BANKS SEEKING TO CONTROL THE EVIDENCE WITH “CONFIDENTIALITY” AND “SEALED” FILES

ONE ON ONE WITH NEIL GARFIELD ONE ON ONE WITH NEIL GARFIELD

COMBO ANALYSIS TITLE AND SECURITIZATION

EDITOR’S COMMENT: This is one reason why you need to get all the research you can get done right away. Through back-room deals, back-doors, proposals and exotic transactions, the banks are maneuvering into position where they get to control the evidence of the the money trail and the paper trail.

DO YOUR DISCOVERY NOW!!

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Why Does JP Morgan Want This Fraud Suit Sealed?

Posted by Teri Buhl under Bank Fraud

JP Morgan is being sued by Ambac for allegedly selling the insurance company hundreds of millions of mortgage back securities while knowingly packing them full of loans they knew were bad. The loans stem from MBS created by Bear Stearns that JP Morgan took control of after they bought the failed bank in 2008. While this might sound like an ailing mortgage insurer trying to pass off blame for buying a financial product that didn’t work out, if we could look inside the lawsuit we’d likely see otherwise.

The problem is the bank, who’s known to have close ties to Obama’s administration, has somehow convinced a judge in the Southern District of New York to seal the complaint. Combing through the legal documents filed before the seal was ordered, we get a glimpse of what has JP Morgan so worried – although because the lawsuit is sealed we still don’t get to see how Ambac can claim these violations of securities laws were started.

Ambac accuses JP Morgan (NYSE:JPM) and the Proposed Individual Defendants of:
(i) “accounting fraud”
(ii) implementing a “bad faith” strategy to reject without justification insurers’ and investors’ demands for the repurchase of breaching loans
(iii) “arbitrarily” denying demands by investors and insurers to repurchase loans
(iv) “manipulating” its accounting reserves
(v) “obscene compensation” and “reckless pursuit of fees”
(vi) “encourag[ing]” the acquisition of defective loans

Talk about accusing them with the kitchen sink of bank fraud. Now here is what I find a weak excuse for why the investors in a publicly traded company (or anyone else who’s interested) shouldn’t be allowed to see this complaint. JP Morgan’s argument is because Abmac was able to get sworn testimony, about how they broke the law, from people working inside the mortgage security packaging division; that this information should be considered a trade secret. On top of that, JP Morgan argues that because ex-employees of these alleged financial criminals are testifying exactly who at the bank told them to skirt the law, this information must be suppressed because it might damage top JPM executives’ reputations.

Sound fishy? This week I went on financial TV journalist Max Keiser’s show to tell his international audience just what JP Morgan was up to. It drew hundreds of comments packed with fans of The Keiser Report screaming this shows just how connected JP Morgan is to a Federal government known to play favorites with American’s bulge banks.

Yet what’s going on behind the scenes is even more alarming. Abmac was able to add testimony to its complaint after I broke news at TheAtlantic.com about Bear Stearns falsifying some of the mortgage details they supplied the raters. You know — to get a better rating so firms like Ambac would buy and insure their mortgage securities. One of the ex-Bear employees quoted in my story, Matt Van Leeuwen, then offered to tell Ambac’s lawyers even more about the misconduct and fraud he witnessed. These Ambac lawyers were also able to see unpublished taped interviews in Nick Verbitsky’s upcoming documentary film ‘The Confidence Game’, which added more clues to who and how Bear Stearns was building RMBS with loans they knew were already in default. But eight days before Van Leeuwen was schedualed to appear in depositions he’d been lawyer’ed up by JP Morgan; claiming because he received a severance when he left the bank they had to represent him. Then according to Van Leeuwen’s deposition transcript, he testified that he’d embellished what he told the documentary film maker in a hour long interview and that some of the information he gave me for my The Atlantic story was taken out of context or only offered on background.

Wow talk about a bait and switch. Of course Verbitsky and I had interviewed other co-workers of Van Leeuwen who corroborated most of his original testimony. So to see him try and swear under oath that he made it up was not only shocking but a clear sign of how influential JP Morgan can be when someone wants to whistleblow. As for Van Leeuwen, he’s suddenly found the funds to attend Law School at the University of Texas; the Ambac lawyers are looking into possible payoffs to get him to change his testimony. They’ve also been granted a court order to get copies of emails from Van Leeuwen and the journalist he gave interviews with in an attempt to prove he lied under oath about not being a willing participant in our stories.

Luckily Van Leeuwen isn’t their only star witness; they have near half a dozen more insiders willing to speak out. Since my story at The Atlantic came out, the Financial Crisis Inquiry Commission got Verbitsky to show them his unpublished taped insider interviews, including – Van Leeuwen’s, and there is a chance they will subpoena Van Leeuwen to testify.

Ambac lawyers now wait for the good graces of a New York federal judge to let them submit their evidence in an amended complaint. A decision is expected by the end of the year. Although the American public, along with investors in JP Morgan, might be kept in the dark about who did what and how they did it, if a media company doesn’t pay to sue and unseal the case.

The Case is: AMBAC v EMC Mortgage Et Al New York Fed – USDC Southern District of New York – 110508 091754 – 08 CV

EMC was a wholly-owned sub mortgage company of Bear Stearns and is now owned and controlled by JP Morgan.

44 Responses

  1. What I’m trippin off is this sole ceo of all of my companies what his deal , he a real air head isent he . Now how can all state sue bank of america the biggest company in the world ill prove it too the test I no what I own , united states mortgage and trust company took over chemical bank 1906 . Now the chemical bank is bank of america now , ckeck this chemical bank in 1996 bought the chase manhatten bank , its more too this , the bank of america pull to big one , continental bank aka norwest corp , bought wellsfargo bank 1998 . All of this stuff is bank of america n in a nother name . Now the sears robuke , bank , all state bank and insurance is own by a p giannini – all state insurance co . Sue the frauder are sueing their selfs , u see the employee don’t no what all we own . So they do what they are told and the scam gos out . All the scammer are doing robbeing me the real owner to sleep . Why would a real owner do all of these crimes to get him self sued . That crap .

  2. ian and Deb wynn

    We are on the same track. Believe we have same radar.

    Ian— appears it was removed from MERS —

  3. Remember reading on here ling time ago a post that stated the number of homes sold and the number of loans registered in the mers system did not add up I think more than double registered in the mers system. Well another duh when all that is needed us a sign on and a password there us no built in integrity whatsoever that the record is accurate but that was the means to the ends

  4. Duh- I posted a couple of MERS information items the last couple of days regarding bogus MIN #s etc.,and in looking over my docs, I have two MERS notes, one actual, one bogus, one unknown, and there are no MIN #s on the bogus one or the unknown one. What does it mean if there is no MIN # on a MERS loan? This is ridiculous. Any MERS experts out there? Just when I think I know something…….

  5. To all of you honorable individuals , all we can do is all we can do and at least we can say we tried to do something, a good way
    and if I could get Roger cook here I would

  6. deb wynn- here is an example of what we are all up against. In the massive lawsuit against Countrywide (BOA) by investors reported yesterday, the response from BOA was; BOA spokeswoman Shirley Norton said in a statement that the lender would review the lawsuit, “but on first glance this sounds like large, sophisticated investors who now want to blame someone for the fact that the declining economy caused their investments to lose value.” Knowing what we all know, statements such as this make my head spin. Why should a “news organization” report in this manner without a statement from the plaintiff, such as, “the loans in the pools were never transferred into the trusts, the loans themselves were based on fraudulent loan applications dummied up by the originators cut & paste departments, the same loans were sold to multiple parties, the GSE loans put to Fannie and Freddie were just plain theft costing taxpayers hundreds of billions of dollars with no end in sight, and most of the paperwork tracking and verifying the whole mess has been lost, destroyed, as in yesterday’s Del. bk court decision, ordered shredded by the presiding judge. Why don’t we see a quick response from the plaintiffs such as this? This has my stomach in knots.

  7. AND realignment of the parties burden of proof on them. … Sorry talk to the hand as far as the court goes but what else can we do

  8. Agreed Ian no standing no beneficial interest no foreclosure. Why shouldn’t thst equal discovery

  9. deb wynn- it is good that you are questioning the parts played by all parties. As several million foreclosures have already gone through, you can see that the letter of the law(s) is not being followed. It is getting alot better following the robosigning msm coverage. But still judges are stuck on “did you borrow the money? have you made your payments?” In reality, the way this entire scheme was orchestrated is brilliant. Can we really expect a judge to pore over SEC docs, PSAs,Prospectuses, NY trust law, MERS, land office records, bogus signatures, expired notary seals, junk fees, IRS 1120REMIC rules, and understand everything that was done? No, we can’t. I think that the critical opening argument in any of this is standing. The pretenders are by law “barred from the courthouse steps”. To that end, a short and concise explanation of why they do not have standing is critical. Some of this is overwhelming to those of us who have been trying to make sense of it for a year or two. To a judge with a full docket, or which foreclosures are just a small portion, there is simply no time to study and understand what is and has been going on. But keep questioning everything! You won’t get the right answer if you ask the wrong question.

  10. Wht do the likes of wells Fargo hsbc deutsche change roles. Deutsche is depositor in my case ( purportedly) the prospectus for a particular trust describes their roles. So their roles change as so must the prospectus presented to sll those investors. Question big question

  11. RLitton
    shoot me an email
    johngaultwhoam@yahoo.com

  12. Ron Litton, the only class action v. Deutsche’s
    I know of are in KY and FL.

  13. I almost have to laugh. I pulled that case and note that in discovery, Ambac found a memo from a Bear Sterns manager referring to the loans to be securitized and sold to the suckers as “A SACK OF S—T.” Nice. How in the world did we raise these
    rat-bastards?

  14. I’m thinking of a uk series called the cook report. Where Roger cook would expose scandles and racketteering and show up at their yaughts or wherever he could smuggle his film crew in and he would get in their face and ask them the six million dollar questions that guy went to the island of Tenerife to try to exposethe guy that pretty much runs the island Who purportedly was linked to a huge gold bullion robbery in uk he was just asking him some ebarrassung questions on camera… Where are the roger cooks of this world. Having said that it was a while ago hate to admit, and he got a
    woopin with a baseball bat all caught on camera once or twice. He was bad ass and the public loved him for that lol. How to get the message out en mass ?

  15. Are there any national class actions started that are against Chase as the servicer and Deutsche as the trustee? I am in KS.

    I am being sued for foreclosure by Deutsche, which was a surprise to me, as I was in the mod process with Chase, who I thought owned my loan.

    Deutsche is NOT on an assignment here either. So they have no standing. I have an attorney and have told them we will protect in bankruptcy if needed. Case is still filed, but they have done nothing.

    I also now hear nothing from Chase either.

    We do have the ruling in KS in 2009 that makes them produce a note, I do not think they can. Seems that once the foreclsoure fraud hit the news they pulled back. Any thoughts.

  16. brian davies- that is one convoluted path for your note. Did you track that yourself? Or hire it out? If so, who did you use? What is the fee for something like that?

  17. Ian, I like that idea.

    John, yes old servicer sent us a letter informing us of a new servicer. I didn’t know about this MBS stuff at the time. I would have sent a QWR to the old servicer when we applied for a home mod.

  18. The lawsuit was finally unsealed. I report at The Atlantic on which Bear traders were stealing from their clients. They all are working at banks like Goldman and Bank of America still.
    http://www.theatlantic.com/business/archive/2011/01/e-mails-show-bear-stearns-cheated-clients-out-of-billions/70128/

  19. cubed2k. It’s my understanding a notification of a change of servicer must come from your existing servicer, not the alleged ‘new’ one.

  20. Ian, that was funny. I needed the chuckle. Thanks.

  21. Listen up people!

    Greg Bryl, Esq, took $2800 of our hard earned money from us and has not provided us with anything in return.

    Despite our multiple requests for a refund, he has refused to refund our money.

    He is trolling this site looking to profit from homeowners hardship.

    We have filed a Complaint with our AG for Unlicensed Practice of Law and are finalizing a Complaint to be filed in his home state of Virginia (which by the way is the only state he is licensed to practice in).

    At this time I would like to hear from anyone that has had any other dealings with him. I want the good, the bad and the ugly!

    Please email me all of your stories and/or comments to:

    providencegroup@ymail.com

    Lets combine our forces and put him and all other dishonest attorneys out of business of scamming homeowners!!!

  22. Two brand new cases in Nevada find nonjudicial foreclosure execution defective:
    http://bryllaw.blogspot.com/2011/01/nevada-another-non-judicial-state-where.html

  23. Guess this says it all …criminal activity is now alleged to be “Intellectual property” by perpetrator…and subject to being suppressed…c’mon folks you can’t make this stuff up…

    Truth out.

    “JP Morgan’s argument is because Abmac was able to get sworn testimony, about how they broke the law, from people working inside the mortgage security packaging division; that this information should be considered a trade secret.”

  24. cubed2k- when your new servicer sends you papers, make sure they are original. If they send you copies, send them a picture of your house and call it even.

  25. Well, got a response from my new mortgage servicer. Wrote a letter to them 26 oct 2010 asking for a copy of the original promissory note and a copy of the deed of trust. They first responded with a letter saying they will reply in 60 business days. So, the new letter states they need more time and will respond with a new letter, and by the way you are behind in your mortgage payments since March, 2010. Which is when we applied for a mod and Chase said to stop making payments, but Chase in the middle of loan mod sent us a letter saying you have a new loan servicer. All paperwork will be forwarded to them. Of course it was not.
    What a damn joke. And these people, companies, are professionals, what a joke. Why can’t anybody in power – Congress, Judges, Lawyers, etc if you will, see the pure simplicity of the rip-off.
    I get a piece of paper in the mail that says you now make your mortgage payments to us, send check every 25th of month. Well god damn it – who the hell are you and prove it dude. SHOW ME YOUR PAPERS!!!!!!!!!!!
    Can I send a piece of paper to anybody and tell them to send me your mortgage payment to me. Won’t I get throw in jail for FRAUD. SHOW ME YOUR PAPERS DUDE. It is too simple and yet made so complicated. That in itself shows RED FLAGS that these so called leaders and JUDGES should be saying, HEY WAIT A MINUTE, WHAT IN THE HELL IS GOING ON HERE.

  26. SECOND NOTE QUALIFIED WRITTEN REQUEST WITH NOTE ENDORSEMENTS. SEE MERS AUDIT TRAIL FOR OWNERS.

    SLS SAYS TERWIN ADVISORS OWN.
    THE NOTE SAY LASALLE BANK,
    THE MERS AUDIT SAY US BANK AS TRUSTEE

    MERS IS THE ONLY ONE ON THE SECURITY INSTRUMENT FILED IN THE LAND TITLE RECORDS

    http://www.scribd.com/doc/47504530/Brian-Davies-Second-Note-Qualified-Written-Report-Specialized-LOAN-SERVICING-With-Appraisal-Tila-Hud-Etc-Copy-2

  27. COMPLETE AUDIT TRAIL AND GRAPHS BY JAMES MCGUIRE RESULTS FROM FIRST AND SECOND MORTGAGES. THIS DETAILS SERVICERS AND BENEFICIAL OWNERS. THIS IS NEEDED TO GET TO THE TIMING OF THE ASSIGNMENTS. NOTE THE FIRST NOTE WAS TRANSFERRED TO THE INVESTOR OVER 6 MONTHS AFTER CLOSING DATE. THE ASSIGNMENT WAS 3.5 YRS LATE.

    THE SECOND NOTE HAS INVESTOR AS US BANK. THE NOTE SAY LASALLE BANK, AND THE QWR SAYS TERWIN ADVISORS. ONLY ONE MERS SUBORDINATE DEED OF TRUST IN THE LAND RECORDS. THIS MAY PRESENT PROBLEMS.

    http://www.scribd.com/doc/47504191/Supoena-Records-From-From-Mers-12-08-2010-w-Chart

  28. Is this too bad to be true?

    Financial Crisis Commission Finds Cause For Prosecution Of Wall Street

    http://www.huffingtonpost.com/2011/01/24/financial-crisis-commissi_2_n_813415.html

  29. http://www.scribd.com/doc/47503979/Financial-Crisis-Commission-Finds-Cause-for-Prosecution-of-Wall-Street

    FINANCIAL CRISIS COMMISSION REFERS WALL STREET FOR CRIMINAL CHARGES

  30. Don’t know if this counts but you start with a min number but then the number changes immediately when it us ” sold” that’s tecniqally( well in my case) at closing of the “loan” the number is now the loan number not the min number which is alteration we have statutes regarding this. ” alteration”. Just a thought but it really means that the product changed

  31. Well, only 90% legit BofA loans?, so Neil’s prediction of 4% of the total being good isn’t really that far off? You have been right all along. 90%, mark to mark, rube to rube, not with any kind of legitimate accounting to find actual fact. If they claim 90 after a brief and censored accounting, what will reality show?
    Thanks Neil, It’s great to learn a lot of new things every day.

  32. dny

    Servicers can negotiate modifications — but must be on behalf of the creditor. Cannot conceal creditor — a mod would be a new contract that must be in the name of the current creditor — not the servicer.

    Ian

    Just seeing your post regarding 17 and 18 digit MERS — good pick up — did not notice this — and will go back and look.

    TMT — incredible!!!!!!

    Thanks.

  33. THIS is a direct quote from MERS’ web site “MERS Servicer ID” (under “WHY DO YOU NEED TO KNOW THE IDENTITY OF YOUR SERVICER?” Point 3, at http://www.mersinc.org/homeowners/index.aspx#3 ):

    “Contrary to popular belief, it is your Servicer and not the lender that can negotiate the terms of the loan with you.”

    What MERS “helpfully” points out (above) to those inquiring persons utilizing its Internet “tool” also appears to be contrary to most of the actual language found in the notes, deeds of trust and/or mortgage documents that any of us all have ever seen. Aren’t they just so dang helpful?

  34. Erroneous MERS MIN #s: these were used just prior to an entity’s BK or “strategic merger”. If you think about it, these entities didn’t just wake up one morning and go ch11: they were on the ropes for 6-12 months or more, and as things worsened, they failed to pay their MERS bills (deadbeat scumbags) so they could no longer use the system. So, rather than robosigning, they made up fraudulent MERS MIN #s in order to pass the buck, or in this case, the mortgage/note to the next crook in the ponzi scheme. So, I would venture that a fraud (bogus MIN #s) upon a fraud (MERS) entirely voids the assignment and breaks the chain of title. IN OTHER WORDS, IF THEY ARE TRYING (and succeeding) IN USING MERS TO FORECLOSE, AND THEY DON’T HAVE MERS, THEN THEY CAN’T FORECLOSE, AS MERS IS CENTRAL TO THEIR ARGUMENT. NEIL/

  35. LETS GO PUBLIC:

    * Newspapers
    * Start a Blog for your case or defaulted loan.
    * Make posts about entity of Rip-off-report.com
    * Start Class Action Sign Up lists for each entity we are fighting.
    * Email and fax your Congressman/Senator and state Senator.
    * File Open Letters to the Judge in the Court File
    * Mail Letters to the Attorney for breach of the Oath and Ethics rules for an attorney: calling them on the carpet.

    DOES ANYONE KNOW IF WE COULD RUN AN ADVERTISEMENT IN THE PAPER AND NOT BE SUED FOR TRADEMARK INFRINGEMENT OR OTHER:

    Newspaper advertisement example?

    CLASS ACTION PARTNERS WANTED FOR XYZ BANK

    If you were;
    * Foreclosed
    * Denied a Short Sale
    * Denied a Deed-In-Lieu
    * in Foreclosure
    * Denied Loan modification
    * threatened by XYX bank or Attorney
    * Lender refied your loan without benefit to you and raised payments to make it unaffordable.
    * Lender did no doc loan or stated income after you provided your tax returns
    * Lender knew you could not afford the payments or had the ability to repay the loan.
    * Lender forecast in Annual reports a predicted decrease in property values and more losses for the lender, but failed to mitigate.
    * Lender sold your profit or has it for sale for a profit after foreclosure.

  36. ANONYMOUS- on my previous post to zurenarrh to give him and others the MERS investor ID info using the MIN #, I mentioned that a number of notes I examined had 17 digits instead of 18 for the MERS MIN#. Have you seen this to any significant extent? This is yet another clue for attys. and pro se’s to investigate. I would surmise that since a MIN # is 18 digits to enable MERS as agent/beneficiary or whatever they are this week, then 17 digits would render them as nothing. Void, and toss the whole complaint. ?

  37. (Reuters) – Federal bankruptcy judges in Delaware are due to hold separate hearings Monday on requests by two defunct subprime mortgage lenders to destroy thousands of boxes of original loan documents.

    http://www.reuters.com/article/idUSTRE70N2AA20110124?feedType=RSS&feedName=businessNews&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+reuters%2FbusinessNews+%28News+%2F+US+%2F+Business+News%29

  38. zurenarrh- the site to find out your “investor” is simply MERS Investor ID, hit search and there it is. You will need your MIN #, a suspicious fact I unearthed last year was that a number of “loans” had 17 instead of 18 numbers in their MIN. No judge on earth will ever catch that.

  39. Louise- re:whistleblowers- one of the reasons why financial services industry salaries/bonuses/stock options have risen yet again is to help deter employees from becoming whistleblowers. Keep them happy, rather than “disgruntled ex-employees”

  40. Ian

    I am seeing changes too — and no “trust” as investor.

  41. The more whistleblowers, the better. I recently saw a 60 Minutes story about a woman whistleblower who outed a pharmaceutical company (GlaxoSmithKline) for manufacturing bad medicine and/or wrong labeling and/or too strong or too weak. She received multimillions of dollars for this testimony. I hope it makes more people want to come forward and speak the truth about the corporate greed.

  42. Ian, where are you checking the MERS ID that reveals this info? This sounds similar to BAC and CIG–same company that they pretend are two different ones…

  43. zurenarrh- a small tidbit. A year ago I checked MERS investor ID and saw EMC mortgage (Bear Stearns) as investor. Last week, on a whim, I again checked MERS investor ID and saw Encore Credit (Bear Stearns) as investor. There must be a reason for this, perhaps moving everything from one entity to a less vulnerable entity. Thoughts?

  44. Max Keiser is JP Morgan’s worst enemy and hence, my best friend.

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