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Southern Essex Registry of Deeds Audit Reveals That 75% of Assignments of Mortgage Are Invalid; O’Brien Says Banks Responsible for an Epidemic of Fraud. Once again urges Attorney’s General to stop Bank settlement talks

Posted on29 June 2011.

Southern Essex Registry of Deeds Audit Reveals That 75% of Assignments of Mortgage Are Invalid; O’Brien Says Banks Responsible for an Epidemic of Fraud.  Once again urges Attorney’s General to stop Bank settlement talks

Commonwealth of Massachusetts

Southern Essex District Registry of Deeds
Shetland Park
45 Congress Street
Suite 4100
Salem, Massachusetts 01970

Register of Deeds

Salem, MA
June 29th, 2011

Kevin Harvey, 1st Assistant Register

Marie McDonnell, President, McDonnell Property Analytics, Inc.

Yesterday at the Annual Conference of The International Association of Clerks, Recorders, Election Officials and Treasurers (IACREOT), Register John O’Brien revealed the results of an independent audit of his registry.  The audit, which is released as a legal affidavit was performed by McDonnell Property Analytics, examined assignments of mortgage recorded in the Essex Southern District Registry of Deeds issued to and from JPMorgan Chase Bank, Wells Fargo Bank, and Bank of America during 2010.  In total, 565 assignments related to 473 unique mortgages were analyzed.

McDonnell’s Report includes the following key findings:

–          Only 16% of assignments of mortgage are valid

–          75% of assignments of mortgage are invalid.

–          9% of assignments of mortgage are questionable

–          27% of the invalid assignments are fraudulent, 35% are “robo-signed” and 10% violate the Massachusetts Mortgage Fraud Statute.

–          The identity of financial institutions that are current owners of the mortgages could only be determined for 287 out of 473 (60%)

–          There are 683 missing assignments for the 287 traced mortgages, representing approximately $180,000 in lost recording fees per 1,000 mortgages whose current ownership can be traced.

McDonnell told O’Brien, “I have been auditing residential mortgage loans for the past twenty years on a one-by-one basis.  In the process, I have been cataloging the ramp up in predatory lending and mortgage fraud for all of those years, but I was not prepared for the shocking results of my audit.  What this means is that the degradation in standards of commerce by which the banks originated, sold and securitized these mortgages are so fatally flawed that the institutions, including many pension funds, that purchased these mortgages don’t actually own them because the assignments of mortgage were never prepared, executed and delivered to them in the normal course of business at the time of the transaction.  In a blatant attempt to engineer a ‘fix’ to the problem, the banks set up in-house document execution teams, or outsourced the preparation of their assignments to third parties who manufactured them out of thin air without researching who really owns the mortgage.”

O’Brien asked McDonnell what this means for his constituents.  “It is vitally important for your constituents to know that if they are in foreclosure now or if their homes have been foreclosed upon, they can stop the foreclosure from proceeding, or institute a court action to vacate a completed foreclosure. The Massachusetts Supreme Judicial Court has established the law of the land in its decisions U.S. Bank, N.A. v. Ibanez and Wells Fargo Bank, N.A. v. LaRace and I can tell you that every single assignment of mortgage that was recorded for the purpose of foreclosing the homeowner is invalid, overtly fraudulent, or criminally fraudulent. My findings also show that your constituents who are not in foreclosure, and have never been delinquent in their payments also have clouds on title due to the recording of defective and invalid discharges and assignments of mortgage.”

“My registry is a crime scene as evidenced by this forensic examination,” stated John O’Brien. “This crime that has affected thousands of homeowners in Essex County who, through no fault of their own, have had their property rights trampled on and their chain of title compromised. This evidence has made it clear to me that the only way we can ever determine the total economic loss and the amount damage done to the taxpayers is by conducting a full forensic audit of all registry of deeds in Massachusetts. I suspect that at the end of the day we are going to find that the taxpayers have been bilked in this state alone of over 400 million dollars not including the accrued interest plus costs and penalties. The Audit makes the finding that this was not only a MERS problem, but a scheme also perpetuated by MERS shareholder banks such Bank of America, Wells Fargo, JP Morgan and others. I am stunned and appalled by the fact that America’s biggest banks have played fast and loose with people’s biggest asset – their homes.  This is disgusting, and this is criminal,” said O’Brien.

O’Brien continued “Once again I am asking Attorney General Martha Coakley and the other state Attorney’s General to follow the lead of New York Attorney General Eric Schneiderman and stop any settlement talks with the banks. The results of this report are only for my registry, but I can assure you that this type of criminal fraud is rampant across the nation. This leaves me to question why anyone would consider settling with these banks until we know the full extent of the damage that they have caused to the homeowners chain of title across this country and the amount of money they have bilked the taxpayers for their failure to pay recording fees.”

The Full Report is included with this release and may also be requested at www.mcdonnellanalytics.com.

31 Responses

  1. Gotta say the ohio Attorney general is interested in this.

  2. My home of 20+ years will be sold at Trustee’s Sale in two weeks, but I’m no longer angry because this ceases to be a country I recognize when the Poor and Middle Class are suffered to bail out the filthy rich. We’re headed for a class war of epic proportions, so you’ll have to excuse me while I prepare my body for a


  3. On 6/17 I was informed all of our hamp documents were finally in and our point of contact said she gave them to her supervisor. On 6/24 I recieved mail from Wells Fargo, dated 6/22, that our hamp loan would be disqualified if they didn’t get the documents that were missing. ( there was no list, of course, of the documents that they needed). I immediately called my single point of contact at W.F. and informed her of the letter. She appologized for the letter saying she knew nothing of this document. (I have all this recorded btw). I was told to await the hamp decision on 6/25 by my Single Point Of Contact(S.P.O.C.)-(beam me up scotty). On 6/30 I was contacted by my S.P.O.C. and informed we qualified for the unemployement mortgage program, to our surprise, becuase my wife is on unemployment and there is no W-2. (this IS recorded). I explained to her that this was possibly fraud becuase my wife had filed a 1099 stateing that she worked for an employer part time while she collected the balance in unemployment. My S.P.O.C. was basically telling us to Lie to wells fargo and all other involved parties. If W.F. has all the hamp documents, including 2010 tax returns and the 1099 form from my unemployed wife for this year, shouldn’t they have known we did not qualify for this NEW loan my S.P.O.C. was trying to sell us? If what she said is true, and they have all of our documents….isn’t this some kind of fraud. She certainly claims, on tape, that we still havent been turned down by hamp, and that I need no more paper work, and this back dates all the way to 6/17. I’ve certainly caught them in a lie and I have it documented. What is my recourse if any?

  4. BOTTOM LINE: Who is the creditor? Who owns my “loan”? PROVE it!
    They have NO STANDING—NOT HOLDER IN DUE COURSE. No conveyance to a “trust”…no conveyance=no possession.

  5. rdewayne- thats what im trying to figure out. the foreclosing attornney in my case has a backroom employee who signs off as a mers officer and assigns the notes/mortgage from mers to other entitiies , who just happen to be represented by that law firm, who then begin foreclosure. it seems like this practice shouldnt be allowed. essentially the attorney is creating evidence for their client in a backroom. this doesnt make any sense.

  6. I would like to know if an attorney for a foreclosure lawfirm can transfer an assignment of note and deed of trust. His other title is assistant secretary of Mers with respect to Mers guidelines gives him the authority.

  7. im trying to figure out what your saying. what did i deny? lol your nonsensical rant has me scratching my head.

  8. It really irks me when people such a dan-o below deny that any action can and will help correct what has been done to the American middle-class for the past 20-25 years. Why is it that, of the same people we elect (Attorneys General, governors, representatives, senators, presidents, etc.) we flat-out declare: “They do what they want, they enrich themselves on our back, they eat out of the banks’ hand and we can’t remove them from office or make them do anything”?

    Like hell, we can’t! Those people serve US. Not the other way around. They’re accountable to US. Not the other way around!!! It doesn’t matter what party they belong to. The idea is much more simple than that: do they like their job? Do they want to keep it? Then there are certain things they must deliver. That’s what everyone else has to put up with. Why not them? What makes them so different from us? If I want to be paid, I’d better deliver what the client wants. Public servants have the same obligation toward me.

    Print that livinglies report, send it to your state representatives, governor, property recorder and attorney general with specific questions: was an audit performed, how much revenue was lost by the state and what will be done to recoup the money, how soon the necessary actions will be taken and to please keep us posted on the new developments in writing and on the state’s websites. If no audit has been performed, then demand one immediately. Demand that congress make it mandatory for every state recorder’s documents on a regular basis and impose hefty penalties on mortgage servicers who fail to obey the law.

    Let’s make it really painful to them not to obey the law. Let’s make it incredibly more painful for them to disobey and their ways will change in no time.

    This is OUR country. This is OUR money. How can 1% of the population intimidate 99% into sitting on its hand, bowing down to fear and doing nothing? This thing about whining and complaining and doing nothing is really getting to me. Quite frankly, to people who refuse to fight: stop complaining. Get off your fanny and start acting. You don’t like what is happening? Change it! Learn how and do something! And if you don’t act by simply spreading the info from livinglies and posting it to facebook and forwarding it everywhere and to everyone you know who could use it, they I don’t want to hear from you.

    For those who believe that taking action is already 80% of the win, start moving and contacting people we elected, republicrates and democans alike. We don’t care what party they belong to and how they feel about our having a black president (since 2008, this has been the sole crux of all American politics! Race. Nothing else. Not enforcing the law, not fixing the economy, not restoring the middle-class, nothing. Just plain race! How sad, pathetic and shameful!)

    We want action and resolution for the 300 millions residents of the country, red, white, pink, brown, yellow and whatever other color. If public servants want to fight the president because he happens to be a little too ethnic for their taste, let them do it on their own dime. Not mine! And if they won’t do the job they get paid for, let’s fire them and hire some who will!!! With 10% unemployment in this country, we’re bound to have qualified people who will be grateful to be elected and will do the job better than those currently sitting in government and congress.

    The alternative is not enjoyable: it will simply be an unavoidable, bloody civil war we’ve been heading for for 10 year. Open any history book: when enough people have suffered long enough at the hands of a very few, that is what happens. ALL THE TIME, everywhere. This is an absolute truth. Is it what we want?

  9. slightly off topic, but in an earlier article neil had said to ask for your closing documents, and in those documetns you should see the lenders “closing/escrow instructions” in example: to whom the attorney is to return the funds should you walk away from the table before closing or if there is an overpayment. those funds would have to be returned to the source of the funding. these docs show who the real lender is and where the funds came from. i got on the horn with my closing attorney and specifically asked him for the documentation showing me where the funds came from. he flat out denied me access to it, and said this isnt part of my file, its part of his file with the lender and therefor is confidential. bull$#%!. i explained to him that if the source of the funds is the same as the lender listed on the mortgage, then showing it to me would make no difference because i already know who the lender is. the only way it would make a difference is if the source of the funds wasnt the same entity named as lender on the mortgage. the attorney did nothing but dodge my questions and would not give me the info. interesting indeed. im wondering if the closing attorney knew all along that the source of the funds wasnt the “lender” on the mortgage contract. why wouldnt he show me this? am i entitled to see it? and i believe neil is right, if the source of the funds is different than who the lender is named on the mortgage, then the deal never happened. how could it be? your borrowing money from an undisclosed party and a straw man “lender” who didnt put up a dime is named as lender on the mortgage? what the holy hell is going on here. i think my attorneys reluctance to show me the docs is proof positive this happened. any thoughts?

  10. yes carrie, albit law thinks its to big to fail, they need reminder that forclouser mill attys are being sued and mass residents will be suing and winning. I am in hopes that all registrys across the commonwealth will pick up on allowing home/land owners to challange the recorded documents of ill fate on record. Imagine the time, expense and expoltation that this would remove as the home/land owner could extnquish the fraudulent forclouser, assignments, mortgages ect that cloud our titles and never set a foot in court. This would be a mainstream effect on regaining the economic boost that we need. Lets go, just do not allow refiles, that is my only beef.

  11. […] Livinglies’s Weblog Filed Under: Foreclosure News Tagged With: crisis, foreclosure, housing, News, real […]

  12. The “house of cards” IS coming down…albeit too slowly.

  13. lets face it, the AG’S arent going to do squat. the banks have long arms and deep pockets. politics wont allow the AG’S to do anything which is fair and equitable to the victims/homeowners. the AG’S are doing the banks bidding, creating the illusion they are acting on behalf of consumers. people like john obrien is who we need. someone from the middle of the pole barking loud enough for the top to hear those on the bottom. we need more john obriens to get momentum. hes already gotten the ball rolling. lets face it, the report is accurate. does anyone believe the auditor or obrien would put their reputations and possibly careers on the line if there was a shadow of doubt? seriously? the problem is government is affraid of what will happen when the house of cards comes tumbling down. “too big to fail”, remember those words? if all of the banks involved were prosecuted and held accountable they would all be gone. they couldnt afford to pay the damages, restitution, legal costs, etc. they want to pay pennies on the dollar to the investors they swindled and steal the property of the homeowners they defrauded. its unreal. this is disgusting.

  14. TN,

    What parameters are being used to make these claims? Is it based upon legal standards, or is it based upon what he and others perceive to be an issue, but there is no true legal standard that has been established in court rulings or statutes?

    Is it applicable only in MA?

    One cannot just accept the findings of a person without understanding what parameters were used to produce those findings.

  15. You folks seem to be missing the point that the allegations being made here aren’t O’Briens, but those of Marie McDonnell, who some have said was instrumental (Max Gardener) with her amicus brief that the court relied upon in the Ibanez case. They are in the form of a sworn affidavit, which we all know just how admissible those are, as who hasn’t seen a lost note affidavit?

  16. he’s been rejecting already. i would think he can’t strike from the registry though absent court order

  17. He’s a courageous man

    Can he reject documents to be filed. Or already fled?

  18. “O’Brien continued ‘Once again I am asking Attorney General Martha Coakley and the other state Attorney’s General to follow the lead of New York Attorney General Eric Schneiderman and stop any settlement talks with the banks.’ ”

    Does anybody know if he has also specifically asked AG Coakley to investigate / bring charges in connection with his findings?

  19. tnharry, your right, only the courts can rule on it. but when mr obrien walks in with a forensic audit doing his duty as the keeper of the land records for his county, who do you think will prevail? i believe the state has greater legal resources than the banks. judges dont look to kindly on defrauding the state and the taxpayers/homeowners, especially in these numbers. the sheer amount of fraud is mind boggling. do you know why they did it or still do it? because they could, thats why. they have their hand caught in the cookie jar and while they try to pry it loose under the watchful eye of the government their other hand is still stealing away with impugnity. theyre nothing but thieves in the night. period.

  20. Generally he wouldn’t have standing to sue for others, but he might be able to frame some claims he could assert that would benefit others. All he really needs is to make himself available to one plaintiff and a good class action lawyer.

  21. Could he sue on behalf of the good citizens of Essex county?

  22. ok dan-o, we’ll have to agree to disagree i suppose. Mr. O’Brien can say anything, but only a court can rule on it and enforce it.

  23. Unfortunately, and reluctantly I agree with tn. Obrien gets my vote for president but his pronouncements seem toothless

  24. i highly doubt obrien would be standing up making these types of accusations if they werent substantiated. and no offense, but i take what you say with a grain of salt. you had rebutted me on another thread stating a private citizen cannot file criminal charges and you were dead wrong. any citizen can, at least in massachusetts. anyone can file a criminal complaint and a magistrate holds a show cause hearing to determine the merit of your complaint. if it has merit, it moves forward to prosecution by the DA and trial. if not, then its squashed. the DA isnt the only who can bring a criminal complaint.

  25. Dan-o, he can make the statements all day long, but they have no real effect. Only a court can say whether they are valid or invalid, fraudulent, or violate statute. Everything else is merely his opinion. It may be a very learned opinion, but still opinion. And a title exam or title opinion isn’t analagous. The title insuror takes a risk, albeit a calculated risk, based upon the title review conducted by their agent and issues a policy.

  26. Everyone should make sure to send emails of this letter to all clerks, AG’S across the country. And i am glad to see that MR O’Brien, has the courage to uphold the law.

  27. tnharry, he can make these statements because he has the opinion of a professional forensic loan auditor/title examiner. mortgage closings are done everyday on the opinion of title examiners who give the title a clean bill of health. the lenders and title insurers trust the opinions of title examiners to the tune of billions in executed mortgage contracts, but obrien shouldnt? give me a break. obrien is leading the charge and proving these banks are the lying cheating pond scum everyone knows they are. mers is the vehicle for the fraud. period. the house of cards is falling down. its too bad you cant see it for what it is. maybe when the banks send their knuckle scraping goons to put a foreclosure sign on your lawn when you owe the bank nothing will you wake up. just maybe.

  28. this could mean one of two things. 1, someone higher up is going to tell obrien to back off because the banks are in their pockets or 2, this is the beginning of the end. i hope this is the latter. i live in mass, and through my own investigation regarding my title have found hundreds of fraudulent documents recorded in our registry.
    heres a question: how can mers purport to be acting on behalf of a lender, as their nominee, when the lender was dissolved in bankruptcy several years before the transaction? another question: how can a foreclosure mill law firm employ someone who is a mers “assistant secretary and vice president by corporate resolution”, then have this person draft documents as a mers employee which the foreclosure mill then uses as evidence for the their clients foreclosing on properties? this is unreal. these foreclosure mills are using mers to fabricate and manufacture evidence for their clients. i have seen it dozens of times. isnt this illegal somehow? i mean if an attorney was allowed to manufacture evidence for their clients we’d have no one in jail, and every lawsuit would be a homerun. this doesnt make sense by any stretch of the imagination.

  29. I’m sorry, but these statements can only really be made by a court of competent jurisdiction, not the Register of Deeds :
    – Only 16% of assignments of mortgage are valid
    – 75% of assignments of mortgage are invalid.
    – 9% of assignments of mortgage are questionable
    – 27% of the invalid assignments are fraudulent, 35% are “robo-signed” and 10% violate the Massachusetts Mortgage Fraud Statute.

    That may be his opinion, but it’s nothing more. Great for him that he’s taking a stand and trying to help, but the cynic in me sees a series of prepared sound bites by one guy who clearly has higher political aspirations and another who is engaged in a commercial enterprise doing these audits.

  30. I hope all the state AGs receive a letter from O’Brien.

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