WHY I THINK THAT THE “LOANS” WERE ACTUALLY SECURITIES FALLING UNDER SEC REGULATION

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

SEE CASE LAW AND 1933 SECURITIES ACT FOR DEFINITION OF A SECURITY: cl001-ch02_thumb

Attorneys for lenders have an index for me that I’ll call the “obnoxious” scale because that is what they say out loud but I don’t know what they call it internally. Among the highest items on their list is identity theft as a cause of action and violation of the securities laws. They think that both are a stretch. I’ll agree that there is no case law specifically on point about identity theft but there is plenty of case law and statutory authority for my contention that the loans were financial products sold to clueless homeowners who were told that they already had an immediate profit (inflated appraisal) that they would get money from that profit, and that they would profit more if they “purchased” this loan product that someone was slipping in front of them. All they had to was sign.

They paid for this financial product with their homes, their lives and their economic prospects in a depression caused by market-wide fraud, the most difficult to detect because it is hard to imagine how anyone could manipulate the entire market. But then again, that is what “Cornering” the market is all about.

Remember that the finance sector was dealing in money, not real property — a fact often lost on those interpreting the requirements of rescission. They funded money in your name they didn’t sell you a house. I’ll agree if they were selling the house, my concept would be considerably weakened. But that isn’t what happened. And the banks are capitalizing on the confusion between the money and the house. Wall Street sold you a financial vehicle by which they told you that the money you were getting was passive profit and would result in more passive profit. Your primary purpose in buying this financial product was financial gain without doing any work. You paid for this financial product with your home, and the money you paid or became obligated to pay at closing in points, closing costs etc.

The primary motivation for accepting the deal that was called a loan was to make a profit, with living in the house being a secondary consideration. The people who got cheated out of their homes by the acceptance of this financial product would definitely have made other arrangements had they known the property was in fact worth less (or worthless) than the appraisal figure that confirmed by the lender under the lender’s obligations as set forth in federal and state lending laws. This is especially true if they had known that they would be obligated for an amount in excess of the true fair market value of the house and that said value could not be sustained and would go down. Many if not most homeowners involved in any mortgage transaction fall into this category.

So if your house was “foreclosed” (probably illegally) and the Bank or its affiliates are holding it, you might want to check with a securities lawyer because rescission would be the return of the house and all other consideration paid by you for this “investment opportunity.”

And this, my friends at Bryan Cave, et al, is my most obnoxious present to you — compensatory damages in the amount of the investment, plus punitive damages and possibly damages for “benefit of the bargain.” Have a nice day.

Guess what? The Securities Act of 1933 defines a security:

Under Section 2(a)(1) of the Securities Act of 1933, “unless the context otherwise requires,” the term “security” includes
any note, stock, treasury stock, security future, bond, debenture, evidence of indebtedness, certificate of interest or participation in any profit-sharing agreement, collateral-trust certificate, preorganization certificate or subscription, transferable share, investment contract, voting-trust certificate, certificate of deposit for a security, fractional undivided interest in oil, gas, or other mineral rights, any put, call, straddle, option, or privilege on any security, certificate of deposit, or group or index of securities (including any interest therein or based on the value thereof), or any put, call, straddle, option, or privilege entered into on a national securities exchange relating to foreign currency, or, in general, any interest or instrument commonly known as a “security”, or any certificate of interest or participation in, temporary or interim certificate for, receipt for, guarantee of, or warrant or right to subscribe to or purchase, any of the foregoing.

Case Law Guides us. Here is a U.S. Supreme Court case:

As the Supreme Court stated in Marine Bank v. Weaver, 455 U.S. 551, (1982), construing the virtually identical definition of “security” under the Securities Exchange Act of 1934, the definition is “quite broad” and meant to include “the many types of instruments that in our commercial world fall within the ordinary concept of a security,” including “stocks and bonds, along with the countless and variable schemes devised by those who seek the use of the money of others on the promise of profits.” Weaver, 455 U.S. at 555.

The Supreme Court has suggested that “instrument commonly known as a security” and “investment contract” have the same meaning for purposes of the Securities Act and the Exchange Act. United Housing Foundation, Inc. v. Forman, 421 U.S. 837, 852.

Here is an example of something you wouldn’t normally think is a security, but the Courts held that this WAS a security:

SEC v. W.J. Howey Co. 328 U.S. 293 (1946)
The Howey Company, a Florida corporation that sold small tracts of land in a citrus grove to 42 purchasers, many of whom were patrons of a nearby resort hotel. While investing in the enterprise for profit, the purchasers, for the most part, lacked the knowledge, skill, and equipment necessary for the care and cultivation of citrus trees. And while the purchasers were free to service the tracts themselves, or contract with a number of companies to service the tracts for them, the sales contract stressed the superiority of a Howey-related service company, Howey-in-the-Hills Service, Inc. (“HITH”), which purchasers of 85 percent of the acreage chose to service their tracts. The service contracts granted HITH full and complete possession of the acreage. Individual purchasers had no right of entry to market the crop, but shared in the profits of the enterprise, which amounted to 20 percent in the 1943-44 growing season.

And in another case —

Forman stands for the proposition that to determine whether a particular financial instrument is an investment contract, using the test the Court set out in Howey, the test is to be applied in light of “the substance—the economic realities of the transaction—rather than the names that may have been employed by the parties.” Forman, 421 U.S. at 851-52.

And finally

In SEC v. SG Ltd., 265 F.3d 42 (1st Cir. 2001), the First Circuit held that “virtual shares” in an Internet game were securities. The defendant operated “StockGeneration,” a website where visitors could buy “virtual shares” in “virtual companies” on a “virtual stock exchange.”


7 Responses

  1. This message is for Linda who posted regarding the BC info.
    How can i gain access to those funds, by what method
    would we use, banker, stock broker etc.?

    You can e-mail to; dennis4356@yahoo.com

    Thank you very much, Dennis

  2. Countrywide stole my condo & threw me out the door 5 years ago in April. Do you know of anyone in Fort Collins or Denver Colorado who could help me in the process of getting my condo back? Thank you.

  3. I guess this is the worst financial bubble of them all–signing on the dotted line so you can be used as a “security instrument”. Wall Street is still humming along and nothing happens to them. They get richer and richer. My question has always been: how much money do you need? The real answer is power. How much power do you need?
    http://www.challengingforclosure.com Sirak@challengingforeclosure.com

  4. Linda,

    If you look at a copy of your Birth Certificate (you know the one printed on ‘bank note’ paper?) you’ll see there are some red numbers sometimes mixed with letters stamped somewhere on the front. The first 3 of those numbers (not letters) can be used to find out what stock market fund you are in (traded on the stock exchange) on Fidelity’s website. I’ve done it myself, go to https://www.fidelity.com/ under Research click Quotes, then click Find Symbol, in the fist drop box put Mutual Fund in the second put Fund Number and then in the search value put the 3 digit number from your Birth Cert and you should get one result. mine was
    “FIDELITY ADVISOR HIGH INCOME CL A FHIAX 374”
    If you google yours like mine without quotes you can see how much the Fund is worth. mine is
    “Net Assets: $272,956,434.87 as of 12/31/2010
    Portfolio Assets: $831,730,982.63 as of 12/31/2010”

    If you’ve ever wondered why suicide is illegal, now you should know. Because it’s considered DESTRUCTION OF GOVERNMENT PROPERTY.

    End Government Enslavement
    http://www.ipetitions.com/petition/alter-and-abolish/

  5. You know the untouchables see us simply as a labor force to use and abuse as we have been it could get worse much worse unless we fight as best we can I stay open to some kind of paradim shift in society but we need to catalyse this any way possible to protect our future generations

  6. Well said Linda. We must get all of America to stand up on this one

  7. And by swindling our signatures banks were not mortgaging our homes, they were mortgaging our persons !!

    WE are being sold on Wall street and our family’s futures are being fleeced.

    To all you bastard banks– I AM NOT A NOTE, A STOCK, or a SECURITY. I am a HUMAN BEING.

    Had I known banks were pimping my person all over the world, I could have done that myself.

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