Bloomberg: Whistleblower at Citi Sets the Standard for Attacking Mortgages


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Editor’s comment: The article below summarizes the bad loan analysis: “finding flaws in new loans that included altered tax forms, straw buyers and borrowers who listed fictitious employers.” What’s missing? — flaws in loans that included altered or fraudulent appraisals, altered or fraudulent disclosures under TILA, altered or fraudulent settlement statements, straw lenders, and mortgage brokers who listed fictitious creditors and underwriters. 

The media and law enforcement still refuse to take the extra step — simply looking at the origination of each loan and determining whether the same standards they are using to disqualify the underwriting of the loans should be used to invalidate the enforceability of the loans.

I know this is a hot button, but I remind you that it is our position here that IF there is a balance due on the obligation, the homeowner still owes it — but that the amount of the claim is being falsely reported and the identity of the creditor is being fraudulently presented.

Most importantly, the collateral for the obligation — the home — has never attached to the loan, particularly as to “strangers to the transaction” who were neither parties to the borrower’s transaction nor parties to the lender’s transaction.

Strategically the path of least resistance is to start by attacking the mortgage and not the the obligation. Tactically, the and realistically, the entire obligation, if it is documented at all, is contained in BOTH the closing documents with the investors lenders (the securitization documents) and the closing documents with the borrower (the escrow closing with the homeowner). Even then, since the two sets of documents don’t refer to each other, and the two sets of people — lenders and borrowers — are not identified properly in either set of documents, some equitable reformation of the entire transaction must be used, which means there can’t be any summary judgment or non-judicial foreclosure.

And unless the actual creditor shows up in the courtroom with proof of a claim of loss, there is no action, period. Strangers tot he transactions are not permitted to enter into a court proceeding claiming a debt owed to another person merely because they learned of the debt. They must possess their own claim and they can recover only up the amount of their own claim, if they prevail. AND they are not parties to the security instrument (mortgage or deed of trust) so they are not secured.

The current pilot program of naming the pool is a strategic rope-a-dope. In more than 50% of the cases, the pool does not exist anymore having been resolved (settled) or succeeded by another pool with different terms. In short they have been paid.

In 95% of the cases, the loan never made it into the pool nor could it have been accepted by the manager or trustee because the loan was

  • (a) non performing at the time of the “assignment”
  • (b) not supported by an actual monetary transaction in which the loan was sold and
  • (c) was imperfectly “assigned” by unauthorized clerks acting as officers using methods not approved by the PSA AFTER the cutoff date (meaning that even if they were right about assigning the loan late into the pool and even if the pool “accepted” the assignment despite the prohibition against doing so, the principal and material representation to investors regarding tax treatment by the Internal Revenue Code (activity is considered nontaxable event) would be breached.

In the end I return to my basic question: if the original loans were valid, if the loan documents did not contain false declarations of fact, then why would any of the banks have ever needed to resort to fabrication, forgery and fraud? We keep hearing the latest mantra that renting the properties is the way out of the foreclosure mess. No, that isn’t true. All the title problem and monetary losses suffered by victims of fraud would remain under that scenario.

LAWYERS GET THIS POINT!: The fact that an assignment document has been presented does not mean the assignment occurred. Each one says “for value received.” Attack that through discovery and you will find that in no case was any money paid for the sale, transfer or assignment of any loan because the original transaction already took place between the lender investors and the borrower homeowner. There was nothing to pay and nothing to receive because the obligation was already owned legally and equitably by the investors at the time of the alleged sale, transfer or assignment. And the fact that an assignment is offered does not mean that it has been or could be accepted. Discovery directed at the assignee will clear that up in 30 seconds.

The real way out of the foreclosure mess is (a) reverse the wrongful foreclosures (even if you want to narrow them down to those in which the borrower actually owes money and can’t pay it) and (b) stopping any future foreclosures by strangers to the transactions that are based upon false declarations in fabricated documents identifying the wrong parties, and omitting key elements of the terms of repayment.

It is simple. Give back what was stolen in money, property, and reputation (credit scores etc.) and the whole country will have its middle class restored with money to spend in our consumer driven economy.

Citigroup Whistle-Blower Says Bank’s ‘Brute Force’ Hid Bad Loans From U.S.

By Bob Ivry, Donal Griffin and Andrew Harris

Four years after rotten mortgages helped trigger a global financial crisis, Sherry Hunt said her Citigroup Inc. quality-control team was still finding flaws in new loans that included altered tax forms, straw buyers and borrowers who listed fictitious employers.

Instead of reporting the defects to the Federal Housing Administration, the bank saddled the agency with losses by falsely declaring the loans fit for its federal insurance program, according to a complaint filed yesterday by the U.S. Attorney’s Office in Manhattan. Citigroup agreed to pay $158.3 million to settle the claims, and admitted that it certified loans for FHA backing that didn’t qualify.

Hunt, who filed a sealed lawsuit against New York-based Citigroup in August that the government joined, will collect $31 million of that sum — before taxes and attorney’s fees — as a whistle-blower, she said in an interview yesterday. The settlement, which encompassed misconduct spanning 2004 to the present, indicates Citigroup has lingering problems in its O’Fallon, Missouri-based CitiMortgage unit.

“Citigroup in particular received government funding, taxpayer dollars, because of its risky operations,” said Peter Henning, a law professor at Wayne State University in Detroit. “It shows that they hadn’t really learned much of a lesson from the financial crisis.”

Inspector General

The inspector general for the U.S. Department of Housing and Urban Development faulted Citigroup’s quality-control program during a 2008 audit, according to the complaint. Taxpayers rescued the bank with a $45 billion bailout that same year and guaranteed more than $300 billion of its risky assets after the lender’s stability was threatened by mounting costs on soured loans. The bank lost a total of $29.3 billion in 2008 and 2009.

Hunt’s co-workers, instead of checking for fraud or making reports about underwriting defects to the FHA as required, argued with her over the soundness of the loans, she said. Employees who acted as “gatekeepers” applied “what they describe as ‘brute force’ to pressure Citi’s quality control managers” into downplaying defects, according to the government’s complaint.

Some colleagues had pay incentives tied to reducing the number of reported problems, and they spent hours trying to get her to relax her warnings, including those about the most basic deficiencies, Hunt said.

‘Beating Us Up’

“They started beating us up over the quality-control reports,” she said.

Last year, she said, she became convinced she was being asked to look the other way on serious flaws. That’s when she decided to become a whistle-blower.

“All a dishonest person had to do was change the reports to make things look better than they were,” Hunt said in an interview. “I wouldn’t play along.”

Citigroup has approved about 30,000 loans with a value of $4.8 billion for FHA insurance since 2004; more than 30 percent of those borrowers have quit paying, the Justice Department said in its complaint. Almost half the bank’s FHA loans originated in 2006 and 2007 have defaulted, the government said, with HUD paying out almost $200 million in insurance claims on mortgages Citigroup originated or underwrote since 2004.


52 Responses

  1. Does anyone recognize the name Yanganzia Daniels, an alleged VP of Impac Funding in Texas? The foreclosure mill law firm of Phelan, Hannigan et al in Philly PA just recorded an assignment from Impac (the originator) directly to the trust on 2/2/12 using this person. The closing date on the trust was August 29, 2003!

  2. CA Laws Regarding Attorney Solicitations and Link for other states—-

  3. @Ian and @ Chris

    @Ian–BOA was not the ONLY Warehouse Lender for New Century.
    Even the Swiss Bank UBS was one of their warehouse lenders and there are many others.

    you must be careful, the Judge in the New Century bankruptcy case did issue orders for them to proceed with ‘business as usual’, as he puts it….and you betcha he was in charge along with the bkr trustee in ‘selling’ ‘transferring’ loans/properties (the assets). There were also multiple POAs filed and some were executed by the ‘newish’ appointed CEO Holly Etlin.

    In the second scribD below, you will see a limited POA signed by Holly Etlin.


    SEE__Business As Usual—this describes the hiring of Holly Etlin in June of 2007, after New Century declared bankruptcy
    June 12, 2007 4:42 PM EDT

    In Today’s 8-K Filing From New Century Financial (OTC: NEWCQ): As previously announced, New Century Financial Corporation entered into an asset purchase agreement, dated as of May 2, 2007, with Ellington Capital Management Group, L.L.C. on behalf of its client funds, pursuant to which Ellington agreed to purchase certain mortgage loans originated by the Company, as well as residual interests owned by the Company in certain securitization trusts for approximately $58.0 million.

    On June 8, 2007, the Company terminated the employment of Brad A. Morrice, who was serving as the Company’s President and Chief Executive Officer, without cause pursuant to Section 5.1 of that certain amended and restated employment agreement, dated March 29, 2006, between the Company and Mr. Morrice. Mr. Morrice has also tendered his resignation from the Company’s board of directors, effective immediately.

    On June 8, 2007, the Company terminated the employment of Anthony T. Meola, who was serving as the Company’s Executive Vice President, Loan Production, without cause pursuant to Section 4.2 of that certain employment agreement, dated May 1, 2006, between the Company and Mr. Meola.

    On June 8, 2007, the Company’s board of directors appointed Holly Etlin, the Company’s Chief Restructuring Officer, as President and Chief Executive Officer and Michael Tinsley, the Company’s controller, as Chief Financial Officer.


    Bankruptcy Trustee Opposes New Century’s Sale of Mortgages
    Published: April 10, 2007
    New Century Financial, a subprime lender that has filed for bankruptcy protection, should not be allowed to sell $50 million worth of mortgages to a subsidiary of the Royal Bank of Scotland, a United States trustee said yesterday in court papers.
    Before the sale is approved, New Century should be forced to eliminate or reduce a $1 million breakup fee associated with the deal and to say how it will protect consumer financial data, the trustee, Joseph J. McMahon Jr. (THE FIRST TRUSTEE), said in court papers filed in Federal Bankruptcy Court in Wilmington, Del.
    The breakup fee, which New Century would pay to the Royal Bank of Scotland if the sale was not completed, is nothing more than a “$1 million windfall” for Royal Bank, Mr. McMahon said in the filing. Federal trustees monitor bankruptcies on behalf of the Justice Department.
    New Century, based in Irvine, Calif., specialized in making loans to home buyers with poor credit before it filed for bankruptcy protection on April 2. The company is planning to sell most of its assets within the next few weeks, including its remaining loans, loan servicing division and loan origination platform.
    New Century said Carrington Capital Management had offered about $133 million for the loan servicing unit, which collects and manages mortgage payments. The Royal Bank subsidiary, Greenwich Capital, has agreed to pay $50 million for about 2,000 mortgage loans, most of which are in default.
    Judge Kevin J. Carey in the Wilmington court will consider approving the rules governing the Royal bank sale in a hearing today, and the Carrington sale on Thursday.
    Both offers would be considered opening bids in a court-supervised auction.
    A New Century spokeswoman did not immediately return a call seeking comment. Officials at Greenwich Capital could not immediately be reached for comment.

    APRIL 4 2007

    By Peg Brickley
    (This article was originally published Tuesday)
    WILMINGTON, Del. (MarketWatch) — The judge overseeing the bankruptcy of New Century Financial Corp. Tuesday said he would grant interim approval on a finance package designed to preserve the value of the company’s business, which are destined for the bankruptcy auction block.
    U.S. Bankruptcy Judge Kevin Carey said he would sign off on interim borrowing power for the Irvine, Calif. company, which filed for Chapter 11 protection Monday.
    An interim order for a debtor-in-possession loan from The CIT Group and Greenwich Capital Financial Products Inc. will be worked out and presented for the judge’s signature Wednesday.
    Lawyers for the bankrupt company said the bankruptcy borrowing power is vital to New Century’s hopes of selling its businesses as going concerns and avoiding a liquidation.
    “It would be a fire sale,” said New Century attorney Ben Logan, speaking at the first hearing in the subprime lender’s case.
    Earlier, Carey granted the failing subprime lender interim authority to pay its utility bills, its remaining employees and other necessary expenses until the company’s assets can be sold next month.
    New Century must return to court April 24 to seek final court approval on the Chapter 11 financing, which may reach $150 million. A Tuesday court hearing has been set to consider plans to sell off the remaining businesses of the once high-flying lender.
    Without DIP financing, New Century could be out of money by the end of April, Logan said Tuesday.
    He echoed his partner Suzzanne Uhland, who told Carey New Century was in dire need of quick court action on its finance package, its sale plan and other early motions in what is expected to be a short bankruptcy stay.
    “The fragility of these debtors and their business cannot be overstated,” said Uhland in opening remarks at Tuesday’s court hearing.
    New Century took cover in bankruptcy after major backers shut off the flow of cash and declared the lender in default. The company said it would immediately lay off 3,200 employees, more than half of its work force.
    In mid-March, warehouse lenders began seizing the proceeds from loans made with their money, escalating New Century’s cash crisis and endangering the company’s ability to cover its payroll, said Uhland, an attorney in the San Francisco office of O’Melveny & Myers.
    On Tuesday, New Century went to court to turn the cash back on by way of the DIP loan and an order allowing it to tap cash on hand.
    Conditions on the bankruptcy borrowing call for an auction within 45 days for the loan servicing operation and the portfolio of mortgage loans.
    One of the banks financing the Chapter 11 case, Greenwich Capital, is also New Century’s choice to open the bankruptcy auction bidding at $50 million on a portfolio of mortgage loans.
    Carrington Capital Management LLC is expected to serve as stalking-horse bidder for New Century’s loan servicing business. New Century says Carrington is prepared to start the bidding at $139 million for the servicing rights and platform.
    Uhland said the company also wants to sell its mortgage loan origination platform, which has not been operating for about a month. However, there is no prospective buyer in sight yet for that business.
    Investment banks and commercial banks such as Bank of America Corp. BAC -0.13% , Citigroup Inc. C +0.09% , Credit Suisse Group CS -0.04% , Goldman Sachs Group Inc. GS +0.24% and Morgan Stanley MS +0.21% provided independent mortgage originators like New Century short-term financing, bought loans from them, and pooled those loans into tradable securities to sell to investors.
    Now those banks are watching to make sure their collateral is not compromised in bankruptcy proceedings. Last year, New Century funded $60 billion of subprime loans, Uhland said, and it’s still servicing a $19 billion portfolio of loans.


    By Robert Winnett
    10:00PM GMT 20 Mar 2009

    Traders received multi-million pound bonuses after acquiring more than £30 billion of sub-prime assets during early 2007. Following these purchases the bank “didn’t stand a chance” of surviving unaided, one board director told this newspaper.
    The sub-prime assets are being blamed for causing the bank’s near collapse last year. Last month RBS posted a loss of £28 billion – the largest in British corporate history.
    Sir Fred Goodwin, the former chief executive of RBS, is this weekend under pressure to disclose what he knew of the sub-prime trading.
    He repeatedly put out statements to the City saying that RBS “don’t do sub-prime” even though traders were buying the sub-prime assets. RBS board directors suspect he may have acted negligently.
    British taxpayers are being forced to underwrite the toxic loans bought undisclosed by executives working for RBS subsidiaries in America.

    In a series of interviews with RBS board directors and other senior insiders at the bank, The Daily Telegraph has discovered:
    Sir Fred did not tell the RBS board about the multi-billion pound decision to start buying sub-prime mortgages from other banks.
    RBS began buying up about £34 billion of sub-prime assets as US banks were offloading the mortgages. RBS was unable to sell the assets on as planned leading to the taxpayer bail-out.
    The system of annual cash bonuses encouraged bankers to buy up the assets with insufficient regard to the risks involved.
    The Daily Telegraph has established that Sir Fred told the RBS directors’ board in 2006 that the bank would not be moving into sub-prime mortgage lending.
    However, two senior RBS directors have claimed that the information provided by Sir Fred did not reveal the whole picture. It is claimed that the former chief executive later disclosed that the bank had built up a multi-billion pound exposure to sub-prime mortgages during this period.
    Sir Fred is under pressure to disclose whether he sanctioned the hidden deals or whether he too was unaware of the strategy.
    Sub-prime assets carry high risk as they are based on loans to poorer people who often default on repayment. They have been widely blamed for starting the global credit crisis.
    A former RBS board director claimed: “Sir Fred told the board that the bank was not exposed to sub-prime. Only a year later did he inform the other directors that the bank had, in fact, built up a multi-billion pound exposure.”
    Another board director claimed: “Citizens Bank [a subsidiary of RBS in America] went and bought up packages of sub-prime mortgages. They didn’t go to the board for approval. That was a mistake.
    “People at Citizens were severely reprimanded for their actions, the board did not know. As soon as we knew, it was disclosed but it’s pretty stupid in retrospect. I don’t know whether Fred knew about the sub-prime deals.”
    The disclosure raises serious questions over Sir Fred’s role in the decision-making process. The RBS board is legally responsible for scrutinising key decisions made by executives at the bank. If it is established that key information was not disclosed this could have legal consequences.
    The Financial Services Authority is this weekend under pressure to launch a full investigation into the collapse of RBS. The SEC, the American regulator, has already launched an investigation into RBS’s involvement in the sub-prime market.
    Lawyers acting for the Government are also studying whether there are any grounds to recover Sir Fred’s controversial £17?million pension scheme on the basis of his role in the acquisition of sub-prime assets. Larry Fish, the chief executive of Citizens Bank, retired last April with a pension worth more than $2.2 million annually.
    Vince Cable, the Liberal Democrats’ Treasury spokesman, said last night: “It is very clear from the evidence that there was a major failure of corporate governance at RBS.
    “We need a proper investigation into whether negligence was involved in the decision to build up all these toxic assets. The lack of criminal investigation in this country compared to America is very striking.”
    The Daily Telegraph has been told by several RBS executives that internal controls on the risks being taken by the bank were not adequate. The system of annual profit bonuses has been blamed for encouraging executives to behave recklessly.
    RBS was a medium-sized high street bank. However, over the past five years it embarked on a rapid expansion programme. Sir Fred, the group chief executive at the time, bought rival banks but also oversaw a major expansion in the activities of the investment banking division.
    During a board meeting in the summer of 2006, Sir Fred was asked by fellow directors whether the bank had any plans to move into the sub-prime market. He told the board that the bank would not move into sub-prime and that, as a result, “RBS is better placed than our competitors”.
    In the foreword to RBS’s 2006 annual report, published in April 2007, Sir Fred wrote: “Sound control of risk is fundamental to the Group’s business… Central to this is our long-standing aversion to sub-prime lending, wherever we do business.”
    However, RBS insiders acknowledge that these statements may not have revealed the full picture.
    On April 13 2007, New Century Financial, one of America’s largest sub-prime lenders which was facing bankruptcy, disclosed in a Delaware court that it had agreed to sell 2,000 existing sub-prime mortgages to a unit of RBS – RBS Greenwich Capital Financial Products. Another major US sub-prime lender, Fremont General Corporation, had a $1?billion line of credit extended to it by RBS around this time.
    Citizens Bank, another RBS subsidiary, had also begun buying up existing sub-prime mortgages from other banks from late 2006 – allegedly without seeking approval from the RBS board.
    It is claimed that it was not until the summer of 2007, as Northern Rock was facing meltdown, that Sir Fred told the board that RBS had, in fact, built up a substantial sub-prime exposure.
    Its investment banking division had some £20?billion of sub-prime assets. Citizens Bank had about £14 billion worth of sub-prime exposure.
    By the end of 2007, RBS was beginning to announce losses – or write-downs – on the value of sub-prime assets that had been secretly amassed.
    The majority of the bank is now owned by the Government.
    Last night, Sir Fred declined to comment as he is bound by a confidentiality agreement.
    A spokesman for RBS said: “The reality is that, like many others, RBS was heavily exposed to problems in sub prime markets via its own operations and those inherited from ABN AMRO. This is despite the fact that we did not engage directly in sub prime issuing. The Board was in possession of full information and the details provided to the market in all financial reporting reflected the Group’s honestly held opinion at the time.’’

  4. Ian

    I applaud you — EXCELLENT!!!

  5. I agree with you Enraged…this MUST stop. We the People are here and cannot be ignored anymore.

  6. @E. Toile,

    One more thing: a lot of the info has already been blocked. You can’t access many of the sites through google any longer. It’s called censorship.

    However, facebook is loaded with info.

    You know it’s been blocked when you get the following message (and that has nothing to do with computer/server security. Especially when the site you’re trying to open today was completely available last week…)

    “There is a problem with this website’s security certificate.

    The security certificate presented by this website was issued for a different website’s address.

    Security certificate problems may indicate an attempt to fool you or intercept any data you send to the server.
    We recommend that you close this webpage and do not continue to this website.
    Click here to close this webpage.
    Continue to this website (not recommended).
    More information

    If you arrived at this page by clicking a link, check the website address in the address bar to be sure that it is the address you were expecting.
    When going to a website with an address such as, try adding the ‘www’ to the address,
    If you choose to ignore this error and continue, do not enter private information into the website.

    For more information, see “Certificate Errors” in Internet Explorer Help.”

  7. Global General Strike, May Day 2012

    Friday APRIL 27 – Tuesday MAY 1 , 2012

    While the mayor brags about the NYPD being his own private army, working people’s indignities multiply. At work, under constant surveillance, we struggle for a daily wage, simply to increase the profit margins for our bosses. Previously, the ruling classes had slaves and indentured servants, forcing labor relations through brute force. Today they still have us as slaves and servants through wage labor contracts and fraudulent notions of debt. As we have all seen, debt can be forgiven, in the trillions, to those who own society; but for the rest of us debt is inexcusable, and our lives, our time, our futures, are always negotiable.

    May Day is known the world over as International Workers Day, a day commemorating violence by police and strike-breakers against workers engaged in a general strike to bring about the 8 hour work day. This struggle for the 8 hour work day was not the end goal for those who put their lives on the line in Chicago in 1886, but it was part of a broader aim of destroying the very means of our oppression— capital and the state. This war continues. So too the general strikes of 2012 will establish a decisive drive towards the materialization of a social force to be feared by bosses and politicians the world over.

    It’s time to become this force – a social force capable of attacking our enemies when and where it hurts and sustaining and defending each other in this transformative global moment; a force able to fight and win, a force able to collectively end these indignities and give us the necessary leverage to overcome mediation and to determine our own futures.

    This is a call for a 5 day weekend beginning Friday April 27th, culminating in global General Strike on Tuesday May 1st. We propose using this mobilization as a tool for realizing more global solidarity and mutual aid while creating and strengthening the necessary relations and conditions for revolutionary potential – here and now. We will strike, assemble, block and shut down the city!

    We are New York City Anarchists, Anti-capitalists and Autonomists; we are joining the call for global revolution. In the coming weeks local groups and individuals, along with regional and global allies will help develop and facilitate a framework to organize, coordinate and propagate activities for a 5 day weekend. This will include local and regional organizing bodies, websites and information hubs, resource and skill sharing, and various actions, events, and outreach efforts in the lead up to the General Strike.

    From the struggle that brought the 8 hour work day, to the people who want it all – everything for everyone


  8. @E. Toile,

    Anyway, it’s been discussed for a few months. It is spreading to the entire western world since Goldman Sachs has throughly destroyed everything everywhere. The idea is to get out of that rotten system and return to organizing in small communities, neighborhood, families, human-scale systems, small banks, credit unions, small mom and pop stores and refusing to participate in a Walmart TBTF world any longer.

    I’ve advocated that for a while. I’m definitely in.

  9. Global Strike May 2012
    posted on 2011.12.31 by Anna Harris

    MAYDAY! MAYDAY! It is obvious we are headed for disaster unless we change course drastically, and we don’t have a lot of time. A project is being discussed internationally in the Occupy movement – Global Strike May 2012.

    What we are proposing is a continuous strike, a permanent withdrawal from the current system, a signal for all those who feel their work to be meaningless and unsatisfying, to switch to alternative means which are beneficial to the whole community, to support themselves and their families. In order to make this feasible this alternative system needs to be up and running by May 2012. Outrageous! Impossible! I agree with you. Nevertheless it has to happen if we are serious about moving from this morally bankrupt and physically damaging path we are on, to a sustainable system that puts people before profit. Join us on Take the Squares Network and please pass around to friends and colleagues.

  10. E Toile,

    Those are some of the sites calling for the May Day “global strike”

  11. @ Enraged, general strike? I didn’t get the memo….

  12. I don’t always know what to make of Matt Weidner. I find him extreme at times and yet…

    America is Being Stolen, One Piece of Land At A Time…Who Is The Wizard Behind The Curtain.
    February 18th, 2012 | Author: Matthew D. Weidner, Esq.
    A sane person would think that if parties were going to be throwing millions of people out of their homes and into the streets, collecting hundreds of millions of dollars in the process and performing the single largest transfer of real property in the United States of America since the Louisiana Purchase we would all know who was behind all of this….wouldn’t you? But ignore the big picture, national security/public policy stuff loaded into that big question for a moment. Even if the answer to that first question was no, you would think that at the very least, if you were being thrown into the street you would have the right to know who owned the note and who was directing the foreclosure against you and your family right? Well, this is Amerika folks, and those quaint notions of transparency, open government and justice don’t apply anymore. The banks and servicers that are taking apart this country one foreclosure at a time, taking your home and throwing your family into the street can do as they please and you have no right to know who they are actually working for.

    But it’s not just you that is being kept in the dark. You see, courts all across this country are transferring not just hundreds of millions of dollars, but the actual physical dirt and land and the true foundation of this entire nation, one home at a time, one foreclosure case at a time…..AND THEY HAVE NO IDEA WHO THEY ARE TRANSFERRING THE PROPERTY TO!

    What we do know for certain is that in hundreds of thousands of cases, all across this country, the Plaintiffs that are suing to throw hundreds of thousands of American families into the streets, the Plaintiffs that are taking title to hundreds of thousands of homes and hundreds of thousands of acres of the real property of the United States of Americans are not the owners of the notes and mortgages. They are merely the assassins hired by hidden and undisclosed third parties that are the real parties in interest.

    They are getting away with this now, but it was not always this way. You see, in Florida, the lawsuit form approved by the Florida Supreme Court requires that to state a cause of action for foreclosure, the Plaintiff must allege that they “own the note and mortgage”. But this language that has been used for hundreds of years has been ignored recently and the typical foreclosure lawsuit now reads, “The Plaintiff owns or holds the note and mortgage or has the authority to enforce the same.” Really? Well, which is it?

    And how about you show us all some of where that authority comes from? Oh, right we have no right to ask that question. We should just trust that the bank or whoever is suing really has the authority. I’m sure that’s a wise thing for me to engage in individually and for all of us to consent to collectively. I mean, after all the banks and the financial services industries and their counterparties in government have proven so trustworthy so far. I’m certain we should all just trust them now, especially based on all our prior dealings. No, of course not. We should not trust the first thing coming out of the banking industry and yet they are demanding that our courts trust them on a matter of such profound importance. Trust us, we’re from the banks, with our partners and facilitators in crime the government, and you must trust us when we say we’ve got the right to foreclose on this property.

    Well, here’s one thing we know with absolute certainty. In the vast number of cases the Plaintiff does not own the mortgage they are suing upon. There is an undisclosed third party lurking behind the scenes that actually owns the note and mortgage and that third party directed the plaintiff to do all they are doing. And another thing that is absolutely certain…in a very high percentage of cases, the real owner and real party in interest is that weird version of the federal government called Fannie Mae and Freddie Mac. That’s right folks, the real party in interest in the vast majority of foreclosure cases are secret unidentified parties or the federal government themselves.

    And what happens to all these homes and all this property after all these foreclosure cases are concluded? Well, contrary to all this propaganda about letting the free market take its course and getting these properties back onto the market, in Florida at least the vast majority of properties do not make it onto the free market. What? Whoa? Who? Whaddya mean? I thought we had to get through this foreclosure crisis and move these foreclosures along. Well, the end product of every foreclosure case is a foreclosure auction. A free market, transparent way for the market forces to get a property out of the grubby paws of those damn deadbeat homeowners, determine what a property is worth and get that property into the hands of some deserving capitalist who will put it to its highest and best use….right? Wrong. Not in this nightmarish vision of America foreclosure auctions we see today.

    Take a look at any of the publicly accessible websites that show the outcome of foreclosure auctions in Florida. What you will find is that in the vast majority of cases, the properties return back to the lender that was foreclosing. Oh, there are hungry capitalists out there that would like to bid on the properties, and if they were permitted to purchase them, we would be seeing the private free market at work showing us what these properties are worth, but there are very few properties being released into the free open market. The banks are taking them back for reasons that none of us are being told. Now I’m certain a big part of this riddle has to do with credit insurance on the back end and that the institutions are somehow making more money by not releasing property than they would if they let them sell at the foreclosure auction. And what about the role of those Frankensteins of Federal Government Fannie and Freddie? Well, none of us know for certain, but we do know that they are accumulating and selling properties off in bulk, for cents on the dollar to institutional investors that have been hand picked by the federal government.

    Now back to the question. What business is it of me, gullible and compliant American to care exactly who owns mortgages and exactly who is behind the takedown of millons of homes and untold hundreds of thousands of acres of real property in this formerly free and sovereign nation?

    And how dare I as a defendant in a lawsuit or as an attorney with an obligation to our court system and one who swore an oath to defend my Constitution, how dare I question what is happening in these lawsuits and in our court system and in our country. I should just shut my mouth, move along and stop asking all the questions. No, more directly. If I know what’s good for me and my family, I had better just shut my mouth, move along and stop asking all these questions…..or else.

    Oh, but one last thing. Take a look at a little public record filing from one of the largest purveyors of fraudclosures in this nation. Read these disclosures carefully and then explain to me again why I have no right to know who owns the mortgages that are being executed on in my nation’s court systems….

    We were incorporated in the British Virgin Islands on February 19, 2008 under the name “Chardan 2008 China Acquisition Corp.” as a blank check company for the purpose of acquiring, engaging in a merger or share exchange with, purchasing all or substantially all of the assets of, or engaging in a contractual control arrangement or any other similar transaction with an unidentified operating business which has its principal business and/or material operations in China.

    During the three months ended March 31, 2010, our REO liquidation services business became an increasingly significant source of revenue, generating approximately 5% of our total revenue during that period. Our REO liquidation business has a sole customer through which we generated $3.3 million in revenue for the first quarter of 2010 compared to $1.9 million in the same period last year, primarily due to an increase in the number of REO liquidation files which grew to 1,728 files in the first quarter of 2010, an increase of 56%, from 1,111 files in the first quarter of 2009.


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  13. […] Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud Tagged: 60 minutes, AHMSI, appraisal fraud, attorney general, auction fraud, Chris Koster, Citi, credit bids, DocX Indictment, foreclosure fraud, FORECLOSURE SETTLEMENT, foreclosures, forgery, housing market, housing prices, investors, linda green, LPS, Missouri, mortgage fruad, mortgages, Robo-Signing, settlement, strategic default, whistleblower Livinglies’s Weblog […]

  14. @ Kathy Charlotte

    No offense, NO!

  15. @ Chris
    When our attorney ordered title searches and title ins policies, we discovered an issue at the time of purchase. The origional owners had died and left their estate in a trust for their children. When we purchased the house (out of the trust), the Trust Agreement was not filed with the Trust Deed at our recorders office. We have to go back and find a 13yr old trust agreement to insure title. Then we have three liens from lenders and must provide proof that the 1st and 2nd liens were satisfied. Thereby making the liens Exclusions to any title policy. So here we are …. Would you buy my house if I offered it for Sale?

  16. I don’t know if this will be valuable to anyone here, but I think worth sharing.

    I went and acquired my “work product” from the original closing attorney and have found, numerous questionable entries and the copies of funds transfers, the name of my lender (supposedly) on the settlement statement…4 different owners addition to the one on the top right side of the statement. (5 total). This is the interesting thing: The original transfer from the seller to me, is funky too. I am wondering if the sale of the property to me, was in fact valid at this point. This gets better by the day. The point: I don’t know how many of you have gone that far back, but it’s worth a look see.

    Just my $.02

  17. E. Toile,

    Hence the need to see that May 1st general strike comes to pass. Do what they do in Europe: paralyze transportation of people and goods for a couple of weeks. Once people can no longer go to work for want of gas (transportation required…) or working trains and subways, once they flock to empty supermarkets and empty stores for want of deliveries of goods, all hell will break loose and Obama (or whoever is in charge) will have to act and support justice for all.

    We are not asking for much: the most elementary decency. Equality before the law. A crack at ownership. The means to raise our kids. The right to retire on social security. Some health care coverage. All those things were paid for when we kept on sending IRS our taxes. We never asked to go to Iraq. We never wanted to go to Afghanistan. We sure as hell don’t want to go to Iran. And I don’t know about you but… I am sick and tired of sending billions to Israel and Eguypt to keep “peace” neither ever wanted. Israel and Egypt never got along. Read the Bible!!! Not our problem! Israel lost its country fair and square. Who the hell are we to decide otherwise???

    Our money should serve US first!!!

  18. Just my $.02

    MERS is nothing but a members club, not a legal entity in any way.

    As an additional point: the credit bureaus, which we are also getting raped by, are the same. You have to be a member to join, if not, you’re screwed. Neither of these agencies are playing by the rule of law and in the end, we’re being led to slaughter, at each and every turn.

    The rules MUST change.

  19. @E.Tolle

    Exactly right and astutely put, as always.

    Since the thugs have effectively stolen and sold my home, I’ve got nothing to lose—HOW do we spread the word and rally the troops??

  20. @ Chris
    You Right. I am just so frustrated by how many ways the “Greedy” have found to swindle our hard earned money away from us. We have worked for 30yrs, paid taxes, a mortgage, put our 2 children thru collage and put away for retirement. We did everything we were supposed to do …. Now as Homeowner, a Taxpayer and a Security Invester … I stand to loose in all 3 areas. The Equity in my Home, the Value of my Retirement, and the increase in my taxes.
    And the Criminals got a hand slap, and Big Bank Account.. And I mind you … that I must take legal action against them, keep paying my mortgage and keep paying my attorney. “They told our Attorney … We know nothing about the Title” ….. But Attorney General Madigan does! And she just blew it off …. it is a legal matter,.. you need an attorney. LOL!! Our attorney filed the complaint on our behalf with the Attorney Generals office. We were trying to avoid a lawsuit.
    Sorry for ranting …

  21. MERS was an obfuscation platform meant to stupefy the land courts, mesmerize the county recorders, and pillage the soon to be ex-homeowners. They thought they’d get away with it due to their capture of government. That jury’s still out, but it’s not looking good.

    Their mo was to pick off our homes one at a time as we slid inevitably into default as a result of their predatory practices. Individually foreclose without disturbing the trustees. No one’s the wiser. Easy money. Don’t have to work for it. They just never expected a foreclosure tsunami. But seeing as how it came, why waste a disaster? Take all the homes through mass document fabrication and spread the narrative that the disaster is due to the ATM effect of borrowers gone wild, as well as nasty liberals who believe that the 99% should attempt to rise above housing owned by the Rentier class. Barney’s to blame.

    But it all blew up. Their Securitization Agenda is threatened, and we’re all in the way of their end goal. Thus, the great funneling of monies through front doors and back to save the banks, at all cost. We’re only as good as the pillage opportunities we provide them.

    Ask yourself….where are the victories? Has MERS been dismantled? Where I live they’re still foreclosing in their name. Non-judicial foreclosure spikes, now that the smoke has cleared with the AGs? Has the legislature seen the error of their ways? Are they voicing their contempt at governors stealing homeowner’s monies from this bullshit decree they call a settlement? Has Holder acted on Thigpen, O’Brien, and now San Francisco’s findings? What exactly has changed save for the loud swooshing sound as SOLs expire?

    I’m afraid we’re all so focused on our own legal skirmishes that we’ve lost sight of the war. If you manage to save your home against magnificent odds, what about the 15 to 20 million or more who weren’t as astute or as fortunate as you? Can you live with those numbers? Can any of us who call ourselves civilized stand by as food shelves are emptied and millions seek shelter from the elements? Tell me, what in the fuck good is modern society with its court system, it’s representative government, it’s regulatory hierarchy if all it turns out is hungry citizens into the cold?

    It’s them against us, and we simply cannot exist on the same plane at the same time. It’s a physics problem. We want to raise our families, brew some ales and smoke some pipeweed like good little halflings….and they want to own everything, even if they destroy it all in the process. Screw them. So the point is….even if we’re successful in our own legal battles, we’ll still lose the war if we lose our communities and the folks that once lived in them.

    They have to go. Bring them down. Securitization euthanasia. It’s the right thing to do.

  22. @ Ian

    Nice….Ha, Ha, Ha…

    But not really, this is foul!

  23. LOL @ Ian!

  24. @ Kathy Charlotte

    Do most people realize that many of the “investors” were average working people, who got burned and lost 40-50% of their retirement pensions and such? The working people have gotten burned at every point in this Ponzi scheme.

    It is absolutely mind-boggling, why no one is stopping this theft and deception. There are literally, thousands of people, covering this up, to include Obama. I really don’t know what it will take for the citizens of this country to realize, this is not our government any longer.

    In closing; we all rant on here, but we need to find real solutions to remedy this deception. This is the largest transfer of real property and wealth in the history of the United States.

    How do we as “citizens” by the “rule of law” take back, what is ours? If they can circumvent the law and use it, why can’t we? Example: Putting a lien on my own house for improvements to the property, so I can be paid, in the event of a sale…no payoff from the seller, no clear title. Thoughts please?

  25. chris- re: transferring assets before/after bk filing- If transfer/sale of assets is done without bk trustee’s permission (after filing) or is done with the intent to defraud the bk estate (before filing), the term for this is a ‘fraudulent conveyance’. And is illegal as all get out.
    The court: “Say, what happened to those $6.8billion dollars worth of servicing rights you showed on your books last month?”
    The company: “Well, your honor, in the ordinary course of business, my client has to conduct business in a fiduciary manner so as to protect the underlying value of the assets, thereby preserving said ability to remit payments to creditors, maintain staffing levels,etcetera.
    The court: Yes, but what about the servicing rights? They seem to have been sold for consideration of some type. You got any receipts?
    The company: “Well, if it please the court, we don’t normally ask for receipts, although Linda Green said she’ll attest to and sign anything we want for 10 bucks an hour”.
    The court: Great! Just make sure she signs for the right party, we don’t want any documentation errors……and make sure she uses a valid notary stamp, we want this bk proceeding to go smoothly.
    The company: Thank you, your honor. We at Dewey, Cheatem & Howe, take our legal responsibilities seriously, and seek fair treatment under the law for our client, United Security Bank,or US Bank for short.
    The court: What? United Security Bank? I thought this was USBank,NA?
    The company: Huh? Say what?
    The court: Who?
    The company: Where? Get the complaint-
    The court: All the court has is a ‘Lost Complaint affadavit’ I thought you had the original.
    The company: Wait a minute, your honor, who signed that affadavit?
    The court: It’s endorsed in blank!
    The company: Where?
    The court: What?
    The company: Who?
    The bailiff checks the judge’s pulse, looks at his wristwatch, and says, “Either this man’s dead or my watch has stopped”.
    Case dismissed.

  26. And something just occured to me…

    The reason Obama is in such a hurry to restore blue-collars into jobs, even though they may be paying a lot less and they have a lot fewer unions, is to prevent any uprising by making sure they have a lot to lose if they don’t go along.

    Obama knows that we are very close to riots. He is simply postponing the inevitable by buying the loyalty of a maximum of people, very fast. He never intended to help homeowners. He never intended to help anyone but the banks. It’s all neatly fitting together…

  27. <— says… "See my Evil Grin"? It's NEW. It's the result of the Angel on my Right shoulder battling with the Devil on my Left. Am I to conform to Evil without a battle? Or will I fight back and cover my newly found horns under my Halo? If it is a court order I must have to get back the "Good Title" I gave as collaterial for a fraudulent loan. Then it is a court order I will get! Hell will Freeze over before I pay off a debt and not recieve back my "Good Title"! Did I mention … I was the security investor who lent my retirement money to make it possible for these loans to be funded? I want my retirement back and I want my Good Title Back! "Robo signing is Victimless" ??

  28. @Boots,

    A few months ago, you could find easily a regularly updated list of robo signers. I know, I did many times. Nowadays, it is becoming more and more difficult. As though the information was slowly but surely removed from internet. Or, those sites who do have lists ask that you PAY to consult it, that you become a member.
    (I understand: doing research is so time consumng that we end up doing nothing else. I sad way to make a living…)

    So, here are a few things you can do:

    1) Google the name (Kevin Frost) along with whatever notary name you can see on your docs;
    2) Check if the notary exists and then, google him/her alone. You may get lucky;
    3) Google the name of whatever foreclosure mill appears on your docs along with Kevin Frost;
    4) Google the name of the servicer along with Kevin Frost.

    What you may end up finding (as I did) are similar signatures of people who are purported to have different names but always, always appear with the same notary, the same bank, the same mill.

    I know that, at some point, I was looking for Kevin Frost and came across his signature a few times. I can’t, for the life of me, find the sites. I had them in my favorites but some of them no longer exist, other have changed. I’m telling you: the info is being retrieved from internet slowly.

  29. @Use my name anytime you want 🙂

    That’s what pisses me off.

    We have to wonder if it was a concerted effort right from the start, something like: “Hmmm… We got caught. Let’s figure out how to empoverish the most people the fastest, so that they don’y have money to do anything about it, while investing their billions into counterinformation. Then, we’ll promise them to do things on their behalf, we’ll lead them on, we’ll get them to relax and go along with us, we’ll settle behing their back. And at the last minute, we’ll simply tell them: “Isn’t that a great country of liberties? You can still fight individually! Oh? You have no money left? How can that be with that great settlement you went along with? What? You never, ever voiced your concern? Tough then! If you don’t exercize your rights, too bad. ”

    The danger with evil minds is that they see long term. People who aren’t evil don’t have that in them. So, they get screwed every step[ of the way…

  30. @Ian

    you said;

    “…there has to be a highly organized effort to keep all the lies straight.”

    Exactly right. They are trying to juggle a 1,000 lies when there is only one simple truth.

  31. @ Ian,

    I have been closing watching the bk in DE. The judge said (don’t know time frame) it was okay for NC to transfer assets within months of filing bk, as the time frame was so short it was irrelevant….I beg to differ. There are various time frames in which, a chapter 11 bk filing can sell, transfer or assign assets (mortgages, if they have any) and it ranges from 2-7 years prior to filing the bk, not after, w/o the court/trustees permission…the judge it seems, needs to brush up on his legal rules.

  32. chris,
    I believe that your example is the simplist, clearest snapshot I have read anywhere.
    I too had Ocwen,New Century,as per your previous posts. I believe New Century’s warehouse lender was BOA. And of course, New Century is in CH11 in Delaware. So they were not a bank. Banks can’t declare CH11. They go into FDIC receivership.

  33. chas404- re: Fannie Mae receiving payment for fraudulent loans.
    I have said here before, regarding the monoline insurors,(MBIA, MGIC,RADIAN,ASSURED GUARANTEE,AMBAC,etc), if MBIA paid Credit Suisse $264,000,000 on a $900,000,000 pool of mortgages, to cover defaulted loans,(hence the ins.payment), I find it curious that we are unable to find out which mortgages Credit Suisse was paid for. In other words, the mortgages were paid off.
    But from what we can all gather, the mortgages were never in the pool/trust to begin with. There must be 2 sets of books is all I can figure. And if the loans were sold to multiple trusts, there has to be a highly organized effort to keep all the lies straight.

  34. So, here we are, our AG’s “will allow” us to file claims of our own, at our own expense, if we can afford or find qualified representation.

    It’s been bad enough to realize our government has been bought and paid for, now the AG’s in every state are representing the bank and allowing felonies to be committed each day, with impunity. The going price for each house already sold, $2,000.00. Homes and land haven’t been that price since the 13 colonies were in ratified.

    For me, these transactions are this simple and anyone jump in and tell me where I am wrong. If Enraged (just trying to clear this up, no offense intended) borrows money from Neil and signs a contract with Neil to repay the money, then lends it to me and I sign a contract in blank agreeing to “pay back” the money to Enraged, that does not make me a party to the contract with Neil,(1.) I did not agree to take the money from Neil and did not know it was from him (2.) Enraged does not and is not a “party in interest” of any of my property, as the note is unsecured, as she has no interest or collateral loss if I do not pay her. The first contract is between Enraged and Neil, not me. Then further that, by Enraged saying she is the person/party who funded the loan, which is a lie, as she needs to pay Neil. She arbitrarily fills in the application and endorsement in blank and lies about that to sell it and get her money back, by assuring people she owns the note and my property is collateral, worth 2 1/2 times the face value, which looks on paper, like a great investment, so everyone is posturing to get in on the windfall, not knowing that the original debt was with Neil and Enraged, and Neil never knew I couldn’t afford to pay, nor did he ever know his money was being lent to me? Please feel free to modify this on where I went wrong!

    Just trying to get feedback, as this scenario is very closely what I have. No offense meant to any parties mentioned, just on this forum…I might connect the dots here. I am trying to stay with the simple premises here, as getting into trusts and things matter, but get confusing, without adequate knowledge and knowing where to find the “smoking gun”.


    KEVIN FROST. can someone give me more information about this robo signer? help is appreciated.

  36. We hear about the bad and the ugly. Matt Weidner and Mark Stopa speak quite a bit about the “lost” causes. A lot is happening in courts nationwide and I believe more and more that courts are definitely where the battles must be waged.

    Regardless of what AGs and government decides, the trend is reversing itself slowly but surely.

  37. Am I reading that right? The 5 largest banks are, indeed, walking. The corporations which received all our money are free to keep it and past conduct will not be investigated/prosecuted. It was all a gift to them.

    Well, since those bank keep operating thanks to our bank accounts, savings accounts, credit card payments, mortgage payments, car payments, we can’t complain…

    February 17, 2012

    February 17, 2012

    Philip A. Lehman, Assistant Attorney General for the Consumer Protection Division of the North Carolina Department of Justice, has issued an “Executive Summary” of the settlement between the state attorneys’ general and the five leading bank mortgage servicers. The last section of the summary, that being Section VII, is the most important, and confirmes the matters in our previous post (below) discussing the limited effect of the settlement:

    ” VII. …Claims based on these areas of past conduct by the banks cannot be brought by state attorneys general or banking regulators. The Release applies only to the named bank parties. It does not extend to third parties who may have provided default or foreclosure services for the banks. Notably claims against MERSCORP, Inc. or Mortgage Electronic Registration Systems, Inc. (MERS) are not released. Securitization claims, including claims of state and local pension funds, and including investor claims relating to the formation, marketing, or offering of securities, are fully preserved. … Of course the Release does not affect the rights of any individuals or entities to pursue their own claims for relief.”

    As such, the settlement only precludes actions by state attorneys general for the type of claims which were in their lawsuits which were settled, and has no effect on actions against third-party trustee sale companies (e.g. ReconTrust, Trustee Corps, Regional Trustee Services, Northwest Trustee Services, etc.), MERS, or others who provided “default or foreclosure services”. Claims of individuals are also not affected, which include both affirmative claims and defensive claims in both judicial and non-judicial states.

    Jeff Barnes, Esq.,

  38. I say! E.Tolle,a Capital idea!!! DO let us ring fence the criminals in D.C.&Wall St. with high amperage electric fencing:)And then,let’s add some regular 16 ft chain link around that and top THAT fence off with some of the curly-Q razor wire like I have observed out by the County Jail,near the airport.And around that a shallow moat well stocked with hungry’gators? Keep a few blood Hounds baying nearby,too.I mean,some working class thug who gets sent up for murder 1 gets locked away for life,for the death of ONE individual,right?These “people” are responsible for ruined lives,reputations,credit,families destroyed,health problems,homicides&suicides,pets lost/surrendered…heartbreak….

  39. @chris

    My view on that is FDCPA rules apply…because it would be UNSECURED—you can’t repossess my HOUSE if you are NOT the OWNER…PERIOD. But they did. A third party realtor and his attorney “bought” it…doesn’t that make them a party to a crime???

    Here’s the Huffington Post article re. the new report—can’t I just show the article to the judge at my Unlawful Detainer trial (if there is one…)?…I wish that’s all it took…:(

    Mortgage Fraud: Local Officials Step Up To Uncover Document Fraud
    Local officials are conducting research on mortgage fraud in the absence of state and federal data.

    First Posted: 02/17/2012 7:19 pm

    In the absence of state and federal research about how the nation’s largest mortgage companies are forging mortgage documents and wrongfully foreclosing on borrowers, local officials are stepping up. Earlier this week, San Francisco assessor-recorder Phil Ting released a report concluding that 85 percent of nearly 400 audited foreclosures had serious problems or were outright illegal, providing a rare glimpse into the specifics of foreclosure fraud in America.

    “We really wanted to take a look at what the documents would tell us and whether or not it was something systemic,” Ting said. “We had a lot of anecdotal information but never knew if the problems represented 5 percent or 20 percent or 80 percent of the cases. What we have for the first time is hard data about the level of systematic problems going on in the mortgage industry.”

    Democratic Leader Nancy Pelosi (D-Calif.) called on U.S. Attorney General Eric Holder to follow up on the report’s findings and launch an investigation to determine if federal laws were broken.

    Five years into the country’s unprecedented foreclosure crisis, hard data about the exact nature of the mortgage companies’ abuses remains in short supply. Though federal officials insist they have investigated the problems, they haven’t released their findings, leaving the public to piece together the situation from individual stories of struggling homeowners. Ting joins a very short list of local officials who are trying to fix that.

    Last year, John O’Brien, the register of deeds for Massachusetts’ Southern Essex District, released a report stating that of the 473 audited mortgage loans — all of which were filed with his office in 2010 — 83 percent included erroneous documentation that made it impossible to know which mortgage company owned the loan. The ownership data is key because only a loan’s legal owner has the right to foreclose. More than 60 percent of the problem documents were fraudulent or included forged signatures.

    So incensed was O’Brien with the findings that in June his office announced it would not accept paperwork from any person or company known to engage in document fraud. “We published a certified list of people known to have forged signatures or signed documents they knew weren’t truthful,” said Kevin Harvey, first assistant register of deeds in the Southern Essex District office. “They’d come in and we’d tell them they can sign an affidavit attesting to the fact that they are who they say they are on these documents. Take a wild guess at how many affidavits have been signed. Zero! Zero!”

    Jeff Thigpen, register of deeds for North Carolina’s Guilford County, released similar data. His office conducted a study of 6,100 mortgage documents issued from January 2008 to December 2010. According to Thigpen, 74 percent had problems involving forged signatures and fraudulent documents. He has published on the office website a list of known offenders.

    “When I looked at my data, I began to wonder if my land records office had become a warehouse of stolen property,” Thigpen said. “And the great big question mark is if this will come back to bite the homeowner. A lot of the borrowers are still in their homes. But what happens if they try to sell it at a later date or end up in foreclosure, and the paperwork is messed up. What happens then?”

    Last week, the Obama administration and 49 state attorneys general announced a $25 billion settlement with five of the nation’s largest banks over allegations that the companies committed document fraud and wrongfully foreclosed on homeowners. To arrive at the settlement, federal officials conducted more than 10,000 hours of research and poured through more than 2 million documents. Yet none of the findings have been released.

    “Some documents related to the investigation will be made available upon the filing of a consent order in a federal court,” said Derrick Plummer, a spokesman for the Department of Housing and Urban Development, one of the agencies that investigated the fraud and negotiated the settlement.

    In the meantime, a handful of local officials continue to do their best to address a crisis that is nationwide.

    “What’s going on in Essex County, in San Francisco, in Guilford County are the same things going on all over the United States,” Harvey said. “And part of the reason why we don’t have more loan modifications for borrowers is because the banks don’t know if they own that mortgage because the documents are messed up. It’s all one big viscous circle. And until a major bank executive goes to jail over this, this will continue to occur all over the country.”

  40. @Chas404,

    Actually, that’s why, when you defend yourself and countersue, you bring in a few other people… to make sure that, if there are any pending actions for the same “loan”/”trust”, the plaintiff doesn’t double-collect…

  41. @E Toile,

    Hey, careful there! You’re stealing my idea (stolen from Leno).
    True though: if no one wants to ask the questions, that’s what’s gona happen: the 99% will one day march into NYC, erect a huge 60′ electrified fence, 380 volts, and call the whole damn thing Wall Street Federal House of Correction.

  42. Well,I’ll be dipped in $#@T and rooooolled in breadcrumbs…or,STRAW?!

  43. Let me ask this, as information is spinning in my head:

    If an originator has a line of credit to fund mortgages and subsequently gives me a loan from money they borrowed, from another…I may owe them payments on that loan, but they are not a “party in interest” of my property, but an unsecured creditor. They owe the person who loaned them the money, per contract and unless the lender, who gave the originator the money assigns their right to a property to the originator, they have no rights to anything, except an unsecured note, as “they” borrowed the money to give to me. That does not create a lien or an obligation from me to pay the lender of the originator….right or wrong?

  44. @chris and MD

    They do it because they CAN…isn’t that wonderful? Ahhh…good times we’re living in…good times…

  45. @ chris….My question too!

  46. “…the investors lenders (the securitization documents)…”


  47. the houses are unsecured debt….period……you may never be able to sell it, but you sure as hell do not have to pay some 3rd party servicer…….so stay and fight and live in YOUR house FOREVER

  48. Silly question maybe but this goes to the points above…. If a loan for instance is Fannie Mae (supposedly) and Fannie Mae via FHFA is filing a $15 billion (cant remember the amount) law suit against Deutsche Bank/mortgateIT, Inc. for securities violations etc and FM is alleging that the DB loans were all originated poorly as we all know…

    How can FM then show up in court trying to sue the homeowner for the same or similar loan????

    Seems to me FM has already publicly filed to be reimbursed X amount on the same loan in Fed Court.

    Seems to me quite logical if FM tries to sue me in local court, I should be able to say well sorry FM is in federal court already trying to be reimbursed up to 100% on my loan which MAY be in one of the DB trusts they are suing over. Go sue DB and when that suit is over DB can come after me.

  49. The critical question is why aren’t the regulators in jail over this? A Citi higher up testified 4 years ago that 85% of their offerings were pure shit. I’m convinced the only way we’ll fix these problems is by ring-fencing D.C. and Wall Street with high amperage electric fencing.

  50. Here we go with the insurance again…my question and maybe I am really stupid…how can someone accept proceeds from insurance from a default, to be made whole and then ask the court to sell the property, to be made whole again?

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