Daily News related to the Foreclosure Crisis

The biggest unpunished heist in human history - Max Keiser


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Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Foreclosed nation: Wall Street, the dispossessed & the quality of American democracy

If those affected by foreclosure were a voting bloc, we'd treat the crisis as the ongoing emergency that it is

Salon Why has the continued crisis of dispossession not been treated as a national emergency? Given the scale of the foreclosure crisis, the policy response has been muted. Congress and the Obama administration have repeatedly rejected demands for a national moratorium on mortgage foreclosures. 


UPDATE: Glaski and the WAMU Trust

Affidavit of Thomas Adams

Thomas Adams I note for the Court's benefit that a transfer to the Trust on June 11, 2009 is a legal impossibility for a number of reasons.

I cannot conclude that this particular mortgage loan was ever owned by any of the parties. It is my opinion that this Trust does not own this mortgage loan.

O'Malley announces presidential run

El Paso Times "Tell me how it is, that not a single Wall Street CEO was convicted of a crime related to the 2008 economic meltdown? Not a single one," O'Malley said. "Tell me how it is, that you can get pulled over for a broken tail light, but if you wreck the nation's economy you are untouchable?"


Justices toss Washington law countering bad-faith lawsuits

The Supreme Court has struck down Washington's anti-SLAPP law that attempts to curtail lawsuits brought in bad faith to hinder public discussion.

Docket: Notice all the lawyers involved.

Seattle Times In a unanimous opinion Thursday the court said the law, enacted by the Legislature in 2010, violates the right to a trial by jury because it requires judges, not juries, to make determinations about the disputed facts of a case.

Judges frequently decide cases when the facts of a case are undisputed and the sides are arguing over matters of law. But the Supreme Court said that when facts are disputed — as they were in the Olympia Food Co-op case — the right to a jury applies.


Ocwen Closing Houston Residential Servicing Operations

MReport This decision comes after strategic review within the company in order for them to, consolidate the amount of call center sites, eliminate redundancies, and increase effectiveness within residential loan servicing operations.


JPMorgan $500M Bear Stearns Securities Deal Approved

Bear Stearns, acquired by JPMorgan in 2008, was accused in the lawsuit of issuing $17.6 billion in faulty mortgage-backed securities.

National Mortgage News According to the pension funds, offering documents shown to investors contained false and misleading statements about the securities, holding them out as the highest quality and with low risk.
"As a result of the untrue statements and omissions, plaintiffs and the class purchased certificates that were far riskier than represented, not of the 'best quality' and not equivalent to other investments with the same credit ratings."

Freddie Mac Sells $201M of Ocwen-Serviced Non Performing Loans

Freddie Mac auctioned off 1,052 delinquent nonperforming loans serviced by Ocwen on May 21 as part of its Standard Pool Offerings.

Mortgage Servicing News These loans have been delinquent for three years on average. Those auctioned were offered as a single pool of mortgage loans. Previously modified mortgages that later became delinquent comprise 29% of the aggregate pool balance.
Freddie began marketing the transaction on April 28 to minority- and women-owned businesses, nonprofit organizations, neighborhood advocacy funds and private investors active in the NPL market, among other potential bidders.


Former Short Sale Specialist Convicted of Mortgage and Tax Fraud 

The FBI investigates when a bank loses money.

FBI Stone faces a maximum penalty of 20 years in prison for each of the wire fraud and wire-fraud conspiracy charges, 30 years in prison for the charges of false statements to a bank, 25 years in prison for the fictitious obligation charges, three years for the charge of corruptly impeding the internal revenue laws, and one year for each count of willful failure to file a tax return at her Aug. 14 sentencing.


Judgment of foreclosure and confirmation of sale VACATED

Bank of America v. Russell

APPELLATE COURT OF ILLINOIS Though defendants’ November 15, 2012, motion seeking vacatur of the summary judgment was not filed within 30 days of that judgment, defendants’ challenge was not untimely. The final judgment in a mortgage foreclosure action is the order confirming the sale and ordering the distribution of proceeds. EMC Mortgage Corp. v. Kemp


Are SEC Waivers Defanging Charges Against Big Banks?

Before the banks agreed to plead guilty last Wednesday, they made sure they had in place waivers from the SEC to keep them from being automatically disqualified from operating normally.

Corporate Counsel Since 2007, the U.S. Securities and Exchange Commission has granted the five banks that signed criminal plea deals last week at least 19 waivers to continue normal operations despite their misconduct, with at least seven of them going to UBS AG. And the latest round of waivers last week sparked a deepening dissent at the SEC.


A bank is not the holder in due course upon merely crediting the depositors account. Bankers Trust v. Nagler, 23 A.D.2d 645, 257 N.Y.S.2d 298 (1965).

Unknown It is not necessary for rescission of a contract that the party making the misrepresentation should have known that it was false, but recovery is allowed even though misrepresentation is innocently made, because it would be unjust to allow one who made false representations, even innocently, to retain the fruits of a bargain induced by such representations.” Whipp v. Iverson, 43 Wis. 2d 166, 168 N.W.2d 201 (1969).

Fair Debt Collection Practices Act Case Law Citations

jp Belin V. Litton Loan Serv., L.P., 2006 WL 1992410 (M.D. Fla. July 14, 2006). The employees of a debt collection agency who actually engaged in the allegedly unlawful misconduct and the collection agency itself are jointly and severally liable for the resulting FDCPA violations.

Debt Forgiveness Could Save This Woman's Home, But Nation's Housing Chief Still Says No

Huff Post Warren cited a Congressional Budget Office report from 2013 that determined a modest principal reduction plan could help 1.2 million borrowers and save Fannie and Freddie -- and by extension taxpayers -- $2.8 billion.

Pros se reversal


(Aurora and 123Loan involved)

We are mindful of the perception that certain delinquent borrowers might enjoy a “windfall” where a foreclosure plaintiff is required to prove standing to enforce a note at the time the initial complaint is filed, but the filing of a new suit when standing has been acquired would take place more than five years after the alleged default. Proof of entitlement to enforce a note secured by a mortgage can be problematic in “this era of securitization of mortgage debt and computerized banking.”

Florida 1st District Court of Appeals “[i]n this case and numerous other cases, the financial institutions have brought these problems upon themselves by the complex methods of securitization and their own sloppy recordkeeping.” We further note that many foreclosure actions languish due to the plaintiffs’ failure to prosecute cases in a timely manner and not from any wrongdoing by the borrower. Once a defendant contests the plaintiff’s standing as the proper party to enforce a note via foreclosure, the plaintiff’s right to bring suit on the note at the requisite time becomes a disputed issue the plaintiff must prove. Gee v. U.S. Bank, N.A., 72 So. 3d 211, 213 (Fla. 5th DCA 2011). It is not inequitable to require a plaintiff to prove its case, beginning with its standing to bring the action at the outset when that status is challenged.


America will die old and broke: The systematic right-wing plot to ransack the middle-class nest egg

Despite what conservatives say, the safety net works—which is why the 1 percent wants to stage a hostile takeover

David Dayen As a member of Generation X, I’ve spent my adult life riding waves of bubbles, watching housing values implode, retirement accounts halved and job prospects evaporate. With each subsequent crisis, I and my cohort are asked to “give up a little more” to help the country “recover,” even as a tiny fraction of people and corporations reach unprecedented, unimaginable levels of wealth. This disparity is unsustainable.


Damage Claims Against OneWest Goes to Jury, Summary Judgment reversed

The question now is: What difference does it make if the borrower is in default if the foreclosing party had no right to foreclose? 


The judgment is reversed with respect to Banayan's claims for promissory fraud,
negligent misrepresentation, concealment, promissory estoppel, negligence, wrongful foreclosure. 

Living Lies With the current judicial climate changing in favor of borrowers, [including findings that the mortgage was absolutely void (invalid, non-perfected) where a sham nominee like MERS was used], Judges should take note that they are better off getting in front of the new trend and allow borrowers’ claims to be heard in a fair manner, observing the requirements of due process.

I suspect that the trial judge will allow more liberal discovery after being reversed. And if that happens you might not never hear about this case again — as it joins the tens of thousands of cases that have been settled under seal of confidentiality. Essentially the strategy of the banks is that if they lose, they can always pay off the homeowner to keep the case from being publicized.


Banks as Felons, or Criminality Lite

Citicorp, JPMorgan Chase, Barclays and Royal Bank of Scotland are felons, having pleaded guilty on Wednesday to criminal charges of conspiring to rig the value of the world’s currencies. According to the Justice Department, the lengthy and lucrative conspiracy enabled the banks to pad their profits without regard to fairness, the law or the public good.

NY Times Besides the criminal label, however, nothing much has changed for the banks. And that means nothing much has changed for the public. There is no meaningful accountability in the plea deals and, by extension, no meaningful deterrence from future wrongdoing. In a memo to employees this week, the chief executive of Citi, Michael Corbat, called the criminal behavior “an embarrassment” — not the word most people would use to describe a felony but an apt one in light of the fact that the plea deals are essentially a spanking, nothing more.


Employees of Butler & Hosch Foreclosure-Mill File WARN Act Class Action

dbr They say the firm, which represented lenders and servicers, failed to provide 60 days' written notice as required by the federal Worker Adjustment and Retraining Notification Act. Without the notice, Regal and Hillis said the mass layoffs deprived hundreds of workers and their families of a transition period to adjust to their new unemployed status.



SIGTARP Since at least 2013, they defrauded distressed homeowners throughout parts of New York. They falsely represented to these homeowners – some of whom were elderly or in poor health – that they could assist them with a loan modification or similar relief from foreclosure that would allow the homeowners to save their homes. But rather than actually assisting these homeowners, the defendants deceived  them into selling their homes to Launch Development LLC, a for-profit real estate company also affiliated with the defendants.


Reporter: "We now turn to the felons on Wall Street."

Banks Admit to Crimes, Pay $5 Billion, And Still No One Goes to Jail

Matt Taibbi interviewed on Democracy Now After years of pressure from some lawmakers, civic leaders and Occupy Wall Street protesters, the country’s No. 1 law enforcer said Tuesday he has instructed many of his 93 federal prosecutors to review any residential mortgage fraud case they have brought against a financial institution stemming from the 2008 financial crisis to see if any executive could be held accountable for the company’s actions.

Both civil and criminal cases will be on the table, Holder said.


Fraud enforcement official arrested for mortgage fraud

Feds charge he submitted false application for loan modification

Housing Wire Specifically, Patrick claimed total assets of $500 in one checking account to show that he had experienced a loss of income causing a hardship when, in fact, he had thousands of dollars spread out over multiple accounts at several institutions and his rate of pay had not diminished.



We reject the lender's contentions and affirm the judgment in favor of plaintiffs. Even though the surviving spouse had a right to sell the property, that right did not convert her life estate into a fee simple estate. The lender had no rights in the property upon the death of the surviving spouse.

Court of Appeals of California, Second District, Division Five A probate court ordered the distribution of real property to a surviving spouse who executed and recorded a deed of trust on the real property in favor of a lender to secure a loan. When the surviving spouse died, and payments were not made on the loan, the lender recorded a notice of default and election to sell the real property. Plaintiffs, who purported to have a remainder fee interest in the real property, brought an action, inter alia, to quiet title to the property. They claimed that the surviving spouse only had a life estate in the real property and had no power to encumber it. 

Prison Sentence For Attorney Who Ran Million-Dollar Mortgage Fraud Scheme

NY AG Defendant Theresa Sanders Sentenced To Up To 7 Years in Prison, Ordered to Pay Over $500,000 in Restitution, And Must Surrender Law License

Schneiderman: Anyone Who Seeks To Exploit New York Families Will Be Brought To Justice

“This ring preyed on hard-working New Yorkers who were merely trying to fulfill their dreams of buying a first home,” said Attorney General Eric Schneiderman. 


Another Lawyer Tagged For Running Bogus Foreclosure Rescue/Loan Modification Racket

Home Equity Theft Reporter A commission hearing officer ruled that David Zak provided “substandard service to Latino clients because of their national origin” and should pay 17 families more than $220,000 in damages. Whether they will receive any compensation is uncertain as Zak has filed for bankruptcy.


Ohio's Eighth District Court of Appeals The trial court committed plain error in granting summary judgment in favor of Fannie Mae and against Hicks. Fannie Mae has failed to establish its right to enforce the note and, in turn, the mortgage. Accordingly, Hicks is entitled to judgment as a matter of law.


The Hurdles for Banks After Guilty Pleas

Exemptions sought from the Labor Dept. over restrictions on pension fund management.

NY Law Journal In the elite world of multibillion-dollar Wall Street banks, the U.S. Department of Labor rarely looms large.
That changed this week. The agency will play a key role in determining whether five megabanks that pleaded guilty to criminal charges can effectively participate in the $7 trillion pension fund market.

Cash-Strapped Servicers Fill Gaps by Borrowing Against Their MSRs

National Mortgage News Mortgage bankers facing new demands on their businesses are becoming increasingly interested in new sources of liquidity, particularly through mortgage servicing rights financing vehicles.

Palm Beach County Trial Win for The Law Offices of Evan M. Rosen

The Judge knew exactly what 1.130(a) stated and immediate said to the Plaintiff’s attorney, “I reviewed the pleadings just a few minutes ago and in 30 seconds I saw what you and your firm should have seen 4 years ago, and yet, you have done nothing to fix!”

Also see: Judge Has Enough, Tells Bank Lawyer She is Referring Him to The Bar in Our Latest Trial Win!

Rosen Law Plaintiff attorney keeps limping forward, trying to put in the Mortgage, POA and AOM. I’m still doing my thing, objecting and seeking to voir dire as appropriate along the way, but then the Judge erupts on the Plaintiff’s attorney,What are you doing? There is no way you can or are going to win this case! The note is not coming in to evidence! Why are you wasting our time!?!? Speak to your client or whomever and come back in here in 5 minutes and advise if you can take a different course of action then the one you are taking.” P comes back and announces they will take a Voluntary Dismissal! CASE DISMISSED!


NY AG Scores Default Judgment Against Bogus Foreclosure Defense Attorney 

The judgment ordered Litvin Law Firm; Litvin, Torrens & Associates, PLLC; and the firms’ principal attorney Gennady Litvin to immediately halt their illegal business practices, including preying upon financially vulnerable consumers by claiming to provide a comprehensive legal services plan that would allow consumers to avoid foreclosure.

Home Equity Theft Reporter If you believe you were a victim of the Litvin Law Firm or Litvin, Torrens & Associates – or if you believe you were a victim of another mortgage fraud – please file a complaint with the Attorney General’s Office. Complaint forms can be completed online here. You may also call the Attorney General’s Consumer Hotline at 1-800-771-7755.

For similar "attorney ripoff reimbursement funds" that attempt to clean up the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Directory Of Lawyers' Funds For Client Protection 

Key Cases for the Sheriff of Wall Street

Wall Street’s Nemesis, Benjamin Lawsky, to Resign in June



naked capitalism

Benjamin M. Lawky’s four-year tenure as New York’s overseer of banking and insurance shook up the sleepy world of financial regulation in New York.

Lawsky is not going the revolving door route but instead is starting a new firm.

California Court Pierces the Curtain of Secrecy on WAMU Deals

Plaintiffs’ claims for wrongful foreclosure, quiet title, cancelation of instruments, violation of Section 2923.5, and unjust enrichment survive to the extent that they are premised on the theory that WaMu sold its entire interest in the Loan in 2008.


Living Lies This decision finally brings the real issue to the forefront: who, if anyone, actually has the legal status of creditor or the right to claim ownership of the debt, loan, note or mortgage? In this case the Court correctly centered on the real issue: if WAMU had ALREADY sold the loan before it “sold” the loan to a trust or anyone else, then the entire chain is not just defective, or corrupted, it is void. And then you have quiet title, wrongful foreclosure and probably RICO although that does not seem to be in the pleadings for this case.










Banks fined $2.5 billion, to plead guilty to market rigging

The criminal behavior took place between December 2007 and January 2013, according to the agreement.

AP JPMorgan Chase, Citigroup, Barclays and The Royal Bank of Scotland conspired with one another to fix rates on U.S. dollars and euros traded in the huge global market for currencies, according to a settlement announced Wednesday between the banks and U.S. Justice Department. Currency traders allegedly shared customer orders through chat rooms and used that information to profit ahead of their clients.

5 Banks To Plead Guilty To Criminal Rigging Charges, Pay $5.6 Billion For Manipulating Markets

Tyler Durden Don't be surprised if despite the guilty criminal pleas, nobody goes to prison yet again.

In any event, we now know that aside from Libor, FX, gold, stocks and treasuries, nothing else is manipulated. he-he-he

Bank of America fined $205M for foreign-exchange mispractices

Charlotte Observer Bank of America is being fined $205 million for shoddy practices in the foreign-exchange market, the Federal Reserve said Wednesday in announcing civil penalties against five other major banks for similar conduct.

Bank of America was left out of the 5 banks that settled with the Justice Department, but included with the same banks in being fined by the Federal Reserve for the same activities. Why?

5 Banks to Pay Billions and Plead Guilty in Currency and Interest Rate Cases

One Barclay's employee said: “If you ain’t cheating, you ain’t trying.

"This Department of Justice intends to vigorously prosecute all those who tilt the economic system in their favor; who subvert our marketplaces; and who enrich themselves at the expense of American consumers,” Attorney General Loretta E. Lynch said on Wednesday.

DealBook Adding another entry to Wall Street’s growing rap sheet, five big banks have agreed to pay about $5.6 billion and plead guilty to multiple crimes related to manipulating foreign currencies and interest rates.

The guilty pleas, which the banks are expected to enter in federal court in Connecticut on Wednesday, represent a first in a financial industry that has been dogged by numerous scandals and investigations since the 2008 financial crisis. Until now, banks have either had their biggest banking units or small subsidiaries plead guilty. But with the four banks charged with currency violations, the guilty pleas will come from their parent companies.


Bank and Title Insurer Left Holding The Bag When Borrower Died As Remaindermen Come Forward, Claiming Free & Clear Title To Collateral

Peterson v. Wells Fargo

Home Equity Theft Reporter The trial court voided Jacqueline's 2003 deed and all the subsequent instruments (ie. the $416,000 Wells Fargo mortgage, the notice of default, etc.), and quieted title to the home in the names of the two sons.
For the reasons set forth in the appeals court ruling, the appellate court affirmed the trial court ruling.


Another Nationstar executive stepping down

Hisey’s departure comes on the heels of Lewis’ resignation and retirement and just after Nationstar posted a surprising loss in the first quarter, driven somewhat by a loss of servicing revenue.

Housing Wire Nationstar's first-quarter servicing segment revenue of $109 million fell 49% from Q4, mostly due to higher prepayments as rates fell, the company said earlier this month.

Those results led several analysts to downgrade the company. Analysts from FBR Capital Markets, Oppenheimer and Barclays (BCS) issued significant reductions to Nationstar’s price targets, and in one case, a downgrade from “market perform” to “underperform.”


Thomas Ice: Ocwen Lawyer Spoon-Fed Questions and Answers to Robo-Witnesses


dbr "My conclusion is that it's pretty clear—from what she's saying and the document that she attaches—that they've been doing what I've been saying they were doing all along: telling clients want to say," Ice said. "These are listed out for the attorneys to ask the witness, and the answers that the witness needs to give are right there. I find that to be extremely telling. It's exactly what we thought was going on. When they talk about training of the witness, they're teaching them what to say at trial, and it doesn't matter whether it's true or not."


Lawsky Touts Foreclosure Reforms to Ease Burden on Courts, Servicers

"This is a problem long in the making, Lawsky said.

Coinciding with his speech, Lawsky's office published an 18-page report detailing the source of delays in the state's foreclosure process and recommendations for improving its efficiency.

National Mortgage News Lawsky said: "Truly vacant and abandoned properties should not be afforded the same lengthy judicial foreclosure process in place for borrowers still living in their homes. Foreclosure fast-tracking initiatives in Suffolk, Nassau and Bronx counties have yielded positive results, and "it's time to take the best of these trial programs and employ them statewide.
Approximately 30% of all foreclosed homes are abandoned either after the first notice of foreclosure action or at some point throughout the process." 


REMIC Trusts: VOID means VOID — Not Voidable

The New York statute says that any act in contravention of the express terms of the Trust instrument is void.

Living Lies None of the Trusts actually come to own the debt, loan, note or mortgage anyway. The creation of “assignments” and “powers of attorney” merely create the illusion of a transaction that never occurred.

Acts of a trustee in contravention of the trust agreement are void.[1] Here the act of Plaintiff-In-Intervention which is void is its late acceptance of the loan into the trust. Although Defendant is aware of cases holding such acts are merely voidable, such cases rest upon a misunderstanding of New York law.

No Statute of Limitations on VOID Deed

Bank of America Nearly Gets NY Courts To Set Aside Over A Century Of Case Law

Faison v. Bank of America

The legal question raised in this appeal is whether plaintiff Dorothy Faison is time-barred under CPLR 213 (8) from seeking to set aside and cancel, as null and void, defendant Bank of America's mortgage interest in real property conveyed on the authority of a forged deed.

Home Equity Theft Reporter The Court of Appeals reversed, holding that the statute of limitations in section 213(8) did not foreclose Plaintiff’s claim against Defendant because, under prior case law, a forged deed is void ab initio, and as such, any encumbrance upon real property based on a forged deed is null and void.

Under our prior case law it is well-settled that a forged deed is void ab initio, meaning a legal nullity at its inception. As such, any encumbrance upon real property based on a forged deed is null and void.

Therefore, the statute of limitations set forth in CPLR 213 (8) does not foreclose plaintiff's claim against defendant. As the Appellate Division affirmed the dismissal of plaintiff's claims as time-barred, we now reverse.


This Former Bank Regulator Quit His Job to Fight For His House 

The true ownership of millions of mortgages issued during the housing bubble was fatally corrupted, and now it's impossible to prove who actually legally controls those mortgages.

Despite a career in banking, Mains was unable to sort out a seemingly simple question: Who did he owe money to?

Banks may have flaunted the rules so aggressively they lost their right to collect mortgage payments.


Mains lost in the trial court and the appellate court affirmed.

David Dayen If Mains or his allies succeed, they would rip open a wound that virtually everyone in power has tried to stitch up and forget. But such a long-awaited victory wouldn't make up for the years of stress and personal hardship Mains has suffered, including a failed marriage and now the end of his career in public service.

"I had to ask myself a question: Will I do this no matter if it hurts?" Mains told me. "I said yes. If I can afford to fight these suckers and bring this illegality to light, that's why I went to law school."

In a 2013 case called Phoenix Light v. JPMorgan Chase, investors surveyed the transfer history for 274 loans in a Chase trust, and found that none of the mortgages and notes were conveyed properly before the closing date. A 2012 case against Barclays Bank looked at three other securitizations, similarly finding that 99 percent of the mortgages were either unassigned to the trusts or assigned improperly.


Many on Wall Street Say It Remains Untamed

Virtually all the large firms said that if there was bad behavior, it is behind them.

Well, it isn’t.

DealBook A new report on financial professionals’ views of their industry paints a troubling picture. Rather than indicating that Wall Street has cleaned itself up, it suggests that many of the lessons of the crisis still haven’t been learned. And the mind-boggling settlement numbers, as well as stringent new rules, like the of Dodd-Frank regulatory overhaul in 2010, appear to have had little deterrent effect.



Attorney Beth Findsen uses Deutsche Bank as a speed-bag.


(Denying DB's Motion to Vacate Judgment)

Ken McLeod One of the disturbing aspects of this case is McLeod won and quieted the title in 2008. Deutsche Bank refuses to accept the fact that they lost this case against a pro se homeowner. Deutsche Bank is running out of courtrooms and attorneys, as it has repeatedly lost in Federal Court, State Court, and lost all of its appeals. This year, Deutsche claimed the 2008 judgment is void or “cannot possibly affect any rights of Defendant”. Today, the court denied Deutsche again, and is now awarding attorney fees to McLeod's new counsel, Beth Findsen.





Opposition to RICO: SLORP v. Lerner, Smapson

Racketeering Lawsuit over Robo-Signing Can Proceed



Living Lies





Doucet & Associates

The key element here is the Court’s determination that the lawyers were misleading the court by characterizing the homeowner’s claim as seeking damages for a false assignment. The Sixth Circuit correctly analyzed the situation and arrived at the simple conclusion: if BOA didn’t have any right to foreclose the mortgage then it doesn’t matter whether or not the homeowner defaulted.
The importance of this finding, finally, in a somewhat conservative court cannot be understated. It might well be as important as the Jesinoski decision. The reason it is so important is that this means that the primary assumption by virtually all courts in the land is turned upside down. That assumption is that if the borrower defaulted it doesn’t matter who is foreclosing. 



Texas Foreclosure-Mill Closes Down

All 700 employees let go.

The firm is tied to the illegal foreclosure criminal network.

Law firm of Butler and Hosch, P.A closes its doors overnight with a memo to employees on 5/14. Their website says that the firm provides “cradle to grave” service in all aspects of real estate and mortgage serving law (eviction, foreclosures, litigation, loss mitigation, REO, Title) since 1972 all under one roof.

Housing Wire Award and recognition: LPS Attorney Performance “Best in State” award for foreclosure and bankruptcy.
Additional information sent to MSFraud: A quote from an employee on Glass door: Pros “None to speak of at this point…Can list a whole laundry list of cons, nothing more to say… the company had gone under Cons “Everything about [firm] is a con…. (posted 5/14) Posted 5/13: Pros There is a lot of dating within the company pool; Cons: “Disfunction junction. Ethics not a thing at [firm] “The problems with management are exacerbated by the problems with the off shore employees. Manilla employees speak almost zero English. Just enough to merge a pleading and fill in some blanks. There is no quality control and only one native English speaker in the entire Manilla office. And then management is “shocked” when client systems are updated incorrectly or pleadings are filled with blatant errors.”


Why foreclosure and securitization don't mix

It is time for judges to dust off the principle of fundamental fairness that lies at the heart of our legal system, demand a level playing field, and stand behind alternatives to foreclosure that serve the legitimate interests of homeowner and industry alike.

Cape Cod Times This raises a compelling question: Is there anyone with a present contractual connection to you or the loan who has actually suffered a default? If not, any subsequent foreclosure begins to bear an uncanny family resemblance to double-dipping.
This isn’t to suggest that you’re entitled to a free lunch. But it does mean that no one should have the legal right to take your home merely by winking and nodding their way around a significant flaw in the securitization model. 

Jury assesses $82 million verdict against debt collection firm

Two years ago, a Kansas City woman learned she was being sued for not paying a credit card debt of $1,130.14.

The debt was not hers, she said. Yet the debt collection firm kept demanding that she pay.

Kansas City Star A Kansas City law firm filed a counterclaim on the woman’s behalf, alleging malicious prosecution and violation of a federal fair debt collection act by the national debt collection firm.

This week, a Jackson County jury awarded $251,000 in damages to Maria Guadalupe Mejia Alcantara and assessed $82 million in punitive damages against the debt collection firm, Portfolio Recovery Associates LLC.


Bank Of America: Too Big (And Failing)

BofA will pay another $315 million to settle a lawsuit stemming from the losses that occurred during the Ocala Funding debacle.

Seeking Alpha Over the past several years, the company has paid $58 billion in litigation fees and settlements since the financial crisis.
By comparison, rival Wells Fargo currently has a dividend yield of 2.5 percent, while BofA's yield is under 1 percent.
Another alternative, little-known PNC Financial is outperforming BofA by a wide margin.
We suggest investors strongly consider other financial stocks as alternatives to BAC.


Breaking Laws in the Mortgage Bubble

The government’s victory in this case raises an interesting question:

NY Times If the relatively unknown housing finance agency could prevail over foreign banks, why haven’t far more powerful regulators and prosecutors at the Department of Justice and the Securities and Exchange Commission done more to expose and redress wrongdoing by big Wall Street banks in the mortgage bubble?

I was physically threatened by a judge because I defend foreclosures.

I recently had one of the most disturbing experiences I’ve ever had as a lawyer; I was threatened by a judge who was coming over his desk and glaring and scowling at me in a very intimidating manner. The whole experience was grotesquely disturbing.

Weidner Law The moment the attorney said it took four hours to try a foreclosure case, the judge became even more aggressive and hostile to me…literally coming up out of his chair, huffing and grinding his jaw directly at me a comment to the effect of, how in the world was this guy allowed to waste four hours of court time trying a “simple” foreclosure case? (All the while coming out of his chair and literally looking like he would physically attack me.) 

As the travesty of the judicial system known as foreclosure funding winds down, this experience will forever be seared into my brain as the perfect expression of the system gone wrong.


Flagstar Denied Summary Judgment Based upon Suspicion of Filing False Documents


SUPERIOR COURT OF ARIZONA The record is replete with factual questions including but certainly not limited to whether the Lender properly assigned the Note and DOT and whether MERS could act as a designated beneficiary of the DOT. While the Court has serious concerns about the accuracy of the filings, the materiality of the alleged misrepresentations provide at least one additional question of fact.



Long Island Exchange Attorney General Eric T. Schneiderman today obtained a default judgment in New York County Supreme Court against two law firms and their lead attorney for participating in a fraudulent mortgage rescue scheme. The judgment ordered Litvin Law Firm; Litvin, Torrens & Associates, PLLC; and the firms’ principal attorney Gennady Litvin to immediately halt their illegal business practices, including preying upon financially vulnerable consumers by claiming to provide a comprehensive legal services plan that would allow consumers to avoid foreclosure. 


Bank of America's woes test 'Fixer' CEO

Market Watch Bank of America boss Brian Moynihan went to Central Congregational Church in Providence, R.I., one frigid Thursday night in February to talk about the second-largest U.S. bank’s commitment to [social responsibility]. - WSJ


The Legal Power of ‘Standing’

It just goes to show the importance of jurisdiction. Recently, the Supreme Court added a new case to its docket for next year, Spokeo v. Robins, which is about a technical question of jurisdiction — when a plaintiff has “standing” to sue in federal court. 

NY Times This implicates the question of standing, for the Supreme Court’s precedents have held that to bring a federal lawsuit you need to be seeking a remedy for an imminent or actual injury.

The big dispute is over what kind of injury is required. Supporters of this kind of suit say that this choice is up to Congress. If Congress creates a new legal right, it can let people sue to enforce it.


Five Signs of the Trouble in Servicing Transfers

National Mortgage News It's no longer acceptable to rely on trailing documents to fill in missing gaps in servicing data because they can jeopardize an MSR sale and potentially hurt borrowers. 

Regulators are concerned about the potential harm that MSR transfers can have on consumers, particularly distressed borrowers in the process of seeking loss mitigation workouts.


Chase to Purchase $45 Billion in Mortgage Servicing Rights from Ocwen

Seeking Alpha Buying this prime servicing book will improve the [quality]?? of our servicing portfolio and will help drive a stronger and less volatile mortgage business, said Chase Mortgage Banking CEO Kevin Watters. We expect the portfolio, in addition to lower delinquency rates overall, will help improve the value of our business. How will buying junk improve its quality of servicing? Mortgage servicing fraud was an integral part of the foreclosure crisis. 


5 Big Banks Expected to Plead Guilty to Felony Charges, but Punishments May Be Tempered

But no execs, natch. And the summary is straight Lanny Breuer redux:

DealBook As much as prosecutors may want to punish the banks, accused of rigging the price of currencies, they are mindful that too harsh a penalty could imperil the businesses.

Do we give other criminal enterprises a break because we might hurt their business? There are plenty of competitors in the FX market. It’s not as if trading would suffer if these players wound up reducing their footprint. - Yves Smith

Black neighborhoods in Cleveland are hurt by Fannie Mae's neglect of foreclosed homes, civil rights group says

Cleveland Another mortgage giant has been accused of discriminating against minorities in Cleveland by failing to take care of foreclosed homes it owns in black neighborhoods, while taking very good care of foreclosed homes in white neighborhoods


Judge Denies Group’s Whistle-Blower Standing in Suit Against U.S. Bank

A federal judge this week dismissed an innovative lawsuit that had threatened to open a new front in the legal assault on the foreclosure practices of large banks.

DealBook When a borrower defaults on such mortgages, the government makes payments to the bank that made the loan to make it whole. The F.H.A.’s rules require banks to work with defaulting borrowers to find ways to become current on their loans.

But the legal aid group claimed that U.S. Bank did not follow those rules in many cases. By not fulfilling the requirement to work with borrowers on defaulted mortgages, and by collecting money for such loans from the F.H.A., U.S. Bank made “false claims” against the government, the group contended.


Texas Federal Court grants declaratory judgment on Statute of Limitations defense, grants Quiet Title and other relief.

Callan v. Deutsche Bank

Callan has satisfied her burden to demonstrate that an actual controversy exists between the parties and that she is entitled to a declaration that more than four years have expired since Deutsche’s cause of action
accrued and its lien on the Property has expired. Her claim for declaratory judgment is granted. Deutsche’s lien on the property is void. Callan’s claim for relief to quiet title is granted.




Two of those suspected illegitimate “lenders” were America’s Wholesale Lender and America Brokers Conduit (which wasn’t registered until 2012, despite the fact that tens of thousands of mortgages and deeds of trust were issued in its name prior to its formal registration).

Note & Mortgage VOID:

Bank of America v. Nash (10/14)

Clouded Titles Bank of America, N.A. thinks that because its predecessor, Countrywide Home Loans, Inc. claims to have used AWL as a “dba” or “doing business as” assumed name, this may NOT be stated as such on your mortgage or deed of trust. Instead, you may see “America’s Wholesale Lender”, a New York corporation (which of course AWL never was). Do you see a pattern of fraud here? 

Many homeowners were foreclosed on by these two “dba’s” alleged successors, wherein the Final Judgment described above describes the lack of standing to the contrary of what was asserted by Bank of America. This is a real problem for B of A. 


Bank gives man foreclosed house for free

"This is crazy," attorney David Goldman said as he looked over the files at the Times-Union's request.

"They won," he said referring to the mortgage holder. "They're standing at the goal line, and they just need to sell the house."

Florida Times Union The court file says that Laspina lost his foreclosure case in February 2009. A sale date was set, then postponed and then cancelled, all at the plaintiff's request, later that year.

But the next year, the plaintiff requested that it all be vacated - the suit, the judgment, all of it. In October, Circuit Judge Waddell Wallace signed the order.

In December, officials for MERS, which acted as the mortgage holder, signed and filed the documents saying it "has received full payment and satisfaction ... and does hereby cancel and discharge said mortgage." (MERS has no legal right to receive payments, or cancel and discharge.)


Appellate court holds that debt collector's use of Ohio attorney general's letterhead violated FDCPA

Gillie v. Law Office of Eric A. Jones, LLC.

Public Citizen

h/t HETR

The Sixth Circuit Court of Appeals issued an opinion on Friday holding that private attorneys under contract with the Ohio attorney general’s office to collect debts owed to the state improperly used the office’s letterhead to scare debtors into paying. The court held that use of the letterhead of the Ohio attorney general’s office was a “false, deceptive or misleading” communication in violation of the Fair Debt Collection Practices Act.


RBS, Nomura Scorched in Mortgage Fraud Case

361-page Opinion & Order

Courthouse News In a devastating, 361-page ruling, a federal judge reamed RBS Securities and Nomura Holdings for offering documents on mortgage-backed securities that reached "enormous" heights in the "magnitude of falsity."
The decision comes in an action that the Federal Housing Finance Agency filed against RBS, Nomura and 15 other financial institutions in September 2011, alleging violations of the Securities Act of 1933 and other statutes.


RESCISSION: What will MBS Rating Agencies Do Now?


We know that upon TILA Rescission, the parties in the chain must cough up the canceled promissory note, file a satisfaction of mortgage, and return all monies paid by or on behalf of the borrower. That is a huge liability.

Living Lies  Who pays that? Is it the investor because they are now the creditor? Investor appetite for that kind of liability is virtually nil because most of them are stable managed funds (e.g., pension funds that require Triple AAA rated investments). Is it the bank or servicer claiming the right to foreclose or otherwise enforce the note? Banks and servicers won’t like that since they don’t consider themselves the lenders. But under Dodd-Frank, they have trapped themselves. They foreclose and claim all the “benefits” of foreclosure, including deficiency judgments. How can they now say they are not liable for disgorgement required under TILA rescission?


BoA and JPMChase to clear bad debts from consumer records

The Times estimates the changes could help more than one million Americans, who labor under erroneously marred credit reports. 

Public Citizen Why the change? The two banks (and several others) were sued for ignoring bankruptcy discharges so that they could sell off consumers’ debt and enable the debt buyers to make a profit because the consumers, facing marks against their credit score, had an incentive to pay off the debts even though they no longer legally owed them.


California Secretary of State The Notary Public Handbook contains California laws relating to notaries public and is designed to assist an applicant in preparing for the notary public examination. Refer to the current version of the handbook when preparing for the examination.

Oral Arguments Set in in CFPB v. Hanna Law Firm

The case has meaningful implications for law firm collection activity and beyond. The parties have taken firm positions. As of this point, it appears that any settlement is unlikely.

insideARM The lawsuit has garnered significant attention within the ARM industry and the legal community.

The suit was originally filed by the CFPB in July of last year. The CFPB alleged that the firm was a “lawsuit mill” that churned out debt collection actions and violated the FDCPA en masse.

A Loan Modification Program’s Limited Reach

A federal inspector is taking the Treasury Department to task for not doing enough to increase participation in the government’s Home Affordable Modification Program, known as HAMP, which helps keep homeowners out of foreclosure.

The office of the special inspector general's latest quarterly report to Congress

NY Times Mark McArdle, the chief of the Treasury’s Homeownership Preservation Office, said officials had yet to see an increase in defaults from the roughly 60,000 loans that have reached their first rate step-up. The median payment increase is about $95 a month. 

He noted changes made last year to help mitigate the increases. Borrowers who stay current on their modified loan for six years can receive up to $10,000 in incentives toward their principal balance. And borrowers in danger of default may be evaluated for a second modification at a reduced rate.


No Statute of Limitations to Quiet Title Action

Salazar v. Thomas

Notices of default under a void deed of trust provided notice of a cloud on title, but did not dispute or disturb the possession of the property; the statute of limitations does not bar their action.

Because the wrong sought to be remedied- the cloud on plaintiff’s title—is ongoing, the period for limitation begins anew each day; a limitation defense can never arise to bar a typical suit to quiet title. [see Watson v. Rochmill, Tex. 565, 155 S.W.2d 783, 785 (1941)]

California Court of Appeals Statute of Limitations: at least one case has suggested that a § 33-420 (b) claim asserts a continuous wrong that is not subject to any statute of limitations as long as the cloud to title remains. State v. Mabery Ranch, Co., 165 P.3d 211, 227 (Ariz. Ct. App. 2007).

Dittmar v. Alamo Nat'l Co., 132 Tex. 44, 118 S.W.2d 298, 301-302 (1938)-applying remedy to quiet title to personality]. To paraphrase an early opinion of the Texas Supreme Court, the action enables the holder of the feeblest equity to remove from his or her way to the title any unlawful hindrance having the appearance of a better right [Thomson v. Locke, 66 Tex. 383, 1 S.W. 112, 115 (1886); see Bell v. Ott, 606 S.W.2d 942, 952 (Civ. App.Waco 1980, ref. n.r.e.)-quoting from Thomson v. Locke].


Fraud Action Reinstated Against Goldman Sachs

New York Law Journal The Court of Appeals Thursday reinstated a fraud action against Goldman Sachs & Co. for allegedly inducing an insurer to cover a mortgage-backed security that was designed to fail.
The 5-2 majority reversed a finding by the Appellate Division, First Department, which found in 2013 that ACA Financial Guaranty Corp. failed to establish that it justifiably relied on misrepresentations by Goldman to sustain causes of action for fraud in the inducement and for fraudulent concealment.


Bank of America’s Relief for Mortgage Borrowers Is Questioned

Gretchen Morgenson

NY Times

Because troubled borrowers often have many unsecured debts, such cases would typically generate far less for Bank of America, often as little as 10 percent of the outstanding value on a second lien. Still, Mr. Parker said, the bank may try to submit the entire amount for credit.

“These settlements always look better on paper,” he said.



Jeff Barnes, Esq. Florida law provides that a judgment can be opened or vacated if it was obtained by fraud, or if it is void, and also has a “crime/fraud” exception to the attorney/client privilege which does not protect communications between a party and its attorney if those communications were made in furtherance of the perpetration of or for the purpose of committing a crime or fraud even if the crime or fraud is not consummated. Fla.Stat. sec. 90.502 as explained in First Union National Bank v. Turney, 824 So.2d 172 (Fla. 1st DCA 2001). Obviously the fraudulent Stern foreclosures were “completed”.


Federal government sues Green Tree Servicing over its collection practices

The suit could have broad and long-lasting implications for all homeowners, both those whose mortgages are serviced by Green Tree and those not. 


Sandusky Register The allegations serve as a wake-up call to homeowners to be constantly vigilant of the potential for mortgage servicing fraud. That fraud may come in the form of a denial of a loan modification, a refusal to recognize an already-agreed-to modification, erroneous billings, collection harassment, false credit reporting or in countless other ways.

Whatever your situation may be, the key to mortgage success is ferreting out the fraud and turning it back on the servicer.


Connecticut State Official Accused Of Mortgage Modification Fraud

In an ironic twist, a Connecticut state employee who manages fraud investigations for the state's welfare department has been charged with mortgage modification fraud.


Department of Justice

This matter is being investigated by the Connecticut Public Corruption Task Force, which includes the U.S. Department of Health and Human Services Office of Inspector General, U.S. Department of Housing and Urban Development Office of Inspector General, Federal Bureau of Investigation, U.S. Postal Inspection Service and Internal Revenue Service Criminal Investigation Division. The case is being prosecuted by Assistant U.S. Attorney Christopher M. Mattei.

(We can't get one of them to look at a single Mod-Fraud case committed by the banks.)


The Foreclosure Crisis Caused a Great Migration in Miniature

Several commentators picked up on the relationship between the events in Baltimore and the dearth of economic opportunity that leads to a sense of hopelessness. But precious few added the component of the foreclosure crisis, a dislocating event that has few parallels in American history.

David Dayen A new paper in the American Sociological Review by Matthew Hall (Cornell), Kyle Crowder (University of Washington) and Amy Spring (Georgia State) puts numbers to this, and shows that we really had a small-scale version of the Great Migration, the shift of African-Americans from the rural south to the big cities of the north. This migration hollowed out and segregated African-American and Latino communities to an even greater degree than where they already were.

Ocwen Fails Loan Mod Compliance Test in Mortgage Settlement

Mortgage Servicing News Ocwen Financial failed a test to determine whether it had notified borrowers of missing or incomplete documents for loan modifications in a timely manner.


Ouch! Mortgage Fraud Costs Convicted Banker $38 Million

"The size of the judgment was meant to send a message to our community that banks must vigilantly watch out for mortgage fraud and bank employees will pay if they assist in fraudulent schemes," said attorney Andrew Moss. 

dbr "Wachovia knew or should have known that Bermudez was unfit to work as a bank employee in general and a licensed financial specialist in particular based upon his history of dishonesty and ethical lapses," the complaint said. "Wachovia negligently failed to supervise and/or terminate Bermudez, when any reasonable bank would have done so no later than Oct. 1, 2005."


Try a Personal Injury Lawyer

I have been advising people for quite some time to approach personal injury lawyers for representation in foreclosure defense. They have no preconceived notions about homeowners as deadbeats and they litigate for a living. The contrast with bankruptcy and real estate lawyers is that neither tends to have a lot of court experience.

Living Lies PI lawyers know how to fight. I am seeing more and more people taking my advice and having good results. And the foreclosure defense business tends to lead to referrals for personal injury work. So the lawyer makes money in foreclosure defense, makes money on the personal injury cases and can even make a ton of money on wrongful foreclosure cases --- considering the fact that most foreclosures are wrongful.


Harvard Law School's Amicus Brief Condemns MERS

MERS helped precipitate the foreclosure crisis and left homeowners
without recourse to protect their property rights.

MERS increased the costs of enforcing property rights and left homeowners without recourse to challenge wrongful foreclosures.

Court proceedings and federal agency investigations have further exposed the inaccuracy of records in the MERS database.

Harvard Law School MERS, as Christopher Peterson has written, “was an important cog in the machine that churned out the millions of unsuitable, poorly
underwritten, and incompletely documented mortgages that were destined for foreclosure” in the recent mortgage crisis.

The principal issue that has caused foreclosures to be set aside has been the inability of many foreclosing lenders to produce the original mortgage note when called upon to do so.

MERS and its member banks
apparently lost or mistakenly destroyed loan documents” in thousands of cases, and often confused and misrepresented which entities owned mortgage notes."

Now read the MASS. AG's "FIX" to consummate the banks' crimes, sanitize MERS damage, and cover-up title fraud...

Void Foreclosure Relief

"If the bank performed a void foreclosure on your property, it will provide assistance to you to remedy the void foreclosure and clear the title to the property." --- even though that bank never owned the property and has no legal authority to clear the title!


Attorney General

Under Massachusetts law, a bank, or other foreclosing entity, must strictly comply with the state’s foreclosure laws in order to transfer the ownership of a property through foreclosure. When a party conducting a foreclosure does not strictly follow the foreclosure laws, the foreclosure is “void.” People who purchase properties after a void foreclosure may have a title defect that could prevent them from refinancing their mortgage or selling the property.

Downstream purchasers of properties upon which one of the bank defendants conducted a void foreclosure any time after December 1, 2007 may be eligible for non-monetary assistance to clear title.


Homeowner Faces 5 Years for Falsifying Mortgage Documents

Home Equity Theft Reporter Apparently, banksters have de facto immunity from prosecution for the crime of "False Declaration Before Court" when engaging in similar conduct (ie. creating and submitting phony documents in court in connection with a foreclosure matter).


Fraud on the Court as a Basis for Dismissal with Prejudice or Default: An Old Remedy Has New Teeth

That cheaters should not be allowed to prosper has long been central to the moral fabric of our society and one of the underpinnings of our legal system.

Florida Bar Journal Sanctions, in a wide variety of shapes, attempting to encompass the virtually limitless ways litigants manage to misbehave have always been part and parcel of our legal system. Dismissal with prejudice has long been available as the ultimate civil sanction against litigation misconduct, but is often bypassed in the belief that such efforts rarely succeed at the trial court level and are frequently reversed on appeal when they do. In the past this sentiment was understandable. Older appellate decisions upholding dismissals with prejudice for “fraud on the court” were decisively outnumbered by decisions reversing such dismissals as being too severe.



Clouded Titles Quiet title actions will become fundamentally commonplace because of what the MERS business model has done to contribute to the corruption of any chain of title it’s involved with. I will NOT buy a property that has MERS anywhere in the chain of title! I suggest you take my comment to heart here, especially if you’re an investor. 


Everything you ever wanted to know (and more) about MERS and why it cannot be a beneficiary under a deed of trust.

Erickson v. Green Tree

The rampant abuse of the MERS nominee status and purported beneficiary status by document preparation services in concert with loan servicers, allegations calling into question the authority of MERS to assign a deed of trust, are
always plausibly stated.

Homeowner Advocacy Project The word “nominee” … connotes … a representative or nominal capacity only, and does not connote the transfer or assignment to the nominee of any property in or ownership of the rights of the person nominating him. MERS cannot legally be the beneficiary. MERS may only assign any interest that it held; not more, not less. “An assignee steps into the shoes of her assignor. She ‘can stand in no better position than the assignor’ and ‘[a]n assignment cannot alter the defenses or equities of the third party.’”

The Assignment states on its face that it was prepared by “NTC” (Nationwide Title Clearing), a well-known foreclosure mill document preparation service. The FAC alleges that the signer, Ashley Braband, is not with CWHL or MERS, but rather is an employee of Nationwide Title Clearing.


BNP Paribas Sentenced for Conspiring to Violate the International Emergency Economic Powers Act and the Trading with the Enemy Act

BNPP was sentenced to a five-year term of probation, and ordered to forfeit $8,833,600,000 to the United States and to pay a $140,000,000 fine. 

Department of Justice BNP Paribas S.A. a global financial institution headquartered in Paris, was sentenced today for conspiring to violate the International Emergency Economic Powers Act (IEEPA) and the Trading with the Enemy Act (TWEA) by processing billions of dollars of transactions through the U.S. financial system on behalf of Sudanese, Iranian and Cuban entities subject to U.S. economic sanctions. Today’s sentencing is the first time a financial institution has been convicted and sentenced for violations of U.S. economic sanctions, and the total financial penalty—including the forfeiture and criminal fine—is the largest financial penalty ever imposed in a criminal case.
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