As I have stated for 14 years, they can’t get anywhere if they don’t have the note unless they prove a lost note. They don’t prove a lost note because the elements of a prima facie case for lost note are that the claimant was given possession of the original note by specified person in a specified transaction.. The banks can’t prove that case because there is original note. it was destroyed contemporaneously with origination of the homeowner transaction that is mistakenly referred to as a loan.
And they have another problem” they can’t get the note into evidence as evidence of the underlying obligation unless they have proper foundation testimony from someone with personal knowledge about the original transaction or, as in this case, by getting the homeowner to admit that the fabricated note she is being shown is the original, that she signed it and that she owes the money.
The homeowner in this video, Renee, refused to admit anything and the lawyers responded with all sorts of tricks to get her to acknowledge her signature on the fabricated note that they were trying to get into evidence. But Renee stayed simple and smart. She said I didn’t sign that document.
The plain truth is that if the foreclosure mill had a case they could win without legal presumptions then they would have gone to court saying it doesn’t matter if that is the original note or not — we have the right to enforce granted to us by the owner of the underlying obligation. But they can’t do that because it isn’t true. And they get away with it because the overuse of litigation immunity.
Renee should not be required to pay on any claim unless it is a valid legal claim. But more than that she should not be subject to claims for enforcement of her alleged obligation when the investment banks are not subject to enforcement of their obligation to compensate her for her absolutely required assistance in launching a concealed securitization scheme. A scheme that did NOT securitize her transaction, debt, note or mortgage. So sale occurred.
She appears to be correct in saying that Wells Fargo, a repeat offender for fraudulent accounts and documentation, was doing it again.
Bottom line: Admit nothing make them prove everything — whether alleged or asserted.
The tricky thing about “loan level data” is that it is easy to slide into unintended admissions, starting with the use of the word “loan.” Sure there was a transaction, but not every transaction is a loan even if it is labelled as such by one party and the other party intended a loan agreement.
*
But if in the end the other party is not the lender or successor lender and there is no loan account receivable on the books of any company, then the transaction may have looked like a loan but it was not. There is no such thing as a loan with no lender and no loan account owned by a party who paid value for the underlying obligation in exchange for a conveyance of ownership.
*
This does not necessarily wipe out the obligation, but it does wipe out enforcement if the claimant does not satisfy the prima facie requirement of owning the underlying debt through payment. Without that ownership, the claimant cannot legally claim loss that damaged the value of the receivable. Because it didn’t own it. And if it can’t claim damage to an asset because it does not own it, then it cannot legally press a claim for redress of a loss that at best would be attributed to someone else.
*
You also don’t want to get caught up in sliding into more admissions when you get into the weeds. “Loan number, Original Balance, Maturity Date, Property State, Property Zip Code, Property City, Pool Number and many more” each have the problems stated above. But the worst culprit is “Original Loan Balance.” We already know that the loan account did not exist in the real world. So that reference alone might trap you into an admission against interest thus establishing that there was an “original loan balance” — because if that existed, so did the obligation to pay it.
*
Sometimes by simply doing a loan level analysis you are erroneously giving life to an obligation that does not exist –at least not without reformation of the total contract that would include adequate compensation to the homeowner who was drafted into a securitization scheme that had nothing to do with ownership of his loan.
*
As I stated in a TV interview in April, 2006, “The real problem is going to be the homeowners who think they know but they don’t. It makes no sense to them that the transaction was not a loan or that they don’t owe the money. That’s why they keep losing. They are admitting something that is self-evident to them but still wrong.”
*
HINT: Let’s say I come to you and said I have this great securitizations scheme that is going to earn big bucks and I told you that you could get in on the ground floor of this opportunity. I tell you that only need to sign a mortgage and note to start the ball rolling. So far consideration for the homeowner is negative.
*
So the homeowner says “”What is in it for me?” I tell you that you get a payment of money that matches the note and mortgage. Now consideration is zero — neither negative nor positive.
*
Then add a wildly inflated appraisal resulting in an immediate loss to the homeowner if he is buying a new home. Consideration to the homeowner is back to negative.
*
Then add the interest, fees, and other charges and the consideration goes negative again. Then I go out and I sell securities that refer to your execution of note and mortgage. Without you signing it, there would be no securitization. Without the securitization there would be no transaction with the homeowner. Without consideration paid to the homeowner, the transaction is incomplete and leaves the homeowner as a newly labeled borrower in a newly labeled loan transaction that has no lender or any established loan account on the books of any company that owns it. All contracts require offer, acceptance, execution and consideration.
*
I just described your transaction from the point of view of the investment bank. They don’t consider themselves your lender or successor lender but they will insist that they should be able to enforce with the choice or designation of a virtual creditor instead of an actual one. And in so doing they seek only to add to profits that already accrued from the securitization scheme. What does the homeowner get? — The shaft.
*
I know I am in trouble with a lot of people for saying this but I am absolutely certain that homeowners (a) are generally not subject to enforcement of the note or mortgage and (b) are owed compensation from a concealed scheme that was the foundation of the transaction.
*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. Inthe meanwhile you can order any of the following:
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
Or call in at (347) 850-1260, 3 PM PDT, 6pm EDT Thursdays
Bill Paatalo through access to Chase’s MSP system has obtained a so-called transaction codes glossary, and “payee codes glossary”, used by Chase to supposedly board WAMU loans, going back to the Chase-WAMU merger of 2008. Screenshots Bill has obtained or made available show massive fraud in the routine altering of servicing records which alterings are used to create false affidavits and declarations and Chase witness testimony leaking into judicial and non-judicial mortgage cases all over the country.
Bill will also discuss briefly how a Wilmington Savings Fund Society “Trust” at once registered with the SEC and the State of New Jersey as a common law trust, while at the same time disclaiming that they were either an individual, estate, or even a trust–disclaiming the latter to avoid making an estimated gross income tax payment.
Charles Marshall will discuss ongoing developments in the use of video and audio in remote court and hearing appearances in the era of COVID-19.
The hardest part of my job is educating lay people about court procedure. It is incomprehensible and nonsensical to most. But there is a certain logic to it and that is what you need to stay mindful about. I have heard too many stories and complaints from homeowners and lawyers who all essentially say that they tried using my blog articles and they failed. The reason is court procedure. Ignoring court procedure was the cause for their loss. By ignoring that fact, they miss the opportunity to turn it around and they erroneously conclude that the material is worthless.
*
Use this email as a guide and it will all fall into place — with the help of a good litigator.
*
The purpose of a court is to hear and resolve real disputes between real litigants with real claims and defenses. Once decided by any court of competent jurisdiction the matter is litigated — res judicata. While we would all like to see justice done, the express purpose of the court is to end disputes with finality. So once it is decided the courts will make it as difficult as possible to keep on litigating. And they will make it practically impossible to litigate the same issue again. The fact that some collateral vertical or horizontal court might have decided the case differently, allowed more discovery etc., is completely irrelevant in virtually all cases. The doctrines supporting finality are almost impossible to overturn.
*
So let’s take your example about fraud upon the court.
*
The first step in the analysis is whether this matter was in fact raised in a case before a court of competent jurisdiction and where the issue was decided already. That means that we must be able to prove with certified copies from the court file that the court had or had not (a) issued specific findings of facts (b) issued conclusions of law and (c) rendered a final order or judgment that included a decision on whether there was fraud in the presentation of the claim to the court.
*
The next step is whether that final order has become final and whether a motion for rehearing was filed and whether the time for appeal has expired. One fatal error committed by inexperienced lawyers and pro se litigants is that they fail to identify the specific order they want overturned. They usually center in on the final judgment.
*
But in actuality the failure of the court to grant a motion to compel discovery might be the real issue. That order denying the motion to compel became a final order when the final judgment was entered.
*
Without asking the appellate court to reverse the order denying the motion to compel the appellant has failed to establish grounds for appeal of the final judgment. That order, incidentally might be grounds for interlocutory appeal (during ligation) saying that you were being denied due process and maybe equal protection.
*
And depending upon which jurisdiction you are in, if you failed to identify the right order in your notice of appeal, you probably waived the appeal altogether — something that requires appellate analysis within days after the final judgment becomes a final rendition of the decision of the trial court.
*
The motion to vacate and motion for reconsideration will meet with the same resistance based upon the same doctrines. Perhaps you can begin to see why appeals are so expensive. It requires a very high level of analysis — much higher than trial work — and many hours of work drafting and redrafting and reviewing and analyzing the issues on appeal. As appellate lawyers our job is to find the winning path — not merely to give voice to our client’s frustrations.
*
The issues on appeal are simple and direct. And they have the effect of Twitter. In one sentence the clerk for the panel judge either gets interested or not. If not, the judge will either not see it at all or will give it a short shrift. If the clerk (a lawyer) sees some interesting stuff that should be decided — or some error that should not be left standing — then the panel judge looks at it. And then a summary is prepared for other judges on the panel who may or may not read the briefs.
*
And if your issue on appeal, motion to vacate or motion for reconsideration is itself an error confusing substance with procedure it is immediately discarded regardless of how “right” the position of the Appellant.
*
Any successful appeal is always predicated upon intense review, analysis, research and peer consults.
*
So back to your fraud example.
*
We all know that the Bank of New York Mellon has no financial interest in the subject loan, does not receive payments from borrowers, does not receive payments on behalf of borrowers, and has no trustee powers over a trust. But here it is. The bank’s name is being used by lawyers for a foreclosure mill. Those lawyers are hiding behind litigation immunity which shields them from any consequences relating to untrue statements made in court. And with the help of plausible deniability, all the fraudulent players seeking to support the foreclosure are also able to hide behind litigation immunity.
*
Knowing something to be true and proving it to be true are two entirely different things because of court procedure. Besides credibility (which must be earned). Talented use of court procedure is the primary reason why one side wins and the other loses. Court process is not random, allowing any party to bring up any issue in any order at any time.
*
Court process requires absolute adherence to the rules. Failure to comply means you waived your point which often means you just concede victory to your opponent even though your opponent does not have an existing client in the case, and there is no claim for restitution for a bad debt, because there is no loan account held as receivable asset on the books of any company. Judgment will be entered for Donald Duck as long as court procedure is followed by the foreclosure mill.
*
Screaming “fraud!” may sound good to you but there are many drawbacks to doing that. The first thing is that fraud must be pleaded with greater specificity than other causes of action (lawsuits). What was the statement? Who made it? When did they make it? How did they make it? Why did they make it? Was there reasonable reliance on that statement to the detriment of the listener. Was the listener the current owner of the property or someone else? How did the listener act to his/her detriment? What difference does it make? The list goes on and on.
*
The second thing is that making a claim of fraud either as a claim or as a defense requires a level of proof that is far higher than other types of civil cases. It is called clear and convincing evidence. That is something almost at the level of beyond a reasonable doubt. Most civil cases turn on the much lower level of “preponderance of the evidence” or “more likely than not.”
*
The third thing about fraud is that you must show an intent to defraud and generally it requires proof of a pattern of conduct in order to be taken seriously. So while we know that Bank of New York Mellon is never, ever going to see one penny of any payment from an alleged borrower nor one penny from the sale of foreclosed property, you can’t and you won’t prove that ever.
*
But you don’t need to prove all that. You need to be informed by all those things so you know how to conduct discovery — basically ask for things that are essential to the prima facie case for foreclosure and specifically those things that you know they can’t or won’t answer or produce. And if you have not mastered this analysis then it won’t even occur to you to object for lack of foundation or best evidence, much less make a timely objection and motion to strike once your motion is granted.
*
Asking for discovery means nothing at trial unless you have pursued it after they have raised objections or filed evasive answers. That’s motion practice and that is where the meat of the case lies. What the judge does with your motion to compel motion for sanctions and motion in limine will most likely decide your case.
*
And as predicate for all the above you need to file thoughtful answers to the complaint (or allegations in Petition for TRO) that will often split into a yes that Bank of New York Mellon is a chartered bank but no it doesn’t have anything to do with this case. Failure to do that results in waiver of the issue.
*
So then the next issues are whether you are pressing a claim that is subject to statute of limitations or a defense which is ordinarily not subject to statute of limitations — and whether a tolling of the statute has occurred in which the true nature of the transaction with homeowner has been tolled by active and even malicious concealment. Remember statutes of limitation are not defenses to defenses but statutes of repose block all claims because of the aforesaid doctrine of finality.
*
So the problem you are facing is that the judge has already heard the case, ignored your defenses, assumed you were deadbeat, and allowed “relief” to someone who didn’t need it. And you have no uncovered data, information and analyses that have convinced you that you made a mistake in even allowing them to send correspondence, much less notices and a foreclosure summons and complaint. And you are clearly of the opinion that the court doesn’t care — a perception that is most probably true.
*
The judge is going to look for any hook he or she can hang their hat on to avoid overturning a case that has already been decided. And the judge will find that hook in the form of deciding that the previous orders essentially covered your new claims of fraud or error. Or, in the alternative the judge will say that you could have learned of this information before and that any reasonable person would have or should have and therefore your claim or defense is barred.
*
And part of the reason that virtually all judges do this is because of one simple basic fact: they all believe the debt or obligation is real and that you breached the term of the agreement. And the cherry on top is that they believe that if homeowners win these cases the whole economy will fail. So one immediate thing you must do is emphasize how your defensive strategies are about this case and no others — although it is prudent to ask in discovery for evidence that Bank of New York Mellon ever received one cent of payment in other cases where foreclosure was rendered as final judgment resulting in a foreclosure sale.
*
But the main thing you need to dance around is to raise the spectacle that not only are these claimants not entitled to anything, but that they are cheating someone else who will never see the money and whose path to recovery will be blocked by this foreclosure proceeding. Such creditors are unaware of even the existence of the pending action and therefore have no way to appear to protect their interests.
*
You must raise the possibility (notice I didn’t say prove it) that this foreclosure is being done for fun and profit and not for restitution of an unpaid debt which frankly doesn’t even exist since it was written off contemporaneously with origination of the homeowner transaction —a transaction whose true nature was the launch of a series of securities created, issued and traded by an investment bank who wanted to enter the residential lending marketplace without the requirement of complying with any rule of law regarding lending practices.
*
In other words give up the thread of your argument about being right and start working on a new thread that gives the judge motivation to want to do something unusual.
*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
They have stopped calling the certificates mortgage bonds because they have nothing to do with the mortgages and they are not bonds.
Hat tip to “Summer Chione”
*
This is a very good article that was written as an email. My compliments to the author.
*
However, after additional analysis and reflection I think I have come to a different conclusion regarding identity theft by the banks. The securities that were sold were merely based upon data reported by the investment bank in its sole discretion — meaning the issuing investment bank (masquerading as an underwriter) could say anything it wanted and everyone else (including counterparties to hedge and insurance contracts) were contractually bound to accept such pronouncement.
*
The actual asset that was securitized was the proceeds of a bet about the value of the fictitious portfolio or data arising out of specific events. All this was done under cover of a scheme in which the certificates that investors purchased were originally labeled as mortgage bonds. They have stopped calling the certificates mortgage bonds because they have nothing to do with the mortgages and they are not bonds.
*
As part of the illegal scheme they pretended to own the debt, note and mortgage of homeowners when in fact nobody did own it. And to corroborate the erroneous presumption that the loans were being acquired through purchase and sale they added personal information about the individual homeowners. So the securities were sold but apparently not the identities. And the identities of homeowners were not actually turned into any sort of commodity.
*
So my current opinion is that, without consent of homeowners, they were name dropping and they were distributing confidential personal information to those who had no actual need to know that information, because the “investors” (i.e., victims) were buying into certificate accounts that conveyed no right, title or interest to any debt, note or mortgage.
*
This means that if a claim exists it might be invasion of privacy. Such a claim would also highlight the fact that securitization of loans does not in fact exist.
*
The following is Summer’s article:
=========================
CoreLogic is much more dangerous than you think.
CoreLogic is a Grey Lord of Black Knight (Fidelity Financial) and Investment Bank whose duty is to PUSH YOU in foreclosure by any possible means. They also manipulate your data in their system and prepare forged documents in foreclosures.
Black Knight and CoreLogic are the actual parties who originates and services your “loan” from money provided them by Investment Banks.
All others are scam. So, don’t try to understand how default debt buyers like Truman Trust or Lone Star or BlackRock got your loan as “default debt”. They never did.
They merely entered their password on Black Knight/CoreLogic’s system where information about your loan is listed as “defaulted”
I use Rubic’s Cube as a sample to illustrate how Black Knight’s system works, just to visualize .
Generally, the cube has 6 sides which can rotate in all directions. You can only see the front of the cube – but not the mechanics.
It used to be purely mechanical game, now it was invented electric self-solving Rubic’s cube.
Now imagine that each side of the “cube” is DATA about your loan and other loans. Green side is performing loan; yellow is default, red is foreclosure, blue are swaps ; white is options; orange are futures or hedge contracts.
Anyone who has client number and password can get asset to DATA about your loan in its square of the cube. But the data always stays inside the cube, only sides are turned into different directions.
Truman Trust most likely has its client number and password in Black Knight/CoreLogic’s system where DATA about your loan is shown as default while Rushmore Servicer has its own password to present you copies of someone’s accounting entries as “evidence of ownership” .
This is how all possible players appear in Elle’s transaction. At some point all of them used Black Knight’s DATA about her loan to trade it while ALL transactions and money were handled by Black Knight/CoreLogic who paid insurance and taxes from investors money while Big Banks pocketed your escrow funds.
While Black Knight uses its system Empower to originate about 62% of ALL loans since 2015; CoreLogic has numerous platform, one of which called Lending Pad.
CoreLogic steal your identity, resell it to millions of other people (particularly predatory lenders) without ANY consent from you or your knowledge; and place you under all possible undue hardships like bogus Flood Insurances – without any FEMA involvement. FEMA agreed to this scam because it means free easy money for them.
CoreLogic is the one who appraise your property above market place to help banks to trade your identity at the higher price.
CoreLogic is the one who secretly from you maintain ALL your data, has access to ALL your credit reports forever.
Lenders can request an Instant Merge credit report and find the most up-to-date borrower information available from the three major credit bureaus—Equifax, Experian and TransUnion.
HOW Merge Credit can get your information from major credit bureaus and WHY nobody tell you about transfer of your data to CoreLogic???
CoreLogic Flood Determinations are the most widely accepted and transferable Life of Loan Determinations on the market. Backed by more than 20 years of experience, CoreLogic guarantees that its Flood Determinations meet all federal regulatory requirements. Using the Standard Flood Hazard Determination Form from the Federal Emergency Management Agency (FEMA), the Flood Determinations provide all of the information necessary to determine whether flood insurance is available or required
This is slavery and terror.
CoreLogic is a part of First American Title (with whom they purportedly “spun” about 10 years ago. Thus, when you get a property Title Insurance from a smaller sham conduit “Title Company”, you get it from the Mafia.
Either from CoreLogic’s FAM or Black Knight’s bundle of Title companies. Smaller “issuers” merely sell you CL or BK policies which will not cover anything.
But I did want to tell you about something I realized today in speaking with clients. It is something that all trial lawyers take for granted. And it’s something nobody who isn’t trial lawyer could ever understand unless it is explained.
You have all heard me say that it isn’t enough to be right. But I never actually told you why.
S + P + C = J
That’s Substance plus Procedure plus Credibility yields a result that is usually a final Judgment.
Here is how it breaks down:
SUBSTANCE IS ABOUT WHAT IS TRUE.
PROCEDURE IS WHAT IS TRUE FOR THE CASE
CREDIBILITY IS WHAT PERSUADES THE JUDGE
JUDGEMENTS ARE FINAL (AND USUALLY PROCEDURALLY CORRECT) EVEN IF THEY ARE SUBSTANTIVELY WRONG.
The substance of most foreclosure cases is that there is no loan account, there is no legal claimant and very often there is no plaintiff in judicial actions nor a beneficiary and non-judicial foreclosures. The documents are all fabricated, forged and backdated. Every exhibit submitted to the court as part of the prima facie case is substantively invalid, a legal nullity.
So why do homeowners keep losing?
Procedure sets up what is true for the case even if it contradicts real world facts. Procedure is what investment banks use against homeowners to pursue a claim in a case in which they are not even a named party. Legal inferences and presumptions are procedural. If you can convince a judge that a document is facially valid and get into evidence then that document raises the inference or presumption of validity even if it was manufactured for court and has no relation to real world facts and events.
How do investment banks get away with that?
First they insert the name of a well known financial institution that everyone (including unfortunately homeowners and many lawyers who represent them) believes is the plaintiff, beneficiary or claimant. Then they get a law firm that seems big to file a lawsuit or notice of sale on behalf of the named bank.
Because the financial institution i.e., a bank like BONY Mellon, Deutsch, US Bank etc) has a longstanding brand and reputation the prosecuting lawyers are generally accepted as credible even though the named bank has no idea how their name is being used in any specific case and has no relationship to the homeowner transaction, its administration, collection or enforcement. This is true even if the lawyers have no retainer or even contact with the named bank that was inserted as Plaintiff or Beneficiary.
The credibility of the named bank is presumed until the court is shown that they cannot believe or should not believe that named bank is connected to the case. The fact that the named bank is not really involved makes no difference. And the credibility of the named bank cloaks the lawyers with credibility.
The homeowner on the other hand must establish credibility. It is generally presumed that an individual borrower is more likely to make extravagant claims than a bank with a 150-year-old history.
And there’s the problem. That is how judgment is entered in favor of a name that doesn’t even identify an actual claimant. If you don’t understand the problem then you can’t solve it.
Or call in at (347) 850-1260, 6pm Eastern Thursdays
It’s getting increasingly hot in the kitchens of the investment banks that cooked up the fake securitization scheme. It has taken 20 years, so far, but now there are clear facts that “contradict” the lawyers who have asserted to the courts that they represent a bank, when they don’t, and that the bank owns the debt, which it doesn’t, or that some certificate holders or trust owns the loan account which they don’t. In fact, the inescapable conclusion is that eh loan account is completely wiped out concurrently with origination of the homeowner transaction.
As you will see in coming days we have uncovered admissions, on record, by CoreLogic about VendorScape and the role of CoreLogic — i.e. as central repository for all images, data and initiation of all actions concerning administration, collection and alleged enforcement of loan accounts that do not appear on the records of any company or financial institution.
Bill Paatalo has obtained intel through his private investigation tools to reveal explosive evidence that WAMU contracted with ACS Image Solutions to destroy loan files in August of 2008, a month before the September 2008 Receivership in BK which WAMU was forced into as a result of the meltdown of their overall accounting balance sheet in the summer of 2008. The establishing of this connection should lead to further legal developments, and we will discuss on the Show how this connection can be used in borrower litigation, both on the Plaintiff’s side and where the borrower is on the Defense side.
The ONLY reasonable or possible explanation for the destruction of what were purported to be original loan files is that they were not originals and they had no relevance because WAMU had long since divested itself of any interest in the debts, notes or mortgages. The contract with ACS might well be a cover for something that had already been done.
Then Charles Marshall will discuss discuss how the COVID-19 eviction moratorium is being used in California’s Alameda County to protect formerly foreclosed Unlawful Detainer (UD) lawsuit defendants literally for a period of months now, and will continue to do so for months into the future.
Here is another case where failing to ask the question “why?” results in a lack of understanding of the process referred to as securitization of debt.
I have previously written at length about how the proceeds from a foreclosure sale are not going to anyone who is entitled to receive them. The article in the above link shows how those with a criminal mind accurately perceived the gap between entitlement and receipt. By intervening in the process, they made off with several hundred thousand dollars. And now they are going to jail.
BUT nobody is asking how the funds became available to criminal minds. AND the answer is that the funds were left because the complex system involving Black Knight and the investment banks sometimes fails and they forgot to designate a party to receive the funds for deposit into a commercial bank on behalf of an investment bank who neither owned nor controlled the debt.
This case corroborates the facts I have reported. The interesting thing is that these defendants are accused of stealing from parties who had no entitlement to the funds. So where is the victim, the loss and therefore the validity of the claim against the criminals? Having criminal intent is not a crime. And theft can’t substantively occur unless there is a victim from whom the money or property was stolen.
So if you steal from a thief are you still guilty of theft? Maybe.
When I first looked at mortgage loans in 2004 I was struck by one simple thing. There was an obvious movement, pushed by the banks, away from original documentation and towards reliance on images. At first I was confused. After all it was the banks who wrote the rules concerning the use of original documentation and the insistence on the availability of original documents.
In 2006-7 it became clear to me what was going on. The banks wanted everyone to rely on images because they didn’t and couldn’t account for the movement of the promissory note without giving a specific date, time and the parties to the transaction in which the underlying obligation has been acquired. Instead they relied on affidavits, declarations and trestiompony from robowitnesses, robo signers and robo offers who neither knew anything nor had any authority to do anything except sign on the dotted line without reading anything.
There were elements of this in the great papert crash of 1968-9, where certificates went missing and many were never recovered. Securities firms collapsed as they had to make good on securities they were supposedly holding for clients. I was there in 1968-9, Director of Securities Research, but consigned to counting stock and bond certificates. I know what happened.
The cheating firms had been selling the same certificate over and over again because they were all in “street name” which means they were legally owned by the firm. the only thing investors had were statements from the firm saying it was holding securities for their account.
With mortgage loans from the year 2000 until now, it occurred to me in 2007 that the only the plan could work was by destruction of the original loan documents. If all the major institutions adopted that stance then everyone would consider that the custom and practice of the industry. If they needed an “original” they would create it.
My “theory” was tested out in the battlefield. Foreclosures were being filed in the name of MERS and in the name of servicers while at the same time denying the existence of any REMIC trust — an assertion which I think turned out to be true.
When the attempt to name MERS and the servicers failed utterly, the banks pivoted to saying that indeed there were REMIC Trusts and that they owned the loans — an assertion that was as untrue as the same assertions for MERS and the servicers. In order lend credence to the newest lie they hired banks like US Bank and Bank of New York and Deutsche to pretend that they were trustees for the REMIC trust — an assertion that was and remains wholly untrue.
That gave the action an institutional flavor and judges started allowing the foreclosures to proceed without any knowledge as to whether the trust existed, whether the debt existed and whether anyone had the right to enforce the debt, note or mortgage.
So beginning in 2007-8 I tested out the theory myself. I sent out hundreds of demands for documents and reconciliations to dozens of servicers.
Just as expected the requests were split into two types of response.
The first was based upon whether the loan was headed into or already in foreclosure, in which case they responded with copies of what hey said were original documents and records of the servicers — but without saying who the servicers were working for. but I already knew the answer to that. The servicers wer working for securities firms on Wall Street — not any REMIC trust or trustee.
The second type of response was more interesting. These were cases in which the homeowner was “current” (on payments that were apparently due on what turned out to be a nonexistent obligation). the response was zilch. No answer.
So I arrived at the conclusion that the documents did not exist and had been shredded contemporaneously with the loan closing, as crazy as that initially sounds. But it makes perfect sense if people are willing to trade on images instead of the real thing. You can always print more images — and sell them.
Which they led me to the conclusion that the documents were being printed to look like originals. But that came with a problem. Someone had to testify to the foundation of allowing those documents into evidence. If they knew what they were doing, they would need to lie. And most people are unwilling to lie in court because that involves jail for perjury.
So the banks hired people who knew nothing and would be kept from knowing anything except their duty to sign documents, the contents of which they knew nothing. These were newly minted documents without the borrower’s consent and attested to by a stamped signature of a person who was willing to accept actually very low wages for “signing” thousands of documents per week. Lorraine Browne at DOCS went to jail for that.
Every signature was worth hundreds of thousands of dollars in foreclosure proceeds but the signor, just like the homeowner who signed the loan documents originally, had no idea they were unleashing a vast revenue scheme in which salespeople were rewarded with more money than they had ever seen.
This is all pretty obvious now to people who have been litigating these cases for any length of time. But to judges, it is incomprehensible that anyone would shred a facially valid note even if there were defense against its enforcement. Promissory notes are cash equivalents. To judges that makes no more sense than shredding a $10 bill. I explained to the skeptical listeners that you WOULD shred the $10 bill if its production would show that it was only $10 when you had represented it to be a $100 bill and had used manufactured images to convince people of that.
But that still left the question of proof of shredding because it is just too crazy to assume it to be true, Enter Bill Paatalo who keeps digging like I do. And he found the exhibit to the agreement between Washington Mutual and ACS Services in which the documents were images and shredded off-site and then the images were delivered — not original documents.
There you have it. And this is wholly congruent with representation from the Florida Bankers Association to the Florida legislature that the documents were customarily shredded at or near closing.
THE BOTTOM LINE: Don’t assume that the original documentation of the loan ws ever delivered to anyone. Without delivery there can be no possession. Without possession it is highly unlikely that they could ever prove the right to enforce.
*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
It is a reality of commerce that virtually all paper documents related to a note and mortgage are converted to electronic files almost immediately after the loan is closed.
Individual loans, as electronic data, are compiled into portfolios which are transferred to the secondary market, frequently as mortgage-backed securities.
The reason “many firms file lost note counts as a standard alternative pleading in the complaint” is because the physical document was deliberately eliminated to avoid confusion immediately upon its conversion to an electronic file. See State Street Bank and Trust Company v. Lord, 851 So. 2d 790 (Fla. 4th DCA 2003).
Verification adds little protection for the mortgagor and, realistically, will not significantly diminish the burden on the courts. The amendment is not needed or helpful.
Tonight I will discuss the curious case of blatant economic fraud on the entire country by investment banks. They figured out how to eliminate the risk of loss on lending, how not to be labelled as a lender subject to lending laws, and who pursue collection, administration and enforcement of obligations that do not exist. And then by denying the receipt of funds that paid off the loan on their own books they continue to operate as though the loan exists, and to designate fictitious entities who are falsely represented by foreclosure mills as owning the defunct obligation.
Specifically we explore how to stop this scheme from operating at all.
Foreclosure litigation is like the game of Chess. The banks line up a set of pawns for you to fight with while their real players hide behind multiple layers of curtains. In my opinion it is time to subpoena Black Knight to the table in most instances. Make them produce documents and answer questions. Note that with Chase (and possibly Wells Fargo) there are periods of time when they had their own alter-ego to Black Knight, so forensic investigation is required.
Black Knight, fka LPS (Lender Processing Services), owner of DOCX and employer of Lorraine Brown who went to jail for fabricating tens of thousands of documents to create the false impression that homeowner obligations still existed and that some designated hitter (e.g., US Bank as trustee for the registered holders of pass through certificates issued by the SASCO Trust a1-2009) owned the obligation.
And then following that logic, since they own the obligation, the refusal of the homeowner to pay the obligation is assumed to have produced a loss (financial damage). And then, following the logic, being the owner of the obligation and having suffered a loss that was caused by the homeowner’s refusal to pay, the lawyers declare a default on behalf of this designated hitter. And then they foreclose.
The possibility that there is no obligation and that there is no financial loss suffered by anyone is currently thought of as stupid theory, thanks to the prolific PR efforts of the investment banks. And yet there is not a single case in which any foreclosure mill has produced any admissible evidence regarding the establishment or current status of the account reflecting ownership of the alleged homeowner’s obligation. Not a single case where actual loss has been in the pleading or notices. For two decades this game has been played by investment banks.
In addition, after the origination or acquisition of the apparent loan transaction, a new player is introduced (e.g. Ocwen), who claims to have been hired to service the loan accounts that are apparently owned by the designated hitter. But Ocwen only partially “services” the account. It might have authority to act as agent for the designated hitter, but the designated hitter has neither authority or ownership of the obligation. So Ocwen is a designated hitter for who ever is really doing the servicing. That party is in most cases Black Knight. In the Chess analogy Black Knight is the Knight who serves its masters (investment banks) and is willing to sacrifice itself and the self-proclaimed “servicers” to protect the King (investment bank).
This means that all records, payment history and document handling does not originate with Ocwen, but rather with Black Knight, who is actually answering to an investment bank who receives both proceeds from homeowner payments, and proceeds from illegal foreclosure sales. And the investment bank receives it as off balance sheet transactions that are actually revenue that is untaxed.
So interrupting the game of foreclosure mills in using “representatives” employed by “servicers” like Ocwen undermines the admissibility of any testimony or evidence from that representative, including foundation testimony for the admission of “business records” as an exception to the hearsay rule. It also brings you one step closer to the King. The harder they fight against you for doing this the more confident you will become that you have hit a nerve — or rather, the achilles heal of this entire scheme that would be a farce if it wasn’t so real.
And lawsuits against the designated hitter might have more credibility if you included not only the designated fake servicer but also the real servicer like Black Knight. And remember the truth is that in virtually so-called loans the end result is that there is no lender and there is no loan account on the books of any company claiming ownership of the obligation. They all get paid in full from “securitization” of the data. But that means that they never sold the debt, which is an absolute condition precedent and standing requirement for bringing a claim.
So when US Bank is named as a claimant by lawyers, those lawyers have had no contact and no retainer agreement with US Bank who is completely unwilling to grant such right of representation for litigation in their name. But for a fee they are willing to stay silent as long as they don’t really need to do anything. And when Ocwen comes in as servicer, they have no original records and they did not board the records of another servicing company. They merely have access to the same proprietary database maintained and owned and operated by Black Knight who has full control over entries (largely automated through the use of lockbox contracts and then scanned), changes and reports.
So maybe it is time to subpoena Black Knight who serves as the representatives of the investment banks and maybe it’s time to sue them for being party to a scheme specifically designed to deceive the courts and homeowners.
Take a look at a submission I just received from Summer Chic:
I received the rest of prop. taxes from 2017 and here is a very interesting detail I want to share.
On November 6, 2019 Black Knight (who deny any involvement to my property*) filed a legal case against PennyMac whom BK accused on theft of their trade secrets and removed from their system.
Almost immediately customers started to complain that PennyMac is unable to perform their “servicing” due to a “major glitch” in their “updated system”.
In other words, PM is NOT able to conduct any functions without access to Black Knight’s MSP.
Since 2017 my taxes were purportedly paid by Caliber – whose tax PO Box was different than PO box for my check payments.
On Sept. 15, 2019 PennyMac purportedly “paid” my taxes.
But on December 31, 2019 (!) my taxes were paid by CoreLogic while the receipt shows as Coreligic-PM. I assume these were Spring taxes (which are due in March) because I don’t see any March receipts.
On September 16, 2020 my taxes were again paid by CoreLogic , now without any reference to PennyMac.
During all time in question CoreLogic repeatedly deny any relationship to my property even though they also conducted appraisal for my property via la mode appraisal software.
In other words, it is clear who handles all escrow accounts.
*On June 15, 2016, or the same day as I filed my application for the loan, Black Knight ordered Flood Map determination acting on behalf of Perl. Determination was done by CoreLogic who is allowed to use FEMA’s forms and who owns a Hazard Map determination company.
*
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. Inthe meanwhile you can order any of the following:
FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
So here is yet another example of litigation done correctly. This case demonstrates that the courts can and will be convinced to rule in favor of homeowners when the correct issue is raised at the right time in the right way. Here are some quotes from the case:
“Compton asserts that the evidence which U.S. Bank sought to admit through (1) the “Declaration of Indebtedness and on Prior Business Records” by Carol Davis (Davis), a “Document Execution Specialist” employed by Nationstar Mortgage LLC d/b/a Mr. Cooper (Nationstar), as servicing agent for U.S. Bank, attached to the Motion for Summary Judgment, and (2) the “Declaration of Custodian of Note” by Gina Santellan (Santellan), a “custodian of original loan records” employed by The Mortgage Law Firm, PLC (TMLF CA), attached to U.S. Bank’s “Supplemental Memorandum in Support of Its [Motion for Summary Judgment],” was hearsay and not admissible evidence.
“someone purporting to be a “custodian or other qualified witness” must establish sufficient foundation upon which to admit the note. In Wells Fargo Bank, N.A. v. Behrendt, 142 Hawai5i 37, 414 P.3d 89 (2018), the Hawai5i Supreme Court ...
“Davis does not attest to being a custodian of records, but an authorized signer for Nationstar.
“Davis declaration does not state that U.S. Bank possessed the Note at the time the Complaint was filed, merely stating that “[U.S. Bank] has possession of the Note,” and that based on Nationstar’s records, U.S. Bank “by and through Nationstar had possession of the original Note prior to 01/24/17, the date of the filing of the complaint in this foreclosure.”
“although Davis attests to Nationstar incorporating the records of Bank of America, the “Prior Servicer,” and relying upon the accuracy of those records, Davis does not aver that she is familiar with the record-keeping system of Bank of America or the lender Countrywide, which purportedly created the Note and signed the blank endorsement. Thus, Davis’s declaration failed to establish the foundation for the Note to be admitted into evidence. Behrendt, 142 Hawai5i at 45, 414 P.3d at 97; U.S. Bank N.A. v. Mattos, 140 Hawai5i 26, 32-33, 398 P.3d 615, 621-22 (2017).
“Santellans’ declaration does not establish the foundation for admission of the Note to establish possession. That is, like the Davis declaration, Santellan does not attest that she has “familiarity with the record-keeping system of the business that created the record to explain how the record was generated in the ordinary course of business.” Behrendt, 142 Hawai5i at 45, 414 P.3d at 97 (quoting Mattos, 140 Hawai5i at 32, 398 P.3d at 621); Fitzwater, 122 Hawai5i at 365-66, 227 P.3d at 531-32) (determining that while there is no requirement that the records have been prepared by the entity that has custody of them, as long as they were created in the regular course of some entity’s business, the witness must have enough familiarity with the record-keeping system of the business that created the record to explain how the record was generated in the ordinary course of business) (quotation marks omitted).
“Viewing the evidence in the light most favorable to Compton, as we must for purposes of a summary judgment ruling, we conclude that there is a genuine issue of material fact as to whether U.S. Bank had standing to initiate this foreclosure action when it was commenced. Accordingly, we conclude that the Circuit Court erred in granting U.S. Bank’s Motion for Summary Judgment.
“Based on the foregoing, the Judgment and the “Findings of Fact, Conclusions of Law and Order Granting Plaintiff’s Motion for Summary Judgment against All Defendants and for Interlocutory Decree of Foreclosure,” both entered on August 10, 2018, by the Circuit Court of the Second Circuit, are vacated. This case is remanded to the Circuit Court for further proceedings consistent …
Or call in at (347) 850-1260, 6pm Eastern Thursdays
Great Gig if you can get it: Lehman Brothers in their bankruptcy (BK) here in 2020–yes 2020–is having to respond to a proof of claim (POC). It was filed in the Lehman BK by Nationstar (nka Mr. Cooper) along with a stipulation which effectively confirms the POC.
The stipulation is to the effect that Nationstar is affirmed to have a right to collect from the debt originator Lehman on the same mortgage debt — which in a typical scenario they would be restricted from collecting solely from the Individual Borrower–in other words the bulk of the listeners to the Neil Garfield Show.
As Bill will discuss, the Obligation under the Note section of the POC at issue here states that: “The Note Holder may enforce its rights under this Note against each person individually or against all of us together. This means that any one of us may be required to pay all the amounts owed under this Note.”
Then on the Show today Charles Marshall will drill down into the latest Covid-19 impacts to civil legal procedure, foreclosure auctions, and unlawful detainer cases, including addressing foreclosure and eviction moratoriums.
So the banks themselves have disclosed the fact that they were laundering money for all sorts of people. And while they probably were paid higher fees than normal money transfers, that doesn’t completely explain why banks, of all business entities, did such a thing on such a wide scale. I have an explanation.
First of course is the fact that they were making these disclosures to regulators who had no capability of even reading the disclosures, much less acting upon them. The argument about regulation is a false choice. There is no argument. Corporations, limited partnerships, trusts and yes, banks are creatures of the state — they are legal fictions whose existence is entirely dependent on state and Federal law. There is no corporation in the natural world. They are allowed because government decided they facilitate commerce, and capitalism in particular. It’s the government that allows them to exist and it is the government that should therefore regulate them. There is no such thing as a free market if only some of the players are allowed to dictate the terms of play. That’s fascism. In the case of false claims of securitization of loans, there is no free market if nobody knows what is really happening. That’s fraud.
Second, this reminds me of 2008 when Bernie Madoff was exposed for committing the “largest economic” crime. That reveal diverted attention from an economic crime that dwarfed the $60 billion that Madoff took. Investment banks converted data about loans into “assets” deriving their value from bets about — rather than ownership of — the loans. In so doing they were able to print counterfeit money. They sold the “data” multiple times without ever having to credit the debt account because there was no debt account. They drove up home prices by selling payments that homeowners could afford in a failing deal based upon falsely inflated appraisals. Then to add insult to injury, they foreclosed on millions of homes. They are about to do that again, with the number of foreclosure filings and reported “delinquencies” (on loan accounts that don’t exist) soaring.
Third, illegal money laundering for terrorists, drug cartels and criminals was a cover for how the banks moved trillions of the money they siphoned out of the U.S. economy. Buried in these reports are clues to what they did with the money. We already know that Goldman Sachs became the leading owner and operator of storage and distribution for precious metals. Where do you think that money came from?
It’s doubtful that our government will find any effective way of clawing back $ trillions of dollars taken out of the US economy and leaving us in fragile condition. But that doesn’t mean we shouldn’t stop them from doing it again. Every foreclosure is another highway robbery. There is no loan account, there is no loss and the money they get from any payments by borrowers or any sales of property goes into the pocket of the investment banks who, in turn, park it off shore for rainy days. When they need money for bonuses, reserves or earnings announcements they need only “repatriate” the stolen money in the form of trading profits.
Pizza delivery guys started earning hundreds of thousands of dollars selling what appeared to be loan products and inreality were invitations to self-sabotage. If something looks too good to be true, then it is too good to be true. The banks wouldn’t hire, much less pay, someone with no formal education, training or experience selling “loan products” unless the investment banks (i.e. securities brokerage firms) were making a thousand times their normal fees through sleight of hand.
*Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
Recently I received a series of emails from someone I highly respect for her persistence and accuracy of research on securitization. She is fighting her own case. And she believes that all the rulings against her are the result of some deep state conspiracy between the banks and the courts. I understand. It certainly must appear that way to pro se litigants. But I don’t agree and I believe that such beliefs undermine the possibilities of success for the homeowner.
So here is what I wrote back to her:
========================================
I completely understand the story and your frustration. But I think your attitude about the court undermines any possibility of reaching a successful outcome. In my experience I have reached a successful outcome, including outright Findings of fact, conclusions of law final judgment in favor of the homeowner. While I think that Court bias accounts for some of the losses by homeowners, my examination of the losing cases shows that they were improperly litigated. Frankly the judge had no choice but to rule in favor of the banks.
For the past 14 years I have sought to empower homeowners in their fight against false claims made by investment banks through fake intermediaries.
In my opinion, the belief that the homeowner will always lose because of some cabal against them that includes the courts undermines any sense of empowerment that any homeowner could have. That is why I take issue with your insistence that this is the case. How can you explain the success that dozens of attorneys, including myself have had in thousands of cases? Either the cabal exists and is all powerful or it doesn’t exist.
Court bias can be and must be overcome in all cases where the odds are stacked against you.
But the odds are stacked against you because of a system of laws that says that if a document is or appears to be facially valid (1) it comes into evidence with proper foundation and (2) everything on it is presumed true.
In the absence of either (1) contrary evidence or (2) a contrary inference to the facts presumed, the presumed facts stand as true for the case and become the law of the case.
When a judge follows those rules he/she is upholding the rule of law and doing what should be done and will not be overturned on appeal. That is not bias.
Since evidence of nonexistence of the debt account is not available to homeowners, the only remaining strategy is to raise the inference that your defense narrative is true. The only way to do that is through discovery and motions and, if necessary, cross examination — the elements of which pro se litigants are totally unfamiliar with. The inference in favor of the homeowner does not and never will arise because the homeowner said so. It will only arise when you ask the right question and persistently litigate the appropriate motions.
*Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
*CLICK HERE TO ORDER PRELIMINARY DOCUMENT REVIEW (PDR) (PDR PLUS or BASIC includes 30 minute recorded CONSULT)*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
“…the question becomes less about why the homeowner should get a free house and more about whether a free house is enough compensation for the unknown risks assumed by borrowers and for their role in starting each securitization process. “
I have a client who sent me a long copy of a report generated that supposedly recounted all data entries relative to her account, except one: the establishment of a loan account owned by anyone.
Here is how I responded:
======================
So I obviously don’t have the time to go over this in any detail. But skimming it, reveals a number of things. The first thing you should remember is that this is a report generated by a report program that accesses one or more databases that were not created, maintained or utilized for INPUT by anyone in Ocwen. If you pursue discovery (assuming you have that option or can create it) this fact could be revealed beyond any reasonable doubt — or raised by inference when they fail or refuse to respond.
Once you do that a few things are true: (1) Ocwen records are no longer qualified as business records exceptions to the hearsay rule because the entries of data were not made at by Ocwen employees at or near the time of any transaction
(a) Any claimed boarding process is charade. Since the records were always on the same server and “boarding” mere consisted of changing login name and password, there was no boarding process. (2) The actual company that owns and operates the servicer(s) containing the data that was used to generate the report, must be named because (a) the actual relationship between the company claiming to be “servicer” and any “creditor” is unknown.
(b) Hence the authority of Ocwen is eliminated. It is not the records custodian for the XYZ Bank as trustee for the registered certificate holders of the ABS Trust pass through certificates. It is not a witness to any transaction and everything they have is generated through the report writing program which is neither owned nor operated by them.
All of that means that the lawyers don’t have a case. And they know that, which is the subject of another piece on why lawyers should not be able to do that. I have had more than one lawyer admit that there was no trust or that it was empty in private conversation. They can only justify their action by saying that even though the securitization scheme was seriously and obviously flawed they were merely enforcing the original intent of the parties. The question therefore is what if that is NOT what is happening?
Since we already know that they don’t have a creditor they won’t be able to produce one. And we know that because the loan account was extinguished or retired during the securitization process in which investment banks received money in exchange for securities that more than covered the debt from homeowners but was never credited to the loan account because the loan account did not exist.
And perhaps more importantly from a proof perspective, the removal of the receivable suspense account arising from funding the origination or acquisition of a “loan” is an admission against interest that the loan account does not exist. So it’s matter of don’t take my word for it, ask the investment bank. They won’t answer — which any experienced trial lawyer will tell you is what turns an accusation into an inference that the accusation is true.
So then you must deal with the underlying theme in all foreclosure litigation — that the homeowner is going to get a free house and is getting away scot free. It’s not fair.
Well here is the truth. It isn’t fair if you look at the entire transaction as only a loan transaction. But it is entirely fair if the benefit received by homeowners is less than the benefit they should have received and would have received had they known the facts and had an opportunity to bargain. And there would have been competition to offer higher incentives to homeowners to execute these weapons of mass financial destruction.
But when you have an announced “lender” go into the deal without any intention of establishing or maintaining a loan account, we have a doctrine called substance over form. Since there is no loan account the intention was obviously to generate profits through some other means. In this case the other means is the sale of securities to investors by misrepresenting their value, concealing the risks and betting on failure of the securities transaction — same as with loans.
So when you look at it from two steps back and are able to see the entire transaction you can easily see that the loan transaction was a ruse in which homeowners were lured into starting a securities scheme, the beginning of which was entirely dependent upon them executing the initial instruments that originated the securitization process — the note and mortgage.
Considering average revenue to the bookrunner investment bank of $12 for each alleged loan, the question becomes less about why the homeowner should get a free house and more about whether a free house is enough compensation for the unknown risks assumed by borrowers and for their role in starting each securitization process.
And before you think that might be overkill, consider this: the loans were not made by anyone who maintained a risk of loss. So the lending process was completely corrupted. the normal expectation of borrowers that they would only be offered a viable loan was blown out of the water. As a result homeowners were surreptitiously being drafted into assuming risks that were concealed and which produced the 2008 crash.
There was no intent by either party in the documented “loan” agreement that had the intent to enter into a loan transaction containing those attributes. One side didn’t see it as loan transaction at all and the other side didn’t know the true terms and conditions.
And as for any windfall argument, consider this: it happens all the time that some litigant gets more than some people think they should. The point is not to base an opinion looking backward but rather to follow the rule of law.
*Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
James got it exactly right not only on the content but also the style. By creating the illusion of a “before” and “after”, the banks have constructed a scenario where our minds tend to fill in the gap with a real transaction — when there wasn’t any such transaction. James please write to me at neilfgarfieldesq@gmail.com to set up the CONSULT.
As counterintuitive as it might feel and seem, there was no before, no after, nor any transaction that was actually a loan transaction. the real transaction was a securitization contract that was never based upon ownership of the loan receivable. Since no money exchanged hands relating to sale of the debt, securitization of the loan cannot be said to exist at any point in time.
Then we frequently go on to admit the existence of the debt, the validity of the note and mortgage and the existence of a creditor who owns the debt — even though there is no such account (because, from the investment bank’s point of view, the debt has been paid off in full).
The company is offering services that would ordinarily (custom and practice in the banking industry) perform several verification tasks — typical for interbank transactions. Verification and confirmation of the debt is one of them. What they are saying is that they will perform all these services regardless of whether or not the loan exists.
The bottom line is that the best strategies in foreclosure defense comes from observing what is not being said or represented. For that to be productive you need to know what would ordinarily be said. Lay people typically have no idea what should be said so they respond to what IS being said and they go down that rabbit hole.
AND the main thing that is NEVER said is “Your Honor, we own this debt, the homeowner refuses or failed to pay it and we are forced to cover our losses through this foreclosure action.” They don’t say that because none of it would be true — subject both the lawyer and the “client” (who isn’t really a client at all) to pay sanctions and even be criminally liable for uttering false instruments and suborning or committing perjury.
Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
Paul Volcker, former Fed Chairman said these derivative instruments would destroy us. We persist in allowing them to exist, to be created, traded, sold and misrepresented as deriving their value from a loan, debt, note or mortgage.
And now, after more than 20 years of development of this scheme, the government is too afraid to “tinker” with the “securitization infrastructure” for fear it will freeze the credit markets when investors stop buying “mortgage bonds” (certificates) that derive NO VALUE OR INCOME from borrower payments or proceeds from foreclosure sales.
Homeowners don’t know how to fight the prosecution of false claims for a nonexistent debt account because, quite understandably, they don’t understand securitization, what it means and how it has been applied.
So here is the simple bottom line. Securitization requires sale of your obligation. For the past 20+ years Wall Street has been securitizing data about your debt and NOT your debt. Your debt is retired from the books and records of all companies as an asset receivable. The debt account reflecting ownership of your obligation does not exist. The example referred to below that I used and which is still the truth of the matter is that all securities sold in connection with what appear to be residential mortgage loans are the same as wagers on a horse race that never happened.
When you lose a foreclosure proceeding you are being forced to gift the entire house, any equity you had or should have had, and a whole lifestyle (possibly including your marriage and your health). That’s what happens when you don’t pay a debt. BUT WHAT IF THERE IS NO DEBT TO PAY?
“Summer Chic” just wrote me an email describing swaps that is exactly on point. I would just add that in many cases the swaps are disguised sales. But as you point out it is not easy to determine what they are selling. It most certainly is not any loans, debts, notes or mortgages.
Here is what “Summer Chic” wrote:
=======================================
Neil had great example re horse race which never happened as a source of revenue on investment.
So, based on June 26th OCC report, the main derivative where Pension Funds invest money are Return Swaps.
$110.6 Billions in 2020, comparing to $152.4 billion in 2013….
All invested in thin-air junk. And the Government knows about it and promotes it as a “reliable investment”
Definition:
A Total Return Swap is a contract between two parties who exchange the return from a financial asset between them. In this agreement, one party makes payments based on a set rate while the other party makes payments based on the total return of an underlying asset. The underlying asset may be a bond, equity interest, or loan. Banks and other financial institutions use TRS agreements to manage risk exposure with minimal cash outlay. However, in recent years, total return swaps have become more popular due to the increased regulatory scrutiny after the alleged manipulation of credit default swaps (CDS).
In a TRS contract, the party receiving the total return gets any income generated by the financial asset without actually owning it. The receiving party benefits from any price increases in the value of the assets during the lifetime of the contract. The receiver must then pay the asset owner the base interest rate during the life of the TRS. The asset owner forfeits the risk associated with the asset but absorbs the credit exposure risk that the asset is subjected to. For example, if the asset price falls during the lifetime of the TRS, the receiver will pay the asset owner a sum equal to the amount of the asset price decline.
Structure of a Total Return Swap Transaction
A TRS contract is made up of two parties, i.e., the payer and the receiver. The payer may be a bank, hedge fund, insurance company, or other cash-rich, fixed income portfolio manager. The total return payer agrees to pay the TRS receiver the total return on an underlying asset while being paid LIBOR-based interest returns from the other party–the total return receiver. The underlying asset may be a corporate bond, bank loan, or sovereign bond.
The total return to the receiver includes interest payments on the underlying asset, plus any appreciation in the market value of the asset. The total return receiver pays the payer (asset owner) a LIBOR-based payment and the amount equal to any depreciation in the value of the asset (in the event that the value of the asset declines during the life of the TRS – no such payment occurs if the asset increases in value, as any appreciation in the asset’s value goes to the TRS receiver). The TRS payer (asset owner) buys protection against a possible decline in the value of the asset by agreeing to pay all the future positive returns of the asset to the TRS receiver, in exchange for floating streams of payments.
Who Invests in Total Return Swaps
The major participants in the total return swap market include large institutional investors such as investment banks, mutual funds, commercial banks, pension funds, funds of funds, private equity funds, insurance companies, NGOs, and governments. Special Purpose Vehicles (SPVs) such as REITs and CDOs also participate in the market. Traditionally, TRS transactions were mostly between commercial banks, where bank A had already surpassed its balance sheet limits, while the other bank B still had available balance sheet capacity. Bank A could shift assets off its balance sheet and earn an extra income on these assets, while Bank B would lease the assets and make regular payments to Bank A, as well as compensate for depreciation or loss of value.
Hedge funds and SPVs are considered major players in the total return swap market, using TRS for leveraged balance sheet arbitrage. Usually, a hedge fund seeking exposure to particular assets pays for the exposure by leasing the assets from large institutional investors like investment banks and mutual funds. The hedge funds hope to earn high returns from leasing the asset, without having to pay the full price to own it, thus leveraging their investment. On the other hand, the asset owner expects to generate additional income in the form of LIBOR-based payments and getting a guarantee against capital losses. CDO issuers enter into a TRS agreement as protection sellers in order to gain exposure to the underlying asset without having to purchase it. The issuers receive interest on the underlying asset while the asset owner mitigates against credit risk.
Benefits of Total Return Swaps
One of the benefits of total return swaps is its operational efficiency. In a TRS agreement, the total return receiver does not have to deal with interest collection, settlements, payment calculations, and reports that are required in a transfer of ownership transaction. The asset owner retains ownership of the asset, and the receiver does not have to deal with the asset transfer process. The maturity date of the TRS agreement and the payment dates are agreed upon by both parties. The TRS contract maturity date does not have to correspond to the expiry date of the underlying asset.
The other major benefit of a total return swap is that it enables the TRS receiver to make a leveraged investment, thus making maximum use of its investment capital. Unlike in a repurchase agreement where there is a transfer of asset ownership, there is no ownership transfer in a TRS contract. This means that the total return receiver does not have to lay out substantial capital to purchase the asset. Instead, a TRS allows the receiver to benefit from the underlying asset without actually owning it, making it the most preferred form of financing for hedge funds and Special Purpose Vehicles (SPV).
Risks Associated with a Total Return Swap
There are several types of risk that parties in a TRS contract are subjected to. One of these is counterparty risk. When a hedge fund enters into multiple TRS contracts on similar underlying assets, any decline in the value of these assets will result in reduced returns as the fund continues to make regular payments to the TRS payer/owner. If the decline in the value of assets continues over an extended period and the hedge fund is not adequately capitalized, the payer will be at risk of the fund’s default. The risk may be heightened by the high secrecy of hedge funds and the treatment of such assets as off-balance sheet items.
Both parties in a TRS contract are affected by interest rate risk. The payments made by the total return receiver are equal to LIBOR +/- an agreed-upon spread. An increase in LIBOR during the agreement increases payments due to the payer, while a decrease in LIBOR decreases the payments to the payer. Interest rate risk is higher on the receiver’s side, and they may hedge the risk through interest rate derivatives such as futures.
*Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
Would you entrust all your money to some thinly capitalized company who wanted total control over all your assets? No you wouldn’t and neither does any bank in an industry that virtually define security and control.
So when I received a recent email regarding a “Power of Attorney” (POA) purportedly executed by Argent/Ameriquest to another company proclaiming itself to be a “servicer” my reply was don’t believe it.
I can virtually guarantee that Argent never executed any power of attorney and that the person who was the signatory was a contract laborer whose signature was stamped or forged. The reason is that no bank or other financial institution would ever sign such a document in earnest. It is all a sham.
This is where knowledge of the industry comes into play. When dealing with assets that are in 6-7 figures, financial institutions have all sorts of protective mechanisms to make sure that the money doesn’t disappear.
Servicing contracts, for example, are very specific if they are outsourced — and nobody gets to change the terms of any mortgage loan without express authority granted in writing by an officer of the creditor company who has been authorized by a corporate resolution from the board to perform that function. It doesn’t happen any other way and that is true for all residential loans regardless of what documents are presented by the lawyers who get them from the servicer who gets them from a document preparation service which is controlled by a central repository (Black Knight) who in turn is operating under strict restrictions imposed by its contract with investment banks or their intermediaries.
So when a modification is executed making it look like the “creditor” is the servicer, without any mention, warranty or representation about the identity of some other group or company that is the creditor, the servicer is not actually doing the modification, even though correspondence is going out on the Servicer’s “letterhead.”
And the servicer cannot then claim that the loan is owned by them because (a) it isn’t, (b) they are operating under restrictions in side agreements that are concealed and (c) the servicer does not actually have any opportunity to handle funds arising from payments from the borrower or from sales of the borrower’s home. All of that is a mirage.
Banks don’t sign or accept real POAs because they are subject to revocation, expiration and in the case of homeowner transactions they are actually quite vague. That is because there are other agreements in which the grantee of a POA agrees that its name can be used but that it won’t really be doing anything.
If that were not true then servicers could have and no doubt would have made off with hundreds of billions of dollars.
This is sleight of hand. They show you one document that looks facially valid, but there are other concealed documents that make it clear that the grantee has no such powers. Every PSA reads that way too. It looks on the front end that the trustee has something to do, but in the end the trustee has nothing it can do.
The side documents to the PSA or POA are the actual servicing agreements and the actual trust agreements that are always concealed. Those are the documents homeowners should be asking for. Accepting the POA or the PSA is a trap.
*Neil F Garfield, MBA, JD, 73, is a Florida licensed trial attorney since 1977. He has received multiple academic and achievement awards in business and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.*
FREE REVIEW: Don’t wait, Act NOW!
CLICK HERE FOR REGISTRATION FORM. It is free, with no obligation and we keep all information private. The information you provide is not used for any purpose except for providing services you order or request from us. In the meanwhile you can order any of the following:
*FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE FORECLOSURE MILLS WILL DO EVERYTHING POSSIBLE TO WEAR YOU DOWN AND UNDERMINE YOUR CONFIDENCE. ALL EVIDENCE SHOWS THAT NO MEANINGFUL SETTLEMENT OCCURS UNTIL THE 11TH HOUR OF LITIGATION.
But challenging the “servicers” and other claimants before they seek enforcement can delay action by them for as much as 12 years or more.
