CA BKR DENIES STAY, ORDERS SANCTIONS AGAINST ONEWEST, INDYMAC

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“the Court will not participate in a process where OneWest increases its profits by disobeying the rules of this Court and by providing the Court with erroneous information

NEW NOTE GAMBIT ANGERS JUDGE

EDITOR’S COMMENT: We’ve been watching this for years. If one document doesn’t work, the pretender comes up with another “original” document. They are all fake, fabricated and forged. People have been asking us since 2007, “If what you are saying why are the Judges going along with it? Why are they not levying sanctions, referring the lawyers to the Bar for discipline and referring the banks to the justice system for criminal prosecution?” The simple answer is that the Judges didn’t believe it. They were stuck in the mental trap of believing that the banks would never intentionally do something in court that amounted to perjury, subornation of perjury and fraud. The Judges could not get their heads wrapped around the idea that the banks were in the process of a fraudulent land grab. It just didn’t make sense to them. It seemed far more likely to them, from their prior experience with foreclosures, that the process was largely clerical, that no bank would foreclose if there wasn’t a good reason and it couldn’t be worked out.

In California this attitude was particularly evident but in other states, Neil Garfield and Living lies was cited as the problem because we were filling the media with false statements of law and fact. Fast forward to the present and you see an increasing number of judges getting increasingly bold in switching their position on the banks and allowing for the possibility, even the probability that the homeowners win and the pretenders lose because they are pretenders, interlopers in a process meant to satisfy the requirements of judicial economy but which was being used (nonjudicial) to get around the basic requirements of black letter law and due process requirements contained in every state constitution and the United States Constitution.

Lawyers saw the references to me and my blog and the derisive wording about me, and they got scared that if they argued the same points they too would be the subject of derision, lose credibility with the court, and lose cases. And in fact, they were losing more cases than they were winning because even if they used the material on this blog, even if they got the COMBO title and securitization search, report and analysis that lays out everything chapter and verse, they were still losing — as a direct consequence of (a) Judges prejudging the cases and (b) the lawyers and litigants failing to object immediately as the first words were coming out of the mouths of the lawyers for the pretenders and failing to object to the first documents proffered. Most of all they were losing because they failed to deny the default, deny the right right of the forecloser to be initiating any collection or foreclosure proceeding, and deny that the originating papers were representative of the actual cash transaction that took place.

If you don’t object to an allegation, you are admitting it. If you don’t object to a document, it comes in as “evidence.” And the reason the lawyers were not objecting was that they had the same mindset as the Judges. How could they deny a default when they knew that the homeowner had not made payments on the note and mortgage that was attached as copies to the pleadings of the pretenders? If you don’t make the payments, you’re in default, right? WRONG! A default occurs only if the creditor fails to receive payment, not when the borrower decides to not make the payment. A default exists only if there is a gap in payments that are due, not payments that are shown on a piece of paper. If the payments were made anyway by a third party, there is no default and none can be declared.

And the declarer of the default must be someone who has an interest in the obligation. And the default must reference the obligation which normally is on the loan documents signed at closing but in the case of table funded loans that are enmeshed in a false securitization scheme, those documents do NOT set forth the terms or the parties involved in the transaction — so they can’t be used. If the loan documents at the so-called “closing” can’t be used we are left with an undocumented transaction between the homeowner, who is not known to the investor-lender, and the investors lender who is not known to the homeowner-borrower. They each got a separate set of documents including terms, conditions guarantees, cross collateralization, insurance and other third party payments (from servicers who keep paying in order to collect higher fees for “non-performing” loans. So in terms of documents there was no deal, and if the truth was told to both real parties in interest there wouldn’t have been a deal.

Nonetheless an obligation arose between the homeowner-borrower and the investor lender because the homeowner-borrower received the benefit of funding from the investor-lender, albeit under false pretenses including appraisal fraud at the loan level and ratings fraud at the investment level. The transaction is both undocumented and unsecured. And the obligation is subject to offset from a menu of affirmative defenses, rescission remedies, and counterclaims from the homeowners borrower. The property is now worth a small fraction of what was represented at the loan level closing and the investment level closing. So the investors are ignoring any remedies against homeowners because they don’t want to get tied up in litigation in which their net recovery is negative — i.e., they owe more to the homeowner than the homeowner owes on the obligation.

Enter the pretenders who figure that if the investors don’t want to go after the homes, then the banks will and who will challenge the banks since they appear to be the lenders in these transactions, even if they are not. Their defects in documentation and the facts (they were not included in the money trail of the loan transaction) were glossed over by lawyers and judges and even the media. Now, the Judges are taking a closer look and finding that not only do these pretenders lack standing, not only are they not the real parties in interest, but that that they and their lawyers are probably guilty of intentional fraud on the court and in this case, as well as others across the country, the Judge is ordering sanctions and fines.

FROM STOPFORECLOSURENOW.COM

IN RE ARIZMENDI | CA Bank. Court Denies Stay, Order to Show Cause “Contempt, Sanctions, (2) ONEWEST Notes; 1 Endorsed, 1 Unendorsed” “MERS Assignment”

In re: Jessie M. Arizmendi, Debtor.
OneWest Bank FSB, its assignees and/or successors, Moving Party,
v.
Jessie M. Arizmendi, Debtor; Thomas H. Billingslea, Chapter 13 Trustee; and Indymac Mortgage Services, Junior Lien, Respondents.

Bk. No. 09-19263-PB13, RS No. CNR-2.

United States Bankruptcy Court, S.D. California.

May 26, 2011.

Not for Publication

MEMORANDUM DECISION

LAURA S. TAYLOR, Bankruptcy Judge

EXCERPTS:

Additional Briefing.

At the trial, the Court carefully considered the demeanor of the various witnesses and the testimony provided. In connection with the trial, the Court also reviewed all other evidence and argument appropriately before the Court. Notwithstanding, however, significant questions continued, and the Court required additional briefing in connection with several issues as outlined in the Order Setting Briefing Schedule, Outlining Preliminary Determinations, and Establishing Procedures for Final Resolution of Issues (Dkt. No. 56) (the “Briefing Order”).

OneWest’s post-trial documents provided the analysis and argument required by the Briefing Order. But, these documents also contained factual assertions inconsistent with the OneWest Declaration and the Claim. OneWest now provided a standing argument based on a new version of the Note (the “Endorsed Note”).[3] The Endorsed Note attached an allonge dated July 24, 2007 evidencing a transfer from Original Lender to “IndyMac Bank, FSB” and bore an endorsement in blank from IndyMac Bank F.S.B. OneWest argued in connection therewith that it had enforcement rights under the Endorsed Note as a holder notwithstanding the admittedly accurate testimony at trial indicating that OneWest is a servicer for Freddie Mac and not the secured creditor. The OneWest post-trial memorandum also references a separate agreement with Freddie Mac, but fails to further evidence or discuss this agreement. The OneWest post-trial memorandum, finally, bases a standing argument on physical possession of the Endorsed Note and OneWest’s alleged status as a trust deed beneficiary based on the Assignment.

[…]

But, there are key assumptions that the Court must make in order for this set of facts to withstand scrutiny. And they are that OneWest, in fact, holds the Endorsed Note and held the Endorsed Note at all appropriate points in time. Frankly, the Court is not willing to make such assumptions at this time. OneWest attached the Unendorsed Note to both its Proof of Claim and the Declaration. The Declaration stated under penalty of perjury, that the Unendorsed Note was a true and accurate copy of the Note held by OneWest. The Proof of Claim implicitly stated the same and OneWest, of course, is obligated to provide only accurate information in connection with its Proof of Claim. The problem is that the Unendorsed Note does not bear the endorsement or attach the allonge found on the Endorsed Note, a document produced only after trial and the close of evidence. One West, thus, leaves the Court with the quandary of guessing which promissory note OneWest holds, whether and when One West held the Endorsed Note, and what the explanation is for the failure to provide the Endorsed Note prior to the close of evidence.[10]

A further evidentiary anomaly arises on account of the Assignment; MERS executed this document as a nominee for the Original Lender. But the allonge to the Endorsed Note makes clear that the Original Lender assigned its interests in the Note more than three years prior to execution of the Assignment. And rights under the Trust Deed follow the Note. Polhemas v. Trainer, 30 Cal. 686, 688 (1866). Thus, MERS’ purported assignment of the Trust Deed and the related note as nominee for the Original Lender and without a reference to either IndyMac Bank, FSB or Freddie Mac appears designed to disguise rather than to illuminate the facts.

And finally, even if OneWest’s second post-trial discussion of standing and submission of evidence were accurate, one thing remains clear: OneWest failed to tell the true and complete story in the OneWest Declaration and in the Claim.

The Court is concerned, as a result, that OneWest does not hold the Endorsed Note. But, perhaps more significantly, the Court is concerned that OneWest has determined that business expediency and cost containment are more important than complete candor with the courts. On these points, Ms. Arizmendi has a right to be heard, and the Court has a right to explanation.

Further, this is not the first time that OneWest has provided less than complete information in the Southern District of California. See “Memorandum Decision Re Motion to Vacate Clerk’s Entry of Default and Motion to Dismiss Complaint; Order to Show Cause for Contempt of Court”, docket no. 39, Adv. Pro. 10-90308-MM (In re Doble; Bk. Case No. 10-11296) (Defendants, including OneWest, were neither candid nor credible in explaining failure to respond timely to complaint and submitted multiple and different notes as “true and correct”); “Order to Show Cause Why OneWest Bank, FSB and Its Attorneys Law Offices of Randall Miller and Christopher Hoo Should Not Appear Before the Court to Explain Why They Should Not Be Held in Contempt or Sanctioned”, docket no. 47, In re Carter, Bk. Case No. 10-10257-MM13 (among other things OneWest provides inconsistent evidence as to its servicer status); and “Order After Hearing to Show Cause Why Indymac Mortgage Services; OneWest Bank, FSB; Randall S. Miller & Associates, P.C.; Christopher J. Hoo; Barrett Daffin Frappier Treder & Weiss, LLP; and Darlene C. Vigil Should Not Appear Before the Court to Explain Why They Should Not Be Held in Contempt or Sanctioned”, docket no. 47, In re Telebrico, Bk. No. 10-07643-LA13 (Court concerned that OneWest provided evidence that was either intentionally or recklessly false).

The curious thing about these cases is that OneWest likely would prevail in each of them if it completely and candidly explained the basis for its motion and its standing in connection therewith. Undoubtedly, however, doing so is more costly than using a form declaration that is not customized as to the facts on a case by case basis and that is signed by an uninformed declarant. OneWest perhaps assumes that it really does not matter if the Court provides relief based on erroneous information. But, OneWest should remember an earlier theme in this decision and that is that the law is the law, rules are rules, and both must be obeyed. And, when it becomes clear that OneWest did not obey the rules, the Court can and, indeed, must act.

In short, the Court will not participate in a process where OneWest increases its profits by disobeying the rules of this Court and by providing the Court with erroneous information. The Court, thus, will take two steps. First, the Court will deny the Stay Motion without prejudice based first on the evidentiary problems that make it impossible for the Court to determine that OneWest is properly before the Court and that render evidence critical to OneWest’s prima facie case unreliable and second based on the Court’s inherent authority to regulate and control proceedings. Next, the Court hereafter will issue an order to show cause why One West should not be held in contempt and/or otherwise sanctioned. In connection therewith, the Court will consider a compensatory sanction to include a recovery of any costs Ms. Arizmendi would not have incurred but for OneWest’s improper actions. The compensatory sanction, frankly, could be quite limited. But, the Court also believes that a coercive sanction may well be appropriate. Given the orders to show cause that pre-date the one this Court will issue, it appears that the Court must create an economic disincentive for OneWest that will counter balance the economic benefit of a lack of complete candor. Further detail on the Court’s sanctions considerations will be set forth in the order to show cause and will not be further discussed here.

The Court finally notes that the order to show cause will issue only as to OneWest and possibly as to MERS. OneWest uses a variety of law firms. The Court was in a position to observe the demeanor of the lawyers handling this matter when the witness stated that OneWest was a mere servicer. The Court concludes based on this observation that they were unaware of this fact and unaware that OneWest supplied questionable documentary evidence. And frankly, there is nothing to be gained in pursuing the individual attorneys who must regularly appear in front of this Court. OneWest can simply change counsel and then be less than candid with a new set of attorneys.[11] The Court is interested in modifying OneWest’s behavior at an entity level, and any coercive sanction will be designed to achieve the same.

CONCLUSION

Based on the foregoing, the Stay Motion is denied without prejudice to the right of OneWest to refile a stay relief motion. In so doing, OneWest must provide declaratory evidence that explains when and how it obtained physical possession of the Endorsed Note and/or Unendorsed Note and that otherwise provides case specific evidence of standing given its servicer status.

44 Responses

  1. To go with the below public comment, every last LAWYER like Mr. Miller and Mr. Hoo should be referred to the State Bar of the state in which they practice for investigation and disbarrment proceedings. Like the judges, their careers should be attacked by innocent homeowners for want of any morals, integrity or honesty by helping their client banks essentially lie to the judges. A few disbarrments should get the point across that homeowners will not tolerate this brand of corruption of the system.

  2. Having read the latest from Neil, and knowing of the thousands of homeowners who have been wrongfully foreclosed on by ignorant and cowardly judges….we must anonymously offer the following advise. Every last Judge that allows a bank to foreclose without showing the bank they have standing with clear documentary evidence of ownership of the note and proper accounting supporting the claim of default on the note, should have a strong complaint made to your state’s Commission on Judicial Performance [or how ever they are designated] for discipline by this body based on bias and prejudice and failure to follow the applicable law. Maybe when the judges get enough complaints against them and they have to hire attorneys to defend their careers, (which is very expensive per complaint) they will wise up. It is pathetic to see the courts align against homeowners.
    Thanks Neil for your banner of truth in this time of crisis.

  3. First of all, many of (TNHARRY) you online are not clear on the full case because there were two different judges and there were two different logic of the case and the judge reason for doing what he did had nothing to do with late documents.

    Why are Pro Se clients attack when he or she follows the law as the rules are written in the US Constitution and as a citizen, I have a right to defines my opinions.

    The judge had no intention of allowing me to present my case to the court and regardless if I am an Attorney he or she is no smarter than me and some Lawyers and judges are friends. Why would the Judge or an Attorney ignore a federal question and why would a judge have a case for 11 months and decided to forward the case to a different judge, but the 1st judge was ruling in my favor but the 2nd Judge automatically tells you what he wants to hear and ignores the (Strange) FRAUD. DO your homework before you speak.

  4. First of all, many of (TNHARRY) you online are not clear on the full case because there were two different judges and there were two different logic of the case and the judge reason for doing what he did had nothing to do with late documents.

    Why are Pro Se clients attack when he or she follows the law as the rules are written in the U.S. Constitution and as a citizen, I have a right to defines my opinions. The judge had no intention of allowing me to present my case to the court and regardless if I am an Attorney he or she is no smarter than me and some Lawyers and judges are friends.

    Why would the Judge or Attorney ignore my federal questions and why would a judge have a case for 11 months and decided to forward the case to a different judge, but the 1st judge was ruling in my favor but the 2nd Judge automatically tells you what he wants to hear and ignores the (Strange) FRAUD. DO your homework before you speak.

  5. […] CA BKR DENIES STAY, ORDERS SANCTIONS AGAINST ONEWEST, INDYMAC MOST POPULAR ARTICLES GET COMBO TITLE AND SECURITIZATION ANALYSIS – CLICK HERE — EVIDENCE COUNTS!!! “the Court will not participate in a process where OneWest increases its profits by disobeying the rules of this Court and by providing the Court with erroneous information“ NEW NOTE GAMBIT ANGERS JUDGE EDITOR’S COMMENT: We’ve been watching this for […] […]

  6. So, even if MERS is seen (by this judge, anyway), to be a beneficiary (ridiculous that a database is a beneficiary), what about proof of an actual lender? And conveyance to a trust? If a servicer tells me that my loan is in a trust—and I find out that it’s NOT in a trust—that there is NO TRUST—how the hell can they foreclose??? This is what I’m not understanding…

  7. A California court has ruled that MERS business model is legal:
    http://www.dsnews.com/articles/california-appeals-court-declares-mers-proper-beneficiary-2011-06-14

  8. @usedkarguy – generally there’s a privilege to protect law firms when acting at the direction and for the benefit of their client. the action lies against the client, not the attorneys. of course, as with everything, exceptions can and do apply…

  9. Carie,

    I love the Bahai quote. My half brother has a prominent position in the Bahai community and now I know a little more about what they stand for. Thanks. If we could all just “get it.”

  10. I agree, deb wynn—I am in “fight mode” every single day—the silver lining in all this is it’s made me a stronger person—hopefully when the dust clears humanity will be stronger…

  11. overview- onewest sold for cash at a rigged auction to hsbc for a deutsche trust, a foreclosure mill in the middle, who gets my house ….all of them, excuse me didnt indymac go into receivership…however they barely paused for air and moved forward , same time same place LPS was running things.
    hsbc send a berkley educated attorney to court who baldface slayed us without lifting his pinky finger,
    civ-09 01587 arizona district court judge Robert Clive Jones from reno navada/ visiting judge who sat in James A Teilborgs seat former judge with interests in blackrock ect, frankly i dont know who was worse!
    carie, tnharry…it takes every dime u have to fight, overtime, blood sweat and tears, no life but ive been doing this for a long time and im not going away, will probably fall down doing this. this is no time to quit, step up your game.

  12. Neil, I have been trying to find out if I signed up for the right package.
    The 1295.00 package for analysis, of the title , deed of trust, and securities, and I thought the forensic audit. I have received all but the forensic audit and want to know if I was mistaken and need to add the forensic audit. I want to have the forensics done also. I tried the e-mail and have not had success. I am sure the lumini group is very busy. Thanks Shelley.

  13. Please sign the Stop Foreclosure Now Petition!

    http://www.ipetitions.com/petition/smokeandmers911/

  14. Mr. Larry Summers…”The economy is sick”…
    And you sir, are the disgusting bacterial infection that started it all:

    http://www.huffingtonpost.com/2011/06/13/larry-summers-economy-is-sick_n_876106.html

  15. Banksters of Amerifraud ‘Significantly Hindered’ Federal Investigation, U.S. Official Says
    Why am I not in surprised?

    http://www.huffingtonpost.com/2011/06/13/bank-of-america-significantly-hindered-federal-investigation_n_876408.html

    Neil Garfield you are a real American Hero.

    Neil Garfield is a real Hero period.

    NEVER AGAIN

  16. is there a cause of action against a foreclosure-mill law office if they created (drafted) the unsupported assignment and subsequently filed said assignment without any poa? knowingly submitted the fraudulent affidavits of ownership?

    any risk to naming said law firm as defendants?

  17. OKAY, HERE WE GO:

    TODAY—6/13/2011 ON THE DYLAN RATIGAN SHOW— Gretchen Morgensen and Josh Rubin—authors of bestseller “Reckless Endangerment”—talk about Wall Street’s/bankster’s involvement in mortgage nightmare and how New York Attorney General is FINALLY doing a REAL investigation—good stuff—don’t have video to link here yet—

    Neil—some VERY important things said on the show today—please find it when available and write a post—VERY IMPORTANT that this was on a NATIONAL show!!!

  18. Dear CHAYO BRIGGS,

    Sincerely, can we get Nancy Grace on the case? A Reality TV Show (like Judge Judy) where you can take your case and have analyzed by legal minds. Where are the producers? How do we get the best legal minds case by case to bring into the light of day the truth?

    Not one size fits all. Case by case unique based upon who, what, when, where, why, how.

  19. I second that, E.Tolle.

  20. Zoe,
    I noticed the same thing you did. That’s exactly what I’ve pointed out in my case–i.e., that the MERS assignment was done as the nominee of a lender who claimed to not be the Note Holder at the time of the assignment, with the party that DOES now claim to be the Note Holder not mentioned in any of it. How’s THAT for prima facie evidence of fraud?

  21. @ tnharry,

    I’m not talking about different issues. The court said:

    “OneWest can simply change counsel and then be less than candid with a new set of attorneys.”

    Does that absolve the attorneys from the dilligence of knowing that they are or aren’t being factual in their pleadings? If so, then this is the major blurring of the lines of fairness when it comes to attorneys v. pro se. A pro se can’t fall back on the old line, “That’s what the banker told me your honor, really!” Instead, it’s all first person….it’s either true or false, with possible dire results.

    I’ve had it with the double down of the banks. You know, I know, the courts know, the legislators know, the regulators know, WE ALL KNOW IT’S NOTHING BUT DECEPTION! Three card monty. The trust has the note, now they don’t. Now the trust doesn’t, because we do. We can foreclose even though we already sold the loan, because we never delivered on the contract. Switcheroo….all games and deception. what a tangled web, and capable of imploding our entire planet, all for greed. Screw them all.

  22. Zach Carter

    Bank Drops Legal Assault On Foreclosure Fraud Expert’s Family [Lynn Szymoniak]

    http://www.huffingtonpost.com/2011/06/13/bank-drops-legal-assault_n_875868.html
    Comments
    | Foreclosure Crisis

  23. Speak of the devil….

    Mers….

    http://www.scribd.com/doc/57764888/Bank-of-NY-v-Silverberg

  24. @E Tolle – two different standards. I’m referring to being bound by the same rules of pleading and procedure. As to the other standards, we should all be bound by the same, I agree. However, don’t blend the acts, actions, and responsibilities of the attorney and their client. I’m not liable if my client takes the stand and perjures himself. I do have a problem if I suggested he do it or if I help him do it knowingly.

  25. Let’s not overlook another good part of this:

    A further evidentiary anomaly arises on account of the Assignment; MERS executed this document as a nominee for the Original Lender. But the allonge to the Endorsed Note makes clear that the Original Lender assigned its interests in the Note more than three years prior to execution of the Assignment. And rights under the Trust Deed follow the Note. Polhemas v. Trainer, 30 Cal. 686, 688 (1866). Thus, MERS’ purported assignment of the Trust Deed and the related note as nominee for the Original Lender and without a reference to either IndyMac Bank, FSB or Freddie Mac APPEARS DESIGNED TO DISGUISE RATHER THAN TO ILLUMINATE THE FACTS.

  26. “The fundamentals of the whole economic condition are divine in nature and are associated with the world of the heart and spirit…” “The disease which afflicts the body politic is lack of love and absence of altruism…”

    above quote from this site:

    http://info.bahai.org/article-1-3-2-15.html

  27. E. Tolle–great point. If attorneys submit false documentation into evidence and get away with it, why can’t a pro se? Because, as Leonard Cohen put it so well–“Everybody knows the dice are loaded, everybody rolls with their fingers crossed…” Oh, and from the same tune: “Everybody knows the fight was fixed, the poor stay poor and the rich get rich–that’s how it goes, and everybody knows.”

    Unfortunately, it seems pro se litigants are in fact held to a higher standard than attys…

  28. @ tnharry,

    You said, “I’m saying that pro se folks are held to the same standard as attys with regard to procedure and rules, so you’d better be well-versed in both the rules and the law itself.”

    What I don’t understand, and as it applies to the above case, it’s my belief that if a pro se were to go into court with false, perjured documents, he/she would be shown the door, of a federal penitentiary.

    The judge reflects that the bank (through its attorneys mind you), “stated under penalty of perjury”, “OneWest, of course, is obligated to provide only accurate information”, “failure to provide the Endorsed Note prior to the close of evidence”, “….further evidentiary anomaly arises on account of the assignment…”, “appears designed to disguise rather than to illuminate the facts”, “…failed to tell the true and complete story”, “….is more important than complete candor with the courts”, “less than complete information….”, “were neither candid nor credible”, “failure to respond timely “, “submitted multiple and different notes as “true and correct”, “inconsistent evidence”, “OneWest did not obey the rules”,

    I could go on….the point is, if this is the standard you’re referring to when you state that pro se’ers need to rise up to, well, maybe that explains the deep shit we all find ourselves in as we speak. For the courts to not only put up with actions such as these, but basically bless them by ruling without prejudice speaks volumes about where we’re at, how we got here, and the heaping of pain just ahead of us.

    The fact that the court determined that there was no reason to go after the attorneys who pled this crap shows a weakness and further breakdown of law and order. The fact that the court allows this knowing that next week, it will just be fresh lying faces ignoring the law in front of the bench doesn’t say much about the standards you refer to.

  29. Amazing! But why give OneWest an opportunity to “correct” its documents? It has already offered two false sets. I’d the borrower had offered even the tiniest bit of falsehood, he’d have been clapped in irons (figuratively, perhaps)…

  30. Sorry about this long post—but the transcripts excerpt below from Piers Morgans’ interview with “Mr. Wonderful” Jack Welch is STUNNING:

    (from Piers Morgan Tonight, June 8th 2011)

    MORGAN: President Obama expressing faith that the American economy can turn around.

    Do you share his faith, Jack?

    WELCH: With the right policies, certainly do. I think the American spirit is alive and well. And we just need a clear direction, where everybody can get in line to follow it, including the government and the private sector.

    MORGAN: When you retired and you left G.E., five, six, seven years ago —

    WELCH: Ten.

    MORGAN: Ten years ago. Really as long ago as that? Wow.

    WELCH: Yes.

    MORGAN: So, 10 years ago.

    WELCH: Yes, I mean, 10 years. MORGAN: It’s a long time, isn’t it? It feels like yesterday, Jack.

    When you left 10 years ago, everything was riding high. And G.E. was fantastic. You’re going from $14 billion to $400 billion. America was riding high. Everything was looking great.

    What went so catastrophically wrong that meant that we had this terrible financial crisis?

    WELCH: So many things can be attributed to what caused the problem, but certainly lots of money available too easy. When smart people have too much money floating around too easily, the risk premium has gone out, out of bets.

    MORGAN: Is that because greed kicks in?

    WELCH: No, I don’t think it’s so much greed. I think it’s everybody sort of free wheeling it. For example, we had the Congress saying everybody should own a house. We had Fannie and Freddie supporting that.

    We had mortgage bankers out people things. We had Wall Street dreaming up new instruments, SIVs and things like that we never heard of before.

    We had — everybody had a piece in this. Everybody.

    MORGAN: Who was most to blame?

    WELCH: Boy, that’s a hard one. I mean, you can — well, you can blame the consumer for getting a house they didn’t have with no responsibility. You can blame Wall Street for pushing it. I really can’t pick one.

    (CROSSTALK)

    WELCH: — by the Wall Street.

    MORGAN: If you were CEO of America PLC or Wall Street PLC, and you were doing your 10 percent rule, who would you have fired? I mean, who were the main culprits here from a business perspective?

    WELCH: Well, I would have cleaned out anybody in the mortgage business who put faulty mortgages together. I would have put in people that were putting together faulty paper. I would have cleaned out everyone of those people that were falsifying their applications as to their ability to pay. I mean, there’s a series — there’s an army of people —

    MORGAN: Should some of these people have gone to jail?

    WELCH: I’m not — I’m not qualified to pick that, whether that’s true or not. I don’t know enough in the details of that. I honestly don’t, Piers, I tell you.

    MORGAN: But when you talk about falsifying paperwork, can it be — WELCH: Consumers do that all the time. I mean, when we just had this thing in the — this oil problem in the Gulf. Ken Feinberg talks about all the false paper he got, with people claiming that lived in Maine, they had a problem with the fish in their restaurant. And everybody put in a claim.

    I mean, that’s just life.

    MORGAN: So, you weren’t saying that people in Wall Street itself were falsifying stuff because that is —

    WELCH: That’s wrong.

    MORGAN: That has been suggested, that many of them were.

    WELCH: No, I’m not saying that. I’m not —

    MORGAN: They were playing with paperwork and it wasn’t real money.

    WELCH: I’m not sure it’s true. They were putting together instruments and selling them through a public that was buying them. Was that right or wrong? I don’t know. I don’t know if it’s illegal or not, Piers. I’m not — I’m not capable of answering that correctly.

    MORGAN: If you’d been running Goldman Sachs, would you have allowed the multimillion dollar bonuses to be paid out after the bailout for the next few years?

    WELCH: Look, there’s a culture in Wall Street, I own (INAUDIBLE) — which is one of the worst moments in my life.

    MORGAN: But you got rid of it.

    WELCH: Yes, because I couldn’t manage that system of bonuses. We had a trader who did something illegal. I had to go down there on a Friday night and work the weekend with a crowd to find out what went wrong.

    Well, I went to the men’s room. I’m in the men’s room standing next to a trader. He said to me, we had a $4 million fraudulent play. He said, this won’t hurt my bonus, will it?

    MORGAN: All he cared about.

    WELCH: All he talked about. It’s a culture. It’s a culture. I wasn’t able to manage it.

    MORGAN: But let’s take this culture for a moment because many say it was precisely this culture collectively across all the people you’ve talked about which led to the crisis. The culture nearly brought down — it brought down Lehman Brothers. It could have easily brought down Goldman and others.

    They were bailed out. And the moment they got back on their feet, having been bailed out, the first thing they did, from my perspective, was stick their noses straight back in that same trough.

    WELCH: And if they didn’t, guess what those people would have done? They would have gone to the British banks and to the other banks, Hong Kong, Shanghai Bank, Deutsche Bank and everybody else waiting to steal their people.

    MORGAN: Unless the global banking community —

    WELCH: All took an oath and said, “We will stop bonuses.”

    MORGAN: No, unless governments all around the world, when they orchestrated these bailouts, said, “We’ll bail you out and you will all sign up to no bonuses for the next five years.” Why couldn’t they have done that?

    WELCH: Why didn’t the government do that?

    MORGAN: Should they have done it?

    WELCH: Well, I mean —

    (CROSSTALK)\

    MORGAN: — big defender of —

    WELCH: I don’t like the government doing it, OK? So I’m not going to get drabbed into that one, OK?

    MORGAN: But it’s interesting that you even hesitate, because you’ve been a big supporter previously, I’ll grant you that, of allowing people to be paid what they should get in the marketplace.

    WELCH: I do.

    MORGAN: And that includes bonuses. But this is different. This is where these companies have been bailed out by the taxpayer. It’s a different scenario.

    WELCH: No, I’m giving you that point. I’m giving you that point that they should have been more cautious. But they had a competitive playing field again. And you’ve seen it.

    MORGAN: They only had a playing field at all because they were bailed out.

    WELCH: But they still had to stay in business. They had to stay in business.

    MORGAN: You don’t have to reward yourselves multimillion-dollar business bonuses —

    (CROSSTALK)

    WELCH: You better award your investment banking team. You better award your best traders. Or somebody else will take them. That’s the system down there. MORGAN: Yes, but that’s what I mean about had there been a global —

    WELCH: Oh, yes. I’m not arguing —

    MORGAN: — crackdown. If they all got together, we’re all in this together. There wasn’t a country (INAUDIBLE) actually it’s not true.

    WELCH: Canada did a nice job.

    MORGAN: There were countries that didn’t. But, actually, collectively, if they’d all gone in together and said, right, here’s the deal, yes, we’ll bail you out, no, you can’t have bonuses for five years for anyway. So, there’s no trading around.

    WELCH: Let’s not make it five years.

    MORGAN: Three years. Something. What I hate is you’ve got millions and millions of Americans who have lost their home, who have lost their jobs, who have lost their security, who can’t feed their children, and they’re having to read in their newspaper — one of the few things they can afford still — they’re reading or seeing on television about these bankers and all they’re thinking is: these guys got us in the mess. We bail them out. And now, they’re making millions again and I don’t have a home or a job.

    WELCH: And I don’t blame them for being mad as hell.

    MORGAN: It’s wrong, isn’t it?

    WELCH: Seems to be. You won’t get me arguing that case. I don’t buy that case. So, but I know — I do know that unless you got everybody, you sink this company and that company because that culture will move people to where the action is.

    (end of excerpt)

  31. Tnharry,

    Again lawyer represent you when you are pro se you present yourself. You can not represent yourself no wonder someone pro se loses. They are trying to speak in 3rd person. Presenting yourself is all a person can do. The famous saying “a person that represent himself has a fool for a client” , make sense. Your acting like you have a split personality. No wonder the first thing the judge ask is when a person goes pro se is do you have any mental illnesses.

    You present yourself everyday, when you talk to someone why would you change that in court and say I am representing myself? It doesn’t make sense. Also judges can not hold pro se the same way as a lawyer and there is case law to prove this.Pro se has constructional rights that are in place because a natural person is speaking not an officer of the court working in a corporate fiction where some of constitutional rights are not given to a corporation. Example when a lawyer says Joe Smith from the office of Smith and Smith LLP representing Mike Dumass they are saying there in corporate form not personal. Even though I will agree they try to and a lot of pro se litigants lose because judges want to help keep lawyers employed.

    If pro se litigants won a lot of there cases why would anyone want a lawyer for? Check History when this country started everyone said they was an lawyer so they could handle there own affairs as it should be.The is why a lawyer is different from an attorney. (read the definition in bouvier law) Only later with the Bar coming into play did things change to keep the elite the elite, but that’s a whole other concept that I wont even go to on here.

  32. Please Sign the Stop Foreclosur e Now Petition!

    Send this Petition to at least 5 People and ask that they do the same!

    http://www.ipetition s.com/peti tion/smoke andmers911 /

  33. Please Sign the Stop Foreclosure Now Petition!

    Send this Petition to at least 5 People and ask that they do the same!

    http://www .ipetition s.com/peti tion/smoke andmers911 /

  34. @Tony – explain to Chayo and all the others others how filing pro se “doesn’t hurt you in any way.” Re-read my comments. I’m not demeaning pro se or saying not to do it. I’m saying that pro se folks are held to the same standard as attys with regard to procedure and rules, so you’d better be well-versed in both the rules and the law itself. Pro se can be great if you are equipped to do it. No atty, no matter how well educated or prepared, will ever know your case and your facts the same way that you do. And being fully in control of deadlines, decisions, etc. is a huge benefit of representing yourself.

  35. @carie – as to your questions about “when does it end” – it ends with a final decision on the merits somewhere. We keep being fed posts from the various blogs that claim to vindicate the beliefs and theories espoused here and on other sites that are nothing more than procedural, interlocutory issues. On this one and most of the other victories, the creditor can and will come back again. Hopefully soon we will have some real decisions that provide guidance one way or another.

  36. TnHarry,

    Filing pro se does not hurt you in any way. Being uneducated is the reason why people lose period. When lawyers lose it is because of the samething education. I hate when people say don’t represent yourself. For one you don’t represent yourself, you present yourself. You get represented when you have a lawyer. You present yourself when your pro se.

    As for Onewest, DBNTC vs FDIC kills everything they do in court period , and that they can never have an original note. Also again if people would read U.S. Supreme Court case Freeman v. Alderson, 119 U.S. 185 (1888) lawyers and pro se would understand jurisdiction and the no bank has In Rem rights. This is the same judge that ruled on the case all judges and banks use Long v. Bullard, 117 U.S. 617 (1886). I suggest everyone read Freeman very carefully.

  37. I’m not making fun of pro se by any stretch. Hiring an attorney is often better, not always, but certainly not possible for everyone. Using the resources available here and on other websites to your benefit, using Legal Aid, local law schools and students, these are all great options. Competent legal representation is the best, but you can approximate that with enough research and effort. My point to Chayo was not to single out that Judge as being part of the fraud and civil rights violations. He was merely applying the law and rules to what he had before him. Many of the commenters on this site appear to be representing themselves more than adequately without being represented by attorneys.

  38. tn—And what is a person with NO job and NO money ( thanks to the FRAUD and subsequent economic downfall), supposed to do—give up and go steal a tent??? You say “no pro se”—BUT SO MANY PEOPLE CAN’T AFFORD ATTORNEYS!!!

  39. tnharry—where/how does it end??? Obviously, it’s not their job description to “throw up their hands”, but what can they come up with next??? And next? And after that???

    All I can say is THEY DID IT TO THEMSELVES!!!

  40. Chayo – I looked at your docket report using PACER. Don’t blame the judge for your result when you filed pro se. You had to expect to be out-lawyered every step of the way. Your initial complaint was not a complaint at all, and you were allowed 2 amended complaints before dismissal. Proceeding pro se went farther to violate your civil rights than the judge did unfortunately

  41. It all sounds great and is strongly worded in places, but the denial was without prejudice, so they’ll come back again….

  42. Why is it okay for banks to get (Blank Assignments/ No Original Notes, illegal foreclosures, fake documents etc) away with Mortgage Fraud and why do the State and Federal courts have corrupt Judges and Lawyers. There are corrupt federal judges in the US District Court Los Angeles.

    It is unclear why Hon. Philip S. Gutierrez violated my civil rights and issued ruling on a case with prejudice without hearing the case because several documents of evidence was submitted to the court.

    However, Gurierrez ignored the truth and it is unfair and it’s illegal and The United States District Court, Central District of California court system is taking advantage of citizens because Judges continue to avoid (Banks) allegations of Mortgage Fraud and their misconduct of the justice system continues to fail citizens and there is no purpose of citizens relaying on the courts to make the right decision and get a fair trial because of the injustice of the court system.

    click this link
    http://dockets.justia.com/docket/circuit-courts/ca9/11-55940/

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