Bostonian of the Year: Elizabeth Warren, Watchdog

Editor’s Note: Thanks to Allan again. If there is one person in a relatively high position who has understood the subprime crisis, acquired the information on securitization, named the villains and described their practices separating honest people from their money it is Elizabeth Warren, whose was barely heard over the din of back-slapping during the roaring mortgage meltdown. She understood the basics and the the long-term consequences but she was largely ignored because her message did not put a “happy face” on the ending.

As Chairman of the Congressional Oversight Committee for the TARP funds, she has steadfastly sought answers to questions that need to be answered before we can even think or consider ourselves past this crisis. She can’t get those answers. She needs your help. Write to your congressman and senators (yes, it DOES work when enough people do it) and tell them to support Elizabeth Warren’s efforts to give answers to the most basic of questions: where did the TARP money go? Did TARP cover losses on “troubled assets” or bets that the troubled assets would tank? Where is the rest of the money from the mortgage meltdown period? Were the losses proclaimed by the Bush Treasury Ex-Goldman CEO real (or was this another “weapon of mass destruction”)? Ms. warren wants answers so she can give Congress and the American people information they need, even if they don’t want to hear it.

All evidence points to some obvious conclusions. The TARP money was the cherry on top of a giant cake that Wall Street baked and ate. There were no losses because they had not advanced the money for the mortgage loans. And they rigged the system so that the hedge bets they made through credit default swaps went into their own pockets, instead of the investors who put up the money (i.e., the ones who parted with real cash). Their premise was simple —- why take the risk of trying to make good loans perform well when you can make a whole lot more money making bad loans, making sure they go into default and placing bets that the loans will fail? The proof of the pudding is in the results. Goldman now takes the position that they could have survived the credit squeeze without the TARP money because now it suits them to say it. One year ago they were screaming “fire!”

Now they are also taking advantage of a rigged system wherein the proceeds of foreclosure sales also go to the intermediary players and not to investors and they won’t let the homeowner bid on his own property when they have rigged the sale to go to a friend at a triple distressed discount, at a price set moments before the bidding commences.

2 years ago I said that the Wall Street Banks were going to declare fictitious losses to cover ill-gotten gains leaving the investors and homeowners as the stooges in their virtual money game of synthetic derivatives and related instruments. The stock market would crash for many reasons, the housing market would dissolve into quicksand, and in the end, the Wall Street Banks would start declaring a portion of the trillions of dollars they made —seemingly out of nowhere. Despite the decrease in the movement of money from which Wall Street earns its “fees”, they would declare higher profits.

Each year they will declare a little more and bring it back on shore unless there is more money in keeping it off shore. Each year their stock will appear to rise in value because of profits they made years before but hid from everyone with “off-balance sheet” (read that as unreported, because they were allowed to do it) transactions that will gradually be reunited with the main company when and if it suits them to do so. When they want their stock to go up, they will release good earnings news — made possible by absurd changes in the rules of generally accepted accounting principles.

Most of the business world and therefore the people in government who are run by the business world don’t want to think about these things and refuse to speak about them out loud (Marcy Kaptur D-Ohio, a notable exception). The facts point to a single conclusion that leaves a crater in our American idealism: an act of domestic and international terrorism was spawned and directed from Wall Street killing the futures, the lives and the hopes of millions of people. These were people on pensions, where their pension fund manager invested in these crazy exotic toxic securities. And they were people with homes that were paid for, or new home buyers who invested their life savings and their home into a scheme they knew nothing about. The losers are the investors and the homeowners. Restore them and you restore confidence. Restore them and the ability of the economy to recover is enhanced.

The correction is simple: take it back from Wall Street and give back the losses to those who were defrauded. As long as millions of people are living in homes they will never be able to pay for (because of inflated appraisals that were false on the day of closing) we can never recover. So one of two things needs to happen: either the principal and payments are reduced, or the people simply walk from their homes and rent the house next door for a fraction of their former payments.  Either way, the fair market value of the homes can never be pumped up to the false levels of 2001-2008. The difference is whether the inside club will be allowed to trade in these houses for pennies on the dollar because they have no money in the deal or if the courts (and the media) start demanding the truth, case by case. They will discover that the real creditor, the investor is not making a claim for collection on the obligation, the note or foreclosure of the mortgage. Why? And if the the investor is the real creditor, then who are these people who are pushing through millions of foreclosure sales?


The Watchdog: Elizabeth Warren

It seemed as if the banks and other firms got a $700 billion bonanza and the American taxpayer got the shaft. But along came this straight-shooting Harvard professor to oversee the bailout, someone who pledged to look out for the middle class and brought a sense of sanity to the economic crisis. For this we give her our top honors this year.

By Charles P. Pierce | December 20, 2009 A.D.

There are many ways to become our Bostonian of the Year. You could be one of the nation’s preeminent bankruptcy scholars, and a tenured professor of law at Harvard University, and a talking head for Frontline specials and Michael Moore’s latest documentary, and a leading voice decrying the human cost of the current economic morass, and the chairwoman of the Congressional Oversight Panel monitoring the Troubled Assets Relief Program, the TARP that covers a multitude of financial sins. The panel keeps an eye on how the nation’s banks have spent the taxpayer money shoveled into them in the fall of 2008, as well as the destination of the rest of the $700 billion allocated by the government when the economy seemed on the verge of swallowing itself whole. This can set you at odds with secretaries of the Treasury, various ambitious legislators, and laissez-faire economic fundamentalists. Elizabeth Warren has done all that, and has done as much to earn the title Bostonian of the Year as has anyone who was born and raised in Oklahoma. But she has one even more essentially Bostonian accomplishment on her considerable resume — she once shut up basketball fans in Philadelphia.

One night about two decades ago, she and her husband, Bruce Mann, who also teaches at Harvard Law, were attending a game between the 76ers and Warren’s beloved Houston Rockets. (Warren taught at the University of Houston when Hakeem Olajuwon played for a Cougars team memorably dubbed “Phi Slama Jama” for its dunking prowess.) “So Elizabeth is up, cheering, yelling at the ref,” Mann recalls. “And the crowd around is getting kind of, well, restive. They’re saying, ‘Hey, lady, you’re not from around here, are you?’ ” Finally, one of the burlier gentlemen in Warren’s section inquired why she was so passionate about the Rockets. Warren explained her background in Houston. He then determined to quiz her on her bona fides.

Who was the coach of that team, he asked her.

Guy V. Lewis, she answered.

What was his trademark, he asked her.

He carried around a checkered towel, she answered.

(Warren was being kind here. Lewis’s most conspicuous trademark was his staggering incompetence in big games.)

Satisfied, the man sat down and Warren went back to being loud. Gradually, the crowd began to get audibly impatient with her again. Suddenly, the large gentleman stood up and addressed his colleagues.

“Leave the lady alone,” he told them. “She’s got history.”

You can understand that moment when Warren, 60, talks about the political heat inherent in the position she now holds. The great cause of her life has been defending middle-class Americans against what she calls the “tricks and traps” the nation’s financial institutions devise to separate those citizens from their money. She was talking about the dangers of the subprime mortgage binge long before the bubble finally popped. She is equally scornful of how the credit card companies bury their real brigandage under a blizzard of sub-paragraphs and dependent clauses. And ever since last November, when Senate majority leader Harry Reid persuaded her to take charge of the Congressional Oversight Panel, and even though she is aware that the panel does not have any real enforcement powers, Warren has become a burr under the saddle of official Washington — plain-spoken, invariably polite, intolerant of business-school persiflage (“That’s a word we don’t use enough!” she exclaims), and utterly contemptuous of conventional wisdom. These are not qualities that endear you to the courtier set inside the Beltway. Warren got in the face of then Treasury secretary Henry Paulson and stayed there to the point where Paulson’s staff began sniping at her in the newspapers. She gently — but relentlessly — prodded Paulson’s successor, Timothy Geithner, until Geithner dragged himself before the panel to testify.

“We are an experiment here,” she says. “The secretary of the Treasury raced in and said the economy’s on fire. Congress was in the position of having to react rapidly and without much specificity. At the same time, they didn’t want to write a blank check to Treasury, so they hooked oversight to it. The secretary of the Treasury has enormous discretion, but there will be a group appointed to keep evaluating what Treasury is doing, and that group will be required to put out a report every 30 days. We’re supposed to keep planting flags in the ground. You have to prove what you said. I don’t want happy-face conclusions. I want the truth.”

They also are not qualities guaranteed to make you friends among the Masters of the Universe in the financial services industry or among the legislators whom they may have sublet. Her advocacy of a financial product safety commission, a federal watchdog agency to regulate predatory lending, drew howls from small-government conservatives. “That agency is the game-changer,” she argues. “This is the chance to level the playing field between middle-class families and huge financial institutions by making those products work again, by making them as simple as toasters.”

In short, she has been accused of exceeding her mandate, mostly by people who would rather she not have a mandate at all. She has been called an ideologue — mostly, it should be said, by other ideologues. Warren, simply, could not care less. “They were tired of me before I started,” Warren says with a laugh. “I am not looking for jobs with these guys. My job is not to get out there and kowtow to these guys so they’ll be nice to me. I figure this is the one time I will have a true public-service job. I’m going to do everything I can to execute this job the way it ought to be done. If there’s some politician, Republican or Democrat, who has a problem with that, I just don’t care.

“I have no future in this, and I have lifetime tenure [at the Harvard Law School]. What are you going to do to me?”

Perhaps the most dissonant criticism leveled against Warren is that she simply is another Harvard elitist come down from the mount to lecture the rest of us on the way the country should be run. On the wall of her office, framed, is a Pennsylvania newspaper advertisement from August 23, 1882, announcing that Sheriff Joseph Frankenfield would be auctioning off a farm that day, a property owned by folks on whom the bank had foreclosed a mortgage. Gradually, almost imperceptibly, a gentle twang enters Warren’s voice when she talks about this ad. “If you don’t talk about families,” she says, “then it’s easy to disembody subprime mortgages and asset securitization and unemployment rates without remembering that every one of those numbers is a million families.” This is what the guy meant in the basketball arena some 20 years back. The lady has history.

In Norman, Oklahoma, it was the last house on the last road on the far edge of town. Behind it were wheat fields that extended to Texas, or to the Pacific, or to Oz, as best as you could tell from standing in the yard. Elizabeth Warren grew up there, a caboose of a child with three much older brothers. “One was huge and the other two were mean,” she recalls. “I was 30 before I realized, you know, that I probably was an accident. These things just suddenly hit you one day.” Eventually, her father wound up as a maintenance man in an apartment building and her mother did catalog sales for Sears.

Warren was something of a local prodigy, a state champion debater who graduated from high school at 16. One day, having saved up her baby-sitting money, she went to the local convenience store and took out money orders totaling $50 to apply to two colleges — George Washington University and Northwestern — to which she thought she was most likely to get a debate scholarship. She enrolled in the former but left after two years, when, at 19, she married Jim Warren, an engineer with NASA whom she’d been dating since she was 13. He was in Houston, working on the Apollo program, and Elizabeth transferred to the University of Houston to finish her degree. Eventually Jim’s work took them to New Jersey, where he was working on the country’s antiballistic missile program. Spurred by some of the people who had been on the debating team with her, Elizabeth enrolled in law school at Rutgers University. In 1976, she had a JD and new baby and few prospects.

“I graduated law school nine months pregnant and didn’t take a job,” she says. “This was 1976, and I’m thinking that I stepped off the track. So I’m at home, and I thought, ‘I’ll just take the bar exam. What’s the worst that can happen?’ So I took the bar exam and thought, ‘Well, shoot, I’ll just hang out a shingle.’ ” (In this, Warren is being quite literal. The shingle now hangs in her Harvard office, beneath the foreclosure notice from 1882.) She did real estate closings and lawsuits arising from automobile accidents. (Her talent for drawing up a will has yet to be fully tested, because, as far as she knows, nobody for whom she drew up a will has died.) In time, Rutgers asked her to teach a class part time, and Warren found herself a calling. By then, her husband’s job had vanished because the United States had bargained away the ABM system by treaty with the Soviet Union. They moved back to Houston and divorced in 1978. (She met Mann a year later.)

She taught in the law school at the University of Houston and, subsequently, at the universities of Texas and Pennsylvania before landing at Harvard in 1995. But Warren stumbled upon her specialty at her first full-time teaching job in Houston. In 1979, a new code of bankruptcy law went into effect, and Warren shared its details with the students in her first bankruptcy class the next year. Her interest was piqued. “I taught it like a Final Jeopardy question,” she recalls. “If this is the answer, what must have been the problem that people thought this fixed?” She teamed up with another law professor and a sociologist, and the three of them went into the field to study what was happening in the nation’s bankruptcy courts.

“I get this clever idea,” she says. “I’m going to expose these sleazy debtors who are exploiting the bankruptcy system and their poor, hapless creditors and enriching themselves as far as the law allows by going through bankruptcy court. I go out with these other two folks and we start collecting data about the families who are filing for bankruptcy. We end up doing this big study, and it ends up as a book [AS WE FORGIVE OUR DEBTORS]. And it completely turns me around. I knew what I was going to find before I went out there, and I discovered that it doesn’t work that way.”

Warren continued her study of the effect of the macroeconomic financial system on American families. Another book, THE FRAGILE MIDDLE CLASS, examined why most families in bankruptcy would be considered to be middle class by any conventional social indicator, and reported that most of them ended up in dire financial straits due to medical problems, job loss, or the breakup of the family. This led to THE TWO-INCOME TRAP, which she coauthored with her daughter, Amelia. (She also has a son, Alexander.) “It really was about what happened to the middle class over a generation,” she explains. “From the 1970s to the early 2000s, there was a hollowing out of the middle class.”

Over the past two years, in its near-collapse, the financial services industry began to smack not a little of the rigged wheel, and its impact on the lives of American families — particularly as seen through the prism of the subprime mortgage fiasco — appeared to be dire. The issues on which Warren made her career exploded into the national consciousness. She became a sought-after expert, debuting as a pundit — a word that makes her roll her eyes and moan — on the Dr. Phil show. And she minced no words.

“More and more middle-class families realized that what they were experiencing was not unique to themselves, that there were larger social trends,” she says. “And I also think there comes a point where people get tired of hearing the same old stuff from the kind of media machine the financial services industry has been pumping out.

“The thing about the Masters of the Universe syndrome is that it plays on ‘What I’m doing is so obscure that you’ll never get it. You’re too dumb.’ This really became relevant when we hit the financial crisis a year ago.”

Then, one day, while Warren was barbecuing with students, Harry Reid called and asked her to take on the TARP oversight job. “I’ve really been talking about the same set of issues for a long time, but I was under the radar, and that was OK with me,” she says, the twang thickening just a bit, as though her voice had been aged in oak. “I don’t know, but I think part of it was that the world changed. What was a boring and obscure issue suddenly moved front and center.” And, when it did, she was there, with her history and all that, looking faceless forces squarely in the eye, speaking plainly to persiflage, and, in her own amiable way, drowning out the faint, distant voice of Sheriff Frankenfield’s auctioneer.

Charles P. Pierce is a staff writer for The Globe Magazine. E-mail him at

30 Responses

  1. Subject: Assignment Fraud… Court Precedent?
    Date: Thu, 31 Dec 2009 16:47:34 -0500

    Mr. Webster,

    I would ask as a precedent in which cases the notes were invalidated, the foreclosure process halted, and the current owner allowed to keep the property?

    Homeowners know if they owe or not, and if they pay or not.

    If a court set precedent invalidating mortgages based on a securitized assignment the mortgage and banking concept (not just industry) would collapse. Few will pay if they can keep the house for free.


    From: Tony Webster []
    Sent: Thursday, December 31, 2009 1:16 PM
    To: Scott Ellis
    Cc: Pete Griffin; Frank Sakuma;
    Subject: [SPAM] FW: Assignment Fraud… Felony?
    Importance: Low

    Mr. Ellis,

    MERS has no Agency status as a nominee (therefore cannot foreclose or assign notes/mortgages) because it has no pecuniary interest in the Note and therefore, because the Mortgage is an incident to the Note (debt) any Assignment of the mortgage without said Note is a nullity.

    There are tons of case precedents to cite. The separation of the Note and Mortgage is Black letter law older than the MERS scam.


  2. The problem in my case is the servicer forced default by not appling payments, forced place insurance, property preservations ETC> I have never been late nor missed a payment . I sent as part of discovery all Bank records and checks. The fraudsters foreclosed without proof of ownership, filed a fake assignment from original lender that is a defunct company since 2005 after lis pendens and the assignment of course skipped a to b, b to c, and went directly to D. Tell me who’s trying to get something free n clear . Here’s the twist I HAVE THE ORIGINAL NOTE SIGNED IN INK. They get what they deserve!!!!

  3. *these are the same people who want me to report fraud to them… what a joke (see links below).

  4. A (continued) healthy debate with our County Clerk of Court as to why he allows fraudulent documents to be recorded in public record.

    Subject: Assignment Fraud… but what is yours, and what is not yours?
    Date: Thu, 31 Dec 2009 16:26:05 -0500

    I truly believe if you borrow the money you know you owe it, and if there is collateral you know it is to be forfeited upon failure to make loan payments, Mr. Webster.

    Now from what I have seen of credit cards it should be criminal. People who make every payment on time have had interest rates skyrocketed without recourse. Now any time I ever got a ‘change of terms’ letter I’d reject and just pay it off, but I did have one (paid off years ago when I sold the house) which raised the rate a number of points with no options and no reason. Well, I digressed, but needless to say I have no credit cards any more.

    We do see the issues that have arisen from the securitization and assignments as it often takes 18 to 24 months of more for a foreclosure to go through. That said the Judges will never interpret the law to allow a securitization to void the note and allow the borrower to keep the property.

    If court precedent were allowed to void the foreclosure process on securitized mortgages then EVERYONE with such a mortgage would cease all payments. In essence, we’d have something I’ve warned about, the Mortgage Jubilee.

    Any such Mortgage Jubilee would financially wreck what is left of the government funded mortgages and banks as well as ensure there would be no more mortgages written again in America.

    The only reason collateralized loans are written is the lender knows in the worst case the collateral can be taken back. If you remove the ability to take back the collateral most of the mortgage holders in America would deliberately default.

    The bank bailouts have wiped out the moral hazard for the bank thieves at our expense, and now what I fear is worse, is turning our entire society on its head promoting the moral hazard of individuals.

    Thanks, Scott

    From: Tony Webster []
    Sent: Thursday, December 31, 2009 11:35 AM
    To: Scott Ellis
    Cc: Pete Griffin; Frank Sakuma;
    Subject: [SPAM] RE: Assignment Fraud… Felony?
    Importance: Low

    Mr. Ellis,

    The money came from the investors who purchased certificates in the trust. Supposedly these notes were registered in the trust (unless they were pledged, similar to the naked short sale in which delivery never occurred). This is why an evidentiary hearing is necessary.

    The loan servicer (via fraudulent assignment of mortgages) take the property out of the trust without knowledge or consent of the investor.

    I don’t make the laws, but they are on the books. People asked for a loan… not for fraud. Fraud negates these instruments. The laws state if there is fraud involved – they are not entitled to benefit.

    So who are the real parties involved? What happens when they come back to claim their property. There are a lot of people out there who simply want to know who really owns the note to avoid paying off the wrong party.

    UCC 3-501 requires a lender to “exhibit the note” when the lender makes demand for payment, and the borrower demands to see the note. Technically a demand for payment occurs every month, and it also occurs when a bank begins foreclosure proceedings.

    UCC 3-501 also requires a servicer to show authority to make a demand for payment, if it does not own the note, but is merely servicing it. In the event a noteholder or servicer or will not exhibit the note or perform other legal requirements when requested to do so by the borrower, this UCC section allows the borrower to discontinue payments WITHOUT DISHONOR until such time as the noteholder or servicer complies with all laws or contract provisions.

    Your thoughts?


    Tony Webster

    Subject: RE: Assignment Fraud… Felony?
    Date: Wed, 30 Dec 2009 21:56:56 -0500

    I’m not really sure what the point is, Mr. Webster. If you are saying a lender is foreclosing on a property where the owner is current on his payments then I clearly see a problem.

    (My response in BOLD)


    If the borrower knows he borrowed the money, is sitting in the house (or renting it out), and knows he has not made the payments, are you saying the present owner is entitled to keep the property without making payment on money he willingly borrowed?


    I have dealt with a pitiful mortgage company before who purchased my original mortgage, but while they were horrible, I knew I owed the money.


    Are you saying the note on what was borrowed and the title to the property should both be voided? If so is this simply to be able to quit claim the property to a lender of some name (as best can be determined)? The powerpoint goes over chains of title and assignment, but I never saw where anyone claims the money was not borrowed.


  5. Mario, you are making me cross-eyed!


  6. the porbelm of psotnigs not shwonig has been there from day one do not tkae this pesoranl it must be some sort of glitch, hpaepns to me soemitmes and i tinhk I may hvae been the vrey first psoter on this bolg.

  7. Hi Deontos,

    I know what you mean…sometimes a post flies right in..even with links.

    Could be the 1.6 million visits is taxing the site’s infrastructure,


  8. Dave L

    In re The Curious Case of Disappearing Posts.

    I have been having the same problem intermittently for
    weeks. I would “click” “Submit Comment”, it processes
    and then one of two things happen:

    “Awaiting Moderation” message appears and the post never
    passes out to the website itself.
    The “post” just never appears on the website after “processing”

    I am hesitant to keep re-posting the identical “Comment” as
    it then might appear multiple times on the Blog. At which time
    it looks like I am all thumbs!

    I did discover that when you post with a “hyperlink” reference some where in your text, it will often, but randomly cause this glitch. When I “dummy” the hyperlink then the “Comment” posts.

    Dummy: X_

    There is no rule to dummy the link. Any character in front of the
    “http” will do it “Yhttp” etc. I just use the “Xunderscore” so people can easily “copy out the hyperlink” and use it.

    The eternal “Awaiting Moderation” glitch I have no answer for.

  9. what happened to David Wiechel’s power point presentation, it says no longer can be found.

    I printed it out prior to the disappearance.

  10. [youtube=]


    Funds that invest in below-investment grade debt securities and
    unrated securities of similar credit quality (commonly known as
    “junk bonds” or “high yield securities”) may be subject to greater
    levels of interest rate, credit and liquidity risk than Funds that
    do not invest in such securities. These securities are considered
    predominately speculative with respect to the issuer’s continuing
    ability to make principal and interest payments. These issuers
    may be involved in bankruptcy proceedings, reorganizations, or
    financial restructurings, and are not as strong financially as higher
    rated issuers. If the issuer of a security is in default with respect to
    interest or principal payments, a Fund may lose its entire investment.
    Below investment grade securities are more susceptible to
    sudden and significant price movements because they are generally
    more sensitive to adverse developments. Many below-investment
    grade securities are subject to legal or contractual restrictions that
    limit their resale at desired prices.

    U.S. Government Securities RISK
    Obligations issued by some U.S. Government agencies, authorities,
    instrumentalities or sponsored enterprises, such as Government
    National Mortgage Association, are backed by the full faith and
    credit of the U.S. Government, while obligations issued by others,
    such as Federal National Mortgage Association, Federal Home
    Loan Mortgage Corporation and Federal Home Loan Banks, are
    not backed by the full faith and credit of the U.S. Government and
    backed solely by the entity’s own resources or by the ability of the
    entity to borrow from the U.S. Treasury. No assurances can be
    given that the U.S. Government will provide financial support to
    U.S. Government agencies, authorities, instrumentalities or sponsoredenterprises if it is not obligated to do so by law.
    See folks Bear stearns asset backed securties (Global Bond Fund ( U.S. Dollar _Hedged) Guaranteed by the US. Government this is where I traced my secrutinized 2003-2 series to. 07384YJP2 BSABS 2003-2 A2 AFC 1 MOLIB +45 Net cash Equivalents. Crooked , criminal, to the point of if you found out they truth they would have to kill ya.


    Bankers Get $4 Trillion Gift From Barney Frank: David Reilly | A A A Commentary by David Reilly

    Dec. 30 (Bloomberg) — To close out 2009, I decided to do something I bet no member of Congress has done — actually read from cover to cover one of the pieces of sweeping legislation bouncing around Capitol Hill.

    Hunkering down by the fire, I snuggled up with H.R. 4173, the financial-reform legislation passed earlier this month by the House of Representatives. The Senate has yet to pass its own reform plan. The baby of Financial Services Committee Chairman Barney Frank, the House bill is meant to address everything from too-big-to-fail banks to asleep-at-the-switch credit-ratings companies to the protection of consumers from greedy lenders.

    I quickly discovered why members of Congress rarely read legislation like this. At 1,279 pages, the “Wall Street Reform and Consumer Protection Act” is a real slog. And yes, I plowed through all those pages. (Memo to Chairman Frank: “ystem” at line 14, page 258 is missing the first “s”.)

    The reading was especially painful since this reform sausage is stuffed with more gristle than meat. At least, that is, if you are a taxpayer hoping the bailout train is coming to a halt.

    If you’re a banker, the bill is tastier. While banks opposed the legislation, they should cheer for its passage by the full Congress in the New Year: There are huge giveaways insuring the government will again rescue banks and Wall Street if the need arises.

    Nuggets Gleaned

    Here are some of the nuggets I gleaned from days spent reading Frank’s handiwork:

    — For all its heft, the bill doesn’t once mention the words “too-big-to-fail,” the main issue confronting the financial system. Admitting you have a problem, as any 12- stepper knows, is the crucial first step toward recovery.

    — Instead, it supports the biggest banks. It authorizes Federal Reserve banks to provide as much as $4 trillion in emergency funding the next time Wall Street crashes. So much for “no-more-bailouts” talk. That is more than twice what the Fed pumped into markets this time around. The size of the fund makes the bribes in the Senate’s health-care bill look minuscule.

    — Oh, hold on, the Federal Reserve and Treasury Secretary can’t authorize these funds unless “there is at least a 99 percent likelihood that all funds and interest will be paid back.” Too bad the same models used to foresee the housing meltdown probably will be used to predict this likelihood as well.

    More Bailouts

    — The bill also allows the government, in a crisis, to back financial firms’ debts. Bondholders can sleep easy — there are more bailouts to come.

    — The legislation does create a council of regulators to spot risks to the financial system and big financial firms. Unfortunately this group is made up of folks who missed the problems that led to the current crisis.

    — Don’t worry, this time regulators will have better tools. Six months after being created, the council will report to Congress on “whether setting up an electronic database” would be a help. Maybe they’ll even get to use that Internet thingy.

    — This group, among its many powers, can restrict the ability of a financial firm to trade for its own account. Perhaps this section should be entitled, “Yes, Goldman Sachs Group Inc., we’re looking at you.”

    Managing Bonuses

    — The bill also allows regulators to “prohibit any incentive-based payment arrangement.” In other words, banker bonuses are still in play. Maybe Bank of America Corp. and Citigroup Inc. shouldn’t have rushed to pay back Troubled Asset Relief Program funds.

    — The bill kills the Office of Thrift Supervision, a toothless watchdog. Well, kill may be too strong a word. That agency and its employees will be folded into the Office of the Comptroller of the Currency. Further proof that government never really disappears.

    — Since Congress isn’t cutting jobs, why not add a few more. The bill calls for more than a dozen agencies to create a position called “Director of Minority and Women Inclusion.” People in these new posts will be presidential appointees. I thought too-big-to-fail banks were the pressing issue. Turns out it’s diversity, and patronage.

    — Not that the House is entirely sure of what the issues are, at least judging by the two dozen or so studies the bill authorizes. About a quarter of them relate to credit-rating companies, an area in which the legislation falls short of meaningful change. Sadly, these studies don’t tackle tough questions like whether we should just do away with ratings altogether. Here’s a tip: Do the studies, then write the legislation.

    Consumer Protection

    — The bill isn’t all bad, though. It creates a new Consumer Financial Protection Agency, the brainchild of Elizabeth Warren, currently head of a panel overseeing TARP. And the first director gets the cool job of designing a seal for the new agency. My suggestion: Warren riding a fiery chariot while hurling lightning bolts at Federal Reserve Chairman Ben Bernanke.

    — Best of all, the bill contains a provision that, in the event of another government request for emergency aid to prop up the financial system, debate in Congress be limited to just 10 hours. Anything that can get Congress to shut up can’t be all bad.

    Even better would be if legislators actually tackle the real issues stemming from the financial crisis, end bailouts and, for the sake of my eyes, write far, far shorter bills.

    (David Reilly is a Bloomberg News columnist. The opinions expressed are his own.)

    Click on “Send Comment” in the sidebar display to send a letter to the editor.

    To contact the writer of this column: David Reilly at

    Last Updated: December 29, 2009 21:00 EST

    File Format: Microsoft Powerpoint – View as HTML
    And all these assignments must be recorded! Who Holds the Bearer Paper … False assignments; Fake endorsements; Fraudulent lost note affidavits … – Similar

  14. I have already wrote to my senator, the sec, the federal reserve, the FBI and in my case the FDIC, the Ombudsman and the attorney general. I have also requested FOIA on the FDIC and others including mers which was funny because all MERS did was refer me to the servicer. ” lol” AS they did when I asked them about the fradulent assignment signed by them transferring the loan from a defunct company that is in FDIC receivership.

  15. Hi All, Is it just me or do many posts just vanish? I posted this yesterday a few times and don’t see it anywhere.

    Please take a few moments to watch what one man can do.

    Everyone should see this series of videos!


  16. It started with a simple letter to my Rep in Congress, then Governor Christ, Attorney General McCollum, the County Manager, Clerk of Court, Circuit Court Administrator (am I forgetting anyone).

    This is not my first set of communication with these folks and sometimes I wonder whether or not I am really communicating this well enough for it to sink in. Then I think, maybe they are conditioned to believe that way because any change to the status quo may upset a few things (just a few). When you read the comments from Mr. Ellis our Clerk of Court you will get the gist of what I am trying to covey… hopefully.

    Okay have a great evening and GOD Bless you and your families!!!

    All the best…



    RE: Assignment Fraud… Felony?‏
    Sent: Tue 12/29/09 11:33 PM
    To: Scott Ellis (

    Attachments: 1 attachment
    2009 NSP_…ppt (678.5 KB)

    Mr. Ellis,

    These documents are a direct link to the biggest heist any of us could ever fathom, it’s the reason why the US economy tanked. The fact is MERS is not licensed to do business as a lender in any of the 50 states. I know that the Clerk of Court has missed millions of dollars in revenue by way of MERS taking place over proper assignment and discharge of mortgages.

    For example, my mortgage was assigned to SunTrust but they never appeared on record as having an interest in my property. It (MERS) conveniently masquerades as a lender on mortgage and title but they are not qualified to do so and basically cover for the fraud that is taking place on multiple levels on the back end of the transaction. Notes are subsequently collateralized and swapped and sold and insured and a lot of people across the securitization chain have an interest in the property (see attached power point).

    Except in my situation Wells Fargo Bank, N.A. was the Master Servicer and also the Securities Administrator. HSBC Bank USA, National Association was the Trustee, Suntrust Mortgage Inc. was the Servicer Sponsor and Seller & Bear Stearns Asset Backed Securities I LLC was the Depositor.

    Lost note?

    But there is absolutely no chain of chain of custody recorded in public record. Has anyone ever challenged the validity of having a non-lending company recorded as lender? We may as well call them SCAM-MERS. It’s not about locking up the mortgage system. It’s about having a chain of title that is “proofed-up” on uncontested foreclosures where MERS and “lost note affidavits” are at hand.

    Doesn’t an assignment of mortgage from somewhere out of left field from Chase employees acting as VP’s of MERS to Chase raise a red flag?


    TA Webster


    Subject: RE: Assignment Fraud… Felony?
    Date: Tue, 29 Dec 2009 18:47:39 -0500

    I think this has been an accepted practice for a number of years with co-indexing the electronic firm and the lender, Mr. Webster. MERS is simply an agent for MFC Mortgage is the assignment. You would need to track agreements between MERS and MFC to determine their agency status.

    The foreclosures have been going through based on original notes, although we certainly had a flurry (finally) of Assignments coming in. There is no way any of the foreclosures will be stopped on this issue.

    In practical terms, to do so would completely lock up the mortgage industry even further than it is now. No mortgages would be written as the legal issues were cleared.

    Thanks, Scott


    Sent: Tuesday, December 29, 2009 5:36 PM
    To: Scott Ellis
    Subject: Assignment Fraud… Felony?

    Mr. Ellis,

    This is where the rubber meets the road! Attached please find a copy of the recorded Assignment of Mortgage from MERS to Chase (on my home).

    The problem is, the two individuals who signed as VP of MERS are actually employees of Chase. So the assignor and the assignees are one and the same. From what I gather this is a third degree felony (see attached FL fraud statutes). Please reply with your thoughts when time permits. Thank you!

    TA Webster


    Subject: FW: MERS_Foreclosures & Securitized Loans
    Date: Tue, 29 Dec 2009 17:14:15 -0500

    Mr. Ellis,

    I appreciate your time and effort. Can you have someone in your IT department create a custom data query to obtain the information? It would take me forever to go through those entries one at a time. Your input is greatly appreciated!

    TA Webster


    Subject: MERS_Foreclosures & Securitized Loans
    Date: Tue, 29 Dec 2009 17:04:50 -0500

    Dear Governor Christ,

    I am writing to you today to ask for your help. I am searching for answers to why more than 60 Million homes in America now have “toxic titles” as a result of securitization and how men, women and families are being forced into homelessness unnecessarily.

    This is largely a result of MERS and securitization. Lost note affidavits are commonplace as many legal scholars speculate they were intentionally destroyed to stop the audit trail.

    TARP, AIG, AMBAC and other forms of excess remuneration have paid off many of the notes in the MBS pools and it is next to impossible to get the loan servicer to offer up information relative to the MBS pool, the SIV or SPV that was designed to hold these mortgage notes.

    Is it possible that the notes were never delivered to the trust, only pledged, similar to the naked short sale that is prominent on Wall Street? Yes.

    Is is possible that the servicer is taking the property out of trust without consent of the trustee or investors who are “at risk” (aka the real lender involved in the transaction)? Yes.

    Is it possible that the REAL lender (the investor who purchased the securities, aka – holder in due course) may come back to make a claim on the property? Yes.

    Will a title insurance company cover any such claim? Probably not.

    My question is this; why are we needlessly putting more people out of their homes and onto the street when the new purchaser on a foreclosed home will likely not be able to get clear title to the property? Why are lost note affidavits commonplace but magically appear after the borrower has left the home?

    Since taxpayers now own about 80% of AIG, as well as Fannie/Freddie & our generous outlay of TARP money, don’t we collectively have a right to know who the REAL parties of interest are on these loans, who the REAL counter parties are to AIG/AMBAC payouts and who REALLY owns these notes?

    I understand that these mortgage notes were insured up to 30 times the value of the property. So there is no incentive to modify a mortgage because there is no insurance for that. They only collect if there is a default.

    Since Wall Street lied to investors are we now supposed to believe that they are telling the truth to homeowners? A simple solution would be to have the courts require anyone filing a foreclosure with a lost note affidavit to “prove-up” the chain of custody on these notes.

    I am personally affected by this and have a toxic title to my home as well. I spent more than two decades in the housing industry and lost more than just a career… my industry evaporated.

    Your reply is greatly appreciated. I am available to meet in person or speak over the phone at your convenience.

    Thank you very much and have a great afternoon!

    Best regards,

    TA Webster

  17. Steve,

    I have been fighting my car loans for years finally i get them in court, its a third party collector, faking an affidavit and faking a contract, plus faking the actual namer of the original lender, I verified the debt on him he is a lawyer, he did not comply, LOL this is so funny then he wants to change the name of the Plaintiff, so I objected, then he motioned to strike my motions for judgement and for a bond. This has been fun we are in an all out war right now, and its fun for me I could not find not a lawyer to help me, of all the lawyers I have helped.

    But I did very well we now have a hearing on the 7th of Jan 2010 I am going for money damages and a quiet title on the car. Two cars FDCPA and FCRA are some very powerful tools when used timely.

    i will let you know.

  18. Aoccdrnig to a rscheearch at Cmabrigde Uinervtisy, it dseno’t mtaetr in waht oerdr the ltteres in a wrod are, the olny iproamtnt tihng is taht the frsit and lsat ltteer be in the rghit pclae. Tihs is bcuseae the huamn mnid deos not raed ervey lteter by istlef, but the wrod as a wlohe. If you can raed tihs, psot it to yuor wlal. Olny 55% of plepoe can.

  19. I am grateful for people like Elizabeth Warren, and yes we should contact our representatives urging them to support her, in her quest for truth.

    Someone should send her a link to this site.

    The scale of this scheme is so huge it is difficult to wrap your mind around it.

    I have learned this, the more complicated a transaction is, the more likly there is fraud.

    Thanks Neil, A better friend the homeowner never had.

  20. […] Elizabeth Warren. This is an awesome recognition of someone who may be able to eventually help us! There is a call to action here too… Let's help Ms. Warren out and contact yur senators and […]

  21. Maybe this thing needs to be attacked on a broader level. Not only mortgages; but credit cards, car loans, and student loans aren’t worth the paper they’re printed on. I’ve known too many people who’ve had cars repossessed or been sued by CC companies.

    Challenge everything; none of these so-called “lenders” are in the right, and yet they’ll all gladly screw us over for the fillings in our teeth. Hit them from all sides; make them pay for a change.

    Sadly, this country is based on putting people into debt and keeping them there. It’s blatant oppression and supression; the likes of which makes the former Soviet Union look like Disneyland.


  22. HEY smallz, maybe you missed the point here of what Neil
    was trying to make, CONTACT YOUR LOCAL CONGRESS

  23. As usual, my form is poor…but I have to put this somewhere.

    I’ve spoken with this gentleman.

    This video does not contain all the details of his personal situation.

    His Pro Se lawsuit is extraordinary and a ruling from A Federal Judge is pending. Please help spread the link!

    If it doesn’t work I’ll re-post with a x in front of the URL.

  24. Hi,

    Maybe it’s in here but just can’t see it…..

    If anyone can provide contact info for Ms. Warren I’d greatly appreciate it.


  25. @ SoCal Gal, I have long since emailed Ms. Warren on more than one occasion through her .gov website.

    I sent copies of lawsuit(s) against MERS, Countrywide, Recontrust to that same .gov website.

    Yet, I hear nobody talking about MERS.

    But at the same time, according to the AP – “Treasury removes cap for Fannie and Freddie aid”

    This is unbelievable to me!

    No need to waste your money on Oliver Stone’s Wall Street 2.

    Just look at Fannie and Freddie.

    So now, Fannie & Freddie – the gov’t run slush fund – is being propped up with the help of honest respectable companies like MERS, Countrywide, Recontrust and the thousand of mercenary like servicers looking to pick whatever is left of rotting inventory of empty houses.

    Never mind the fact that companies like MERS, Countrywide, Recontrust can’t even prove they own the real property the mortgage securities are based upon in court of law without tap dancing on fraud and perjury.

    If Barofsky and Warren have read for more than 10 min. on this website, then they should KNOW what the hell is going on.

    It looks like Fannie & Freddie is being “funded” by treasury just to prop up its Securities and Bonds purchased by overseas investors even though the securities are “TOXIC ASSETS” and un-linkable to the real properties they’re supposed to represent.

    If lending institutions have no chain of title to show the borrower, it’s reasonable to conclude they have no chain of title to an investor either.

    It sure seems as if the “bad bank” once talked about, has now become Fannie and Freddie who actually hold most, if not all, of the original TOXIC ASSETS that represented 1/2 of all US Mortgage debt as far back as the spring of 2008.

    There are Millions of mortgages that read:

    “This is a Fannie/Freddie instrument created with MERS”

    To me, that means someone thought this out.

    Instead of the private banking institutions coming to gobble up property at pennies on the dollar as in past man-made depressions, this time around, The private property is being hijacked by the banking establishment under the veil of government in the form of Fannie Mae, Freddie Mac and MERS.

    Fannie and Freddie where quasi-gov’t and everybody knew it. This was evident in their “implicit” guarantee of gov’t assistance, which they are currently getting to the tune of over $400 Billion between them.

    Is this Facism?

  26. smallz,

    We all feel your pain, but have your written your senators and congressmen supporting Elizabeth Warren’s efforts (as Neil suggested)? Perhaps, that is where, collectively, we can make a major difference.

  27. We are great fans of Professor Warren and the blog Credit Slips where she is kind enough to impart her very impressive legal prowess of contract law to which we cobble up her post with passion and truly adore her and her very esteemed colleagues post and thank them for their continued public service contributions. We intended to contact our congress and demand they provide the good professor with the tools she knows we need her to have and that she must have in order to put these dirty dogs to rest and on a short leash and that will unleash and free all the defrauded investors and citizens affected by greed and obscene Wall Street Profits at the expense of the populist/Americans. Neil is right and we agree with Neil Garfield, these Banks and Government are terrorist….Yes Government included except Ms. Kaptur, but these terrorist must be eradicated from our society as they have no legal, moral or ethical purpose other than to continue to terrorize the American public. We must start banning together and not be discouraged so easily. Neil is right, if enough of us complain, our government must respond. Thanks for the hot tip and am contacting our congress today. tim

  28. I love Ms. Warren & Mr. Barofsky as the TARP cops but I’m also a realist.

    And the only people I see going to jail this holiday weekend are on Steven Segal’s new show “Lawman” on A&E.

    Although there’s a boatload of “regulatory oversight” there is also an absolute lack of “regulatory enforcement”.

    Is it possible to have regulatory oversight without regulatory enforcement?

    The lack of real law enforcement has become so blatantly obvious, the Entertainment industry goes about “relieving social pressure” by soliciting “actors” (who merely portray law enforcement on TV) to solve real life crimes and make real life arrests.

    (((Shaking my head)))

    Meanwhile, the TRUE criminal element in the society is the White Collar Criminal living in a suite NOT THE poor man and woman living on the streets.

    People have always committed crimes according to their skill level.

    Therefore Law enforcement should be a hell of a lot more concerned with the criminal tendencies of an investment banker or a Lawyer than the criminal tendencies of a poor homeless man or woman.

    If Warren and Barofsky are really going to do something, they’ll see that ALL of the perpetrator’s are put in jail and not allowed to roam free to continue their financial massacre on trusting, unsuspecting, simple, everyday people.

    And America is supposed think Madoff worked alone?

    Have you ever seen someone rob a bank alone?

    No get-away-driver? No Look out? No crowd control?

    Gimme a Friggin’ break!

    Even further, Ken Lewis openly admitted in the national press that he was coerced into the M. Lynch “merger” that made NO SENSE to anyone at the time. Yet, unless I’ve been misinformed, Ken Lewis was never disposed or questioned under oath about this? What better evidence to indict a suspect other than the suspects own admission?

    Are our US regulators operating under duress? Does someone or something have a proverbial “gun” pointed at the head of US Lawmakers?

    Ken Lewis admitted out of his own mouth that he was threatened in reference to the Merrill Lynch acquisition. Bloomberg covered the story well. But of course, Bank of Amerikkka has now changed CEO’s before any investigation could be conducted, which effectively contaminated the “crime scene” and “hid evidence”.

    No conspiracy there Jesse Ventura.

    Well, it’s nice that the TARP cops “have our back”, but the real question is, who the hell is “watching our front”? Barofsky and Warren might be the best TARP cops, but at least Steven Segal Kicks some ass.

  29. Only in America.


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