Notarize This: The Brewing Foreclosure StormBY JENNIFER BRUNNER OHIO SECRETARY OF STATE
In just 12 years these pressure fronts are about to erupt because of something as simple as how documents are notarized. I am reminded of the fact Timothy McVey was apprehended, not because he robbed a bank, but because the tags on his car were expired. One thing leads to another, and what unfolds is the discovery of something so fundamentally wrong that it can’t be ignored.
Ever wonder why President Obama brought into the White House financial advisors who seemed to have come from the thick of financial practices we were trying to shed? That’s because our home mortgage financial transactions and what happens to the paperwork after we sign it have become so complicated, it took people who knew the system to clip the right wires so the bomb didn’t detonate.
I’m from Ohio, where home mortgage foreclosure rates remain among the highest in the nation. My parents grew up in a rural Ohio town so small that the town residents today still go to the post office for their mail. What I learned from my parents was to be honest and work hard. We were taught, like many others, to respect authority, play by the rules, only take what is yours, be kind, treat others with respect and stand up for what is right.
That’s not what American consumers have gotten from today’s lending industry. Since the repeal of Glass Steagall, the creation and trading of mortgage-backed securities have become a norm, enjoying less regulatory oversight than for traditional securities trading. Mortgages now became parts of “tranches,” a French word for “pieces,” that back securities sold. Mortgage notes, which must to be recorded to become a lien on real estate are now, through a sleight of hand, secondary to the interests of the mortgage backed securities traders with the advent of Mortgage Electronic Registration Services, Inc. (MERS) which facilitates trading without recording the changing ownership interests in mortgages. Local governments lose revenue from recording those changing interests, and the original note often becomes lost in the brisk shuffle of trading and reassigning them to various tranches that back purchases of them from all over the world.
Most mortgages are sold by the original lender within weeks of a home closing. The lender gets funds for selling the mortgage (often selling to taxpayer backed Fannie Mae or Freddie Mac) and is flush to lend again. If you play it out in your mind, you can see why the housing “bubble” that developed finally burst and is slow to come back–more and more people were told they could afford homes they couldn’t, and more and more people made money at each step of the way from the appraisal to the sale of a home to the sale of the mortgage to open trading of the mortgage as backing for a myriad of securities configurations.
What happens when the homeowner can’t pay the mortgage anymore–because of job loss, medical expenses or excessive credit card and other debt? Foreclosure. But in Ohio a court has to grant it. In a lawsuit for foreclosure, documents are presented to a court to decide if the homeowner is in default and by how much. The lawsuit is supposed to be brought by the person or institution who holds the note for the mortgage being foreclosed. If ownership of the note has passed through many hands, a “chain of title” must be established to prove that the person who claims rights to foreclose on the home is the person actually owed money on the mortgage. Once the court grants foreclosure, the court can then order sale of the home and eviction of its owners.
Under today’s financial schemes, foreclosure documents are routinely created to demonstrate the transfer of the interest in the note so the right person brings the foreclosure lawsuit. In the case of Chase Home Finance, LLC, its Columbus, Ohio employee, Beth Cottrell, testified in her deposition that she helps create foreclosure documents by signing on behalf of the banks and financial institutions (including MERS) that have been involved. Then, a small group of notaries at Chase notarize her and others’ signatures on various foreclosure documents (about 18,000 documents a month at Chase Home Finance, LLC).
While serving as a Chase Home Finance, LLC employee, Beth Cottrell’s name has appeared in foreclosure affidavits from 2008 through 2010 in the Florida court system on documents showing mortgage amounts owed on behalf of Wells Fargo, U.S. Bank, Federal National Mortgage Association, HSBC, Deutsche Bank, People’s Choice Home Loan, Wachovia and Citi, even though she was an employee of Chase Home Finance, LLC in Columbus.
In Ohio, I read two depositions of Beth Cottrell taken in Columbus, Ohio in May of this year, about a Florida foreclosure. I was frankly chagrined to read her description of the notary activity to process the 18,000 documents a month by the company she works for alone–using just eight notaries. In her deposition, Ms. Cottrell’s stated that: no oath is administered for the signing of each document; notaries (not signers) are filling in numbers in the affidavits used in court ordered foreclosures; notarized documents are not verified by the person signing them, but rather, signers are relying on verification by others, and notaries know this at the time they notarize documents; and large numbers of documents are signed in bulk and notarized in bulk separately.
As Secretary of State of Ohio, I license Ohio’s notaries. My state’s notary laws, like those of many states, don’t give me the tools to address the notary problems found in the changing circumstances in mortgage financing. In Ohio, even though I grant notary commissions, I don’t have the power to investigate or prosecute when there is suspected wrongdoing. That’s why I asked the Department of Justice to review and investigate.
The seal, date and signature of a notary public are there to bolster the reliability and integrity of a document, especially one that allows a court to order the taking of someone’s home. In the situations I have brought to the DOJ’s attention, something is clearly amiss.
Corporations, like consumers, must follow the same rules for transferring property as we would if we sold our house to our child or neighbor. The notary process is necessary in preparing the documents required to foreclose. The notary process must not be abused or bypassed when convincing a court to foreclose on a mortgage, evict its inhabitants and sell their home so that someone can recover money at the end of a long transaction of securities trading.
This is beginning to look like a storm that blew right into Oz.
Just as it took a dog named, “Toto” to pull back the curtain to see what was being perpetrated on Oz, maybe what some consider a minor detail, like notarizing documents as the law requires, will help the Dorothy’s of this day and age have a home to go to.
More information on the referral to the Department of Justice can be found here.
Follow Jennifer Brunner on Twitter: www.twitter.com/JenniferBrunner
Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud |
Hello! I’ve been reading your weblog for some time now and finally got the bravery to go ahead and give you a shout out from Dallas Texas! Just wanted to say keep up the good job!
Wow that was strange. I just wrote an really long comment but after I clicked submit my comment didn’t appear. Grrrr… well I’m not writing all that over again. Anyways, just wanted to say wonderful blog!
Dam what an idiot I am. As quickly as I lost my job I put the home available on the market so I would not fall behind. It took me virtually a 12 months and the lack of about $200,000 in equity but I sold it before missing a single payment. Now I’m renting another person’s home with the rapidly diminishing proceeds that I did handle to get. If only I had employed an Acorn lawyer instead!
http://www.scribd.com/doc/38783477/Congressional-Letter-to-Investigate-Banks-Final-10-4-10-OCC-BERANKE-HOLDER-WALSH-ATTORNEY-GENERAL-TOLD-TO-INVESTI
Well at least Ms. Brunner understands and has articulated her “constitutional obligations to the people” in the position she is mandated to uphold when notaries are “awarded” a “commission” to uphold the law and legal obligations bestowed upon them by a Secretary of State. Next then is the County Clerk… who actually swears them(notaries) in… and who also oversee the “proper recording” of documents in the public record… now there is a story yet to be told
Action Alert – Please tell President Obama NOT to sign the Interstate Recognition of Notarizations Act: http://wp.me/pFWnq-35N
this was posted by
Jennifer Brunner
Ohio Secretary of State
President Obama was presented with HR. 3808 on Thursday, September 30, 2010. As of today, he has not signed the bill. Please join me in urging him not to sign the bill by sending an email or calling the White House at 202-456-1111.
Mortgages are now being used as backing for securities traded all over the world by financial institutions. When a mortgage goes into default, a “chain of title” (list of its owners) must be created. It’s being discovered that many financial institutions have taken shortcuts in creating lawful chains of title that allow them to foreclose and take homes when they would not otherwise have the right under the law.
Banks demand we follow every letter of their contracts We must demand they follow the law. It’s that simple. Please join me in urging President Obama not to sign the bill by sending an email or calling 202-456-1111.
Thanks for working together,
Jennifer Brunner
Ohio Secretary of State
ANONYMOUS
“How Mr. Henry Paulson, Mr. Bernancke, Mr. Geithner, could have ever allowed victims to continue to be defrauded by foreclosure fraud ”
Hiding how they ALL profited from the very scam “THEY promoted ” is how.
They knew on the way in, they knew while, they are now scared to death of how the real scam & their complicity to it will be revealed , “IF”- it is ever truly revealed.
Our solution “was” to perpetuate
“What we should have learned from our parents was to be honest and work hard, to respect authority, play by the rules, only take what is yours, be kind, treat others with respect and stand up for what is right.”
The grim reality is we are rapidly failing as a “society” of intelligent beings.
Freud and of course his cousin ” Edward Bernays” saw and exploited for profit & control the misunderstood subconscious of “people”.
“Greed as an emotion”
Anonymous,
I am so glad that you agree with Jennifer Brunner … GREAT info! Also, when are you going to divulge who you are?
FYI – we are coming up on 72 months since our last mortgage payment.
Anonymous,
Very cogent thoughts. I too amd glad you’re on our side, and that you continue to refine these issues.
Thanks
Anon,
The answer that is clear to me is that congress and presidents are controlled by the international banking cartel.
The American revolution was fought when cartel ordered the King of England to remove the colonist’s scrip under which the the country was thriving. It wasn’t over a tax on tea.
Lincoln, Garfield and Kennedy were assassinated and all three had done something to restore the money creation powers of the constitution.
Jackson was the most successful President who ended the foreign control of money for seventy some odd years until Wilson caved in to the bankers again.
But Wilson is reported as have said this before he died:
“I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated governments in the civilized world – no longer a government by free opinion, no longer a government by conviction and the vote of the majority, but a government by the opinion and duress of a small group of dominant men.”
http://www.scribd.com/doc/38755799/Kentucky-LPS-Class-Action-Complaint-NICK-WOOTEN-STOCK-LPS-DROPS-TO-NEW-LOW
LPS DEFAULT CLASS ACTION–STOCK AT NEW RECENT LOWS. GOOD.
BSE
Yeah, but notary has to be present at signing. Judge Schack once questioned how a document could be signed and notarized – at the same time – on both the east and west coast.
You know, insiders have told me that the problems cannot be fixed because no one knows where the mortgage loans are. Do not believe that for a minute – they know who will get any foreclosure recovery proceeds. All has been a cover-up – and for too long.
The goal from onset has been to clear the market of foreclosures – as quickly as possible. Once this was achieved, they assumed all would then return to normal – do it all over again!!
They did not factor in Neil, this blog, and you – and everyone else here – speaking out. Glad we are all on each others side.
One point to note as what the evil doers will claim, “The notary only is there to witness a signature. Not the content”.
ANONYMOUS
Glad you are on my side.
Zinger
Do not call out only to Arizona “readers”. Much was done in Arizona – even if you did not live there.
Jennifer Brunner:
Great information for the people. You are absolutely correct – repeal of the Glass-Steagall Act was a source of much of today’s fraud. Senator Phil Gramm, later, was the grandfather of derivative deregulation. Oh those derivatives – that is how attorneys claims to be “related” to the original trust – even though loans are long removed.
And, as I am sure Jennifer knows, the Glass-Steagall Act separated investment banking from commercial banking. Once the Act was repealed – banks had the leeway to both lend you money – and securitize the loans. This not only included mortgage loans – but also credit card debt. Banks, therefore, knew everything about you – your credit card debt, your home value, and everything else “shared” by affiliate networks.
You were targeted. Nothing happened by accident. By repeal of Glass-Steagall – banks were able to lend you money (credit card) at high interest rates – securitize that debt, then give you a mortgage at also high rates – to pay the credit card debt – they had already lent you at high rates. Who the heck invented FICO? Then they would securitize your mortgage loan – and take your home if you could not pay the high rates.
By repeal of the Glass Steagall Act – the banks were able to solicit both commercial lending – and securitize the receivables. A conflict – that was once outlawed by this country.
And, the banks knew everything about you – they shared information – they solicited you – they knew their source of revenue – YOU. They did all this without the blink of an eye as to fraud – they did not care. They were making big bucks – for themselves – and for their investors. They justified all – by labeling the targeted people as “deadbeats” – not worthy of contribution to economic goals – or society.
Congress approved all – they were controlled. Neither Bush nor Clinton stood up to the scam – and President Obama is just following suit.
None of what is happening is good for America. How Mr. Henry Paulson, Mr. Bernancke, Mr. Geithner, could have ever allowed victims to continue to be defrauded by foreclosure fraud is beyond me.
One of the arguments some present is – “well, if we help these people – then all will default because they will want a hand-out too”. But, this is ridiculous. Not all of Americans were scammed – if you were not a target – you were not scammed. If you have clear mortgage title, a great credit score, earn substantial income – you ARE NOT A VICTIM.
This is about predatory lending – FRAUD – and targeted victims.
Said it before – and will say it again. Glass-Steagall was repealed for a reason. Congress had already given away American jobs – and created a consumer-oriented economy. The only source of real profit to US economy was via the financial institutions – who were allowed to target the American public. And, target the one major asset that remained in America – the home. Glass-Steagall repeal allowed banks to – GO FOR IT. Congress stood by – watched it – and did nothing. Today, who but Mr. Grayson, is standing up for what has been done to the people?? Can you believe Congress even voted against bankruptcy reform – allowing people to write off part of loan that is under-water??? Twice – this was rejected. What are these guys/gals doing? What are they thinking?
Eventually, in American history, injustices – and we all know these injustices – are eventually exposed, but, in the interim, numerous parties have been – and will – suffer.
We are not deadbeats, we are part of society, we will no longer be victims. And, the “interim” is over.
Thank you, Jennifer. Well written.
We have been issuing complaints to appropriate places when we see notary fraud as well as the signature fraud wew have seen. The truth is if you can discredit the notary the work they did has to be undone.
To me it is like when my kids climbed to high in the tree, I made them come down by reversing the steps they took to climb the tree… worked most of the time.
I do have a call to action for any ARizona readers.
OBAMA IS DOING IT BECAUSE HE WANTS TO GET REELECTED AND HE DOES NOT WANT TO LOSE THE CONGRESS BY TOO BIG OF A MARGIN
WHO CARES HOW WE GET IT. WE NEED TO MOVE SWIFTLY
Obama people have made hefty profits off the mortgage crisis.
Geithner and volker were both very involved witht the “other” team.
To insinuate that these people had anyones interest at heart other than their own is a diservice to this entire community.