A NEW FACE in Government Activism in Securitization Scam

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Editor’s Comment:

Anyone who wants the job of being the county recorder takes a risk of being blamed for all the warts and defects that come out after they take office. So when somebody runs for public office without prior real estate experience like a Nurse, you know that community activism is on the rise and we all know why. The shell game and run-around that the banks and servicers are playing can only work so long.

The facts remain that the county recorders across the country fully understand that title is corrupted but they are mostly elected officials, a member of  a major political party and thus follow orders when told to do the Texas 2-step when it comes to removing illegal documents from the recording system or requiring proof of the authenticity of the documents and declarations in the documents.

We need many more people to run for office where it counts — the county level, get rid of the hacks who refuse to sue the banks for screwing up title, refuse to collect fees that are owed and would help the county budget, and refuse to hold those who submitted false filings accountable. THAT is where the banks have little influence. That is where they are weak politically. The lower the political office the less influence the bank has in preventing actions that would embarrass the mega banks.

Eventually the truth will all come out. It is seeping in through all the windows and doors. The logjam will break and we’ll know everything. And what we are going to find is that most mortgages were recorded without any transaction commenced between the the parties recited on the documents. We’ll find that the record is devoid of any real documentation between the real lenders (who might be impossible to determine with certainty because of commingling of funds in escrow accounts that ignored the existence of the REMICs). All that means is that the mortgages were fraudulently filed and therefore the foreclosures are invalid. There lies the path to salvation to our economy. Instead of the big boys getting a handout, the little people who were scrunched into the dirt by the boots of Wall Street titans are going to get a break.

Support with your money , effort and contacts and networking every candidate on the local level who runs for office on the platform of rejecting these illegal documents and throwing out the deeds of foreclosure based upon illegal mortgages and illegal, fabricated, forged and unauthorized documents.

Foreclosure Fraud Combatant Eyes Clerk of Court Role in Florida

By Jon Prior

Florida has been ground zero for foreclosure fraud, but even with multibillion-dollar settlements and federal consent orders, the state’s financial services industry may face new scrutiny from a community activist who’s taken a critical look at the industry and its practices.

Lisa Epstein, who’s running for clerk of court in Palm Beach County, was once an oncology nurse. For most of her career she saw her patients strike deals with their banks when they ran into debt problems, particularly with mortgage payments, once they became ill.

But when the housing crisis struck and foreclosures mounted, that changed. Banks and mortgage servicers overloaded with delinquent loans struggled with the paperwork and the complexity of linking struggling borrowers with decision-makers. To speed up the foreclosure process, reams of documentation was mishandled, signed improperly and filed at county courthouses.

In 2007, Epstein noticed her patients were no longer being helped. They were being rushed through the foreclosure system.

“That was my first hint that there was something very different,” Epstein said during a HousingWire interview.

So began her advocacy work in Florida fighting against banks and third-party firms handling the foreclosure process. In June, she was placed on the ballot for clerk of court of Palm Beach County, the third largest clerk office in the state.

If elected in August, she will be in charge of many things, including managing an overloaded docket, acting as treasurer and chief financial officer of the county’s funds, and most importantly, serving as the keeper of public record.

Her major focus will be on what she claims is a broken system, surrounding the cloudy chain of title flaws filed with the counties to this day. If state funding allows, she said she will perform wide-scale audits of the entire county database and develop reforms — even if that means shutting down the process entirely.

“I don’t know if it is fixable,” Epstein said. “But these are not truly legal instruments that convey proper property ownership. Conducting any sort of real estate transaction or sorting who really owns the loans in many cases will become an enormous legal burden because of the morass of documentation fraud.”

The Florida system remains a nightmare after the collapse of the Law Offices of David J. Stern in March 2011. Several other firms came under investigation and some settled claims before being shut down. The $25 billion foreclosure settlement involving 49 states (Oklahoma didn’t participate) includes language that will hold servicers accountable for any third-party firms that handle any aspect of a foreclosure filing.

Consent orders with the Office of the Comptroller and the Federal Reserve will also force servicers to monitor these firms, specifically Mortgage Electronic Registration Systems and Lender Processing Services ($23.87 1.23%).

New foreclosure filings in Palm Beach County increased in May by 3.6% from the previous month as servicers are looking to restart the process. The 1,356 new filings was 61% above levels seen in the year-ago period.

Both Epstein and incumbent Sharon Bock, who’s held the office since 2003 and is running for re-election, are concerned with keeping up because of pending budget cuts.

“We expect that our foreclosure division is one that will be heavily affected by these budget cuts,” Bock said in a statement accompanying the numbers last week. “My fear is if the trend of increased filings continues as it has in recent months, we will not have the ability to keep up with the volume. We will do our best, but it will be a challenge.”

Mortgage servicers have stated they’ve ended past robo-signing practices and are installing new policies to reduce risk in the system. Few, if any, borrowers, they claim, were foreclosed on improperly because of past flawed practices.

But the financial industry is watching this election closely. Should Epstein prevail, her appetite for audits and new investigations could wipe out any restart to an already backlogged foreclosure process.

Some county record keepers in other states already launched investigations of their own, some founded on faulty claims, but some may have real consequences. A report in one Massachusetts county claimed 75% of mortgage assignments were invalid. Another in San Francisco attempted to show similar results through an audit but shrivels under scrutiny through California case law.

The treasurer for the clerk of courts in two Michigan counties filed lawsuits against Fannie Mae and Freddie Mac to get fees levied during the recording of foreclosure property transfers. The GSEs used a government tax status to escape the fees, an exemption now being challenged.

Epstein said she would be on board with taking all of these actions and suggested the federal government go even further with a wide-scale probe. For this, Epstein is running into a lot of pushback. Her race against Bock has become one of the most heated in the local Florida elections.

“We have to solve a fraudulent process that is hurting our property value taxes, hurting our ability to do a short sale, hurting our ability to work with lenders,” she said. “It’s hurting the faith that there would be some protection. It’s damaging our court systems and yet our court systems are allowing this go on and on.”





26 Responses

  1. […] Read more… Posted in Banks, MERS, News Around The Country, States « Through a Glass Darkly – The State Bar’s Lack of Transparency On Loan Mod Lawyers California State Bar Court Lacks Fundamental Knowledge of Loan Modifications » You can leave a response, or trackback from your own site. […]

  2. Here here, Nora!

  3. Unfortunately for us, tnhairy is right. The letter I got back from the court clerk here in Marietta said exactly the same thing. He said his job is not to vette the documents, but to record them. He wasn’t about to make up new rules like OBrien has in Essex county, he is all about doing what he’s paid to do which is record (shit) documents as long as they are in proper form.
    Lisa Epstein may be traveling the road to hell paved with good intentions. Things are different when you actually get the job, as we have seen with Sam Olens, the GA Attorney General. He pounded his chest on his soapbox while campainging about pressing charges against the criminal bankers, but once elected he abandoned his constituents and refused to talk about the subject further, claiming his office didn’t have authority to do anything about the criminals stealing the homes out from under GA residents. Another thing I don’t like about Lisa Epstein is her former association with Carol Asbury, who’s enjoying a federally funded vacation for mortgage fraud. Birds of feather ? I have become cynical of everything I hear from people running for office, and completely disbelieving of anything I hear from the government, ’cause they’re in on it. Even Ron Paul, who is the only politician I ever believed in, has failed to earn my continued faith.
    I think government needs to be taken over by mothers and grandmothers, as long as Hillary is kept out of things. Our children’s health and welfare will be top priority, as it should be. Who else will look out for the working man better than his wife?

  4. found this—don’t know if it was posted here before or not:


    “…How much of this was the result of a deregulated mortgage system that could be exploited to make a very few people a lot of money, and how much of it was due to old fashioned law breaking? Until we sort that out, I fear this housing crisis will linger, or worse, happen again down the road. How many times? Well, your guess is as good as mine.”

  5. @neidermeyer – have you reported the atty to the bar?

  6. but DCB the role of register/recorder is to accept filings for recording, not the rule on the propriety of those documents. if something comes in that is in accord with the statutes passed by the legislature regarding what may be recorded, then it’s her duty to accept it.

    if what you’re talking about regarding allowing attorneys to pull docs from recording is happening, then stopping that practice is certainly a good idea.

    there haven’t been successes yet on the MERS fees cases, have there? wasn’t the one in Dallas or Houston (somewhere in Texas) supposed to be the one with the most promise?

    i’m all for changing what are clearly improper practices. electing someone to the register/recorder position and hoping they rule by fiat is no solution in itself.

  7. @tnharry ,

    You want an A#1 PRIME example of what a clerk can do for us ,, an honest clerk… I had a challenge to clerks sale at auction attacked because it was “untimely” … opposing counsel had photoshopped copies missing the timestamp/datestamp when accepted by the clerk… they were submitted on the last valid day and not scanned in until the next day … I guarantee you that if I hadn’t personally had my copies timestamped and instead relied on the ones submitted being adequately marked I would have been in deep stuff.

  8. @tnharry ,

    Please stop the pissing match with Carie ,, We can all discuss things on different levels … I for instance would discuss car problems very differently with my 83 y.o. mother than I would with a mechanic ,, yet in both cases I am conveying the same thought. For you to intentionally misinterpret her remark in your 12:02 reply is uncalled for.

    I for one think Lisa will have a HUGE positive impact if she wins … imagine making the parties jump through the required hoops for a change ,, pay ALL the fees , demonstrate the docs are valid when there is doubt… STOP ALLOWING PLAINTIFFS ATTORNEYS TO PULL PREVIOUSLY ENTERED DOCS OUT OF FILES AFTER A CASE! Claw back unpaid fees and so on… A suit with well written discovery to look inside MERS (in order to verify the proper back fees are being charged) will no doubt show a total lack of an audit trail …

  9. turning the “us” and “them” into some sort of class warfare thing. you so far haven’t been one to play the victim card and i see the “us” and “them” as being part and parcel of that.

  10. @Tnharry,

    Twist your words? Show me exactly where, please.

  11. and yet again you twist my words for the purpose of your little editorial rant. kudos to you ma’am

  12. @Tnharry,

    Hence the need for sites such as this one which reveal a slew of issues stupid (but responsible) homeowner could never have imagined in his wildest dream and ends up suffering from… at the hand of you’s. You know, that elite that created the language confusion to allow banks to do what they are doing.

    There are “us” and “you’s”. Us being the people who just want to go to work, have a place to live in, eat well enough, have a vacation once in a while and live in peace. You’s being all those deranged brains who concocted the bubble, caused it to happen, refuse to fix their mess and compound insult to injury by going after… us, for more!

    Definitely us and you’s.

  13. @enraged – there is no “us” and “you” for the purposes of those words. there is only the legal definition. that’s the point i’ve been trying to make – you’re playing in the field of courtrooms and litigation. words have meanings, oftentimes different meanings than you might otherwise use those words for. my point is – carie saying 14 times a day that the notes were “illegal” has no more meaning, effect, or truth than if she said the sky was green. on this battlefield and from this perspective, all that matters is what you can get a judge order.

  14. good show carie – that’s a quote from a case. still not a cite, nor is it even remotely on point for your theory about illegal notes, but it is progress.

    remarkable really that this is the 10th comment on this post and only one has anything to do with the actual article…

  15. @tnharry,

    And by the way… what part of the AGs’ complaint do you still have a hard time understanding?

  16. @tnharry,

    You’re right. For the time being, those words have different meaning for someone like us and someone like you (attorney). So I guess the answer to reestablish fluent and fluid communication, is to go back to a common language. You know, words we can all understand: thief, lie, jail, pillory, guillotine, trivial things like that… things everyone can understand and visualize happening and feel reaqlly tinkled pink about. A common vision of sort.

  17. tnharry—obviously, you are one of those “aiding and abetting”:

    On May 28, 2009, U.S. District Court Judge William G. Young upheld the
    sanctions against Ameriquest, but overturned the sanctions against Wells
    Fargo. Judge Young’s harshest criticisms were for the lawyers involved:
    “After 43 years at the bar, the saddest thing about this case is the
    conduct of the lawyers — all the lawyers. A careful reading of
    the briefs in this case reveals only a single recognition that
    counsel did anything amiss in their misrepresentations to the
    Bankruptcy Court. There’s blame aplenty, of course, each one
    blaming everyone else — including the hapless bankrupt
    homeowner. … How is it that our profession, the legal
    profession —which could have and should have strongly
    counseled against the self interested excesses that set up the
    collapse — instead has eagerly aided and abetted those very
    excesses? How could we (all of us who profess to be lawyers)
    have fallen so low?”
    In a footnote regarding the arguments of Ameriquest’s national law firm,
    Judge Young stated: “This argument is singularly unpersuasive. It is
    tantamount to saying, ‘We’ve been making these misrepresentations for
    years. Until 2005, no one seemed to care.’”

  18. @tolle – those words have different meanings in the law no matter what you and carie may think. and believe it or not, i wish you the best of luck. if you win, then please share your case with the site.

  19. Tnharry, maybe one day I can show you my case. Both the note and the mortgage are “illegal” and should be void….we’ll see whether or not I can get this judicial system to stand up for that or not. They tend to tee up at the same club.

    But I also have undeniable criminal fraud on the part of your brethren at law. Be careful how much you denigrate the idea of criminal, void, and illegal. You may just find yourself on the wrong side of the argument one day. Higher ups have a way of turning on the worker bees, and karma’s a bitch. Don’t worry though, I’ll be your everyday pen pal.


  20. @carie – i appreciate you finally referring to your theory as “crap” in your last post. thank you for your frankness.

  21. Come on, tn…you’re a smart guy…stop playing like you don’t know by now all about this crap.

  22. why do you keep grinding on that carie? show me a case where the note and deed of trust were deemed “illegal”.

    and the idea that they “were not legal” bears a little more explanation as well. illegal implies criminal. what criminal statutes did they violate? do you mean not enforceable or void or voidable? or do you really mean criminal?

  23. oops—I didn’t mean to write back end.er I meant back end…

  24. “I don’t know if it is fixable,” Epstein said. “But these are not truly legal instruments that convey proper property ownership. Conducting any sort of real estate transaction or sorting who really owns the loans in many cases will become an enormous legal burden because of the morass of documentation fraud.”

    It’s NOT “fixable” from the back end.er The instruments are not legal because the original contracts signed by the homeowner/buyers were not legal.

  25. […] Filed under: bubble, CDO, CORRUPTION, currency, Eviction, foreclosure, GTC | Honor, Investor, Mortgage, securities fraud Tagged: county recorder, David J Stern, Fannie MAe, Federal reserve, Florida, foreclosure fraud, Freddie Mac, GSEs, HousingWire, Jon Prior, Lender Processing Services, Lisa Epstein, Michigan, Mortgage Electronic registration Systems, Office of the Comptroller, Palm Beach County, securitization scam, Sharon Bock Livinglies’s Weblog […]

  26. i’m missing how this will help the cause one iota. the county register or recorder is not charged with verifying the accuracy or authenticity of documents, they are charged with recording them. if they meet the legal requirements for being registered as passed by the state legislature, then they must be accepted for registration. for all the stink the gentleman in Essex County made, was there an end result of anything being “un-recorded”?

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