EDITOR’S NOTE: LISTEN UP! It’s easy to pass over these reports with the thought that it merely points out chicanery you already knew was about. But this one confirms what I’ve been saying for three years. The best defense against any claim is to show payment. Normally if someone pays off your debt it is either a gift (hence the defense of payment, even if it wasn’t by you) or they were buying the debt, which means that the deal was they were subrogated in the claim.

In other words if AIG gave Goldman Sachs money for “losses” on loan pools, the insurer would normally have the right to collect on the debts that were paid. OR they would have the right to receive money back if they paid for a loss claim where there was in fact no loss.

But that step was both skipped and waived. First of all, the payoff from AIG was never allocated specifically to a loan pool in violation of the express terms of the contracts with the investors who advanced the funds.

Second, the “Trustee” or manager of the pool never allocated the payment in any manner to the loans that were failing. Since most of the loans that were failing were the worst loans that would have made them a lot more valuable. In fact, for the investment banks that are buying up the toxic waste tranches, their end game might well be exactly that — to allocate the payments received from third party insurers and counter-parties on hedge contracts etc. and thus raise the value of the “toxic” pools considerably AFTER they have screwed all the investors and the borrowers.

The plain truth is that in the co-venture antics that were going on, the recipients of insurance, bailout, hedge, and other credit enhancements were acting at all times as either agents or constructive trustees for the investors. The fact that they received payment and failed to give that money to the investors is a case “between the creditors” as some judges like to say. But it also is a reduction in the amount owed to the investor from the pool (via the mortgage backed securities the investor bought).

If the reduction in the balance owed to the investor is properly allocated then the loans in the pool are no longer backing the full amount owed to the investor — they are backing something less. Now if AIG bought the loan, the borrower would still owe the money, this time to AIG. But AIG didn’t buy the loan, the pool, or anything for that matter. AIG merely paid out on an insurance contract under a deal where they, for their own reasons, specifically waived any claims for refund and under which they had no rights of substitution (subrogation) in the claims.

In plain terms, if you wreck your car and the insurance company adjusts it as a total wreck then they pay you off and take what is left of the car to mitigate their damages. What AIG did was pay the claim but they didn’t take the car, leaving you with the wreck to further mitigate your damages. It’s not a complete analogy but you get the point, right?

So back to AIG. Since they merely paid off the debt, the debt was reduced. The debt having been reduced it should have been reflected on the books of the investor or whoever is claiming to be the holder or enforcer of the loan obligation. It wasn’t. So the amount anyone claimed to be in default on any loans that were claimed to be in a pool (whether the loan actually made it into the pool or not) was and remains incorrectly stated. That means the notice of default, the notice of sale, the foreclosure suit are all wrong. In fact, when you add in all third party payments, as I have done in a number of cases, the obligation has been overpaid by factors of as much as 10 times the loan.

So we have a foreclosure on a home encumbered by a mortgage that has been satisfied because the OBLIGATION was satisfied. When the obligation was satisfied, the co-venturers here in securitization intentionally held onto the notes as though they were still due in full when they knew they had received multiple payments on them but since THEY were in charge of the bookkeeping, THEY didn’t reduce the loan balances.

Then THEY authorized some new entity to say they were the holder of the note, which they might be. But the note is evidence of the obligation, not the obligation itself.  If the obligation is paid, the holder of the note has only one action left — to give it back to the borrower marked PAID IN FULL.

June 29, 2010

In U.S. Bailout of A.I.G., Forgiveness for Big Banks


At the end of the American International Group’s annual meeting last month, a shareholder approached the microphone with a question for Robert Benmosche, the insurer’s chief executive.

“I’d like to know, what does A.I.G. plan to do with Goldman Sachs?” he asked. “Are you going to get — recoup — some of our money that was given to them?”

Mr. Benmosche, steward of an insurer brought to its knees two years ago after making too many risky, outsize financial bets and paying billions of dollars in claims to Goldman and other banks, said he would continue evaluating his legal options. But, in reality, A.I.G. has precious few.

When the government began rescuing it from collapse in the fall of 2008 with what has become a $182 billion lifeline, A.I.G. was required to forfeit its right to sue several banks — including Goldman, Société Générale, Deutsche Bank and Merrill Lynch — over any irregularities with most of the mortgage securities it insured in the precrisis years.

But after the Securities and Exchange Commission’s civil fraud suit filed in April against Goldman for possibly misrepresenting a mortgage deal to investors, A.I.G. executives and shareholders are asking whether A.I.G. may have been misled by Goldman into insuring mortgage deals that the bank and others may have known were flawed.

This month, an Australian hedge fund sued Goldman on similar grounds. Goldman is contesting the suit and denies any wrongdoing. A spokesman for A.I.G. declined to comment about any plans to sue Goldman or any other banks with which it worked. A Goldman spokesman said that his firm believed that “all aspects of our relationship with A.I.G. were appropriate.”

A Legal Waiver

Unknown outside of a few Wall Street legal departments, the A.I.G. waiver was released last month by the House Committee on Oversight and Government Reform amid 250,000 pages of largely undisclosed documents. The documents, reviewed by The New York Times, provide the most comprehensive public record of how the Federal Reserve Bank of New York and the Treasury Department orchestrated one of the biggest corporate bailouts in history.

The documents also indicate that regulators ignored recommendations from their own advisers to force the banks to accept losses on their A.I.G. deals and instead paid the banks in full for the contracts. That decision, say critics of the A.I.G. bailout, has cost taxpayers billions of extra dollars in payments to the banks. It also contrasts with the hard line the White House took in 2009 when it forced Chrysler’s lenders to take losses when the government bailed out the auto giant.

As a Congressional commission convenes hearings Wednesday exploring the A.I.G. bailout and Goldman’s relationship with the insurer, analysts say that the documents suggest that regulators were overly punitive toward A.I.G. and overly forgiving of banks during the bailout — signified, they say, by the fact that the legal waiver undermined A.I.G. and its shareholders’ ability to recover damages.

“Even if it turns out that it would be a hard suit to win, just the gesture of requiring A.I.G. to scrap its ability to sue is outrageous,” said David Skeel, a law professor at the University of Pennsylvania. “The defense may be that the banking system was in trouble, and we couldn’t afford to destabilize it anymore, but that just strikes me as really going overboard.”

“This really suggests they had myopia and they were looking at it entirely through the perspective of the banks,” Mr. Skeel said.

Regulators at the New York Fed declined to comment on the legal waiver but disagreed with that viewpoint.

“This was not about the banks,” said Sarah J. Dahlgren, a senior vice president for the New York Fed who oversees A.I.G. “This was about stabilizing the system by preventing the disorderly collapse of A.I.G. and the potentially devastating consequences of that event for the U.S. and global economies.”

This month, the Congressional Oversight Panel, a body charged with reviewing the state of financial markets and the regulators that monitor them, published a 337-page report on the A.I.G. bailout. It concluded that the Federal Reserve Bank of New York did not give enough consideration to alternatives before sinking more and more taxpayer money into A.I.G. “It is hard to escape the conclusion that F.R.B.N.Y. was just ‘going through the motions,’ ” the report said.

About $46 billion of the taxpayer money in the A.I.G. bailout was used to pay to mortgage trading partners like Goldman and Société Générale, a French bank, to make good on their claims. The banks are not expected to return any of that money, leading the Congressional Research Service to say in March that much of the taxpayer money ultimately bailed out the banks, not A.I.G.

A Goldman spokesman said that he did not agree with that report’s assertion, noting that his firm considered itself to be insulated from possible losses on its A.I.G. deals.

Even with the financial reform legislation that Congress introduced last week, David A. Moss, a Harvard Business School professor, said he was concerned that the government had not developed a blueprint for stabilizing markets when huge companies like A.I.G. run aground and, for that reason, regulators’ actions during the financial crisis need continued scrutiny. “We have to vet these things now because otherwise, if we face a similar crisis again, federal officials are likely to follow precedents set this time around,” he said.

Under the new legislation, the Federal Deposit Insurance Corporation will have the power to untangle the financial affairs of troubled entities, but bailed-out companies will pay most of their trading partners 100 cents on the dollar for outstanding contracts. (In some cases, the government will be able to recoup some of those payments later on, which the Treasury Department says will protect taxpayers’ interest. )

Sheila C. Bair, the chairwoman of the F.D.I.C., has said that trading partners should be forced to accept discounts in the middle of a bailout.

Regardless of the financial parameters of bailouts, analysts also say that real financial reform should require regulators to demonstrate much more independence from the firms they monitor.

In that regard, the newly released Congressional documents show New York Fed officials deferring to bank executives at a time when the government was pumping hundreds of billions of taxpayer dollars into the financial system to rescue bankers from their own mistakes. While Wall Street deal-making is famously hard-nosed with participants fighting for every penny, during the A.I.G. bailout regulators negotiated with the banks in an almost conciliatory fashion.

On Nov. 6, 2008, for instance, after a New York Fed official spoke with Lloyd C. Blankfein, Goldman’s chief executive, about the Fed’s A.I.G. plans, the official noted in an e-mail message to Mr. Blankfein that he appreciated the Wall Street titan’s patience. “Thanks for understanding,” the regulator said.

From the moment the government agreed to lend A.I.G. $85 billion on Sept. 16, 2008, the New York Fed, led at the time by Timothy F. Geithner, and its outside advisers all acknowledged that a rescue had to achieve two goals: stop the bleeding at A.I.G. and protect the taxpayer money the government poured into the insurer.

One of the regulators’ most controversial decisions was awarding the banks that were A.I.G.’s trading partners 100 cents on the dollar to unwind debt insurance they had bought from the firm. Critics have questioned why the government did not try to wring more concessions from the banks, which would have saved taxpayers billions of dollars.

Mr. Geithner, who is now the Treasury secretary, has repeatedly said that as steward of the New York Fed, he had no choice but to pay A.I.G.’s trading partners in full.

But two entirely different solutions to A.I.G.’s problems were presented to Fed officials by three of its outside advisers, according to the documents. Under those plans, the banks would have had to accept what the advisers described as “deep concessions” of as much as about 10 percent on their contracts or they might have had to return about $30 billion that A.I.G. had paid them before the bailout.

Had either of these plans been implemented, A.I.G. may have been left in a far better financial position than it is today, with taxpayers at less risk and banks forced to swallow bigger losses.

A spokesman for Mr. Geithner, Andrew Williams, said it was easy to speculate about how the A.I.G. bailout might have been handled differently, but the government had limited tools.

“At that perilous moment, actions were chosen that would have the greatest likelihood of protecting American families and businesses from a catastrophic failure of another financial firm and an accelerating panic,” Mr. Williams said.

For its part, the Treasury appeared to be opposed to any options that did not involve making the banks whole on their A.I.G. contracts. At Treasury, a former Goldman executive, Dan H. Jester, was the agency’s point man on the A.I.G. bailout. Mr. Jester had worked at Goldman with Henry M. Paulson Jr., the Treasury secretary during the A.I.G. bailout. Mr. Paulson previously served as Goldman’s chief executive before joining the government.

A Close Association

Mr. Jester, according to several people with knowledge of his financial holdings, still owned Goldman stock while overseeing Treasury’s response to the A.I.G. crisis. According to the documents, Mr. Jester opposed bailout structures that required the banks to return cash to A.I.G. Nothing in the documents indicates that Mr. Jester advocated forcing Goldman and the other banks to accept a discount on the deals.

Although the value of Goldman’s shares could have been affected by the terms of the A.I.G. bailout, Mr. Jester was not required to publicly disclose his stock holdings because he was hired as an outside contractor, a job title at Treasury that allowed him to forgo disclosure rules applying to appointed officials. In late October 2008, he stopped overseeing A.I.G. after others were given that responsibility, according to Michele Davis, a spokeswoman for Mr. Jester.

Ms. Davis said that Mr. Jester fought hard to protect taxpayer money and followed an ethics plan to avoid conflict with all of his stock holdings. Ms. Davis is also a spokeswoman for Mr. Paulson, and said that he declined to comment for this article.

The alternative bailout plans that regulators considered came from three advisory firms that the New York Fed hired: Morgan Stanley, Black Rock, and Ernst & Young.

One plan envisioned the government guaranteeing A.I.G.’s obligations in various ways, in much the same way the F.D.I.C. backs personal savings accounts at banks facing runs by customers. On Oct. 15, Ms. Dahlgren wrote to Mr. Geithner that the Federal Reserve board in Washington had said the New York Fed should try to get Treasury to do a guarantee. “We think this is something we need to have in our back pockets,” she wrote.

Treasury had the authority to issue a guarantee but was unwilling to do so because that would use up bailout funds. Once the guarantee was off the table, Fed officials focused on possibly buying the distressed securities insured by A.I.G. From the start, the Fed and its advisers prepared for the banks to accept discounts. A BlackRock presentation outlined five reasons why the banks should agree to such concessions, all of which revolved around the many financial benefits they would receive. BlackRock and Morgan Stanley presented a number of options, including what BlackRock called a “deep concession” in which banks would return $6.4 billion A.I.G. paid them before the bailout.

The three banks with the most to lose under these options were Société Générale, Deutsche Bank and Goldman Sachs. Société Générale would have had to give up $322 million to $2.1 billion depending on which alternative was used; Deutsche Bank would have had to forgo $40 million to $1.1 billion, while Goldman would have had to give up $271 million to $892 million, according to the documents.

Société Générale and Deutsche Bank both declined to comment.

Ultimately, the New York Fed never forced the banks to make concessions. Thomas C. Baxter Jr., general counsel at the New York Fed, explained that a looming downgrade of A.I.G. by the credit rating agencies on Nov. 10 forced the regulator to move quickly to avoid a default, which would have unleashed “catastrophic systemic consequences for our economy.”

“We avoided that horrible result, got the job done in the time available, and the Fed will eventually get out of this rescue whole,” he said in an interview.

And yet two Fed governors in Washington were concerned that making the banks whole on the A.I.G. contracts would be “a gift,” according to the documents.

Gift or not, the banks got 100 cents on the dollar. And on Nov. 11, 2008, a New York Fed staff member recommended that documents for explaining the bailout to the public not mention bank concessions. The Fed should not reveal that it didn’t secure concessions “unless absolutely necessary,” the staff member advised. In the end, the Fed successfully kept most of the details about its negotiations with banks confidential for more than a year, despite opposition from the media and Congress.

During the A.I.G. bailout, New York Fed officials prepared a script for its employees to use in negotiations with the banks and it was anything but tough; it advised Fed negotiators to solicit suggestions from bankers about what financial and institutional support they wanted from the Fed. The script also reminded government negotiators that bank participation was “entirely voluntary.”

The New York Fed appointed Terrence J. Checki as its point man with the banks. In e-mail messages that November, he was deferential to bankers, including the e-mail message in which he thanked Mr. Blankfein for his patience.

Many Thank-Yous

After UBS, a Swiss bank, received details about the Fed’s 100-cents-on-the-dollar proposal, Mr. Checki thanked Robert Wolf, a UBS executive, for his patience as well. “Thank you for your responsiveness and cooperation,” he said in an e-mail message. “Hope the benign outcome helped offset any aggravation. Thank you again.”

The Congressional Oversight Panel, which interviewed A.I.G.’s trading partners about how tough the government was during the negotiations, concluded that many of the governments efforts were merely “desultory attempts.”

All of this was quite different from the tack the government took in the Chrysler bailout. In that matter, the government told banks they could take losses on their loans or simply own a bankrupt company; the banks took the losses.

During the A.I.G. bailout, the Fed seemed more focused on extracting concessions from A.I.G. than from the banks. Mr. Baxter, in an interview, conceded that the way that the New York Fed handled the negotiations meant that any resulting deal “took most of the upside potential away from A.I.G.”

The legal waiver barring A.I.G. from suing the banks was not in the original document that regulators circulated on Nov. 6, 2008 to dissolve the insurer’s contracts with the banks. A day later a waiver was added but the Congressional documents show no e-mail traffic explaining why that occurred or who was responsible for inserting it. The New York Fed declined to comment.

Policy experts say it is not unusual for parties to waive legal rights when public money is involved. Mr. Moss, the Harvard professor, said the government might have been concerned that the insurer would use taxpayer money to sue banks. “The question is: was this legitimate?” he asked. “The answer depends on the motivation. If the reason was to avoid a slew of lawsuits that could have further destabilized the financial system in the short term, this may have been reasonable.”

But two people with direct knowledge of the negotiations between A.I.G. and the banks, who requested anonymity because the talks were confidential, said the legal waiver was not a routine matter — and that federal regulators forced the insurer to accept it.

Even if the waiver was warranted, experts say it unfairly handcuffed A.I.G. and has undermined the financial interests of taxpayers. If, for example, the banks misled A.I.G. about the mortgage securities A.I.G. insured, taxpayer money could be recouped from the banks through lawsuits.

Unless A.I.G. can prove it signed the legal waiver under duress, it cannot sue to recover claims it paid on $62 billion of about $76 billion of mortgage securities that it insured. (A.I.G. retains the right to sue on about $14 billion of the mortgage securities that it insured.)

If A.I.G. had the right to sue, and if banks were found to have misrepresented the deals or used improper valuations on securities A.I.G. insured to extract heftier payouts from the firm, the insurer’s claims could yield tens of billions of dollars in damages because of its shareholders’ lost market value, according to Mr. Skeel.

A.I.G. still has the right to sue in connection with exotic securities it insured called “synthetic collateralized debt obligations,” which are known as C.D.O.’s. Such instruments do not contain actual bonds, which is why they were not accepted as collateral by the Fed.

A.I.G. had insured $14 billion of synthetic C.D.O.’s,, including seven Goldman deals known as Abacus. One of the Abacus deals is the subject of the S.E.C.’s suit against Goldman. A.I.G. did not insure that security, but A.I.G.’s deals with Goldman are similar to the one in the S.E.C. case.

Throughout the A.I.G. bailout, as Congressional leaders and the media pressed for greater disclosure, regulators fought fiercely for confidentiality.

Even after the New York Fed released a list of the banks made whole in the bailout, it continued to resist disclosing information about the actual bonds in the deals, including codes known as “cusips” that label securities. “We need to fight hard to keep the cusips confidential,” one New York Fed official wroteon March 12, 2009.

Regulators said they wanted confidentiality because they did not want investors trading against the government’s portfolio. Others dispute that, saying that Wall Street insiders already knew what bonds were in the portfolio. Only the public was left in the dark.

“The New York Fed recognizes the public’s interest in transparency and has over time made more information available about the A.I.G. transactions,” a Fed spokesman said about the matter.

It was not until a Congressional committee issued a subpoena in January that the New York Fed finally turned over more comprehensive records. The bulk remained private until May, when some committee staff members put them online, saying they lacked the resources to review them all.

15 Responses

  1. If you have insurance, you are eligible to receive up to the maximum insurable amount stated in your insurance policy. Unfortunately, insurance companies try to save money on your own when possible, so the collection of insurance after an accident has occurred can be stressful.
    I hope you have been monitoring the maintenance of your vehicle, if so, please send copies of insurance company records maintenance.
    If after providing such evidence, the insurance company does not cooperate, you may consider useful research papers written about property damage and insurance claims.

  2. Anonymous, regarding your point 3 “However, the real party must follow the law. The real party cannot be remain undisclosed. The real creditor must be divulged.”

    Do you have a good citation for code that requires that the servicer/debt collection divulge the true and current creditor?

    In FDCPA I can only find reference to “original creditor.”

  3. Usedkarguy, Thanks for the info

  4. usedkarguy

    Yeah – searching Maiden Lane is good. But, it will only tell you what “toxic” tranches the government took off the books of the banks that held them. These are the tranches that were NOT paid by the swap protection.

    My point is that if the upper tranches were paid via swap protection, then the bottom tranches – held by the government (Maiden Lane) are simply worthless tranches. This is because the pass-through tranche structure has been paid and is no longer existent.

    Lower tranches are only paid current payout – if – and only if – the upper tranches have been paid. But, this payment must be current. If a swap payout has occurred, the upper tranches are NO LONGER current. They are done – there is nothing left for for the subordinate tranches to receive. Purchasing worthless toxic assets, by the government, was only a ploy to aid the financial institutions that held worthless “toxic” assets – that are no longer part of the originated “waterfall” structure payout. Worthless assets from a dissolved and dismantled Trust.

    You must remember, the REMICs were set up for current pass through of receivables ONLY. Nothing more. Foreclosures cannot be assigned to REMICs with knowledge of default.

    My anger is – the government knows this – and what the heck are they doing? They claim to be promoting modifications – and at the same time – are the investor in the toxic securities that are dead. Thus, ironically, the government is the one denying a loan modification and/or principal reduction – and, forcing foreclosure – despite their own law – including the 2009 TILA Amendment and .Federal Reserve Interim Opinion.

    But, listen to Mr. Ben Bernanke – he wants short sales. This is their goal. And, for anyone who knows of someone purchasing a new home – ask them their terms – ask them the size of their mortgage, ask them their down payment. These people are going to be in trouble. All is simply a transfer of wealth of from you – to them (new home buyers). I cannot figure out how this ever came to be – except politics in the worst possible way.

    Go figure why.

  5. Mark, if yu know the name of the trust (Registrant) download the Maiden Lane 1. II, III pdf.’s and search for your certificates as bonds or credit default swaps.

  6. Think the approach is somewhat off track.

    One – in response to — “investment banks that are buying up the toxic waste tranches, ” —–investment banks are not buying up toxic tranches -they are consolidating these tranches onto their balance sheets -and writing them off the former receivable pass-through.

    Two – we do not know what AIG (or other insurers) were entitled to once they honored the swap protection contract (they actually did not honor – the US Government did) – this information is not available. AIG could be entitled to whole loan collection rights. But, AIG “Obligations” are now owned by the US Government – who, by the way, is the party rejecting loan modifications – despite their law to promote them.

    Three – paying an obligation for another party does not release action against the borrower. The debt remains. However, the real party must follow the law. The real party cannot be remain undisclosed. The real creditor must be divulged. And, any failure to disclose the real and current creditor deprives the borrower of the right to a modification negotiation with the actual creditor. We all know, by know, servicers are not the creditor.

    Four- Use the paid “tranches” as evidence that the structure of the REMIC – as once originated (by cut-off date – ha ha) – is gone. Mezzanine tranche holders are only paid – if there is anything left after the A tranches holders are paid. And, this is ONLY for current pass-through. If the A tranches have been paid – in full- by swaps -there is nothing left to be paid to any M tranche holders. The “waterfall” structure is gone – thus, so is the pass-through REMIC that once organized the structured tranches.

    Five – Balance sheet accounting is critical – who is accounting for the right to collect the loan? That is the fundamental question.

    Six – As to “holder” of the note – there have been good challenges to the negotiability of the note posted here (see Collete McDonald). and post re- Professor at Pepperdine.

    If you try to challenge strictly on fact that someone else “paid” the loan amount for you – you will not win. This has already been tested in debt collection. It will not work. But, this is greater than “debt” collection – as the current creditor is supposing to be negotiating with you according to Congressional law. You need to know your creditor – until you find that out – the foreclosure is a farce and and a fraud – upon you – and upon the court.

    Finally, as Neil has stated many times, trying to get a complete discharge or “free home” will not work. Thus, trying to say the DEBT does not exist – will not hold. Only way you can possibly go this route is to claim that the account does not belong to you. And, that could be a focus – when a loan number has been changed (need less to say – your new loan number is not in the PSA “attached” “Mortgage Schedule.”

    And, as PJ has also said – principal reduction is the key. There needs to be principal reduction with a fair interest rate.

    Judges will not like hearing that the debt has been paid – and, therefore, you owe nothing. Need to shatter their “trustee” bogus Trust structure – and demand to know the current creditor. And, pursue counter-claims for a fraudulent foreclosure and fraud upon the court.

    TO quote trespass unwanted,
    I know nothing, and if I think I know something I know nothing. I don’t give legal advice because I don’t know legal things.

  7. How do I go about finding out if AIG paid out my mortgage loan, to either Wells Fargo , US Bank National Association, or Lehman Brothers Holding Co,

  8. Judge: Thank you, that is a nice theory but where is the proof and evidence that the obligation does not exist or has been paid off or has been charged off?

  9. now hearings on C Span

  10. –>> Treasonous Outrage <<–

    So the lenders commit INSURANCE FRAUD and the FBI does nothing but follow eternal paper-trails to nowhere pretending they are doing something about it and prosecuting a few bottom-feeders along the way to give at least an appearance…?

    By Countrywide's own admission they sold 142-billion dollars worth of mortgages to borrowers that they KNEW could not repay. Using CW's own statistical data – that equates to 965-thousand mortgage loans. By CW's own admission they used deceptive tactics – hid the facts from those borrowers so they would not have known it – thus those loans are "illegal" by any standard…

    Yet – CW is foreclosing on those same families because they have no idea they were given illegal loans that they could never afford. Per the mortgage notes – CW collects the mortgage insurance – then per the PSAs CW then collects the default ins, additional mortgage ins, securities ins, speacial hazard ins, etc – foreclose on the families tossing them into the street – THEN spin up new corporations to BUY UP the foreclosed homes – and start the process all over again…

    How long – how long will this be tolerated…? How many McVeigh U-Haulers will it take..?

    AIG should be prosecuting these lenders for insurance fraud but why would they if the Fed Gov is willing to bail them out. That way they can continue their scam and keep it under the radar… All they are doing is draining every last bit of blood from the people they can get – but ONE DAY the same will exacted from them BY THOSE SAME PEOPLE…

    The consequences for their actions must be of equal consequence – the CEOs – of these lenders should have everything they own taken – let them live in section-8 housing projects – let their kids go to the same public schools as they are doing to so many American families…

    THE CAR ACCIDENT was NOT an ACCIDENT – it was PLANNED… Last time I checked – it was illegal… so where are the arrest warrants…?

  11. How do we get the courts to acknowledge that the obligation no longer exists?

  12. the cusips” that label securities. would allow the investors and others TRACK & SEE the value of the overrated securities hence a collapse in the stock market confidence & big boy profits . these cusips will not be seen until its too late to recoup or cause the market fall affecting the profit of those holding & trading this crap.
    “We need to fight hard to keep the cusips confidential”, yea we can see why !

  13. THE A MAN

    you would be off the hook …IF the insurance company [aig] failed to bring suit against you [ subrogation ] thus waived as Neil pointed out.
    BUT.. I have to wonder if the insurance is paid to named policy holder –
    1- book keeping may require the amount of payment be recorded against the debt…but if what was being sold & traded was debt payments ,does this derivative [ wrecked car ] still exist ? Is there no right for the beneficiary of the insurance have the right to SELL the wreck for what ever additional profit they can?

  14. The car analogy is indeed correct. The lender is paid, the insurer gets the “wrecked” car for salvage. The “totalled” mortgage is INDEED transferred as an “asset with diminished value”, probably between zero and ten cents. CDS certificates for my loan trust are in the Maiden Lane 1. Try and explain that one away, counselor!





Contribute to the discussion!

%d bloggers like this: