The Narrative Has Shifted: Take Advantage of it

Your allegations of intentional misdeeds, fabricated documents and forgeries have new life now that the SEC is hot on the trail of the wrongdoers in a very public way. As the news sinks in more and more Judges, lawyers and experts and forensic analysts will see their role more as a commitment to justice than just helping out a homeowner in distress.

It just didn’t make sense that anyone would loan money in a deal where they knew there would be no payback. My allegations rang hollow to many people, who felt that despite the many distractions and defects contained in the paperwork behind the foreclosure glut, it was the borrowers who made the financial crisis happen. Now we see more and more people taking another look.

For those of us who serve the judicial branch of government, it is no longer a dance to delay the inevitable. It is, as it has always been, a confrontation with giant corporations whose reach into the corridors of powers enabled them to suck the life out of an ailing economy.

No society has ever persisted without a vibrant growing middle class. It will be a very long time before we succeed in reversing the damage wreaked by Goldman Sachs and other investment banking houses who acted without any sense of conscience, morality or even compliance with laws that society passed to enable their existence. But now, we have a chance. Let’s not waste this opportunity. Don’t let the pretender lenders get control of the narrative again.

The reality is that many, perhaps most loans were created according to specifications set by Wall Street, not by industry underwriting standards. The reality is that people were hired to lie and cheat and deceive homeowners into investing their homes into this salacious scheme. The reality is that the appraisals were false, and were given greater credibility by the reasonable borrower assumption that no lender would lend money on a bad deal where the property value was intentionally overstated, and that lenders would and did strive to comply with the requirements of the Truth in Lending Law, where the responsibility for appraisal verification, income verification, quality, viability, and affordability are BY LAW the responsibility of the Lender. Little did these hapless homeowners know, TILA was a joke to these players.

So now reality sets in. securities that were rated investment grade were junk and are worth far less than their sale price. Homes that were rated as high value were really still the same value as the market had shown before the flood of money and bird dogs looking for signatures on documents, even if the signatures were forged and even if the borrower was dead.

The finance system depends upon confidence. Confidence is based upon belief in the market values and practices in the marketplace. There is only one correction that is viable now. It is the simple recognition that neither the securities nor the properties they were based upon, had any new “value added.” It is the simple recognition that we had to accept when the NASDAQ that flew near 5,000 is really worth only 2,000, long after the boom and bust of that era. Any attempt to saddle the homeowners, the taxpayers or the investors with anything other than the reality of fair market value will undermine our financial system, and ultimately our future and the future of generations to come.

11 Responses

  1. Bravo!

    I’ve always thought you were right about this, Neil. I felt the same way, too, even in the days when people would ask, “You’re a forensic ‘what’?” People thought I worked for the Coroner’s department! – LOL

    We’ve started a course in forensic loan auditing – a ‘beyond TILA’ class that breaks it down for lay people and professionals (attorneys, CPAs, paralegals, real estate folks, etc).

  2. to “Help:”

    Sure, sue them all. Run up their legal bills and teach the scum a lesson.

  3. to “Angry and Not taking IT:”

    It is not just the people’s lives that are shattered and ruined. Let us not forget the fate of the hapless family pets, particularly the family dogs, who end up left to fend for themselves, or placed with “animal welfare” who then kills them, as there is no room at the Inn for the flood of homeless dogs. As the owners are forced into rentals, and the rentals contain “no pet” clauses, the dispossessed have a Hobbsian Choice: either house the family in a no-pets rental or live on the street with your dogs. So the poor dogs have to go.

    Is it the dogs’ fault that Goldman Sachs wants to steal? Should the dogs suffer because Bank of America is run by corrupt and incompetent managers? Should your dog dies because Wells Fargo is run by pigs? Yet it is the dogs that will suffer – by the millions. And this is why it is your moral duty to declare war on the New York Jews that have no compunction about slaughtering your dog. Multiplied by about four million.

    Make no mistake, and harbor no illusion – you are contending with utter pond scum. They are the vilest scum on the planet. They think nothing of killing your pets – so that they can spend your money after they steal the equity in your house.

    Root them out, and bury them in lawsuits. When the Courts get enough lawsuits against the scum, then – maybe – the Courts will start to stir out of their slovenly lethargy.

  4. WHO WOULD BUY SECURITIES KNOWING THERE WOULD BE NO MARKET IN WHICH TO SELL THEM?

  5. “securities that were rated investment grade were junk and are worth far less than their sale price”

    THESE PUPPETS DESERVE THE FIRING SQUAD >>PEROID
    Then let the banks hide the bodies,like Jimmy Hoffa!
    A. M. Best (U.S.)
    Baycorp Advantage (Australia)
    Dominion Bond Rating Service (Canada)
    Dun & Bradstreet
    China Credit Information Service (China)
    Fitch Ratings (U.S.)
    Japan Credit Rating Agency (Japan)
    Moody’s Investors Service (U.S.)
    Standard & Poor’s (U.S.)
    Rating Agency Malaysia (Malaysia)
    Egan-Jones Rating Company (U.S.)
    Brickwork Rating (India)

  6. “truth and justice will prevail eventually. Because it must.”
    With as many people who have been cast into the streets, justice will not undo those crimes, those lives have been ruined,futures shattered & stolen . That is what justice & equity cannot return. Truly this the tragedy .

  7. Any advice- thinking about Neil’s editors notes-

    Regions Bank sold our loan to a Trust trying to foreclose now. I am thinking about suing Regions for unjust enrichment and fraud and collusion for not disclosing to us that our loan was paid in full already. Any thoughts, ideas?

  8. Well once in a while just once in a while justice is served. I personally have more faith in karma but hold a deep belief that truth and justice will prevail eventually. Because it must.

  9. The legal system is corrupt. I do not trust lawyers or judges. We had enough proof that should have put the bank employees and their lawyer in jail but the judges are corrupt. I will not give up and come hell or high water I will get our story exposed and get justice. We were never in arrears our bank refused payments. Over $150,000 paid in 5 yrs and zero applied to our principal. It took 4 1/2 yrs to get our closing papers. This is just 2 of over 20 charges.

  10. Department of Justice Press Release

    For Immediate Release
    April 16, 2010 United States Attorney’s Office
    Eastern District of California
    Contact: (916) 554-2700
    Stockton Real Estate Executive Pleads Guilty to Bid Rigging at Auctions of Foreclosed Properties

    SACRAMENTO, CA—United States Attorney Benjamin B. Wagner and Assistant Attorney General Christine Varney of the Department of Justice’s Antitrust Division announced today that Anthony B. Ghio, 43, of Stockton, pleaded guilty today before United States District Judge Edward J. Garcia to conspiring to rig bids at public real estate foreclosure auctions held in San Joaquin County.

    These charges arose from an ongoing federal antitrust investigation of fraud and bidding irregularities in certain real estate auctions in San Joaquin County. The investigation is being conducted by the U.S. Attorney’s Office for the Eastern District of California, the Antitrust Division’s San Francisco Office, the Federal Bureau of Investigation, and the San Joaquin County District Attorney’s Office.

    According to Assistant United States Attorneys Robin R. Taylor and Russell L. Carlberg, who are prosecuting the case with assistance from Barbara Nelson and Richard Cohen of the Antitrust Division, Ghio admitted in his guilty plea that he conspired with a group of real estate speculators who agreed not to bid against each other at certain public real estate foreclosure auctions in San Joaquin County. The primary purpose of the conspiracy was to suppress and restrain competition and obtain selected real estate offered at San Joaquin County public foreclosure auctions at noncompetitive prices.

    Court documents show that after the conspirators’ designated bidder bought a property at a public auction, they would hold a second private auction. Each participating conspirator would submit bids in the private auction above the public auction price. The conspirator who bid the highest amount at the end of the private auction won the property. The difference between the noncompetitive price at the public auction and the winning bid at the second auction was the group’s illicit profit, and it was divided among the conspirators in payoffs. Ghio participated in the bid-rigging scheme from April 2009 until October 2009.

    Ghio is charged with bid rigging, a violation of the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victim of the crime, if either of those amounts is greater than the statutory maximum fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.

    The investigation is continuing. Anyone with information concerning bid rigging or fraud related to real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-436-6660 or visit X_http://www.justice.gov/atr/contact/newcase.htm, or the FBI’s Sacramento Division at 916-481-9110, or the U.S. Attorneys Office for the Eastern District of California at 916-554-2900.

    Media inquiries to the U.S. Attorney’s Office should be directed to Lauren Horwood at 916-554-2706. Media inquiries regarding the department’s Antitrust Division should be directed to Gina Talamona at 202-514-2007.

    This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force.

    President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

    One component of the FFETF is the national Mortgage Fraud Working Group, co-chaired by U.S. Attorney Wagner.

    Dan Edstrom
    dmedstrom@hotmail.com

  11. Department of Justice Press Release

    For Immediate Release
    April 16, 2010 United States Attorney’s Office
    Eastern District of California
    Contact: (916) 554-2700
    Stockton Real Estate Executive Pleads Guilty to Bid Rigging at Auctions of Foreclosed Properties

    SACRAMENTO, CA—United States Attorney Benjamin B. Wagner and Assistant Attorney General Christine Varney of the Department of Justice’s Antitrust Division announced today that Anthony B. Ghio, 43, of Stockton, pleaded guilty today before United States District Judge Edward J. Garcia to conspiring to rig bids at public real estate foreclosure auctions held in San Joaquin County.

    These charges arose from an ongoing federal antitrust investigation of fraud and bidding irregularities in certain real estate auctions in San Joaquin County. The investigation is being conducted by the U.S. Attorney’s Office for the Eastern District of California, the Antitrust Division’s San Francisco Office, the Federal Bureau of Investigation, and the San Joaquin County District Attorney’s Office.

    According to Assistant United States Attorneys Robin R. Taylor and Russell L. Carlberg, who are prosecuting the case with assistance from Barbara Nelson and Richard Cohen of the Antitrust Division, Ghio admitted in his guilty plea that he conspired with a group of real estate speculators who agreed not to bid against each other at certain public real estate foreclosure auctions in San Joaquin County. The primary purpose of the conspiracy was to suppress and restrain competition and obtain selected real estate offered at San Joaquin County public foreclosure auctions at noncompetitive prices.

    Court documents show that after the conspirators’ designated bidder bought a property at a public auction, they would hold a second private auction. Each participating conspirator would submit bids in the private auction above the public auction price. The conspirator who bid the highest amount at the end of the private auction won the property. The difference between the noncompetitive price at the public auction and the winning bid at the second auction was the group’s illicit profit, and it was divided among the conspirators in payoffs. Ghio participated in the bid-rigging scheme from April 2009 until October 2009.

    Ghio is charged with bid rigging, a violation of the Sherman Act, which carries a maximum penalty of 10 years in prison and a $1 million fine. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by the victim of the crime, if either of those amounts is greater than the statutory maximum fine. The actual sentence, however, will be determined at the discretion of the court after consideration of any applicable statutory sentencing factors and the Federal Sentencing Guidelines, which take into account a number of variables.

    The investigation is continuing. Anyone with information concerning bid rigging or fraud related to real estate foreclosure auctions should contact the Antitrust Division’s San Francisco Office at 415-436-6660 or visit http://www.justice.gov/atr/contact/newcase.htm, or the FBI’s Sacramento Division at 916-481-9110, or the U.S. Attorneys Office for the Eastern District of California at 916-554-2900.

    Media inquiries to the U.S. Attorney’s Office should be directed to Lauren Horwood at 916-554-2706. Media inquiries regarding the department’s Antitrust Division should be directed to Gina Talamona at 202-514-2007.

    This law enforcement action is part of President Barack Obama’s Financial Fraud Enforcement Task Force.

    President Obama established the interagency Financial Fraud Enforcement Task Force to wage an aggressive, coordinated, and proactive effort to investigate and prosecute financial crimes. The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

    One component of the FFETF is the national Mortgage Fraud Working Group, co-chaired by U.S. Attorney Wagner.

    Dan Edstrom
    dmedstrom@hotmail.com

Leave a Reply

%d bloggers like this: