Standards and Customary Practices in a Fraudulent Industry

The creation of fake accounts and fake services comes as no surprise to anyone who has been involved in foreclosure defense. As usual the response from Wells Fargo was a blatant lie. It wasn’t 2.1 MILLION fake accounts that were opened, it is now 3.5 MILLION fake accounts and there is more to come. Oh, and another 528,000 customers of Wells Fargo also got signed up for BillPay when they didn’t ask for it.

The point of all this is that Wells Fargo figured correctly that the penalty was worth the gain. By fraudulently expanding its reported portfolio of accounts and services, Wells Fargo had falsely represented a key indicator of its growth and health, causing its stock price to rise. The end result is a few million dollars in “refunds” while the increase in the stock price was worth billions.

Contrary to what Cramer says this is not the case of a rogue bank; it is the case of a rogue industry.

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Most people, whether they are Judges, lawyers or consumers, want to believe that the banks run on trust. But in fact, while the smaller and mid-sized banks run on trust, the large banks have made fraud a customary industry-standard practice. Let me put it this way — it is industry standard practice to violate banking and lending laws.

Hence my admonition to avoid “admitting” anything the banks say in litigation — even the representation that the lawyer has a client or that the plaintiff is the plaintiff. The banks correctly anticipated that judges would come to the conclusion that foreclosure defense was a scam. In order to “move their

The banks correctly anticipated that judges would come to the conclusion that foreclosure defense was a scam. In order to “move their docket” they ruled in ways that would virtually guarantee that the bank or servicer woudl get the foreclosure sale. Swamped by millions of foreclosures (which despite popular belief have not stopped or even slowed down) this was considered the best way to clear out the millions of foreclosures that “had to happen.”

But if we start with the correct supposition that most of the documents used in collection and foreclosures are fake, then judges would return to the old style of scrutinizing the documents proffered by the banks and send the bank’s lawyer packing because the chain of title did NOT match up. THAT would have cleared the dockets much faster as banks realized they would not be able to get their “get out of jail” ticket that came in the form of an official court judgment and an official forced sale of the property. The implication is that everything that preceded the foreclosure judgment and sale was indeed legal. But as we have seen, neither the judgments nor the sales should have been allowed.

It is understandable that judges would lean toward the banks. The logic of the existence of a loan and therefore the existence of a creditor certainly is more appealing than the logic of fake transactions starting with origination and continuing right up to the time of the foreclosure sale. So judges went with the easier, more logical inference that the banks could be trusted even if some of their paperwork was dubious. It may have seemed like the right thing to do, but they got it wrong.

Had judges exercised their inherent right and duty to scrutinize the documents submitted in a foreclosure action, even if the foreclosure was unopposed, there would never have been a foreclosure crisis, even if there might have been a crisis in the bond market where the nominal value of “derivatives” far exceeded their actual value. But if we ever want to truly get over this and not just think it is over because the banks pay for articles announcing the end of the foreclosure crisis, then we must start with fundamentals.

The fundamentals are that in virtually all cases where there are transfers and originations of loans, there was no actual event in the real world. The documents represent a fictional story — and the people who paid for it are all the investors in such deriviatives (worthless) and all the millions of homeowners who were trapped by fraudulent lending practices, fake representations, and appraisals.  Secondarily the rest of society paid for it with entire neighborhoods creashing and in many tens of thousands of cases demolished after the alleged “bank” or “servicer” told the homeowner that they didn’t qualify for a settlement (modification) or that the “investor” had rejected the modification.

The truth is that the investor never heard of the homeowner and the homeowner never heard of the investor. It was all in the province of intermediaries acting as though there was a person behind the curtain when the space was void. The Trusts are empty and no amount of “re-securitizing” into new trusts (whose existence is only suggested on paper with no property entrusted to the “Trustee”) will change the fact that, as between the homeowner and the party named on the note and mortgage, nothing ever actually happened.

Thus the Wells Fargo practice of creating false accounts for their own reasons was merely the outgrowth of the creation of fake loan accounts, fake servicing, and fake foreclosures.




10 Responses

  1. Dear Neil,
    Tomorrow September 7, 2017 a law firm here in Sacramento, California is going to ask me questions about my foreclosure. September 10 it will be 8 years that I lost my home. I want to sue on the basis of robosigning. I was part of the big lawsuit the national foreclosure lawsuit. So am I entitled to sue as an individual. I never did get
    my equity. And the home was a family homesteaded. What I need help on is what to say what not to say, I want to sue on the pretense of the robo signers. Yes I have documents with robosighers. Any words of wisdom out there for me.

  2. Statutes of limitations for stealing houses should be much closer to those for rape and murder. Houses are meant to be permanent possessions, and the pain of losing a home goes on for years, regardless of why it’s lost. And many of the foreclosed don’t find out–can have no way of finding out–for years that the foreclosure was conducted illegally:wrong papers, wrong “lender,”

  3. Meant pg&e does not know how other cretic would be done

  4. WFB denied modification saying those utilities bill is not proof of address I called PG&E she said WFB are not making sense, the service is because You live there! and she does know how other criteria would be done!

  5. WF sent correspondence to cfpb dated June 16, 2017, signed by Melisa King, how is that possible? When that day 4:00pm last thing M King conversation on phone was to make 3 way phone call, me with priest (better spoken than me) + WF + the latest thief services BSI on Next working day Monday! and when we called M. King on Mon we were told she’s terminated! WF Robo signed her signature tWrote all the contradictions of the promising that M King was about to help! She was so companionate trying to reinstate re-evaluate her termination just to confirm robing us fragile couple

  6. I still have all my proof and documents. I should be allowed to sue them and go back to a fair and equitable court.

  7. Wells Fargo stole my townhouse !!!!! Nothing more than a debt collector. Servicer. Using robo sign documents. Post dated. Incorrect balances. I told them all in 2013. they were criminals !!!!!

  8. The foreclosure crisis was created by the banks’ fraud and fraudulent documents, identity theft, robo-signing, robo-perjury, just plain theft and origination fraud from the beginning of the transaction all the way to the end. Justice is not available.

  9. The FACT is: the banks commit fraud on a daily basis. And the judges are both “corrupt” and lacking in knowledge in, legal rules/law to rule on anything! Having been through dozens of hearings, courts and reading thousands of cases….it all comes back to this behavior. The law is not written at their whim, nor is the Constitution. If they cannot figure it our, remove them. Instead of people fighting over statues, the outcome of NFL calls, what Melania is wearing, or how they feel….they should be fighting to keep our government in check. What they don’t understand; it could be them!

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