Trusts, Trustees and Beneficiaries


These statutes provide numerous regulations and requirements that entities engaging in trust activities should comply with, but the regulations are largely being ignored by the entities engaging in trust activities and both courts and the enforcing agency, the Florida Department of Financial Services,

Editor’s Note: Matt Weidner is onto something here that has been pointed out by many lawyers across the country. His central point is that if you want to call yourself a Trustee in foreclosures then there had better be a trust. If there is a trust the state laws, rules and regulations govern them and the trustees. Most of these laws are being ignored by the pretender lenders with impunity — Judges routinely ignore arguments concerning the authority of the Trust to do business in the state, the right of the Trustee to proceed with foreclosure, and the accountability to both the borrower and the investor, both of whom might be beneficiaries under the Trust. Greenwich Financial filed suit against Countrywide and BOA to underscore the point that the investors are the creditors and that if there is a trust, it is the investor who is the beneficiary. Yet, as Charles Koppa has pointed out numerous times, the prices on the courthouse steps are routinely manipulated against the interests of any beneficiaries.

But the real question in my mind is whether these “trusts” actually meet the definition of that term. for there to be a working trust and an authorized trustee, there must be a trustor (the one who creates the trust), a beneficiary (the one who receives the benefits from the trust) and a “res” which is something of value that is put into the trust and which is owned, rather than passed through the t rust.

The trustor must have some property interest (tangible or intangible) that is being conveyed to the trustee to hold in trust for the beneficiaries. I’ve looked at the pooling and services agreements, prospectuses, assignments and assumption agreement and individual assignments, alleged powers of attorney and the promotional literature of the Special Purpose vehicles that issued mortgage backed securities (bonds) to investors who end up holding a piece of paper called a “certificate.”

In my opinion, there is no trust, even though one is named. In my opinion there is no trustee, even though one is named. Beneficiaries are not named and the res of the trust which supposedly is a pool of loans has been conveyed in percentage slices to the investors who bought the certificates.

There is no Trustor identified in most cases although there have been arguments of the pretender lenders that the investors are the trustors and the beneficiaries. There is also the argument that the pooling and service agreement allocating a “pool” which more often than not initially contains fictitious assets contains a  Trustor somewhere in the document.

In my opinion the party designated as a Trustee is merely a candidate for an agency relationship that might arise if several conditions are met, as defined in the prospectus. The agent has no liability or obligations of any kind until those conditions happen at some time in the future.

And since the res of the trust allegedly includes a pool of loans that was owned by some vaguely defined pool aggregator or “trustee” and since the percentage interests in that pool was conveyed to the investors, it is my opinion that there is no res in the so-called trust (i.e., there is nothing being held in trust). If there is nothing held in trust, then even if the trust technically exists, the trustee has no powers. This is congruent with the REMIC provisions of the Internal Revenue Code that allow the SPVs to be formed as pass through entities in which no tax event occurs and therefore no tax applies.

So back to Weidner’s point, if the trust is real, it isn’t following the laws governing their creation and use, OR, to my point, the trust isn’t real anyway. It is for these reasons, among others, that you MUST identify the investors, get in touch with them, compare notes and get an accounting from them. If the Courts ever force the pretender lenders to disclose the identity of these creditors and allow you to pursue interaction with them, then, and only then, will the alleged default be validated, the demand on the note verified, and the possibility of financial double jeopardy eliminated.

Florida Statutes Chapters 658 which regulates Banks and Trust Companies and can be found at and chapter 660, the section of Florida Statutes which specifically regulates trust business in Florida and which can be found at are two important consumer protection statutes that are being widely ignored by regulators and courts across the state.

The definition of trust activities provided in statute is very broad and specifically includes many of the activities national banks and foreign corporations engage in related to mortgage foreclosure activities. An analysis of foreclosure cases filed in counties across the state will reveal that a recognizable percentage of the cases are filed “as trustee” for some other party or entity. ignoring the laws and the application of these laws to entities that are violating them. These statutes provide numerous regulations and requirements that entities engaging in trust activities should comply with, but the regulations are largely being ignored by the entities engaging in trust activities and both courts and the enforcing agency, the Florida Department of Financial Services,

Homeowners who are subject to foreclosure and foreclosure defense attorneys are encouraged to carefully review the cited statutes and consider the application of the statutes to each individual case. Lenders who are engaging in trust activities but who are not properly licensed or registered to do business in the state should be prevented from prevailing in foreclosure actions on equitable grounds based on their failure to comply with these important consumer protection and state interest laws.

25 Responses

  1. […] Trusts, Trustees and Beneficiaries […]

  2. Re: Trusts

    I believe this area could be one of the most powerful in the defense to mortgage foreclosure.

    The foreclosing entities (“bank”, servicer, fraudster) usual response to any reference to the A to D transfer, or any other reference to failure to follow the requirements of the registration documents by these folks, is to say that the borrower is NOT a third party beneficiary to the pooling and servicing agreement contract, and as such has no rights to enforce the agreement.

    I take a different tact (warning I am an attorney, but if you arent in Connecticut or Massachusetts this may not apply to you, and in all cases this is not meant as legal advice).

    My approach is to say that in all cases these SPV / SPE entities were set up as express trusts, or business trust, massachusetts trusts, etc. (under NY or Delaware law). As such, these “folks” chose to use the trust as the business formation of choice, they did so to avoid the statutory impositions placed upon corporations, but more inportantly the trust was chosen due to its extreme flexibility, and elegibility for REMIC status.

    This flexibility does have a limit, and that limit is the trust or indenture agreement (not p&s contract as third party beneficiary). By not following the reuirement of the trust agreement, my argument is that the trust res was not properly conveyed to the “trust”, and therefore even if the trust held any assets (which those of us that are informed on the subject know they dont), the trust is not the proper party to be able to enforce the obligation (yet another standing arrow to shoot).


  3. After a closer look at trust law (see Gilbert Law Summeries on Trusts by Edward C. Halbach Jr), the 4 critical elements of a trust are: 1. trust intent. 2. specific trust res or property. 3. properly designated parties. 4. valid and legal trust purpose. A grantor/trustor must objectively manifest a final, definite, and specific intention that a trust should immediately arise with respect to some particular property. Grantor/trustor/settlor must express his/her purpose and intent and must own both legal and equitible title of trust res property (the note) prior to transfer or assignment. A valid trust forms the moment trust property transfers to a trustee. But banks formed the trust indentures way before they received our notes as trust property. You can’t form a trust with the prospect of receiving property at a future time. In the many mortgage trust indentures found on the SEC website, the “acting” grantor is actually the trust itself called the “issuer” or a second trust created to act as a “strawman grantor.” The questions arise: how on earth can a dead legal fiction manifest an intent or purpose? And how can a legal fiction transfer trust property to a trustee for the benefit of an class of ascertainable beneficiaries? And the million dollar question: Why can’t we be the grantor and beneficiary of the note (negotiable instrument) bearing OUR signatures? Who could possibly make a superior claim on our own signatures? There is no doubt that we are in the land of trust and equity. I think our remedy will ultimately lie in the land of equity. We keep getting beat up in the land of Debtor/Creditor and UCC. Maybe an education in trust will level the playing field. I think we have been led astray by the misconception that trusts are stricly reserved for asset protection and avoiding probate. Hmmm.

  4. Here is a link to SEC website which lists the
    J.P. Morgan Alternative Loan Trusts.

    You may want to investigate the trusts listed here to determine if your loan is within one of these securities trust (mortgage pools).

    OR at the SEC main page, click on search in upper right corner.

    In the search field over on left type in the ‘company name’ filed J.P. Morgan Alternative Loan

    hit button starts with

    hit button includes – where it says ‘and ownership’

    lastly hit find companies

    (all that should be inside the blue box on left side)

    This will bring up the entire list of the securities trusts with the J.P. Morgan Alternative Loan in the name…..

    Once you see the list, click on the CIK number and it will bring up a list of filings

    You want to mostly look for any FWP and any 424B5 files and preferably the more easy to read version of the html.

    Again, these could have your loan number listed within.

  5. Key to JPMorgan Chase or JPMAC naming conventions for SEC searching——

    If you get to the SEC website and search on the Chase filings under JPMAC, these are the naming conventions they use:

    ACC = Accredited Home Lenders
    CH = Chase Home Finance, LLC
    CW = Countrywide
    FRE = Fremont Investment & Loans
    HE = Ownit Mortgage Solution and Novastar
    NC = New Century
    RM = ResMae
    WMC = WMC Mortgage Corp.

    And, you may see a number after the acronym, such as NC1 and then NC2.

    These mean different deals or mortgage pools from the loan originator.

    You may very well find your loan number and other particulars listed, especially check the FWP or free writing prospectus.

    See my prior post or Neil’s post on how to search at the SEC website.

  6. I believe shelf registration means the securities underwriter, in this case, Citigroup Global, is allowed to withhold securities for sale in order to wait for a more favorable time to sell to public. Believe can be shelved for 3 years without filing new registration doc. No write off – if the securities were eventually marketed. Not sure what you mean as to ownership interest lies within a 1999 Trust – except that often names are changed – and therefore SEC will file accordingly grouping under old and current names. If they could sell under shelf period maybe they just put the loans in the old trust??? These were REMICs – something is very wrong if that is the case.

    Tax payers and TARP is another issue. In my opinion, the people – not the banks should have been bailed out – would have cost a lot less. The damage the banks did to this country will prevail for decades – with or without TARP.

    Not a lawyer DIsclaimer – and this is meant for educational purposes only – not to be construed as legal advise..

  7. ” The actual loan appears in the EX-99 of the old trust. Also found it in the monthly reports on the Wells Fargo Securities site as “in foreclosure”. I guess I’m asking who really took the write-off? ”

    Tax Payers took the hit through tarp./

  8. ANONYMOUS, I have question you may or may not have the answer to. The Wells Fargo Home Equity Trust was sponsored, originated, deposited, administrated, etc., by Wells Fargo. The Securities UNDERWRITER was Citigroup Global Markets. HSBC as trustee. The counterparty for two deals was Bear Stearns, the other two were Goldman Sachs deals. This entire 2005 vintage (05-1,2,3, and 4) of deals was “shelved”. “Ownership interest” lies within a Wells Fargo 1999 trust. The question is: Didn’t Citigroup Global Markets, as the Securities Underwriter, take the write-off if the deal was shelved? Or does “shelved” imply that Citigroup was unable to sell the certificates and returned them to Wells? The actual loan appears in the EX-99 of the old trust. Also found it in the monthly reports on the Wells Fargo Securities site as “in foreclosure”. I guess I’m asking who really took the write-off?

  9. Feedback would be greatly appreciated on this one…

    We filed a Quiet Title Action in October 2009 after the break was found in the Chain of Title when Citi Residential Lending acting on a Limited POA for Ameriquest assigned Mortgage directly to Deutsche Bank/Trustee for Pass Through Blah Blah Blah…

    This “assignment” from Ameriquest to Deutsche was a DOCX/Linda Green/Tywanna Thomas job.

    Foreclosure was scheduled for November 2009 and TRO was “denied” because the Judge did not see harm in allowing the foreclosure to proceed since actual Title “does not transfer until the end of the six month redemption period” and the sale was allowed to happen. We are in Minnesota.

    Trial is scheduled for this upcoming September for the Quiet Title and our “Redemption Period” runs out in May…

    Here is my question…

    Has the “redemption period” actually even began since there is no marketable title???

    We cannot sell in order to exercise our redemption due to the title defect…

    We could not obtain new financing to exercise our redemption due to the title defect…

    Technically we are being denied the rights to redeem and “cure”…

    Would the UD even be allowed with pending litigation???

    Any Thoughts???

  10. Very interesting the Federal Home Loan Bank of San Franciso action against the security underwriters.

    FHLB is asking for rescission of the contract. Damages to restore to prior position is the “consideration that the bank paid for each certificate with interest theron, less the amount of any income that the Bank has received thereon, upon the Bank’s tender of each certificate” . Thus, if FHLB, as an investor was entitled to forelose on your home – FHLB could not even attempt to rescind because they have ongoing “recovery” in the right to your home property. Fact is, FHLB was only entitled to an pass-thorugh of the current payments in the collateral pool.

    Also, if anyone has ever read a Mortgage Loan Purchase agreement, the originator sells the loans to the Depositor, the Depositor assigns the loans to the Trust, and the Trust sells the certificates to the security underwriter (the Depositor is usually subsidiary of the securitiy underwriter – unless the Depositor was simply set up as a “shell” in the case of certain orginators.

    The attorneys for this case state that the Trust sells bonds to the investors – but this is not right. The Trust sells the certificates to the security underwriters and the underwriters sells the security bonds to investors.
    The trust never issues certificates directly to investors. The trust also does not pay money to the originator – the depositor pays money to the originator.

    Most importantly, the bond securities, do not entitle the investors to foreclosure recovery, as the FHLB case clearly indicates. The bond securities only entitled investors to a current payment pass-through of the receivables removed from the security underwriters balance sheet to an off-balance sheet conduit – also owned – but not accounted for by the security underwriter.

    I do not know why a class action has not been started to challenge the foreclosure fraud. Power in numbers.

  11. My opinion is that there’s definitely a Trust.

    I believe that Wall Street creates the Special Purpose Vehicles who subsequently creates the Trusts.

    I believe that the Special Purpose Vehicles are the Trustors and Beneficiaries of the same.

    I believe the Trustee is whomever they nominate.

    I believe that the corpus of the Trust is a pool of fictitious mortgage loans which are deemed financial assets and credit risk rated.

    What I mean by “pool of fictitious mortgage loans” are a pool consisting of the prospective and or projected value, of intangible never to be funded mortgages.

    I believe that at the Beneficiaries direction, the Trustee issues securities to the Investors backed by the financial asset.

    I believe that the Investor purchases beneficial ownership in the pool (financial asset) as it lies within the Trust.

  12. BSE

    Securitization is very complicated, and as Mr. Weidner points out, all the issues discussed here are important. I find this recent post “Trusts, Trustees and Beneficiaries” very interesting. If we look at securitization in terms of financial accounting, it is the sale of the Bank’s (Wall Street) receivables that are sold to the trust – the trust is owned by the Wall Street bank. Receivables are a current asset in financial accounting. In effect, when a receivable cannot be collected – it must be written off by the bank who accounts for the receivables. A trust has no balance sheet – and does not account for anything. In most securitizations the depositor to the trust and the security underwriter of the trust, are subsidiaries of the Bank who purchases the mortgage loans from the originator. The banks were able to conceal the trusts from publicly available financial statements by removing receivables from on balance sheet to “off” balance sheet conduits(pass-throughs) that are were not accounted for on current statements. This is now being changed since with FASB Rules 66 and 67 – the banks must bring these off-balance sheet conduits back onto their balance sheets. Further, since securitization must be for current receivables – it is not profitable for banks to retain default loans, in fact in harms them. They dispose of them when they can, and at the best price for portfolio sale. If the bank is not able to dispose of default loans – then it is the bank owns your home. Someone has has to account for “recovery” of collateral in foreclosure – a Trust accounts for nothing – and, again, it is only set for pass-through of current payments. In securitization, when loans are in default, they are subordinated to the lowest tranche and swapped out by direct sale or swap agreement. The party having rights to the lowest tranche purchases these rights at discount, and makes a bundle in foreclosure. The investors who had pass- through securities lose on their investment and partial principal in the process (the rest is recovered via swap protection). This is part of the reason for “investor” lawsuits. Someone else – not the security investors is making the money in foreclosures. When collateral is realized in foreclosure – the money is not paid to the trust, and not accounted for by the trust. This is because default loans are charged-off and rights to collection removed from the trust – a foreclosure is not a current pass-through security – and will not account for the recovery. Find the above post very interesting because it points out that there is no “Trustor” – someone must own the trust in order to pass on cash flows to named beneficiaries. In my opinion, the Trustor is the bank that owned the depositor – that is the bank (security underwriter) owns the trust. .

    In, some securitizations, the depositor is a subsidiary of the originator (example in Ameriquest issues). One, these originators are gone – who accounts for them now?, .Two, these securitizations were fraudulent from the onset because the loans are sold to the security underwriters at the onset and Ameriquest had no receivables left to pass-through to a trust.

    Bottom line – where is your loan now – and who is accounting for the rights?? .

    Disclaimer – I am not an attorney and this is not meant to be construed as legal advise. – it is meant for educational purposes only.

  13. Can anyone provide information on going after a lenders
    e&o and fidelity bond? Once you have the insurer can a
    pro se effectively file a claim and demand payment or will
    it take correspondence fro an attorney?

    Hey where did the Homeowner and Attorney tabs go? There
    were lots of great discussions on those threads. How do we now find all of that. It would be great if we could register on this site and
    then be able to search for other peoples comments by their
    name. Sometimes I want to go back and find something that
    was posted by Jan, usedcarguy, anonymous, Maher and others
    but can’t remember which thread it was in. In a perfect blog
    that would be so helpful. Just dreaming out loud.

  14. Great post and thoughts and fantastic site. Well-educated and informed consumers are essential to righting what is wrong with this country right now. Understanding the information contained on this site is critical. It is surprising how many people do not even respond to the foreclosure law suit, but I am equally impressed with how many homeowners are using information off this site and others to go after the lenders aggressively–and they are causing the lenders fits!
    Keep up the good work….the tide is turning. If you’re in Florida make sure you’re citing BAC Funding and Verizzo in all cases….it stops em dead in their tracks!


    I am trying to understand more about Current Receivables, pass thru and off-balance sheet

    I am very much a layman when it comes to accounting and Wall Street trickery.

    Please explain..



  16. Hi Abby –

    Trigger for default is to package fairly good – and performing loans – with actual seasoned defaults to obtain a good price for the sale of the “portfolio” – so designated – “non-performing” loans to the potential buyer. Defaults are usually not sold individually – but rather packaged with other loans for sale.

    In contrast, “repurchase” loans are sold individually to the originator – and the originator packages these loans with other repurchases for sale – or they can sell the loan individually.

    All has to do with price in portfolio acquisitions.

  17. Terrific post Anonymous!!

    Can you perhaps explain why then do they ‘create’ or make a trigger for a default? There has to be more reason than just collecting the credit default swaps and moving the default to a lower tranche & then selling that off in a default-distressed deal to some other entity.

    It must have to do with their accounting.

  18. Mr. Garfield’s last post on Judge Buford and MERS is important to demonstrate that not all judges are bought and paid for. And, again, I emphasize that Mr. Garfield’s workshops are essential. However, given the host of cases that have come down against home owners, it is certainly reasonable for consumers to have doubts about our legal system. And yes, even if the courts were to suddenly turn in home owners favor, then what about all the people who have already lost their homes under fraud?? (Possibly a reason why judges refuse to admit error and side with homeowner)

    Many attorneys are simply afraid to be recognized as the “enemy” of the judge- and therefore, either refuse to take cases or to appeal when appeal is justified. True, some problems lie with attorneys who are afraid to stand up..

    As far as Trusts and trustees and “empty” trusts – which hold nothing – I agree. But the trusts were a sham from the beginning – a front ( words from a prominent legal firm who no longer exists – but signed many SEC documents for securitized trusts) for Wall Street to conceal purchase of the mortgage loans.. Do not like to sound like a parrot – but, in securitization, the security underwriters purchase the loans and records the receivable mortgage payments on their Current Asset ledger – for accounts receivables. These receivables are subsequently sold to security underwriter’s off-balance sheet conduits (trusts). But all that is sold is pass-through of the Wall Street entity’s CURRENT receivables ( and there is a question of “valid” sale of these receivables).. While investors in the subsequently derived securities from the the receivable trust, have a claim against the receivables (held in off-balance sheet conduit to keep the pass-throughs as bankruptcy (of the security underwriter) remote – these claims are only for the CURRENT receivables. The investors in theses CURRENT receivables have no claims once the loan is no longer CURRENT. The TRUST was set up for CURRENT receivables ONLY. Delinquent loans are removed – although servicing remains in the hands of the servicer to the Trust. Default loans rights are subordinated to the lowest tranche and removed by portfolio acquisition. Thus, the trustee’s duties cease when the receivables are no longer current. Mr. Bernancke has emphasized this. The note always remains with the purchasing Wall Street bank security underwriter at origination sale (table-funded)- ONLY the Current Receivables are passed through by securities derived from the receivable collateral in the off-balance sheet conduit. The conduits were set up simply to remove receivables from the acquiring Wall Street bank. BUT THIS WAS FOR RECEIVABLES ONLY. REMIC pass-throughs are only for current receivables. The Trust holds the loan obligation to pay current payments as collateral for pass through of current receivables only – no securities exist for default loan/receivables. This is SEC regulation for mortgage-backed security receivables.

    We need to focus on the attorney fraud for whom they claim to represent in court. We need to demonstrate and prove this in court. We need to focus that delinquent loans are removed from CURRENT receivable pass-through trusts. We need discovery as to all assignments – including removal of default loans (because there is no longer a current receivable for a mortgage-backed receivable security trust pass-through) We need to express these thoughts in court and before the United States government. We need to emphasize that third parties (hedge funds/private equity/debt buyers) are making huge profits on foreclosures by purchasing default loans from CURRENT RECEIVABLE TRUSTS – at steep discounts – and, by concealing the CURRENT creditor, and that borrowers have been denied negotiation for valid modifications, as mandated by HAMP, with the actual and CURRENT creditor.

    If we do not acknowledge that the CURRENT RECEIVABLE TRUST -disposes of default/delinquent loans – and that the current creditor is being concealed in courts of law – we will continue to have case after case dismissed by judges. Judges will continue to protect “investors” – because they, themselves are investors. But these “investors” have NOTHING to do with rights to your loan that is in default. It is not the same “investors”. The investors who have an interest in your loan are not investors in CURRENT receivables pass-through trusts. They are investors in default debt – who are never named in court. This is the way it is..

    The original security investors rights to receivables (in the pass-through trust) are kaput – gone – they are finished. There are no more investors in the CURRENT pass-through of your mortgage payments – in any securitized trust – when the mortgages payment is in default. Swaps take care of the investors. We are now talking about what happens when the loan (receivable payments – which were sold to the Trust) are gone – charged-off and dead. If your loan is current – then I totally agree – the original investors in the receivable pass-through of your mortgage payments is the investor – and maybe even your “lender”. But they are not your creditor – they never loaned money directly to you. And they are certainly not your creditor when the loan is in default.

    Again, this must be recognized, and demonstrated, to have any effect in courts of law that refuse to acknowledge any consumer/home owner rights.

    Disclaimer – This is my opinion only – I am not a lawyer – but have been through and seen a lot. This is not for legal advise – but only for educational purposes.

    Fight on – even if you are already a victim – we need your input to restore justice to the American people.

  19. One does not have to wait to get in touch with investors. In some cases, you can find the investor lawsuit and the legal firm representing them. See one of my earlier posts within the last couple months on some Chase securities trusts which are named in investor lawsuit. (JPMAC etc.)

    Write, fax or call that legal firm.

  20. Nearly every Judge in FLorida is bought and paid for by the Bank Lobbyist. The Judges that are pulled out of retirement to hear the FC cases are clueless. Its a serious “good o’l boy network in Florida. APPEAL YOUR CASE!

  21. Then WHY doesn’t a Matt Weidner or others APPEAL this among other arguments ( assuming you lose )??? If you win the appeal, then others have ammunition for defense.

    Stop talking about it, and do it ( Florida ). Its useless to keep writing about something that falls on deaf ears in the lower courts.

  22. My atty filed that “Trustee for Citibank, N.A.” was not licensed in FL. However, my case was dismissed by the Plaintiff for other reasons before any hearing on the motion. Sounds legit to me, but like Confused says, any judge could just ignore it.

  23. Collette:

    I’m also in Colorado and am thinking about adding the “not registered to conduct business as a trustee” to an amended complaint. What oppsition did you run into?

  24. I am in the state of Colorado. Last week I argued that ( non judicial county treasurer is the truatee. I said that, in fact thre is no trust and BOA is not the benficiary even though thye claim to be. The judge wasn’t havin it. She sided with Countrywide/BOA and gave authority to foreclose. I intend to continue at the Federal level. any sugesstions.

    Thanks much appreciated

  25. My only comment is that I raised this issue over a year ago. There was no response to my posts but I went ahead with my gut and put this in my motion to dismiss as well as my answer.

    I am glad that finally an attorney has addressed this issue. Thank you.

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