THE BIGGEST SCUMBAG BANK, DEUTSCHE BANK, ON EARTH…

 

 

FORECLOSURE FRAUD – DEUTSCH BANK MEMO NOTIFIES SECURITIZED LOAN SERVICERS AND THEIR ATTORNEYS THAT THEY MAY HAVE BROKEN THE LAW

Posted by Foreclosure Fraud on November 3, 2010 · 1 Comment

First some excerpts from ForeclosureDefenseNationwide

In an October 25, 2010 letter from Deutsche Bank to “All Holders of Residential Mortgage Backed Securities For Which Deutsche Bank National Trust Company or Deutsche Bank Trust Company Americas Acts As Securitization Trustee”, DB reports on “alleged deficiencies” in certain foreclosure proceedings and advises of the prior issuance, by the DB Trustee, of an “Urgent and Time-Sensitive Memorandum” dated October 8, 2010 to its Securitization Loan Servicers regarding servicing foreclosure procedures, demanding that the servicers “comply with all applicable laws relating to foreclosures”.

The October 8, 2010 “Urgent and Time Sensitive” Memorandum attached to the October 25, 2010 Memo makes things even more interesting. Here are some select quotes:

“The Governing Documents typically require the Trustee to furnish the Servicer with powers of attorney that allow the Servicer to sign documents and institute legal actions, including foreclosure proceedings, in the name of the Trustee on behalf of the Trusts in connection with these servicing activities…. Recent media reports suggest that the Alleged Foreclosure Deficiencies may include the execution and filing by certain servicers and their agents of potentially defective documents, possibly containing alleged untrue assertions of fact, in connection with certain foreclosure proceedings. The reported scope of such alleged practices raises the possibility that such documents may have been filed in connection with foreclosure proceedings relating to mortgage loans owned by the Trusts and may have been executed under color of one or more powers of attorney granted to Servicers pursuant to the Governing Documents. Any such actions by a servicer or its agents would constitute a breach of that Servicer’s obligations under the Governing Documents and applicable law.”

So what we have here is DB tacitly admitting that its servicers and attorneys “possibly” filed fraudulent foreclosure documents (which we all know did in fact happen, with “robo-signer” assignments, backdated notaries, etc.), which if done “under color of” required powers of attorney, is illegal on more than one front.

Well isn’t that interesting…

Full memo, plus others, below…

Enjoy!

~

4closureFraud.org

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SCUMBAG COLONIAL Bank Sues State Lawmaker

Sarah Buduson
Reporter, KPHO.com

SCOTTSDALE, Ariz. — Ariz. Rep. Michele Reagan, R-District 8, is better known for fighting for new laws, but now, she is speaking about her fight against a lawsuit.

 

Reagan is being sued by her mortgage company after she questioned who owned held the note on her home. 

“It’s really scary,” she said, “I think that this really needs to be brought to light that this is happening to people in Arizona.” 

Reagan had wanted to find out she and her husband, David Gulino, could refinance their south Scottsdale home. 

“In doing research, I began to wonder if the lender even owned the note to my home,” she said. “So I sent them a letter and asked them and asked them several things. I want to know who owns my property. Am I paying the right person?” 

Soon after, Colonial Savings filed a lawsuit in U.S. District Court against Reagan and her husband. The company says the couple is trying “to rescind their home loan,” or back out on the loan. 

“We’re not interested in walking,” Reagan said. “We’re not interested in saying we’re not going to pay. We just need a little help with the interest rate.” 

“I’m current on my loan. Never missed a payment. We’ve never been late. We were sued for asking too many questions,” said Reagan. 

As a state lawmaker, Reagan said she had been hesitant to speak out about her ordeal. 

“This has now snowballed into something so much bigger and scarier than refinancing and asking who owns your note,” she said. 

With a state senate campaign on the horizon, she feared some people may get the wrong impression about the lawsuit, but she ultimately decided speaking out was the right thing to do. 

“I finally thought if this could happen to me, how many people has happened to mean to or that means it could happen to people without the resources I have,” she said. “Even with all the information that I have and all the contacts I have, they scared the bejesus out of us and that was their intent and it worked.” 

CBS 5 News attempted to contact Colonial Savings and its attorneys, but has yet to receive a comment.

 

Oct. 18, 2010 — Foreclosures In Missouri Wayne Godsey, KMBC President And General Manager

HOW MUCH $ IS THIS SCUMBAG AG GETTING PAID BY THE BANKSTERS?

POSTED: 7:27 pm CDT October 18, 2010


KANSAS CITY, Mo. — Missouri Attorney General Chris Koster made the right call when he chose not to interfere with home foreclosures in the state. 

Koster’s decision was in response to a request from Kansas City Mayor Mark Funkhouser and a group called Communities Creating Opportunities. 

It is sad to see anyone lose their home, particularly when it’s the result of a lost job or other unfortunate circumstances. But many people simply paid too much for homes, thinking that values could only increase. 

Some lenders like Bank of America and Chase have voluntarily suspended foreclosures in order to review internal procedures. If faulty practices exist, they say they’ll correct them. 

But a government-dictated moratorium is a bad idea, just like the government lending policies that created the mortgage crisis. If individuals can’t pay their mortgages, foreclosures are necessary to stabilize the real estate market, for the benefit of homeowners and lenders alike.

 

Scumbag Judge needs your help..

If someone has a picture of Erin “culo” Cullaro, please send to us for posting.. Thanks


BOUT TIME – AG’S OFFICE REPRIMANDS ERIN CULLARO FOR “FORECLOSURE MILL” WORK

ANOTHER SCUMBAG P.O.S INVESTIGATED. ERIN “CULO” CULLARO OF THE FLORIDA DEFAULT LAW CRIMINALS..

Posted by Foreclosure Fraud on October 21, 2010 ·

AG’S OFFICE REPRIMANDS ITS ATTORNEY FOR “FORECLOSURE MILL” WORK

By SHANNON BEHNKEN | The Tampa Tribune

TAMPA – The Florida Attorney General’s Office has reprimanded one its attorneys for notarizing documents for one of the “foreclosure mills” the office is investigating. Erin Cullaro, an assistant attorney general for the office’s Economic Crimes Division in Tampa, is a former employee of Tampa-based Florida Default Law Group.

The Attorney General is investigating the firm, along with three other Florida firms, for what “appears to be fabricating and/or presenting false and misleading documents in foreclosure cases.”

Cullaro was given permission from the Attorney General’s Office in April 2008 for dual employment, allowing her to notarize law firm documents for 15 minutes three days a week.

But, according to the written reprimand, Cullaro failed to renew the application into the new fiscal year, “which would have altered the {Attorney General’s Office } to your continued outside employment and accurately reflected the time commitment involved.”

In addition, the reprimand says, “your continued dual employment created an appearance of impropriety” because the attorney general’s office was inquiring into the practices of foreclosure law firms. The reprimand states that Cullaro’s says she quit her notary role before the formal investigation begun. Even so, she could ultimately lose her job, according to the reprimand. Tom Ice of Ice Legal in West Palm Beach represents homeowners in foreclosure and wants to question Cullaro about documents she signed in some of his cases. Her signature varies drastically and court documents assert she signed off on documents while out of town on business with the attorney general’s office.

Court documents reviewed by the Tribune show Erin Cullaro’s signature varied from a full, cursive signature to a squiggly “E.” When she signed the reprimand letter, she used the “E.”

You can check out the rest of the story here…

For those who do not the story behind the Cullaro’s, it is a must see link…

LINK – SCANDALOUS – SUBSTANTIATED ALLEGATIONS OF FORECLOSURE FRAUD THAT IMPLICATES THE FLORIDA ATTORNEY GENERAL’S OFFICE AND THE FLORIDA DEFAULT LAW GROUP

Posted by Foreclosure Fraud on March 26, 2010 ·

Pay attention all! We have been sitting on this information for some time now due to ongoing investigations but since the cat is out of the bag here we go… Over at  Matt Weidner’s Blog He reports on the transcript and motion from a hearing held in a Volusia County Courtroom from Ice Legal. Bombshell- … Read more

 

Battle Lines Forming in Clash Over Foreclosures

By GRETCHEN MORGENSON and ANDREW MARTIN

About a month after Washington Mutual Bank made a multimillion-dollar mortgage loan on a mountain home near Santa Barbara, Calif., a crucial piece of paperwork disappeared.

But bank officials were unperturbed. After conducting a “due and diligent search,” an assistant vice president simply drew up an affidavit stating that the paperwork — a promissory note committing the borrower to repay the mortgage — could not be found, according to court documents.

The handling of that lost note in 2006 was hardly unusual. Mortgage documents of all sorts were treated in an almost lackadaisical way during the dizzying mortgage lending spree from 2005 through 2007, according to court documents, analysts and interviews.

Now those missing and possibly fraudulent documents are at the center of a potentially seismic legal clash that pits big lenders against homeowners and their advocates concerned that the lenders’ rush to foreclose flouts private property rights.

That clash — expected to be played out in courtrooms across the country and scrutinized by law enforcement officials investigating possible wrongdoing by big lenders — leaped to the forefront of the mortgage crisis this week as big lenders began lifting their freezes on foreclosures and insisted the worst was behind them.

Federal officials meeting in Washington on Wednesday indicated that a government review of the problems would not be complete until the end of the year.

In short, the legal disagreement amounts to whether banks can rely on flawed documentation to repossess homes.

While even critics of the big lenders acknowledge that the vast majority of foreclosures involve homeowners who have not paid their mortgages, they argue that the borrowers are entitled to due legal process.

Banks “have essentially sidestepped 400 years of property law in the United States,” said Rebel A. Cole, a professor of finance and real estate at DePaul University. “There are so many questionable aspects to this thing it’s scary.”

Others are more sanguine about the dispute.

Joseph R. Mason, a finance professor who holds the Louisiana Bankers Association chair at Louisiana State University, said that concerns about proper foreclosure documentation were overblown. At the end of the day, he said, even if the banks botched the paperwork, homeowners who didn’t make their mortgage payments still needed to be held accountable.

“You borrowed money,” he said. “You are obligated to repay it.”

After freezing most foreclosures, Bank of America, the largest consumer bank in the country, said this week that it would soon resume foreclosures in about half of the country because it was confident that the cases had been properly documented.GMAC Mortgage said it was also proceeding with foreclosures, on a case-by-case basis.

While some other banks have also suggested they can wrap up faulty foreclosures in a matter of weeks, some judges, lawyers for homeowners and real estate experts like Mr. Cole expect the courts to be inundated with challenges to the banks’ actions.

“This is ultimately going to have to be resolved by the 50 state supreme courts who have jurisdiction for property law,” Professor Cole predicted.

Defaulting homeowners in states like Florida, among the hardest hit by foreclosures, are already showing up in bigger numbers this week to challenge repossessions. And judges in some states have halted or delayed foreclosures because of improper documentation. Court cases are likely to hinge on whether judges believe that banks properly fulfilled their legal obligations during the mortgage boom — and in the subsequent rush to expedite foreclosures.

The country’s mortgage lenders contend that any problems that might be identified are technical and will not change the fact that they have the right to foreclose en masse.

“We did a thorough review of the process, and we found the facts underlying the decision to foreclose have been accurate,” Barbara J. Desoer, president of Bank of America Home Loans, said earlier this week. “We paused while we were doing that, and now we’re moving forward.”

Some analysts are not sure that banks can proceed so freely. Katherine M. Porter, a visiting law professor at Harvard University and an expert on consumer credit law, said that lenders were wrong to minimize problems with the legal documentation.

“The misbehavior is clear: they lied to the courts,” she said. “The fact that they are saying no one was harmed, they are missing the point. They did actual harm to the court system, to the rule of law. We don’t say, ‘You can perjure yourself on the stand because the jury will come to the right verdict anyway.’ That’s what they are saying.”

Robert Willens, a tax expert, said that documentation issues had created potentially severe tax problems for investors in mortgage securities and that “there is enough of a question here that the courts might well have to resolve the issue.”

As the legal system begins sorting through the competing claims, one thing is not in dispute: the pell-mell origination of mortgage loans during the real estate boom and the patchwork of financial machinery and documentation that supported it were created with speed and profits in mind, and with little attention to detail.

Once the foreclosure wheels started turning, said analysts, practices became even shoddier.

For example, the foreclosure business often got so busy at the Plantation, Fla., law offices of David J. Stern — and so many documents had to be signed so banks could evict people from their homes — that a supervisor sometimes was too tired to write her own name.

When that happened, Cheryl Samons, the supervisor at the firm, who typically signed about 1,000 documents a day, just let someone else sign for her, court papers show.

“Cheryl would give certain paralegals rights to sign her name, because most of the time she was very tired, exhausted from signing her name numerous times per day,” said Kelly Scott, a Stern employee, in a deposition that the Florida attorney general released on Monday. A lawyer representing the law firm said Ms. Samons would not comment.

Bill McCollum, Florida’s attorney general, is investigating possible abuses at the Stern firm, a major foreclosure mill in the state, involving false or fabricated loan documents, calling into question the foreclosures the firm set in motion on behalf of banks.

That problem extends far beyond Florida.

As lenders and Wall Street firms bundled thousands of mortgage loans into securities so they could be sold quickly, efficiently and lucratively to legions of investors, slipshod practices took hold among lenders and their representatives, former employees of these operations say.

Banks routinely failed to record each link in the chain of documents that demonstrate ownership of a note and a property, according to court documents, analysts and interviews. When problems arose, executives and managers at lenders and loan servicers sometimes patched such holes by issuing affidavits meant to prove control of a mortgage.

In Broward County, Fla., alone, more than 1,700 affidavits were filed in the last two years attesting to lost notes, according to Legalprise, a legal services company that tracks foreclosure data.

When many mortgage loans went bad in the last few years, lenders outsourced crucial tasks like verifying the amount a borrower owed or determining which institution had a right to foreclose.

Now investors who bought mortgage trusts — investment vehicles composed of mortgages — are wondering if the loans inside them were recorded properly. If not, tax advantages of the trusts could be wiped out, leaving mortgage securities investors with significant tax bills.

For years, lenders bringing foreclosure cases commonly did not have to demonstrate proof of ownership of the note. Consumer advocates and consumer lawyers have complained about the practice, to little avail.

But a decision in October 2007 by Judge Christopher A. Boyko of the Federal District Court in northern Ohio to toss out 14 foreclosure cases put lenders on notice. Judge Boyko ruled that the entities trying to seize properties had not proved that they actually owned the notes, and he blasted the banks for worrying “less about jurisdictional requirements and more about maximizing returns.”

He also said that lenders “seem to adopt the attitude that since they have been doing this for so long, unchallenged, this practice equates with legal compliance.” Now that their practices were “put to the test, their weak legal arguments compel the court to stop them at the gate,” the judge ruled.

Yet aside from the actions of a few random judges, little was done to force lenders to change their practices or slow things down. Since March 2009, more than 300,000 property owners a month have received foreclosure notices or lost their home in a foreclosure, according to RealtyTrac, which tracks foreclosure listings.

What finally prompted a re-examination of the foreclosure wave was the disclosure in court documents over the last several months of so-called robo-signers, employees like Ms. Samons of the Stern law firm in Florida who signed affidavits so quickly that they could not possibly have verified the information in the document under review.

Lenders and their representatives have sought to minimize the significance of robo-signing and, while acknowledging legal lapses in how they documented loans, have argued that foreclosures should proceed anyway. After all, the lenders say, the homeowners owe the money.

People who have worked at loan servicers for many years, who requested anonymity to protect their jobs, said robo-signing and other questionable foreclosure practices emanated from one goal: to increase efficiency and therefore profits. That rush, they say, allowed for the shoddy documentation that is expected to become evidence for homeowners in the coming court battles.

For example, years ago when banks made loans, they typically stored promissory notes in their vaults.

But the advent of securitization, in which loans are bundled and sold to investors, required that loan documents move quickly from one purchaser to another. Big banks servicing these loans began in 2002 to automate their systems, according to a former executive for a top servicer who requested anonymity because of a confidentiality agreement.

First to go was the use of actual people to determine who should be liable to a foreclosure action. They were replaced by computers that identified delinquent borrowers and automatically sent them letters saying they were in default. Inexperienced clerical workers often entered incorrect mortgage information into the computer programs, the former executive said, and borrowers rarely caught the errors.

Other record-keeping problems that are likely to become fodder for court battles involve endorsements, a process that occurs when notes are transferred and validated with a stamp to identify the institution that bought it. Eager to cut costs, most institutions left the notes blank, with no endorsements at all.

Problems are also likely to arise in court involving whether those who signed documents required in foreclosures actually had the authority to do so — or if the documents themselves are even authentic.

For example, Frederick B. Tygart, a circuit court judge overseeing a foreclosure case in Duval County, Fla., recently ruled that agents representing Deutsche Bankrelied on documents that “must have been counterfeited.” He stopped the foreclosure. Deutsche Bank had no comment on Wednesday.

Cynthia Veintemillas, the lawyer representing the borrower in the case, Patrick Jeffs, said the paperwork surrounding her client’s foreclosure was riddled with problems.

“Everybody knows the banks screwed up and loaned out money to people who couldn’t pay it back,” she said. “Why are people surprised that they don’t know what they are doing here either?”

Meanwhile, another judge on Wednesday indicated that the courts would not simply sign off on the banks’ documentation. Jonathan Lippman, the chief judge of New York’s courts, ordered lawyers to verify the validity of all foreclosure paperwork.

“We cannot allow the courts in New York State to stand by idly and be party to what we now know is a deeply flawed process, especially when that process involves basic human needs — such as a family home — during this period of economic crisis,” Judge Lippman said in a statement.

 

Former secretary says signatures were faked at {SCUMBAG} law firm being investigated over foreclosures

The Associated Press

By MIKE SCHNEIDER and TAMARA LUSH Associated Press Writers
ORLANDO, Fla. October 18, 2010 (AP)
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An office manager at a Florida law firm under investigation for fabricating foreclosure documents would sign her name to 1,000 files a day without reviewing them and would allow paralegals to sign her name for her when she got tired, her former secretary said in a deposition released Monday.

Cheryl Salmons, office manager for the foreclosure department at the law offices of David Stern, would sign 500 files in the morning and another 500 files in the afternoon without reviewing them and with no witnesses, said former assistant Kelly Scott in a deposition released by the Florida attorney general’s office.

The files were laid out on a conference room table for Salmons to sign, the former secretary said.

“She doesn’t review them. She just looks,” Scott said. “The paper is going to be in the top folder so it’s visible to her, and she knows exactly where she has to put her signature.”

Paralegals would then collect the files and swap them with each other, signing them as witnesses even though they had already been notarized and executed, Scott said.

Salmons allowed some paralegals to sign her name for her, said the former assistant, who worked at the firm for a year in 2008.

“Most of the time she was very tired, exhausted from signing her name numerous times per day,” Scott said. “You have to understand it was more than 500 files that she is signing morning and afternoon.”

The deposition took place two weeks ago as part of the attorney general’s investigation into the law firm.
Another deposition released Monday was of Mary Cordova, who worked at G&Z Process for two months. Stern’s law firm used G&Z as a process server for foreclosures.

Cordova said when she was hired, she was told that she needed to process at least 22 cases per eight-hour shift.

“It was almost like we didn’t have time to really look at what we were doing,” she said during her deposition. “It’s like this is the particular information, input that, turn that page, here’s this piece of information, type that in. It’s more about speed than accuracy per se. Although a supervisor would look at the papers to see if they’re pretty accurate.”

Jeffrey Tew, an attorney for Stern’s firm, didn’t immediately return a phone call.

Matt Weidner, a St. Petersburg attorney who has been defending homeowners whose paperwork was signed by lawyers in Stern’s office, said the latest depositions reveal that lawyers aren’t abiding by the rules and judges aren’t doing their jobs by scrutinizing foreclosure cases.

“I am literally getting to the point of speechlessness,” Weidner said. “The federal government has to come in and take control of the Florida foreclosure court system. If this stuff is occurring, it’s a crisis of confidence in our courts. It really calls into question the legitimacy of a court system.”

.

 

CLASS ACTION AGAINST THE MAJOR SCUMBAG LAWFIRMS

Below is a Class Action against all the major SCUMBAG law firms defrauding people.

class56

Fannie and Freddie’s Foreclosure Scumbag Barons

— Illustration: Lou Beach

How fishy foreclosures earned millions for lawyers like David J. Stern—and made the housing crisis even worse.

— By Andy Kroll

[Editor’s note: In November 2009, MoJo reporter Andy Kroll received a tip about a little-known yet powerful firm, the Law Offices of David J. Stern, which handled staggering numbers of foreclosures in southeastern Florida—the throbbing heart of nation’s housing crisis. Among the allegations, the tipster had it from insiders that Stern employees were routinely falsifying legal paperwork in an effort to push borrowers out of their homes as quickly—and profitably—as possible.

Kroll spent eight months investigating Stern’s firm and its ilk—a breed of deep-pocketed and controversial operations dubbed “foreclosure mills.” After sifting through thousands of pages of court documents, interviewing scores of legal experts and former Stern employees, and attending dozens of foreclosure hearings in drab Florida courtrooms, he emerged with a portrait of a law firm—indeed, an entire industry—that was willing to cut corners, deceive judges, and even (allegedly) commit fraud—all at the expense of America’s homeowners.

When his story first broke online on August 4, it generated lots of buzz. Columbia Journalism Review called it the “must-read of the month” and “a great piece of muckraking journalism.” News sites from the Huffington Post on the left to the Daily Caller on the right featured it on their front pages. But the crucial response came from the authorities: Six days after Kroll’s story went live, Florida Attorney General Bill McCollum announced an investigation into Stern’s firm and two others. In September, the New York Times followed with a lengthy piece on Florida’s foreclosure mess and Stern’s operation in particular. A few weeks after that, further revelations of robo-signed paperwork and law firms gaming the courts have plunged the industry into chaos, with banks freezing foreclosures from Maine to California and members of Congress railing against the mortgage companies.

“Foreclosuregate,” as some have dubbed the crisis, may ultimately force David J. Stern to unload a few of his Ferraris. As Kroll noted in one of his many followup posts, Fannie Mae and Freddie Mac—as well as banks GMAC and Citigroup—recently stopped sendingforeclosure cases Stern’s way. As of October 19, his publicly traded paper-pushing wing, DJSP Enterprises, wallowed around $1.30 a share, down from $6 in June. The companyhas reportedly laid off nearly 100 employees, and recently announced a major reshuffling of top leadership—with Stern himself relinquishingthe chairmanship of DJSP’s board of directors. Here, then, is Kroll’s story much as it appears in our November/December 2010 print edition…]

LATE ONE NIGHT IN February 2009, Ariane Ice sat poring over records on the website of Florida’s Palm Beach County. She’d been at it for weeks, forsaking sleep to sift through thousands of legal documents. She and her husband, Tom, an attorney, ran a boutique foreclosure defense firm called Ice Legal. (Slogan: “Your home is your castle. Defend it.”) Now they were up against one of Florida’s biggest foreclosure law firms: Founded by multimillionaire attorney David J. Stern, it controlled one-fifth of the state’s booming market in foreclosure-related services. Ice had a strong hunch that Stern’s operation was up to something, and that night she found her smoking gun.

It involved what’s called an “assignment of mortgage,” the document that certifies who owns the property and is thus entitled to foreclose on it. Especially these days, the assignment is key evidence in a foreclosure case: With so many loans having been bought and sold, establishing who owns the mortgage is hardly a trivial matter. By law, a firm must compete, sign, and notarize an assignment before it attempts to seize somebody’s home.

A Florida notary’s stamp is valid for four years, and its expiration date is visible on the imprint. But here in front of Ice were dozens of assignments notarized with stamps that hadn’t even existed until months—in some cases nearly a year—after the foreclosures were filed. Which meant Stern’s people were foreclosing first and doing their legal paperwork later. In effect, it also meant they were lying to the court—an act that could get a lawyer disbarred or even prosecuted. “There’s no question that it’s pervasive,” says Tom Ice of the backdated documents—nearly two dozen of which were verified by Mother Jones. “We’ve found tons of them.”

This all might seem like a legal technicality, but it’s not. The faster a foreclosure moves, the more difficult it is for a homeowner to fight it—even if the case was filed in error. In March, upon discovering that Stern’s firm had fudged an assignment of mortgage in a case before her court, a judge in central Florida’s Pasco County dismissed the case with prejudice—an unusually harsh ruling that means it can never again be refiled. “The execution date and notarial date,” the judge wrote in a blunt ruling, “were fraudulently backdated, in a purposeful, intentional effort to mislead the defendant and this court.”

Stern has made a fortune foreclosing on homeowners. He owns a $15 million mansion, four Ferraris, and a 130-foot yacht.

More often than not in uncontested cases, missing or problematic documents simply go overlooked. In Florida, where foreclosure cases must go before a judge (some states handle them as a bureaucratic matter), dwindling budgets and soaring caseloads have overwhelmed local courts. Last year, the foreclosure dockets of Lee County in southwest Florida became so clogged that the court initiated rapid-fire hearings lasting less than 20 seconds per case—”the rocket docket,” attorneys called it. In Broward County, theepicenter of America’s housing bust, the courthouse recently began holding foreclosure hearings in a hallway, a scene that local attorneys call the “new Broward Zoo.” “The judges are so swamped with this stuff that they just don’t pay attention,” says Margery Golant, a veteran Florida foreclosure defense lawyer. “They just rubber-stamp them.”

But the Ices had uncovered what looked like a pattern, so Tom booked a deposition with Stern’s top deputy, Cheryl Samons, and confronted her with the backdated documents—including two from cases her firm had filed against Ice Legal’s clients. Samons insisted that the filings were just a mistake, so the Ices moved to depose the notaries and other Stern employees. On the eve of those depositions, however, the firm dropped foreclosure proceedings against the Ices’ clients.

It was a bittersweet victory: The Ices had won their cases, but Stern’s practices remained under wraps. “This was done to cover up fraud,” Tom fumes. “It was done precisely so they could try to hit a reset button and keep us from getting the real goods.”

On August 10, just days after this story first broke at MotherJones.com, Florida Attorney General Bill McCollum launched an investigation of three of the state’s largest foreclosure firms, including Stern’s, citing dubious paperwork. “Thousands of final judgments of foreclosure against Florida homeowners may have been the result of the allegedly improper actions of these law firms,” he told the New York Times, which wrote about the state’s foreclosure mess in September.

Backdated documents, according to a chorus of foreclosure experts, are typical of the sort of shenanigans practiced by a breed of law firms known as “foreclosure mills.” While far less scrutinized than subprime lenders or Wall Street banks, these firms undermine efforts by government and the mortgage industry to put struggling homeowners back on track at a time of record foreclosures. (There were 2.8 million foreclosures in 2009, and 3.8 million are projected for this year.) The mills think “they can just change things and make it up to get to the end result they want, because there’s no one holding them accountable,” says Prentiss Cox, a foreclosure expert at the University of Minnesota Law School. “We’ve got these people with incentives to go ahead with foreclosures and flood the real estate market.”

PAPER TRAIL

View the documents featured in this story:

Federal Securities Fraud SuitCooper and Methi v. DJSP Enterprises, David J. Stern, and Kumar Gursahaney, July 2010

Class Action Racketeering SuitFigueroa v. MERSCORP, Law Offices of David J. Stern, and David J. Stern, July 2010

Fair Debt Collection Violation SuitHugo San Martin and Melissa San Martin v. Law Offices of David J. Stern, July 2010

Class Action Suit for Fair Debt Collecting ViolationsRory Hewitt v. Law Offices of David J. Stern and David J. Stern, October 2009

Florida Bar, Public ReprimandComplaint Against David J. Stern, Sept. 2002

Florida Bar, Public ReprimandConsent Judgment Against David J. Stern, Oct. 2002

Freddie Mac Designated Counsel, Retention Agreement with Law Offices of David J. Stern, April 2003

Freddie Mac Designated CounselMemo to Law Offices of David J. Stern, March 2006

Amended Complaint Alleging Sexual HarassmentBridgette Balboni v. Law Offices of David J. Stern and David J. Stern, July 1999

Stern’s is hardly the only outfit to attract criticism, but his story is a useful window into the multibillion-dollar “default services” industry, which includes both law firms like Stern’s and contract companies that handle paper-pushing tasks for other big foreclosure lawyers. Over the past decade and a half, Stern (no relation to the NBA commissioner) has built up one of the industry’s most powerful operations—a global machine with offices in Florida, Kentucky, Puerto Rico, and the Philippines—squeezing profits from every step in the foreclosure process. Among his loyal clients, who’ve sent him hundreds of thousands of cases, are some of the nation’s biggest (and, thanks to American taxpayers, most handsomely bailed out) banks—including Wells Fargo, Bank of America, and Citigroup. “A lot of these mills are doing the same kinds of things,” says Linda Fisher, a professor and mortgage-fraud expert at Seton Hall University’s law school. But, she added, “I’ve heard some pretty bad stories about Stern from people in Florida.”

While the mortgage fiasco has so far cost American homeowners an estimated $7 trillion in lost equity, it has made Stern (no relation toNBA commissioner David J. Stern) fabulously rich. His $15 million, 16,000-square-foot mansion occupies a corner lot in a private island community on the Atlantic Intracoastal Waterway. It is featured on a water-taxi tour of the area’s grandest estates, along with the abodes of Jay Leno and billionaire Blockbuster founder Wayne Huizenga, as well as the former residence of Desi Arnaz and Lucille Ball. (Last year, Stern snapped up his next-door neighbor’s property for $8 million and tore down the house to make way for a tennis court.) Docked outside is Misunderstood, Stern’s 130-foot, jet-propelled Mangusta yacht—a $20 million-plus replacement for his previous 108-foot Mangusta. He also owns four Ferraris, four Porsches, two Mercedes-Benzes, a Cadillac, and aBugatti.

Despite his wealth and his power over other people’s fates, Stern operates out of the public eye. His law firm has no website, he is rarely mentioned in the mainstream business press, and neither he nor several of his top employees responded to repeated interview requests for this story. Stern’s personal attorney, Jeffrey Tew, also declined to comment. But scores of interviews and thousands of pages of legal and financial filings, internal emails, and other documents obtained by Mother Jones provided insight into his operation. So did eight of Stern’s former employees—attorneys, paralegals, and other staffers who spoke on condition of anonymity, fearing that speaking publicly about their ex-boss could harm their careers.

One paralegal said Stern grabbed female employees from behind and faked sex with them. Former employees describe him as a “pig.”

FORECLOSURE MILLS OWE their existence to Fannie Mae and Freddie Mac, the federally guaranteed entities that essentially created, beginning in 1968, the vast marketplace where loans are traded. Their mandate was to promote homeownership by making a large pool of credit available at affordable rates. They accomplished this by buying up mortgage debt from banks and packaging it into bonds, allowing investors to get in on the action. Banks responded by lending out more money, and Fannie and Freddie’s combined mortgage portfolio exploded from $61 billion in 1980 to $1.2 trillion two decades later, according to the Government Accountability Office. Their dominance gave them the clout to rewrite rules for the mortgage industry—standardizing underwriting guidelines, loan documents, and the like.

Fannie and Freddie also reshaped the foreclosure industry. Their huge holdings meant they had to deal with thousands of foreclosures annually—even during time when relatively few loans were going bad. In the 1990s, the market expanded into subprime territory to feed the securitization beast, and borrowers began defaulting at higher rates. Hiring lawyers on a case-by-case basis was burdensome, so Fannie and Freddie put together a stable of law firms willing to litigate large bundles of foreclosures quickly and cheaply. They urged these handpicked firms to bring all foreclosure-related services—inspections, eviction notices, sales of repossessed properties, and so forth—in-house. Thus emerged the foreclosure supermarket.

In a recent speech, Stern noted the administration’s homeowner-relief program. “Fortunately, it is failing,” he told prospective investors.

Stern’s company is one of dozens of mills that now churn through more than a million cases a year for Fannie and Freddie, big banks, and private lenders. Built like industrial assembly lines, the mills employ small armies of paralegals and other low-level employees who mass-produce court filings, run title searches, and schedule scores of hearings and property auctions daily. Staff attorneys appear for dozens of court hearings in rapid succession, dashing from one courtroom to the next with rolling file cabinets. Stern and his ilk typically create in-house subsidiaries that bill the parent law firm for the various paper-pushing tasks. “All sorts of crap is loaded on,” notes Irv Ackelsberg, a Philadelphia consumer-law attorney.

The business model is simple: to tear through cases as quickly as possible. (Stern’s company handled 70,382 foreclosures in 2009 alone.) This breakneck pace stems from how the mills get paid. Rather than billing hourly, they receive a predetermined flat fee for the foreclosure—typically around $1,000—plus add-ons for all the side services. The more they foreclose, the more they make. As a result, say consumer attorneys and legal experts, even families who have been foreclosed upon illegally—and can afford to make good on their mortgages—end up getting steamrolled. “It’s ‘How fast can I turn this file?'” says Ira Rheingold, executive director of the National Association of Consumer Advocates in Washington, DC. “For these guys, the law is irrelevant, the process is irrelevant, the substance is irrelevant.”

In 2006, for instance, a federal bankruptcy judge blasted New Jersey law firm Shapiro & Diazfor filing 250 home-seizure motions presigned by an employee who had left the firm more than a year earlier. Calling it “the blithe implementation of a renegade practice,” the judge slapped Shapiro & Diaz with $125,000 in fines. The following year, a federal judge in Texas fined foreclosure giant Barrett Burke Wilson Castle Daffin & Frappier $65,000 for filing computer-generated documents the judge called “grossly erroneous” and “gibberish.” Likewise, Wells Fargo was fined $95,000 thanks to shoddy paperwork by Florida Default Law Group—a Wellscontractor that clearly believed, according to the judge, that “filing any old pleading without undertaking any investigation into its accuracy is perfectly acceptable practice.” (In April, the state attorney general’s office began probing Florida Default for allegedly “fabricating and/or presenting false and misleading documents in foreclosure cases.”)

TERMS OF FORECLOSURE

Lender Financial institutions that sell us loans often turn around and resell the debt to the likes of Fannie and Freddie.

Fannie Mae and Freddie Mac By buying up billions of dollars in mortgage debt, these federally sponsored nurture the marketplace where loans are traded.

Securitize Bundling loans into bonds drives demand and encourages lending. But more loans mean more foreclosures—especially when things go bad.

Foreclosure mill Deluged by defaults, Fannie and Freddie hire law firms that mass-process foreclosures—quick and dirty—giving homeowners little time to respond.

Assigment of mortgage Falsification of this crucial legal document, which certifies who owns a property, is at the core of a Florida probe into the foreclosure mills’ bad behavior.

Mortgage servicer These firms, hired by banks to collect your monthly payments, might agree to cut you a break. Of course, they might not tell the foreclosure mill about it.

In their rush to foreclose, lenders and their hired guns rarely bother exploring alternatives to dumping people on the street—options likeloan modifications or federal homeowner assistance. In a 2009 survey of consumer advocates in 23 states, nearly all of the respondents said they’d gone to battle against lenders and attorneys who had ordered up forecloses without checking to see if the homeowner qualified for government help with a “workout” agreement.

In a workout, also called a loan modification, the homeowner renegotiates loan details with the servicer—the firm that collects monthly payments on a lender’s behalf. When it works, everybody wins: Families stay put, banks and bondholders maintain their cash flow, and neighborhoods escape the collateral damage of yet another blighted property. That’s why the Obama administration is pushing this strategy.

But even when the lender or service agrees to cut the homeowner a break, foreclosure mills often forge ahead, shoving cases through the courts before the workout deals are sealed. In essence, one hand ignores what the other is doing. As Alys Cohen, a staff attorney with the National Consumer Law Center, told members of Congress in April, struggling homeowners receive “confusing, seemingly contradictory correspondence” from the various entities.

The mills certainly have little incentive to cooperate with efforts to keep people in their homes. Indeed, says foreclosure-defense attorney Golant, once these high-volume shops run through all the subprime detritus, some of them may find themselves with little to do. “They have an interest in this going on as long as possible,” she says.

“It’s completely screwed up,” laments Rheingold. “The machine can’t be stopped, because the people who are making money operating the machine don’t want it to stop.”

Even Stern admits as much. In a March speech to prospective investors, he made note of the administration’s embattled homeowner-relief program. “Fortunately, it is failing,” he said.

DAVID STERN WAS WELL POSITIONED to cash in on the business opportunity offered by Fannie Mae and Freddie Mac. After graduating from law school in the mid-’80s, he took a job with the firm of Gerald M. Shapiro, one of the first lawyers to automate the foreclosure process. (Shapiro is now a partner in Shapiro & Diaz, the firm fined for its “renegade practice.”) In 1993, having mastered the ins and outs of foreclosures, Stern left to open his own shop in a North Miami Beach office with, as he related in a deposition, “ugly blue carpet and pink walls.” He shared the space, according to state business records, with his wife’s short-lived beauty consulting company, Your Personal Best.

Stern put in his applications, and by 1997, when Fannie and Freddie rolled out their most-favored-attorney program in Florida, he was on the list. He relocated the firm to the nearby city of Plantation—taking over a strip-mall space formely occupied by a Stein Mart discount clothing store. He then hired a slew of rookie attorneys whose job was primarily to rubber-stamp legal documents. One attorney whom Stern brought on in 2007, fresh from law school, told me she was ordered to sign legal filings that superiors had dumped on her desk before she had a chance to read them. She eventually quit. “Ethics are thrown out the door,” she said. Another lawyer, who deals with the firm regularly, told me that Stern’s seasoned employees belittled the newbies, referring to them simply as “bar licenses.”

Reducing the foreclosure process to data entry wasn’t an entirely novel idea, but Stern set out to perfect the model. His minions created a master database dubbed “the Bible,” with information on anything that could possibly relate to a foreclosure case in Florida—the things specific judges required, how many file copies they wanted, clerks’ phone numbers, names of judicial assistants, even warnings about when a certain judge was cranky and having a bad day. According to one former paralegal, supervisors said they would be fired if they didn’t complete at least 15 daily “casesums”—information summaries for new cases referred to the firm. Another paralegal, who spent three years at Stern’s firm, said there were unofficial contests to see who could jam a case through the fastest. “Somebody would get a 76-day foreclosure,” she said, “and then someone else would say, ‘Oh, I can beat that!'” (An uncontested foreclosure in Florida typically lasts 135 days, according to industry analyst RealtyTrac.)

While rushing foreclosures isn’t illegal, Stern’s fledgling firm was promptly accused of something that is: gouging people who are trying to get out of default. In October 1998, Tallahassee attorney Claude Walker filed a class-action lawsuit involving tens of thousands of claimants, alleging that Stern had piled excessive fees on families fighting to keep their homes. (Walker, who visited Stern’s offices in 1999 to collect depositions, described the place as “a big warehouse” where hordes of attorneys holed up in tiny, crowded offices “like hamsters in a cage.”) After several years of battling in court, Stern settled for $2.2 million. Based on that case, the Florida Supreme Court and state bar association later reprimanded him for “professional misconduct.”

A few months after Walker filed his class action, former paralegal Bridgette Balboni sued Stern personally for sexual harassment. The case details read like something out of Animal House: Balboni said Stern grabbed female employees from behind and faked sex with them, stuck his tongue in one woman’s ear, and joked that another woman used her pager as a vibrator. Balboni, who settled for an undisclosed sum, declined to discuss the case, but five other women who have worked for Stern told me of similar behavior by the boss. Several used the word “pig.”

Beyond the backdated assignments, employees told me that the firm routinely doctored its legal filings.

Legal setbacks aside, Stern remained on a roll. Two years running, in 1998 and 1999, Fannie Mae named him “Attorney of the Year.” (A Fannie spokeswoman did not respond to requests for comment.) After the Walker case settled, Stern and other foreclosure attorneys hired lobbyists as part of a campaign to convince Florida lawmakers to cap class-action damages in consumer lawsuits. The Republican-controlled legislature obliged in May 2001. Tew, Stern’s attorney, shares a legal practice with former Florida Republican Party chairman Alberto Cardenas—a prominent DC lobbyist and GOP fundraiser. Cardenas has also served on the board of Fannie Mae and lobbied on its behalf.

Stern continued cramming more employees, documents, and computers into his strip-mall headquarters. From 2005 through 2007, city inspectors repeatedly cited the firm for code violations such as blocking exits and fire sprinklers with storage, and for creating a hazard by stringing extension cords between departments.

The cases kept coming. From 2006 to 2008, as the number of Americans losing their homesdoubled, Stern’s case referrals nearly quintupled, and lenders sent him 12 times as many repossessed properties to sell off. Revenues just for Stern’s non-legal operations—titles, home sales, and default processing—leaped from $40 million to $200 million, and his payroll swelled from 400 to nearly 1,000 employees. (Orientations for new hires were a near-weekly affair, said a former secretary.) In 2008, flush with cash, the firm left its strip-mall digs for a luxurious building down the street overlooking a small lake.

“I don’t have any confidence that any of the documents the court is receiving on these mass foreclosures are valid,” said the judge.

Amid this meteoric rise, interviews and court records show, Stern’s operation began to cut corners. Beyond the backdated assignments, employees told me that the firm routinely doctored legal filings. Case chronologies—the timeline of important events in a foreclosure—were changed “all day long” to create the appearance of propriety, notes a former Stern paralegal. Internal documents show that the firm attempted to push cases through the courts even when key documents like the assignment of mortgage—or the mortgage contract itself—were missing from the file. “Need to re-set. No original loan docs,” a Stern attorney wrote in a July 2008 memo after being rebuffed at a Tampa court hearing. At a Stern hearing in April, Pinellas County Judge Anthony Rondolino got so fed up with bad behavior by the mills, he declared, “I don’t have any confidence that any of the documents the court is receiving on these mass foreclosures are valid.”

That same month, a Fort Lauderdale attorney filed a class-action lawsuit against Stern and his firm, accusing them of racketeering and claiming the firm deliberately hid the true ownership on mortgages in cases involving “tens of thousands” of homeowners. A second suit, filed just days later, claimed that Stern’s firm had refused to hold up a foreclosure on a couple in Port St. Lucie, even after it was clear that they hadn’t had so much as been late with a payment.

Despite Stern’s track record, banks and lenders continued to funnel him more than 5,000 new cases a month—and Fannie and Freddie kept him as a designated counsel until mid-October. This past summer, a Freddie Mac spokesman had cited Stern’s “good standing” in Florida, adding, “We certainly want all of our vendors to follow federal and state law.” (Neither Wells Fargo nor Bank of America—which work with Stern while publicly cheering Obama’s housing-relief programs and rolling out their own—would comment directly on their relationships with Stern. In an email, a Wells spokeswoman noted that the bank monitors all of its attorneys and adjusts its referrals accordingly.)

The problems at Stern’s firm weren’t confined to the courthouse. Supervisors would instruct their staffs to ignore or hang up on homeowners who called in with complaints—no matter how justified—according to several people who worked there in the past five years. “You would get calls from people saying, ‘We are going to be evicted today, and I just got out of the hospital. I just had a baby,'” a secretary told me. “I’d go into my boss’ office, and she’d say, ‘That’s their problem.'”

A former employee from Stern’s reinstatement unit—which is supposed to help borrowers get out of default—also spoke of a culture of indifference. “I’ve had people call and tell me the locks were changed because their house had been sold at auction” without them knowing, she said. “But you would get in trouble if you were on the phone for a long time with the borrower.”

Consider the case of Holly and Rory Hewitt, who for years faithfully made monthly payments on their modest one-story house on what was once an orange grove in Loxahatchee, Florida. In October 2007 their lender, Countrywide, erroneously informed the couple that they were in default. The Hewitts, who had the money, immediately called and asked how much they owed so that they might get things straightened out. Soon after, a reinstatement letter arrived on the letterhead of Countrywide’s legal counsel—the Law Offices of David J. Stern.

The $18,500 bill was larded with charges—property inspection, title, and late fees that seemed exorbitant even in an industry renowned for arbitrary fees, plus monthly loan payments that weren’t yet due. In addition, Stern charged the Hewitts for serving legal papers not just on Rory and Holly, but on a nonexistent spouse for each. In all, the couple was being gouged for thousands of dollars. The Hewitts took their story to a local legal aid organization, which passed the case to a private attorney. It would eventually become the core of another class-action suit—one of two pending cases alleging that Stern had dumped junk fees on some 3,500 homeowners who were trying to escape default.

Stern’s attorney insists publicly that the fees were reasonable and legal. But the lawsuits claim that Stern’s firm often tripled the standard title fee, charged for serving papers on fictitious people, and demanded payments and fees that homeowners plainly didn’t owe—violating Florida laws against predatory debt collecting and deceptive trade practices. Stern, the filings allege, is personally to blame. “These people are scratching coffee cans to get enough money to reinstate their mortgage,” says attorney Claude Walker, who is not involved in the current cases. “You don’t have to go take nickels and dimes from people who are trying to save their houses.”

A NICKEL HERE, A DIME THERE, and pretty soon you’re talking real money. Stern’s back-office operations cleared more than $44 million in profit last year. Last December, a Chinese acquisition fund purchased those departments and spun them off into a company called DJSP (David J. Stern Processing) Enterprises. Incorporated in the British Virgin Islands—a notorious tax haven—the new firm processes Stern foreclosures and handles other firms’ foreclosure paperwork, too.

Stern and his operations collected more than $100 million in the deal, and he retained a top role in DJSP. In January, the company’s stock debuted on the NASDAQ at $9.25 per share—and with that, the small outfit he had launched in 1994 in an ugly North Miami Beach office was worth in the neighborhood of $300 million.

The company’s stock took a hit in May, after Stern warned investors of lower earnings due in part to a slowdown in referrals by a big client, and also to the Treasury Department’s renewed homeowner-relief efforts. Share prices tanked further after angry investors, claiming Stern knowingly misled them, hit him and DJSP with a securities-fraud class action. (This fall, under fire in the wake of our investigation and subsequent revelations, Stern stepped down as DJSP’s chairman.)

Stern had gone out of his way to assure investors that foreclosures would surge in the second half of 2010 as clients processed their backlogs of delinquent loans. This past spring, he and his chief financial officer flew to Southern California to make the case for why the foreclosure industry is ripe for expansion. The setting was the annual shindig of investment banking firm Roth Capital Partners, a swank conference for hedge-fund managers and institutional investors held at the Ritz-Carlton, Laguna Niguel—a luxury hotel perched on a bluff overlooking the Pacific Ocean. Conference perks included private concerts by Social Distortion and Billy Idol.

In his speech to the money people, Stern explained why the time was right to invest. Historical data, he said, showed that people will continue losing their homes in large numbers through 2012, ensuring plenty of business. “When people say, ‘Oh, my god, the economy is bad,’ I’m like, ‘Oh, my god, it’s great.'” he told his audience. “I hate to hear people are losing homes, and credit isn’t available, and people’s credit is such that they can’t [refinance]. But if you are in our niche, it’s what we want to do, and it’s what we want to see.”

 

Foreclosuregate: Sue The SCUMBAG Judges Who Allow Fake Foreclosures

By bgamall

 

In the Light of Foreclosuregate There Are Thousands of Bad Judges

In the light of Foreclosuregate, not so named by CNBC and the bankster crowd, there are many bad judges. In fact, the definition of a bad judge isone who fails to protect the unrepresented. Many people are being foreclosed on. And they are not being represented, as the alleged holder of the mortgage and IOU actually gets the judge to look the other way, as it is found that the servicer of the mortgage does not have the IOU. Foreclosures have been allowed by crooked judges in cases where the IOU has been lost! And why were they lost? Well, it was because of the need for companies to hide the crap loans put together in the MBS bankster scam.

So, the problem is that you have very unethical judges who are rubber stamping a foreclosure without the IOU being in anyone’s possession. There are two issues that make this a serious offense:

1. The courthouse does not have the IOU. The courthouse has a copy of the deed, but not the IOU. But the IOU is required in order to determine the terms of the loan, and the owner of the mortgage.In many cases, the IOU has been lost, and in many cases was hidden or lost on purpose in order to fool investors into buying mortgage backed securities, you know, the crap bonds that were rated AAA but that really had junk attached!

2. Since the IOU has to be registered with the trustee of the MBS at the investment bank within a certain period, Title is clouded and broken when the investment bankster wants to hide this bad loan from potential investors. As it turns out, the investment banksters never bothered to convey the documents to the trustee of the Mortgage Backed Securities in the first place. This is both mortgage and securities fraud and it breaks the Title. In reality, these trustees don’t own these mortgages because the IOU’s cannot be reconstituted.

Table of Contents

  • In the Light of Foreclosuregate There Are Thousands of Bad Judges
  • It Is Difficult to Sue Judges Without First Exposing Them
  • So How Does the UCC Code Affect Foreclosures
  • Foreclosuregate In the News
  • Foreclosuregate Information
  • Facing Foreclosure Issues? Here Are Foreclosure Resources

 

It Is Difficult to Sue Judges Without First Exposing Them

The first part of the process is to expose judges. If there is a judge that allows a phony IOU, list that judge with Caught.net or here.

Judges who are doing fraudulent things at the state level, like foreclosures, can be sued in Federal Court. It is difficult to sue a judge. And yet, perhaps a class action against judges would at least publicize their behavior so that they would be more reluctant to go along with the bankster claims of title.

However, it is possible to appeal. And people with the means who want to make the court own up to injustice can do so.

We know that Florida has a bunch of Kangaroo courts, rubber stamping foreclosures that have no clear title. Naked Capitalism Blog has been at the forefront of this exposure of judicial misconduct.

In order to buy some time for the borrower, it is time to clog the courts with paper. I advocate clogging the courts with all manner of lawsuits and motions. People need to stay in their houses as long as they can, because they have been scammed in the first place. Yes, the scam is primarily an injustice against investors, but no one can doubt that borrowers have been scammed by this process as well. Just learning about Foreclosuregate will make it clear that borrowers have been victims of a process that would have been stopped dead in its tracks had investors had access to the IOU’s showing how bad the loans were that went into the MBS’s. Investors would have stopped buying these fraudulent bonds long ago.

As it is, since these securities, the MBS’s, are fraudulent, I hope investors seek major damages from the investment banksters. That will be a start. We need to discuss whether securitization for mortgages is something that should even be permitted.

 

Squat In Your Own Home. Don’t Pay. Show Me the Note!

So How Does the UCC Code Affect Foreclosures.

First a disclaimer, this is not legal advice. This webpage does not in any way tell you how to proceed but rather gives some possible suggestions that you may be able to explore with your attorney.

So, as it turns out, the UCC Code generally requires that the proof of transfer from the lender to the investment bank can be proven. The IOU can be reconstructed if this link can be proven. There may be other laws which say title is broken, and in those cases, Title Insurance Companies may choose to hold off. But UCC requires a connection regarding transfer. This is where the banksters made a major fraud. The investment bankers who took these mortgages from the lenders never conveyed the documents. Since there was no proof of transfer, the bonds or I should say the trust for the bonds do not own the mortgages. This is major mortgage and securities fraud. This is where the court has to be careful that there are not a lot of phony documents. Congress should pass a law with serious penalties for those caught forging documents, getting fake notaries, etc. But congress was intent on doing just the opposite, as Diana Olick exposed regarding the robo signatures.

The courts that refuse to require proof of this transfer link must be exposed and their judges held up to severe ridicule. Lets hope that happens in the coming months.

Judge Ignorant of UCC Rules Against Borrower

Foreclosuregate In the News

  • Cuccinelli to join foreclosure probeRichmond Times-Dispatch6 days agoThe possible mishandling of mortgage documents has hit home. Attorney General Ken Cuccinelli said yesterday that he, along with attorneys general in the other 49 states, will look into allegations of abuse in the foreclosure process.
  • Lawmakers Increasing Heat on Servicers on the Foreclosure Front While Regulators Try to Give a PassNaked Capitalism28 hours agoAt least some legislators are taking the foreclosure crisis seriously. Representative John Conyers, Marcy Kaptur, Raúl Grijalva, and Alan Grayson wrote to Neil Barofsky, Special Inspector General for the Troubled Asset Relief Program, to ask that he investigate foreclosure fraud and conduct an audit of GMAC, Fannie, and Freddie. SIGTARP is a full fledged […]
  • Foreclosure mess just startingThe Bryan-College Station Eagle22 hours agoWASHINGTON — Big lenders are trying to move past the foreclosure-document mess, saying they’re now confident their paperwork is accurate. Yet they face so much organized resistance that they can’t just snap up their briefcases, declare the crisis …
  • Johnstown man sues GMAC Mortgage, alleges fraud in foreclosure processNewark Advocate4 days agoNEWARK — The inevitable legal response to allegations of fraud on foreclosure documents reached Licking County on Friday with a Johnstown man’s lawsuit against GMAC Mortgage and one of its employees.
  • Avoiding the ‘f’ wordDaily Sparks Tribune25 hours agoRENO — To a homeowner who is facing foreclosure, all hope might seem lost, but housing counselors are available to help.


Foreclosuregate Information

Facing Foreclosure Issues? Here Are Foreclosure Resources

Jennifer Brunner Fights The Banksters

Attorney Resources: Save the Constitution

Bad Judge List

Here are judges who have decided not to watch out for the underrepresented. Phone them and tell them to follow the law. Tell them to throw the bogus affidavits out of their courthouses! This is about due process and the validity of evidence you bad judge shills for big banksters.

W. Douglas Baird (727) 464-3233

Jack Cox (561) 355-3496

J. Rogers Padgett

Bad Attorney List:

Attorneys listed here may have violated evidence requirements and due process in courts of law. Innocent until proven guilty, but we hope they will be criminally investigated.

Steven Baum New York

David Stern Florida

 

A Good Ruling By Good Judges (At Least In This Ruling)

Arkansas Supreme Court Ruling, yet bad judges have ignored this for over a year:

MORTGAGE ELECTRONIC REGISTRATION SYSTEM, INC., APPELLANT, VS. SOUTHWEST HOMES OF ARKANSAS, APPELLEE

No. 08-1299

SUPREME COURT OF ARKANSAS

2009 Ark. LEXIS 121

March 19, 2009, Opinion Delivered

Further, under Arkansas foreclosure law, a deed of trust is defined as “a deed conveying real property in trust to secure the performance of an obligation of the grantor or any other person named in the deed to a beneficiary and conferring upon the trustee a power of sale for breach of an obligation of the grantor contained in the deed of trust.” Ark. Code Ann. § 18-50-101(2) (Repl. 2003). Thus, under the statutes, and under the common law noted above, a deed of trust grants to the trustee the powers MERS purports to hold. Those powers were held by East as trustee. Those powers were not conveyed to MERS.

MERS holds no authority to act as an agent and holds no property interest in the mortgaged land. It is not a necessary party. In [*11] this dispute over foreclosure on the subject real property under the mortgage and the deed of trust, complete relief may be granted whether or not MERS is a party. MERS has no interest to protect. It simply was not a necessary party. See Ark. R. Civ. P. 19(a). MERS’s role in this transaction casts no light on the contractual issues on appeal in this case. See, e.g., Wilmans v. Sears, Roebuck & Co., 355 Ark. 668, 144 S.W.3d 245 (2004).

Finally, we note that Arkansas is a recording state. Notice of transactions in real property is provided by recording. See Ark. Code Ann. § 14-15-404 (Supp. 2007). Southwest is entitled to rely upon what is filed of record. In the present case, MERS was at best the agent of the lender. The only recorded document provides notice that Pulaski Mortgage is the lender and, therefore, MERS’s principal. MERS asserts Pulaski Mortgage is not its principal. Yet no other lender recorded its interest as an assignee of Pulaski Mortgage. Permitting an agent such as MERS purports to be to step in and act without a recorded lender directing its action would wreak havoc on notice in this state.

Affirmed.