Livinglies's Weblog

The progression from LaSalle Bank to Bank of America to US Bank is highly suspect.

While it is true that there was a merger between Bank of America and LaSalle bank, It is equally true that the merger was preceded by a reverse merger between LaSalle Bank and ABN AMRO. And there is nothing in the public record to tell us what happened in the merger with respect to the position of being a trustee for the alleged trust. Still, the pooling and servicing agreements that are often falsely presented as Trust Agreements will usually say that a successor trustee can be an acquiring bank meeting the requirements of a chartered depository institution.

The big question is whether any of the agreements talk about liabilities as a fiduciary under a trust agreement to specify beneficiaries. The answer is there is no such discussion but there is indemnification language that would cover that subject. There is no discussion of fiduciary liability because there is no fiduciary position. The named trustee has no powers to administer the active affairs of any trust. And the named trust has no assets or business.

The migration from Bank of America to US Bank is even more suspect. The assertion is that US Bank is the successor to Bank of America. If that is true there is nothing in the public record to support that assertion. US Bank is certainly not the successor to Bank of America by reason of any merger or acquisition. That part is definitely true. So the question becomes how did the position of trustee shift from Bank of America to US Bank? I know that there was an announcement of the sale of the position by Bank of America to US Bank, but I know of no legal authority under which a trustee can sell its fiduciary position under a trust agreement to a third-party without the express consent of at least the beneficiaries and probably the original trustor.

But if the sale was actually the sale of a licensing agreement in which Bank of America was receiving fees on a periodic basis for the use of its name as trustee for an alleged trust even though there was no trust, then such a sale would probably be valid — unless it was part of an illegal scheme to defraud the courts and the public. In this case, all those restrictions apply.