Daily News related to the Foreclosure Crisis

The biggest unpunished heist in human history - Max Keiser


2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1990's
January | February | March | April | May | June | July | August | September | October | November | December
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.
Articles |The FORUM |Law Library |Videos | Fraudsters & Co. |File Complaints |How they STEAL |Search MSFraud |Contact Us



Articles are added several times a day 





The Judge denied the Motion without explanation. When he was questioned by Mr. Barnes as to the reason for the denial (so that a proper record could be made for appeal purposes), the Judge responded by saying “I don’t have time to explain that; I have a whole courtroom of people here. Goodbye.”

Jeff Barnes, Esq. What needs to happen is that petitions to the rules committees need to be made, and demands need to be made to the various state legislatures to enact statutes precluding a Judge from refusing to honor agreements of the very attorneys on the case which agreements are designed to, for example, try to settle a case through a loan mod. If all states had anti-dual tracking statutes as California and Hawaii do (which prohibit maintaining or advancing a foreclosure case if the homeowner is in loan mod negotiations), a lot of this nonsense would probably be avoided. High time the other states smell the coffee and start protecting the interests of the very people who elect the legislators to begin with.


Texas Court of Appeals believes MERS can transfer Notes, even though MERS never holds the Note. 

Shamel v. Specialized Loan Servicing

TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN It has been widely held by courts in various jurisdictions that MERS cannot transfer a Note because MERS never holds the Note. Apparently, Texas courts don't know this. Here, the Texas COA wrote: "MERS (“as nominee for CitiMortgage”) later assigned the note and security instrument to Arch Bay Holdings".

If you don't properly challenge the assignments and negotiation - you lose! 


Moody's Downgrades Ocwen Servicer Rating, Citing Regulatory Risks

Mortgage Servicing News Moody's Investors Service on Friday downgraded two servicer ratings for Ocwen Loan Servicing due to increased regulatory scrutiny and concerns about the its ability to ensure timely payments to bondholders.


HARP's Image Problem

I think any time a government official has to explain that a government program is "not a scam," it's sort of comical - but at the same time, sort of disturbing, because it could be interpreted to mean that the public's distrust of government programs is on the rise.

Mortgage Orb During a recent interview, Watt told another media outlet that part of the reason HARP participation rates are lower than expected is because "people don't trust their lenders."

But when one visits the HARP website to find out how to get a HARP loan, the site basically instructs you to "contact your lender first" - which is interesting when you consider that the government is directing borrowers right back to the very same entities which Watt says they "don't trust."

I would argue that part of HARP's problem is not just that people don't trust their lenders - they don't trust the government, either.

Condo Must Pay For Causing Dog's Eviction.

A condo association must pay $5,000 in damages, plus $127,000 in attorneys' fees, for insisting that a veteran with PTSD get rid of his emotional support dog.

Bhogaita v. Altamonte Heights Condo Assoc.

Home Equity Theft Reporter "Bhogaita produced evidence from which a reasonable fact finder could conclude that his dog alleviated the effects of his PTSD. Specifically, Dr. Li's letters said that Kane assists Bhogaita 'in coping with his disability,' and 'ameliorate[s]' Bhogaita's 'psychiatric symptoms,' and that without the dog, Bhogaita's 'social interactions would be so overwhelming that he would be unable to perform work of any kind,'"


DOJ To Give Money From Bank Of America Settlement To Liberal Activist Groups

Daily Caller This is a wealth redistribution scheme disguised as a lawsuit,” Tom Fitton, president of Judicial Watch, told The Daily Caller. “And who benefits from the distribution? Interest groups the administration relies on, outside interest groups, allies and politicians in communities trying to benefit as well.”

Fitton noted that these liberal groups are basically what’s left of the Association of Community Organization for Reform Now (ACORN) network, and that President Barack Obama has ties to ACORN.


Holder in Due Course and Due Process

On the one hand they want to be seen as a holder with rights to enforce but on the other hand they don’t want to disclose, allege, assert, or prove the foundation or source of the right to enforce.

The only element left for a holder in due course is the purchase for value. Since there is no allegation that the trust is a holder in due course, the bank is admitting that the trust never purchased the loan.

Living Lies If the burden is placed on the borrower, it would be the equivalent of a murder on video in possession of the murderer but the State and the heirs of the victim are charged with proving the case without the video. The facts suggest here that the Trust paid nothing because it had no money to pay for a loan. The facts suggest that if it were otherwise, the Trust would have paid for the loan and be most anxious to plead HDC status. And thus the facts show that the foreclosing party cannot claim the right to enforce based upon a presumption without violating the due process rights of the homeowners here. Only the foreclosing party and its co-venturers have in their care, custody and control, the necessary information to refute or prove the facts behind the presumptions they are attempting to raise.

Florida Activists Help Remove Terrible Foreclosure Judge  :-)

Lewis basically embodied the concept that homeowners with arrears are automatically deadbeats, and that the actual procedures of law establishing property rights, existing for over 300 years in America, meant absolutely nothing. There’s not even the semblance of impartiality here; foreclosure cases simply move to final judgment by default. Not to mention that she was boorish, rude, and dismissive of people simply trying to have their day in court. Here are a series of testimonials – the words “vile,” “despicable” and “disgrace” frequently crop up.

David Dayen Lewis comes from a political family; her father was a state senator with a focus, paradoxically, on homelessness. There’s a homeless facility in the area with her father’s name on it, and the running joke among the legal community is that his daughter kept it well stocked. 

One judicial election certainly does not make up for the outrage and human tragedy that has defined this foreclosure crisis era. But it feels good to see some measure of justice prevail, at least by subtracting one of the worst of the worst in bank-loving judges. It does show that the spirit of the movement that gave its best shot at forcing accountability on the most powerful forces in America remains alive. They may have gone local, they may be focused on small and unheralded issues, but they can still pack some force. Just ask ex-Judge Diana Lewis.


Judicial Conduct Comes Full Circle

So if you think a judge is unfair in foreclosure cases or, frankly, any type of case, guess what? Judges are elected officials. If it’s really that bad, then gather up public support, wait for the next election, and vote for the competitor! That’s basically what happened in the Ticktin/Lewis race, and that’s probably why Ticktin won.

Stopa Law Judicial accountability to the public is a significant reason why many lawyers believe the senior judge system in Florida doesn’t work. You see, unlike normal, sitting circuit judges, senior judges do not get (re-)elected and, hence (at least arguably), have no accountability to the public at all. In other words, the senior judges have no fear of what happened to Judge Lewis, as they aren’t elected. That’s no disrespect to any particular senior judges whatsoever – I appear before senior judges nearly every day, and most try very hard to be fair and follow the law. That said, I think the results in Ticktin/Lewis reveal the importance of all judges, particularly in foreclosure court, being subject to re-election by the Florida public. So all of you who complain about judges, remember election day – that’s where you can make a difference.

Ohio's Tenth Circuit Denies Motion to Vacate in..

BONY v. Williams

Ohio Tenth Circuit COA The Williams' argument falters because lack of standing does not render a judgment void.

Lack of jurisdiction over a particular case merely renders a judgment voidable, not void.

Boomer Wealth Dented by Mortgages Poses U.S. Risk

“There were old-fashioned beliefs probably 30 years ago that  you should pay off your house before you retire. This is no longer the case.”

Bloomberg A growing number of homeowners are reaching retirement age still owing money on their houses. The share of Americans 65 and older with mortgage debt rose to 30 percent in 2011 from 22 percent in 2001.


DOJ's Latest Alternative to Prosecution

First it was mostly civil fines and penalties. Then came deferred and nonprosecution agreements (DPAs and NPAs) that really took off in the past decade. Now there's a new development: the "restitution and remediation agreement" (which we'll call, ahem, R&R).

Corporate Counsel The first lucky recipient of an R&R was SunTrust Mortgage Inc., which agreed on July 2 to pay nearly $1 billion to state and federal agencies to avoid criminal prosecution in how it handled mortgage modifications using funds under the Troubled Assets Relief Program (TARP).
The deal clearly states on page 5 (of 11 pages) that unless SunTrust breaches the agreement, the government will not bring any charges against the mortgage company. But the government reserved the right to pursue charges against individuals, "including current and former officers, employees and agents of SunTrust."


BOS discuss impact of MERS on county records

District 3 Supervisor Denise Rushing requested the issue be placed on the agenda after hearing from several local residents during public comment at previous meetings regarding the unlawful foreclosures.

"It affects a lot of seniors," Larry Anderson, 76, of Kelseyville said. "What MERS is doing is proven fraud."

Record Bee The system is a national database of home mortgages that allows lenders to bypass county recorders in order to more easily transfer mortgage rights, according to County Counsel Anita Grant. The system tracks mortgage loans and servicing interests, but it appears MERS may not be recording all additional mortgage assignments.

"There are a number of issues relating to MERS, including but not limited to whether MERS has standing to conduct foreclosure actions and whether the avoidance of recording fees is unlawful," Grant said.


New York AG Goes After More Mortgage Relief Firms

The suit was filed against entities the AG felt were operating a fraudulent loan modification scam.

There has to be one set of rules for everyone, no matter how rich or powerful, and that is why our office has aggressively cracked down on those who prey upon vulnerable consumers at risk of losing their home,” said Attorney General Schneiderman. “I am proud to stand up for middle class New Yorkers against predatory scammers seeking to exploit those still reeling from the housing crisis.” AG press Release

Huff Post Yesterday the New York Attorney General secured a temporary restraining order barring the, Home Affordable Direct, Inc. (Farmingdale, NY), Home Affordable Solutions, Inc. (Farmingdale, NY), JR Holding Group Corp (Babylon, NY), Clear Solutions and Settlements, Inc. (Tampa, FL) and their principals, Javier Gutierrez and Shadi Soumekh, from collecting illegal advance fees from homeowners before they accept and execute a loan modification agreement and advertising and operating their business without providing the disclosures required by the federal Mortgage Assistance Relief Services (MARS) Rule. The court also placed a freeze on company bank accounts.


Owner and Seven Employees of Mortgage Company and Two Real Estate Developers Indicted for $50 Million Scam Involving Federally Insured Mortgages

eNews Park Forest According to the indictment, beginning in January 2006 and continuing through September 2008, Hernandez and others allegedly obtained mortgage loans insured by the Federal Housing Administration (FHA), a division of HUD, for unqualified borrowers by exaggerating the borrowers’ income and otherwise misrepresenting their financial condition.


Maine Supreme Court addresses MERS assignments and payoff amounts during cure periods

Assignment from MERS May Only Transfer Right to Record Mortgage

Bradley Arant Boult Cummings LLP Since the note was endorsed in blank and BofA had possession of the note, the Maine Supreme Court held that BofA met the first prong of the standing test. However, the court found that BofA failed to establish the second prong of the test, ownership of the mortgage.

When MERS then assigned its interest to BAC, the court held that it granted BAC only the right that it possessed, the right to record the mortgage as nominee for the lender.


Proposed Bill Limits Foreclosures to Record Holder of Mortgage

New Jersey Law Journal A bill that has begun making its way through the legislature would limit the ability to bring mortgage foreclosure actions, allowing them to be filed only by the holder of record.

Any borrower who is not given correct information and misdirects a mortgage payment would be off the hook. The servicer would have to track down whoever was paid in error and try to collect from them.

Flagstar mortgage servicing settlement with CFPB imminent

Bank holds little to no reserve for issue...

Housing Wire The bank previously provided the CFPB with documents and other information concerning its loss mitigation practices and default servicing operations in response to Civil Investigative Demands received from the bureau. 


SHAREHOLDER ALERT:  Class Action Against Ocwen Financial Corporation and Its Board of Directors and a Lead Plaintiff Deadline of October 13, 2014 


If you suffered a loss in Ocwen you have until October 13, 2014 to request that the Court appoint you as lead plaintiff.

Levi & Korsinsky, LLP  A class action lawsuit has been commenced in the United States District Court for the Southern District of Florida on behalf of investors who purchased Ocwen Financial Corporation ("Ocwen" or the "Company") (OCN) common stock between May 2, 2013 and August 11, 2014.

The complaint alleges that throughout the Class Period defendants misrepresented and/or failed to disclose that: (a) Ocwen's mortgage servicing practices violated applicable regulations and laws; (b) the Company's executive allowed Altisource Portfolio Solutions, S.A. ("Altisource"), a related company, to impose unreasonable rates for services provided to Ocwen; and (c) that the Chairman and other directors and officers were directly involved in approving Ocwen's conflicted transactions with Altisource.

Amicus briefs are welcome.

Docket: California Supreme Court Grants Petition for Review in YVANOVA v. NEW CENTURY MORTGAGE

Chin, J., was recused and did not participate.

California Supreme Court The petition for review is granted. Briefing and argument is limited to the following issue (see Cal. Rules of Court, rule 8.516(a)(1)): In an action for wrongful foreclosure on a deed of trust securing a home loan, does the borrower have standing to challenge an assignment of the note and deed of trust on the basis of defects allegedly rendering the assignment VOID?

Appellant's brief in: Patidar v. Bank of America-Fannie

Court OPINION - Affirmed

Texas 14th COA Defendant BOA refused to accept payment in June, 2010. Defendant BOA did not apply the $45,000 insurance proceeds to repairs of Plaintiffs home or delinquencies on their mortgage payments. Defendant BOA is holding Plaintiffs $45,000 insurance proceeds as income, not applied to repairs or mortgage of Plaintiffs’ home. Court allowed foreclosure.

Attorney Talks Foreclosures

WTNH The floodgates of foreclosure have opened again. People believe that if they are applying for a modification that foreclosure is a suspended myth. He explains the difference between medication and mediation. He also discusses how a foreclosure can be stopped and if bankruptcy is the answer.


Short and Simple:

HSBC v. Gilbert

Appellate Division, Second Judicial Department  The plaintiff failed to demonstrate its prima facie entitlement to judgment as a matter of law, because it did not eliminate triable issues of fact regarding whether it had standing as the lawful holder or assignee of the subject note on the date it commenced the action 


Foreclosure-Mill Morris Hardwick Schneider partner accused of stealing $30M

Atlanta Business Chronicle Additionally, MHS banking records reflect Hardwick directed nearly $6.3 million to Divot Holdings LLC, which was controlled solely by Hardwick, nearly $1 million to pay providers of private jet services, nearly $645,000 for payment of losses Hardwick suffered in connection with failed property investments, and nearly $4 million in wire transfers to casinos.

2008: Worse than the Great Depression

Q13 Fox Ben Bernanke, the former head of the Federal Reserve, said the 2008 financial crisis was the worst in global history, surpassing even the Great Depression.


Appellate Court Orders Surplus Sale Funds to Homeowner

Dever v. Wells Fargo

The circuit court ordered the surplus to 
be disbursed to Wells Fargo, and the Devers appealed. We reverse and remand for the circuit court to order the surplus disbursed to the Devers. 


Alleged mortgage relief scammer nabbed at wedding

Chicago Tribune Bell, along with two others, was indicted last year on federal fraud charges connected with their operation of Washington National Trust, which promised assistance to Aurora-area homeowners struggling to pay their mortgages in exchange for fees of $5,000 and $10,000. But Washington National wasn’t licensed and wasn’t a trust.


Bank of America's Next Big Countrywide Problem

Most of the loans it has left probably cannot be sold, and working out problem loans — especially those at the bottom of the barrel — is notoriously slow and labor intensive

Mortgage Servicing News Bank of America has lost more than $60 billion on its acquisition of Countrywide, including the cost of last week's big settlement with the Justice Department. But its issues are hardly over. The pain will continue for years as it has hundreds of thousands of delinquent, unsellable mortgage loans to work through.


U.S. Loses Bid to Dismiss $25B Lawsuit Over AIG Bailout

Insurance Journal A federal judge has rejected the United States’ bid to dismiss a more than $25 billion lawsuit filed by Maurice “Hank” Greenberg, the former chief executive of American International Group Inc., over the insurer’s government bailout, clearing the way for a Sept. 29 trial.


Notice and Affidavit Fail


We further observe that the demand letter appended to Griffin’s affidavit is from America’s Servicing Company, and neither Griffin’s affidavit, which was made in her capacity as Vice President of Loan Documentation for Wells Fargo, nor the demand letter explains the relationship between Wells Fargo and America’s Servicing Company. Nor does Griffin indicate how Wells Fargo came to be in possession of the demand letter. Thus, it is unclear how Griffin could authenticate the letter or have knowledge of whether this letter had 
actually been mailed by America’s Servicing Company.



Deutsche Bank Fighting to Void Deal With 'Wrong' Homeowners

In an apparent case of mistaken identity, Deutsche Bank is hitting some roadblocks in its efforts to void a loan modification it claims resulted in a $125,000 discount on the wrong homeowners' outstanding mortgage.

Deutsche contends that the terms of the Lindseys' loan don't allow for modifications and that Ocwen signed the agreement on behalf of Wells Fargo, not Deutsche.

New Jersey Law Journal The couple also challenged Deutsche's claims that the modification was executed in error, pointing out that weeks-long periods passed between the December 2012 state court consent order, execution of the modification execution and submission of the agreement to the county clerk.
"How many 'mistakes' does the plaintiff want this court to accept?" the Lindseys said in their brief.
Also, Raymond Lindsey wrote in a June affidavit that he was "strongly encouraged to accept this settlement agreement by the attorney representing the plaintiff."
"In fact, the exact words said to my wife from the plaintiff's attorney was that we 'would be crazy not to accept this settlement,'" Lindsey said in the affidavit.


The Sorry State of Bank Apologies

There’s much work to be done to hold giant corporations accountable for their misdeeds.

The apology shouldn’t be an end, but a beginning.

ProPublica Some argue that corporate apologies are pointless and all that matters is the prosecution of executives and supervisors who oversaw the misdeeds. That may be too absolute an approach, but it is vital to charge individuals, especially those at the top. On this issue, the authorities continue to fail. The admissions and guilty pleas could be a path to investigations and charges against individuals. Instead, there is no sign that these will lead to charges against top officials and managers who were responsible for the crimes. Indeed, it’s the opposite.

Sacramento federal court jury acquits 4 in local mortgage fraud case

In an unprecedented trial, four people charged with mortgage fraud were acquitted Friday by a jury in Sacramento federal court after defense attorneys argued the real culprits are the so-calledvictim lenders.”

SacBee “Prosecutors have refused to criminally prosecute the elite bankers responsible for the mortgage crisis that decimated our economy. The jurors heard shocking testimony from ‘control fraud’ expert William Black that regular people who got loans they were unable to pay back did not (defraud) the banks. The elite bankers commit the fraud while prosecutors look the other way and prosecute the wrong people.


Disbarred Calif. attorney added to Florida homeowner scam suit

Palm Beach Post Philip Kramer ran The Law Offices of Kramer and Kaslow until August 2011 when California Attorney General Kamala D. Harris sued the firm and multiple connected entities for taking millions of dollars from homeowners through “fraudulent promises” of quick mortgage relief.

MBS Settlements--Following the Money

What's interesting is where the money has gone--and where it hasn't. As the graphs shows, the lion's share of settlement dollars has gone to the government and GSEs (both major enablers of the illegal foreclosure scams).

Prof. Adam Levitin Very little has been recovered by private investors and most of that is from the trustee settlements (rotten though the Bank of America-BONY settlement was). What's really astonishing is how little has been recovered in private securities litigation. The RMBS litigation settlements to date total $1.6271 billion. That's a quarter of what the monoline insurers recovered, even though most RMBS did not have bond insurance. 

Billions lost to fraud through lack of communication at Fannie, Freddie 

MPA The government’s mortgage finance giants could have saved taxpayers billions had they more effectively shared information about a massive fraud case, according to a new report.

REPORT: Lessons Learned


GSEs, Ginnie Overlooked 'Red Flags' in TBW Fraud Scheme: Watchdog

Fannie Mae, Freddie Mac and Ginnie Mae all overlooked warning signs about Taylor, Bean & Whitaker that make them partly to blame for the mortgage lender's multibillion fraud scheme.

National Mortgage Professional The report describes various "red flags" that allowed the fraud to continue for years though it could easily have been avoided.

For example, Freddie ramped up purchases of loans from TBW in mid-2002, even though Fannie had terminated its relationship with the lender after catching it double-pledging loans. Fannie also found that Farkas had personally taken out $2 million in loans to repurchase bad mortgages it had sold to Fannie, yet Fannie did not formally advise Freddie or its regulator of this.


The delays in foreclosure were often also attributable to the trusts and servicers themselves and their default management decisions. Trusts and servicers frequently selected just a few law firms to handle their foreclosures and paid these firms the bulk of their fees upfront, at the time the foreclosure was commenced, providing an incentive to file foreclosures, but not to complete the foreclosures.

THJF The cases were most often commenced without filing a copy of the endorsed note and mortgage assignments at the commencement of the action. This was done even though the Pooling and Servicing Agreements for most trusts specifically provided that the original, endorsed note and assignments were to be furnished to the servicer in the event of a default. The foreclosing law firms often substituted mortgage assignments made at the time of default for the original loan documents held by the document custodians of the trusts. These documents further clouded the legal standing of the trusts to foreclose, delaying the completion of the foreclosures.


Homeowner duped into giving away his  house, lawsuit says

Public records show, he gave the house to someone else.

Except that he didn't, Lupica says.

L.A. Times Lupica's attorneys say they do not know if "Mihran" was actually Grigoryan, or someone working with him. Whoever it was presented Lupica with blank or incomplete documents, which he signed in September and November, thinking they were related to the loan, the lawsuit states.

Instead, Lupica's signature wound up on forged papers that deeded his house to Grigoryan — for free.



Frustrated Detroit homeowner tries to give squatter the boot

It took one look at the lease and a phone call to the Texas company listed to figure out. The lease isn't valid.

WXYZ The renter told the homeowner she was the victim of a scam. She rented the home from some people she met on Craiglist and gave them $2500.

She wasn't willing to turn their information over to me.

For now, Detroit Police can't help the homeowner. It’s up to the courts to get the illegal tenant out.

But, Michigan's law is changing, in a month police will have the authority to help homeowners like Theresa.

Victory on Appeal – "Lack of Prosecution"

GARCIA v. BAC Home Loans

Post includes briefs from both sides.

Stopa Law Florida’s Fifth District Court of Appeal just reversed a Final Judgment of Foreclosure because the trial court improperly denied a motion to dismiss for lack of prosecution

Florida Rule of Civil Procedure 1.420(e) sets forth a two-step process by which courts must dismiss a lawsuit (any civil lawsuit, not just a foreclosure case) where the plaintiff has not been diligently prosecuting the case, and the Rule is pretty straightforward.

Overselling the Settlement

The only thing these settlements are meant to do is to extract a sum from the banks to settle particular claims having to do with specific activities, and then to allocate those funds in a way that is palatable to the banks and appealing to the government and, by extension, to the public.

New Yorker  (In the Bank of America deal, the claims being settled have to do with the bank misleading investors, not homeowners. But using some of the funds to help homeowners makes everyone look good.) The problem with this isn’t that banks’ relief efforts don’t have a wider scope; it’s that by describing the settlements in grandiose terms, banks and officials risk misleading the public about the scope, which, at best, can confuse people and, at worst, can set them up to fall victim to fraud.

Judge Rules Force-Placed Insurance Refunds for 400,000-Plus Borrowers

To receive compensation under the settlement, mortgage borrowers whose loans have been serviced by Citibank and who were subjected to force-placed insurance must submit a claim form by the end of the claim period, which remains open.

National Mortgage Professional The lawsuits alleged that Citibank and its force-placed insurance vendors, Assurant, Inc., American Security Insurance Company, and Standard Guaranty Insurance Company, unlawfully profited from force-placing insurance on borrowers' properties, including by arranging for improper kickbacks or so-called "commissions" to be paid to Citibank or its affiliates by the force-placed insurance vendors. The Casey lawsuit also alleged that Citibank increased the amount of force-placed flood insurance required for some borrowers in excess of their unpaid principal balance, in violation of borrowers' loan agreements.

Theft Law & Legal Definition

Generally, a person commits the crime of theft of property if he or she:

US Legal Knowingly obtains or exerts unauthorized control over the property of another, with intent to deprive the owner of his or her property;
Knowingly obtains by deception control over the property of another, with intent to deprive the owner of his or her property


Don't send them out to do your shopping.

Goldman to Buy Worthless Mortgage Debt for $3.15 Billion to Resolve FHFA Claims

The bank's cost could be lower than $1.2 billion if it's able to sell the securities garbage at a higher price than their current value. 

National Mortgage News Goldman Sachs had asked judge Cote in June to rule against the FHFA, saying that a U.S. Supreme Court ruling that month meant that the agency had waited too long to file the claims in 2011. The FHFA this month had cited an appeals court ruling that allowed the National Credit Union Administration to press securities cases against banks despite questions about time limits.


Homeowner help? Not from the states

New York is getting a portion of this week’s $17bn Bank of America fine, but it’s most likely to go to balancing the budget.

There’s a block in the funnel of money: neither states nor the banks have rushed to put money into the hands of homeowners. 

Homeowners, however, may be pardoned for not joining in the rejoicing. For many of them, the billions of dollars now being tossed around are simply impossibly large numbers – too big and far too late in the game to make a real difference in their lives

Guardian To each of the thousands, or even millions, of households devastated by the subprime lending crisis, smaller sums, steered their way far more promptly, might have been of much greater value. They might have been much more helpful for the broader economy as well.

The main issue is probably that these settlements have come too late to do any good – either to repair the damage done to homeowners or to teach banks a lesson. For years, banks resisted taking responsibility for the crisis, squandering the opportunity to rebuild trust in their brands and to move forward with a clean slate, putting fines, sky-high legal bills and other crisis legacies behind it. Instead, they dragged their heels, until at last they have grudgingly forked over record settlements that won’t satisfy anyone on the receiving end. The biggest problem? The time that they wasted has only hurt homeowners more.


You Thought the Mortgage Crisis Was Over? It's About to Flare Up Again

David Dayen A series of temporary relief measures and legacy issues from the crisis will begin to bite in 2015, causing home repossessions that could present economic headwinds. In other words, the foreclosure crisis was never solved; it was deferred. And next year, the clock begins to run out on that deferral. 

Government Gone Wild: Bank Of America Settlement Will Prolong Next Financial Crisis

This sort of settlement scores a lot of points for populist politicians who are always looking to gain favorable publicity and it really satisfies the public's demand to punish the big evil banks for losing money by giving money away. But there's a bit more to the story.

Chicago Now It's not at all clear that Bank of America is strictly liable and apparently there have been numerous intermediate court decisions that absolved them of responsibility. 

As much as I hate Bank of America for being inept in handling my company's financial matters this settlement just seems wrong. I think it's obvious that the next time the government needs the private sector to bail them out of a problem they're either going to be turned down or required to throw in all sorts of guarantees.

August 2014


This heartbreaking scenario has gained national attention in recent years

Reverse Mortgages: Recent Developments for Surviving, Non-Borrowing Spouses


California Homeowner Bill of Rights Collaborative An impending foreclosure can compound a widow or widowers’ grief and devastation after losing his or her spouse. This heartbreaking scenario has gained national attention in recent years for its prevalence among older homeowners with reverse mortgages insured by the Department of Housing and Urban Development (HUD). In the
past year, two somewhat high-profile cases, Bennett v. Donovan and Plunkett v. Donovan, have shed light on what happens to surviving, non-borrowing spouses once their partner, who borrowed the reverse mortgage alone, passes away.
White paper

Should the Mortgage Follow the Note? 

Prof. John Patrick Hunt The law of mortgage assignment has taken center stage amidst foreclosure 
crisis, robosigning scandal, and controversy over the Mortgage Electronic Registration System. Yet a concept crucially important to mortgage assignment law, the idea that “the mortgage follows the note,” apparently has never been subjected to a critical analysis in a law review. 
This Article makes two claims about that proposition, one positive and one 


Goldman to pay $3.15 billion, its largest ever bill, to settle mortgage claims 

Goldman sold junk to Fannie and Freddie because of the government "guarantee" backed by taxpayer wallets. Then they illegally kick people out of their homes to make more money and cover-up the fraud... and nobody goes to jail?

Economic Times Lawyers for the housing agency presented new evidence that Goldman was aware of weaknesses in the subprime mortgage market - and was placing bets against it - but did not pass on that information to the clients buying subprime bonds.

"Goldman Sachs promptly established massive and lucrative short positions in mortgage-related securities while continuing to sell such securities to investors without disclosing its true assessment of the underlying loans." 


An Unfinished Chapter at Countrywide

Is Angelo R. Mozilo in the cross hairs again? (He should be!)


It is unclear, of course, if prosecutors will indeed take action against Mr. Mozilo, who is 75. In 2011, the Justice Department "mysteriously decided" to drop a criminal case against the former executive after a two-year investigation.

Gretchen Morgenson NY Times The possibility of a new case against Mr. Mozilo came almost exactly seven years after the subprime mortgage machine he created and oversaw began to sputter and stall. That process began in earnest on Aug. 16, 2007, when the company disclosed that it was drawing down its entire $11.5 billion revolving credit line. Other lenders had lost confidence in its operations.

That was the beginning of the end for Countrywide. It was bought the next year by Bank of America in the single worst corporate acquisition ever. Bar none.


We reverse the trial court’s orders sustaining without leave to amend 
Wells Fargo’s demurrers to plaintiffs’ wrongful trustee sale and quiet title causes of action to the extent these causes of action seek the equitable cancellation of the trustee sale. We affirm the remainder of the trial court’s orders sustaining Wells Fargo’s and 
First American’s demurrers. We vacate the trial court’s denial of plaintiffs’ request for a preliminary injunction


h/t Stop Foreclosure Fraud

We conclude that plaintiffs have pled viable causes of action for the equitable cancellation of the trustee’s deed obtained by Wells Fargo based on their allegation that Wells Fargo did not comply with the NHA requirements incorporated into the deed of trust. Because compliance is a condition precedent to the accrual of Wells Fargo’s contractual authority to foreclose on the property, if, as plaintiffs allege, the sale was conducted without such authority, it is either void or voidable by a court sitting in equity. 


Bank settlements won't deter Wall Street wrongdoing

The reason why is simple: 

CBS Money Watch Although the government has outlined numerous instances where bankers knowingly misled investors about the riskiness of the loans that were bundled into securities, those individuals have largely escaped any punishment. Given the magnitude of the settlements the banks reached, many experts believe that future criminal prosecutions are unlikely, although the civil settlements don't necessarily preclude them.


CFPB Selects Vendors And Lenders For Its Mortgage E-Closing Pilot

To view the CFPB's e-closing pilot guidelines, click here.


Mortgage Orb The main difference between an e-closing and a traditional, paper-based closing is that the documents used in an e-closing are in electronic format and the parties involved no longer need to be physically in the same room (at the "closing table"), as they can now interact and collaborate via real-time communications, such as video conferencing, and share documents via the Internet.

Vendors participating in the e-closing pilot include Accenture Mortgage Cadence; DocMagic, Inc.; eLynx; Pavaso, Inc.; and PiersonPatterson, LLP. Creditors involved in the pilot include Blanco National Bank; Boeing Employees Credit Union; Franklin First Financial, Ltd.; Flagstar Bank; Mountain America Credit Union; Sierra Pacific Mortgage; and Universal American Mortgage Co.


Lessons Not Learned

The S.&L. crisis could have helped us avoid the financial crisis.

In 1982, Congress passed the Garn-St Germain Depository Institutions Act — which St Germain wrote with Edwin “Jake” Garn, the Republican senator from Utah — which essentially deregulated the industry, allowing S.&L.’s not only to pay market interest rates, but to make loans far afield from home mortgages.

Joe Nocera The idea was that S.&L.’s needed to be able to make more profitable loans since they were going to be paying much higher interest rates to gain deposits. What nobody seemed to realize was that financial deregulation was bound to have unintended consequences. S.&L.’s went from being the most cautious of financial institutions to the most heedless. S.&L. operators dove into all kinds of exotic areas. By the late 1980s, it had all come a cropper; ultimately more than 1,000 S.&L.’s — one out of every three still operating in 1988 — went under. The industry’s collapse cost the taxpayers nearly $125 billion.


The Bank of America Settlement Agreement- The DEVIL IS in The Details!

Weidner Law

Are you facing Bank of America in a Foreclosure…will this settlement help you at all?

The full agreement is below…it is another sellout…

Where is the real relief for consumers?

How will citizens really benefit from this?


Few homeowners expected to benefit from Bank of America's $16.65B settlement

TribLive Bank of America's record $16.65 billion settlement for its role in selling shoddy mortgage bonds — $7 billion of it geared for consumer relief — offers a glint of hope for desperate homeowners.
The settlement requires the nation's second-largest bank to reduce some home­owners' (grossly over-priced by appraisal fraud)  loan balances, provide new loans to low-income buyers and address areas of neighborhood blight.


New York Process Servers Lose a Suit on New Rules

It is one of the basic elements of law: When you are sued, you have to be notified so that you can appear in court to defend yourself.

NY Times But New Yorkers were not always receiving the court papers, even though process servers were signing affidavits swearing that they had properly delivered them.

The problem — known as sewer service, for the process servers’ metaphorically dumping the papers in sewers — led to an amendment of a city law regulating process servers and the introduction of a set of rules based on that law by the Department of Consumer Affairs.


Full post

Superior Court Judge death ruled suicide

WMGT The Georgia Bureau of Investigation has completed an autopsy confirming the death of Superior Court Judge James L. Cline, Jr., was a suicide.

Cline shot himself in the chest at his home.

Cline was a judge on the Ocmulgee Judicial Circuit.

BofA Accused of Rolling USA for $900 Million

"In some instances, BANA/BAC added monies to the principal of modifications in a lump sum without any itemization of the amount financed, making it impossible for the borrower to discern what charges comprised the added principal."

Courthouse News The complaint was filed under seal in March in Manhattan Federal Court and unsealed this month.

Fisher claims to have reviewed hundreds of loan modification contracts from Bank of America and other lenders. He says he noticed a pattern of violations of the Truth in Lending Act.




Total Annihilation of a Bank Lawyer and Their Witness! Another Trial Win

Trial Transcript

Evan Rosen, Esq. Opposing counsel then shows me a pay history but it is really a conglomeration of four different types of printouts from two different companies. I tell the judge, to keep the record clear, let’s mark all four separately or as separate subparts of a composite. He agrees. Plaintiff’s attorney then begins to ask the four key business records exception to hearsay questions and she is stumbling. I object on personal knowledge, compound, confusing, and the judge is sustaining all of them at this point.

The Art of Objections at Trial: A Success Story

Rulings against the Plaintiff foreclosing party are becoming increasingly common. Discovery is being allowed and many cases are thrown off the rocket docket and into general civil litigation. And a properly framed objection to evidence is taken seriously and frequently sustained leaving the foreclosing party with nothing.

Living Lies These developments are especially important because many suits are being filed for deficiency judgments on foreclosures that were wrongful in the first place. 110 such actions were filed in Palm Beach County in the last month. Interestingly, the foreclosing party is NOT going back to the same Court in the same suit that was the foreclosure. They are filing separate actions. The Banks are afraid of providing a forum for the homeowner to challenge the assumptions that resulted in the foreclosure. Their fear is based in reality. The same Judges that were rubber stamping foreclosures are slowly changing their rulings as described by Rosen.


Bank of America Papers Show Conflict and Trickery in Mortgages

Documents released as part of the $16.65 billion settlement between Bank of America and the Justice Department read like a highlight reel of the mortgage sins that fed the 2008 financial crisis

Criticism From Countrywide Executive p.10 

$156,491 for a 24-Year-Old Mobile Home p.26

$312,204 for Unemployed Person Living Rent-Free p.27

DealBook One Bank of America employee describes trying to “trick” a system that screened mortgages that the Federal Housing Administration agreed to insure.

When using this system, Bank of America sometimes changed an applicant’s financial information and resubmitted the loan many times to try for approval. In at least one case, a Bank of America underwriter tried to pass the F.H.A. screening more than 40 times, according to the documents. In other cases, “underwriters regularly changed the relevant data and resubmitted the loans more than 20 times,” the documents said.

Bank of Americas Statement of Facts

Bank of America to pay $16 billion fine for mortgage fraud - homeowners to get $7 billion

It's the largest civil fine in American history for the largest crime in American history.

Bank of America Settlement

Consumer Affairs Bank of America will provide $7 billion relief to aid hundreds of thousands of consumers harmed by the financial crisis precipitated by the unlawful conduct of Bank of America, Merrill Lynch and Countrywide, Holder claims.

The settlement does not release individuals from civil charges, nor does it absolve Bank of America, its current or former subsidiaries and affiliates or any individuals from potential criminal prosecution.


Bank Of America To Pay $16.65 Billion In Historic Justice Department Settlement For Financial Fraud Leading Up To And During The Financial Crisis

The settlement does not release individuals from civil charges, nor does it absolve Bank of America, its current or former subsidiaries and affiliates or any individuals from potential criminal prosecution.


Bank of America Settlement

Department of Justice This agreement is notable because it achieves real accountability for the American people and helps to rectify the harm caused by Bank of America’s conduct through a $7 billion consumer relief package that could benefit hundreds of thousands of Americans still struggling to pull themselves out from under the weight of the financial crisis.”

U.S. Attorney Anne M. Tompkins for the Western District of North Carolina said: “Even reputable institutions like Bank of America caved to the pernicious forces of greed and cut corners, putting profits ahead of their customers. As we deal with the aftermath of the financial meltdown and rebuild our economy, we will hold accountable firms that contributed to the economic crisis. Today’s settlement makes clear that my office will not sit idly while fraud occurs in our backyard.

Bank of America Adds a Mortgage Settlement to Its Collection

Bloomberg This one is the biggest so far, but it is also the most recent so far, and the word "record" gets used a lot in Bank of America settlement announcements. If there's a $30 billion Bank of America mortgage settlement in November, my mind will remain un-blown.


A Crackdown on Law Firms

while foreclosure-mills run free.

At least 1,000 borrowers who signed on to “mass joinder” lawsuits against their mortgage lenders were allegedly scammed by two law firms that claimed to be acting on their behalf, according to a suit filed by attorneys general in Connecticut and Florida.

NY Times Earlier this month, the states obtained a temporary restraining order from a United States District Court judge in Florida halting further activity by the Resolution Law Group of Greenwich, Conn., and the Berger Law Group of Tampa, Fla. 

The firms are accused of misrepresenting to struggling homeowners that they would receive loan modifications.


Some homeowners could get hit with a whopping tax bill if they accept help through Bank of America’s settlement

In negotiating the deal, the Justice Department recognized that many of the borrowers it was trying to reach would be in no position to accept the help if doing so would lead to a huge tax bill.

Washington Post “Consumer relief will take various forms including loan modification for distressed borrowers, including FHA-insured borrowers, and new loans to credit worthy borrowers struggling to get a loan in hardest hit areas, borrowers who lost homes to foreclosure or short sales, and moderate income first-time homebuyers.”

But for the borrowers that reap the rewards from BofA, there could be something that severely dents the promised relief funds, a huge tax bill.


SEC Turns Up the Heat on Ocwen

Home Loan Servicing Solutions (HLSS) was spun off from Ocwen Financial in 2010 to acquire mortgage servicing assets including servicing rights, rights to fees and other income from servicing loans.

National Mortgage News Ocwen spun off Altisource Portfolio Solutions (ASPS), a provider of technology, outsourcing and fulfillment services, in August 2009. Altisource Portfolio Solutions later spun off Altisource Residential Corp. (RESI), and Altisource Asset Management Corp. (AAMC) as two separate public companies in December 2012. Altisource Residential is a real estate investment trust that acquires single-family rental properties by purchasing distressed mortgages and real estate owned properties. Altisource Asset Management provides portfolio management and corporate governance services to real estate investment firms.

Borrowers Could Suffer in Servicing Transfers, CFPB Warns

Mortgage Servicing News The Consumer Financial Protection Bureau issued a bulletin Tuesday warning mortgage servicers of "potential" repercussions if consumers are harmed when servicing rights change hands.

Bank of America Expected to Settle Huge Mortgage Case for $16.65 Billion

DealBook Yet even as that accord nears completion, prosecutors are preparing a separate civil case against Angelo Mozilo, the man who came to embody the risk-taking for which Bank of America is now paying dearly (using a small part of the loot it stole from homeowners and investors), a rare move against a senior executive at the center of the financial crisis.


Countrywide’s Mozilo Said to Face U.S. Suit Over Loans

Strip Mozilo of all his wealth, clothes and tan. What did Mozilo do that every other bank did not do?

Bloomberg The government is making a last ditch-effort to hold him accountable for the excesses of the past decade’s subprime-mortgage boom, using a 25-year-old law that has helped the Justice Department win billions of dollars from Wall Street banks, 

Retired Police Officer Files Motion to Vacate Void Order Alleging Judicial Corruption in Dallas Court

A judicial order that grants LNV permission to deprive us of our property when the judge issuing that judgment has not even read our pleadings, and when
no credible witness has testified, when no discovery has been permitted, and
when we were intentionally denied a continuance to obtain another attorney
and thereby forced to proceed pro-se is a gross violation of our right to due
process. Dovenmuehle Mortgage is also involved.


Confronting the Ridicule of Counsel for the Bank


If you file a claim or affirmative defenses along with your answer denying everything, you will often be met with a motion to strike the affirmative defenses or claim. The reason is simple, once the court agrees that the matters you alleged in your pleading are in issue, you are automatically entitled to discovery on those issues. 

Living Lies And that is why I continue to say that the more aggressive you are in the beginning of litigation the more likely you are to get win or get a settlement early in the process. Pleading lack of consideration raises the issue of what happened with the money?

Once that is in issue, your discovery questions and requests can be directed at that. Once the foreclosers are forced to open up their books and records, my experience is that they will fold. They generally don’t have a cancelled check or wire transfer receipt from anyone in their “chain.”
Here is what was submitted in one case in opposition to the motion to strike the affirmative defenses of the homeowner:


Sound and Fury in Bank Settlements, Still Signifying Nothing

Instead of shining the bright light on wrongdoing that took place at the Wall Street banks, Mr. Holder’s settlements allow them to cover it up permanently.

DealBook Mr. Holder, as attorney general, is following through on an idea that he proposed as a subordinate 15 years ago does not make his behavior any less infuriating. The fact is that by settling with the big Wall Street banks for billions of dollars — money that comes out of their shareholders’ pockets — Mr. Holder is allowing them to avoid the sunshine that Louis Brandeis wrote 100 years ago was the best disinfectant. 


MERS frankly stated the purpose of the MERS mortgage is to circumvent the recording statutes by creating a private and voluntary recordation system for members. MERS held that as the recorded "nominee," it was only necessary to record the MERS mortgage; written assignments of mortgage among MERS' members were not required,
nor recordation of such assignments.

John Wood, Esq.  Law journals raised early warnings that this scheme offended the basic prohibition of splitting the note from the mortgage, but in 2000 Freddie and
Fannie, then private corporations for the past thirty years, stated they would accept the new mortgage, and it was soon widely adopted. There was no statutory, decisional or Restatement
change made that would authorize this private opt-out from recordation law. The market gradually became opaque rather than transparent, with no public certainty who held the debt on a property.


Benjamin Lawsky Shows Other Bank Regulators How to Do Their Jobs

Lawsky is taking a very serious interest in an area near and dear to our hearts, namely, mortgage servicing.

naked capitalism As a result of various settlements, some banks have taken to moving their mortgage servicing over to stand-alone, non-bank mortgage servicers. The only problem with that notion is that higher-touch mortgage servicing (which could be a partial answer to the problem) is more expensive, when compensation for servicing is already fixed in pooling and servicing agreements with investors. But as we’ve pointed out, the problems with mortgage servicing are deep-seated, and reflect among other things, deep seated problems with the underlying systems.


“Teaser” Payments: Trick or Treat?

Living Lies I have been examining and analyzing loans that are referred to as “reverse amortization loans”. They are, in every case, “teaser payments” that trap homeowners into a deal that guarantees they will not keep their home — even if it has been in their family for generations.

Court discredits Glaski case

Mendoza v. JPMorgan Chase

Glaski, however, has not been well received by federal courts. “Every court in [the Northern] district that has evaluated Glaski has found it is unpersuasive and not binding authority.

California Third Appellate District In affirming the trial court’s dismissal of the second amended complaint for wrongful foreclosure, declaratory relief, and quiet title, the Court of Appeal concluded: (1) plaintiff failed to make a specific factual showing that the foreclosing parties did not have the requisite interest in the property to issue the notice of default, the notice of trustee’s sale, and the trustee’s deed of sale; and (2) in the absence of prejudice, she lacked standing to challenge irregularities in the securitization process.

Altered Bank Study Draws Fine for Giant Auditor PwC

DealBook The regulator, Benjamin M. Lawsky, extracted a $25 million fine from PricewaterhouseCoopers. Under the deal, Mr. Lawsky will also prevent the firm’s regulatory consulting unit from performing certain assignments on behalf of New York-regulated banks for two years.


The True Sale Doctrine, and the Origins of the Financial Crisis



The “true sale doctrine” is not a staple of the law school curriculum. At best it makes a brief cameo in secured transactions and bankruptcy courses. Notwithstanding this academic obscurity, however, its failure may have had a big role in the current melt-down of the banking sector and with it the world economy. Here is the gist of the issue:


Forced-Placed Insurance Kickbacks Still Alive

National Mortgage News The Federal Housing Finance Agency banned banks and mortgage servicers from accepting commissions on force-placed insurance policies issued by affiliated companies. At least one mortgage servicer, Ocwen Financial, has found a way around the ban.


Wall Street Escapes Blame, Again

The news last week brought two fresh reminders of the government’s failure to hold Wall Street accountable for the financial crisis.

NY Times It’s hard to escape the impression that liability and guilt for the financial crisis have gone undetected and unpunished. The S.E.C. recently began extracting admissions of wrongdoing from banks and hedge funds in cases unrelated to the crisis, and the Justice Department recently extracted guilty pleas from a couple of big European banks, also in cases unrelated to the financial crisis. But accountability for events leading up to the crisis and during the bailout is still lacking


Regulators Punting on “Too Big to Fail” Problem of Repo, Looking to Install Yet Another Bailout Vehicle

The post-crisis era is rife with band-aid-over-gunshot-wound approaches to deep-seated weakness in the financial system. 

naked capitalism Perversely, because the authorities were able to keep the system from falling apart, albeit via a raft of overt and covert subsidies to the perps, they've reacted as if all that needs to be done is a series of fixes rather than more fundamental interventions.

One glaring example is a critically important funding mechanism, repo, for firms that hold large inventories of securities and/or enter into derivative positions, such as major capital markets firms like Goldman, Deutsche Bank, and Barclays, as well as hedge funds. Here, the authorities have been giving way to industry demands that will assure that repo, which was bailed out in the crisis, will be bailed out again.


36,000 Madoff Victims Have Not Received a Dime in Restitution

When the highest law enforcement in the land quashes a subpoena from a Federal regulator while deferring felony prosecutions and settling on the cheap with a serial miscreant – leaving tens of thousands of Madoff victims destitute for six years – the public and defrauded investors around the world need answers.

To do anything less sends a chilling message around the globe that the U.S. is not a safe place to invest.

Pam Martens Wall Street on Parade One primary reason their claims have been denied by Picard revolves around the decision, upheld by the court, to return only original principal deposited – not fictitious profits shown on the statement. Since there was not going to be adequate funds to pay fictitious profits, this seemed like a good idea at the time. The problems emerged when a pooled fund account was deemed – on a total account basis – to have withdrawn more principal than deposited; even when thousands of investors in the fund may have never withdrawn a dime, if the fund account as a whole had withdrawn more principal than it had deposited on behalf of all investors, the claim was denied as it was deemed a net winner.

Scott Stafne Explains Knecht v. Fidelity and Unconstitutional Washington Deed of Trust Act DTA

Federal courts rule against the homeowner 92% of the time.

Scott Staphne, Esq. We are here with Attorney Scott Stafne whose client John Knecht has pending questions for the Federal Court to Certify to the State Superior Court involving the apparently Unconstitutional Washington Deed of Trust Act. He is having a difficult time being heard.



Why Is the Justice Department Falling Short With Mortgage Settlements?

Financial penalties are good. Personal accountability would be better.

The most striking flaw in the JPMorgan settlement is the absence of accountability. The anodyne “statement of facts” that accompanied the agreement does not include names or any admission that laws were broken. No one has been indicted or arrested, and no criminal charges are on the horizon. That $13 billion penalty, in other words, is just another cost of doing business.

The Nation The Justice Department’s strategy is fundamentally flawed. For starters, those record sums are misleading: JPMorgan’s $9 billion cash penalty is a pittance compared with the $2.4 trillion in total assets the firm reported at the end of 2013—and the money comes from the bank’s coffers, not the bankers’ pockets. When it comes to mortgage relief, the bank has a direct interest in protecting its borrowers from defaulting on their loans. Plus more than half of the settlement is tax-deductible, meaning taxpayers will pick up part of the tab.

In the end, the kind of legal and social punishment that would deter the criminality that ran rampant on Wall Street before the crash is not inflicted by a financial penalty, no matter how steep. It is created when bankers are forced to pay out of their own pockets for the frauds they’ve committed, and when they are publicly shamed, prosecuted and put behind bars. Personal accountability—in the form of criminal prosecution and the disgorgement of ill-gotten gains—is the only way to convince Wall Street titans like Jamie Dimon that crime doesn’t pay.


Bank of America could get tax break on part of $16 billion mortgage settlement

By law, banks can write off portions of their settlements that aren’t considered fines or penalties, such as payments to states affected by their alleged misconduct.

Charlotte Observer That means billions of dollars in Bank of America’s expected settlement could be tax-deductible.

The practice has sparked criticism from some who think banks should not receive the silver lining of a tax deduction for misdeeds said to have fueled the worst U.S. economic crisis since the Great Depression.


Inside the Dark, Lucrative World of Consumer Debt Collection

He told me he had purchased it from a debt broker in Florida. It was part of a much larger package of roughly $50 million worth of debt, which he bought for just 12 basis points — or one-twelfth of a penny on the dollar. 

As Owens saw it, when buying from debt brokers, this was all part of the risk you faced. He concluded: “It is just data you are purchasing.” 

NY Times Such sloppy record-keeping may seem surprising, but it is prevalent enough that in 2009, the FTC. said in a report: “When accounts are transferred to debt collectors, the accompanying information often is so deficient that the collectors seek payment from the wrong consumer or demand the wrong amount from the correct consumer.”

As long as paper continues to be stolen, double-sold or otherwise exchanged without accurate supporting information — like statements or copies of the original signed contracts — consumers will be exploited.

This NY Times article about debt collectors was very good – but missing a “BIG” point --- the banks already securitized the credit card debt when it occurred into asset-backed securities. So when they sold the debt to debt collectors they were selling people’s personal information. There really was no “debt.” Seems to me to be just another criminal enterprise of the banks. 


The deal that cost Bank of America $50 billion – and counting

The disastrous purchase not only harmed investors but also employees and homeowners.

Charlotte Observer Praise for Bank of America would evaporate as foreclosures mounted in the recession, fueling homeowner anger and protests around the country.

Inside the bank, the criticism wore on some employees.


In a Bank Settlement, Don’t Forget the Bulldozers

"For federal and state governments, the deal will mean billions in cash and borrower assistance." Really? The borrowers need to be made whole - not assisted.

NY Times "As has become typical in these settlements, troubled borrowers across the country will most likely receive aid in the form of reductions in what they owe on their mortgages. Money will probably also be set aside for loan counseling, an important tool for countering predatory lending."
Who said the borrower owes anything on their fraudulent mortgages?
There is fraud in virtually every one of them, and that, along with the proven intentional destruction of the original Note, forgave the debt.


Mortgage Loan Companies Bring Back Subprime

In recent years few have spoken of the “toxic” loans that led to the recession, but they are making a comeback

Guardian LV ARM loans were a major contributor to the trouble in the housing market, as lenders offered borrowers low teaser rates to entice them, which later rose leading to astronomical house payments that borrowers could not afford. The stories told by homeowners are often the same. They took out a loan to buy a first home or a dream home and thought life was wonderful as they enjoyed the fruits of their labor. Only too soon did those first-time homeowners have the rug pulled out from under them when they received notice that their house payment had increased by double, triple, or quadruple the amount of the borrowers original monthly payment.

Fannie Mae Loses Case Over $100K In Fees

dbr "That case on its face proves that safe harbor is an affirmative defense," said PeytonBolin founding member Mauri Peyton, who represented the association. "Fannie Mae has to prove that it owns the mortgage. And if they don't prove it, they don't get the safe harbor."


Nuclear Questions and Logic in Foreclosure Litigation

It would be very interesting to see a brief asking the question about why the “creditor” never alleges it is a holder in due course. That would solve everything for the banks — so why don’t they do it?

Living Lies So if the Trust was unfunded but it was still investor money that was used to fund the loan, that would explain the absence of any monetary transactions (except fees and profits) relating to the loan origination and transfers. And THAT leads back to the question of law and equity that every court is dodging — if the borrower received an undocumented loan from investors, what rights are created for those who intervene in the transaction and make claims of default and rights to foreclose? Which leads to the final nuclear question: Are the courts inadvertently creating equitable mortgages in favor of investors or their designee when the original transaction was fatally flawed and in violation of all known lending and closing standards?


Texas Governor Rick Perry indicted on two felonies

Trail Blazer Gov. Rick Perry was indicted on two felony counts for abuse of official capacity and coercion of a public servant late Friday by a Travis County grand jury.


Homeowner can sue for Mod-Fraud

Alvarez v. BACHLS

  The court concluded that plaintiffs have alleged a cause of action for fraud against defendants where the complaint alleged that the loan documents concealed the terms of plaintiffs' loans and plaintiffs have alleged facts establishing defendants' liability for the alleged fraud.

"The judgment is reversed as to plaintiffs’ first, second and sixth causes of action and the matter is remanded to the trial court for further proceedings consistent with this opinion. Plaintiffs shall recover their costs on appeal."

Bank Of America Settles Bankruptcy Case For $26.4 Million In Loans

Daily Business Review In an unique settlement, Bank of America Corp. will hand over $26.4 million in mortgage loans to the bankruptcy liquidation trustee for defunct Taylor, Bean & Whitaker Mortgage Corp.


Stop Big Bank Bandits Now

In the past four years alone, JPMorgan Chase has paid out $28,902,150,000 in fines and settlements for fraudulent and illegal practices. You could be next. 

JPMadoff.com Bernie Madoff committed the biggest financial crime in history. He stole $64.8 billion from tens of thousands of innocent people from countries all over the world. But he did not do this alone. In fact, he could not have done this alone. He needed the assistance of a major financial institution and he needed a bank that would conceal his criminal activities. 



This huge investment in private equity funds in residential mortgages ended very badly for most investors and also for millions of homeowners who lost their homes to foreclosures by strangely-named trusts. In many states, the mortgage crisis continues in 2014, with trusts on the brink of insolvency, neighborhoods plagued by abandoned trust-owned homes, and foreclosure rates actually increasing from the 2013 rates.

THJF In every case in a study of 500 foreclosures by trusts, the foreclosed home sold for significantly less than the amount of the final judgment. In many cases, the foreclosed homes sold for much less than the original loan sold to the trust.

There is also significant evidence of re-sales for less than fair market value. In many cases, the foreclosed homes were purchased at auction by the trusts for $10 or $100, because no other bidders bid on the property. The trusts then sold these properties to third-party purchasers who resold the properties within the next 30-180 days at a profit of $10,000 to $60,000.
Foreclosures have also left a massive multi-trillion dollar problem of deficiency judgments looming on the U.S. economic horizon.


Knecht Trilogy: Court Rules Majority of Claims to be Resolved at Trial (with documents)

Court untangles the MERS ruse.

MERS Falsely Declared Itself the Beneficiary of Mr. Knecht’s Deed of Trust, and Purported to Convey to DB Rights That MERS Never Held. 

Stafne Trumbull From its inception, Mr. Knecht’s deed of trust ran afoul of the Deed of Trust Act by designating MERS as its beneficiary. The Act declares that the beneficiary of a deed of trust is “the holder of the instrument or document evidencing the obligations secured by the deed of trust . 

Knecht v. Fidelity Title


How a $600 Servicing Error Snowballed into a $16M Jury Verdict

"PHH wouldn't own their own mistake and find a reasonable solution, which was to do the decent act of writing a letter to clarify everything," said Oldenburg.

Mortgage Servicing News PHH is appealing the judgment, which may eventually be reduced. But the case encapsulates many of the problems that have plagued the mortgage servicing industry in recent years -systems errors, confusing and contradictory information sent to borrowers and apparent indifference to their situations.

The company continued to claim he had a deficiency, which Linza had always claimed was incorrect.


Robo-Slop or “How I Learned to Stop Worrying and Love Foreclosure”

Sometimes courts say: “The bank has the Note, so it can collect the debt.” Courts will allow a bank in possession to proceed if it holds the original note, or if they have a valid assignment. Left unexamined, though, this logic doesn’t work. When Banks are allowed to issue thousands of phony documents a day chasing foreclosures, without oversight, it’s bound to get a just a wee little bit sloppy.

Dee Compton, Esq. Another ugly truth is that banks often can’t even find the original notes and mortgages they say they own. So, instead of producing the original documents, they come to court with made up copies of Notes, with apparent assignments or “allonges” on them, that are supposed to show that the bank is the lawful owner of that Contract. In fact, they are really fake documents created just so banks can run foreclosures quickly through the courts. And, since most people don’t fight them, this usually works.

Here is a real life sample fraudulent allonge fixed up by a bank solely for the purpose manufacturing evidence where it doesn’t exist:


US Bank v. Faruque

The issue of standing cannot be determined as a matter of law on this record, since a question of fact remains with respect to the issue of whether the plaintiff was the lawful holder of the note when it commenced the action 

NY Appellate Division, Second Department Accordingly, the Supreme Court properly, in effect, denied that branch of the plaintiff's motion which was for summary judgment on the complaint insofar as asserted against Faruque, since the plaintiff failed to establish, prima facie, that it had standing to commence the action.


Witnesses in Foreclosure Cases Are NOT Business Records Custodians

I can go through exchange after exchange in this one trial alone where the Plaintiff is not making legal argument…it’s the judge making legal argument for the Plaintiff!

Weidner Law In many foreclosure trials, the courtroom gets all psychedelic as the judge and the Plaintiff work together to convince an otherwise knowledgeable attorney that something that “is”, “isn’t” and something that “was”, “wasn’t”.

One of the most frustrating things about foreclosure trials is the fact that the battle is not against the opposing counsel or their witness…the battle is nearly often against the judge.


Delinquent-Mortgage Bonds Attracting Investors

Now the recovery in housing is fueling a niche market for newly minted bonds that are backed by the most troubled mortgages of them all: those on homes on the verge of foreclosure.

DealBook And it is not just vulture hedge funds swooping in to try to profit from the last remnants of the housing crisis. The investors making money off these obscure bonds — none are rated by a major credit rating agency — include American mutual funds. And one of the biggest sellers of severely delinquent mortgages to investors is the United States government housing agency HUD and Freddie Mac.


Time to Get Serious About RESPA/TILA Compliance

What's all the fuss about? The changes integrate existing Truth in Lending Act and Real Estate Settlement Procedures Act provisions. According to a SourceMedia webinar that included several officers of CFPB as presenters, the initial Truth-in-Lending disclosure and the good faith estimate from RESPA will be combined into a new doc called the Loan Estimate form.


National Mortgage News Those general penalties for violations are daunting, according to Stewart. They include:

*First Tier Penalties - $5,000 per day.

*Second Tier Penalties - for reckless engagement in violations, $25,000 per day.

*Third Tier Penalties - for knowing violation, maximum penalty of $1,000,000 per day.

Officers, directors and employees of non-compliant lenders also face cease and desist orders as well as a prohibition from recovering fines and penalties from insurance; a prohibition from offsetting borrower claims with amounts paid for penalties; and other monetary damages as well as restitution, rescission, reformation of contracts, refunds, and return of compensation.


Barclays Could Face $2 Billion More in Litigation Charges

DealBook Barclays could book 200 million pounds in provisions to settle an investigation by the New York attorney general’s office into the bank’s private stock market, known as a dark pool, and 700 million pounds related to continuing industry-wide investigations into potential manipulation of the $5.3-trillion-a-day currency market.

Mary Jo White was Supposed to Turn Around the S.E.C. She Hasn’t.

ProPublica Regulators, administration officials, current and former S.E.C. staff members, financial reform advocates and people on Capitol Hill whose opinions of Ms. White's performance range from dissatisfied to infuriated.


Student Loan and Mortgage Loan Debt: A Public Health Crisis?

Recent research about student loans and mortgages raises the question of whether having too much debt can make you sick.

Huff Post A recent Gallup survey of more than 11,000 college graduates finds that graduates with a substantial amount (i.e., more than $50,000) of student loan debt are worse off emotionally and physically than other college graduates. These survey results are particularly troubling because the results suggest that it is the debt itself - not the burden of repaying the debt - that seems to make people sick.



Ex A.G.s Mark Shurtleff, John Swallow face civil lawsuit over Bank of America case

"Mr. Swallow got a big campaign contribution. Mr. Shurtleff got a new job and Utah homeowners got nothing," Kevin McBride said.

Deseret News Swallow along with former Utah attorney general Mark Shurtleff are charged with receiving or soliciting bribes, accepting gifts, tampering with evidence, obstructing justice and participating in a pattern of unlawful conduct.

Darl and Andrea McBride say Shurtleff and Swallow personally benefitted from their involvement in the case at the expense of Utah homeowners, including the McBrides, whose houses Bank of America had foreclosed on. The couple says the bank forced them into default as a condition of modifying their loan and then tried to take their home.


Ocwen misstated mortgage value results

Ocwen Financial, the mortgage-servicing criminal enterprise controlled by William Erbey, misstated the value of mortgages sold to a second Erbey-founded company over a 15-month period.

New York Post The misstatements happened as the billionaire businessman moved his stake in that second company, Home Loan Servicing Solutions, to an overseas tax shelter, separate regulatory filings show.
Erbey’s financial moves came to light Tuesday after Ocwen, the country’s largest non-bank mortgage servicer, warned investors audited financial filings for last year and the first three months of 2014 “should no longer be relied upon.”

Another loan mod scam telling the homeowner to default.

Unfair Loan Mod Negotiations

In reviewing many cases with allegations such as these, it seems to me that judges are genuinely shocked by lender behavior in loan modification negotiations.

Compton v. BACHLS et al

Compton has “nudged” her UDAP claim
“across the line from conceivable to plausible.” 

Prof. David Reiss



The Court of Appeals concluded, however, that the homeowner/plaintiff had sufficiently alleged that BAC engaged in an “unfair or deceptive act or practice” for the purpose of withstanding a motion to dismiss. As previously noted, Compton does not base her UDAP claim on allegations that BAC failed to determine whether she would be financially capable of repaying the loan. Rather, the gist of Compton’s complaint is that BAC misled her into believing that BAC would modify her loan and would not commence foreclosure proceedings while her loan modification request remained under review. As a result of these misrepresentations, Compton engaged in prolonged negotiations, incurred transaction costs in providing and notarizing documents, and endured lengthy delays. The complaint’s description of BAC’s misleading behave or sufficiently alleges a “representation, omission, or practice” that is likely to deceive a reasonable consumer.(15)

What I Could Not Tell The Jury in Decatur

In my experience after reviewing over 10,000 foreclosures, original loan documents are most likely to be lost when the loan is repeatedly transferred as in the Harris case.

I reviewed 4 mortgage assignments and a Lost Assignment Affidavit.

Why go through the trouble of using a document company to prepare all these assignments if you had the properly endorsed original note in your control?

Lynn Szymoniak


There were missing documents. There was no assignment to PNC Bank, so the subsequent assignment from PNC to Green Tree was invalid as it had not been established that PNC owned the note and mortgage. There was a break in the chain of title.
And this break also occurred at the beginning of the chain – because there was no assignment from Team One, the original lender, to National City Real Estate, the next entity that claimed to own the note and mortgage. How could National City Real Estate make a valid transfer if the loan had never been validly transferred to National City Real Estate?


Rather Than Prosecutions, Fed Pressuring Banks to Pay Miscreants Less

The American public knows well, another way to influence bank behavior would have been prosecutions, or at least heavy fines of executives.

naked capitalism Again using Citi as an example, the CFO Gary Crittenden was fined a mere $125,000 for keeping $40 billion of CDOs off the balance sheet. Huh? And that’s before the fact that just about no one save one former Countrywide exec was roughed up at all for all of the subprime lending fraud. And the officialdom has been so desperate to cover up chain of title issues that it has had even less interest in pursuing widespread foreclosure-related misconduct.


U.S. Finds Fresh Use for Seldom-Used Statute in Subprime Cases

One little-noticed provision of Firrea was Section 951, now found at 12 U.S.C. § 1833a, which gave the Justice Department the power to pursue criminal violations involving banks by means of a civil lawsuit for penalties. Similar to the Racketeer Influenced and Corrupt Organizations Act, or RICO, it allows a civil case based on proving a crime, with the benefit of applying the lower standard of proof used in those cases rather than showing a violation beyond a reasonable doubt. Unlike RICO, however, only the Justice Department can pursue a Firrea case, not private individuals.


DealBook Firrea was adopted in 1989 during the height of the savings and loan crisis when thrifts that were created to make plain-vanilla home mortgages had shifted into risky lending that drove many into insolvency. The primary goal of the statute was to overhaul the banking system by getting rid of the Federal Savings and Loan Insurance Corporation, which had run out of money, and expand the power of regulators to protect against abuses by insiders who often treated savings and loans as their own personal piggy banks.

Crimes are typically investigated by a grand jury, which can compel the production of evidence and testimony from witnesses. The civil investigatory power is nearly as broad, with the Justice Department authorized to issue subpoenas to “summon witnesses and require the production of any books” or other evidence from any place in the United States


Wells Fargo Said to Offer $1.3 Billion in Banks’ Garbage

Bloomberg Wells Fargo is marketing two pools made up of mostly reperforming loans as well as nonperforming loans, said the people, who asked not to be identified because the sale is private. The offering includes a pool of about $630 million in unpaid principal balance, and another of about $700 million, one of the people said.



The bank is just being punished without being ordered to fix what it broke. Richard Eskow, a blogger for the Huffington Post, makes a keen observation about what should really happen to financial centers like Goldman Sachs and Bank of America.

Ring of Fire Settlements require no compensation or relief for the consumers who are underwater on their mortgages whatsoever. Secondly, banks aren’t required to return homes to customers upon whom the bank wrongfully foreclosed. And the Justice Department doesn’t ask the bank to forfeit any wrongfully obtained money to customers or to restore a customer’s credit. Just pay your fine and be on your way.


Attorneys General Go After Five Law Offices

Attorneys general from two states sued five law firms in Federal Court, claiming they took millions of dollars in upfront fees for putative mass-joinder lawsuits for homeowners facing foreclosure, but never provided services.

Courthouse News The attorneys general say in the 39-page lawsuit that the U.S. foreclosure crisis led to a drastic rise in predatory practices by firms like the defendants, who "made money by charging distressed homeowners upfront fees on the promise that they could obtain mortgage modifications for these homeowners, often providing little or no actual assistance."

Suspension Justified in Allied Mortgage Case

The Federal Housing Administration paid $834 million "for mortgages originated and fraudulently certified by Allied that are now in default."*

Memorandum & Order

Courthouse News Federal prosecutors in New York sued Allied Home Mortgage Corp., its CEO Jim Hodge and executive vice president Jeanne Stell in 2011, alleging Allied's "decade of misconduct has resulted in tens of thousands of defaulted loans, thousands of American homeowners facing eviction, and hundreds of millions of dollars in losses to the United States."





The Assignments Are Lies With a 'Presumption' of Truth

At some point the Courts will need to accept some of the responsibility for the damage caused by this scheme.

The courts are causing homeowners to forfeit their homes because of errors originating on Wall Street. The courts are starting off with the premise that the debt at issue is valid when it is not. And they are allowing and promoting presumptions of fact that are in direct conflict with the facts that are presumed to be true.

Why isn’t the hair on the back of the Judge’s neck raising when they see “holder” and not “holder in due course?”

Living Lies Legal presumptions are used when it is obvious that the assertion is most likely true. Judges are assuming that the claim that the borrower owes money to the party pursuing foreclosure. That assumption stems from prior experience when it WAS true that nobody was going into court claiming the right to collect on a debt or to foreclose on collateral unless the debt, note and security agreement (mortgage) were all true and valid. What is NOW obvious is that the facts in most cases show that there is no debt and thus there is no valid note and hence there can be no enforcement of either the note or mortgage even if they were signed by the homeowner — nor should they be enforced by the parties seeking to enforce them. It would possibly be different if the Trusts were holders in due course or if anyone had that status. But that is clearly and indisputably neither alleged nor true.

2,061 of Citigroup’s Subsidiaries Go Missing

Pam Martens

Wall Street on Parade

Figuring out what Citigroup owns and what it has sold is getting harder by the day as a vast number of its subsidiaries in the 160 countries in which it operates have up and vanished from its public filings but do not actually appear to have been sold in many cases.


Bank of America faces a hefty fine, but ‘too big to fail’ still threatens

Washington Post No one should confuse this pending settlement with a solution to the deeper problem of the U.S. financial system — namely that Bank of America and other institutions remain too big to fail. The prospect of a taxpayer rescue in the next crisis still threatens the U.S. government’s finances and may distort the flow of capital by implicitly subsidizing the giants. 

When She Talks, Banks Shudder

NY Times ‘Something Is Very Wrong’

Before the financial crisis in 2008, Ms. Admati spent most of her time working with complicated financial models. She had never paid much attention to banking or to public policy. But as the crisis unfolded, she began reading and talking with colleagues — “like a doctor from another field of medicine visiting the emergency room,” she said — and grew increasingly disconcerted by what she learned.


UPDATE: Bank of America Fined Another $16 Billion for Fraud

OpEdNews The jurors in last year’s trial sent out a note during deliberations asking why more senior Countrywide executives weren’t being sued with Mairone. Many American taxpayers, homeowners and investors cannot be blamed for wondering the same thing.”

Exactly. Why isn’t Eric Holder going after the senior executives? Start with Bob Rubin, Hank Paulson, Bryan Moynihan, Ken Lewis, and Jamie Dimon. Seek prison terms on conviction. That would incentivize the banks.


Dust off the pitchforks - Home Foreclosure racket continues

Not only did the original mortgage holder get back all its money from the loan, plus all missed payments, out of pocket expenses and various generous fees, it also made a very respectable profit on the convoluted but perfectly 'legal' slight of hand. All paid for by you -- the US tax-payer.

OpEdNews Our sham of a democracy has been hijacked by a political mafia and its corporate paymasters. Changing President or the control of Congress will not stop this and other corporate rackets. Voters need to start asking some serious questions of potential candidates for the 2016 elections unless they wish to keep subsidizing the financial losses of the establishment. Alternatively, they can just dust off their pitchforks.



Although poorly drafted, we agree 
that potentially meritorious claims can be distilled from the allegations of the complaint.

We shall therefore reverse the judgment as to the fraud, unfair competition and 
negligence causes of action, but shall not preclude the trial court from entering further orders designed to clarify the relevant allegations supporting viable claims for relief.

Confidential: Freddie Mac's Imminent Default Indicator

Freddie Mac Imminent Default Indicator is a software application that utilizes statistical models in conjunction with specific data elements submitted by the Servicer to determine whether a Borrower is in danger of imminent default.

South Florida residents served with second foreclosure nightmare years after home is taken

Roy Oppenheim, Esq. In a month-long period beginning June 1, about 110 so-called deficiency judgments were filed against Palm Beach County homeowners by a Texas-based debt collection company called Dyck O’Neal. The same firm filed more than 300 cases in Broward County and nearly 200 in Miami-Dade County.


Mortgage loan scams hurt homeowners

Predators have ways to find vulnerable families and take advantage, charging hundreds or thousands of dollars, promising relief but not delivering what they agreed.

Also see: FTC Issues Final Rule to Protect Struggling Homeowners from Mortgage Relief Scams

Michigan State University Victims of mortgage fraud in Michigan may be able to obtain reimbursement through a special mortgage settlement fund. Through the joint efforts of the Governor’s Office, the Michigan Legislature and the Attorney General, Public Act 295 of 2012 created the Homeowner Protection Fund. The Legislature appropriated $7.5 million to the Homeowner Protection Fund to be used for “foreclosure rescue scam victim restitution payments . . . as approved by the attorney general.”


Three Charged in Massive Mortgage Modification Scam

Each of the defendants is charged with one count each of wire fraud and conspiracy to commit wire fraud. Each count carries a maximum of 20 years in prison.

dsnews The three are alleged to have stolen a total of $18.5 million from more than 8,000 financially struggling homeowners in all 50 states by falsely promising them pre-approval for lower payments through the Home Affordable Modification Program (HAMP) and aggressive legal representation, among other things.
"As alleged, these defendants preyed on thousands of homeowners struggling to make their mortgage payments and meet their financial obligations," Bharara said. "This office has zero tolerance for those who target and exploit financially vulnerable people, and we will continue to work to hold these and like-minded defendants accountable."

Former mortgage loan modification officer charged with fraud

Stuart Nisenbaum Jr. is accused of scamming clients into paying him fees to lower their mortgage interest rates

Milwaukee Sentinel Because Nisenbaum told his clients not to make any payments on their existing loans (just like the banks did), some of his clients were later faced with foreclosure while others were hit with fines from their existing lender, the state said.

Felony Warrant & Criminal Complaint


Inspector General Urges FHFA to Consider Suing Servicers, Force-Placed Insurers

Report: FHFA’s Oversight of the 
Enterprises’ Lender-Placed 
Insurance Costs

K&L Gates The report estimates Fannie Mae and Freddie Mac reimbursed servicers for $360 million in force-placed insurance charges in 2012, $158 million above what the inspector general estimated was the reasonable price for such insurance. If that measure of harm for one year is accurate, the damages over several years could be counted in the hundreds of millions.


Bank of America settles: So we're all good now, right?

Have we actually done anything to address that problem? Not really.” - Charles Kenji Whitehead, a Cornell Law School professor and former high-level banking attorney. 

Market Place Bankers didn’t create and sell dicey mortgage investments because they wanted to decimate the world’s economy. They did it because their bank bonus structures paid them handsomely for doing so. They were incentivized to keep going, long after red flags popped up.


How Bank of America's $17B Mortgage Fraud Fine Stings Shareholders Too

The Street Even if the settlement details are announced by early next week, as expected, investors will have to consider whether they really want to own shares in a bank that is still presiding over a shrinking base of loans -- in an economy the grew 4% in the second quarter -- and is still being held back by low interest rates.


Florida, Nevada Can't Win for Losing on Mortgage Crisis

The Street The winners and losers among the states are separated by the savvy of their attorneys general. Some state attorneys general were better prepared and more determined than others when it came to seeking damages from banks over their conduct during the subprime housing boom. Paradoxically, many of the hardest hit states were among the worst equipped and least willing to punish the banks for their misconduct.




This is the second sale that has been stopped in a span of 11 days.

Nationstar’s attorneys Rubin & Lublin PLLC sent a letter to the homeowner claiming that she had a loan with MERS

Foreclosure Defense Nationwide This statement was not only false in fact (as MERS does not lend money, is not the “Lender” on the Note, and is never a “lender”), but was also made more than six months after the Court of Appeals of Tennessee issued its decision in the MERS v. Ditto which held that MERS has no independent or protected interest despite MERS being named as the “beneficiary” or “nominee”.

It gets worse. On July 7, 2014, Nationstar sent a letter to the homeowner claiming that JPMorgan Chase Bank as Trustee for a trust with a different description was the owner of the loan. Four days later, Nationstar’s attorneys sent a letter to the homeowner again claiming that the homeowner had a loan with MERS, and again claimed that BNY “Corporation” as trustee for the Trust “Inc.” was foreclosing. There is no explanation for the change in entities, or how the loan rights went first to the 2005 Trust for either of the BNY entities, then to JPM, then back to BNY.


Bank of America's Penalty Misses the Point


Bloomberg None of the settlements holds individuals to account. Shareholders and insurers are covering the bills -- and the penalties include mortgage buybacks, refinancings and the like that may never reach actual victims. The banks haven't been made to plead guilty to crimes. Because the settlements were worked out in secret with no judicial oversight, the lessons for future bankers are murky, making the deterrent effect doubtful. Such settlements also hold little legal sway over other judges.


Bank of America to pay nearly $17 billion in mortgage pact

Politico The pact is expected to include a $9 billion fine and roughly $7 billion for consumers still struggling to make their mortgage payments or find financing for purchasing a home.

With the record deal with DOJ, Bank of America will have paid more than $50 billion in penalties and consumer relief in deals with government agencies — not including private investors — after acquiring subprime giant Countrywide and investment firm Merrill Lynch at the height of the crisis.


Foreclosure King Dave Trott topples Bentivolio in Michigan race

Politico Trott, who specializes in foreclosures, has built a diversified business empire and is worth between $60 million and $200 million, according to financial disclosure forms. (Which is it?)

It just so happens that the incumbent is the member of the tea party who is being targeted by a wealthy foreclosure attorney who simply wants to be a congressman.”


Regulators Reject Living Wills of 11TBTF Banks, a 100% Fail Rate

Remember that in the US, banks (ex Morgan Stanley) have their derivatives booked in the depositary, which means any losses to depositors as a result of derivatives positions gone bad would be borne by taxpayers.

naked capitalism And as we’ve written at excruciating length with respect to the Lehman bankruptcy, the magnitude of the losses cannot be explained by overvalued assets plus the costs resulting from the disorderly collapse. Derivatives positions blowing out (as well as counterparties taking advantage of options in how contracts can be closed out and valued) were a major contributor to the size of the Lehman black hole.



Setting the Record Straight One More Time: BofA’s Rebecca Mairone Fined $1Million; BofA Must Pay $1.3Billion

Sure, BofA feels your pain, poor homeowner, as Mairone continued to oversee theft of homes, throwing the owners out onto the street. Now she’s at JP Morgan, supposedly reducing the pain of those who’ve lost their homes to her thieving banksters.

It is not a surprise to us that the fraud was found. Fraud is everywhere at the biggest banks. Their business model was, and remains, fraud. Fraud can be found everywhere you look. All you have to do is look. Up to now, Washington has turned a blind eye to fraud at the nation’s biggest fraudsters. While it is nice that they are finally going after some of the small fry fraudsters, like Mairone, it is time to go after the top fraudsters—those who oversaw and rewarded (and were rewarded for) fraud.

Stop the fraudsters. Stop the foreclosures. There should be an immediate 5 year Country-Wide moratorium on foreclosures. Investigate the fraud. Jail the fraudsters. Put the biggest banks into receivership. Begin to clean-up the document mess created by the banks and MERS (the banks lost or destroyed all the records of property ownership). Our economy will not recover until this is done.

Prof. Randy Wray We have been amazed that, as one financially sophisticated entity after another found widespread fraud by Countrywide in the entire gamut of its operations, the administration, the industry, and the financial media act as if this is acceptable. Countrywide made hundreds of thousands of fraudulent loans. It fraudulently sold hundreds of thousands of loans through false reps and warranties. It fraudulently foreclosed on large numbers of loans. It victimized hundreds of thousands of people and hundreds of financial institutions, causing hundreds of billions of dollars of losses. It has defrauded more people, at a greater cost, than any entity in history.

The illegal foreclosures continue. Every day people are still losing their homes. Lives and entire communities are being destroyed. People are literally dying because their homes are being stolen from them. Mairone was an executive at Countrywide before she went to BofA. She knew the fraudster’s mode of operation very well—Countrywide was the most notorious originator of fraudulent mortgages in the country. Countrywide has directly caused countless deaths across the country.

Mairone’s bank specialized in making mortgages with terms that the loan officers and executives like Mairone knew the borrowers could not possibly service. Fraud was the business model. Foreclosure was the expected result.


Remember this? Nothing came of it and the link to the 2,600 page "Rudman Report" doesn't work and we can't find it anywhere.

The report cost taxpayers over $70 million. 

Report on Fannie Mae Cites Manipulation to Secure Bonuses

NY Times Investigators have uncovered new evidence that senior executives of Fannie Mae, the nation's largest buyer of home mortgages, manipulated its accounting in the 1990's to meet earnings projections so that top executives could receive more than $25 million in bonuses.

Mr. Rudman said that his team had not uncovered evidence that Mr. Raines deliberately embarked on a course of violating the accounting rules to win larger compensation, although the report found that Mr. Raines had met with Ms. Spencer and Mr. Howard in early 1999 to discuss deferring $200 million in expenses.


After a Long Fight, Judge Rakoff Reluctantly Approves Citigroup Deal

Rakoff initially rejected the $285 million settlement as “pocket change to any entity as large as Citigroup,” announced on Tuesday that he would approve the deal — reluctantly.

DealBook It would be a dereliction of duty for this court to seek to evade the dictates of the court of appeals,” Judge Rakoff wrote. The judge, known for his quick wit and distaste for financial fraud, added that the appeals court “has now fixed the menu, leaving this court with nothing but sour grapes.”

Judge Rakoff’s rejection of a Bank of America settlement that he called “half-baked justice at best,” raised larger questions about whether the S.E.C. was letting Wall Street off with little more than a slap on the wrist.

Another Win in Texas


Settlement agreement argument

First Circuit Court of Appeals Texas In one issue, the Bruesses argue that the trial court erred in granting judgment because (1) neither of them signed the settlement agreement, (2) they withdrew their consent before judgment was entered, preventing judgment on a 
motion to enforce, (3) dismissal of their claims with prejudice had no basis in law, and (4) the settlement agreement mandated that any disputes would be resolved by returning to mediation, not a judgment.


Freddie Sells $659M of Debt in First Soured-Mortgage Deal

Freddie Mac, the government-backed mortgage giant, sold $659 million of "deeply" delinquent (void, unsecured, uncollectable and worthless) home loans in its first offering of such debt.

Mortgage Servicing News Twenty-two idiots (potential buyers) participated in the auction, which was conducted by affiliates of Bank of America Corp., the McLean, Va.-based company said. It didn't disclose the price of the recyclable paper, and won't be naming the brain-dead garbage buyer.

The company, which "selected the winning bidder on the basis of economics," will "continue to look for opportunities to reduce exposure to less-liquid assets in its investment portfolio,"


Ocwen Probed by New York Over 'Troubling' Home Insurance Deals

Benjamin Lawsky, the superintendent of the Department of Financial Services, is reviewing Ocwen's force-placed insurance arrangement with Altisource Portfolio Solutions, which he described as "troubling,"

Mortgage Servicing News "Altisource will generate significant revenue from Ocwen's new force-placed arrangement while apparently doing very little work," Lawsky said in the letter. Documents suggest "Ocwen hired Altisource to design Ocwen's new force-placed program with the expectation and intent that Altisource would use this opportunity to steer profits to itself."

Judge’s Ruling Against Bank of America Showcases a Novel Enforcement Strategy

Federal district court judges have rejected arguments by banks that a fraud can occur only if it affects a different financial institution. Instead, the judges have found, the bank committing the crime can also be the one that is affected. So even a self-inflicted wound would be enough to violate Firrea and subject the bank to additional costs.


DealBook Rather than subtracting any benefits from the mortgages that were sold, Judge Rakoff determined that the fraud affected every mortgage because the buyers – the government-controlled finance giants Fannie Mae and Freddie Mac, in this case – would never have purchased the mortgages in the first place had they been told about Countrywide’s shoddy loan approval practices. He compared the transactions to buying a diseased cow, noting that even if there was some residual value, the fraud occurred in a sale that never should have taken place.

This approach is quite favorable to the government because it means that the gross amount of the mortgages at issue was the starting point for the calculating the maximum penalty rather than trying to figure out how each loan actually performed. 


Evidence Excluded from Mortgage Fraud Scheme Case

"If you rob and bank and pay them back, has a crime been committed?"

Newswest9 According to court documents, the defendants have argued that, "evidence that they have repaid many of the fraudulently obtained loans and thus, as a consequence, the banks have been or are being made whole and will not suffer any loss." 

Evidence that suggests the banks are partially responsible for not catching the fraud as it happened will also be prohibited from the case, as blaming the victim is not a defense in a mortgage fraud case. 

However, the court will allow evidence that the appraisals for the homes were legitimate.


Citigroup Offers Five Times Leverage to Bank Depositors to Trade in Foreign Currencies

It’s so crazy that one’s first instinct is that it must be a spoof web site.

Pam Martens

Wall Street on  Parade

It turns out that this is a real Citibank offering, a real Citibankweb site, and there is a similar deal being offered in Hong Kong by Citibank – one of Wall Street’s largest banks – a bank that appears hell bent on setting a Guinness World Record for the most screw ups in one decade.


It Doesn't Make Sense!

“Your Honor this is a simple foreclosure on an ordinary mortgage.” Those words, uttered by most foreclosure attorneys are very misleading. Because the attorneys don’t have the information I have, the attorney might actually think the words he or she is speaking are true. But they are not true in most cases.

I submit that if you start with the premise that the brokers started with the intent to steal the money and steal the loans, then everything DOES make sense.

Living Lies If this was an ordinary loan with an ordinary loan closing why did the banks engage in fraudulent behavior in foreclosure cases — robo-signing, forgery, fabrication and even foreclosing on loans that were neither delinquent nor properly declared in default?

Why would a lender or purchaser of loans destroy cash equivalent notes unless they had something to hide?

Why are so many foreclosures failing because they failed to prove their case (a rising number with each passing month)?


HAMP Load Mod Scandal: Bankers did not act in good faith

US Bank N.A. v Sarmiento

New York Appellate Division, Second Department Great case from NEW YORK. The court defines "good faith" in negotiating a HAMP modification and held bankster wrongfully denied a HAMP based on the home was not the owner's "primary residence" and wrongfully denied the modification a second time because the decision was based on wrong income calculations. The court held bankster did not act in good faith. 

Panel Addresses 'Bad Faith' in Foreclosure Negotiations

Fuster said the ruling gave borrowers "a sword against the lenders and they can use it immediately."

A Brooklyn appellate court has ruled that judges must weigh a range of facts when deciding whether parties failed to negotiate in good faith during mandatory foreclosure settlement conferences.

New York Law Journal From September 2009 to January 2011, the parties held 18 conferences. 

As the referee recounted in her report, the servicer made missteps such as misplacing documents and not offering more specific information when it concluded Sarmiento was ineligible. One denial was based on the erroneous grounds that no modification was needed because Sarmiento was current and not at risk of default.

All told, the amount of barred interest was about $300,000, Fuster said.

Help Campaign for Liberty Audit the Fed

Ron Paul Please sign the below petition urging your U.S. Representative to do everything in their power to achieve a standalone, roll call vote on the Audit the Fed bill (H.R. 24), including cosponsoring it if they haven't yet done so. 

After you sign your petition, please chip in to help Campaign for Liberty turn up the heat on Congress to Audit the FED! 

Theft with intent to resell claims survive!

MERSCORP Northwest Trustee and RCO in Hot Water Losing Civil Conspiracy Motion to Dismiss

"The Borrower needs to know who they are supposed to be negotiating with (Counsel and Court share a smile of common sense reasoning and logic).... The Note has to go first and the Deed of Trust is simply incident to that Transfer. If you just transfer the Deed of Trust, you've got nothing."- Brian Fisher, Esq.

YouTube This is in many ways the most important Mortgage Movie I have made, as MERS/MERSCORP, NWTS, and Routh, Crabtree did not escape a Motion to Dismiss for Civil Conspiracy to Steal and Resell... as such it is even more momentous than the Decision Reversing a sale in Bradburn v. ReconTrust, another case involving vertical integration and deceit, breach of Good Faith Covenants, etc. In essence Your Honor, the Emperor has no clothes.... and you can't bifurcate the note from the Deed of Trust. When MERS or anyone else "conveys" anything such as a Deed of Trust or Mortage by Assignment without a Note it is a legal nullity.

Significantly, the Court -- with urging from Stafne Attorney Brian Fisher captured on video -- affirmed Carpenter v. Longan 88 U.S. 271 (1872). Then there are the theft with intent to resell claims that survived as well......


Wells Fargo ruling an affront to ‘good faith’

US Bank N.A. v Sarmiento

NY Post In a decision that will have enormous ripple effects through local foreclosure cases, a powerful New York court hit Wells Fargo for failing to negotiate in good faith with a Brooklyn borrower.
The smackdown came as the court affirmed an earlier ruling on the issue, and upheld sanctions preventing Wells Fargo from collecting interest and fees on the loan since December 2009 and legal fees in this action — a total of roughly $300,000.


Foreclosure Cases Pending Across Florida PLUMMET. (But What Happens to Foreclosed Homes?)

In the foreclosure context, policy makers operating in closed door session adopted policies of CLEAR THE FORECLOSURE BACKLOG….but there is little evidence that anyone stopped to think about what it means to dump foreclosed properties into a softening market….and why in the world should we care one moment to think about the societal and personal impact of throwing a retiree or disabled person or family with kids out into the street leaving behind an abandoned zombie home that the bank will not take possession of? Indeed….why should we think about such things?

Weidner Law One last thought before we get to the data…

HOW MUCH DOES EACH FORECLOSURE (of a home abandoned by the bank) COST TAXPAYERS?

(and how could that money be better spent?)

Here’s a hint….and it’s frankly what we’re all starting to see a lot more of….


What if, instead of giving trillion dollar principal reductions to banks…we had instead offered small principal reductions to taxpayers, citizens, people?


We lawyers with a passion for justice (whether employed or not) are still in a unique position to do battle with those who belittle the concepts of Constitutional, equitable, and common law jurisprudence. It was a passion for justice which birthed this nation. That same passion for justice is needed to save our country from what it has become today.

Scott Stafne Adding a lawyer to the equation really does not change much if it is the amount of money that determines the attorneys efforts with regards to the foreclosure. The bank has an unlimited fund to pay its lawyers; defaulting homeowners are not so fortunate. Thus, in most cases the result is the same except the homeowners have spent the last of their money on a futile quest for justice. The quest is futile because it ultimately is won by the persons who has the most money; regardless of how law and equity should influence the result.


Echoes of ‘08 in court ruling

Warning: America still vulnerable to sharks on Wall Street.

BDN FEDERAL JUDGE JED RAKOFF put it this way: “(The risky mortgage program) was driven by a hunger for profits and oblivious to the harms thereby visited, not just on the immediate victims but also on the financial system as a whole.”


Wife of banker who illegally made $1M for love child: ‘We all make mistakes’ 

(Mistakes yes - crimes no.)

In addition to his prison sentence, the judge fined Hixon $100,000, and ordered him to forfeit $710,000 to the government and to pay $1,204,777.80 in restitution to Evercore.

NY Post Following 10 minutes of teary-eyed testimony, Judge Ronnie Abrams sentenced the disgraced former senior managing director of Evercore Partners to 2½ years in jail. Hixon, 55, had faced five years in prison under federal guidelines for tipping a Texas mistress to upcoming deals so she could earn enough money to support their 5-year-old daughter.


In Foreclosure Cases, Courts Allow Banks To Conceal Or Fail To Produce Records.. and still grant foreclosure?

Weidner Law THE COURT: No, no, no. Don’t say anything. I find that that’s sufficient testimony to allow that the letter be received into evidence. 


Big Banks Still a Risk

NY Times Taxpayers have a right to know exactly how much their implied guarantees are worth to these huge and politically powerful institutions. So it is unfortunate that the new study by the Government Accountability Office trying to quantify those benefits was such a muddle.

Exclusive: JPMorgan's proposed $4.5 billion deal to be accepted for most trusts

Reuters Trustees representing investors in JPMorgan Chase $4.5 billion settlement over money-losing mortgage-backed securities are expected to accept the bank's proposal for the vast majority of their trusts.


Potential home buyers are waking up.

Homeownership Rate Falls in Q2, Expected to Plummet Further

The Wall Street/mortgage industry's 'theft by deception scheme' is scaring people away.

NMP The mortgage industry is a criminal enterprise that is corrupt from top to bottom-inside and out; the GSE business model with its taxpayer-funded  guarantee is fatally-flawed; titles to tens of millions of homes are clouded; the nation's land records are stuffed with fraudulent documents, court records are filled with false statements, fabricated evidence and void judgments; all government remedies were a fraud and another cash cow for the banks; banks are stealing homes from paying customers and charging them for forced-placed insurance when they already have insurance, and the list goes on and on.

Consumer Bureau's Suit Against Law Firm Faces Big Challenge

Law firm fighting debt collection suit has won against similar claims

"This is a significant case, for it may very well involve some significant constitutional issues about the control and practice of law in this country,"

Daily Report In 2010, the state Supreme Court split 4-3 to hold that attorneys cannot be held liable for violations of the state's Fair Business Practices Act. The court majority also held that only the Supreme Court has the power to govern the practice of law in Georgia through its administration of the State Bar of Georgia's Rules of Professional Conduct. The ruling suggested that consumers who accused attorneys of abusive debt collection practices should take their complaints to the state bar or the Federal Trade Commission. The opinion also recognized that attorneys' debt collection practices "would be subject to investigation" by the FTC as the regulatory body responsible for enforcement of the federal Fair Debt Collection Practices Act.



Bank of America Ordered to Pay $1.2 BILLION for Fraudulent Mortgages

The question I continue to raise is that if there was an administrative finding of fraud by an agency of the government, which there was, and if there was a jury finding of fraud involved in the Countrywide mortgages (and other mortgages) why are we presuming in court that that the mortgage is valid?

Living Lies “Given the current environment where robo-signing became institutionalized as a practice even though it is the equivalent of forgery and where fabrication of documents by law offices and “document processors” were prepared according to a published menu of prices, why would anyone, least of all a court of law, apply general principles surrounding presumptions when established fact makes it more likely than not that the presumptions lead to the wrong conclusions? Where is the prejudice to anyone in abandoning these presumptions in light of all the information in the public domain?”
January | February | March | April | May | June | July | August | September | October | November | December

copyright MSFraud.org