Consumer Ignorance: CFPB was your best bet and now you are about to lose it

Several people have greeted the latest news with a yawn. It’s about the 5th Circuit Court of Appeals opining that the CFPB funding was contrary to the required constitutional separation of powers — and, therefore, could not legally do anything.

Most readers seem to think that there is no help coming from the Federal government and that the burden of defending the illegal, fraudulent foreclosures was simply too much to take on. So they gave up.

But a small minority have successfully invested their time, money, and resources to challenge attempts to administer, collect and enforce nonexistent unpaid loan accounts.

Remember that the fact that you did not pay it does not mean that it wasn’t paid off or that anything was due. You only know the transaction from the perspective of the consumer. The consumer does not know the transaction from the perspective of the apparent “lender” nor from the perspective of the investment banker who set up an illegal infrastructure.

The consumer does not receive the legally required disclosures, and the consumer is the victim of active concealment and false pretenses in virtually all installment payment contracts, especially those transactions that are falsely categorized as “mortgage loans.”

I agree that the CFPB COULD have done more, but only if they had been allowed to do so. Republican control of Congress greatly restricted what the CFPB could do. And Trump appointed a chief who believed the agency should be eliminated. richard Cordray would have done a lot more if he had been able to do it.

Recently, the CFPB has been making real progress — legally and politically — against the current banksters. An example is an official recognition that FINTECH is  doing the servicing — not the company named as “servicer.” This success is probably the single reason for the 5th Circuit decision.
That official recognition of FINTECH profoundly impacts the outcome of foreclosure cases that rely on testimony from witnesses who say they are employed by “servicers” that are not FINTECH.
I have done it, and I have seen hundreds of transcripts where other dozens of other lawyers successfully raised an objection that the witness lacked personal knowledge and that the company he/she worked for was maintaining records of business they had done.
Once that objection is sustained, the case against the homeowner is dead in the water because there is no evidence to sustain the claim. But if you don’t make the objection timely and stick with it, it is waived, and the homeowner loses.
The companies designated as “servicers” were not performing servicing functions. This is highly relevant to the issue of whether the evdience is sufficient in court to justify the forcible sale of the property to satisfy an allegedly unpaid loan account.
The lawyers acted in the name of the designated servicer. They produced third-party reports of what other companies had done, not as part of any power of attorney or servicing contract with the designated “servicer.”

This counterintuitive fact is responsible for successfully foreclosing millions of properties based upon false assertions, allegations, and exhibits. The “servicer” was not the servicer. This is still true in most foreclosure cases.

The present opportunity is, therefore, to shift gears in litigating with the foreclosure mills. Focus on their inability to produce records of the servicer performing the functions that are required to produce a report. Thanks to CFPB, you do NOT need to show there is no loan account. You only need to show that there is insufficient evidence that the “servicer” was performing servicing functions.
[Practice Note: Just to be clear, the servicing functions are the physical receipt of payments, depositing those payments into an account owned and controlled by the “servicer,” record keeping of each action undertaken by that company as servicer, and distribution of funds to the creditor(s)]

The 5th Circuit decision undermines ALL of the work done by the CFPB for 14 years. The CFPB was the only federal agency actively seeking to shoulder the burden being forced onto consumers and “borrowers.” The decision appears biased or bought. There is no legal or logical justification for it. But there is a big political reason they did it.

The ONLY way out of this is for people to vote in favor of representatives who are willing to criticize Wall Street. The ignorance of consumers is carried to the ignorance of their representatives (who, after all, were simply consumers before they were elected). Voting on cultural issues and installing candidates who will continue screwing the American consumer is a suicide strategy.


“One must be careful with double-hearsay when applying the business record exception because there may be hearsay in the records that cannot be entered through the business record exception.”

[EDITOR’S NOTE: All documents are hearsay and are inadmissible into evidence unless there is sworn foundation testimony in court that qualifes the documents for credibility, trustworthiness — and as a judicially recognized exception to the hearsay rule.

If it is inadmissible, then upon timely and proper motion, the court (i.e., the judge) should strike it from the record. Once struck, the court may not use that document as the basis for any decisioin or ruling.

  • If the objection is not timely made, it is waived.
  • If the objection is not properly made, it is waived.
  • If the motion to strike has not been timely and properly brought before the court, it is waived.
  • Many lay people get angry with the court for failing to strike heaarsay in the form of fabricated “records” in foreclosure cases. But the court may not strike and must use those documents unless the objections and motions have been timely and properly made. 

5 Responses

  1. All comments here are correct. The CFPB (Warren’s creation) was poorly set-up and, in the process, took away all consumer rights to have issues resolved by state attorney generals. Since the CFPB was created, any complaint to your state AG goes right to the CFPB – who does nothing but close the case on demand by the claimed bank or servicer. It does not matter that your complaint to CFPB shows clear violation of consumer protection laws – your case is closed. Although the CFPB took action against Ocwen in 2017, the prior settlements (Obama) watered down the blatant issues and courts pushed the CFPB back. The CFPB is not your consumer advocate and its creation immediately left consumers with no avenue for complaints.

  2. Neil, you sound like you’re feeling better, I hope that’s true. Neil I agree with your description mechanically. I have worked with the CFPB three times and found they were nothing more than a storefront that you could look through the window and not come in. Yes you can see all the pretty outfits on the inside and will never leave wearing the suit. Trump was naïve and guided by the same cabal that truly started back in Clinton days undoing Glass-Steagall. Trump place trust where he never should’ve. Who was the secretary of the treasurer…. A foundational OneWest criminal. $6 billion fraud anybody? You know the fraud is really big when they give their top salesman for bundling mortgages back in 2007 $3 billion Christmas bonuses. Everybody’s waiting for the statue of limitations to run out on all of the MBSs mortgage-backed securities sitting in everybody’s retirement portfolios worth maybe at best $0.06 on the dollar… More likely much less. I can’t wait to see all the baby boomers storming the capital and their walkers carrying handguns because the long guns will be too heavy. Is there a statue of limitations with Rico if it’s continuing on? It will never be prosecuted. My new mantra is go for the 90% write-down on the mortgage everybody will win except the late retirees.

  3. I followed the CFPB from it’s inception and I agree with Neil on this one. But I can also understand why the financial powers that be would want the CFPB dismantled… afterall… where else can “We The People” find the most complete list of financial crimes committed against us all than where they were all clooectively posted… in the CFPB’s database!

  4. This paragraph sums it all up – regardless of which administration they are all equally liable to the American People cause both parties knew about the truth of these transactions but did nothing.

    The consumer does [did] not know the transaction from the perspective of the apparent “lender” [nonexistent] nor from the perspective of the investment banker [Ponzi schemers] who set up illegal infrastructures.

  5. Trump. Trump. Trump. Always Trump.

    Never Obama or Biden. Trump was 4 years. Obama/Biden going on 12 years.

    It’s an Obamanation!!!!!

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