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EDITOR’S COMMENT: Here is the game:

A party comes into court filing a complaint against someone who is essentially unable to defend themselves. The suit is fake and uses fraudulent documents to support it. In the usual course of events the “defendant” defaults, judgment is entered and the faker gets to enforce the judgment, driving the hapless defenseless person who was sued into bankruptcy and depression, marriage breakups etc. You know the routine.

(By the way the North Caroline Court has stated that just because you failed to object doesn’t mean that the party trying to foreclose doesn’t need to prove its case, which is why I think the last couple of days have been the turning point where borrowers get their day in court and pretender lenders get their days or years in jail).

So back to our example. Enter the borrower, usually not represented by counsel because the legal profession is clueless for the most part on the dynamics of fraud in securitized loans. The borrower challenges the attempt at foreclosure (or any other type of lawsuit where this playbook can be used). The borrower shows the court that the suit is a fake and that the documents were fabricated, forged, false — a fraud upon the court. The trial court dismisses the fake action and agrees to hear a motion for contempt at which the faker will be punished for all its wrongdoing, right?

Not so fast. The Bank Playbook provides easy to understand instructions to lawyers representing the fakers. Force the issue as far as you can but dismiss the action before the motion for contempt can be heard. This will deprive the court of jurisdiction over the case and the Judge will be powerless to enter an order for sanctions. End of case, for now, and maybe we will file using other but better fabricated false documents another day. No risk to the lawyer, the Bank or servicer, or anyone else, leaving the hapless homeowner in the dust. This play has been working perfectly for years. Suddenly it ground to a halt yesterday in Florida, and will most likely spread the word like wildfire as Courts across the country realize they have been played for fools.

So the borrower in this case said “wait a minute!” The borrower/defendant filed an appeal that essentially said that the filing of a false lawsuit with false documents invokes the jurisdiction of the Court and that the Court decides when the case is over, not the litigants, if there are any other important issues to be decided — like committing fraud upon the Court.The borrower contends that the filing of the dismissal did not deprive the Court of jurisdiction, it merely rendered the legal issues presented by the lawsuit to be moot, which is the point that the Florida Supreme Court agreed with.

So the case goes up to the District Court of Appeal which says, well, we don’t know for sure, so we certify the question to the Supreme Court. The faker “settles” with (read that “Pays off”) the borrower under some agreement that is sealed under confidentiality. There are thousands of those confidential agreements now.

So the faker and the borrower sign the agreement and sign a notice to the Supreme Court that the case has been settled and that it is over, done, kaput! In the playbook of the Banks this deprives the Supreme Court of jurisdiction even in a case designated by the lower appellate court as being of great public importance and in which the appellate court below cites their own experience with many cases involving fake claims with fraudulent documents. Not so fast.

The Supreme Court of Florida said quite correctly that WE decide when the case is over, especially when it is of great public importance, and you, faker, don’t  dictate to us when we do or don’t have jurisdiction. If you filed a fake lawsuit with fraudulent documents, we want to consider the options of the trial judge and stop such practices from happening. The fact that the case is moot between you and the the victim of your little game does not mean we can’t hear the case. You can come to oral argument if you like, and you can submit a brief or not. But we ARE going to hear this case and we are going to issue an opinion. FINALLY A COURT WITH THE COURAGE OF ITS CONVICTIONS.

OOPS! BONY, US BANK, BOA, Wells Fargo, Ocwen, Deutsch, Countrywide, JP Morgan, et al now have a serious problem. In prior cases where a court levied sanctions against these fakers, the sanctions have been rather high, including one case in Massachusetts where an infuriated judge levied over $800,000 against the lawyers and the client, Wells Fargo.6 million foreclosures nationwide, most of which fall into the faker category.

What could the liability of the lawyers and the banks be? Well just for starters, you can bet that most of the lawyers are going to be referred to their bar associations for discipline which will result in either suspension or revocation of their license. But beside that here is what awaits the financial industry on 6 million foreclosures.

  • If the fine is $1,000, the total fines will be $6 Billion. But sorry boys, that size fine is less than a slap on the wrist these days so its doubtful that the judge upon learning that a fake suit had been filed with fraudulent documents will not fine the participants — lawyer and client—  far more than that. 
  • If the fine is $10,000, then the total fines will be $60 billion. Sorry again, considering the gravity of the situation, the corruption of title registries, the destructive impact on our society as a whole, most courts are going to go for more than that as well as referring for criminal prosecution and bar grievance procedure. 
  • If the fine is $100,000 each against the lawyers and the client, for each case, which is around what I think the fine is likely to be (at a Minimum), then the total exposure is $1.2 trillion, half against the banks and half against the lawyers.
  • And if they follow the model established in other courts, the fine could be $1 million each against the lawyers and the client, FOR EACH CASE, (if the motion for contempt is brought by the borrower) then the total exposure is around $12 trillion, $6 trillion against the banks and $6 trillion against the lawyers. Considering the most recent revelation of $29 trillion bailouts from the federal Reserve alone on false claims of losses, a fine of one-third that amount doesn’t seem out of line even if the dollar amount sounds high. Bankruptcy anyone?


Settlement won’t prevent Fla. foreclosure hearing


Associated Press

TALLAHASSEE, Fla. — Parties in a Florida mortgage foreclosure lawsuit focusing on allegations of tainted documents will get their day in the Florida Supreme Court even though neither side wants it.

A sharply divided high court on Thursday refused a request by borrower and lender alike to dismiss the Palm Beach County case. They had sought the dismissal after agreeing to settle the case before the justices could hear it.

In a 4-3 opinion, the majority justices wrote that the borrower’s appeal was too important to dismiss, as it raises a question that “transcends the individual parties to this action because it has the potential to impact the mortgage foreclosure crisis throughout this state.”

That question is whether a trial judge can penalize a party for committing a “fraud on the court” if that party voluntarily dismisses the case before it’s resolved. Two lower courts said they cannot. The high court next will consider arguments on that issue.

The majority wrote that judges and litigants also need guidance from the Supreme Court and that the legal issue has implications beyond mortgage cases.

Florida’s collapsing real estate market has resulted in thousands of foreclosures, but officials have turned up many instances of fraudulent and erroneous filings.

They include documents bearing the signatures of so-called “robo-signers” – people hired to sign foreclosure papers in assembly line fashion without necessarily knowing what’s in them.

Those findings resulted in civil and criminal investigations, the collapse of two major foreclosure law firms and the temporary shutdown of foreclosure filings by many lenders.

The high court’s ruling came in a foreclosure filed by the Bank of New York Mellon. The defendant, Roman Pino, alleged the bank filed a forged document to deceive the court. He asked the judge to penalize the bank by denying it any right to foreclose on the mortgage.

The judge denied his request because the bank had voluntarily dismissed the complaint. The 4th District Court of Appeal affirmed that decision but asked the Supreme Court to rule on the issue, certifying it as a “question of great public importance.”

Pino appealed but then joined the bank in asking the Supreme Court to dismiss the case after they settled.

Chief Justice Charles Canady acknowledged in his dissent that the high court has on occasion rejected a stipulation for dismissal, but he argued that retaining jurisdiction before both sides have submitted written briefs is unprecedented.

The ruling will force the parties to argue a case that neither side wants to pursue, Canady noted.

“They should not be dragooned into litigating a matter that is no longer in controversy between them simply because this court determines that an issue needs to be decided,” Canady wrote.

Justices Ricky Polston and Peggy Quince concurred with Canady’s dissent.

The majority justices, though, wrote it’s Canady’s interpretation that goes against precedent. They said it would require the high court to recede from past decisions that denied dismissals in similar circumstances.

They also noted Pino filed an initial brief before the settlement although the bank had not.
Read more: http://www.miamiherald.com/2011/12/08/2537386/settlement-wont-prevent-fla-foreclosure.html#ixzz1g3eoiucH

15 Responses

  1. Valuable info. Lucky me I found your web site unintentionally, and I’m shocked why this accident did not came about in advance! I bookmarked it.

  2. Hi Mr. Garfield,

    Will you post what North Carolina case you’re referring to? Thanks

  3. What case is Mr. Garfield refering to here?

    “By the way the North Caroline Court has stated that just because you failed to object doesn’t mean that the party trying to foreclose doesn’t need to prove its case…”

  4. Massachusetts already has fines and felonies in the law for anyone filing fraudulent docs into the Registry of Deeds, and then of course most of those were filed into the court as well. Lets see who is going to get fined next. I bet it is coming.

    $500, 000 to $100,000 plus jail time.

    Hey HARMON LAW OFFICES, maybe you and Mr. Stern can share some quality time together 🙂 The AG is gonna get cha too !

    The people are winning, shout it from the roof tops!!!!!!!!!!! Massachusetts is going to be getting some good chunks of change and I think MERS will be a major contributor. OK I will be nice (chuckle)

  5. This is just plain beautiful……………….and I respect that Judge and I am loving this but don’t think this isn’t just a very quick way to get those judges pensions up again 🙂

    I for one plan on taking my case all the way…………..no settlements for this Yankee!!!!!!!!!!!!!!!!!

  6. hi all everyone is so involved in the robosigning scandal they have forgotten about all the other frauds. wells fargo put ne an N for 25 years in a “stated income loan” i was working at this one hospital for 6 years. verification of implpyment is important for checks and balance. what they did was allow unscrupulous mortgage broker pull the wool over the eyes of floridaians. making it seem as though we were approved for these homes. the mortgage broker for wells fargo raised my montmy income a mere 700$ just enough to where i was underwater from origination from closing. where can this be legal. i was an out of town buyer i never filled in the mortgage application only intitialed it at closing. but what realy freaks me out is my husband who was unemployed is on the mortgage but not on note. how can this be legal. he was unemployed. wells fargo took vover our town help us god get out of this mess

  7. Yup—no “lender”…no funding…just like ANONYMOUS has been saying…

  8. Anyone discover that the title agency took the premium at settlement and NEVER funded the lender policy? I think I may have discovered that. Agent is in Florida and insurer is Stewarty Guarranty (owned 22% FYI by Wells Fargo my servicer). No one responds ofcourse. Seems hard to transfer the loan via the PSA without title insurance. I guess they stole a $1500 premium from me off HUD settlement for the premium. Stewart so far says go pound sand bec it is lender policy. We will see. Wells Fargo answers nothing.

  9. I believe there is a satifaction of the mortgage recorded recently with Pino. Was the lien removed and house paid off? I saw the satisfaction recording on another website. Are we guessing that the bank released the loan to settle the deal?

  10. […] reading this article by Neil F. Garfield, Esq. (http://livinglies.wordpress.com/2011/12/09/florida-supreme-court-rips-up-banks-playbook/), I have an open question for lawyers and judges that I am pondering.  How can any […]

  11. This is more of the type of news we want to hear about our courts and righteous judges who are in there for what they pledge to do. God as Supreme Judge will give these judges wisdom, if they ask Him to make right decisions. He warns that He will punish anyone who removes the boundary of another person’s property. We must not forget the case with the man in the Bible who coveted his neighbours property and eventually destroyed him to acquire his property!!!And what King David did to him!!!

    Anyway, I applaud any judge who has the courage to abide by the sacred constitution that allows him the right to be there as part of the state government of we the people that is to have the security of knowing that that Judge will deliver justice no matter what.

    The numbers in $ are indeed staggering to those of us that are use to such a trickling of a small piece of the pie. Our tax dollars need to be repaid with inters and the banksters need to shut down, clear the land as they are now despots, and we need to allow new and honest others to create new and trust worth financial institutions and also to get rid of the dishonest attorneys who abused their profession for their own gains and allow others to enter the profession that will safe guard the integrity of the Bar. Right now that is a difficult and challenging request. Your thoughts.

  12. Great News coming out of Florida. Bondi needs to get a real job, if she can find one.

  13. Great News Neil. So now what inning are we in? And what is the score now? Let me know, please.

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