White Paper Asserts Sham Transactions

Disclaimer: This came into my hands some time ago but I just got around to reading it. While my conclusions are virtually identical to those of the author neither one of us used the material or methods of the other.

Editor’s Comment: In an article apparently intended for publication for November, 2012 (I believe the 2002 year designation in the footnotes is a typo error) Robert Marshall, Research Desk, Producers Management Trust, took a look at securitization. He was appalled by what he saw and wrote an article, a draft of which appears on the link below. His conclusion: “The Deed of Trust executed by the borrower/Trustor did not create an irrevocable trust by surrendering his property rights to intentionally hidden Beneficiaries in an undisclosed securitization process.”

This comes as no surprise to those of us who have been studying the subject for years. What is astonishing is that the paper may have been started in 2002!. His further conclusion: “The deed of Trust was, in fact, a sham transaction which included such dishonest acts as identity theft of the borrower, breach of trust by the purported trustee, who aided and abetted the destruction of the mortgage and theft of the beneficiary/ investor’s money through the common, although questionable practice of “Tier 2 Yield Spread Premium.”

As stated on these pages many times, you don’t need a statute in order to have a cause of action or even to arrest and prosecute a crime. The author agrees: “Until this practice is legislated into criminal activity, it remains a crime under the Common Law.”

In other words, it simply isn’t true that the criminal acts of Wall Street players could not have been prosecuted, although the statute of limitations is probably starting to run out on some of those crimes.

Marshall goes on to state that the elements of a constructive trusts could be imposed, a receiver, accounting, and the real story about how the money was diverted from the REMICS (trusts) and how the documents were diverted from the borrower and the REMIC trusts causing worldwide panic and chaos in the financial world.

As for the homeowner’s obligation: “The evidence gleaned from the constructive trustees [i.e., the Master Servicer, Underwriter and affiliates], may well prove that the investor was in fact paid in full with TARP money and insurance proceeds, thus leaving the homeowner’s obligation fully satisfied.

I would suggest that the article be attached to every expert declaration, report and analysis. For the lawyers, I strongly urge you to consider challenging and denying that the money paid by your client went to the right people (the creditor(s), and that the money used to fund the loan created a common law obligation that was undocumented —- because the documents that were used contained three major defects: (1) they identified a party that neither loaned nor purchased the loan on the note and mortgage and (2) they provided for terms of repayment that differed from the mortgage bond pledged to the investor-lenders in the REMICs (Trusts) and (3) the use of procceds of receipts and payments directly conflict between the note, the mortgage bond and the actual pattern of conduct employed in diverting (i.e., stealing) money from the money stream to the detriment of both the investor-lenders and the homeowner borrowers.

I recommend you study this article carefully:

Deed of Trust Commentary 11-12-02

13 Responses

  1. @ liz,

    My New century stuff is from February 2007…listen carefully here: their lines of credit were shut off, they were under grand jury investigation in CA,. lost license, cease and desist orders from 6 states, Uhland (O’Melveny & Meyers) the attorney for reorganization was scolded from the bankruptcy trustee for withholding information, stonewalling and placing notes with entities that did not own them. Most of the notes in that time frame were seized by, lenders of lines of credit (not original lenders) as New century defaulted on those lines of credit. They also held payments and escrows, defaulted many of ours loans and got insurance proceeds. They were broke then…KPMG their accounting firm lied about their solvency and the Missal report details much of it.

    I have all of this and transcripts, ledgers, amended repurchase agreements, forged documents to servicer counterparts, SPS servcing, Ocwen, etc…it is all clear and documented. Plus a lot more…I did get discovery. Please dig, there is so much on them and in time this will come full circle. No advice here, not an attorney, just experience…hope this helps.

  2. @poppy

    for loans originated 2007, early 2007 before their bankruptcy

  3. @ liz

    What year? In 2 Federal Courts with New Century…I have tons of info on them.

  4. JG: What would be your take on any of the Goldman sachs securitizations, namely GSAMP2007HE2. New Century originated loans, subject of Sec and FHFA v. Goldman???

  5. Mary – of course what you said is true. But I mean, what the heck?
    People have been screaming for how many years now that someone has benefitted from cds’s or insurance or what not. Didn’t AIG nearly bite it under the weight of claims? (and “PMI” filed bk due to claims. It is or was the private mtg insurance company around before mud. PMI insured loans which exceeded 80% loan to value.)
    It’s undeniable that someone got a lot of insurance proceeds on
    default claims. It’s undeniable that in general, one must have a
    present insurable interest to benefit from insurance. That may not be true wth CDS’s. I dont know, but the ins with AIG wasn’t a CDS, or if it were, someone could set me straight.
    What was it judge Riegle said in Mitchell? Something like ” if it walks like a duck, talks like a duck……” Mitchell was one of the bk cases (also Dawson) in NV where it was determined that MERS had no standing for stay relief. Same principle, really: MERS had no skin in the game.
    So back to, say, AIG. If that insurance provided that one must have an insurable interest, it points to the banksters as having that interest, since they aparently got the insurance, which in turn supports the investors having only a security interest in these loans, which in turn, points to their lack of authority to either foreclose or use credit bids. It also points to what if true, I rightfully called an illegal scheme.
    If nobody wants to try to undermine art 3 reliance for enforcement and
    bs assignments by anyone or his brother in MERS’ name, we can look forward to foreclosure until every home is gone to us.
    Gazillions of claims are what would take down an AiG, esp if AIG
    were not capitalized to make the payouts, which also could be the case. But apparently AIG had to pay thousands if not millions of claims. Where did that money go? Mojitas? It either went to mojitas
    or it went to paying multiple payment stream obligations on undefaulted loans which had been sold multiple times either accidentally as a result of a wholley unreliable m.o., or on purpose.
    Further, if “carie’s”, say, original loan had been sold multiple times, her
    refinance might have prompted false defaults to one or more of
    the pools: they had to do something – her refinance would require paying off any and all the pools that were sold her orig loan. That takes a lot of money, so they defaulted them. Why just use this
    “trick” on sub-primes? Got me. One reason that comes to mind, altho
    sparce in its support, is that it wouldn’t make sense to make an A paper loan to a borrower allegedly in default. That is pretty
    dang sparse, but best I can come up with.
    What I am trying to say about sec interests v the trusts having been
    sold the loans pursuant to art 9 is supported not only by the ASF white paper, but by the fact that banksters were able to avail themselves of insurance claims. It may take a village, or even a country, working together to uncover FACTS. We need Nancy Drew and a thousand more like her to come back and start digging. I don’t like looking at such a mountain, either, but I’m pretty sure to
    save ourselves it’s unavoidable. Those skilled enough to get to discovery need to start asking: Did you or any of your affiliates or anyone you know of receive insurance proceeds or anything else of value as a result of the borrower’s (alleged) default? (or make that two questions if it’s compound). Or frame the question more skillfully. Skilled litigators can be going after AIG’s records (say) in regard to the loan at issue. And btw, I maintain this is salient info, so salient it should be turned over without formal discovery in every case subject to FRCP 26. The banksters are aware of Rule 26’s mandates (probably wondering what’s our problem in fact), so they’ve probably got their defenses ready, which means we have to be ready for those defenses. Whatever one’s line of thinking (carie’s, NG’s, h.o. attorneys) I don’t think people are demanding compliance with Rule 26 when they might.
    Insurance companies are regulated by think it’s state insurance commissions or boards. So there’s one source. If there is a white paper, as I maintain there is, which points to secured interest v ownership, there are more like it. Imo, confirming both insurable interest and secured interests (only) of trusts could be a game changer. I concede as to insurable interest, the banksters could have perp’d a fraud on the insurers, but I just can’t believe a company like AIG would let itself be taken down by false claims.
    Has anyone ever gotten an insurance check without the adjuster coming out?

  6. @ carie

    I agree…I have not seen in the cases I read, research (in the thousands of papers) my own personal papers any investor-lender notations or mentioned. Now, I know investors bought bogus mortgage products…and crashed and burned from the selling of bogus loans to them.

  7. Jg. Could get tricky…I suppose…A lot would have to be exposed…

  8. Thanks , Mary. When I asked if party A were entitled to the ins proceeds, I actually meant party B. And like I said, I’d bet party B’s
    entitlement as a secured party is found in the UCC.

  9. OT , but strange (atleast to me)……

    for 5 years i never received any old mail from previous owner, however in the past 2-3 months i notice that im receiving more mail for them than i am for myself……could be paranoid, but very weird ??????

  10. Very well said JG

  11. Okay, NG, I’ll read and study the material carefully. Hope it’s in words of one syllable or less so I can learn something! In the meantime, I’m still working on another stinking white paper, the one from the ASF I ref’d a few days ago, and have this to say about that:
    I don’t know who owns what nor besides discovery and actual sleuthing anywhere possible how to determine and be able to prove who does. But, here’s what I’m thinking after reading that white paper from the Amer Sec Forum, which imo attempts to grab art 9 and therefore contractual compliance:
    the acts of the banksters ultimately (if x,y,z were done) only find
    the trusts with “perfected security interests”. My take on the UCC –
    9-203 – is that one with a perfected security interest in the note
    has a perfected security interest in its collateral – not to be
    confused with an assgt of the dot, or as more relevant to the ASF’s
    propaganda, that the coll instrument “follows the note”: If one has
    a security interest in the note, one has (only) a security interest
    in the coll instrument. It’s a security int in the coll instrument
    which follows a sec interest in the note, not the coll instrument
    itself. Security interests are not ownership of the assets they secure.
    The psa’s call for sales and assignments (pursuant to art 9, it
    appears). They also call for endorsements and assignments (with
    complete chain) of the notes and coll instruments to the trusts.
    I’m no authority on cds’s, that’s for sure. I can spell the words,
    that’s about it. But as to “standard” insurance, one must have a
    PRESENT interest in a thing to recover a loss. Without a present
    interest, one has no insurable interest or loss. (Can’t recover
    collision damage, say, on a car you no longer own) So, IF that’s
    true as to whatever insurance covered these loans, the real crime
    may be that the banksters willfully did not transfer the notes –
    as sales with possession – in order to retain their insurable
    interests. The alternative is the insurance was not subject to
    a present or ANY interest (no int by bankster if sale), which I
    just can’t buy, but then again, who knows. And what about all
    that pmi on any loan over 80% ltv (which the borrower paid for)?
    Where’s that going? Mojitas? GS 4’s? Caymens?
    We’ve all just presumed acts to be done weren’t done because those bums couldn’t be bothered with the paperwork, which
    may have been true early in the game. But I’m thinking a bigger
    reason developed to avoid the paperwork: insurance. The banksters get the money from the investors for the loans (which should have been sales, if not making the investors the lender as I think NG opines), but then the banksters purposely didn’t in fact transfer the notes, which then results (optimally) in a security interest only for the trusts.
    The banksters, by their design, remain the holders of the notes and
    claim a present, insurable interest, a most lucrative proposition
    because they know they’re garbage and were written with the insurance claim in mind. Nice gig and totally fraudulent.
    Hate that word and anyone fighting foreclosure fraud knows why, but there you have it. What makes it fraudulent is that
    the banksters withheld delivery and thus sale of the notes to the
    trusts for their own gain at the expense of the trusts’ rights and
    interests with MENS REA.
    Not meeting contractual provisions is not fraud – it’s something else.
    Non-performance, whatever. But implementing a scheme (there’s that other word) which MUST avoid the contract, planning acts which will avoid the contract, and which scheme and acts benefit the schemer to the detriment of the other party, as well as inducing the contract (false inducement) to enable a wrongful purpose and entering that contract is criminal.
    And on that basis, if the banksters willfully avoided sale, I’d say
    the investors are due a refund of their money (with statutory
    interest) and damages according to proof (finally got that phrase,
    thanks to Abeel.)
    Leaving aside the criminality* (!), if Party A has become indentured
    to Party B, and Party A is compensated for (an alleged) loss on the
    indentured asset, what all does that mean? If Party A is still the
    holder of the notes (and as relevant here, by its own design) and has been or is being paid, doesn’t that mean the debt is retired or being retired by payments from the third party insurer? If Party A is the holder and is compensated for loss, its obligation, the perfected
    security interest, surely can’t form the basis for enforcement against the note maker by ANYone, at least not before barrelling thru Party A first.
    What does that – “that” being compensation to an indentured noteholder for its loss – mean to the maker as well as the secured party as a matter of law or equity? The indenture (security interest) remains to Party B, here the trusts, and therefore the obligation. Since these notes are regulated by the UCC, as a matter of UCC law or ?, is Party A entitled to the benefit of the insurance? I think so and this provisions is probably found in the UCC. If Party B as a secured party is entitled to insurance proceeds, what does that mean to the notemaker? What does it mean to the notemaker if the party with the security interest is NOT entitled to the insurance proceeds pursuant to the UCC? (seems if nothing else, the security interest holder would be as a matter of equity, but I’d hazard it’s addressed in the UCC)
    If Party A has been compensated without compensating the secured party, also seems to me Party B’s first course of action must be against Party A.
    If the trusts hold only security interests, two thing seems certain to me:
    1) as non-holders (and they can’t be made holders post-cut-off-date – can’t change, add, amend, or alter the assets of the trust),
    they are not entitled to enforcement against the makers at all, let alone under 3.
    2) foreclosure by trusts is unavailable (for this if no other reason,
    like FNMA’s repurchase to end guarantee agreement) and banksters can kiss goodbye the credit bids in the trusts’ names. If the true holder of a note has been paid, HE doesn’t even have a
    credit to bid.
    *if creating debt is part of a criminal scheme, should the party
    with the dirty hands be able to enforce the debt (if it didn’t
    get paid otherwise, like with insurance?) In criminal jargon, the
    debt may well be ‘fruit of the poisonous tree’. (That’s
    a phrase generally used in regard to unlawful searches, but I
    can’t see that bars its application here.)
    as always, plebe, non-lawyer, ask lawyer


  13. the middle man was always a liar and a thief !!!!

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