GOOD HANDS (ALLSTATE) SLAP COUNTRYWIDE (BOA) FOR $700 MILLION FRAUD

COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary COMBO Title and Securitization Search, Report, Documents, Analysis & Commentary

“Allstate alleges that between March 2005 and June 2007, as it was buying the securities, Countrywide “abandoned its underwriting standards, misrepresented crucial information about the underlying mortgage loans and concealed material facts” from the insurer, it said in a statement.”

EDITOR’S COMMENT: If the note does not describe the terms of the transaction, then it cannot be used as evidence of the obligation. If the mortgage instrument states that it secures the obligation described in the note and the note describes a non-existent agreement, the obligation is unsecured. The Lenders here clearly intended a different use of their money than what was executed by their agents. The borrowers clearly relied on the same misinformation that was given to the investors.

Thus there was no actual agreement between the lender and borrower. Hence the obligation is in equity, the claim for which belongs to the investors. The investors have chosen to seek relief against the agents because they do not want to adopt the deceptive lending practices of the agents who were acting outside the scope of their authority as clearly set forth in the prospectus and securitization documentation, none of which was disclosed to the borrowers. The agents, not content to have stolen the money of the investors, now seek to steal the equitable claim of the investors as well. AND the attorneys of these agents have successfully confused the courts as to the status and orientation of the parties.

In the end the bogus mortgage bonds were worthless and empty, and in the end the obligations of the borrowers are unsecured and subject to offset for damages in tort and contract.

This one will probably cause BOA to push CW into the ditch and seek bankruptcy protection from creditors. But it also signals again the unwillingness of the Lenders (i.e., the people who advanced the funds that were subsequently used to fund loans that were fraudulently documented as notes and mortgages) to accept the authenticity of the loans, notes, obligations or mortgages. They are saying in simple language “That is not what we gave you the money for.”And they are saying “this is not what you said it would be.”

THAT is why investors are not going after homeowners and that is why investors are stepping back from the entire foreclosure fracas. If they thought they could recover more money by going after the enforcement of the loans against homeowners or borrowers, they would do it. But they don’t think that at all. Why not? Because the mortgages, the notes, the obligations are all unenforceable or nearly so. And because the documentation of the so-called “Trust” makes it difficult for them to control the servicers who are bleeding the last ounce of money out of this mess.

Investors, the source of the cash, the only people who could be called lenders, don’t want any part of the “trustees” or servicers or anyone but the investment banks and the intermediary aggregators working with the the investment banks because those are the people who really knew what they were doing to both sides of the transaction.

So the investors are all saying the same thing: these mortgages were not originated using industry standard underwriting guidelines and rules. These mortgages were not what was described in the prospectus to investors nor the pooling and services agreement. They are saying that disclosure was both intentionally misleading and lacking essential facts that would have negated Allstate’s willingness to advance hundreds of millions of dollars by the purchase of what turned out to be bogus mortgage bonds.

Thus the investors are saying what you sold us was worthless or worth less than what was represented — exactly what we have been saying here for borrowers. The loans were and are worthless, unenforceable and the loan principal was never exceeded by the true value of the property. That is appraisal fraud, it was ratings fraud, and those are one and the same thing. That is why investors and borrowers should be coming at these perpetrators from both ends so that they are revealed as the intermediaries who stole from both sides and then ran out the back door taking another giant helping of money from the U.S. taxpayers.

Hence the conclusion that the trustees are not acting in the interests of the the investors because either there isn’t or never was any trust or because the real show isn’t being run by the trustees at all. The defendants in both the investor and the borrower lawsuits should be the the underwriters from Wall Street and the aggregators like Countrywide. Investors got the message. Now it’s time for the borrowers.

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Allstate Sues Countrywide Over Mortgage-Backed Securities

Published 12/29/2010

9 Responses

  1. […] This post was mentioned on Twitter by Theresa Bastron. Theresa Bastron said: GOOD HANDS (ALLSTATE) SLAP COUNTRYWIDE (BOA) FOR $700 MILLION FRAUD: http://t.co/bqv0TbH […]

  2. One would think the Investor’s would see the mortgage holders are really not their enemy, it’s the Mega Banks. The Investors are waking up to the fact they stand to lose “Big Time” when their Insurance claims are denied.

  3. Why this lawsuit Allstate v. Countrywide is so important is that Allstate is a mega insurance company that lost major money because of fraud and misrepresentation by Countrywide, BAC and BofA. What that means is the following: the court will take notice of what Allstate is saying, because Allstate has the power and deep pockets necessary to get attention.

    Allstate can also afford to buy the best in attorneys. Allstate also has the power and money to say the evil “F” word: Fraud. Hold on to your seats: more lawsuits by mega insurance companies are coming against the mega banks. The insurance companies can afford the hotshot lawyers, and they know the best place to be made whole again is from the mega banks, not homeowners. They now see the fraud and misrepresentation that ran amok in the mortgage mess and securitization process, and they are going to do something about it.

    The servicing companies are raping the homeowners, but debt collectors have been raping people for years, and they have not been put out of business. Do not let them get away with it. Fight for your home. It sometimes seems hopeless, but the hammer on the banks is coming. http://www.challengingforeclosure.com Sirak@challengingforeclosure.com

  4. None of this matters when courts just don’t give a $hit, refuse to uphold the law and ignore common sense. WE ARE ALL SLAVES NOW, SO BE SURE NOT TO UPSET OUR JUDICIAL MASTERS AND CORPORATE OWNERS.

  5. REQUEST FOR JUDICIAL NOTICE FILED CONCURRENTLY WITH THE ADVERSARY PROCEDURE, AND THE REQUEST FOR JUDICIAL NOTICE FOR THE LAND TITLE RECORDS.

    http://www.scribd.com/doc/46010991/REQUEST-FOR-JUDICIAL-NOTICE-LAND-TITLE-RECORDS-Davies-Rjn-12-27-10-a-f-Dec-by-Firth-Final

  6. REQUEST FOR JUDICIAL NOTICE OF THE SEC RECORDS FOR ADVERSARY. SEC PROSPECTUS, AND POOLING AND SERVICING AGREEMENT FILED CONCURRENTLY WITH THE ADVERSARY.

    http://www.scribd.com/doc/46010945/REQUEST-FOR-JUDICIAL-NOTICE-OF-THE-SEC-FILE-PROSPECTUS-AND-POOLING-AND-SERVICING-AGREEMENTSec-Rjn-Final-Exhibit-1-2

  7. ADVERSARY AGAINST DEUTSHE BANK NATIONAL TRUST COMPANY AS TRUSTEE.

    http://www.scribd.com/doc/46010873/Davies-Adversary-Complaint-Final-6pm-12-27-10-6pm

  8. CALIFORNIA SUPERIOR COURT 4TH AMENDED COMPLAINT. AGAINST ONEWEST, NDEX, UAMC, UAMCC, MERS. FRAUD, B&P CODE, WRONGFUL FORECLOSURE.FILED THE DAY AFTER THE ADVERSARY.\

    http://www.scribd.com/doc/46070331/Fourth-Amended-Complaint-DAVIES-V-NDEX-RIVERSIDE-SUPERIOR-COURT-UAMC-NDEX-ONEWEST-UAMCC-MERS

  9. Well, Well, Well. I hope more Investors feel the same and/or “get-a-grip” so we homeowners/borrowers can get this “road-on-the-show”

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