.

Professor Bill Black on Financial Fraud Investigations

The major development this past week is that New York Attorney General Schneiderman filed suit, alleging that the Mortgage Electronic Registration System (MERS) is aiding foreclosure fraud and ruining America’s public recordation system for real estate, which conservative economists praised as one of the key reasons America became so prosperous. MERS is enormous and it is fundamentally flawed and dangerous, so this could be a tremendously useful action.

Bill Moyers The leaks about the proposed deal occurred in conjunction with President Obama’s State of the Union Address and a series of press releases and conferences by Attorney General Holder about a newly created “working group.” That working group is intended to investigate secondary market fraud. There is no comprehensive investigation of the over $1 trillion in mortgage origination fraud. There are no prosecutions of any of the elite bank officers who led, and became wealthy from, the epidemic of mortgage origination fraud. The State AGs do not have the resources to investigate even two of the largest fraudulent lenders.
2/6/12 The Failure to Prosecute Bank Crimes Creates a Disease at the Heart of Our Politics

No financial penalty will do as much to prevent future conduct of this type as a senior executive being sent to jail. And the failure of having accountability on that level is like a festering wound at the heart of our politics.

FDL When we talk about this settlement, we’re talking about waving away pervasive conduct over a decade if not more, which has made a mockery of state courts, allowed banks to avoid billions in recording fees and compromised the land titling system in America for private property, something that economist Hernando de Soto believes is the fundamental building block of civilization and the basis for the rule of law. If you give a pass on that, even as we move to a next stage and try to preserve claims and investigations for later, you are allowing these compromises and breakdowns to occur without making those responsible to suffer much at all.

Is the Robo-Mortgage Scandal the Back-End of Tax Evasion and Fraud?

Unfortunately, as this settlement approaches, new and grave questions have emerged. These questions raise the possibility that the government may be turning a blind eye to tax evasion and fraud.

Huff Post The possibility that the scandal was the back-end of activities that appear to represent tax evasion, the failure to comply with basic rules in securitizing mortgages, and massive fraud on the purchasers of the securitized mortgage bonds.
2/6/12 US mortgage settlement talks face setbacks, again Reuters Schneiderman said Jan. 27 that the liability releases in the draft settlement had become narrow enough so that a full investigation by a new mortgage crisis unit that he will help lead could move forward.


DocX Faces Forgery Charges in Mo. Foreclosures

One of the largest companies that provided home foreclosure services to lenders across the nation, DocX, has been indicted on forgery charges by a Missouri grand jury — one of the few criminal actions to follow reports of widespread improprieties against homeowners.

Gretchen Morgenson

NY Times

A grand jury in Boone County, Mo., handed up an indictment Friday accusing DocX of 136 counts of forgery in the preparation of documents used to evict financially strained borrowers from their homes. Lorraine O. Brown, the company’s founder and former president, was indicted on the same charges.

If convicted, Ms. Brown could face up to seven years in prison for each forgery count. DocX could be fined up to $10,000 for each forgery conviction.


David Carter Found Dead In Foreclosed Home As Many As Four Years After Suicide Huff Post It appears that Carter committed suicide. He was found with a bullet wound through his head and a handgun on his chest the day that he would have turned 45 years old.
No, the Latest Bailed-Out Bank Giveaway Won’t Help Housing

It’s incredibly important that you–voters–understand that you are being lied to right now by your Federal Government and Team Obama.

Abigail Field Today a still secret deal will be announced and signed by the Bailed-Out Banks (B.O.B.s), our Federal Government, and an unknown but probably tragically high number of states attorneys general. You’ll hear this deal called a “Robo-signing settlement”, though it’s impossible to see how it can end the fraudulent manufacture of evidence by creditors in foreclosure cases. 


U.S. Home Foreclosures and Shadow Banking: Why All the "Robo-signing"?

We could be looking at another banking collapse at any time; and to fix the problem, we first need to know what is going on. The AGs should not agree to drop the curtain on the robo-signing scandal until all the evidence is on the table. It is not just a matter of punishing the guilty; it is a matter of a banking scheme based on fraud, one that ultimately does not work and has jeopardized the homes, savings and investments of the public not just recently but for hundreds of years.

Ellen Brown That is where the robo-signing came in. Foreclosure defense attorneys armed with the tools of discovery have discovered that robo-signing -- involving falsified signatures assigning mortgages back to the trusts allegedly owning them -- occurred not just occasionally or randomly but in virtually every case.

Why? Because the mortgages had to be left free to be bought and sold on a daily basis in the money market by investors. The investors are not interested in making 30 year loans. They want something short-term with immediate rights of withdrawal like a deposit account.

2/5/12 Deal Is Closer for a U.S. Plan on Mortgage Relief    
2/5/12 Schneiderman MERS Suit and HUD’s Donovan Remarks Confirm That Mortgage “Settlement” is a Stealth Bank Bailout

Let me stress: this is a huge bailout for the banks. The settlement amounts to a transfer from retirement accounts (pension funds, 401 (k)s) and insurers to the banks. And without this subsidy, the biggest banks would be in serious trouble.

nakedcapitalism Giving the banks permission to modify loans they don’t own guarantees that that is where the overwhelming majority of mortgage modifications will take place, ex those the banks would have done anyhow on their own loans. And the design of the program, that securitized loans will be given only half the credit towards the total, versus 100% for loans the banks own, merely assures that even more damage will be done to investors to pay for the servicers’ misdeeds.

Disbarred lawyer spared possible 30-year prison term, if he repays victims. Home Equity Theft Reporter Imperato withheld sentencing on one of eight charges of grand theft and warned Lindor that she would send him to prison for 13 to 30 years if he does not make good on his promise to repay the Passleys.

Why State Attorneys General Shouldn't Settle on Robo-Signing Ellen Brown 

Web of Debt

Harris and the other AGs should not sign until a thorough investigation has been conducted. The evidence to date suggests that “robo-signing” was not a mere technical default or sloppy business practice but was part and parcel of a much larger fraud, the fraud that brought down the whole economy in 2008.

A Wipeout That Didn’t Have to Happen

BOBBY L. HAYES, an engineering entrepreneur in Incline Village, Nev., used to trust financial institutions. This is the story of why he no longer does.

Gretchen Morgenson

NY Times

As the subprime disaster spread in 2007 and 2008, one trader said he mismarked the bonds to please his superiors; another said the fraud was intended to keep him in line for a rich bonus. The bank itself was not charged.


Attorney Wins “Free House” in Case Before 9th Circuit Court of Appeals  Mandelman Matters


Nathan sets it up in the beginning, then you hear the audio of the actual courtroom arguments, both his and the lawyer for US Bank… and then he and I argue various topics such as whether robo-signing should be prosecuted and by whom, along with several other things that I know are frustrating homeowners today.


A Mortgage Tornado Warning, Unheeded

YEARS before the housing bust — before all those home loans turned sour and millions of Americans faced foreclosure — a wealthy businessman in Florida set out to blow the whistle on the mortgage game.

In hindsight, what he found looks like a blueprint of today’s foreclosure crisis.

Gretchen Morgenson

NY Times

“Any attorney general, lawyer, bank director, judge, regulator or member of Congress who does not open their eyes to the abuse, ask pertinent questions and allow proper investigation and discovery,” he said, “is only assisting in the concealment of what may be the fraud of our lifetime.


2/3/12 Fannie Mae offers examples of routine dishonesty in its fight against lenders Legal Newsline Conservators of Federal National Mortgage Association wrote that in a random review of 996 loans that UBS Securities packaged, 78 percent were not underwritten in accordance with applicable guidelines.

They also wrote that a review of 363 defaults revealed that 99 percent were not underwritten according to guidelines.



Complaint Charges Use Of MERS By Bank Of America, J.P. Morgan Chase, And Wells Fargo Resulted In Fraudulent Foreclosure Filings 

Additional defendants include BAC Home Loans Servicing, LP, Chase Home Finance LLC, EMC Mortgage Corporation, and Wells Fargo Home Mortgage, Inc.

NY Attorney General The lawsuit asserts that employees and agents of Bank of America, J.P. Morgan Chase, and Wells Fargo, acting as "MERS certifying officers," have repeatedly submitted court documents containing false and misleading information that made it appear that the foreclosing party had the authority to bring a case when in fact it may not have.

Schneiderman: MERS And Servicers Engaged In Deceptive and Fraudulent Practices That Harmed Homeowners And Undermined Judicial Foreclosure Process.
2/3/12 New York sues banks over

 foreclosures Suit alleges rules violations

Click2Houston Schneiderman says that the banks created the electronic registry as an "end-run" around the public property recording system to help them more quickly buy and sell parts of mortgages. He said the system helped banks create "deceptive and fraudulent court submissions" and improperly foreclose on homeowners.
2/3/12 Pam Bondi Pretends She Did Everything She Could in Foreclosure Fraud Investigations

Bondi says her hands are tied and she can probably not investigate foreclosure fraud anymore.

FDL Bondi undertook an investigation into and sought subpoenas on David J. Stern, a notorious foreclosure mill. But she did it under the Florida Deceptive and Unfair Trade Practices Act. There were other avenues available to her. But this is what Bondi went with. And a state Court of Appeals ruled that Bondi had no authority to investigate David J. Stern under that statute.


Class Action Against Goldman Can Proceed, Judge Rules NY Times A federal judge has ordered Goldman Sachs to face a securities class-action lawsuit accusing it of defrauding investors about a 2006 offering of securities backed by risky mortgage loans from a now-defunct lender.
2/3/12 Robo-Mortgages Could Be Just The Beginning Of A Much Bigger Scandal In The Mortgage Industry

If we are a nation where justice is blind, should we not investigate this possibility before we give the offending financial institutions another free pass?

Business Insider The essence of an effective capitalist system is rules and accountability. For markets, and our larger economy to work, important players cannot be permitted to make up their own rules. In all likelihood, a settlement next week means these serious questions will never be answered.

Lori Macakanja, Housing Counselor Who Stole From Underwater Homeowners, Gets Jail Time

It is just as easy to convict banksters, judges and lawyers for their willful theft of homes and equity from homeowners.

Huff Post A New York woman whose job was to help underwater homeowners in Buffalo avoid foreclosure stole $300,000 from them and gambled it away at casinos.



John P. Hunt 

Richard Stanton 

Nancy Wallace 
Mortgage Electronic Registration Systems, Inc. (“MERS, Inc.”) owns legal title to some 30 million mortgages in the United States. The company, which was a key part of the mortgage securitization apparatus in the late 1990s and 2000s, is now under intense pressure from public and private lawsuits and investigations and faces a very real threat of insolvency. 
2/3/12 S.E.C. Is Avoiding Tough Sanctions for Large Banks NY Times “It’s really hard to see why the S.E.C. isn’t using all of its weapons to deter fraud,” he said. “It makes already weak punishment even weaker by waiving the regulations that impose significant consequences on the companies that settle fraud charges. No wonder recidivism is such a problem.”

If you're about to lose your home …
… maybe it's time to just OCCUPY it

The equitable case is the widespread fraud and deception involving subprime mortgages raining down on innocent homeowners following the Wall Street crash and the corporate greed that caused it. This is the ugly license fostered by massively one-sided, fine-print contracts.

Ralph Nader

Theresa Amato

Chicago Tribune

The Occupy people are joining with community groups that believe many homeowners in foreclosure, or about to be taken over, have a strong, equitable and often legal case to physically stay in or occupy empty homes in order to stave off eviction or keep people in their houses.

Speaking to a conference of consumer attorneys in Chicago in December, Illinois Attorney General Lisa Madigan estimated that 80 percent of the paperwork in Cook County of the major mortgage servicers was suspect

Madigan asked the audience to imagine the outcry if even one legal services lawyer or government attorney had engaged in such fraud on the courts. Yet when the banks and their notaries, employees and middlemen do such things, they're called "mere technical violations," she said.



Attorney General Lisa Madigan today filed a lawsuit against Nationwide Title Clearing for filing faulty documents with Illinois county recorders.

Decatur Tribune The lawsuit, filed in Cook County Circuit Court, alleges numerous violations of the Illinois Consumer Fraud and Deceptive Practices Act and the Uniform Deceptive Trade Practices Act. Madigan is asking the court to require NTC to review and correct all documents it unlawfully created and recorded in Illinois, and pay back all revenues, profits and gains achieved in whole or in part due to unlawful practices. The suit also asks the court to impose civil penalties against the company.

How many foreclosure-mill attorneys are primed to face the same fate?

Title Hijacker Gets Five Years For Snatching, Selling Homes Belonging To Others

Home Equity Theft Reporter Records searches determined Cobb had conducted two other fraudulent transactions using identical methods to obtain control over two other properties, which he then sold under the false pretense that he was the rightful owner and seller.
2/2/12 Securitization Fail, Or, The Depth of Schneiderman’s Betrayal If He Signs the Servicer Settlement, Or, Why DE AG Beau Biden Rocks

Perhaps the most critical insight that flows from understanding securitization fail, however, is that the crimes will continue so long as we are processing foreclosures.

Abigail Field Once you understand the securitization fail concept, you can instantly, with tremendous clarity, see the scale of the fraud the Bailed Out Banks and Wall Street firms committed and commit every day. Get securitization fail, and the bankers’ crimes stand out
2/2/12 Why Fannie and Freddie Are Hesitating to Help Homeowners ProPublica The companies say that by bolstering their finances, they are helping to stabilize the housing market as a whole, but Freddie and Fannie have hampered many of the administration's plans to provide relief for struggling homeowners.

Robo-Signing Settlement Might Not Provide Homeowners With Needed Help Huff Post Some consumer advocates familiar with the terms are expressing disappointment, pointing to the provision that encourages banks to focus help on less-troubled borrowers as evidence that the settlement will fail to deliver broad relief.
2/2/12 Seven Questions Begging to Be Answered Before a Foreclosure Settlement Is Reached Huff Post| As a nation, we need to ask several questions. As a participatory democracy, we also have the right to the answers before any settlement is inked:


Bar's ethics opinion little chill to foreclosures

A year ago, the Florida Bar issued an ethics opinion that was a warning for every mortgage lawyer who helps lenders foreclose on Florida homes.

Herald-Tribune Judges remain unwilling to set off a bomb by seriously going after lawyers who file documents that are often just as bogus, even if now often harder to detect.

So the Bar's demand for improved ethics has led to minor tweaks and window dressing, not major changes. The game goes on.


“Stay in Your Homes – You Are Going To Find They Don’t Have That “Paper” Up There On Wall Street”

The depth of the damage is yet unknown. The crooks had been planning the heist for several decades (and generations).

Deadly Clear Laws and statutes have been changed in nearly every state in the nation. And Federal laws have been altered and repealed in a planned effort to pull off the worldwide swindle. Economists do not think this was merely a miscalculated error. There was too much precision in the information gathered thus far.


Ex-employee in New York has 1,000 pages of customer account records

WND Money Cruz told WND he has “firsthand knowledge and proof of how HSBC transferred billions of dollars through accounts linked to companies that did not exist.

"What I found at HSBC were thousands of accounts established for phantom businesses that had apparently only thousands of dollars of claimed business each year, but millions of dollars flowing into and out of the accounts every month.”


Bribery, compromised officials leave indicted financial-crime suspects free from prosecution under Holder’s DOJ

U.S. Attorney General Eric Holder is aware prosecutors and elected officials were bribed and otherwise compromised, but has not held anyone accountable.

Issa's letter to Holder

Daily Caller A U.S. Justice Department source has told The Daily Caller that at least two DOJ prosecutors accepted cash bribes from allegedly corrupt finance executives who were indicted under court seal within the past 13 months, but never arrested or prosecuted.

Holder does not want to admit public officials accepted bribes while under his leadership.


Obama outlines homeowner relief plan.  Another costly failure?

(First thing they must do is stop the ongoing fraud, which is making the crisis worse by the day.  To stop it, they must use the "abundance of certifiable evidence" to easily shut down the foreclosure-mills and robo-signors, disbar the rouge judges and lawyers and criminally prosecute them.   That will stop this on-going fraud virtually overnight. MSF

Miami Herald House Speaker John Boehner, R-Ohio, told reporters Wednesday that numerous administration efforts to assist homeowners have failed and that the housing market instead needs to be allowed to bottom on its own.

"None of these programs have worked," Boehner said. "And I don't know why anyone would think that this next idea is going to work."

Ex-Marine Reoccupies His Own Foreclosed Home in Fight Against Freddie Mac, JPMorgan Chase Democracy Now "Well, we have a loan modification department and a foreclosure department, and the foreclosure department decided to sell the house." So they sold the house.


In conclusion, the inquiring attorney first should attempt to have the client correct the improperly verified and notarized affidavits. The inquiring attorney should advise the client that if the client fails to correct the affidavits, then the inquiring attorney will have to withdraw and will have to reveal the truth to the court. 

Matt Weidner, Esq.



If the client refuses to take the required corrective action, the inquiring attorney will have to reveal the fact that there has been an improperly verified and notarized affidavit filed in each of these cases, whether they are pending or already closed. The inquiring attorney also will have to move to withdraw from further representation of the client impending cases, where the client refuses to correct the affidavits, while making as minimal a disclosure as necessary when doing so.

Failure To Give Homeowner Notice Of Right To Have Face-To-Face Meeting With Lender Within 30 Days Sinks Subsequent Foreclosure Sale

Beneficial Consumer Discount Company v. Vukman

Home Equity Theft Reporter Monday, the Pennsylvania Superior Court  affirmed a trial court order setting aside a foreclosure sale where the foreclosing lender failed to satisfy certain requirements to provide notice to the homeowner.

Ex-Credit Suisse Traders To Be Charged Over Subprime Fraud

Federal prosecutors are expected to charge four former Credit Suisse brokers with criminal fraud for misleading investors by inflating the value of subprime mortgage derivatives to increase their own bonuses.


Huff Post After years of criticism and public outrage over the lack of criminal prosecutions of Wall Street traders and executives whose risky trading helped cause the financial crisis, the Justice Department and the Securities and Exchange Commission seem to be finally taking action.

Last week, it was reported that DOJ was probing possible fraud at WMC Mortgage Corp., the former subprime mortgage division of General Electric, and more such cases from DOJ and the Securities and Exchange Commission are reportedly due in the coming months.

January 2012

Stop Payment!

A homeowners’ revolt against the banks

Harpers  The first slide was cryptic. QUIET TITLE: THE NEW AMERICAN REVOLUTION, it said. The presenter, a former real estate broker named George Mantor, promised the words would make sense by the end of the two-hour workshop. “The revolution takes learning,” said Mantor.
1/31/12 LPS Uses Bogus Florida IG Report on Firing of Foreclosure Fraud Investigators in Motion to Dismiss Nevada Lawsuit

Theft of a home and thousands of dollars in equity is a felony that an $1,800.00 fine will not make go away. That is less than the cash for keys scam. (MSF)

FDL Put aside Bondi’s dissembling for a second, and the idea that an $1,800 for the theft of your home represents “historic” relief. This lawyer in Utah called it what it is: “An arbitrary system of modifications administered by the same banks that knowingly perpetrated the fraud on the homeowner in the first place, and allowed to get off by paying $1,800 for an illegal foreclosed home. That’s outrageous.”

Michigan AG asked not to sign on to foreclosure fraud deal with feds

In Michigan, Hertel has been a leading voice in ferreting out robo-signing foreclosure fraud.

Full letter is included in post

American Independent Hertel is urging the state’s top law-enforcement officer to talk to the Michigan people about the deal, which he says has been “shrouded in secrecy.” Hertel says the deal is rumored to include immunity from criminal prosecution for executives and employees of JP Morgan Chase and CitiGroup — something he vehemently opposes

How the Housing Market Could Shape the 2012 Election PBS A new Standard & Poor's Case-Shiller Home Price Index showed U.S. home prices fell for a third straight month in two Florida cities, Miami and Tampa. Jeffrey Brown discusses the housing market's role this election season with The Wall Street Journal's Arian Campo-Flores and Jed Kolko of the real estate website Trulia

Federal Judge OKs Banksters' Sleazy, Illegal Conduct During Foreclosure Litigation Where Homeowners Fail To Immediately Raise Issues 

Home Equity Theft Reporter The class-action suit was filed after a former paralegal at the defendant Shapiro & Burson, a law firm based in Virginia that has handled many Maryland foreclosure cases in recent years, complained to regulators and prosecutors, alleging that robo-signing there was routine.

Ex-Marine Reoccupies His Own Foreclosed Home in Fight Against Freddie Mac, JPMorgan Chase Democracy Now! "Well, we have a loan modification department and a foreclosure department, and the foreclosure department decided to sell the house. So they sold the house." 

Colorado Lawmaker Moves To Tighten Up State Foreclosure Procedures, Minimize Sleazy Conduct From Banksters, Lawyer-Sweatshops Home Equity Theft Reporter The practice of allowing foreclosure attorneys simply to attest with a signature that a bank has the right to take someone's home rather than produce the actual mortgage documents is the target of new legislation.

Florida Bar says foreclosure lawyers must report fraud to court

When fraud is suspected, an attorney's duty to the court supersedes the attorney's duty to the client, Booth said.

Palm Beach Post Investigators for the Florida Attorney General's Office have found tens of thousands of forged signatures, backdated documents and other problem paperwork at four law firms, so-called "foreclosure mills" currently under investigation.

The biggest and most troublesome problem is what to do with cases that ended years ago. Can judges undo these foreclosures, and what happens in cases in which the home was sold to new owners without a clear title?.


City Council Testimony on New York City’s Foreclosure Crisis

"We have seen continued evidence of the need to protect homeowners’ rights, and the opportunities for abuse that arise when homeowners lack legal counsel."

Brennan Center for Justice

Testimony of
Mark Ladov and

 Nabanita Pal

“The right to adequate counsel is important in every litigation; it is only amplified in foreclosure cases by lenders’ attorneys who often file cases in bulk and pay inadequate attention to the particular facts and needs of each individual case. 

Corporations know that their grip on power is slipping.

Banksters of America demand, "No Free Speech for mortgage!"

Bank of America is pushing back when offering loan modifications to people who are complaining publicly. The catch is the borrower must stay quiet and remove any previous criticisms of the bank from public records, like tweets or facebook.

The Daily Take According to one borrower the bank included this language, "The borrower "will remove and delete any online statements regarding this dispute, including, without limitation, postings on Facebook, Twitter and similar websites," and not make any statements "that defame, disparage or in any way criticize" the bank's reputation, practices or conduct, according to documents filed in state court in Phoenix."

More illegal foreclosures...

I-Team: Nevada Homeowners File Class Action Lawsuit After Foreclosures

The class action lawsuit is against five companies hired by banks to collect debts and begin the eviction process. This lawsuit is one of the first of it's kind in the country

8newsNow "These companies not being licensed and didn't have the ability to legally do the things that they did. Send notices out, foreclose on them, get them out of the house, move for eviction," attorney Shawn Christopher said.

The lawsuit targets: Quality Loan Service, MTC Financial, Meridian Trust Deed Service, National Default Servicing and California Reconveyance company


Finally the Court is Putting Some Teeth into Automatic Stay Violations

Florida Bankruptcy Lawyer Blog It seems times are changing and the court has had enough of the violative conduct. While in court today, for one of my own cases and observing another attorney’s seeking sanctions, the judge awarded compensatory damages to both of our clients and $10,000 in punitive damages for each along with our attorney’s fees.

Jackie Ramos vs Bank of America, part 2

Jackie Ramos caused a huge stir by going public, on YouTube, with her story of working for Bank of America, which fired her for allowing customers to pay off their debts with installment loans.

At the very least, this is a case of Bank of ScAmerica communicating in an absolutely atrocious manner with one of its homeowners. And at worst, it’s a case of BofA foreclosing on and evicting someone who should instead have had her home paid off.

Reuters Ramos agreed to keep on making those insurance premiums, since they would allow her to stay in her home if anything ever happened to the other person on the mortgage, her son’s father Tim.

Then, in April 2011, Tim died — and the mortgage insurance didn’t pay out. Instead, BofA foreclosed on Ramos, and she lost her house.

NV AG Masto Defends Nevadans Against a Rushed and Bad Servicer Settlement Abigail Field Let’s take a good, hard look at the NV AG’s letter. Let’s start with what she wants: answers to 38 questions, “in writing with citation(s) to the specific place or places in the settlement language where it applies.” Masto’s saying look, DOJ, look HUD, look lead negotiators, I’m not taking your word for anything. Put it in writing and SHOW me why I can believe you.
1/30/12 A Wells Fargo Loan Modification Victim Speaks Out In Protest

"Their story is by no means unique. It is a story that continues to unfold across the United States by the millions."

Examiner This is a story about an American family and their fight to save their home. It is a story about the lies, victimization, and callousness that this family has had to endure at the hands of their bank, Wells Fargo.

New Bill to Protect VA Homeowners from 'Fraudulent' Foreclosures

Delegate Marshall says his concern is that there has been little accountability for banks' actions, even if they wrongfully foreclose on a person's home.

public news service It's happening all over Virginia: when unemployment hits a household and the homeowner falls behind on the mortgage, that homeowner tries to work with the lender to modify the loan terms. The owner pays a fee to get the loan modification - and the bank forecloses anyway. 
1/30/12 Freddie Mac Bets Against American Homeowners ProPublica Freddie Mac, the taxpayer-owned mortgage giant, has placed multibillion-dollar bets that pay off if homeowners stay trapped in expensive mortgages with interest rates well above current rates.

Freddie began increasing these bets dramatically in late 2010, 

the same time that the company was making it harder for homeowners to get out of such high-interest mortgages.


As Mortgage Settlement Deal Nears Feb. 3 Deadline, Nevada AG Raises Concerns

In a letter, Nevada's attorney general, Catherine Cortez Masto, asked 38 questions relating to a variety of concerns, including fears that states would play second fiddle to the federal government in making decisions.

Huff Post Some remain unconvinced. "Look at what happened with WorldCom ... Those guys were committing fraud at their own companies, and still they went to jail for what they did," said a prominent securities lawyer referring to the fates of CEO Bernard Ebbers and other WorldCom executives. In comparison, "these financial shenanigans had an impact way beyond any one company, and these guys are still walking around free," the lawyer said. "There's just not been much effort to hold Wall Street or any of these other guys accountable."

How To Attack The “We Hold The Note Your Honor…That’s All That Matters!

 Opposing Counsel says to the Judge “we hold the note Your Honor” and the judge says to you…they have the note your motion is denied!  What did you miss?

Litigation Offense Just recently Jacqulyn Mack of the Mack Law Firm brought her bite and this argument right to the 2nd DCA’s doorstep in Feltus v. U.S. Bank and gained a favorable detailed decision that will certainly bring this attack and GREAT rebuttal on the “we hold the note that’s all that matters” position.


Suits challenge way foreclosures are performed in Missouri stltoday By raising questions about which lender actually owns the mortgages, the suit claims certain foreclosures weren't properly done and it asks the courts to give "hundreds, even thousands" of Missourians their foreclosed homes back.

Court rulings on foreclosures and quiet title

Title Search The battle over foreclosures is pushing the envelope for legal strategies in court cases all over the country. One of the fastest growing trends appears to be the use of quiet title actions to resolve difficult scenarios.
1/29/12 A Reform for Fair Courts NY Times Judges who deny a recusal request will need to provide their reasons in writing, and the final word on recusal will not be left to the challenged judge. The litigants will have a chance to appeal recusal decisions to the court’s other judges.

Moyers: How Big Banks are Rewriting the Rules of our Economy

On the repeal of Glass-Steagal: "The fix was in. The path was cleared all the way to the top."

Bill Moyers "If you had asked me, under oath, what probability I would have given that you would have gotten the whole group of Wall Street participants to get it wrong, so to speak -- I would have said zero."

A Victory for the Public on Foreclosures? Matt Taibbi

Rolling Stone

If these reports are true, it looks like New York Attorney General Eric Schneiderman and California AG Kamala Harris have scored an enormous victory in narrowing the scope of the settlement to the point where it really only covers robosigning abuses.

What a Strong Servicer Settlement Looks Like

How can an AG, in good conscience, take a deal without knowing what it’s worth to his or her state?

Abigail Field Robosigning’ isn’t simply about signing documents in a funny way; it’s about creating documents the banks don’t have because they didn’t do their job right at the outset. Why are they creating the documents? So they can win foreclosure cases. That’s obstruction of justice.

They’re creating documents in the name of companies that have long since gone out of business, for example.


Rachel Maddow


"If the foreclosure was illegal, the borrower should be able to get their deed and their home back from the bank."

John Reed on Big Banks’ Power and Influence Bill Moyers Bill Moyers talks with former Citigroup Chairman John Reed to explore a momentous instance: how the mid-90’s merger of Citicorp and Travelers Group – and a friendly Presidential pen — brought down the Glass-Steagall Act, a crucial firewall between banks and investment firms which had protected consumers from financial calamity since the aftermath of the Great Depression.

In effect, says Moyers, they put the watchdog to sleep.

1/27/12 Banks Taketh, but Don’t Giveth NY Times “There are three branches within walking distance, but I have to take two subways to reverse my charges? That is insane.”

New Fed Task Force Subpoenas 11 in Mortgage Fraud Probe abc News “You can expect more to follow,” Holder said in reference to the subpoenas being sent out. “Of course, I can’t go into detail about our existing investigations.  But I can tell you that significant efforts are moving forward, by both federal and state authorities.”
1/27/12 Liability Release on Foreclosure Fraud Settlement Narrow, But a Host of Questions Remain David Dayen


Private right of action would still be available under any settlement – Attorneys General cannot stop the right of an individual to sue over misconduct – and there would be no criminal liability release. In addition, these avenues of inquiry would still be available.


RESPA Timelines & Penalties 

Comparison Between Current RESPA and Dodd-Frank Amendments


Current RESPA


Time to acknowledge QWR

20 days

5 days

QWR response deadline

60 days

30 days*

Damages each violation- Individuals

Actual plus $1000

Actual plus $2000

Damages each violation- Class Actions

Capped at lesser of $500,000 or
1% of servicer's net worth

Capped at lesser of $1,000,000
or 1% of servicer's net worth


1/27/12 Where’s the Money? Pretenders Relying on Transfers But No Sale of the Loan

The pretenders are playing a shell game that is intended to strip the homeowners of their claims, their remedies, and their homes.

Neil Garfield

Living Lies

 It’s working because hardly anyone is asking where the money went. Instead of looking for cold hard cash, we are trapped in a never ending cycle of cases in which the homeowner, either pro se, or through counsel, has essentially conceded the case away by admitting the debt, admitting the default, admitting the amount owed, and admitting that the opposing side either does or might have the right to foreclose on behalf of nameless third parties who were never disclosed.
1/27/12 Michael Hudson: Banks Weren’t Meant to Be Like This Michael Hudson The inherently symbiotic relationship between banks and governments recently has been reversed. In medieval times, wealthy bankers lent to kings and princes as their major customers. But now it is the banks that are needy, relying on governments for funding – capped by the post-2008 bailouts to save them from going bankrupt from their bad private-sector loans and gambles

“Mortgage Fraud is a Top Priority for This Administration”... or so they say. naked capitalism I’d love to see real prosecutions of the people that caused the mortgage crisis and rigged the markets to collapse. But it’s important to recognize that it is the policy of the Bush and Obama administrations to protect the banks at all costs. That is, not prosecuting isn’t a failure, it’s a feature. Don’t believe me, believe Barack Obama, who said so in his very first State of the Union. - FBI Asst. Director Chris Swecker - March, 2005 

Problems occur everywhere

Raging against the Foreclosure Machine

Magner, the New Orleans judge, has dug into the accounts of more than 20 borrowers in her court since the Stewart case and found mistakes in every one of them, she said in a recent interview.

These are loans of working-class people who bought homes they could afford and whose loans were not administered correctly from an accounting perspective,” she said. “I think that these types of problems occur in almost every [defaulted] loan in the country.”

iWatchNews Wells fought successfully to keep the results of the audit under seal, and last summer a federal appeals court overturned the part of Magner’s ruling that required the audit. But two people familiar with the results told iWatch News that Wells Fargo’s audit had turned up accounting errors in nearly every loan file it reviewed.

So far, the most muscular attempts to rein in mortgage servicer bad practices have come in U.S. bankruptcy courts, where many judges, including Magner, have an accounting background. Justices in New York, Texas, Mississippi, Louisiana, North Carolina, California, and Massachusetts have sanctioned servicers for abusive practices.


California AG Harris Turned Down a Guaranteed 60% of the Foreclosure Fraud Deal David Dayen


This settlement deal is so bad, that even the state getting 60% of it sees that it would not provide commensurate relief to the scale of the problem. When the overall deal is $25 billion and there is $700 billion in negative equity nationwide, you can see that as a problem. Plus, if I were any AG, I would doubt the enforcement, since the last time they settled with a mortgage lender on fraud claims, and were supposed to get loan modifications as a result, Bank of America didn’t do the mods, in the Countrywide settlement.

Obama Administration And Banks Near Deal On Mortgage Fraud Legal Liability Huff Post According to someone intimate with the negotiations, there will be no legal release of the banks with respect to:

- Criminal liability.
- Tax liability
- Fair lending, fair housing, or any other civil rights claim.
- Federal Housing Finance Agency or the GSEs [Fannie Mae and Freddie Mac]
- CFPB claims for the period after they came into existence in July 2011
- SEC claims
- National Credit Union Association Claims
- FDIC claims
- Federal Reserve Board claims
- MERS claims

UFAN Files New Lawsuit Against U.S. Bank on Behalf of Borrowers

US Bank had an interest in foreclosing on Plaintiffs as it no longer held the risk of default and now receives fees for foreclosing.

PRWeb Plaintiffs argue that US Bank “wore two hats” – one of a purported lender of money and one as a developer and seller of residential mortgage backed securities (RMBS). By taking on such a dual role, US Bank was no longer acting as a mere lender of money, but instead acting as a middleman in marketing and selling loans.
1/26/12 Help for homeowners when mortgage problems arise

Even homeowners who play by the rules can run into problems with lenders.

Reuters What if I believe I'm a victim of mortgage fraud?

In addition to the national organizations mentioned above, consumers can file a complaint with their state's attorney general.

Many states, especially those which saw steep increases in home values followed by precipitous drops, have also seen fraudulent mortgage loan workout schemes and have formed initiatives to help consumers fight back in instances where incomplete disclosure or bait-and-switch tactics have left their mortgage vulnerable.

The National Association of Attorneys General ( provides a list here.
1/26/12 Bank of America Settlements Impede Fraud Probe, Arizona Says

Under the terms of the settlements, even if subpoenaed, borrowers can’t reveal any unflattering information about the bank. They couldn’t talk about misrepresentations the bank made about loan mods, which is what the state is investigating, she said.

Bloomberg Bank of America Corp. is impeding an investigation of its loan modification practices by negotiating settlements with borrowers who must agree to keep them secret and not criticize the bank in exchange for cash payments and loan relief, Arizona officials say.
1/26/12 Bank of America Does the Wright Thing DOERS Did It Again. JOIN US, BE A DOER! Mandelman Matters By mid-day on Tuesday, Bank of America had responded to say they were looking into it… and by 4:30 PM that same day Bank of America DID THE WRIGHT THING, and gave Mr. Dale Wright his home back… from a bonafide third party purchaser.
1/26/12 Elderly Couple Says Misapplied House Payments, Force Placed Insurance Racket Victimized Them Into Foreclosure

The experience has caused her to "hate this beautiful home." 

Home Equity Theft Reporter "What we are alleging is they took money that we submitted for payment to the principal and interest and instead applied it toward insurance," Watson said. But the couple claim that they already had insurance, so the lender was wrong to take out the home insurance policy.

New Housing Task Force Will Zero In on Wall Street

Skeptics still doubt the sincerity of the new effort.

NY Times Officials said the unit would most likely focus on Wall Street firms, big banks and other entities that many people thought had escaped scrutiny for their role in the housing crisis. The task force will most likely follow the lead of New York and Delaware, which are investigating potential flaws in the creation of mortgage-backed securities that could lead to charges of tax evasion, insurance fraud and securities fraud.

A Web of Financial Fraud and Criminality: America's Shadow Banking System Ellen Brown Investigation reveals Robo-Signing did not just happen occasionally but was an industry-wide practice, dating back to the late 1990s; and that it may have clouded the titles of millions of homes.  If the settlement is agreed to, it will let Wall Street bankers off the hook for crimes that would land the rest of us in jail – fraud, forgery, securities violations and tax evasion. 
1/26/12** Old Mortgages Rise from the Dead, Haunt Homeowners

This article should make you want to scream.

The reincarnating mortgage is only the latest development in the megabanks' mortgage debacle, a scandal that has made them the target of a mounting pile of investigations and lawsuits.

Michele Conlin


Wilson settled a wrongful foreclosure case with Wells Fargo in June 2010. That month, court records show, Wells Fargo filed a satisfaction of mortgage document noting that the $8,000 loan on Wilson's home had been paid in full.

But more than a year later, on December 8, 2011, Wilson answered her door to see a process servicer brandishing foreclosure warning papers from Wells Fargo.




Lawsuit: 'Profits Were Running the Show' at Leading Credit Ratings Agency

People v. The McGraw Hill Companies, Inc. et ano.

Illinois AG

Home Equity Theft Reporter

Privately, S&P abandoned its principles and instead used every trick possible to give deals high ratings in order to retain clients and generate revenue. The mortgage-backed securities that helped our market soar – and ultimately crash – could not have been purchased by most investors without S&P's seal of approval
1/25/12 Exclusive: Senate investigating HSBC for money laundering

The Senate Permanent Subcommittee has a history of conducting high-profile hearings that have proved embarrassing for the world's biggest banks.

Reuters HSBC Holdings PLC is under investigation by a U.S. Senate panel in a money-laundering inquiry, the latest step in a long-running U.S. effort to halt shadowy money flows through global banks, according to people familiar with the situation and a company securities filing.


JPMORGAN/EMC MORTGAGE FAILED TO ENSURE THAT TITLE TO THE UNDERLYING MORTGAGE LOANS WAS EFFECTIVELY TRANSFERRED 4closureFraud A fundamental aspect of the mortgage securitization process is that the issuing trust for each offering must obtain good title to the mortgage loans comprising the pool for that offering. This is necessary in order for the holders of the RMBS to be legally entitled to enforce the mortgage loans in the event of default.
1/25/12 After Obama speech, three arguments for housing

Almost 8 million Americans have lost their homes to foreclosure since in 2007.

ajc A 30 percent drop in prices has wiped out $7 trillion worth of homeowner equity since 2006. The housing collapse has left families feeling poorer and less willing to spend. A quarter of homeowners owe more than their house is worth.
1/25/12 The Mortgage Investigations Drag On Reuters Blog Frankly any settlement now looks just as far away as ever. After all, there’s no point in setting up a new investigation to hold banks accountable, if we’re about to see a settlement which prevents any law-enforcement body from doing that.

Kamala Harris: National Mortgage Deal Still Not Good Enough For California

One major issue still undecided is the extent to which banks will be released from liability for misconduct in the mortgage market, say sources familiar with the negotiations. If a broad release is granted, states couldn't pursue their own civil investigations of bank misdeeds.

Huff Post "We've reviewed the details of the latest settlement proposal from the banks, and we believe it is inadequate for California," said Shum Preston, spokesman for the California Department of Justice in a statement released Wednesday. "Our state has been clear about what any multistate settlement must contain: transparency, relief going to the most distressed homeowners, and meaningful enforcement that ensures accountability. At this point, this deal does not suffice for California."

NY AG Schneiderman backs expanded mortgage probe UticaOD "The American people deserve a robust and comprehensive investigation into the global financial meltdown to ensure nothing like it ever happens again," Schneiderman said. His office will work with federal authorities to hold accountable those responsible for the economic crisis, "providing meaningful relief for homeowners commensurate with the scale of the misconduct," he said.
1/25/12 Bank of America Says Loan Repurchase Claims Rise to Record $14.3 Billion Bloomberg The increase was fueled by disputes with Fannie Mae and private investors who are submitting demands for compensation on the grounds that they were misled about the quality of mortgage securities.

Nevada court: Lenders must have foreclosure papers

In unanimous rulings Friday in the state hardest hit by foreclosures during the Great Recession, the high court ruled there was insufficient documentation for separate foreclosure cases involving CitiMortgage Inc. in Las Vegas, and HSBC Bank USA in Reno

CBS News



Home Equity Theft Reporter provided links to rulings

The July cases — Leyva v. National Default Servicing Corp. and Pasillas v. USBC Bank USA — call for a strict standard of proof of ownership for lenders, including a requirement they produce the original note and deed of trust plus subsequent ownership records before seizing homes.

Piazza v. Citimortgage, Inc.

Karl v. HSBC Bank, USA, N.A.




The robo-signing largely involved assignments of mortgage notes to mortgage servicers or trusts representing the investors who put up the loan money. Assignment was necessary to give the trusts legal title to the loans. But assignment was delayed until it was necessary to foreclose on the homes, when it had to be done through the forgery and fraud of robo-signing. Why had it been delayed? Why did the banks not assign the mortgages to the trusts when and as required by law?



Ellen Brown, JD

Web of Debt

The hasty solution was a rash of assignments signed by an army of “robosigners,” to be filed in the public records. But the documents are patent forgeries, making a shambles of county title records.

Complicating all this are tax issues. Since 1986, mortgage-backed securities have been issued to investors through SPVs called REMICs (Real Estate Mortgage Investment Conduits). REMICs are designed as tax shelters; but to qualify for that status, they must be “static.” Mortgages can’t be transferred in and out once the closing date has occurred. The REMIC Pooling and Servicing Agreement typically states that any transfer significantly after the closing date is invalid. Yet the newly robo-signed documents, which are required to begin foreclosure proceedings, are almost always executed long after the trust’s closing date. The whole business is quite complicated, but the bottom line is that title has been clouded not only by MERS but because the trusts purporting to foreclose do not own the properties by the terms of their own documents.

Portland foreclosure attorney hit with ethics complaint due to premiums

The complaint is intriguing on several levels. Since the economic crash of 2008 let loose a tidal wave of home foreclosures, the financial industry has been accused many times over by homeowners of improperly and fraudulently repossessing homes. But in this case, one of Northwest Trustee's own vendors alleges wrongdoing, with 26 pages of painstaking detail backing up the claim.

OregonLive Dillard alleges that Northwest Trustee and its advertising operation, FEI, charged its clients an undisclosed 18 percent premium over the actual price. These "deceptive and dishonest" tactics, Dillard said, allowed FEI to collect from its clients about $360,000 more than it actually paid for the foreclosure notices published in the Redmond newspaper just since 2009.

Those costs were then presumably passed on by banks to homeowners and others, Dillard said. 

1/24/12 Who Will Be the First to Sue the CFPB? Mortgage Servicing News "The only people who are going to have standing in the near future are people who the bureau targets for an enforcement action, either in court or through the administrative process at the CFPB,"
1/23/12 Insurance proceeds for destroyed beach house delayed by multiple claims Southeast Texas Record "The defendant is unable to determine which, if any, of the defendants are entitled to the policy proceeds," the suit says.

"There is an issue between the named insured regarding insurable interest and ownership of the insured property."

FDIC's Latest Failed Bank Lawsuit Includes D&O Insurer Defendant

The Complaint

The D&O Diary In the FDIC’s latest lawsuit filed in its role as receiver of a failed bank, the FDIC not only named as defendants nineteen former directors and officers of the failed bank, but also included as defendants seventeen of their spouses and the failed bank’s D&O insurer.
1/23/12 FED is Selling Loans: Does it Own Them? Neil Garfield

Living Lies

Based upon published reports, the inescapable conclusion (or at least question of fact in litigation) is whether some or all of the foreclosures are being prosecuting on behalf of entities (trusts) that no longer exist and which are not owed anything because they have been bought out by the Federal Reserve, which in turns probably has no rights to pursue homeowners, and therefore should not be claiming ownership over loans that it has no authority, legal or otherwise, to enforce.

ASU law student to argue case before Arizona high court

For the past six months, Robertson has represented homeowners facing wrongful foreclosure.

axcentral Robertson will address issues related to the practical problems that result when homeowners are denied their right to challenge illegal foreclosures in court.

Click here to view oral argumentin HOGAN v. WAMU

1/23/12 Gansler urged not to sign foreclosure settlement

State attorney general gets calls, letters, petitions as part of national pushback against impending deal with banks

The Baltimore Sun As state attorneys general across the country consider whether to settle with big banks over shoddy and illegal foreclosure practices, some Marylanders are urging Douglas F. Gansler not to sign on the dotted line.

Their efforts are part of a nationwide effort to press for investigations and lawsuits instead.


MA Register of Deeds offers Affidavits Michael S Their office will supply anyone in the Country with a sworn affidavit regarding any robo-signer that may have appeared on their mortgage documents and land recordings. They will only provide an affidavit to the approved Robo-signers on their

Should Mortgage Robo-Signers Go To Jail?

If the affidavit is wrong — or fraudulent — it means an innocent family can unfairly be made homeless by order of the court. This is a big deal, certainly as big as shoplifting or stealing a cow, crimes we seem to prosecute with great zeal.

OurBroker John O’Brien is a Register of Deeds based in Salem, Massachusetts. Instead of burning witches, O’Brien believes we should investigate the people who created the notes and documents that have now destabilized the entire property records system. He also believes those who are guilty of criminal conduct should go to jail and not merely face fines.
1/23/12 Obama to Use Pension Funds of Ordinary Americans to Pay for Bank Mortgage Settlements

Obama’s latest housing market chicanery should come as no surprise

naked capitalism As we discuss below, he will use the State of the Union address to announce a mortgage “settlement” by Federal regulators, and at least some state attorneys general. It’s yet another gambit designed to generate a campaign talking point while making the underlying problem worse.

Commercial Foreclosure: 

Defendant contendsOrix Capital lacks standing to foreclose

Crainscleveland “It appears that the note and mortgage are held in a mortgage pool dreamed up by Wall Street hotshots as a vehicle to convert commercial and residential mortgages into marketable securities that are now at the forefront of the "Robo-signing' mortgage crisis that led to the worst financial crisis in U.S. and world history. ... The real owners of the note and mortgage are a plethora of unidentified individuals and/or unidentified corporate entities who purportedly purchased an interest in the note and mortgage.” 
1/23/12 Tell Obama: Don’t Let Banks Off The Hook For Mortgage Fraud care2 Despite the incredible burden placed upon American taxpayers by the fraudulent behavior of Big Banks and credit card companies, the nation’s top six banks have been living large, completely oblivious to the suffering they caused.

"State attorneys general have been investigating bank fraud, and these critical investigations must not be undermined by a premature and inadequate settlement," said AFL-CIO President Richard Trumka on Monday.

Democrats calling for broader investigation into banks' foreclosure processes

The banks have a "longstanding ugly pattern of homeowner abuse."

The Hill "We know the problem is deep-seeded" and an investigation would provide greater details into banks' practices instead of letting them off the hook with a "sweetheart deal that's a slap on the wrist."

A settlement, which has been in the works since the robo-signing issue emerged in the fall of 2010, shouldn't be a deal focused solely on that practice, nor should it include "blanket immunity for banks." 


Hold Wall Street banks accountable Now, the Obama Administration and Department of Justice have an opportunity to help make things right. Instead of pursuing a settlement deal that lets the banks off the hook, they should commit to a full investigation into the actions of the big banks and the damage they've caused

Silencing Lawyers

It's cheating for lawyers to testify.
They lack "legal competence" to act as witnesses!

JD Lawyers lack personal, first-hand knowledge of the facts of their client's cases. In legal terms, we say they lack the requisite "competence" to testify. The only people who can testify to facts are people who have "personal, first-hand knowledge" of the facts.

1/22/12 Whistleblowers of today echo fraud charges of the 1920s

Whistleblowers from JPMorgan Chase subsidiary EMC Mortgage Corp. are now coming forward with a tale quite familiar to American history buffs, and the allegations smack of the Roaring Twenties’ hidden greed that tanked the entire stock market

AGBeat A letter from the plaintiff’s attorney, Erik Haas explained, “Of particular significance here, the pleadings referenced the testimony of another former Watterson contractor. This contractor testified that Watterson’s review was nothing more than a rubber stamp approval to satisfy defendants’ objective of purchasing a large volume of loans for securitization. As the former contractor stated, the “vast majority of the time the loans that were rejected [byWatterson] were still put in the pool and sold.”
1/22/12 Homeowners association pursues extreme option — foreclosure — against Korean War veteran Sun Sentinel McCray, after all, is just a guy who thought that in the United States, taking away someone's home was reserved for the most extreme of situations, such as defaulting on a mortgage.

McCray's mortgage, however, is paid up.

Forced-Placed Hazard Insurance With Its Own Perils

ONE of the richest and most secretive sources of profit in the mortgage business is coming under scrutiny. It's about time.

Gretchen Morgenson

NY Times

Force-placed insurance appears to be the dirty little secret of the mortgage industry,” Mr. Lawsky said in an interview last week. “It is a silent killer harming both consumer and investors while enriching the banks and their affiliates.” 
1/21/12 Friends of Angelo, Part 2

Darrell Issa, the Republican chairman of the House oversight committee denounced Countrywide’s program as a source of “bribery” and “public corruption”

NY Times Four lawmakers have been referred to the House Ethics Committee for receiving special mortgage loans from the notorious “V.I.P.” program of Countrywide Financial. Ethics rules require members to accept loans only “on terms generally available to the public.”

Occupy S.F. protesters block banks CBS News Hundreds of protesters clad in rain gear marched through downtown Friday evening - one of several events in a day of action organized by Occupy San Francisco and other allied groups on the second anniversary of the U.S. Supreme Court's decision in Citizens United, which removed limits on how much money corporations could spend on political campaigns.


Complaint shows widespread mortgage fraud in Countrywide's Mass offices

A whistle-blower complaint before the Department of Labor reveals widespread mortgage fraud in the Massachusetts offices of Countrywide Financial Corp. in the years leading up to the housing bust and subsequent financial crisis.

Telegram "By 2006, Countrywide's business had degenerated into a massive fraudulent enterprise designed to generate commissions on new loans in high volumes without meaningful consideration of a homeowner's ability to pay," said Gary Klein, a Boston lawyer with Klein Kavanagh Costello LLP, a firm that represents homeowners fighting foreclosures. "Tens of thousands of Massachusetts families were sucked into expensive refinancing deals with significant hidden fees and costs."

Patterson v. GMAC

GMAC Mortgage lacked authority to foreclose the mortgage when it initiated the foreclosure proceedings, and, therefore, the foreclosure and the foreclosure deed upon which GMAC based it ejectment claim are invalid.

Alabama Court of Appeals Moreover, under our holding in Sturdivant, because GMAC Mortgage did not own any interest in the house, it lacked standing to bring its ejectment action against the Pattersons. Because GMAC Mortgage lacked standing to bring the ejectment action, the trial court never acquired subject-matter jurisdiction over the ejectment action. Accordingly, the judgment of the trial court is void and is hereby vacated. Moreover, because a void judgment will not support an appeal, we dismiss this appeal.

Gretchen Morgenson on Fannie Mae’s Web of Influence Bill Moyers In this web-only video, Bill Moyers speaks with Pulitzer prize winning New York Times financial reporter Gretchen Morgenson about how high-level players at Fannie Mae, Wall Street banks, and government agencies allowed the mortgage giant to avoid regulation and enrich its executives — only to leave taxpayers holding the bill after the financial crisis.
1/20/12 Mortgage Principal Cuts Don’t Help Homeowners, says Credit Suisse Bloomberg Reducing mortgage balances is a risky idea that hasn’t been shown to keep borrowers who owe more than their property’s worth in their homes, according to Credit Suisse Group.
1/20/12 Calling All Lawyers to 5,000,000 Crime Scenes

The elephant in the room is that what we’re facing in this country today is not just a foreclosure crisis, what we’re dealing with with is much better described as a FRAUDclosure crisis.

Mandelman Matters There should be no question in anyone’s mind… there are only two paths ahead from which to choose. Both involve fighting a war… but on one path the battle is fought by lawyers in our courts… on the other, by citizens in our streets.

Bending the Rule of Law to Help the Banks: Effort to Draft a National Foreclosure Statute Underway naked capitalism Curiously enough, these “stakeholder” meetings had no representation of investors (Tom Deutsch of the American Securitization Forum would claim he played that role, but everyone in mortgage land knows the ASF is a sell side organization) and effectively no input from homeowners or consumer advocates (none at the first meeting, and only, at the second, in Washington last week).

JPMorgan Sued by Dexia Over $1.7 Billion in Mortgage-Backed Securities

Complaintfrom 4closurefraud

Bloomberg Dexia accused JPMorgan and companies it acquired -- Bear Stearns Cos., EMC Mortgage and Washington Mutual -- of “egregious fraud,” saying they created and sold mortgage bonds backed by loans that they knew to be “exceptionally bad.”
1/20/12 No Prosecutions - No real Investigations. Here's why...

Insight: Top Justice officials connected to mortgage banks

U.S. Attorney General Eric Holder and Lanny Breuer, head of the Justice Department's criminal division, were partners at a Washington law firm that represented big banks and other companies at the center of alleged foreclosure fraud.

Reuters The Justice Department hasn't brought any criminal cases against big banks or other companies involved in mortgage servicing, even though copious evidence has surfaced of apparent criminal violations in foreclosure cases.

The evidence, including records from federal and state courts and local clerks' offices around the country, shows widespread forgery, perjury, obstruction of justice, and illegal foreclosures on the homes of thousands of active-duty military personnel.


Occupy The 


Taking America Back - One Court Case at a Time

The Foreclosure Crisis could not have materialized without incompetent and corruptible judges. The founding fathers' great fear was capture of the minority by the majority. Ironically, today the real problem is exactly the opposite -- it's one of capture of the 99% by the 1%. Corporate power and influence, combined with media driven elections, have rendered the 99% practically helpless against the corruption that exists today:


Call Your Attorney General Today to Oppose Big Obama Push to Get Mortgage Settlement Deal Done

The latest bit of corrupt behavior is that the Obama administration has a full court press on to push the heinous “multi-state” settlement deal over the line.

PLEASE call them TODAY. Here is a list of phone numbers. If you can’t get through, send an e-mail.

naked capitalism Here are some of the reasons to oppose a settlement:

1. There have been virtually no investigations, and the Administration has engaged in cover-ups rather than trying to get to the bottom of the mortgage mess.

2. The big argument made in favor of the deal, that it will help borrowers, is patently false. 

1/20/12 'Coping With High-Priced Insurance That Lenders Make You Buy NY Times What are homeowners doing today as they battle banks’ force-placed insurance, and what should you do if you find yourself in a similar situation?

Mortgage Foreclosure Law Revisions Advised

"(The report) showed a 53 percent decrease in foreclosures in the state of Hawaii that I think we can attribute to Act 48,"

ABC News The task force's 288-page report includes proposed legislation that would make any foreclosure violations subject to enhanced penalties, specify what deceptive practices and acts can void a foreclosure, and set a six-month timeline to take action to prevent a foreclosure sale.

Contingent liability of the day, FORCED-PLACED INSURANCE edition

Reuters In depositions made public following the defense’s failure to properly request confidentiality from the court, Chase employees described a system in which Chase collects hefty commissions on force-placed insurance — yet does no work in relation to the policies.

Foreclosure-Mill Operator Takes Scolding From Judge Over Sloppy Work;

Ordered To Continue Personal Court Appearances Until Each File Is Corrected
Home Equity Theft Reporter Morris had ordered Baum to appear in her courtroom personally after a steady stream of his firm’s lawyers mucked up several of the 180 foreclosure cases he has before the New York federal courts.
1/19/12 Deutsche Analyst Sounded Alarm When Asked to Alter Number

The analyst, this person said, was asked by a mid-level Deutsche executive in late 2007 to make it appear that the investment would produce more cash than the bank actually expected at certain time points.

ProPublica The request came at a crucial moment. In the last months of 2007, investors had grown skittish about such investments amid signs that the housing bubble was deflating, if not bursting. Up and down Wall Street, banks were trying to persuade ratings agencies that large portions of their mortgage-backed securities merited the coveted AAA stamp, meaning that they posed negligible risks of default. The analyst was asked to alter the spreadsheets in order to get a better rating.

Brooklyn judge rescinds unfair forbearance deal

Rossrock Fund II LP v Arroyo

Thomson Reuters

Home Equity Theft Reporter

"An examination of the terms of the agreement and the circumstances of its execution reveal a transaction which is ostensibly designed to ease the foreclosure process in favor of the plaintiff while affording virtually no benefit to Arroyo," Steinhardt wrote. "Under these circumstances, the court finds that the subject agreement is unconscionable and employs its equitable powers to rescind the agreement."

Mortgage fraud complaints quadruple in Massachusetts Housing Wire In the last four years, more than 45,000 Massachusetts families found themselves in foreclosure. Coakley's office recovered more than $600 million in relief for investors and borrowers damaged by banks and investment giants that engaged in corrupt mortgage and foreclosure practices, helping to keep more than 25,400 people in their homes. The office said it returned nearly $60 million in taxpayer funds back to the Commonwealth.


Register of Deeds calls for criminal action against Big Banks

In addition, O’Brien is zeroing in on the major foreclosure law firms that he believes have acted as a co-conspirator in flooding the registries of deeds with these fraudulent instruments.

O’Brien said that if he or anyone else went into one of these major banks and forged a signature on a loan document they would be arrested and sent into jail.

Southern Essex District Registry of Deeds Until the CEOs who allowed these fraudulent activities to happen under their watch are sent to jail for what they did, these types of illegal behaviors will continue.”

I understand that there are other Attorneys General and other public officials across the country who would like nothing better than to sweep this matter under the rug and grant these lenders, loan servicing companies and their foreclosure-mill attorneys immunity for the damage that they have caused, not only to our economy but to people’s property rights.



Action 9: Woman's home loan sold, payment lost

“I’m fearful they’re going to get away with what they’re doing and they will foreclose. 

WSOC-TV Sherry Story is a hard-working single mother and does not have money to waste. For the last two months she has been trying to chase down the $400 payment she made on her second mortgage to Litton Loan Servicing just as her loan was being sold to Ocwen Loan.

Our Morally Bankrupt Government, Justice Part II:

 Defending the Rule of Law

Fraudulent documents facilitate theft from Americans, deprive them of their Due Process rights, cloud property titles–perhaps particularly devastatingly in Massachusetts, and obstruct justice. Theft is facilitated by false affidavits of indebtedness. I don’t just mean false as in the person swearing them out doesn’t have the claimed personal knowledge. I mean the numbers are wrong, just like in the bankruptcy courts. When you lie, and ask a court to force a person to pay you more than they owe you, I call that theft.

Abigail Field Given that the servicers’ filings were so frequently inaccurate that the Court had to change the rules to make them stop, why couldn’t Justice find even one major mortgage servicers to charge with bankruptcy fraud? I mean, it’s not like the servicers didn’t know their math was bad. Debtors attorneys proved it many times over.

O. Max Gardner says that in his experience, the numbers are wrong in 90% of Chapter 13s with a residential mortgage loan


Eight + years since they have known about foreclosure fraud and Eight Million Foreclosures later...

Changes suggested to stave off foreclosure and its ill effects


Baltimore Sun State task force recommends new laws, 'best practices' to help homeowners and neighborhoods.

The FTC's Best Practices "suggestion" to Fairbanks in 2003 and EMC Mortgage in 2008 was such an embarrassing failure, the entire industry responded by cranking up their fraudclosure machine to full speed.  


Discarding the Fallacy that Florida RICO and Federal RICO Are Identical

The federal RICO statute does not contain a statute of limitations provision. The only time limitation of any sort referenced in the federal RICO statute is in §1961(5), which states that to constitute a “pattern of racketeering activity,” two predicate acts must occur within 10 years.

Florida Bar The Racketeer Influenced and Corrupt Organizations Act (RICO)1 has been called one of “the most misused statutes in the federal corpus of law.

In 1986, the "civil" RICO provisions followed, permitting any private citizen to institute a RICO action and access the bounty of treble damages. Entranced by the remote prospect of treble damages, civil litigants continue to employ it as an “unusually potent weapon — the litigation equivalent of a thermonuclear device.


U.S., Banks Near 'Robo-Signing' Settlement

(At least they are calling it what it is.)

The settlement proposes to reduce the amount some homeowners owe on their grossly inflated properties. The banks will pay a few billion dollars from the billions they made from their fraudulent scheme.  

WSJ Homeowners will get nothing out of this settlement.  Instead, they will be forced to litigate in court.  The banks know their criminal activity stripped their victims of their wealth, so very few will be able to afford legal representation.  It was all part of the "Criminal Enterprise Business Model".  MSF

Mortgage foreclosure issues top AG Martha Coakley’s consumer-complaint list

Florida, Texas, Iowa and others... eh, not so much Data confirms what we have known for some time -- the subprime lending and foreclosure crisis is a major concern for homeowners who are often faced with losing their most valued possession,’’ she said in a statement. “It is further evidence that resolving this foreclosure crisis is the single most important thing we can do to restore a healthy economy.”
1/18/12 S.E.C. Charges BankAtlantic Bancorp CEO with Misleading Investors

“This is exactly the type of information that is important to investors,” he said, “and corporate executives who fail to make that required disclosure will face severe consequences.”

NY Times “There’s a war going on between banking agencies and the S.E.C.,” Mr. Stearns said, noting that bank regulators wanted less disclosure and the S.E.C., which watches out for investors in the public markets, wanted more.


MERS Settles, Avoiding Class Action Foreclosure Fee Lawsuit National Mortgage News By seeking class action status, the plaintiffs in the case would have been expanded to include all foreclosed borrowers since Sept. 20, 2001 whose mortgages or deeds of trust were assigned to MERS and who received a demand to pay expenses in excess of what MERS and its member servicers actually paid.

Judges tackle backlog of foreclosure cases
300 cases will be heard by Friday
clickorlando Disturbing video confirming the foreclosure crisis is getting 50% worse in Florida and the courts don't have time for Due Process. 
1/17/12 Federal Reserve as a Hedge Fund: Higher Profits, Lower Pay NY Times I call the Fed a hedge fund because it is operating like one, leveraging its balance sheet to earn huge profits. The main difference between a hedge fund and the Fed is that the Fed effectively creates its own money, so it doesn’t have any borrowing costs, meaning yet more profits. 

The Federal Reserve Knew About the Housing Bubble in 2004

new deal 2.0 It’s clear, from going into earlier transcripts of FOMC meetings, that the Fed actually knew there was a housing bubble as early as 2004. Or rather, it had the data, both anecdotal and quantitative, and even discussed the possibility of a bubble internally.



Occupy Baltimore Supports Fight Against Home Foreclosure The Real News Lila's story is not unfamiliar. She purchased her home in 2006, and after attempting to refinance one of her two mortgages, she was told by the bank that she was not in default and would have to first stop making payments. After she did for 4 months, she learned she had been foreclosed upon. The banks later sold her house two times, in spite of the fact that she was still in negotiations and continuing payments. She says her foreclosures and eviction are fraudulent and illegal.
1/17/12 Complete post:

Challenge them to show a “SALE”

Just because the document contains forgery and fabrication doesn’t mean you win and they lose. Focus on the money trail and challenge them to show a “sale” of the loan where there was an actual payment. They don’t have that and they can’t fabricate it either.

Neil Garfield

Living Lies

They couldn’t sell the note because they didn’t own it — the investors already owned the obligation even though there was a defective note in circulation. The borrowers’ signature did not and cannot create two obligations when they only received one loan. They received the loan from the investors, not the originators. Once you have nailed down that point, the rest is easy to show where the defects in the paperwork matter.

Chase Accused of Brazen Bankruptcy Fraud

JPMorgan Chase routinely fabricated documents to deceive bankruptcy judges, going so far as to Photoshop documents to "create the illusion" of standing "in tens of thousands of bankruptcy cases," according to a federal class action.

Courthouse News Lead plaintiff Ernest Michael Bakenie claims that Chase's "pattern and practice of playing 'hide-and-seek' with debtors, judges and other bankruptcy players" bore rich fruit: that Chase secured motions for relief of stay and proofs of claim in 95 percent of its cases.

Related post from Yves Smith: Class Action Lawsuit Alleges JP Morgan Engaged in Systematic Document Fabrication to Move Mortgage Losses from Its Books into Mortgage Backed Securities


Wells Fargo earns record $4.1 billion in 4Q

...despite losing $272 million directly from repurchasing soured mortgages from investors.

HousingWire The amount of mortgages listed as nonaccrual or in foreclosure dropped to $4.08 billion at the end of the fourth quarter, down from $5.2 billion a year earlier.

Two Expert Witness Affidavits Against EMC Mortgage Lynn Szymoniak

Expert & Certified Fraud Examiner

It is my opinion that this Verification is fraudulent because Rick Wilken was not a corporate officer of EMC Mortgage Corporation as represented. From my experience with the mortgage industry and mortgage documents, I know that Rick Wilken was actually a clerical employee for Lender Processing Services, a mortgage servicing document mill.


MERS, the law, and the State nakedcapitalism If all the title assignments performed under MERS are indeed “crap,” that would give an additional motive — besides pure greed and the lust to inflict pain on the powerless — for the banksters to avoid cram down, HOLC, and any other solution that would involve opening up the MERS can of worms systemically.
1/16/12 Outstanding mortgage buyback claims double at Chase in 2011 HousingWire At Chase, the amount of outstanding rep and warranty claims from investors increased every quarter since the middle of 2010 when the bank reported more than $1.3 billion in claims. And the wave doesn't appear to be regressing, according to some analysts.
1/16/12 Our Morally Bankrupt Government, Justice Edition Part 1: Enforcement Against Financial Meltdown Perpetrators

The government can regain control of Wall Street by vigorous law enforcement of the Great White Sharks and cleaning up document fraud until not a visible trace remains, and the land record systems are rendered harder to deface.

Part II: Defending the Rule of Law

Abigail Field Right now top bankers are so confident no one will prosecute them that they show absolutely no respect for the law. I mean, all the big banks, which means, all the top bankers, have repeatedly violated injunctions they’ve agreed to with the SEC. And why not? As Judge Rakoff noted, the SEC hasn’t enforced a single injunction “against a financial institution for at least the last 10 years.” But it’s more than that; the bankers’ disdain for the law is most clear in the fraudulent documents and the deceptive practices that are part of the banks current business model.

Discrimination Lawsuit Holds Subprime Lenders Accountable

Most outrageously, these communities so devastated by the crisis were also targets of many of the practices that helped cause it -- including discrimination, predatory lending and fraud.

Shaun Donovan (HUD) and 

Eric H. Holder, Jr.(U.S. AG)

Nothing can undo the damage that hard-working, responsible families suffered as a result of these outrageous practices.

However, the $335 million in relief for victims of discrimination will not only address their financial loss, it will make it abundantly clear that this kind of behavior will not be tolerated.

Michigan Appeals Court: Failure To Record Mortgage Assignment Prior To Sale Sinks Foreclosure

Kim v. JPMorgan

Home Equity Theft Reporter The foreclosure-by-advertisement statute, MCL 600.3204, provides, “If the party foreclosing a mortgage by advertisement is not the original mortgagee, a record chain of title shall exist prior to the date of sale under section 3216 evidencing the assignment of the mortgage to the party foreclosing the mortgage.” 

1/15/12 On the Trail of Mortgage Fraud NY Times Big banks created demand and provided credit for dubious mortgage loans, which they bundled into securities and sold to investors. If not for reckless lending and heedless securitizing, there would have been no mortgage bubble and no mortgage bust .

Process Server's Failure To Keep Adequate Records Sinks NY Foreclosure; May Open Floodgates In Effort To Vacate Judgments Home Equity Theft Reporter Not only was Cardi required to keep some record of his attempts to serve Murillo, Winslow ruled, but his failure to do so violated New York General Business Law Article 8, which defines and outlines the duties for process servers -- including, Winslow said, the need to keep "legible" records of service.

New Mexico Supreme Court will rule on foreclosure case NewsOK They haven't had much success so far in the court system with their case, which has gotten the support of such groups as the Santa Fe Neighborhood Law Center, Somos Un Pueblo Unido and the Roman Catholic Archdiocese of Santa Fe.
1/14/12** There Are Judges Killing the Titles

Can you imagine sitting on the bench and not being concerned sua sponte for some 80 year old widow who has made 27 years of payments, was scammed into a short term defective ARM, has lost all of her equity, spent her savings in the modification scheme – and is now getting evicted? Whoa! Wait a minute! Where the hell is the justice here?!

Deadly Clear if Wall Street hadn’t collapsed the economy with their securities scheme – my client would still likely have been able to exercise his option and refinance his mortgage. But Wall Street got caught defrauding investors by inflating appraisals, systematically abandoning underwriting guidelines and over-rating bonds, nothing my client had any control over – they should pay, your Honor – not my client.
1/14/12 California AG Harris Out on a Limb on Mortgage Settlement The Bay Citizen Since taking office as attorney general a year ago, Ms. Harris has clashed with the Obama administration over one of her signature issues: foreclosures and mortgage fraud.
1/14/12 Secrets of Citigroup's Sales Machine

Documents related to the case show how Citigroup pushed exotic investments as safe alternatives to humdrum municipal bonds. The paperwork, which was unsealed recently, makes for fascinating, if disheartening reading.

Gretchen Morgenson

NY Times

Given that harsh judgment, something about this case clearly disturbed the arbitrators. But because such proceedings are confidential, outsiders didn’t know the details — until, that is, Citigroup asked a United States district court to overturn the award.

Now almost all of the documents the arbitrators saw have been unsealed.



Occupy the Neighborhood: How Counties Can Use Land Banks and Eminent Domain

The legal tide is turning against MERS and the banks, giving rise to some interesting possibilities for relief at the county level. Local governments have the power of eminent domain: they can seize real or personal property if (a) they can show that doing so is in the public interest, and (b) the owner is compensated at fair market value.

..."or is this just another scam by public officials to demolish properties for profit?"

truthout The burden of proof would then transfer to the bank or trust claiming title. If the claimant could not prove title, the county would take the property, clear title and either work out a fair settlement with the occupants or restore the home for rent or sale.

Courts Are Taking Notice

The title issues are so complicated that judges themselves have been slow to catch on, but they are increasingly waking up and taking notice. In some cases, the judge is not even waiting for the borrowers to raise lack of standing as a defense.


NY AG funds $1 million to borrowers contesting foreclosures

The New York AG is making $1 million available to nonprofit legal organizations representing homeowners in foreclosures cases.

HousingWire "This funding will provide thousands of New Yorkers with the legal expertise they desperately need to defend their rights and avoid falling prey to unscrupulous mortgage servicers or foreclosure mill law firms filing fabricated or robo-signed documents," Schneiderman said.


Matt Stoller: Fed Transcripts – Why Was Congress in the Dark During the Crafting of Dodd-Frank?

Records of the Fed’s meetings at the height of the housing bubble provide more evidence that our central bankers need to be held accountable.

nakedcapitalism Why don’t we have the transcript for 2007? Or 2008? Or beyond that? Why didn’t Congress have the evidence that Bernanke was an incompetent central banker when he was up for reconfirmation in late 2009? Why didn’t Congress know any of what was revealed yesterday while it was tasked with rewriting the rules governing our entire financial architecture?
1/13/12 Mediation program can go far in preventing foreclosures

(What happens when the lender can't prove it owns the home? MSF)

Delaware Online The best way to move the economy forward is to reduce foreclosures, and the best way to do that is to ensure that homeowners and their lenders sit down and have a meaningful conversation about alternatives. Keeping people in their homes is critical not only to those families but to communities, too.
1/13/12 JPMorgan kicks off bank earnings season with 23% drop in profit

Investors see the bank's decline in earnings and sagging revenue as an ominous precedent for other big financial companies that report results next week.

LA Times Closer to home, major players in the mortgage business, like JPMorgan, continue to struggle with mountains of defaulted loans, foreclosed properties and demands that they repurchase flawed mortgages from government-controlled Fannie Mae and Freddie Mac as well as private investors.
1/13/12 This is the complete article:

Bubble Trouble for the Fed 

Top officials at the Federal Reserve had no idea in 2006 that the housing bubble was about to burst.

I think we are unlikely to see growth being derailed by the housing market,” said Chairman Ben Bernanke at the time.

abc News His comments were contained in hundreds of pages of newly released transcripts of closed-door Fed meetings. Treasury Secretary Timothy Geithner, who was a Fed official, expressed confidence in September 2006 that “collateral damage” from housing could be avoided. Months before the housing bubble burst, igniting the worst financial crisis since the Great Depression, Bernanke and others spoke mostly of a soft landing for the economy.

The views echoed the widely held beliefs of most economists and money managers at the time who were confident about growth and stock valuations.

1/13/12 Freddie Mac Gives Unemployed Homeowners Some Time Examiner The amended offer increases this period to 6 months. In addition, the possibility of a one-year extension exists as well. 

The Foreclosure-to-Rental Screwjob

Federal Reserve chairman Ben Bernanke wants US taxpayers to purchase more of the garbage loans and mortgage-backed securities (MBS) that the big banks still have on their books. (Cash for trash)

counterpunch Why would Congress want to take on more risk when they can keep millions of people in their homes by simply reducing the principle on their mortgages to the present value of the house? (aka–”Cramdowns”) Naturally, the losses would have to be absorbed by the banks who–by everyone’s admission–were responsible for the present crisis due to their lax lending standards and, oftentimes, fraudulent behavior. This would lead to a restructuring of the country’s biggest banks through a Resolution Trust Corporation (RTC) so their toxic assets and backlog of foreclosed properties can be auctioned off as soon as possible.
1/13/12 Bank of America Prepares Emergency Plans at Fed Behest, May Need to Amputate on Geographic Basis nakedcapitalism Despite bank executives bragging about the need to be bigger to compete or to gain efficiencies, the evidence runs completely the other way.


Quiet title action erases mortgage

Title Search There are a few reasons why a quiet title action may be more successful than other foreclosure defense strategies. In the first place, the venue may favor borrowers. In foreclosure court the judge sees hundreds of cases where the borrower is genuinely in default, and almost all cases result in decision against the property owner. This becomes a conditioned response where the presumption is that the lender is correct. A quiet title action generally is argued in civil court, where case outcomes are as much likely to go in favor of plaintiff or defendant.

Inside the Fed in 2006: A Coming Crisis, and Banter

The transcripts provide a raw and detailed account of those errors as they were made.

NY Times The transcripts of the 2006 meetings, released after a standard five-year delay, clearly show some of the nation’s pre-eminent economic minds did not fully understand the basic mechanics of the economy that they were charged with shepherding. The problem was not a lack of information; it was a lack of comprehension, born in part of their deep confidence in economic forecasting models that turned out to be broken.
1/12/12 Bank of America, Big Banks Face Massive Credit Card Case CNBC The impact of such a change would be several times as costly as the Durbin Amendment, which caps fees banks can charge on debit cards and is one of the new rules most hated by the big banks.

Fla Appeals Court: 'Green Card-Lacking' Couple Entitled To Benefit Of State Homestead Exemption Against Forced Sale, Dodging $500K Claim Against Home Home Equity Theft Reporter A Florida appellate court has liberalized homestead exemptions for temporary U.S. residents. The court said that a foreign citizen’s eligibility for Florida homestead depends on his intent rather than the U.S. Immigration Service’s rules.

Massachusetts SJC concerned with toxic foreclosure fallout

If you thought U.S. Bank v. Ibanez was bad, Eaton v. FNMA could be Apocalypse Now.

Boston Globe The Court is considering the controversial question of whether a foreclosing lender must possess both the promissory note and the mortgage in order to foreclose. If the SJC rules against lenders, it could render the vast majority of securitized mortgage foreclosures defective, thereby creating mass chaos in the Massachusetts land recording and title community.

Labor and community groups call for action as mortgage fraud settlement nears People's World Take action, says Working America, the AFL-CIO affiliated community group in response to reports that the Justice Department is nearing an agreement with several banks responsible for ripping off home owners by mortgage fraud.

Obama's 'New' Bank Fraud Deal: Still Unfair, Still Unjust, Still Unbalanced

Know how long it would take for US homes to lose the entire $25 billion amount of this settlement in value?

Less than two weeks.

Information Clearing House The Obama White House continues to push for a settlement that would let bankers avoid being punished - or even investigated - for a wave of mortgage-related crimes that includes perjury, tax evasion, and several types of fraud.



In the Ohio case of Freddie Mac v. Schwartzwald

ADVOCATES FOR BASIC LEGAL EQUALITY, INC., et al. This is a well-written brief arguing the issue of standing.  

Also read the Appendix.


Just a Darn Minute Here

 MERS wants the court to order Davidson to knock it off, and punitive damages.

Courthouse News MERS claims William Davidson deceptively incorporated his Mortgage Electronic Registration Systems in Georgia, causing people to believe they had properly served the real MERS by sending notice to Davidson.
1/10/12 Introduction of Fannie Mae Unemployment Forbearance Fannie Mae The Fannie Mae Unemployment Forbearance program simplifies and streamlines the use of forbearance options by incorporating the following features:
1/10/12** JPM Chase Quietly Halts Suits Over Consumer Debts

Chase's current pullback raises at least the possibility that at least some banks may have documentation problems in other business lines.


Also read this 2008 article: Why banks are boosting credit card interest rates and fees

"Mortgages were simply the first storm to make landfall," Larkin says. "Credit cards are next."

American Banker JPMorgan Chase & Co. has quietly ceased filing lawsuits to collect consumer debts around the nation, dismissing in-house attorneys and virtually shutting down a collections machine that as recently as nine months ago was racking up hundreds of millions of dollars in monthly judgments.


"Securitization is an important economic tool," says Rep. Carolyn Maloney, D-N.Y. "But when we saw the subprime (mortgage) meltdown occur, we started really looking at credit cards as the next crisis. We have to crack down on the abuses."

1/10/12 Bill Black: More Proof of Obama Policy of Covering Up for Elite Financial Criminals nakedcapitalism This column addresses a more general point, the charge that Obama’s financial regulatory leaders actively oppose the prosecution of elite financial criminals and the regulators who conspired with them (to use the term the article quotes Professor Kane as insisting upon).
1/10/12** Meet FL AG Pam Bondi, Foreclosure Fraudsters’ BFF

 Home prices in Florida have fallen so far in some areas homes are selling for less than “a used Toyota.”

Abigail Field Florida’s AG Pam Bondi actions show that her commitment to holding the banks accountable doesn’t even rise to the level of lip service. Why? Is she as committed, as a matter of principle, to facilitating document fraud, “sewer service“, and all the other ugliness that mars Florida foreclosures?

Big Banks Face Inquiry Over Home Insurance Fraud NY Times A New York State financial services agency is investigating several large banks to see whether they fraudulently steered homeowners into overpriced insurance policies.

(Yep, they sure did. MSF)

1/10/12 MetLife to Close Mortgage Unit Bloomberg MetLife, the nation’s largest life insurer, announced Tuesday that it would close its home mortgage-origination operation, costing the company at least $90 million. Most of the 4,300 employees at the unit in Texas will lose their jobs.

Bernanke Doubles Down on Fed Mortgage Bet

Bernanke’s report urged Congress and President Barack Obama’s administration to consider steps with short-term costs for taxpayers, such as widening the role of Fannie Mae and Freddie Mac, the government-supported mortgage guarantors. 

Bloomberg Since the Fed started buying $1.25 trillion of mortgage bonds in January 2009, the value of U.S. housing has fallen 4.1 percent, and is down 32 percent from its 2006 peak, according to an S&P/Case-Shiller index. The central bank is poised to buy about $200 billion this year, or more than 20 percent of new loans, as it reinvests debt that’s being paid off. Some Fed officials have said they may support additional purchases that Barclays Capital estimates could total as much as $750 billion.
1/10/12 Fannie Mae CEO Williams Steps Down Forbes Neither Williams nor his Freddie counterpart Charles Haldeman, who announced his departure in October, were cited in the SEC’s charges, but both came under fire for executive bonus payouts during testimony before Congress in November.
1/10/12 Bank of America Sues Couple for Title Typo They Didn't Make

Bank of America is suing a couple for an 8-year-old typo. The best part? The couple didn't even make the error.

AOL Real Estate The home traded owners three more times after the Borchers sold it, with the mistake on the home's deed escaping the notice of real estate professionals time and time again. It was only when the home recently entered foreclosure under its latest owner that the error came to light.
1/10/12 WEIDNER: Stern Revelations Affect Hundreds of Thousands of Homeowners Neil Garfield 

Matt Weidner

CONCLUSION: Weidner’s question can be answered like this: 

All the foreclosures must be reversed and reviewed with the burden on the forecloser to prove that the accounting was right and that the proper parties were included in the foreclosure.- Neil


White House wants to convert wrongfully foreclosed houses to rentals MSNBC The Obama administration, in conjunction with federal regulators and led by the overseer of Fannie Mae and Freddie Mac, are very close to announcing a pilot program to sell government-owned foreclosures in bulk to investors as rentals, according to administration officials.


Intentional Destruction of the Note

The purpose or intent of the holder beyond the intent to destroy his evidence of indebtedness is immaterial. State Street Trust Co. v Muskogee Electric Traction Co.

Alina If the holder of an instrument intentionally destroys it he thereby forgives and discharges the debt and he may not maintain an action based upon the instrument. The instrument is discharged by cancellation and it is immaterial that there is no consideration and a gift is involved and that there is no written renunciation of rights or delivery of the instrument.

JPMorgan (WaMu) Dismissal Overruled and Judicial Notice of Recorded Documents DENIED

Page includes case documents and Order.

DTC Systems The challenged foreclosure is based upon an Assignment of Deed of Trust dated March 15, 2011. JPMorgan, as successor in interest to Washington Mutual Bank, FA, purports to assign its beneficial interests in the deed of trust to Bank of America, National Association. The assignment is void and improper because JPMorgan has no right or interest in the promissory note as of March 15, 2011, and such purported assignment is fraudulent and false.

From a 2005 case

California Appeals Court: Notice of Default is Void if Description of Default Includes “if any”

Anolik v. EMC Mortgage


DTC Systems EMC Mortgage sought to exercise the power of sale in the Deed of Trust on Anolik’s home based on Anolik’s alleged breach of various obligations secured by the Deed of Trust. Anolik alleged in the fourth cause of action in his second amended complaint (for wrongful foreclosure) that “the events of default as alleged . . . in the Notice of Default . . . [we]re false and untrue” and that “the Notice of Default and Election to Sell [wa]s void” as a result.
1/7/12 The Fed on Mortgage Servicing

Governor Bloom Raskin also emphasizes that the foreclosures reviews are only step one.  There will also be monetary penalties.  Take note of the sentence I underlined below, that the penalties must be large enough to incentivize good behavior (and disincentivize bad behavior).  

Prof. Adam Levitin Indeed, as I've been thinking more about the independent reviews, I'm particularly troubled:  many of the entities doing the reviews are staffed by former bank regulators.  The servicing violations aren't something new. They've been going on for some time. But bank regulators never caught them. The bank regulators were asleep at the switch and only got in the game after the banks themselves voluntarily stopped some foreclosures and major scandal broke. So now we have some of the former cops who dropped the ball reviewing the banks on that very issue. Another turn of the revolving door. I'm shocked, shocked.  


Creating and Implementing an Enforcement Response to the Foreclosure Crisis

The failure of timely enforcement leads to the entrenchment of bad practices and an increase in the costs of correction. For example, turning to what will be the focus of my comments today--

Governor Sarah Bloom Raskin
At the Association of American Law Schools Annual Meeting, Washington, D.C.
the role of mortgage servicers in the foreclosure crisis--the longer it takes for mortgage servicers to make the operational adjustments necessary to fix their sloppy and deceptive practices, the costlier and more difficult it becomes for them to sort them out and correct them.

Massachusetts Is Right to Act on Fraudulent Mortgages WSJ Resolving this foreclosure crisis is essential to restoring a healthy economy. That only will occur after the banks acknowledge the devastation they have caused and listen to those seeking accountability. Through our lawsuit, that voice for accountability is even louder.
1/7/12 Mortgage-Servicing Companies That Broke Law Should Be Fined, Raskin Says

“The Federal Reserve believes monetary sanctions in these cases are appropriate and plans to announce monetary penalties,” she said.

Bloomberg “The Federal Reserve (FDTR) and other federal regulators must impose penalties for deficiencies that resulted in unsafe and unsound practices or violations of federal law,” Raskin said in a speech today in Washington. 
1/7/12 Mortgage Crisis's Effect on Registry of Deeds

 While the banks' actions can be dismissed as merely sloppy paperwork, shouldn't such banks be held to account when that same sloppy paperwork dramatically depreciates the single most valuable asset owned by most people?

Prof. Lars Smith

Univ. of Louisville

[a]nything filed in the registry that causes confusion as to who actually has rights to the property is a "cloud on title," making title unmarketable. Since most buyers will only accept marketable title, such clouds make selling property difficult. If the banks' failure to accurately record mortgage assignments and to follow foreclosure procedures causes homeowners to have difficulty in selling their homes, this is in fact a terrible result which will dramatically interfere with the operation of the real estate market
1/7/12 From East and West, Foreclosure Horror Stories

Consumers have paid the price, it continued, “through bankruptcies, evictions and foreclosures that were predicated upon false, forged, fraudulent and/or inaccurate documents.”

Gretchen Morgenson

NY Times

A former L.P.S. employee who worked in “attorney management,” overseeing firms that performed legal work for foreclosures, told Nevada investigators that L.P.S. required him to resolve issues raised by the firms at a rate of 30 foreclosure files every hour. That’s two minutes apiece.
1/6/11 Banks' Worst Fear for 2012 The Street The NY AG "is saying that the securitization process itself is corrupt and the securities were not legal entities. So then you wake up one day and I'm a bank--let's just use Bank of America, for example--that issued $1 trillion over its life of non-agency securities, and they're all done wrong."(...intentionally MSF)


News from Mass. Supreme Judicial Court on Eaton v. Fannie

Complete ORDER: Having heard oral argument and considered the written submissions of the parties and the various amici curiae, the court hereby invites supplemental briefing on the points described below. Supplemental briefs shall not exceed fifteen pages and shall be filed on or before January 23, 2012... 

Mass. Supreme Judicial Court 1. It has been claimed that requiring a unity of the mortgage and the underlying promissory note, in order for there to be a valid foreclosure, would cloud any title that has a foreclosure in the chain of title, regardless of how long ago the foreclosure occurred. The parties are invited to address whether they believe that such a requirement would have such an effect, and if so, what legal or practical measures exist that might limit the consequences of such a requirement. 2. It also has been suggested that, if the court were to hold that unity of the mortgage and note is required under existing law, the court's holding should be applied prospectively only. The parties are invited to indicate on what authority they believe (or do not believe) the court could make such a holding prospective only
1/6/11 Can Banks Foreclose on Mortgages They Do Not Own? The Big Picture This is more than a technical issue; at risk is whether we, as a nation, are going to allow corporate entities to violate existing law, or even worse, attempt to create their own, extra-legal, non democratic policies.
1/6/12 NY Fed President Dudley Crosses Swords With GSEs and Board of Governors on Housing/Mortgage Mess 

Dudley advocates principal relief via a program of “earned principal reduction” which would allow for put options for all severely underwater borrowers who stay current on their mortgages for three years. But as we will discuss, this proposal is less meaningful than it sounds.

nakedcapitalism I still find these recommendations frustrating, in that they are insufficient given the severity of the problem and also fail to come to grips with widespread servicer abuses (not just servicer driven foreclosures, but also what amounts to theft from investors, via schemes such as double charging fees to borrowers and investors, inflating principal balances, reporting REO as sold months later than the transaction closed, and getting kickbacks on third party charges).
1/6/12 Millions Eligible for Foreclosure Reviews

Federal regulators have required major banks to double check their books.

NBC Los Angeles Millions of Americans who have lost their homes or are at risk of losing their homes could be eligible for a review of their foreclosure to ensure it was legal and correct.

Federal regulators launched a nationwide review of foreclosures that occurred between Jan. 1, 2009, and Dec. 31, 2010. Homeowners have until April 30 to complete a form requesting a review of their foreclosure.

1/6/12 Foreclosure Lawyer Could Lose Her Home Because Of Alleged Bank Error

"I'm disgusted with the whole thing," she said. "My credit is trashed. I have nothing at all to finance my business. I might have to file for bankruptcy."

Huff Post JPMorgan Chase & Co., the bank that services Jackson's mortgage, has declared her loan in default, blocked access to her online account and threatened foreclosure if she doesn't pay late charges that she said are unwarranted. Her once sterling credit is ruined and she could lose her home if the mess isn't resolved.
1/6/12 Securities Fraud: Public interest compels prosecutors to act boldly

Two economists recently singled out Gemstone 7 as a case worth prosecuting. A guilty verdict “would establish precedents that would make other prosecutions workable,” they write. None of the obstacles trump the compelling public rationale for prosecuting the schemers who nearly brought down the U.S. economy.

 “If prosecutors are paralyzed by fear of losses and the complexity of these cases,” write Madrick and Partnoy, “justice may never be done.”

1/5/12** Why Did the Banks Need to Falsify and Forge Fabricated Documents?

The investors who purchased David Stern’s foreclosure mill have taken the extraordinary step of announcing publicly that they had been duped into buying a “criminal enterprise.” 

 It will soon be obvious that virtually all the foreclosure mills operated identically to Stern because they were owned and operated by the same people.

Neil Garfield

Living Lies

They couldn’t go back to the homeowner because the homeowner now knew what was unknown at closing — that the deal was toxic and stupid and couldn’t work. The Court would enter the order the Banks required if they proved that the requirements of law had been met in establishing a mortgage loan. They can’t. So they are left with (a) an unsecured PAID loan to an unknown creditor and (b) liability for fraud. And they can’t fix it.

So they started foreclosing and in order to do so they needed to finesse the borrowers and the Court system with documents that looked right but were pure fabrication. Millions of these foreclosures took place and the Judges who rubber-stamped them never bothered to look at whether the paperwork actually made sense.

 Now, like to or not, all those foreclosures need to be reviewed for fatal errors. And homeowners, getting wise to the fact that they might still legally own homes they were kicked out of years ago, are visiting lawyers to see what can be done to recover the property. My guess, is that the tide has turned. That means homes are going to be returned to homeowners. 


American Home Mortgage Servicing's improper move on Van Horne home gets $50,000 rebuke from judge

Motion to Show Cause

In the ruling, the judge called AHMSI’s actions “willful” and “indefensible.” 



The damages were ordered on a motion to show cause why AHMSI should not be found in violation of the bankruptcy plan and sanctioned. The judge ordered AHMSI to pay the Wright’s attorneys fees, and prohibited the company from further raising any amounts due by the couple without specific approval of the court.
1/5/12 Why Not 100% Risk Retention? Make Mortgage Originators Hold the Bag

Mortgage securitization blew up the home price bubble and detonated the financial crisis. How?

American Banker The investor couldn't know what he was buying, since sales documents lied. There was no effective recourse by investors to originators and distributors who committed fraud. Hence quality was inevitably sacrificed for volume and margin.

"That (loan) information is often more than a year out of date. Besides, it doesn't show stability of income. You could do much better."

Banker: "So what? We sell all the mortgages to the GSEs. IVES satisfies them. 


Squatters in Texas Town Use Arcane Law to Claim Vacant Homes

To District Attorney Shannon, these cases are criminal, pure and simple. 

Fox News Imagine coming back from an extended stay away from home only to find someone has set up shop in your house, claiming it now belongs to them.

The Tarrant County Clerk’s office accepted about 60 of these adverse possession filings this year before it stopped taking them.

1/5/12 The Restatement of Property and the Road to Mortgagocracy Prof. Adam Levitin I've never seen anything like this before. The Restatement here is saying that "courts should bend over backwards to make sure that the lender wins no matter how badly the lender has screwed things up." Is it really an accurate restatement of the law to say "lenders win even if they screw up and don't follow the law"? That sure sounds like a Mortgagocracy. 
1/5/12 INSTITUTIONAL BONDHOLDERS ISSUE INSTRUCTIONS TO TWO TRUSTEES TO OPEN INVESTIGATIONS OF INELIGIBLE MORTGAGES IN OVER $19 BILLION OF WELLS FARGO-ISSUED RMBS Gibbs & Bruns Gibbs & Bruns LLP announced today that its clients have issued instructions to US Bank and HSBC, as Trustees, to open investigations of ineligible mortgages in pools securing over $19 billion of Residential Mortgage Backed Securities (RMBS) issued by various affiliates of Wells Fargo
1/5/12 Foreclosure Stories: Bad advice leads to mortgage crisis

 Unbeknownst to Sally, the same day the bank sent the modification materials to Sally, it filed a foreclosure against her.

Foreclosure Specialist 

Dan McGookey

The lesson from Sally’s tale for every homeowner trying to work mortgage issues out with his or her bank is this: Do not let your guard down and simply believe that your bank will work with you in good faith to allow you to save your home because chances are it won’t – the people behind the foreclosure process are incentivized to foreclose because it is profitable for them to do so. That being so, you may suffer the same fate as Sally if you do not take the necessary actions to properly defend yourself in court.



Sandusky woman sues bank over "robo-" foreclosure

It may be the first lawsuit filed in the U.S. by a private citizen seeking to undo an already completed foreclosure on grounds that a robo-signer was used.

Sandusky Register A Sandusky woman filed a lawsuit Wednesday claiming the foreclosure of her North Larchmont Drive home was spurred on by "robo-signing," where bank employees signed affidavits without bothering to review documents.

Rhonda McLaughlin's lawsuit against Bank of America

9/7/11 Hurricane Fannie Mae destroyed more homes than Katrina and Irene

The hurricane is named after Fannie Mae because the government-sponsored enterprise had precipitated much of the damage to the nation’s housing by establishing the practice of securitizing mortgages; that is, bundling them into bonds for sale in worldwide bond markets.

Sonoran News The practice severed the personal relationship between mortgagees and mortgagers that had existed previously and had kept borrowers and lenders from becoming greedy imbeciles. 

The half-finished house sat for two years, slowly deteriorating in the elements and becoming an eyesore in the upper-income neighborhood.  A couple of months ago it was sold and razed in preparation for a smaller home to be built in its place.  The lot is once again vacant and devoid of any evidence that homes had stood there.


BANKERS ARE TAGGED BY COURT WITH “UNCLEAN HANDS” AND MORTGAGE IS ADJUDICATED “VOID AB INITIO” 4closureFraud This case gives you an idea of how the courts view forged documents and even cites to case law from the 1800s: “[t]here can be no such thing as a bona fide holder under a forgery, whose good faith gives him any rights against the party whose name has been forged or his heirs.” Id. (quoting Austin v. Dean, 40 Mich. 386 (Mich. 1879)). As a result, the deed and subsequent transactions based on the deed “are void and should be set aside . . . .”



In re: Bowen v. MERS, Bank of New York Mellon Leagle While MERS admittedly holds more than a mere possessory interest in the Mortgage, it lacks the authority to act without direction from the note holder or servicer in light of its nominee status. In this way, MERS is simply a conduit. Therefore, the Defendants are entitled to judgment as a matter of law


The Victorian injustice system Independent Australia This case has gravely significant implications about the state of justice in Victoria. We urge you to read the story and express your support in the comments after the piece for the doughty and fearless Tess Lawrence as she continues to fight against her persecutors. Without our diligent efforts to redress the root causes of such injustice, what has happened to Tess Lawrence can, of course, at any time, happen to any one of us.

New York’s Highest Court Holds That Common Law Causes Of Action Are Not Preempted By The Martin Act 

May require free sign-up

mondaq New York's Court of Appeals issued a groundbreaking decision holding that a plaintiff's common-law claims for breach of fiduciary duty and gross negligence against a securities firm were not preempted by the Martin Act—New York's "blue sky" law.

"Intentionally perpetuating a fraud on the courts"

David Stern Investors Admit Foreclosure Documents Were Forged

The Complaint

FDL Defendants were at all times well aware that DS Law and the Target Business were intentionally perpetuating a fraud on the courts by, inter alia, systematically filing forged documents, forging signatures on such documents, fraudulently backdating documents, improperly notarizing and witnessing documents, fabricating documents, signing affidavits without reviewing or verifying the information contained therein, prosecuting foreclosure cases without obtaining proper service of process, and filing foreclosures with inaccurate and/or incomplete documents.

Standing Up for Consumers

Obama appoints Cordray as Director of the Consumer Financial Protection Bureau

Huff Post With a Director, the CFPB can exercise its full authorities -- with respect to both banks and nonbanks -- to help those markets operate fairly, transparently, and competitively.

Bank of America Loses Ruling Against MBIA in Fight Over Loans Bloomberg Bank of America lost a ruling in a court fight against MBIA Inc. (MBI) that will help the bond insurer as it tries to recover losses on home loans made by the bank’s Countrywide Financial unit.
MBIA, which says it was duped into guaranteeing payment on Countrywide mortgage bonds, needs only to show the lender made misrepresentations about the loans backing the bonds, instead of establishing they caused the losses the insurer is seeking to recover.

Wegelin Bankers Indicted by U.S. in Tax Crackdown, Bank Says

“Some bankers are cooperating with the Justice Department and turning over the names of their customers, and it’s possible that these bankers may do the same,” Skarlatos said.

Bloomberg Switzerland’s Wegelin & Co. said three bankers were charged with conspiring to help U.S. clients hide more than $1.2 billion from American tax authorities.

The case is U.S. v. Berlinka, 12-cr-00002, U.S. District Court, Southern District of New York (Manhattan) 


Foreclosure lawyer David J. Stern sued by his old company

DJSP Enterprises Inc said Stern, a former chief executive, concealed that his law firm David J. Stern PA inflated revenue by systematically "cutting corners" in the foreclosure process.

Thomson Reuters David J. Stern, who became one of the country's best-known foreclosure lawyers before shutting his business under regulatory pressure, has been sued for fraud by the publicly traded company he helped create to take on his now-defunct law firm's back-office operations.
1/4/12 Don't become a victim of a mortgage modification scam

Homeowners struggling to make their mortgage payments should beware of con artists and scams that promise -- for a fee -- to help them lower their debt or save their homes from foreclosure

Detroit Free Press You can apply for the government's Home Affordable Modification Program (HAMP) on your own or with free help from a housing counselor approved by the U.S. Department of Housing and Urban Development. Applying for HAMP is always free.

Late foreclosure filing not grounds for dismissal: NY court

U.S. Bank, N.A. v Guichardo

There was no pattern of willful noncompliance with court orders on the part of the plaintiff, and the Supreme Court gave no warning that the failure to submit the requested affirmation within 60 days would result in the dismissal of the complaint and cancellation of the notice of pendency. 


Home Equity Theft Reporter

Schack directed the firm to submit an affirmation that it was not simultaneously representing both U.S. Bank and MERS in the case. Schack's order gave the Baum firm 60 days to comply with the request.

It took roughly six months for the Baum firm to submit the required affirmation, according to the ruling. Citing the missed deadline, Schack ordered that the entire case be dismissed and the notice of pendency filed against the property in question be cancelled.
1/3/12 Homeowners buy back own property, dodge taxes

Paying property taxes has become optional for a growing number of Detroit landowners using a legal loophole to wipe away debt by buying back their properties in foreclosure

Detroit News As the city nears financial collapse, owners erased at least $4.7 million in property taxes and liens this fall on more than 400 properties Wayne County appeared to sell back to them for pennies on the dollar

NY judge gives bond insurers many routes to MBS recovery v. BofA

Includes links to documents

Thomson-Reuters The key question before Bransten was whether the insurers would also have to show that Countrywide's alleged misrepresentations were the direct cause of the MBS failures for which insurers had to pay out policy claims. And on this issue, the judge sided squarely with the monolines. "No basis in law exists to mandate that MBIA establish a direct causal link," she concluded.
1/3/12 California Agencies Warn Consumers About Mortgage Fraud National Mortgage News As 2012 begins, the California Department of Real Estate is still warning consumers to be wary of promises for loan modification, mortgage relief and foreclosure rescue scams as fraudsters to continue prey on vulnerable, financially stressed homeowners.

Aurora Class Action

Photo-Shopped Assignments and Systemic 131g TILA Violations


JPMorgan sued for $95 million over mortgage securities

It is one of many lawsuits seeking to hold banks responsible for investor losses over mortgages that may have been toxic, defective or improperly underwritten.


Yahoo! The PSA requires Defendant EMC Mortgage to furnish Mortgage Loan files upon request from Plaintiff Bear Stearns. Plaintiff has requested additional Mortgage Loan files so Plaintiff can investigate the
full extent of Defendants' breaches. Defendants have failed to provide those files.

Notice Of Summons in Bear Stearns Asset Backed Securities Trust 2005-4 v. EMC Mortgage Corp et al, New York State Supreme Court, New York County, No. 650003/2012.


Brown Calls for End to Free Pass for Banks that Abandon Foreclosed Homes

Brown Urges Agency to Take Action to Prevent Needless Evictions of Ohio Families and Neighborhood Blight

At Brown’s Urging, a Federal Investigation Revealed That “Bank Walkaways” Undermine Neighborhoods and Property Values, Leave Communities on the Hook for Maintenance

RealEstateRama “Too many Wall Street banks are walking away from too many Ohio Main Street communities,” Brown said. “And when they do, they leave behind homes that are often vandalized and left to crumble. Ohioans are seeing their property values plummet as abandoned homes on their block or in their neighborhood are left to decay or stripped of anything of value. Meanwhile, cities and counties are left footing the bill for banks’ irresponsibility.

FHFA MBS cases about to heat up Alison Frankel U.S. District Judge Denise Cote of Manhattan federal court, who's now overseeing all but one of the FHFA MBS suits, has put the litigation on a fast track. And UBS, the first defendant FHFA sued, has already teed up a dismissal motion based on an obscure issue that could decimate the FHFA's cases against every defendant.

State AGs and the private plaintiffs' bar: a paradigm shift? Alison Frankel In a little-noticed Dec. 27 order, U.S. District Judge Victor Marrero of Manhattan federal court granted preliminary approval to the settlement of antitrust class action claims that Wachovia rigged auctions for guaranteed investment contracts tied to municipal bond proceeds.

Squires v. BAC Home Loans

BAC Home Loans tried to get the complaint dismissed on various grounds. However, the district court shot down every single one of their grounds for dismissal. Interesting read.

Alabama Chief District Judge WILLIAM H. STEELE


This is very interesting TILA case alleging violation of §1641(g)(1) which is notice of the sale or transfer of a loan from one entity to another. Under this section, the new owner has 30 days in which to notify the borrower that the loan has been sold or transferred. 

Cappuccio v. Prime Capital Funding 3rd Circuit Court of Appeals The 3rd found this jury instruction in error and opined that under long-standing federal interpretation of TILA, the signing of the Notice of Right to Cancel creates a rebuttable presumption that the notices were actually given. The 3rd further opined that the evidence required to rebut the presumption is minimal and can be self-serving testimony.

Catalyst Arrives: MBIA Wins Summary Judgment Against Countrywide; Bad News For Bank of America

Decision in MBIA v. Countrywide

For more see: NY judge gives bond insurers many routes to MBS recovery v. BofA

Zero Hedge This is also the judgment that will make Bank of America's case law life a living nightmare going forward (naturally following repeated failed attempts at appealing). Lastly, any and all shorts in the name may have their work cut out for them.

1/2/12 In Mortgage Crisis, Some Banks Agree To Cut Losses NPR There's an unfamiliar trend emerging in America's troubled housing market: Big banks are volunteering to lose money — hundreds of millions of dollars for themselves and investors — in order to save homes at risk of foreclosure. And they're doing it in record numbers.

Largo man nearly loses his home over $.80 cents

The bank? Bank of America

Tampa Bay Online Imagine having the chance to save your home from foreclosure and then lose it all because you hit the wrong button on a telephone.


Also see comment section

Neil Garfield

Living Lies

Connecticut is one of the last states to confront the deluge of foreclosures so they are behind the curve. The usual evolution is that pro se litigants and lawyers who have little experience in litigating, much less litigating securitized loans, present arguments that immediately run against the grain of the sitting Judge. 

Another Eviction based on a FRAUDULENT Assignment

American Home Mortgage Servicing, Sand Canyon Corporation and Kathy Smith as VP for several companies. Soundview Home Loan Trust, 2007-OPT2, Wells Fargo Bank, N.A.

Impressive work byLynn Szymoniak Esq.

Fraud Digest

What the banks can expect in 2012.

For all of the reasons set forth above, Wells Fargo and AHMSI should immediately cease their attempts to seize the Tehiva/Phillips home. Wells Fargo should be required to produce the perjuring Kathy Smith in court in Hawaii and to produce the records of the trust showing that the trust acquired the Tehiva/Phillips mortgage in 2010 as represented by Smith. 

1/1/12 Michael Olenick: Is Shadow Housing Inventory Vastly Larger Than Widely Believed? 

The turn of the year is the time to make predictions and projections. I’m optimistic that the tide will finally turn for the American middle-class, suffering silently in a one-sided economic war.

nakedcapitalsm One challenge when performing any type of analysis is that information is scattered in many different places, and even when disseminated by the government its accuracy is oftentimes questionable. We’ve already seen existing home sales for recent years revised downward from their already dismal position, with barely a yawn from the public and no accountability whatsoever from government regulators who used that information when more reliable sources existed.

Max Gardner's New Years Message


The torch is in the air and like it or not, we are the only ones left to catch it!

An Essay by Max Gardner This is not just about the unrepresented consumers or about the judges and trustees we deal with every day but about saving our system of justice and due process from the unprecedented level of fraud and the endless lies of the creditors and their lawyers. In short, it is time for us to clean up the biggest national crime scene in the history of these United States of America. Law and Order must be restored and our system of just must be preserved. 
January 2012

Whistleblowers The New CFPB Welcomes Them!

Thomas Hudson A recent Consumer Financial Protection Bureau announcement caught my eye. It seems that the Bureau is soliciting information from whistleblowers and other knowledgeable sources about potential violators of federal consumer financial laws.
January 2012 Joseph Stiglitz: “A Banking System is Supposed to Serve Society, Not the Other Way Around” Vanity Fair Forget monetary policy. Re-examining the cause of the Great Depression—the revolution in agriculture that threw millions out of work—the author argues that the U.S. is now facing and must manage a similar shift in the “real” economy, from industry to service, or risk a tragic replay of 80 years ago.
12/31/11 The Frauds of Wells Fargo Were Warned of 100 Years Ago

The Assignment of Mortgage is the most telling document and is not readily available to the borrowers because it is not filed under their name – you need a recordation search. And if you don’t know it exists – its hard to find something you don’t know about. Assignments are usually fabricated right before the foreclosure notice.

Deadly Clear “This [Federal Reserve Act] establishes the most gigantic trust on earth. When President Wilson signs this bill, the invisible government of the monetary power will be legalized….the worst legislative crime of the ages is perpetrated by this banking and currency bill.” - Charles A. Lindbergh, Sr. 1913
12/31/11 A New Theory of the Role of the GSEs in the Housing Bubble Prof. Adam Levitin According to Black, the GSEs' involvement in nonprime mortgages grew out of their earlier accounting scandals. Black sees these scandals as the result of efforts to increase executive compensation.
12/31/11 Milford executive councilor leading the way to taking a closer look at foreclosures in area

They had said I was three months trailing, but I was making the payment on time. I made eight payments and the number eight payment they returned it, and said my house was going to be in foreclosure,” Casterguay said.

American Home Mortgage Servicing and Wells Fargo are involved.

Nashua Telegraph Executive Councilor David Wheeler, R-Milford, has championed their case and gotten state prosecutors and federal authorities involved to examine the issue more closely.

"There is more than a mortgage problem on the face of it; this could be a fraud or forced foreclosure phenomenon of epic proportions,” Wheeler said. “This is hard to watch.”


Decided 12/15/11

This is a great Best Evidence Rule case.

Deutsche Bank v. Day - NY Suffolk County

Motion for summary judgment filed by Deutsche Bank is DENIED for the following reasons:

Judge: Arthur G. Pitts

New York

I) An affidavit of merit from the plaintiff or, if the plaintiffs office submits an affidavit made by a servicing agent or attorney-in-fact for the plaintiff, then any renewed application must also be supported by a copy or the recorded limited power-of-attorney document and relevant excerpts of the servicing agreement. Without a properly offered copy of a recorded or certified power-of-attorney document or an affidavit from an officer of the plaintiff itself, the Court is unable to ascertain whether or not a plaintiffs servicing agent, for example. may properly act on behalf of the plaintiff to set forth the facts constituting the claim, the default and the amounts due, as required by statute. In the absence of either a verified complaint or a proper affidavit by the party or its authorized agent, the entry of judgment by default is erroneous. 


Florida AG Bondi to appeal court ruling that shields attorneys from foreclosure fraud investigations

To read Bondi's motion, click here.