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Salient points of Judge Mann’s Decision:

  1. TRUTH IN LENDING  was dismissed because they were time-barred. LESSON: Don’t ignore TILA claims or TILA audits. Get a forensic Analysis as early as possible, assert them immediately, assert rescission as soon as possible. TILA has teeth, but if you assert it late in the game.
  2. YOU CAN’T FORECLOSE ON UNRECORDED INSTRUMENTS: Judge Mann came right out and said the California Supreme Court would not and could not decide otherwise. Any other holding would defeat the purpose of recording and create uncertainty in the marketplace. This will cause a lot of grief to pretenders. It is getting harder for them to come up with people who are willing to lie, forge or fabricate documents. Getting a notary to affix their signature and seal will soon be a thing of the past unless the signature, the person and the document is real.
  3. THE ASSUMPTION THAT THE LOAN IS IN DEFAULT IS STILL A PROBLEM: As long as lawyers and pro se litigants are willing to concede that the obligation was in default, they are giving up their largest chip — i.e., that the loan was not in default and the loan was not subject to a perfected lien for the same reason that the court cites in its opinion. Our loan level analysis shows repeatedly that in most cases the servicer is continuing to make payments and reporting to investors that the loan is performing even as they send delinquency letter’s notices of default and notices of sales. The Court missed this point because nobody brought it up. Don’t expect the Court to do your work for you. If you have reason to believe that the servicer is still paying on your loan you should be stating that the loan is not in de fault, denying any delinquency to the creditor and objecting to any action that is based upon the premise of “default.” Note that if the servicer is paying your bills, the servicer MIGHT have a right of action against you, but it certainly isn’t under the terms of the note or mortgage.
  4. THE ASSUMPTION THAT A VALID PERFECTED MORTGAGE LIEN EXISTS IS STILL A PROBLEM: Again, the problem is not with the Courts but with the lawyers and pro se litigants who simply assume that this is not an issue. Put yourself in the banks’ shoes. If all you had were nominees for undisclosed principals on the note and mortgage would you be OK with that? No? Then the lien was never perfected, which means for legal purposes it doesn’t exist. Just because it shows in black and white doesn’t make it true. LESSON: Deny the lien exists, deny it was perfected and make them prove how it was perfected. They can’t. In most cases neither the mortgage originator nor the nominee beneficiary (MERS) had a disclosed lender or beneficiary, nor did they incorporate the real terms of  the payment to the investor/lenders. If this was a law school exam and the student wrote that the loan was perfected, the grade would be “F”.
  5. THE ISSUE OF FEDERAL PREEMPTION AND THEREFORE JURISDICTION AND VENUE ARE STILL IN FLUX: This Judge found that federal preemption prevents the homeowner from alleging TILA as state claims. The courts are not decided on this and the issue of res judicata and Rooker -Feldman will come into play once the issue is really resolved with finality. Beware then how you assert a claim and that you don’t let the statute of limitations run out by failing to assert the right claim under TILA in the right court. better to get dismissed than to find out that you are time-barred.
  6. WRONGFUL FORECLOSURE IS A TITLE ISSUE NOT A FAIRNESS OR TECHNICAL ISSUE: Judge Mann, correctly in my opinion, states that an assignment from MERS must be allowed in order to clear up title. But, she states that without recording an interest within the chain of title, you have no right to foreclose under the states recording laws. I think this is right, and I think it applies in all 50 states. LESSON: Plead your wrongful foreclosure, slander of title and quiet title cases as title cases and stop adding extra things that you think may them juicier. Either the title is right or it is wrong. There is no middle ground.
  7. MERS ISSUE IS STILL OBSCURE: While the assignment from MERS, if recorded clears up one part it leaves another part undecided again because it wasn’t raised properly. There is a difference between “bare record title” and an “interest in the land.” The MERS assignment is like a quit-claim deed from someone without any interest in the land and used to clear up the chain of title on paper, but it does not convey any interest. MERS on its website and in the public domain specifically disclaims any interest in the obligation, note or mortgage. That is its selling point to members who use its “Service.” And that is why it can’t foreclose and it is subject to cease and desist orders from regulators. As with other affidavits or quit-claims to clear up apparent clouds on title, the recorded assignment or quitclaim does nothing to convey a larger interest than that possessed by the grantor. LESSON: If the pretenders want to foreclose they can’t rely on the MERS assignment. They must file a credible affidavit that states that the affiant was the undisclosed principal in the original transaction with the borrower and that it joins in or separately assigns the actual interest in the obligation, note or mortgage. In my opinion, this is the only way to perfect the original “lien.” Whether it will relate back to the original transaction is an issue the courts must decide.
  8. NO DIFFERENCE BETWEEN A DEED OF TRUST AND A MORTGAGE: Pretenders who try to elevate a deed of trust above a mortgage are headed for a brick wall. Courts never liked non-judicial foreclosure in the first place. They are not about to to reverse centuries of law and provide higher status to a non-judicial foreclosure or the instruments that allow it. ONLY the statutes that provide for extra care on the part of the trustee are constitutional, since due process is the only way anyone in this country can be deprived of life, liberty or property. LESSON: Pound on the issue that the pretender cannot prevail in a judicial foreclosure so they are trying to get away with it in a non-judicial foreclosure. If you want to see how this will eventually unfold, look at Florida and other states that had similar issues in their “Contracts for deed.” Despite clear contractual language the courts have universally held they are mortgages and that they must be foreclosed as mortgages.

52 Responses

  1. […] on August 23, 2011 at 10:38 am said: Bravo, Judge Margeret Mann. Thank you for doing your job and applying the rule of law. That […]

  2. […] Like this: Like Be the first to like this post. Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor,Mortgage, securities fraud Tagged: | AHMSI, bankruptcy, borrower, countrywide, disclosure,Docx, foreclosure, foreclosure defense, foreclosure offense, foreclosures, fraud, LOAN MODIFICATION, LPS, modification, quiet title, rescission, RESPA, securitization, TILA audit,trustee, WEISBAND « After The Storm – Foreclosure Fraud & Robo-Signing Continues by Nye LavalleJUDGE MARGERET MANN (SO. CA BKR) PLUNGES INTO DETAILS AND COMES UP WITH WELL-REASONED DECISION » […]


  4. “…What we need to focus on is that borrower’s subprime refinance was unsecured — a false and fraudulent mortgage — and nothing more than debt collection on a fraudulent transfer of collection rights to a false default debt. Everyone (in subprime refinance) was in (false) default before they even refinanced.

    The banks (as debt buyers) accomplished this by falsely placing borrower in current default (and never telling them) — and then the servicer purchases the collection rights from either Freddie or Fannie. Then the servicer “reinstates” the false default debt with a fraudulent refinance. And, if there is a subsequent refinance, that is just another transfer of collection rights. Servicer reports original F/F mortgage as “paid” — but it is “Paid-OUT” — by servicer purchase — and not “Paid-OFF” by the borrower as it should have been by the (fraudulent) subprime refinance. . Thus, borrower remains in default on F/F loan – despite a subprime refinance — and borrower can never refinance with an F/F again — They are doomed if they miss even one payment on the false collection rights — and will never recover because always held in default — on both the F/F loan and the collection rights. BUT BORROWERS should not be paying on fraud!!!! They have a right withhold payments on fraudulent debt.

    All fraudulent, all in violation of consumer protection laws — and, because the “creditor” of collection right never validates the “debt” — by disclosing the actual creditor to the false default debt — in violation of FDCPA and May 2009 TILA Amendment. Meaning borrowers should not be paying anything — because of fraud and violation of federal statutes.”

  5. Another one to watch for those of us in California:


  6. Please everyone…

    Send a simple email to NY Attorney General Eric Schneiderman and tell him to PLEASE not back down from the bank fraud (and run for President)!

    He is being intimidated by Obama and the banks.


  7. Merscorp is the electric registration of the live note.

    The note is either cancelled out , divested of value or destroyed upon registration with Merscorp. Look we got IPODS,I PADS,E Books,LapTops,Net Books,Droids,HDTV
    Blue Rey,Auto Electronic Devises…MERSCORP

    1. Merscorp is nearly always the party to THE LOAN DOCUMENTS
    2. The lender sits side by side prima facia with Merscorp
    3. Merscorp is the E-note for identifying “REDRESS” missing in most these cases.

    ISSUES: Ask yourself …why is Merscorp also always “Assigning” the loan back to the originator. Merscorp is the originator!
    And Merscorp is the electronic registration for the successor and assigns? So why the need to comply last minute before the sale takes place.? Because – Otherwise the lender would have to sue itself in a judicial foreclosure.

    Why? Let’s wake up people . Remember the Lost Note ….how long did we have to endure this broad and confusing, yet legitimate claim ? If Mers is the millennium answer to an electronic note , embrace it as you buddy and ask the opposition in court ….If MersCorp is the Note and inst-tracking device to access the registered holders…then :

    1) Why is Counsel for opposition carrying around that copy of the note? According to Mers the note your holding was “tendered”

    2) Who is my loan registered too at this point in time while addressing the court ? Have the court allow you to call MersCorp there at that moment and find out who is perpetrating a fraud against the court.

    3) MERS is the inducement to wrongful foreclosure where you can show the note is “Electronically” live and registered in two places as an ACTIVE file . .. .How if your in court defending foreclosure?

    4) How can the assignment to the statutory trust and trustee be valid when MERS claims the loan was active the entire time of recovery

    “Lender” registers to MERS
    MersCorp tracks ownership throughout the life of loan. Mers will execute one or the other filing requirements for a compliant foreclosure. (Substitution or assignment) .If the loans in recovery it cannot be tracked as performing and if MERS is the note why is counsel running around court with the note .

    Think through your arguments . Its time to look at the MersCorp “Pros and Cons” once again. I say use it to bury the other side….

    Good d’ ay


  8. I don’t quite understand when this all happens in BK court (Ch. 13). My attorney didn’t show up to the hearing and sent an assistant that knew nothing about the out of date order assignments. When we go in front of the judge, do I have a right to speak up if my attorney or his assistant doesn’t?

    I’d change to another attorney in a heartbeat, but this is our 2nd one after the 1st one didn’t know squat and the BAR did nothing. This BK has already cost us $7500 between the 2 attorneys!

  9. Thanks Neil you know we’ve been dealing with Aurora in California and it has been a nightmare, but on the Plaintiff’s side post foreclosure they are slow to respond and I hear the homeowner counsel is looking at Default Judgments against those clowns.

    But meanwhile back in Delaware see how the State started snooping around my journal the same day the Plaintiff filed a counterclaim against M&T bank? Whoa……


    WEDNESDAY, AUGUST 24, 2011

    KingCast/Mortgage Movies Notice of Media Coverage in Wetzelberger v. M&T bank, Thomas P. Dore: The State is watching, will Dore call the police on me as did Phelan, Hallinan & Schmieg?

  10. Comments – I won my foreclosure case a year ago for lack of standing but without prejudice, recently the same firm served foreclosure papers from the same plaintiff. This time they did a corrected assignment, the first was from MERS to Deutsche, this time its from MERS to IMPAC then IMPAC to Deutsche. The signers on the doc. all work for GMAC as well as the notaries.

    IMPAC was a squid wholesaler out of Newport Beach that acted like a New Century with class…..

    Typically we see in foreclosure

    Nominee <> assignment to
    Originating Lender <> assignment to
    Trustee <> Assignee

    Its back to Boyko decision and what you need to do here is focus – this is a fabricated and made to look compliant foreclosure .

    Its what the courts want to see. It is not a true foreclosure and the basis for claims I that I would attack (slam dunk) would be as follows:

    “Why are the parties to the note an assignee?”
    “Why is the Trustee the successor just before sale?”
    “Why is a Trustee holding an asset for over a year which is a breach of his duty and complete negligent act”
    “Why is the trustee appointing a debt collector for a Trust Asset ?”
    “GMAC is foreclosing on NOTHING”

    Get the answers and don’t blow this – Slam Dunk!



  11. @cubed2- thanks for taking the time to inform. You said they said:

    “Plaintiff, or Plaintiff’s assignor, and defendants, and each of them, entered into a written agreement. By the terms of the said agreement(s), plaintiff provided defendants, and each of them, with [services rendered] and/or [goods, wares and merchandise] and/or [extension of credit] and/or [monies paid laid out or expended] …..

    You’re joking, right? They actually said “Plaintiff or Plaintiff’s assignor”?

  12. @Cristine. A DoT isn’t a contract. It’s a grant of authority/powers/rights duties etc…
    There doesn’t have to be a meeting of the minds because only one mind matters.

    However, people signed DoT based on the inducement of a bank. If that inducement was even partially based on a false suggestion it is subject to being annulled. The suggestion that clear title would pass at the end of payments for a loan that goes into the MERS system is FALSE.

    Scire Facia is the legal remedy for that.

  13. “The Federal Deposit Insurance Corp. is focused on brokers that delivered loans to the banks that resulted in heavy losses such as stated-income and no-documentation loans where the incomes of many borrowers were inflated.”

    Oh, FDIC , do spareth me. You know dang well the broker originated loans pursuant to the program guidelines provided to them by the parties to whom they sold the stinking loans. Brokers don’t underwrite loan files, the ‘investor’ does. That’s the word once used by all brokers for the companies with whom they had contractual agreements.
    If this is an attempt by the FDIC to pawn this off on brokers (don’t get me wrong – they were sinners, too, in this mess), that’s just bs. The ‘investors” (CW, BofA), Lehman, M & T to name a few) set the guidelines, sent out product info sheets to the brokers which contained the stated and even no income/ no asset verification
    loan programs to the brokers and then underwrote them based on their own products. This makes it sound like it’s not B of A or CW’s fault. THEY set the loan parameters and THEY signed off on the loan approvals. It’s laughable and disgustingly manipulative. Pretty clear who the FDIC is stumping for. Grrrr….

  14. Also a dime to a donut, no one (as usual) informed the good Judge Mann
    of the real mechanics of a “MERS” substitution of trustee (or a “MERS anything), that is, that it is an instrument executed by a MERS’ member using its own employee and the sub of trustee is done generally long before the assignment of the deed of trust to that member . Take 5000: MERS executes NOthing.

  15. “What is important is that the Court did uphold that MERS could execute the Substitution of Trustee legitimately, through agency or power of attorney.”

    Yep, Judge Mann said that and it’s crap. (No offense, Judge, on account of I like you otherwise). MERS is not an agent. Any agreement which affects an interest in real property must be in writing pursuant to the statute of frauds. It is not enough to try to imply agency (which believe me, MERS did NOT even allege – implied agency – until it deemed it advantageous) to do something regarding real property. Such an agency must be in writing and must be explicit, not implied. I know this inherently (okay, learned it in class) and also found it in a case which of course I won’t be able to locate if history is a clue until after three days of hunting. I’ll post it when I find it. IMO, the judge who made this ruling (in the case around here somewhere) gets contracts, real estate, and the laws of agency believe it or not. It’s the only time I have seen a court take this on appropriately imho.

  16. as M Soliman states, foreclosureinfoseach or something like that——–

    THE PRESIDENT BEN BENACKI and his VP T. Geithner, and their spokesperson B. Obama, prior spokesperson G. Bush, and prior clinton,

    last one of real american for liberty was J. Kennedy.

  17. @Marilyn and others.

    SORRY, very long post, but worth the read and google search yourself the title.

    History of Banking Fraud Chapter 1 – ORIGIN OF THE MONEY POWER IN AMERICA
    The issue between these banks and the people will be joined in the near future, and the greatest struggle the world ever witnessed will take place between the usurping banks on the one hand and the people on the other.
    In the nature of things, unjustly acquired power of man over man generally rises to such heights of arrogance, as to eventually create a public opinion that will grind tyranny of every form to atoms, hence, The Coming Battle that will surely take place in the near future and the victory that will be won by justice will be the noblest events in American history. M. W. WALBERT, 1899
    The Coming Battle
    “Justice, full and ample justice, to every portion of the United States, should be the ruling principle of every freeman, and should guide the deliberations of every public body, whether it be state or national.” – Andrew Jackson.
    During the existence of the human race, from the earliest dawn of civilization to the close of the present century, the power exercised over the industry, property and conscience of man by cunning and ambition has assumed many forms.

    The form of power which first appeared to oppress and plunder the race, was exemplified in those celebrated conquerors of antiquity, who traversed the earth in their bloody careers, transforming blooming fields and rich and populous cities into deserts, overthrowing whole nations, sacrificing on the battle, fields countless myriad’s of their fellow men – merely satisfy a species of madness dignified by the name of ambition.

    Another and a more dangerous form of misapplied power resulted from the intellectual tyranny exercised by that shrewd class, the priest-hood, over the conscience and religious beliefs of the great mass of mankind.

    From the days of the Pharaohs down to this period, man, from his instinctive veneration for a Supreme Being, has been so peculiarly susceptible to the arts, wiles, and cunning of priest-craft to such a degree as to excite universal surprise.

    Those gross superstitions, en-grafted on the inherent religious nature of man, by that wary intellectual superiority, which weighed down the noblest traits of the human mind; which bred bitter religious animosities; unheard of extortion’s by the corrupt and infamous priestly aristocracies of various so-called religions, were the well-matured and craftily-devised schemes for plunder by designing men.

    It is almost inconceivable that the ancient Egyptians, that admirable race, whose noble genius and wonderful energy reared those stately temples, the magnificent cities, and the stupendous pyramids along the valley of the Nile, should worship the man-eating crocodile, the savage vulture, the grinning ape and the crawling lizard.

    This race is an example of that soul-darkening superstition which hung like n pall over the intellect of man.

    The countless wars which afflicted Europe, Asia, and Africa for nearly eighteen centuries; which drowned the finest aspirations of humanity in blood; which desolated the fairest parts of the earth; which stemmed the tide toward a higher and a grander civilization, sprang from the base superstitions originated by the grasping priesthood, who lived in sloth and luxury upon the labor of the deluded mass of mankind.

    The celebrated Vattel, in the twelfth chapter of that noble work, The Law of Nations, awards us a faint idea of the enormities practiced upon the people of Europe by the clergy.

    Taine, in his History of France, shows that the ecclesiastics had seized upon the most valuable and fertile portion of the territory of that country, and that the oppression practiced by them upon the French people was one of the leading causes of the great revolution.

    The third and most insidious and most dangerous form of power that has yet appeared to threaten the material well-being of the race; which new holds every civilized and semi-civilized people in its merciless grasp; which is appropriating to itself the productive energies of the world; which is subordinating the press, the pulpit, and the statesmen of the day to its ambitious ends; which openly boasts of its nefarious methods in the courts, legislatures, and other parliamentary bodies of nations, is the modern money power.

    That there is a gigantic combination of the money dealers, a powerful international trust of usurers, asserting a superiority above all jurisdictions, and having for its servants the so-called statesmen and potentates of various nations, who willingly register the decrees of this money power upon the statute-books of the respective states, is a fact that can be sustained by irrefutable evidence.

    This great international monetary trust now menaces the very life of this nation, and the people must dethrone it and subordinate it to their will, or American liberty will vanish.

    The Declaration of Independence, which announced the true principles of government, was a memorable protest against the rapacious money power composed of the landed aristocracy, the trading, commercial, and manufacturing interests of England, which, by a long series of vicious and unconstitutional acts of Parliament, sought to eat out the substance of the colonists.

    The war of the Revolution, which followed, set its seal of approval upon the patriotic efforts of the colonists against oppression, and freedom was achieved.

    Upon the conclusion of that most righteous conflict, a more perfect union was formed to establish justice, insure domestic tranquility, provide for the common defense, promote the general welfare, and secure the blessings of liberty for themselves and posterity by the adoption of the Federal constitution.

    General Washington was chosen the first President by a unanimous vote.

    For his constitutional advisers he appointed Thomas Jefferson for Secretary of State; Alexander Hamilton for Secretary of the Treasury; James Knox for Secretary of War; and Edmund Randolph for Attorney General.

    Jefferson, who was the most accomplished scholar in America, the profoundest thinker upon the principles of Government of any age, the friend of humanity and a staunch believer in the capacity of the common people for self-government, was a representative of that industrial element which sustains society by its labors.

    Hamilton, who was an aristocrat by birth and breeding, and who was connected by marriage with the wealthiest family of the landed aristocracy of New York, was a strong representative of the trading, banking and commercial element of New York City and New England, which constituted the Tory clement of the Revolution.

    The presence of two statesmen of such wholly antagonistic views and temperaments in the cabinet of Washington, naturally originated divisions of political sentiment, from which sprang two great political parties.

    One of the first measures which received the aid and sanction of Hamilton was the act of Congress adopted February 25, 1791, chartering the Bank of the United States.

    Jefferson, whose penetrating mind perceived the vast power for mischief lodged in an Institution of that nature, in a powerful communication to the President, advised him to veto the bill. Washington, however, accepted the views of Hamilton, his Secretary of the Treasury, and signed the bill, and it became a law.

    By the terms of the act incorporating the bank, its capital was fixed at ten millions of dollars. The power to issue its circulating notes as money having full legal tender quality for the payment of taxes and demands due the Government was conferred upon it. It was made the depositary of the revenues of the Government, and therefore it became the fiscal agent of the Treasury department. It was chartered for the period of twenty years. For the extensive powers and exclusive privileges bestowed upon it by Congress, the bank paid the United States a small bonus.

    This bank, therefore, was a monopoly sustained by the credit and the revenues of the United States. It had the solo power of issuing legal tender paper money, and its actual capital was trebled in its earning capacity by loaning its circulating notes at interest, and by having the control of the government revenues.

    This was the first appearance of an ORGANIZED MONEY POWER in the United States.

    Thomas Jefferson, by voice and pen, in language of rare power and felicity, pointed out the dangerous possibilities of the bank to influence the politics and business of the nation.

    In a letter to Madison in 1793, Jefferson stated that the bank party consisted of the fashionable circles of Philadelphia, New York, Boston and Charleston (natural aristocrats). 2. Merchants trading in British capital. 3. Paper men. Against the bank were 1. Merchants trading on their own capital. 2. Irish merchants. 3. Tradesmen, mechanics, farmers and every other possible description of our citizens.

    In 1811, Congress refused to re-charter the bank, and as it had during its brief career obtained the mastery over the entire business of the country by its loans of circulating notes and the public revenues, and had built up a system of credit in the commercial centers, to intimidate Congress and the people, it made a concerted contraction of the currency and brought on the great panic of 18ll.

    United States Senator Benton, in a speech in the senate during the administration of Jackson, thus graphically states the manner in which the bank con-trivet to manufacture public sentiment in its favor He says: –

    “All the machinery of alarm and distress was in as full activity at that time as at present, and with the same identical effects- town meetings, memorials, resolutions, deputations to congress, alarming speeches in congress. The price of all property was shown to be depressed. Hemp sunk in Philadelphia from $350 to $250 per ton; flour sunk from $ll.00 per barrel to $7.75; all real estate fell thirty per cent.; five hundred houses were suspended in their erection; the rent of money rose to one and a half per month on the best paper; confidence destroyed; manufacturing stopped; workmen dismissed and the ruin of the country confidently predicted.”

    The Senator goes on to show that great public meetings were held, inflammatory speeches made, cannon fired, great feasts given – all engineered by the bank. That those members of Congress who favored the bank, traveled with public honors like conquering generals returning from victorious battlefields, saluted with acclamations by the masses, escorted by processions, and that those members favoring the bank were exhibited throughout the United States as though they were some superior beings from the celestial regions.

    In 1812 occurred the second war with England, and the bank threw its whole influence against the United States during that great struggle.

    Evidence is not wanting to sustain the charges made that the bank element of New England planned the separation of that section from the Union.

    During the continuance of this war, the United States issued its treasury notes with full legal tender power, and they were gladly received by the people.

    Albert Gallatin, for twelve years Secretary of the Treasury, and one of the ablest statesmen of the day, thus bears valuable testimony to the efficiency of government paper money in carrying the United States through that war. He says: –

    “The paper money carried the United States through the most arduous and perilous stages of the war, and though operating as a most unequal tax, it cannot be denied that it saved the country.”

    In a letter to John Tyler, May 28, 1816, Jefferson says:-

    “The system of banking we have both equally and ever re probated. I contemplate it as a blot left in all our constitutions which, if not covered, will end in their destruction, which is already hit by the gamblers in corruption, and is sweeping away in its progress the fortunes and morals of our citizens. Funding I consider as limited rightfully to a redemption of the debt within the lives of a majority of the generation contracting it; every generation coming equally by the laws of the Creator of the world to the free possession of the earth He made for their subsistence unencumbered by their predecessors. And I sincerely believe with you that banking institutions are more dangerous than standing armies, and that the principle of spending money to be paid by posterity under the name of funding is but swindling futurity on a large scale.”

    In a letter of March 2, 1815, written by Jefferson to the celebrated French author, Say, he said: –

    “The government is now issuing treasury notes for circulation, bottomed on solid funds and bearing interest. The banking confederacy and the merchants bound to them by their debts will endeavor to crush the credit of these notes; but the country is eager for them as something they can trust to, and so soon as n convenient quantity of them can get into circulation the bank notes die.”

    It has been stated that the bank, during the war of 1812, exerted its whole influence against the United States. It was a matter of little concern to it that Great Britain had impressed into her service thousands of native born citizens of this country, and compelled them, against their will, to man British guns. What cared the bank that hundreds of American merchant vessels were confiscated, in a time of profound peace, by orders of the English government, and that repeated insults had been heaped on this republic by the insolence of British statesmen?

    Although the bank was a creature of the legislative powers of congress, and had received vast financial benefits from the country, it sought to embarrass the government in its struggle against Great Britain by arraying the moneyed class against the struggling republic.

    Money could not be obtained by means of loans to organize, arm, and equip the American armies and to construct vessels of war to protect American commerce. In this emergency the counsel of Jefferson was requested, and he advised the issue of treasury notes by the government in lieu of borrowing.

    In a letter dated September ll, 1813, he thus stated his position: “The question will be asked, and ought to be looked at, What is to be the course if loans cannot be obtained?” There is but one – “Carthago delenda est.” Bank paper must be suppressed, and the circulating medium must be restored to the nation to whom it belongs. It is the only fund on which they can rely for loans; it is the only resource which can never fail them, and it is an abundant one for every necessary purpose. Treasury bills, bottomed on taxes, bearing or not bearing interest, as may be found necessary, thrown into circulation will take the place of so much gold and silver, which last, when crowded, will find an influx into other countries and thus keep the quantum of medium at its salutary level. Let the banks continue, if they please, but let them discount for cash alone or for treasury notes.”

    The sound advice couched in this letter was heeded by the government, and the country was carried safely through the second war for independence.

    Immediately after the close of the war, the bank put forth renewed efforts to secure a new charter.

    At this juncture, William Cobbett, the celebrated English writer and economist, transmitted a letter to

    Mr. Dallas, Secretary of the Treasury under President Madison, in which he strenuously urged him to oppose the project.

    As a warning against chartering a bank of issue, Cobbett pointed out the immense power of the Bank of England to ruin the tradesmen of that country, and to dictate the political sentiments of that people. He said: –

    London, January 13, 1816.
    “To Mr. Secretary Dallas:
    “Sir: I have read with great care and uncommon interest your proposition to congress, under date of 6th December, 1815, for the establishment of a national bank; and as a part of the reasons which you urge in support of that proposition appear to be founded on the experience of a similar institution in England, I cannot refrain from endeavoring to show you what some of these effects really have been, and what is at present the situation of this country, owing, in a great measure, to the existence of a great banking establishment closely connected with the government.

    “It is the evil of a national bank, as experienced by us, to which I particularly wish to draw your attention. You profess, and I dare say very sincerely, so to frame this establishment in America that it shall be independent of the Government. It is next to impossible, indeed, that you, or any of the persons in whose hands the Government is, should have a desire to make a bank what our bank has long been; but while there is a possibility of its becoming, in any hands or at any time, anything resembling this bank, it must be a matter of serious dread to every friend of America that such an establishment is likely to take place. Sir, it is as a bank of discount that this establishment exercises the most pernicious influence. The directors, who are a chosen divan, regulate these discounts, and in so doing decide in some sort upon the rise or fall, the making or the ruin, of all men in trade, and indeed 17 of most other men, except such as have no capital at all.

    “The amount of these discounts at any given time is supposed to be about L6,000,000, as they are never for more than two months. Here is a sum of thirty-six millions lent every year to individuals. The bills for discounts are sent in; the directors consent or not, without any reasons assigned. Now, sir, consider the magnitude of the sum discounted. It is little short of half a million dollars a day, Sundays excepted. It is perfectly well known to you that in state of such things almost every man in trade is under the necessity of having a regular supply from discounting. If he be excluded from his fair share here, he cannot trade with the same advantage as other men trade. If he be in the practice of discounting, and if his discounts be cut off, he cannot go on; he stops payment and is frequently ruined forever, even while he possesses property which, with the fair chances of time, would not only enable him to pay his debts but to proceed in prosperity.

    “I beseech you, then, sir, to look seriously at the extent of the dangerous power of these bank directors. You must see that they hold in their hands the pecuniary fate of a very large part of the community, and that they have it in their power, every day of their lives, to destroy the credit of many men, and to plunge their families into shame and misery. If I am asked for their motives to act like these, to pursue such partiality, to make themselves the instruments in committing such detestable injustice and cruelty, need I point out to you that they have been and must be constantly actuated by the strongest political prejudices? The fact is, however, that the Bank of England, by means of its power of granting or withholding discounts, has been, and is one of the most potent instruments of political corruption, on the one hand, and of political vengeance on the other hand.”

    In speaking of the great profits reaped by that bank, this writer said: –

    “I have given this rough statement that you may be struck with the magnitude of the object I present to you. Diminish the amount as much as you fairly can and even then you will dwell upon the subject with a deliberation you cannot prevent. One fact will at least corroborate what I have suggested; viz., that the Bank of England had L20,000,000, or nearly $100,-000,000, surplus in nineteen years, after paying bonuses and dividing 7 per cent, per annum, which was two fifths more than legal interest. I will not here allude to the United States Bank, to which I may hereafter devote an essay. ”

    The array of facts set out by this writer, in which he exhibited the appalling power of this bank, did not deter the American statesmen of that day from their attempt to fasten a like institution on this country.

    In 1816, congress chartered the United States Bank with a capital stock of thirty-five million dollars; to it was delegated the sole power of issuing notes receivable by the United States for taxes and demands due it; and designed to serve as the Treasury Department of the government by receiving and disbursing the public revenues of the nation.

    Section 21 of the Bank Act was as follows: –

    “That no other bank shall be established by any future law of the United States, during the continuance of the corporation hereby created, for which the faith of the United States is hereby pledged. Provided, Congress may renew existing charters for banks within the District of Columbia, not increasing the capital thereof, and may also establish any other bank or banks in said District, with capitals not exceeding, in the whole, six millions of dollars, if they shall deem it expedient.”

    By this section Congress surrendered its constitutional powers to legislate upon a subject within its exclusive jurisdiction for the period of twenty years, Not satisfied with a monopoly of the currency and banking of the country, the unlimited greed of the wealthy stockholders of this bank demanded and secured frown Congress, a pledge of the public faith that the essential powers of the Government should lie dormant for twenty years!

    In the early days of the republic, the accursed spirit of special privileges had shorn the nation of its means of self-preservation.

    For the exclusive powers conferred upon it, the government received in return for this valuable franchise a small annual bonus.

    It will be ascertained from the enormous powers enjoyed by the bank, that it obtained a monopoly of the circulating medium of the country; that, in addition to its capital stock of thirty-five million dollars which constituted its primary loanable fund, it would earn interest upon the circulating notes issued by it, as well as usury upon the government revenues when used in discounts.

    Therefore, by force of law, the interest earning capacity of its capital was more than doubled.

    It was a colossal moneyed monopoly.

    The bank rapidly obtained a practical control over the business of the nation, and it would tolerate no opposition. By its methods of conferring substantial favors upon the influential journals of the leading commercial cities, and by its loans to powerful members of both branches of Congress, it was enabled to rally to its support a coerced and manufactured public sentiment – far-reaching and wide-spread as the limits of the Union.

    The financial power of the bank, under its able and unscrupulous management, had become so dominant in its influence that it deemed itself master of the government and the people.

    This monopoly believed in the Hamiltonian maxim that a “Public debt is a public blessing,” and, during its career as the fiscal agent of the Government, threw every obstacle in the way of the payment of the national debt.

    It may be inquired by some why the bank should oppose the payment of the debt? The reason is obvious. The larger the debt, the more revenues necessary to pay the interest charge thereon, and, therefore, the more profit to the bank from the use of the increased revenues in making loans and discounts.

    From 1816 to 1828, it was the sole arbiter of the financial affairs of the nation, both public and private. Its power in politics was immense, and it swayed elections at will.

    The most eloquent Senators and Representatives were continually sounding its praises in the halls of Congress as the most perfect financial institution ever devised by the wit of man. Deluded with the idea that it was invincible in its influence, and that it was a necessary part of the machinery of Government, it was confident that its charter would be renewed before its expiration by limitation of law.

    The audacity of the bank was destined to receive a check in its career of uninterrupted power and success, and its astonishing abuses of its franchise where to be mercilessly exposed, and it was doomed to fall never to rise again.

    In the presidential election of 1828, Andrew Jackson, the hero of New Orleans, was elected chief magistrate by a great majority, and the bank, its defenders, and retainers, were fated to run counter to a patriot and statesman of invincible will and unflinching integrity.

    At the time of this election, and prior thereto, the public debt was being reduced rapidly, and it would not be long before the United States would not owe a single dollar.

    As has been stated, the United States bank strongly opposed the payment of the debt for the aggrandizement of its own selfish purpose.

    On the 8th day of December, 1829, President Jackson, in his first annual message to Congress, announced to that body that he was opposed to the bank, and that he would not favor a renewal of its charter. In the year 1830, a large surplus of public revenues accrued to the United States, and according to law, the money was deposited in the bank. This accumulation of revenues served to augment the power of the bank as it increased its resources, and, therefore, its facility to make additional loans and discounts in the various commercial centers of the country.

    President Jackson discerned the policy of the bank, and in 1830 he advocated the passage of a law distributing these surplus revenues among the states. He again opposed the renewal of its charter.

    United States Senator Benton, of Missouri, a man of great energy, extensive learning, and commanding ability, thoroughly understood the means by which the bank had obtained its mastery over the commerce and industry of the nation, and, therefore, at that session of congress, he presented a resolution in the United States senate to the effect, that the charter of the bank ought not to be renewed. The resolution was lost by a vote of twenty-three to twenty. The introduction of that resolution and the narrow majority by which it failed of passage, sounded a note of warning to the bank, and it gathered all its energies for the struggle that sooner or later was bound to come.

    To arouse public sentiment in its behalf, it initiated a policy of expanding its loans until they reached the vast total of seventy-one million dollars, which were so judiciously placed among leading merchants and manufacturers, that, in the event of their being called in by the bank, a powerful pressure would be exerted upon the President and Congress by those who were borrowers of the bank.

    On the 4th of July, 1832, a bill to re-charter the bank, after its passage by Congress, was sent to President Jackson for approval.

    Many of the influential political friends of the President, aware of his intense hostility toward the bank and its methods, importuned him to sign the bill; large delegations of leading citizens from every trade center in the country implored him to allow the measure to become a law. Merchants and importers, who were heavy borrowers from the bank, trooped to Washington to add their appeals to the petitions already presented.

    Its paid hirelings, in the halls of congress and elsewhere, predicted dreadful results to business interests, should the President not recede from his opposition to the bill continuing the existence of the bank for the period of twenty years longer.

    To add to the general clamor, the bank, through its officials, avowed its purpose to precipitate a panic, and to pull down in ruins the business of the country, should its demands not be concealed. It compelled its thousands of borrowers to sign distress petitions, which it caused to be sent to the President as the apparently free expression of public sentiment.

    The magazine had long been prepared by the bank, the train was laid, and Nicholas Biddle, the president of this great financial institution, sat in his luxurious office, and declared himself ready and willing to apply the match that would start the most ruinous financial explosion that had yet shook the foundations of the republic. Mr. Biddle had most able lieutenants in both branches of congress devoted to his interest.

    Daniel Webster, the eloquent orator and great lawyer; Henry Clay, whose persuasive powers were unrivaled; and Calhoun, the great leader of the South, led the banking interest in congress.

    In a work entitled, “Andrew Jackson and the Bank of the United States,” William L. Royall thus speaks of the conduct of these three leaders: –

    “In addition to all its other sources of power the cause of the bank received invaluable assistance from the coalition of these great men (Webster, Clay, and Calhoun). Each was an aspirant for the presidency, and upon the bank’s cause and paper money, each found a common ground upon which all three could meet and oppose Jack on, the great enemy of both these things. All the movements of the bank were but a repetition, with a change of names and dates, of what had taken place on 18ll.”

    On the other hand, the stalwart Benton was a stern opponent of the bank, and he was supported by an able array of statesmen of the first rank.

    Webster, and Clay advocated a liberal construction of the Constitution, and were eternally sounding the praises of that instrument as the noblest work of statesmanship, yet, while ascribing to it the most ample powers and authority, they strangely supported the theory that the United States Bank was absolutely necessary to the financial administration of the Federal Government.

    Benton was a strict constructionist, and asserted that the general Government was inherently qualified to transact its financial operations without the aid or assistance of any bank or system of banks. He ably maintained the Jeffersonian principles of Government that bank paper should be suppressed.

    In a speech delivered in the United States Senate, Benton thus truly describes the immense power of the bank over the Government and the people: –

    “The Government itself ceases to be independent, it ceases to be safe when the national currency is at the will of a company. The Government can undertake no great enterprise, neither war nor pence, without the consent and co-operation of that company; it cannot count its revenues six months ahead without referring to the action of that company – its friendship or its enmity, its concurrence or opposition – to sec how far that company will permit money to be scarce or to be plentiful; how .far it will let the money system go on regularly or throw it into disorder; how far it will suit the interest or policy of that company to create a tempest or suffer a calm in the money ocean. The people are not safe when such a company has such a power. The temptation is too great, the opportunity too easy, to put up and put down prices, to make and break fortunes; to bring the whole community upon its knees to the Neptunes who preside over the flux and reflux of paper. All property is at their mercy, the price of real estate, of every growing crop, of every staple article in the market, is at their command. Stocks are their playthings – their gambling theater, on which they gamble daily with as little secrecy and as little morality and far more mischief to fortunes than common gamblers carry on their operations.”

    This unanswerable argument, built on impregnable facts, could not be met by all the eloquence and logic that could be mustered against it by the great Triumvirate – Clay, Webster and Calhoun.

    In a message to Congress, President Jackson, in speaking of the banking power, said: –

    “In this point of the case the question is distinctly presented, whether the people of the United States are to govern through representatives chosen by their unbiased suffrages, or whether the power and money of a great corporation are to be secretly exerted to influence their judgment and control their decisions.”

    These pointed shafts from the executive struck home, and rankled in the breasts of those Senators and Representatives who supported the bank and its policy.

    When the bank ascertained beyond any doubt that President Jackson was firmly opposed to its further continuance, it began calling in its loans rapidly, the volume of currency was contracted greatly by the bank and its branches, merchants were mercilessly driven to the wall, mills and factories closed down everywhere, and tens of thousands of skilled workmen were thrown out of employment, and their families felt the pangs of hunger, notwithstanding there was abundance in the country.

    Every day it tightened its coils around its helpless victims, while President Biddle sat in his office at the bank, and laughed at the needless ruin he wrought among his fellowmen. His course is only paralleled by that of Nero, who is said to have fiddled while Rome was burning.

    The great journals of the leading cities, subsidized by loans – presumably – teemed with editorials denouncing President Jackson anti defending the course of the bank.

    Distress meetings at the same time and at the same points were held, fiery speeches were made, and strongly worried resolutions were adopted, requesting the President to append his signature to the bill renewing the charter of the bank.

    There was a singular identity in the editorials written, in the speeches delivered, and in the resolutions adopted, that gave evidence of a concerted action. This similarity of sentiments and language in the journals, speeches, and resolutions, evinced a most remarkable talent, for combining the various means of influencing President Jackson.

    But the hero of New Orleans was as immovable as the Rock of Gibraltar.

    Andrew Jackson was in many respects the most remarkable man in American history. A sincere patriot of the purest integrity, with a clearness of mental vision that was unsurpassed, with a profound insight into the principles upon which our Government rested, he plainly saw that the interests of the bank were wholly at variance with that of American liberty.

    He well knew that to transfer to a private corporation for its gain, the issuance and control of the currency of the country, and to accumulate in its vaults the national revenues, would eventuate in building up a moneyed monopoly, ultimately controlling the press, the business interests, and the legislation of the nation.

    That point was now reached.

    He was utterly opposed to the Government abdicating its highest sovereign function,- the issuance and control of the currency,- and delegating it to individuals or to corporations for their gain.

    He was conversant with the traitorous conduct of the bank during the war of 1812, and he concurred in the declaration of Jefferson that, “Banks of issue were more dangerous to the liberties of the people than standing armies. ”

    In speaking of the firmness displayed by President Jackson against the arrogance of the bank, the distinguished historian Bancroft says: –

    “When the period for addressing Congress drew near, it was still urged that to attack the bank would forfeit his popularity and secure his future defeat. The President replied, ‘It is not for myself that I care.’ It was urged that haste was unnecessary, as the bank had still six unexpired years of chartered existence. ‘I may die,’ he replied, ‘before another Congress comes together, and I could not rest quietly in my grave, if I failed to do what I hold so essential to the liberty of my country.’ ”

    Bancroft further says, that, upon one occasion when the bank conflict had reached its greatest height, the President and some of his friends were standing over the rocks of the Rip Raps, looking out upon the ocean, when the subject of chartering the bank was brought forward, whereupon the President remarked, “Providence may change my determination; but man no more can do it than he can remove these Rip Raps, which have resisted the rolling ocean from the beginning of time.”

    History fails to record a nobler sublimity of purpose than that displayed by President Jackson during the war of the bank upon the people.

    Notwithstanding the immense pressure brought to bear upon him, President Jackson, on the 10th day of July, 1832, returned the bill to the Senate, whence it originated, accompanied with his veto message, which was a masterly exposition of his views upon the true principles of free Government, and it ranks in importance with the Declaration of Independence.

    The first reason assigned by the President in his objections against the ‘renewal of the charter of the bank was, that it created a monopoly under the authority of the general Government, and, therefore, it increased the value of its stock far above its par value, which operated as a gift of many millions to its stock holders.

    The President laid down the fundamental principle, that a monopoly should only be granted when it returned a fair equivalent to the people.

    He showed that while its capital stock was fixed at $28,000,000, to confer this privilege upon the bank would add the enormous sum of $17,000,000 to the value of the stock, and for this immensely valuable franchise the Government would receive the pitiful sum of $200,000 per annum.

    The President advocated the sale of the stock to the highest bidder, and that the premium received there from by the Government be paid into the national Treasury to lighten the burdens of taxation in lieu of its bestowal upon a few wealthy citizens.

    He stated that $8,000,000 of the stock of the present bank was held by foreigners, chiefly in England; that this was the most dangerous feature of the plan; that a majority of the shares of its stock might fall into those alien hands, and that in the event the United 29

    States would be involved in war with that nation, thus holding a large amount of the stock of this great bank monopoly, its influence would be thrown against the United States.

    The President says: –

    “All its operations within would be in aid of the hostile fleets and armies without. Controlling our currency, receiving our public moneys, and holding thousands of our citizens in dependence, it would be more formidable and dangerous than the naval and military power of the enemy.”

    He produced figures demonstrating the sectional character of the bank, that out of $35,000,000 of stock, $8,405,500 were held chiefly by Great Britain; only $140,200 were held by the nine great western states; $3,455,598 in the four southern states, and $13,522,000 in the eastern and middle states.

    That in 1831, the profits of the bank were $3,455,598 of this amount the western states contributed $1,640,048; the four southern states $352,507, and the middle and eastern states $1,463,041.

    It will be ascertained that under the operations of this banking monopoly, the agricultural states of the West were paying heavy tribute to the East.

    It was further pointed out by the President, that the principle of taxation involved in the bill was radically Wrong in this: that only the stock could be taxed where held, Therefore, while the nine western states paid $1,640,048 in profits to the bank, only $140,200 of its stock was held there subject to taxation; that, in the year 1831, the branch bank at Mobile earned dividends of $95,140, yet the state of Alabama could not tax the property of the bank, because net a single share of its stock was owned in its jurisdiction.

    The foreign stock holders could not be taxed a single penny on their holdings, as they were beyond the taxing power of the United States. The foreign stock holder would be drawing large dividends from the America people without bearing any of the burdens of government. This would tend to alien ownership of this bank, non-contribution to the- burdens of Government creating this valuable privilege, and a continued drainage of specie to foreign nations.

    The fourth section of the proposed law provided: –

    “That the bills and notes of said corporation, although the same be, on the faces thereof, made payable at one place only, shall, nevertheless, be received by the said corporation at the bank or at any of the offices thereof, if tendered in liquidation or payment of any balance or balances due to said corporation, or to such office of discount and profit from any other incorporated bank.”

    The right thus conferred upon state banks to pay their debts to the United States Bank, with the notes and bills of any branch bank thereof, would tend to unify the whole banking interest of the nation into a powerful combination, while at -the same time, any individual who held currency issued by a branch of the United States Bank, situated at any other place than his residence, was deprived of that right, therefore, be would be compelled to discount the bills of the branch bank, or transmit them to Philadelphia to obtain the cash for them.

    These were a few of the reasons assigned by the President in his famous veto message.

    It is now conceded by the most eminent historians of America, that General Jackson, in throttling the corrupt and unscrupulous money power of that day, saved the nation.

    On the 8th of January, 1815, General Jackson had met the veterans of Wellington at New Orleans, and inflicted upon them the most disastrous defeat ever suffered by England, and shed undying renown upon American arms. He saved America then, and he preserved its independence in 1832.

    By act of Congress, June 28, 1834, a change was made in the coinage laws of April 2, 1834 atter act, the legal ratio of silver to gold was fixed at fifteen to one, that is, fifteen pounds of pure silver were the legal equivalent of one pound of pure gold, and this ratio was maintained until the passage of the act of June 28, 1834.

    France and the other Latin States maintained a legal ratio of fifteen and one half to one. Consequently the United States over-valued silver when compared with gold. The bullion dealers, over on the alert for a profit, sent the gold abroad and sold it at a premium. To remedy this, the act of June 28, 1834, reduced the quantity of gold in the gold eagle from 2471/2 grains of pure gold to 232 grains, or a reduction in the ten dollar gold piece from 270 grains of standard gold to 258 grains. A corresponding reduction was made in the half-eagle and quarter-eagle. A fraction over six per cent of gold bullion was therefore deducted from the gold coins. This made the legal ratio of silver to gold stand at sixteen to one. By this act, silver was undervalued and gold made its appearance in circulation, and silver disappeared from the channels of trade.

    The object of the passage of this law was to supersede the United States Bank bills by the substitution of gold coin as a circulating medium. The people remembered the great efforts of the bank to monopolize the entire volume of money in the country, and gladly received the two and one half, five and ten dollar gold pieces in preference to bank notes.
    This substitution of gold coin for bank notes greatly diminished the profits of the bank, and it immediately declared war upon that coin. Its subsidized press, its minions and dependents denounced this species of money in terms of ridicule. The subservient tools of the bank, when offered gold coin in the ordinary transactions of business, would shudder and recoil at its appearance, and demand United States bank notes as the superior money.

    In the meantime, however, in 1832, a presidential election was held. Henry Clay was put forward as the candidate of the Whigs and of the bank power. Andrew Jackson was the candidate of the Democratic party, and represented the principles of Jefferson. Jackson received two hundred nineteen electoral votes to forty-nine for Clay. The prophecies of those Democrats that Jackson had ruined the party by his contest with the bank were refuted by a decisive vote of the people.


    The next step taken by the President to curtail the power of the bank for mischief, was the removal of the government deposits amounting to many millions of dollars.

    After the bank so signally failed to obtain a renewal of its exclusive banking privileges, it did not alleviate from its policy of inflicting distress and ruin upon the people. From the 1st day of August, 1833, to the 30th of June, 1834, it continued its contraction of the currency by calling in its loans, giving as its reasons therefor, that the Government was harassing it on every hand. It had ample time in which to arrange its affairs without seriously crippling the business of the country and its excuse was not valid.

    Although many millions of public revenues were under its sole charge, constituting a loanable fund for the benefit of the bank, its hireling press teemed with abuse against the administration of President Jackson.

    The President, in view of all the facts within his knowledge, entertained the opinion that the bank was insolvent, and an unsafe depository for the public moneys. He had previously communicated his belief to Congress as to the unsafe condition of the bank, but such was its influence in that body, that the House of Representatives, by a practically unanimous vote, declared its confidence in the institution.

    In the lawful exercise of his powers, the President ordered the Secretary of the Treasury, through the five government directors, to investigate its financial condition. The directors made a demand upon the bank for an inspection of its books, but they were denied access to them, In the face of the obstacles thrown in their way to ascertain its true condition, the directors made an investigation with astonishing results. To obtain a full, true, and complete statement of the expenditures of the bank for political purposes, the official directors submitted a resolution to the full board of the bank, requesting the cashier to furnish a statement to the board, as early as possible, showing what amount was paid out for certain purposes, the sums of money paid to each person, the quantity and names of documents furnished by him, and his charges for the distribution of them. Similar statements were requested from the various branch offices of the bank. The resolution was voted down by the board of directors, and a substitute was adopted expressing inexplicit confidence in the course of its president – Nicolas Bible.

    Subsequent events gave satisfactory explanation why the officials of the bank pursued That course in refusing an inspection of the books. Upon a report of the government directors setting forth these facts, the President assumed the responsibility of removing the public moneys from the bank, and distributed them among the various state banks.

    In this course he met decided opposition to this order in his cabinet. The Secretary of the Treasury, William J. Duane, peremptorily refused to obey the command of his chief, and for this act of insubordination he was summarily removed from his office.

    Attorney General Taney was appointed to fill the vacancy occasioned by Duane’s removal, and the order was executed to the letter.

    The bold stand taken by the President in the removal of the deposits, stirred up the wrath of the bank party in Congress, and Henry Clay offered a resolution in the United States Senate as follows: –

    “Resolved, That the President in the late executive proceeding in relation to the public revenue, has assumed upon himself authority and power not conferred by the constitution and laws, but in derogation of both.”

    This resolution censuring President Jackson was adopted by the Senate on the 28th of March, 1834. The bank pointed to this action of the senate as proof of its great power.

    On the 15th day of April, 1834, President Jackson transmitted a message to the Senate, respectfully protesting against this implied impeachment of his official acts. His communication to that body was a magnificent exposition of constitutional law, and he severely arraigned the senate for passing judgment upon him without granting him an opportunity to be heard in his defense.

    Three years afterward the resolution of Clay was expunged from the journals of the senate.

    The President was fated to emerge triumphant from every contest with the banking power.

    The bank still continued its warfare upon the people. It avowed its purpose to precipitate a wide spread panic. It announced its intention to crush the business of the nation, unless the order of removal was recalled, and the deposits restored. The pressure brought to bear by the bank was directed at the chief commercial and industrial centers. The havoc wrought by-it was as broad, as the range of its operations, and its course was sustained by politicians as one of self defense.

    Public men who were deeply indebted to it openly upheld its conduct. One of these purchasable demagogues owed the bank the great sum of $100,000, and his defense of his owner was in direct proportion to his obligation to his master – the bank. One loan of $1,100,000 was made by it to a broker in New York City, at which time it was steadily contracting the currency at every point where it was represented by an office. The broker to whom this immense loan was made, accumulated a fortune by speculating with this money upon the misfortunes of others. Distress meetings were held everywhere under the auspices of the bank, resolutions were adopted, and memorials were presented to the President, requesting him to rescind his order of removal, but without avail.

    The presidents, vice-presidents, and various other officers of the so-called distress meetings were selected from those who had supported Jackson for the presidency, which fact was always announced to the people. The petitions, memorials, and remonstrances presented to the President but served to strengthen his determination to crush the bank, and the last fangs of the oppressors were pulled by the removal of these deposits amounting to $40,000,000.

    It must be borne in mind, that during the administration of Jackson, a controversy arose between the United States and France with reference to the depredations committed upon our merchant marine by the latter nation during the Directory. A treaty had been concluded by the administration with the kingdom of France on the 4th of July, 1831, by the provisions of which, the latter power agreed to pay the United States the sum of $5,000,000, as indemnity for such depredations.

    The French authorities failed to pay the first installment thereof, and the Secretary of the Treasury, under the direction of the President, drew a bill of exchange upon France for the amount. The bill was transmitted to Paris through the United States Bank as the fiscal agent of the Government. The authorities of France refused to honor the bill, and it was protested, whereupon the bank seized upon the Government funds in its possession to the amount of $170,040 which it claimed as damages for the protestation of the bill. This high handed procedure was clearly illegal on the part of the bank, and violative of the Constitution which provides that no money shall be drawn from the treasury, except through appropriations made by Congress.

    To force a suspension of specie payments by state banks of issue, it drew immense bills of exchange on Paris, where it had no money, for the payment of them, then drew vast sums of specie out of the banks of New York City, and transmitted it to Paris to meet the bills so drawn by it.

    In speaking of the course of the bank, in attempting to force a suspension of specie payments by the state banks of issue, Mr. Royall says: –

    “It was certainly not too good to do so, and in the year 1841, just before it finally expired, it is proved to have attempted to create a general suspension, by forcing the banks of the city of New York to suspend. The manner of this attempt was afterward related by its cashier. It consisted in selling bills in unlimited quantities on Paris – at this time in great demand – where it had not a cent to meet them, and drawing the coin with the proceeds of these sales out of the New York banks and shipping it abroad to meet these bills as they made their appearance there. The bills, however, got to Paris before the coin, came back protested, and the great bubble was finally pricked.”

    This act was committed by the bank to embarrass the government, to emphasize the panic than beginning to rage, and to bankrupt the business interests of the nation.

    In short, no trick, device, or artifice was too villainous or traitorous for the bank to injure the credit of the Government and the happiness of the people. The bank again failed to obtain a charter in 1841.

    The rottenness of the bank then became known, and a complete investigation into its management from 1830 to 1836, instituted by the stockholders, developed an astonishing degree of villainy, corruption, and rascality that was appalling, and the results of which more than sustained the charges brought against it by President Jackson and his supporters.

    It was discovered that hundreds of thousands of dollars were expended by President Biddle in influencing elections, subsidizing the press, and bribing members of Congress.

    The stockholders, on the completion of this investigation, instituted a suit against President Biddle in the United States circuit court at Philadelphia, for the sum of $1,018,000 expended by him for which no vouchers could be found.

    It was further demonstrated that, from 1830 to 1836, during the struggle of the bank for a new lease of corporate life, loans, aggregating more than $30,000,000, were made by its president to members of Congress, editors of newspapers, politicians of all grades, jobbers and brokers, mostly without security.

    Perhaps all the facts connected with its management were never made known, on the ground of public policy, as the reputations of many eminent men, not excepting presidential candidates, would have been utterly ruined.

    In speaking of the contest between the bank and President Jackson, Parton, the biographer, says: –

    “In these Jacksonian contests, therefore, we find nearly all the talent, nearly all the learning, nearly all the ancient wealth, nearly all the business activity, nearly all the book-nourished intelligence, nearly all the silver-forked civilization of the country, united in opposition to General Jackson, who represented the country’s untutored instincts.”

    Parton further says that Jackson was called a murderer, a traitor, an ignoramus, a fool, a crook-back, a pretender, and various other vile names.

    Nicolas Biddle, who, to a very large extent, was responsible for the gigantic conspiracies, bank-panic with their resultant ruin and misery, was driven in disgrace from his exalted position, and he died a shameful death almost unknown, unhonored, and unsung.

    The man before whom bowed in fawning adulation great and wise statesmen, merchant princes, editors of powerful journals, and leaders of public opinion; he, who, in the magnitude of his financial plans and undertakings, rivaled the money kings of Europe; he, who arrayed dollars against the immutable principles of justice and the rights of man, lived to see his name become a by-word, a hissing, and a reproach.

    The career of the United States Rank and its president is an awful monument of warning on the highway of time to come, an object lesson to that colossal greed of power, which, to tighten its grip upon the people, scatters distress and ruin in its train, and which, from its ramparts of ill-gotten wealth obtained by monopoly and special privileges, defies the laws of man and the laws of God.

    On the other hand, the fame of Jackson shines more and more with the lapse of time.

    Thomas Jefferson, the founder of American Democracy, and the friend of the human race, is honored as the great constructive statesman of America; Andrew Jackson is revered as that great leader who regenerated the politics of his country, and rescued a people from financial slavery. During his administration, the public debt was wholly paid, a large surplus of public revenues accumulated to the credit of the United States, the money power was dethroned, the American nation was honored everywhere, ‘and he retired from the presidency amid the plaudits of his countrymen.

    In his farewell address to the people, March 3, 1837, he solemnly warned them against the money power, that special privileges must not be granted to any class of citizens, and that justice must be the basis of public and private conduct.

    In this noble document, the President admonishes the people to be on their guard against the money power. He says: –

    “But when the charter for the bank of the United States was obtained from Congress, it perfected the paper system, and gave to its advocates the position they have struggled to obtain from the commencement of the Federal Government down to the present hour. The immense capital and peculiar privileges bestowed upon it, enabled it to exercise despotic sway over the other banks in every part of the country. From its superior strength it could seriously injure, if not destroy, the business of any one of them that would incur its resentment; and it openly claimed for itself the power of regulating the currency throughout the United States. In other words, it asserted (and undoubtedly possessed) the power to make money plenty or scarce, at its pleasure, at any time, and in any quarter of the Union, by controlling the issues of other banks, and in permitting an expansion, or compelling a general contraction of the circulating medium according to its own will.

    “The other banking institutions were sensible of its strength, and they soon became generally its obedient instruments, ready at all times to execute its man-dates; and with the other banks necessarily went also that numerous class of persons in our commercial cities who depend altogether on bank credits for their solvency and means of business, and who are therefore ‘ obliged, for their safety, to propitiate the favor of the money power by distinguished zeal and devotion in its service, The result of the ill-advised legislation which established this great monopoly, was to concentrate the whole moneyed power of the Union, with its boundless means of corruption, and its numerous dependents, under the direction and command of one acknowledged head; thus organizing this particular interest as one body, and securing to it unity of action throughout the United States, and enabling it to bring forward, upon any occasion, its entire and undivided strength to support or defeat any measure of the government. In the hands of this formidable power, thus perfectly organized, was also placed unlimited dominion over the amount of circulating medium, giving it the power to regulate the value of property, and the fruits of labor in every quarter of the Union; and to bestow prosperity, or bring ruin upon any city or section of the country as might best comport with its own interests or policy.

    “We are not left to conjecture how the moneyed power, thus organized, and with such a weapon in its hands, would be likely to use it. The distress and alarm which pervaded and agitated the whole country, when the Rank of the United States waged war upon the people in order to compel them to submit to their demands, cannot yet be forgotten. The ruthless and unsparing temper with which whole cities and communities were oppressed, individuals impoverished and ruined, a scene of cheerful prosperity suddenly changed into one of gloom and despondency, ought to

    be indelibly impressed on the memory of the people of the United States. If such was its power in a time of peace, what would it not have been in a season of war, with an enemy at your doors. No nation but the freeman of the United States could have come out victorious from such contest; yet, if you had not conquered, the Government would have passed from the hands of the many to the hands of the few; and this organized money power, from its secret conclave, would have dictated the choice of your highest officers, and compelled you to make peace or war, as best suited their own wishes. The form of your Government might for a time have remained, but its living spirit would have departed from it.”

    The wise counsel coached in these golden words of President Jackson are now more applicable than when uttered by him.

    In the election of 1836, Martin Van Buren succeeded Jackson in the presidency. The panic engineered by the bank enveloped the people, and the whole system of credit built up by it fell with a crash. In fact the bank had so shrewdly manipulated the volume of money, and so absolute was its control over it, that society had resolved itself into two classes, a creditor class, small in numbers, but powerful in influence; a debtor class, constituting a great majority of the people, but helpless in the grasp of the creditor class.

    One was the master, the other the servant.

    During the administration of Van Buren, the Independent Treasury Bill became a law.

    Thus the work begun by Jackson in crushing the bank, was consummated by the separation of the public moneys from those of the banks – a most salutary reform.

  18. @Joanne – I think I posted both Pasillas and Levya at scribd. I’m afraid I think Veal has some fangs that appear as teeth.

  19. @Christine – you said,
    “If you do some research, you’ll see that more judges have recently agreed that, when MERS is involved in any mortgage transaction, there is no meetings of the mind and the contract is void.” ???????????
    Can you refer me to such a decision?

  20. @E Tolle, TN HARRY, ANONYMOUS.

    I just posted all cut and paste from credit info center dotcom.

    My research that I share with those here. A real live example. Something I have been searching for.

    As Neil says, the people will win. The price of freedom is constant willingness to fight back. It’s just a game of rules………………ethics, morals, I don’t think so, it’s their rules, use them I guess.

  21. I just got the mail today & I received their response to my request for production of documents & things. It looks like they filed the response 3 days prior to the expiration of their allowed response time….by the skin of their teeth

    Here’s how they responded:

    COMES NOW Plaintiff, Midland Funding, LLC, by and through its counsel, Douche bag & Douche bag, pursuant to Missouri Rules of Civil Procedure, and for their responses to Defendant’s First Request For Production of Documents Directed to Plaintiff states the following:

    1-13. Copies of any and all documents in Plaintiff’s care, custody and control are attached hereto and incorporated by reference in response to Defendant’s Request for Production of Documents.

    Signed, w/certificate of service stamp etc…..

    The documents they include are laughable at best which is apparently the same thought their lawyer had a few days ago when my file came across the desk. It was basically just a few statements w/acct numbers & 1 chain of custody sale but absolutely nothing that would prove their allegations were valid. I got a little wink & nod from their attorney when I asked if they were gracious enough to dismiss w/prejudice Good feeling for the little guy!

    Now my thinking here is to expand my little experience with a civil suit against the JDB…indulge me if you will:

    If the JDB here was unable to prove that my wife owned this account & bailed out of the lawsuit prior to being embarrassed at trial in open court, i’d imagine they wouldn’t be in a good position to defend a lawsuit for reporting fraudulent negatively damaging information to the credit reporting agencies.

    What do you think? My assumption is that they would be looking at a $1000 violation for each listing on each CRA file + court costs & punitive damages deemed necessary and reasonable by the court. I could be jumping the gun here but I would imagine they would not have any defense that could win with…if no agreement exists to be brought into evidence, what defense is there?

    We shall see as I fully intend to research & file suit. Thanks to the DCCRS community for all of the support & assistance that has gotten me this far. When people join together in a community to share information for the greater good, as you’ve all seen, good things happen.

    +1 for the little guy!

  22. Anyhow, in missouri….before you can file a motion to compel, the law indicates that the party filing the motion has to make an attempt to contact the plaintiff/defendant for production of the requested documents etc…this basically just means you have to give their office a call & ask. At the same time, you send them a fax documenting the communication so you have proof to show the court you not only filed your request for production of documents and things but you also made a notable attempt to contact the plaintiff prior to being forced to ask the court to grant your motion to compel. The following is the letter I typed up this morning prior to leaving for court which I intended to give to their attorney prior to filing my motion to compel tomorrow.

    Jane Doe
    9999 pim Street
    City, state. zip
    February 17, 2009
    lawyers name, Attorney for
    Plaintiff, Clients name

    Mr. Douchebag attorney:
    This communication is a follow up to my previous Request for a Production of Documents and Things on civil case no. 000001 which was served upon your office by means of certified mail with a certificate of service filed with the court dated January 15th 2009. As of today, February 17th, I have received no response from your office regarding this request which I, as a Defendant, am entitled to per Missouri Civil Rule 58.01.
    This communication is my final effort to receive the cooperation of your office in this matter to inspect and copy the requested documents so that both parties may proceed forward in this case before the court. Should you fail to comply with this request, I will be forced to exercise my rights as a Defendant under Missouri Rule 61.01(d) & file a motion to compel with the court to receive your compliance with the rules of Discovery. I look forward to hearing from your office.


    Date: 2/17/2009

  23. It was indeed a circus. To see literally hundreds of people being taken advantage of by 4 lawyers representing the same dirt-bag clients was too much for me. It was really like I was on some legal drama episode it was so surreal that so much money was changing hands without even a fight out of these defendants. They constantly request continuances trying to draw out the court case so you’ll hopefully default. I’ve read that dv is not useful after a lawsuit has been filed but I do agree with you….if the lawsuit is the first time you’ve received a demand for payment from a CA then under the FDCPA, your dv request technically is still valid which is why I did make an attempt. I faxed a copy of the dv request w/ the order to cease & desist which obviously I cannot prove the received in the same manner I could if I had sent it certified mail but nonetheless, when we arrived in court, the lawyer acknowledged she could not speak with us b/c there was a cease & desist on file so they DID receive it. They just chose not to respond b/c they don’t have anything. One question I have for the pros here is if you have a cease & desist in effect & their attorney tries to mediate with you by means of offering up a default plea, does this constitute an FDCPA violation? I was under the impression that a solicitation for a plea bargain would constitute “contact” which would in turn be a violation of the FDCPA, right? I’ve still got a copy of their offer for default which I will bring into court if I do indeed have a violation to collect on. BTW, this happened at the 2nd court date…apparently the 2nd lawyer (or paralegal) we spoke with initially ignored the cease & desist & tried to solicit my wife out of a signature for a default judgment. After their lawyer explained what she was trying to solicit I reminded her of the cease & desist order & she then suddenly remembered that she wasn’t supposed to be talking to us. What do ya think? Is that offer “proof” that a violation took place?

  24. @E.Tolle

    It was indeed a circus. To see literally hundreds of people being taken advantage of by 4 lawyers representing the same dirt-bag clients was too much for me. It was really like I was on some legal drama episode it was so surreal that so much money was changing hands without even a fight out of these defendants. They constantly request continuances trying to draw out the court case so you’ll hopefully default. I’ve read that dv is not useful after a lawsuit has been filed but I do agree with you….if the lawsuit is the first time you’ve received a demand for payment from a CA then under the FDCPA, your dv request technically is still valid which is why I did make an attempt. I faxed a copy of the dv request w/ the order to cease & desist which obviously I cannot prove the received in the same manner I could if I had sent it certified mail but nonetheless, when we arrived in court, the lawyer acknowledged she could not speak with us b/c there was a cease & desist on file so they DID receive it. They just chose not to respond b/c they don’t have anything. One question I have for the pros here is if you have a cease & desist in effect & their attorney tries to mediate with you by means of offering up a default plea, does this constitute an FDCPA violation? I was under the impression that a solicitation for a plea bargain would constitute “contact” which would in turn be a violation of the FDCPA, right? I’ve still got a copy of their offer for default which I will bring into court if I do indeed have a violation to collect on. BTW, this happened at the 2nd court date…apparently the 2nd lawyer (or paralegal) we spoke with initially ignored the cease & desist & tried to solicit my wife out of a signature for a default judgment. After their lawyer explained what she was trying to solicit I reminded her of the cease & desist order & she then suddenly remembered that she wasn’t supposed to be talking to us. What do ya think? Is that offer “proof” that a violation took place?

  25. cubed2k, a very cogent telling of the tale involving Midland. Been there done that….on behalf of a friend. Let’s see….I understand your not wanting to go into detail, but I have to ask because I’m sure I already know the answer….did the law firm have an M and a K in the name?

    Ruthless should be their middle name….actually I have a lot stronger term than that….I’d bet you know what I mean.

  26. If you’re in the position of being sued I know how you feel and this all seems overwhelming but it is easily managed by a sharp individual. Each state has a particular way that they want a motion formatted which you can find on your states supreme court website…they list all the civil court rules there. What I did was simply copy the JDB’s own format & used it as a template for my motions (gotta love MS word)….that gets that tough part out of the way & I thank them for that

    When you do some reading here, you’ll see how people respond to these requests from the plaintiff & all you have to do is copy their format & insert your motion in the body of the text. Trust me, it makes the task of filing a motion much less daunting when you have a header / footer template already setup. For instance, with their motion for production of documents and things, I copied almost exactly their motion & redirected it back to them (obviously some important things must be modified first such as which documents you want them to produce) which was really pretty easy. Remember this formula next time you deal with an attorney:

    50% of lawyering is intimidation, 40% paperwork, & 10% law.

    Once you deal with the intimidation you’re pretty much halfway there! Personally I live in a large city with a high crime rate so douche bag attorneys with snotty attitudes aren’t exactly the ingredients of fear for me.

  27. The whole process of these Junk Debt Buyers suing in civil court & using the process of discovery to obtain default judgments is an enormous perversion of the justice system. They hope you’ll either cave in get scared & sign a default judgment, you won’t comply & they’ll get a default judgment, or you’ll incriminate yourself by providing documents or statements to support their case that they otherwise could not win without (i.e. DON’T GIVE THEM ANYTHING…DON’T LAWYERS ALREADY MAKE ENOUGH MONEY? WHY MAKE THEIR JOB EASIER?). Now we turn the tables on the dirtbag lowlife JDB. The neat thing about discovery is it’s a 2 way street. As a Defendant, you can direct a motion for production of documents and things directed to the Plaintiff which would obviously include a request for the original signed contract between the plaintiff & the defendant (which they won’t have)…etc…. you get the point. They then have 30 days to comply with that request & if they don’t comply you can then file for a motion to dismiss due to the plaintiff’s non-compliance with the discovery process. If you don’t get the dismissal right then and there, you file a motion to compell discovery which is a court order for the Plaintiff to produce said documents. Obviously they can’t produce them so about a week after you file the motion to compel if the plaintiff hasn’t already done the smart thing & dropped the case, you file another motion for dismissal with prejudice & you’ll get it. But i’m getting ahead of myself here, read on and you’ll see my production of documents directed to the plaintiff.

  28. Money Talks: BAC stocks continue to go lower.


    Even though the Stock Market rose 300+ points.

    At least this Judge can recognize the shift in the wind.


  29. Sorry the format got really jumbled when I copied & pasted from ms word but you get the context of what needs to be stated in that response. Now I will show you how I complied with the request for interrogatories & admissions. Remember, if you don’t respond within 30 days (or as your states laws requires), all allegations the plaintiff makes are accepted as FACT without ANY PROOF. You MUST comply & respond. The questions they ask are along the lines of, “A contractual agreement between Plaintiff and Defendant existed where Plaintiff loaned xx amount of money to Defendant & defendant defaulted”….obviously that is something you don’t want to allow to be accepted as factual without any proof so you MUST COMPLY! Here is my response:

    xxxXXXXXXX )
    ) Case No: 1111111111
    Plaintiff, ) Division: 11
    Vs )
    JANE DOE )
    Defendant. )
    Defendant, appearing pro se, for its Response to Plaintiff’s First Set of Request for Admissions and Interrogatories states as follows: All Answers correspond to the numbered paragraphs of the Complaint. All allegations of the Complaint are denied unless expressly admitted herein.

    REQUEST ONE DENIED – INTERROGATORY ONE: Defendant at this time does not have sufficient knowledge or information to form a belief as to the truth of the allegation contained therein, and leaves the Plaintiff to provide proof. Defendant demands strict proof thereof.


    REQUEST THREE DENIED – INTERROGATORY THREE: Defendant is at this time without knowledge or information sufficient to form a belief as to the truth of the allegation contained therein, and leaves the Plaintiff to provide proof. Defendant demands strict proof thereof.

    REQUEST FOUR DENIED – INTERROGATORY FOUR: This request calls for admission of matter defendant has denied and thus it is improper.

    REQUEST FIVE DENIED – INTERROGATORY FIVE: This request calls for admission of matter defendant has denied and thus it is improper.

    REQUEST SIX DENIED – INTERROGATORY SIX: This request calls for admission of matter defendant has denied and thus it is improper.

    REQUEST SEVEN DENIED – INTERROGATORY SEVEN: This request calls for admission of matter defendant has denied and thus it is improper.

    REQUEST EIGHT DENIED – INTERROGATORY EIGHT: This request calls for admission of matter defendant has denied and thus it is improper
    REQUEST NINE DENIED – INTERROGATORY NINE: This request calls for admission of matter defendant has denied and thus it is improper.

    REQUEST TEN DENIED – INTERROGATORY TEN: Defendant at this time does not have sufficient knowledge or information to form a belief as to the truth of the allegation contained therein, and leaves the Plaintiff to provide proof. Defendant demands strict proof thereof.

    REQUEST ELEVEN DENIED – INTERROGATORY ELEVEN: Defendant at this time does not have sufficient knowledge or information to form a belief as to the truth of the allegation contained therein, and leaves the Plaintiff to provide proof. Defendant demands strict proof thereof.

    Jane J. Doe
    By: _______________________________
    Jane J. Doe, Defendant
    9999 Pine Street
    City, St. 99999


    The undersigned certifies that the above documents were served on all parties in the above cause by depositing an original and one copy in the U.S. Mail, postage prepaid, in an envelope addressed to: LAW OFFICES address to law office etc…. 100 ST. LOUIS, MISSOURI 63132, on 1/1/00.

  30. 1: if your responses in any way indicate your assumption that the debt is yours, you just screwed yourself (such as disputing the amount etc….you just admitted the debt is yours, now you’re just disputing amount). 2: if you fail to comply with the request for production of documents within the 30 days as required by law, the plaintiff will file for a motion for default judgment & they will win b/c you failed to comply. In 99% of cases, this motion for production of papers will win their case by nailing 1 of those 2 points. YOU MUST COMPLY AND YOU MUST NOT ADMIT ANYTHING. MAKE THEM PROVE THEIR CASE! So here is my response to their production for documents:

  31. I’ll provide a brief summary to get ya up to speed:

    Midland funding approx. 2 months back filed a complaint with 2 counts. 1 count is “FOR MONEY LOANED” and the 2nd count is for “ON ACCOUNT”. I do not want to post too much detailed information about this suit for obvious reasons but the amount they’re suing for is under $1000. I am not being sued by the original creditor though, I am being sued by a junk debt buyer (midland funding) on behalf of their attorney.

    So I and my spouse appeared in court & watched 95% of all the defendants suffer a default judgment. Basically what happens is the court clerk / bailiff calls all the names on the docket. When you hear your name and you say “here”, their lawyer just found out they aren’t getting a default judgment out of you (at least not yet) b/c you actually chose to show up & since 99% of the time they don’t have the evidence it takes to win a judgment in a bench trial they will respond by saying “second call” as opposed to “ready for trial”.

    After all the names are announced the judge leaves the room and all the lawyers are seated at 4 tables in the corral (in front of the court). 1 by 1 the lawyers call up the people they’re suing and the court allows these lawyers at this point to harass each and every defendant in an attempt to pressure them into waiving their right to a bench trial & signing a consensual default judgment. Pretty sweet deal for the lawyers ehhh?

    Don’t even have to prove a case….just pressure people who don’t know any better and disgustingly I watched one by one people signing away their rights without so much as a whimper. It about made me want to puke. As soon as we were served with the complaint, I immediately searched & found this site where I obtained a nice Debt Validation letter coupled with an order to cease & desist. I know at the point you’re being sued dv is useless but since this complaint is the first demand for payment i’ve received I figured i’d still give it a shot.

    By the way, on the complaint they included an “exhibit” which is apparently their proof that a contract exists which is nothing more than an acct # & a total $$ with the defendants name…..very laughable. Anyways when our name was called, we approached the lawyers corral & snidely the attorney looked at the file & saw the cease & desist order & immediately pulled out a “waiver” which she asked my spouse to sign so we could “talk”.

    I instructed my spouse to decline in front of the attorney & said since your client has not been able to comply with the debt validation, we have nothing to discuss. She tried to cut me off in the midst of speaking as a lame attempt to annoy me since I ruined her little hot streak of defaults…she looked at us as if we were stupid for not wanting to talk to her. It was the first time in my life I truly felt like somebody tried to insult my intelligence but then again, most people are stupid so I guess I can see their angle working most of the time.

    So we turned to walk away and she stopped us and rudely said, “well do you want a copy of your continuance date or not”…as I smiled politely, I said that’d be great. They continued it for 1 month to try to maneuver a default judgment out of us & I will explain in detail how they do this. (just showing up for court as a defendnat isn’t enough!). About a week later, we were served with a request for production of papers & things as well as a request for written interrogatories. These are fancy words for discovery which they use for 2 purposes to win. The production of papers is basically a list of papers they want you to produce such as correspondence you’ve had with the original creditor or collection agency and basically any other piece of paperwork under the sun that might prove their case.

    So in a nutshell, they’re basically saying…”hey, MR. defendant…since we don’t actually have any evidence against you to win in front of a judge right now….would you be so kind as to incriminate yourself by sending us these documents that we don’t have & can’t prove that you have….sooo if you could just be a doll & send those documents right over that’d be just great!”. Now the purpose this serves for the plaintiff is that two pronged: 1: if your responses in any way indicate your assumption that the debt is yours, you just screwed yourself (such as disputing the amount etc….you just admitted the debt is yours, now you’re just disputing amount). 2: if you fail to comply with the request for production of documents within the 30 days as required by law, the plaintiff will file for a motion for default judgment & they will win b/c you failed to comply. In 99% of cases, this motion for production of papers will win their case by nailing 1 of those 2 points. YOU MUST COMPLY AND YOU MUST NOT ADMIT ANYTHING. MAKE THEM PROVE THEIR CASE! So here is my response to their production for documents:

  32. A demurrer is a type of motion that can be filed with the court instead of filing an answer. The deadline for filing is the same as your answer. The arguments in this demurrer specifically address a complaint for breach of contract where NO EXHIBITS ARE ATTACHED. Generally, the contract is required to pursue a breach of contract claim, so they won’t be able to proceed with their case until they present the contract to the court

  33. here’s the rest of the brief (it wouldn’t fit in one msg!)

    B. Plaintiff’s Claims for Breach of Contract and Common Counts Fail as a Matter of Law

    In order to make out a claim for breach of contract, Plaintiff must plead the contract, its performance of the contract or excuse for nonperformance, Defendant’s breach and the resulting damage. (Lortz v. Connell (1969) 273 Cal.App.2d 286, 290.)

    Here, Plaintiff fails to plead the terms of the alleged agreement between the parties or to attach a copy of the alleged agreement to the Complaint. Instead, Plaintiff alleges a written agreement was entered not on a specific date but rather “within the last four years.” (See Complaint at p. __, ¶ ___.) Plaintiff then merely inserts the following boilerplate language claiming it constitutes the essential terms of this alleged contract:

    “Plaintiff, or Plaintiff’s assignor, and defendants, and each of them, entered into a written agreement. By the terms of the said agreement(s), plaintiff provided defendants, and each of them, with [services rendered] and/or [goods, wares and merchandise] and/or [extension of credit] and/or [monies paid laid out or expended] at defendant(s) request.”
    (See Complaint at p. __, ¶ ___.)

    If the action is based on an alleged breach of a written contract, the terms must be set out verbatim in the body of the complaint or a copy of the written instrument must be attached and incorporated by reference. (Wise v. Southern Pacific Co. (1963) 223 Cal.App.2d 50, 59, emphasis added; Otworth v. Southern Pacific Transportation Co. (1985) 166 Cal.App.3d 452, 458-59.)

    It is clear from the face of the Complaint that the above boilerplate language is not from any finalized written agreement but rather sample contract terms designed to be tailored to a specific agreement, hence the bracketed terms where the essential elements are meant to be placed. Not only is inserting language from some sort of sample contract inartful, Plaintiff’s inclusion of the same highlights the falsity of its claims.

    Similarly, under a cause of action for common counts on open book account and account stated, Plaintiff alleges as follows:

    “By the terms of the said agreement(s), Plaintiff or Plaintiff’s assignor, provided defendants, and each of them, with services rendered and/or goods, wares, and merchandise and/or extension of credit at defendant’s special instance and request and in consideration thereof defendants promised to provide payment in the sum of $_________ and interest thereon which defendants and each of them failed to provide.”
    (Complaint at p. ___, ¶ ____.)

    Based on the foregoing, Defendant is wholly unable to ascertain whether a contract actually exists or what precise terms were purportedly breached. This wholesale failure to allege the verbatim terms of the contract, or to attach the agreement, thus renders Plaintiff’s breach of contract/common counts claim fatally defective.

    C. The Demurrer Should be Sustained Without Leave to Amend Since There is No Reasonable Possibility Plaintiff Can Cure The Defects

    A demurrer must be sustained without leave to amend absent a showing by the plaintiff of a reasonable possibility that the defect can be cured by amendment. (Blank v. Kirwan (1985) 39 Cal.3d 311; Lacher v. Superior Court (1991) 230 Cal.App.3d 1038, 1043.) The burden of proving such reasonable possibility is squarely on the plaintiff. (Torres v. City of Yorba Linda (1993) 13 Cal.App.4th 1035, 1041; Blank, 39 Cal.3d at 318; see also, Lacher, 230 Cal.App.3d at 1043.)

    Here, Defendant’s demurrer should be sustained without leave to amend since there does not appear to be any reasonable possibility that Plaintiff can amend its Complaint to overcome demurrer. If Plaintiff, who presumably is aware it carries the burden of proof, possessed the alleged contract with Defendant, it is unlikely that Plaintiff would have simply neglected to attach it. Its failure to do so is evidence of the fact that no contract between the parties has ever existed. Its failure to plead the requisite “essential terms” of the alleged contract – let alone any of the terms whatsoever – is further evidence that no contract exists and that Plaintiff’s Complaint is without merit.

    Having established that it does not have any written agreement with Defendant, and having established that it is not aware of when the purported agreement was entered into, whether it was for goods, services, credit or otherwise, Plaintiff cannot, in good faith, amend to cure such defects. Leave to amend should, therefore, be properly denied.


    For the foregoing reasons, Defendant respectfully requests that the demurrer to Plaintiff’s Complaint, in its entirety, be sustained without leave to amend.

  34. A demurrer is a type of motion that can be filed with the court instead of filing an answer. The deadline for filing is the same as your answer. The arguments in this demurrer specifically address a complaint for breach of contract where no exhibits are attached. Generally, the contract is required to pursue a breach of contract claim, so they won’t be able to proceed with their case until they present the contract to the court.

    Here’s the meat of the brief:



    Defendant ______________ (“Defendant”) respectfully submits the following Memorandum of Points and Authorities in support of her General Demurrer to Plaintiff Midland Funding LLC’s (“Plaintiff”) Complaint.

    On ___________________, Plaintiff filed the instant suit for monetary damages in the sum of $____________. In its Complaint, Plaintiff claims this amount accrued under a written agreement between the parties. Plaintiff’s Complaint, however, is fatally flawed. Plaintiff neither attaches a copy of the purported agreement with Defendant to its Complaint, nor pleads any of the essential elements of the alleged contract. The lack of a contract or, alternatively, a recitation of its terms, leaves Defendant completely in the dark as to the basis of the claim being asserted against her by an entity which is completely unknown to her. Plaintiff conspicuously fails to provide information regarding the date the purported contract was entered into or even the subject of the contract (i.e., whether for goods, services, credit, etc.).

    Not only does Plaintiff’s vague pleading fly in the face of the interests of justice, such pleading is prohibited by statute. As set forth in more detail below, Plaintiff has wholly failed to meet its statutory obligations under California Code of Civil Procedure [“CCP”] Section 430.10(e), and it is respectfully requested that the Court sustain Defendant’s demurrer without leave to amend since it appears that there is no reasonable possibility that Plaintiff can cure the fatal defects.


    A. A Demurrer is Properly Sustained Where a Pleading Fails to State Facts Sufficient to Constitute a Cause of Action

    A general demurrer is proper when the complaint fails to allege facts sufficient to constitute a cause of action. (CCP § 430.10(e).) To determine whether a complaint fails to allege sufficient facts, a demurrer must challenge defects that appear on the face of the complaint. (Id., § 430.30(a).) The “face of the complaint” includes matters shown in exhibits attached to the complaint and incorporated therein by reference and matters of which the court may take judicial notice. (Ibid.; Frantz v. Blackwell (1987) 189 Cal.App.3d 91, 94.) If upon consideration of all facts stated it appears that plaintiff is not entitled to the relief sought, the complaint or any causes of action therein will be held invalid. (Songer v. Cooney (1989) 214 Cal.App.3d 389, 390.)

    It is well settled that a plaintiff must set forth specific facts in a complaint so that the defendant may plead intelligently and responsively to the pleading without having to guess or speculate as to the items of material or essential facts. (See Ankeny v. Lockheed Missile & Space Company (1979) 88 Cal.App.3d 931, 937.)

    In the instant action, Plaintiff’s entire Complaint is subject to demurrer because it fails to state facts sufficient to constitute causes of action for common counts (First Cause of Action) or breach of contract (Second Cause of Action). (Code Civ. Proc. § § 430.10(e).)

    This is a pretty powerful tool, and a good preemptive strike. Most states allow it.

    Joe Blow
    Address 1
    City, State ZIP
    Phone (555) 555-1212


    Case No.: XXXXXX


    Investment Retrievers Inc.,


    Joe Blow,


    Comes now the Defendant Joe Blow, and files this Objection to Complaint, per California Civil Code Chapter 4 Section 430.30.

    1. Defendant received the Plaintiff’s Complaint on or about December 1, 2005. Defendant answered the complaint on or about December 28, 2005.

    2. On or about January 17, 2006, Defendant filed a motion to strike because nearly all of the complaint contained false information (motion to strike complaint California Civil Code of Procedure 436 (a)).
    We claim the false information based on the following facts:

    (a) The Plaintiff has failed to provide any contract or agreement bearing the signature of the Defendant, nor any itemized statements or billing of said debts.

    (b) Plaintiff has failed to provide a detailed list of the debts to the Defendant in the initial debt collection notice as require by the FDCPA and as evidence by case law. Coppola v. Arrow Financial Services, 302CV577, 2002 WL 32173704(D.Conn., Oct. 29, 2002) – Information relating to the purchase of a bad debt is not proprietary or burdensome. Debtor must phrase their request clearly to obtain: The source of a debt and the amount a bad debt buyer paid for plaintiff’s debt, how amount sought was calculated, where in issue a list of reports to credit bureaus, and documents conferring authority on defendant to collect debt.

    (c) The Plaintiff has failed to provide any proof of a relationship between themselves and the alleged original creditor, specifically the authority of the Plaintiff to collect the debt on behalf of the original creditor.

    3. On or about Feb 1, 2006, Plaintiff filed an opposition to the Defendant’s motion to strike. The hearing for the motion to strike was set for Feb 15, 2006.


    4. The Defendant, in addition to the motion to strike, would like to file an objection to the original complaint based on California Civil Code of Procedure 430.10. The party against whom a complaint or cross-complaint has been filed may object, by demurrer or answer as provided in Section 430.30, to the pleading on any one or more of the following grounds:
    430.10 (b) The person who filed the pleading does not have the legal capacity to sue.
    430.10 (d) There is a defect or misjoinder of parties.

    In regards to Section 430.30 (b), Incapacity to sue exists when there is some legal disability, such as infancy or lunacy or a want of title in the plaintiff to the character in which he sues. In this case, as stated in the motion to strike, the plaintiff has failed to provide a definitive relationship between themselves and the alleged original creditor of the alleged debt.

    In regards to Section 430.30 (d), The legal definition of misjoinder of parties is the “joining as plaintiffs or defendants, persons, who have not a joint interest”. In this case, as stated in the motion to strike, the plaintiff has failed to provide a definitive relationship between themselves and the alleged original creditor of the alleged debt.

    WHEREFORE, Defendant, XXXXXXXXXX, respectfully submits that the Court should dismiss or deny the Plaintiff’s complaint, filed herein Palisades Collections, Inc. The Defendant prays for Dismissal of the complaint by the Plaintiff.

    Defendant’s Request submitted this ___________ day, of __________ 20__
    What is the Colorado civil procedure code for the same thing?
    Don’t see it anywhere.

    (I wish we had a list for every state in the USA’s exact civil codes for this so all we had to do was look it up here. It is really hard to try and find it when your new to the legal arena.)

    PS Thank you LUEser for the megapast. I think yours is also located here http://debt-consolidation-credit-rep…d.php?t=210981.
    I just meant for the specific civil code for each state reguarding California Section 430.30 ,so it isn’t hard to look it up.I find it hard myself.




    Joseph Consumer

    Case No._____________________


    COMES Now Defendant, xxxxxxx, and files this Request for Production of Documents, and requests the Court to grant such Motion based on facts stated below:

    “Document” means any written, recorded or graphic matter, whether produced, reproduced or stored on papers, cards, tapes, belts, or computer devices or any other medium in your possession, custody or control, or known by you to exist, and includes originals, all copies of originals, and all prior drafts. It includes all original business records, non-identical copies, computations, memoranda of oral or telephone conversations, tabulations, records of correspondence, notes made on other documents, microfilms, etc. A request to identify a document is a request to state as applicable:

    1. The date of the document;
    2. The type of document;
    3. The names and present addresses of the person or persons who prepared the document and of the signers and addressers of the document;
    4. The name of the employer or principal whom the signers, addressers and preparers were representing;
    5. The present location of the document;
    6. The name and current business and home addresses of the present custodians of the original document, and any copies of it;
    7. A summary of the contents of the document; and
    8. If the original document was destroyed, the date and reason for or
    circumstances by which it was destroyed.

    1. The alleged credit application from “”Account””, bearing the plaintiff’s signature;

    2. The alleged credit agreement from “”Account”” that states interest rate, grace period, terms of repayment, et cetera;

    3. Itemized statements or credit card statements from “”Account”” that demonstrate how the alleged amount of $X,XXX was calculated;

    4. A contract, agreement, assignment, or other means demonstrating that XXXX. had the authority and capacity, and was legally entitled to collect on the alleged debt from “”Account””;

    5. Letter(s) sent to plaintiff by XXXX., demonstrating an attempt to collect on the alleged debt, “”Account””;

    6. A notarized statement, if presently existing or otherwise, by a person with original knowledge of the alleged debt, as it was constituted, and who can testify, or be so interrogated in a deposition, that the alleged debt was incurred legally;

    7. Any and all further documents that you believe establish that plaintiff had an outstanding account or debt related to “”Account””;

    8. Any further documentation, beyond what has been previously requested, that clearly establishes plaintiff’s liability and/or responsibility to the alleged debt;

    9. Any and all written communication, received by the defendant from the plaintiff, regarding the reporting of the alleged account to any credit reporting agency, as well as defendant’s accessing of plaintiff’s credit report(s).

    10. Any and all communications from defendant to the plaintiff explaining
    why defendant reported the alleged debt to any credit reporting agency, as well as obtaining plaintiff’s credit report(s);

    11. Any and all credit report(s) defendant obtained from any credit
    reporting agency concerning the plaintiff;

    12. Any and all notes, memoranda, or likewise, be they handwritten,
    computerized, or typed, regularly kept in the normal transaction and
    business of collecting debts, that relate to the plaintiff and/or

    13. The defendant’s Articles of Incorporation;

  37. New York Attorney General Kicked Off Government Group Leading Foreclosure Probe


    “…These attorneys general have said they’re reluctant to sign on to an agreement that effectively kills their ongoing investigations or prevents new ones from being launched. Beau Biden, Delaware’s top law enforcer, remains on the states’ executive committee.

    In a statement of support for Schneiderman, Biden said that the “events leading up to the mortgage crisis must be fully investigated, including origination and securitization practices, before any broad immunity is granted.”

    “The American people deserve an investigation,” he added.

    Top Obama administration officials recently reached out to Schneiderman and his allies, effectively requesting he get in line, people familiar with the discussions said. The New York Times editorial board on Tuesday declared that Schneiderman “should stand his ground in not supporting the deal.”

    “The administration says that a settlement would quickly deliver much needed relief to hard-pressed borrowers, but it’s doubtful it would provide redress on a par with the banks’ wrongdoing or borrowers’ needs,” the board wrote.”


  38. This old blogg came to me with a new comment and boy did it tick me off. Sqeek your wheels and go after these banksters.
    39 Responses
    Shelley A. Erickson, on August 23, 2011 at 6:48 pm said:
    Get Good look at the Wall street and the financial Crisis;Anatomy of a Financial Collaspe., It has a lot of answers to Freddie amd Fannie and who did what. The OCC is as crooked as the banksters. But they are getting more into checking things out, being in the hot seat. You will see just how the banksters did what they did and the documented proof and who is in jail over this? None yet. I hope we put them all in jail. I dont know if stop whinning saw the thousands of families in the streets on 60 minutes, but this is a sinister crime, not the normal. How dare this party tell us to quit whinning. Wine and squeek you wheels, this is a horrific crime against Americans. We must use every tool to stop this if it is show me the note. The S.O.B’s made me angry. No decent human being would look at this crime against Americans in the thousands and not be in total shock and sick at heart .. To be so heartless, he has no soul. He has to be a narsictic banker, or closely related to the devil.

    Shelley A. Erickson, on August 23, 2011 at 6:37 pm said:
    Directly to stop whinning: We took out a loan in good faith trying to weather the economy caused by bad faith banks trying to dupe the borrowers,and the investors and the insurance companies, causing an economy that was spiralling down due to their scams. I was duped by the mortgage broker who was paid kick backs and bribes to suck me into a arm loan, when I came to the desk expecting a flat interest rate loan, then tells me the loan is easily refinanced before the interest rate goes up in five years, concealing the payments would accellerate from 2400.00 a month to 4800.00 a month in a short time preplanned for default by the banksters who brag in the Wall Street and the Financial Crisis; anatomy of a Financial Collaspe” senate report, in their e-mails, that the borrowers were unknowingly preset for rapid default, and how they were looking for dupes (investors) to purchase the defaulted or rapid defaulting mortgages, insider trading and betting on their own products to default making billions off our pain and suffering and the duped investors pain and suffering. You must be a banker or a bankers employee. The economy has plummetted due to this crime. My salon business is down over a hundred thousand [net] a year over the banks crimes. People I know in the thousands have lost jobs and businesses and homes due to these banksters. After being told by the servicers, three different servicers to default, is the only time i defaulted. They claimed it was the only way I could qualify in a spiralling down economy to get relief and receive a mod loan. I paid for five months on this approved mod loan after ten months of greuling effort to get all the paper work through the fax. I was told the mod payments were now going to be considered partial payments due to the O’Bamma changes. I had to come up with over twentyfive thousand I was in foreclosure. This is not good faith or honest service. I suggest you read the Wall street and the Financial Crisis. If you still think the way you do and see thousands of families being tossed in the streets then I expect you have sold your soul to the devil and there is no reason to waste another breath on you. Just wish you the same you wish us. We have been duped, screwed and taken to the cleaners by these banksters and if you are one of them I am sorry for your soul take it up with GOD.

    Stop Whining, on August 22, 2011 at 3:37 pm said:
    Let me get this straight, homeowners who rightfully and knowingly have signed a contract and a legal promissory note are now blaming the banks for their unwillingness to pay back the loan. They are scamming banks by saying “show me the note.” You knowingly under your own content signed a promissory note to pay back the loan. Hence that is a legal contract, a PROMISE. Who cares where the note was sold. I don’t care if a pile of dirt owns the note, you have a legal obligation and contract to pay back the note or you should go through foreclosure. What a scam, you should not have the right to get a loan! You know you owe money on a loan, yet you try and intentionally deceit the lender by saying “show me the note”. Last time I checked that is fraud: intentional deception made for personal gain!

    getgood, on May 12, 2011 at 8:13 am said:
    The threads are old now, but I would like to see if anyone is still active and can comment. I have 2 properties, but were closed mid 2007 with table funding lenders, one of which I know was an REIT, since I worked for them. Both went quickly to be serviced by Countrywide, and then BOFA where they are still being serviced. Both loans have been identified with Freddie Mac as being the investor. I have stopped paying on both properties, as I was trying to work out a modfication, which was an awful experience with BOFA. BOFA is still open to re-visiting a modification, but I have asked for proof of the investor/owner of the original note, and they are avoiding my direct questions about this. I keep sending letters to please provide proof so that I know I am dealing with the legal owner. I have filed complaints with the OCC on both as well. I am close to filing a Chap 13 and can dispute the proof of claim through this, and there is favorable court opinion to compel this, here in Washington State. No NOD’s have been served yet. If Freddie Mac says they are the owner, they have very specific language on their website about holding the physical note and procedures for holding it. Has anyone heard of Freddie Mac not being able to produce the note? I am curious to know if Freddie became the owner when I closed this loan. I have requested this information from Freddie and BOFA with no responses yet.

    mary fitz, on November 7, 2010 at 3:13 am said:
    We bought our house in 2003 in Colorado. The mortgage broker on the purchase was supposed to assign the mortgage at settlement or shortly thereafter to Wells Fargo. On our credit report, in the title work, and recorded with the municipality is the mortgage broker. Wells Fargo cannot produce anything other than a stamp on the note saying it was assigned. Is there any way we can benefit from this?

    Bart, on November 2, 2010 at 2:51 pm said:
    I just recived a copy of 2 notes for one ,both with different terms and rate just to add to the confusion but it is clear that the note is void. The Mortgage and note were separated and the note stayed with the 2nd “originator” as I have evidence of an originator prior to this now defunct one that was not recorded. Anyway, the copy has a plain page with a stamp in the upper right hand courner with an “employee’ of this defunct company signature to a 3 line fill in the blank spot that has been left blank with no date and the wording without recourse on it. So, the note “died” with the defunct company and this is why there has never been an assignment on record. This was more than I expected to receive as I used a dunning notice on the newest “company” to pick this up and try to get something from it. I can bet the other ones are the same. So evidence is pointing that the fed window picked up all the scrap paper out there and are pretending it means something.If I send a dunning notice to the defunct company named and do not recieve an answer is this something that can be used to get it removed from record? No one has ever been bold enough to assign it to themselves.

    Anon., on August 7, 2010 at 9:46 am said:
    Note that I’m referring to the case where your property is devalued because you have no freaking clue who actually holds the liens on the property.

    Anon., on August 7, 2010 at 9:45 am said:
    To Court,

    This Is Not Legal Advice, but *yes*, this *does* apply. If you can afford it, you can probably file a lawsuit to “quiet title” in order to force them to demonstrate who owns the mortgage, in order to make it possible to sell the house.

    This gets the ball rolling and they have to show up with proof that they have an interest, and you’re into the whole Alice-in-Wonderland world previously described. If you’re really lucky, none of them will show and the entire debt will be expunged!

    Court Throckmorton, on May 11, 2010 at 7:26 pm said:
    Are properties that are not in foreclosure able to benefit from contesting the ownerr of the note?
    I have a property that has been severely devalued because of this mortgage manipulation the last ten years and I am unable to sell.
    I have all the documents, look forward to your response.

    colette mcdonald, on April 27, 2010 at 8:10 pm said:
    Jan van eck,
    Thanks for your thoughts I truly appreciate them.

    Jan van Eck, on April 27, 2010 at 7:27 pm said:
    to Collette McDonald:

    I would (very gently) suggest to you that you are missing a foundational element [so is the Judge, apparently]. You said that Bank of America is the “holder” of the Note, BUT that “Freddie Mac” is the “owner” of the mortgage. It does not work that way.

    Definition: the “Holder of the Note” has, in order to be a “holder,” to meet a two-pronged test. Prong One: the Holder has to have actual physical possession of the Note. the “real” one, the one you signed, not some photocopy. Prong Two: the Holder has to have the “authority to enforce” the Note.

    Now, “authority to enforce” indicates that the “holder” has the proper Indorsement to him, and a complete and continuous chain of title. If the Indorsements are incomplete (or broken, or with allonges that are imperfect) then he no longer has “authority to enforce.”

    In your case, the “authority to enforce” would be the right to file a lawsuit to collect the money value of the Note. BUT: you are not concerned with that, you are concerned with enforcement of the Note by way of “in rem” going against the property. To do that, the “Holder” has to also have a perfected, e.g. complete and unbroken, chain of title to the security instrument, the “mortgage.” (More likely, in your case a Deed of Trust).

    But see, that doesn’t work out, because the “mortgage” [or Deed of Trust} is being held by Feddie Mac. So the chain of title is screwed up. That implies that NOBODY can enforce the Note against the property. B of A can still enforce the Note by suing you personally for the money, but that is something altogether different from selling the property.

    I would take a copy of the Freddie Mac document you located with you to the “sale” and loudly announce to the “buyers” that the “mortgage” or “deed of trust” is actually held by Freddie Mac and any “buyer” that tries to buy from BofA is gong to end up with nothing. Nobody can stop you from making that loud announcement. And you can also announce that anybody who bids is buying themselves a huge lawsuit. Which they are.

    Then YOU can bid for the Note for six dollars, which should be interesting. Although I suspect that BofA will try to “bid” the value of the Note. Nonetheless, even BofA cannot take over the property if the last assignment of mortgage is to Freddie mac (and that assignment is properly recorded on the county land records. have you checked it out?).

    One final comment: the Judge assigned to your case does not understand what he is doing. Unfortunately, that is rather common these days. I would file a Complaint with the Judicial Grievance Committee, but hey that is just me.

    colette mcdonald, on April 27, 2010 at 11:04 am said:
    Mike, hi I recieved a packet from Freddie mac saying they were the owner of my mortgage. I went to freddie mac .com and enterd my info to see if they owned my mortgage and they did. So i printed it out and brought to the judge,
    BOA is the holder of the note, and service r of the account, not the holder in due course. The judge in Colrado did not care. Foreclosure was supposed to be April 2nd but I’ve managed to prevent that by sending letters of omissions and rescission . The new date is now April 30th. I’ll see what happens.

    Mike, on April 26, 2010 at 3:30 pm said:
    @ Collette

    Collette your first post said this:

    BOA produced a copy of the origional note endorsd by counrtywide ,WITHOUT recourse.

    Freddie mac is the owner of the mortgage not BOA /Countrywide who is the holder of the note.

    How do you know Freddy Mac owns the mortgage? Have the assignments been recorded?

    If this is the case, then once they have been separated you can’t put them back together. Bof A may own the note but the mortgage is no longer the security for the note.

    Did BofA claim they owned both the mortgage and the note?

    My understanding is they could try and collect the note and therefore you would need an audit to find out if they had been paid already through securitization, etc. or they would have to show how they came to have the note separate from the mortgage which was the security.

    You would then have the mortgage unenforceable and the note would be unsecured. BK could take care of note and file for quiet title.

    I am not giving legal advice and am actually asking questions for understanding

    Jan van Eck, on April 15, 2010 at 7:44 am said:
    to “Angel:”

    If you have “clear title” to your home then either you purchased it with no Note and loan or you took a loan and paid it off. If you paid it off then you “should” have received the original promissory Note with the Note stamped “paid” on it, AND a release of the security interest [the mortgage or deed of trust] on the land title records. Those are the foundational steps to clear title.

    What happened in your case? give us the details and we can help you formulate a strategy. And yes, some pro se do “win”, e.g. prevail, in Court. Not many, but some do.

    Angel, on April 14, 2010 at 7:58 pm said:
    Question: How many attorneys or Pro Se are winning their foreclosure battle?
    I have been in battle with Greentree for years now. I have clear title to my home but they “claim” to have bought it from another mortgage company and I should be paying them. They went so far as to submit forged copies of the note and the court accepted them and order me to pay into the court. I appealed the order. The mortgage company lacks jurisdiction because they have not produced the original note and they have put fraud upon the court. With all this and more, the courts keep ruling in their favor…. WHY??? The statues have been brought before the court – tons – and they are still waffling.

    Can someone please tell me what the heck has to be done to win when you are obviously right and in the right? Thanks

    Why “Produce the Note” is Not Enough | Foreclosure Industry, on April 2, 2010 at 11:36 am said:
    […] saw a post on Neil Garfield’s website a few weeks ago about the ‘Why Produce the Note Isn’t Enough.’ He hit the nail on the head when he said that it’s not enough to go into court and […]

    Marty, on March 14, 2010 at 1:37 pm said:
    It appears BOA is using the language “Foreclosure prevention” as a means to offer cash for keys in the manner of Deed in Lieu.

    Be wary of BOA deed in lieu offers that DO NOT waive the deficiency judgment.

    Be wary of accepting these BOA deed in lieu’s when you have an open 2nd mortgage also in default….this DIL will not cover the second.

    For those who are forced into a position(judgment issued against you) of having to leave the fight…. I would consider a Short Sale.

    A short sale is much better than a Deed in Lieu, as it changes the course of a borrower’s future credit score. Also, 2nd mortgages are also negotiated in the process, not leaving an outstanding balance.

    I am happy to discuss the ever evolving short sale process and of course the foreclosure fighting strategies that exist.

    Basically, you must make it VERY hard to foreclose, offer evidence, fabricate assignments and endorsements….this will buy you time. At the end of the day, either a Loan Mod or a Short Sale can be achieved and this is a better alternative than Foreclosure. Of course, complete debt extingishment and/or Damages for fraud are a best case scenario….however, it seems only those who don’t ask for such a measure get it.

    Good luck!

    ANONYMOUS, on March 13, 2010 at 7:15 am said:
    Jan van Eck

    Also want to thank you for getting involved here. Everything you say is right on the mark.

    I thought Countrywide (now BOA) was supposed to be offering significant loan modifications due to the multi-state Attorney General class action settlement.

    What goes on in courts is utterly amazing –

    usedkarguy, on March 12, 2010 at 10:32 pm said:
    Here’s a flash from Chicago: Sheriff Tom Dart has accused banks of seeking out friendlier courtrooms throughout the county to get evictions accelerated or passed through the court even though there are proceedings underway in another judges courtroom. Dart made the news in October of last year when he refused to perform evictions of tenants who had been paying their rent although the landlords had fallen into default. He also called for a moratorium on evictions.

    And Counselor van Eck, the legal system has become a circuit of Kangaroo Courts. No mouthpiece, no can hear. Period.

    usedkarguy, on March 12, 2010 at 10:14 pm said:
    Counselor Van Eck, thanks for getting involved here, sir.

    Jan van Eck, on March 12, 2010 at 8:23 pm said:
    to Collette McDonald:

    What kind of insanity in the courtroom is this? It is black-letter law that you cannot just go waltzing in with a “copy” of the Note and say that you have the original. You have to be the Holder of the Note to prevail, and Holder means you have to have “actual possession of the instrument” and have the “right to enforce the instrument.” So it is foundational law that the plaintiff has to produce the Note. Not a “copy,” the actual Note!!!

    A “letter from the County Teasurer saying she has seen something” is utter rubbish. That is pure hearsay, utterly inadmissable. You have to bring the treasurer in to testify as to what she saw or did not see.

    Even after that, just saying you thing you “saw something on file” is meaningless in real-property law. All matters of realty have to be reduced to writing. You have to have the documents available for presentment. I am holding my head in disbelief.

    Who signed the authority for the alleged transfer from CHL to BofA? If not an Officer of the Corporation (eg vice president), then were is the authentication of authority? Is that authentication “firmly attached” to the Certificate you mention? IS the authentication itself authenticated by notary? Man, this is riddled with defects.

    To avoid the Rooker-Feldman Doctrine stopping you cold in the Federal Court, File a Notice of Intent to Appeal in the State Court, then go file your case in the District Court. That State Court is beyond a joke. It might as well be in Uzbekistan. Unreal.

    tonybrown, on March 12, 2010 at 6:30 pm said:
    colette, That is very interesting… I hope someone in my case says that.. Am I missing something? they have seen the original but can’t produce it .. blue ink signature? In my request for productions you would not believe how many different copies of the note they have none of which are endorsed

    colette mcdonald, on March 12, 2010 at 6:16 pm said:
    Hi Jan, Colorado, Yes, agreed. off the wall.
    Her thinking is this. They had a copy of the original promissory note, deed of trust, a letter from the county treasurer dated and stamped saying she has seen the original on file. and a certificate showing countrywide transferring the name to BOA., state of Tx. dated April 09. She gave me one day to review the documents. I argued every point I could and she denied me. thanks for the tips. I will defintely pursue both avenues.

    GeoNOregon, on March 12, 2010 at 4:02 pm said:
    Does anyone have any feedback on US Lending Audit in Florida?

    They are the only auditors so far who have said they will look at more than just the closing documents. That’s what we must have.



    Jan van Eck, on March 12, 2010 at 12:10 pm said:
    to Colette McDonald:

    Wow, that is amazing. A witness who only found out about your case file “yesterday” is not credible. The Court should not have listened to any of it. What crazy State is this?

    File a Notice of Appeal, to defeat initialization of the Rooker-Feldman Doctrine. then immediately file suit in United States District Court alleging breaches of the Fair Debt Collections Practices Act (to get Federal Question jurisdiction) and aks for an ex-parte injunction.

    Your State Court Judge is off the wall.

    As another avenue, you can go into bankruptcy court, and file a Schedule listing your house with no debt other than a secured claim of $10 for the “lender.” They will have to file a Proof of Claim for more, and then you challenge the proof of Claim with an Objection. And then you file an Adversary Proceeding within the USBC (no filing fee) alleging damages from the state court testimony without proper foundation, and so forth. You can still prevail.

    colette mcdonald, on March 11, 2010 at 9:14 pm said:
    Hi, You might say it went well. It’s all good, is my attitude. I accomplished my goal of playing attorney for an hour an a half and giving them a run for their money. I objected to everything , cross examined the expert witness for BOA of the litigation dept. and made her look stupid cause she could not answer any of my questions. Except for the question I asked how long she had been familiar with my case. She said, since. Yesterday. That she knew the answer to. And I had a great closing argument. But none the less. the judge sided with boa and I lost and I guess they will set an auction date. But I do intend to continue to do what ever I can to mess with them. I have a fairly strong Bad faith claim I think.
    My question still remains?>>>Is freddie mac required to endorse the Certificate of filing or amendment ? That countrywide and BOA endorsed? Will they be commiting fraud if they go to auction with out the endorsement. ??

    Jan van Eck, on March 11, 2010 at 6:57 pm said:
    to Collette McDonald:

    How did your Hearing go?

    Remember, even if it went against you, it is not the end. There are still lots of avenues to attack the pretender lenders. The first one in the chain would be Standing, which if you prevail would void everything that happened in Court.

    Let us know how you made out.

    ANONYMOUS, on March 11, 2010 at 3:44 pm said:
    I think we were too late for Colette. Today is the 11th.

    ANONYMOUS, on March 11, 2010 at 3:42 pm said:
    Colette McDonald

    I do not know if anyone is responding to you. So I will give my best advise – and I am not a lawyer, this is for educational purposes only and not to be construed as legal advise.

    Tell the judge that you are not in default with BOA, Countrywide or Freddie Mac – because if you were in default with them they would have charged-off your loan and sold or “swapped” collection rights to a third party. Thus, your loan has been paid in full to BOA/Countrywide. Tell the judge that you have been denied the opportunity to negotiate a modification with the actual creditor because the actual creditor is not being identified. Tell the judge that some undisclosed party is profiting on your loan by purchasing it a steep discount and that this party is not identifying themselves. Tell the judge that BOA has been bundling delinquent loans with other delinquent loans for sale to third parties and ask the judge to have BOA demonstrate that they still account for your loan on their balance sheets – and if not, where did the collection rights go?? Tell the judge that if you were delinquent on any mortgage payments it is because you do not know where your money was going – and that if it was with BOA – they were OBLIGATED to at least consider a valid loan modification under TARP. Tell the judge that Countrywide, under a class action by Attorney Generals in multi-states was OBLIGATED to reasonably modify the terms of your mortgage. (see A recent settlement between the California Attorney Generals office, joined by 10 additional states, resulted in one of the widest reaching predatory lending settlements in US history.

    Under the landmark agreement, Countrywide Financial’s new owner, Bank of America, agreed to proceed with loan modifications on nearly $8 billion in home mortgages, potentially affecting hundreds of thousands of homeowners. )

    Tell the judge you will need to file for bankruptcy to avoid any “deficiency judgments” or any any other potential judgments by parties not named as a plaintiff, and therefore, during such bankruptcy you will request full discovery in order to determine that the discharge of any future “debt” obligation is complete and valid. Tell the judge you want an opportunity to obtain a valid appraisal of your home – and to compare that appraisal to the bank appraisal at loan origination. Tell the judge you want to pay what is due but to the right party and that, under current law, you deserve the right to negotiate directly with the actual creditor who now owns collection rights. Tell the judge if BOA/Countrywide sold the loan to Freddie Mac, then Freddie Mac – not BOA/Countrywide is your creditor. Tell the judge that Freddie Mac is supposed to be doing loan modifications. Tell the judge that Freddie Mac has likely disposed of your loan – which means BOA/Countrywide also have no rights to collateral in your home. Tell the judge that the note produced is only a copy and you need the original.

    Others here are much better then me at “copies” and note production. Someone please also give advise to Colette.

    Colette McDonald, on March 10, 2010 at 10:12 am said:
    The judge said I must prove tomorrow I am not in default with BOA. How must I go about that. Besides Object to everything.

    Colette McDonald, on March 10, 2010 at 9:53 am said:
    BOA produced a copy of the origional note endorsd by counrtywide ,WITHOUT recourse.
    Freddie mac is the owner of the mortgge not BOA /Countrywide who is the holder of the note.
    Question: Is Freddie Mac required to sign (endorse) the Certificate of Filing and The certificate of Ammendment as well, which is dated April 21 2009 . I have a hearing agin tomorrow at 9 am . Please reply
    Thanks so much,

    Gregory Bryl, on March 9, 2010 at 9:38 am said:
    Those in Northern Virginia with subrime loans or facing foreclosure are encouraged to contact attorney Gregory Bryl through bryllaw.com

    Abby in CA, on March 9, 2010 at 5:42 am said:
    I wholeheartedly agree with Anonymous. Competent lawyers in this area could reap huge rewards, not only monetarily, but personally and ethically from the satisfaction and understanding that they are helping consumers (homeowners) but also that they are participating in a fight to obtain truth and real justice.

    Neil’s classes are the fastest way to get the right knowledge pertaining to this foreclosure fiasco.

    tonybrown, on March 8, 2010 at 7:33 pm said:
    I can produce the note> the original , I’m in foreclosure
    after being served with said foreclosure the bank went and put an assignment at ROD…saying they held note and mortgage…. mers did the assignment from the original lender …. original lender does not exist… ( read my story posted under( semantics what a difference a word makes) here on livinglies… plus i never missed a payment, in order to protect my property

    Jan van Eck, on March 8, 2010 at 6:48 pm said:
    I ran into this quite recently in Federal Court where, for the first time since 2003, the pretender lender actually produced the original Note. Also on the witness stand was the Officer of the pretender lender, in this case DLJ Mortgage Capital, unit of Credit Suisse [the outfit that was denounced from the bench as an “international predator bank” by the Court in the case In Re Yellowstone Development Co., USBC Montana].

    On cross, the witness described the upper left corner of each page of the Note and the three pages of Allonges, all held with one staple. The Note had about a dozen staple holes in the pages. The various allonges had about 6 sets of staple holes in them. As you can imagine, none of this met the test of an allonge that it be “firmly affixed” to the Note! After all, it was taken apart and re-fastened a dozen times, and who knows what other papers were affixed, removed and destroyed?

    The witness Officer of DLJ then testified that the last Allonge was in turn stamped and signed off “in blank” but was done by him that morning in the attorney’s office just before the hearing at 10:00 a.m. Oops. The Pleading signed by counsel several weeks earlier claimed that the Note was Indorsed in blank. Except that, at the time the Pleading was prepared, it wasn’t.

    Then buried inside the chain of fraudulent allonges was one signed by a “Document Control Officer” of the “purchaser,” acting as “attorney in fact” for the lender, except that his power of attorney was not attached, and was nowhere to be found. So much for authority to sell.

    Testimony went as follows: “You purchased the Note?” “Yup.” “Well, what did you pay for it?” “Objection!!!” and you get the stiff resistance of the attorneys to the question of “how much.” Reason: because they paid nothing at all; it was part of a transfer of assets to get them off the books of the previous pretender lender [GRP Loan LLC} which was folded up as the cops came sniffing around.

    Then the witness testified that he signed off on the Note in blank so that it could just be filled in by the next speculative pretender lender, in case they were not successful in their blitz on the Court. And there you have it, folks: fraud on a grand scale, by shylocks from New York City.

    Of course, none of the purported allonges restated the original loan number, or any other indicia that would tie them to the Note. Also, the Note itself had a ton of blank space on the last page and the back of the last page was entirely blank – and under the NY version of the Uniform Commercial Code [UCC Sec 302(2)] they have to use that up under the No-Space Test before going on to the first Allonge. And while none of the blank space on each successive Allonge was used up, the various pretender lenders just merrily continued to manufacture further add-on pages. At Oral Argument, I represented that since the two States that use the 1951 version of the UCC – NY and NC – lean on the No-Space Test, the allonges were invalid on those grounds alone. Lawyers for the pretender lender kicked up a huge fuss, stating that notwithstanding that the allonges were all manufactured in NYC, since they were “Delaware Corporations” the NY Rule did not apply. Oops: under Section 25 of the Agreement of Purchase and Sale, obtained from the SEC 8-K Filing, the jurisdiction of all matters related to the Agreement was: you bet, New York!

    So: move to strike the claim, or if you are in USBC, move for a subordinate status of claim under Sec 510(c). Then be sure to sue them all.

    Pantera, on March 8, 2010 at 4:46 pm said:

    I need a forensic analyst for a position with our firm. Can you recommend one? We are in CA.


    ANONYMOUS, on March 8, 2010 at 4:35 pm said:
    I highly urge lawyers to attend the workshops. Problem here, that I see, is that attorneys are not yet grasping the financial benefit of representing individual home owners. Not only can attorneys benefit financially from multiple consumer actions, but also an astute attorney could develop class actions that could reap huge profits for the law firm.

    Many law firms have lost their best corporate clients and ability to earn attorney fees as the crisis has unfolded. It is time to redirect energy into consumer issues. This is the future where the largest awards could be reaped. Time to shift direction – corporate representation in foreclosures will die – sooner or later. The people always prevail – sooner or later.

    Fighting Hard, on March 8, 2010 at 3:42 pm said:
    Question on assignment of the Mortgage in FLorida.

    Sued for foreclsure in Nov 2009 by US bank XYX trust 2005. THEN the plaintiff filed the assignment of the mortgage transfer Feb. 2010. I thought you had to show the asingment when it happen, which this 2010 doc shows the mortgage was assigned in 2005, but not the NOTE.

    Any links, or info on Florida law on assignment of the mortgage?

    Pavel, on March 8, 2010 at 11:36 am said:
    will be the workshop materials available in the video and written format?
    thank you.

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  39. Below, please find the Ohio Revised Code (147) which refers to a notary record, or journal. As you can see, these are only required in cases of certificate of protests or copy of notes, which are seldom used in Ohio. Notaries are not required to keep a record of other notarizations which they perform. We do, however, recommend that they do keep a journal, and many notaries do just that.

    If you wish to subpoena the journal, I would assume you should contact the notary directly, or the county recorder if the notary has surrendered it to them.

    Please feel free to contact me if you have any further questions

    ORC 147.04
    A notary public shall also provide himself with an official register in which shall be recorded a copy of every certificate of protest and copy of note, which seal and record shall be exempt from execution. Upon the death, expiration of term without reappointment, or removal from office of any notary public, his official register shall be deposited in the office of the county recorder of the county in which he resides.

    Kathy Spinelli
    Ohio Notary Commission

    This is what the reply is from the State of Ohio fpr Notaries. This is amazing. No log required. That is why Chase likes Ohio. I pity those who live there.

  40. […] Livinglies’s Weblog Filed Under: Foreclosure Law News, Foreclosure News Tagged With: crisis, foreclosure, […]

  41. @ johngault

    “As a bk decision, it’s not binding precedent,”

    It’s too bad that most of the challenge to lenders (servicers) has only been done in bankruptcy courts. Hope that will change. Attorneys don’t even want to represent homeowners who are not in bankruptcy. There is recent precedent of judges citing the bankrupcty cases though – Supreme Court of Nevada in Leyva and Pasillas both important decisions cited to Veal AZ 9th Circuit(bankruptcy) another important decision.

  42. Indio,

    Contract 101: “No meeting of the minds, hence no enforceable contract” was tried a few times between 2008 and 2010 in several states and failed… because the timing was all wrong and no one understood the monster that banks had created in MERS and its long lasting and overreaching ramifications. Judges ruled in favor of banks on face value (a mortgage contract entered into willingly by the borrower), unaware of the extent of the fraud perpetrated on said borrower and on America. Judges could not, for one minute, imagine the extent of the scheme.

    If you do some research, you’ll see that more judges have recently agreed that, when MERS is involved in any mortgage transaction, there is no meetings of the mind and the contract is void. The reason for the delay is that judges didn’t understand what had been going on and rigidly followed the law, oblivious to the fact that that same law had been trunked up years ago. I honestly believe that judges could not fathom the nerve required to pull that kind of stunt. Defense attorneys, likewise, were completely oblivious to the devious nature of the beast and argued the wrong issues.

    Had more homeowners fought earlier, we would have seen a reversal of that trend earlier as well. Nothing is lost, though: more people are fighting. More judges come to see the light. Banks are at each other’s throat. It will get better. Now, it is up to people victimized by banks to act, even if it is after the fact and after they lost their house.

  43. indio – interesting observation.
    Don’t overlook this Mann ruling. As a bk decision, it’s not binding precedent, but it has more than one valuable decision (and a couple with which I don’t agree) for argument by others. Unlike other CA courts, Judge Mann finds strict construction (compliance) with CA foreclosure statutes must be observed. And unlike me, she finds no fiduciary on the part of the dot trustee , referrring to the trustee as a dual agent of the borrower and the beneficiary (which seems an oxymoron since an agent has a fiduciary). While I don’t agree, this dual agency is not altogether worthless to the borrower. You might want to read this one at stopforeclosurefraud.com and take notes, especially if you have already lost your home in CA or maybe anywhere and there was no recordation of an assignment of your dot prior to the foreclosure.

  44. The Topic of Abandonment is discussed in the BAP appeal Davies v. Trustee Zimmerman 9th Circuit.
    This is the Second BAP Appeal. This deals with formal abandonment of Property by order under 11 U.S.C 544. Trustee motioned to reach back into a previously sold judgment and sell for 1/10 of 1% of the value and while the title was held by the collection agency.


  45. Why am I not hearing about this in the news? After following for a while I feel like I am failing to take action or I will miss a cut off date of some kind. Does anyone else feel the same? Is the bank going to one day mail me the cleared up paperwork? Clarity seems to be in short supply.

  46. Margaret Mann is doing a nice job on the law.

    FDIC Looking at Brokers in Failures of Big Thrifts

    Share |

    Tuesday, August 23, 2011
    By Brian Collins

    As the FDIC continues to investigate the failures of banks like IndyMac and WaMu mortgage brokers are coming under more scrutiny for the loans they originated for those wholesalers.

    Like what you see? Click here to sign up for a National Mortgage News free trial and daily newsletter to get the latest feature stories, news headlines, data, and in-depth analysis on the issues impacting the mortgage industry.

    The Federal Deposit Insurance Corp. is focused on brokers that delivered loans to the banks that resulted in heavy losses such as stated-income and no-documentation loans where the incomes of many borrowers were inflated.

    The mortgage brokers feel this is unfair because they were making these “liar” loans at the direction of banks.

    In many cases, the banks didn’t want the brokers to verify borrower income or check tax returns.

    Mortgage broker Marc Savitt noted the loans are generally four or five years old and it was the bank’s responsibility to check borrower income.

    If the FDIC contacts a broker, “my advice is don’t give them anything until you talk with a lawyer,” Savitt said.

    Savitt is president of the National Association of Independent Housing Professionals, which has retained a California law firm to advise its members.

    The NAIHP president recently met with FDIC attorneys about the lawsuits.

    “They are only pursuing cases that are cost effective,” Savitt said.

    The cases mostly involve active brokers with financial resources or error and omission insurance.

    First, the FDIC sends the broker a notice and step two is a subpoena for financial information.

    “They want a settlement. This is all about the money,” Savitt said in an interview.

    The FDIC is not targeting brokers or any other group, according to FDIC deputy general counsel Rick Osterman.

    “We are reviewing bank failures to determine whether people were responsible and culpable for the failure. Where we have meritorious and cost-effective claims we have an obligation to bring those claims,” he said.

    The FDIC currently has 172 pending mortgage malpractice and fraud lawsuits against mortgage brokers, appraisers, attorneys, closing agents and title companies.

    After notifying individuals that they might be sued, FDIC attorneys “generally talk with them upfront to tell them what we found and hear their explanation,” Osterman said. “It is possible we don’t have all the facts. We are open to discussing that and getting all the information before making a decision to go forward.”

    One source with knowledge of four FDIC settlements with brokers said they ranged from $10,000 to $15,000. But the FDIC attorney indicated there are larger settlements with brokers.

    Most of the broker lawsuits involve Bank United, IndyMac Bank, AmTrust, Washington Mutual and a handful of other banks that were major wholesale lenders before being closed by regulators and the bad assets were handed over to FDIC.

    Wholesaler lenders require brokers to sign contracts with indemnification clauses, according to attorney Herman Thordsen, who represents several brokers facing FDIC lawsuits.

    These indemnification clauses essentially say if anything goes wrong with the loan, for any reason whatsoever, the broker must cover any losses incurred by the wholesaler.

    So the mortgage broker is really on the hook if the loan goes bad, according to Thordsen.

    But he noted that the contracts used by the failed Pasadena, Calif., IndyMac Bank refer to brokers who “sell” loans.

    However, brokers can’t sell loans because they don’t fund loans.

    “We have always taken the position that the contract is not valid. And it cannot be enforced against the broker because they never sold them a loan,” Thordsen said in an interview. His law firm is based in Santa Ana, Calif.

    Meanwhile, some brokers claim that the lenders could have protected themselves from borrowers who inflated their incomes on stated-income loans by pulling their tax returns.

    They point out that lenders didn’t want the brokers to verify the borrower’s income.

    In fact, lenders instructed brokers to send them the IRS 4506 forms that are signed by the borrowers but not dated.

    The IRS requires the taxpayer/borrower to sign and date the form.

    Once dated, the lender must send the form to the IRS within 120 days to gain access to the borrower’s tax filings. After 120 days, the IRS will reject the request.

    If the form isn’t dated, lenders can exercise that right anytime they want by inserting the date. This is why in Thordsen’s opinion lenders requested an undated form.

    So instead of using the 4506 to verify the borrower’s income during the origination process, some lenders wait to pull the borrower’s tax records after the loan goes bad.

    “They use the 4506 to prove its bad and go after the broker,” Thordsen said.

    “There is no penalty for not dating the IRS form. So there is no downside for violating the law.

  47. “What is important is that the Court did uphold that MERS could execute the Substitution of Trustee legitimately, through agency or power of attorney authority.”


    Viable 17200 claim. MERS is not off the hook on this one. MERS remains a party to the 8th and 10th causes of action and I hope your precious MERS gets their asses handed to them on a plate.

  48. Niel , Have you or anyone else thought of preemptively getting any MERS DoT annulled based on the fact the borrower bargained to ultimately have a clear title at the end of payments?

    Once a mortgage goes into the MERS system there can be no clear title derived from them. They keep no record of the chain of conveyances. They have no proof of agency.
    Now I know some courts have been using the borrowers consent to sign the DoT as a bar to contest MERS but that doesn’t mean a clear title can be derived

    Thus the “borrower” signed the DoT based on a false inducement.
    A Scire Facie can be used to annul a DoT that was the createdas result of false inducements.

    Why is no one being proactive????

  49. This shows a clear violation of 2932.5, which requires an Assignment prior to the actual Trustee Sale. Courts have ruled on this often. I would have pointed that out to any attorney the flaw in the Assignment.

    What is important is that the Court did uphold that MERS could execute the Substitution of Trustee legitimately, through agency or power of attorney authority. I would also have pointed out to any attorney that documents held by lenders would show the agency/power of attorney relationship. Notice that to arrive at this decision, they essentially followed UCC Code regarding transfer of the Note.

  50. Bravo, Judge Margeret Mann. Thank you for doing your job and applying the rule of law. That is ALL we homeowners ask. Apply the rule of law as it is meant to be applied – not biased in favor of the banks.

    What is WRONG with this country that a judge should be considered a hero/heroine for doing what he/she is supposed to do?

    Never mind, just a silly question. I already know the answer – our corrupt corporate-owned society.

  51. In California, any homeowner that challenges a bank, the banks love to cite Gomes, Ferguson, etc. The banks feel that ANY challenge in California falls into the previously mentioned cases category. This judge in CA, follows the rule of law and distinguishes the B.S. the banks throw in her courtroom. Well done Judge Mann.

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