Banking Lesson to Aid Homeowners in Discovery or Statutory Demand Letters

Homeowners and their lawyers look at a canceled check and understandably and reasonably come to an erroneous conclusion. They think the check shows who physically received the check, who deposited it into a depository account, and who owns that account.
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Therefore, they erroneously conclude that the report issued under that name was prepared by or on behalf of the name they think they know, and that report is waived into evidence as a business record under an exception to the hearsay rule barring hearsay from the record of the evidence that a judge is permitted to consider.
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This forms the pretext under which nearly everyone believes that payments from the homeowner were due, payments made by the homeowner were posted as a reduction of the balance due on an accounting ledger of the designated owner of the obligation, and that the claimed amount due is equal to the amount shown on that ledger. The problem, of course, is that there is no such ledger, and there is no amount due.
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All of this stems from the natural human tendency to believe what we read. Every con job usually involves the fabrication of some document. And the more official it looks or the more official the circumstances appear, the more it is believed. Wall Street has weaponized this phenomenon into the biggest economic scam in human history. And for good measure, we should note that repetition places fiction into the category of fact.
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It has been so successful that even government officials have erroneously concluded that they know something. Mainstream media stopped all investigative reporting back in 2010 just went they were getting close to the truth.
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So you look at the markings on a negotiated check. What is contained in the depository agreement or instructions? You don’t know. But when looking at these cases, I do know that this shows clear evidence of the customary practice of dealing with payments from homeowners. This is the process of concealment and cover-up.
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The lawyer or homeowner needs to know how the system works before they decide on which facts to contest — i.e., which documents to ask for and what testimony you want to elicit from an authorized officer or employee of the designated company. This is done by notice if the company is a named party or by subpoena if the company is not a named party.
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Banking lesson.

  1. A depository account is a liability of the bank that accepts deposits.
  2. The owner of the account is the depository bank.
  3. The owner of the contents of the account is the depositor — or whoever is designated by the source of the deposit.
  4. The owner and the depository bank enter into a contract that covers the terms of the deposit and the availability of funds after the deposit. That agreement sets forth various possibilities and what happens when one of those possibilities occurs.
  5. In business situations, it is common to have the name of an account shown as whatever name is designated by the owner in the contract. So, for example, if the owner is JPMorgan Chase, it could give a name to the account of SPS. So when people issue payments to SPS, it is going to JPM Chase. But the people think they paid SPS. Therefore they think they know that SPS is a servicer.
    1. And they think that SPS must have deposited the check to its own account and then issued distributions to a creditor or agent of the creditor.
    2. Therefore they think that the report issued under the name of SPS was prepared by SPS and represents transactions conducted by SPS. This results in the report being accepted as a “business record,” which is accepted as a substitute for the collateral loan account owned by the designated claimant (creditor or owner of the lien).
    3. The court proceeds without any evidence of the existence of an unpaid loan account, and judgment is entered as though such evidence and been produced.
    4. However, if SPS did not have an employee or officer receive the check and deposit it into an SPS account, any report issued regarding homeowner payments and balance due would be hearsay and not allowed into evidence as an exception to the hearsay rule. In plain language, the report would be a compilation of reported facts from third parties other than SPS. That is exactly what the hearsay rule was designed to prevent because of the opportunity for mischief.
  6. Also, in business situations, it is quite common to set up a depository account that is cleared every night. The terms of clearance are set forth in the depository agreement, which probably refers to receiving instructions from the owners. Those instructions must be in writing.
    1. The terms of clearance may create a funnel to one other account or many other accounts —  each owned and operated as described above.
    2. So continuing our example, if homeowner Smith sends a check to SPS, something is happening that is not apparent but also NOT illegal.
    3. The check is not received by SPS and is never deposited into any account that is owned or controlled by SPS. Therefore SPS has no record of receiving it because it didn’t receive it and no record of making any deposit because it made no such deposit.
    4. It is deposited, in our example, into an account owned by JPMorgan Chase because JPM retained control of the money trail and the paper trail — even though it did not legally own or even claim to own any right, title, or interest to any payment from homeowner Smith.
      1. In turn, the check deposited to the account name of SPS is cleared to several different accounts, each also controlled by JPM. Some of those accounts are to subsidiaries or controlled business entities organized and existing under the jurisdiction of off-shore places.
      2. But again, the reasonable conclusion drawn by Homeowner Smith is that he owes a debt, and it is being collected, deposited, and distributed to creditors as he makes payments. This is not the case. It is never the case. But as long as the homeowner believes it, it is likely that his/her lawyer will believe it.
        1. And thus, the facts become uncontested even though they are untrue. Once that is established, the judge has no choice but to apply the uncontested facts to the case and then enter a ruling based on those uncontested facts.
        2. Are they lies? Yes, but they are reasonably believed by both the homeowner and the lawyer. Federal and state agencies are chartered to address widespread problems like this one. But the failure of those agencies to act dumps the burden onto the uninformed or under-informed homeowner and the uninformed or under-informed lawyer for the homeowner.
      3. There is a record of this bank activity, and it is accessible through the rules of discovery and, to a lesser degree, through the laws governing qualified written requests and debt validation letters.
        1. Whatever value the QWR or DVl might have is usually squandered by well-meaning but uninformed homeowners who attempt to substitute the QWR or DVl as a discovery demand. That only enables the recipient to ignore most parts of the request.
        2. Through enforcement of those laws and rules in court, homeowners win- not by proving that the other side is composed of dark figures who should be shot.
      4. The banks know that, and they employ thousands of lawyers to side-step the obligation to respond to any legal request regarding the ownership and control of any account.
      5. The structure of this plan leaves an essential question unanswered: who is the party that must respond to the QWR or DVL?
      6. To the extent that the names used by JPM do not represent companies that perform any function, it is difficult under current rules to ascribe an obligation to answer the QWR or DVL.
      7. But there is one exception to that “rule.” If one of the company names used by JPM is, for example, Bank of New York Mellon, U.S. Bank or Deutsche Bank National Trust Company, and that company is represented as the owner of the right, title, and interest to payments received from homeowner Smith, then that Bank is required to answer the QWR and DVL.
      8. Delegation of the obligation to respond to a “servicer,” either real or apparent, is insufficient. There must be an answer from the designated “owner” — or the answer printed up under the name of SPS as “servicer” is unauthorized.
        1. That answer should be signed by an authorized officer or employee of the bank asserting ownership of an unpaid obligation due from Homeowner Smith and, if they so choose, that they have designated the “servicer” to answer questions more fully.
        2. But it should also include a copy of the collateral account or loan account, as it might be named. This is the sticking point when the homeowner wins.
          1. The reason is simple: there is no collateral account. There is only a faux collateral account presented as a Payment History for purposes of illegally obtaining profits and revenues from making false claims for restitution. There is no collateral account —- or at least not one owned by the designated “owner”– because everyone is ducking liability under Federal and State lending laws.
  7. The problem here for homeowners who are victims of fraudulent and fake claims is that they and their lawyers stop looking once they see the canceled check. As a result, the Judge is never presented with a contested issue about what goes on behind the iron curtain. But Homeowners know that they are being screwed and that their opponents are getting paid for nothing.

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PRACTICE NOTE: All payments of all types are now electronic. Virtually all money is electronic in the form of 1s and 0s on a computer server that is accessed through desktop applications. A paper check, therefore, is no longer different from any other payment, including but not limited to various names attached to payments:

  1. ACH
  2. Wire transfer
  3. Automatic deduction
  4. Zelle

The processing of all such payments is the same, with some small differences. Basically, every payment is initiated by the payor (the signor on what would be a check), which is then marked as received by the party who physically received the payment. If electronic, and there is no check,  the receiver is the party who is the owner of the account into which the deposit was posted. The rest is as above. tracing this is fairly easy once you force the opposition to comply with the statute and the rules of procedure. All payments involve the following entities:

  1. Issuing bank and account processor
  2. Intercept processor
  3. gateway processor
  4. Receiving bank and account processor

The Federal reserve bank is usually an intermediary/intercept/ processor also.

When attempting to put factual issues into dispute, you are looking for the actual “tracking” information as the payment is passed from one electronic source to another.

If an assignment says that it was executed in consideration of $10 and other valuable consideration, you want to know how the $10 was paid and what was the other consideration. If payments are alleged to have been made electronically, you now know what you are looking for —electronic interbank receipts issued by intercept, gateway, and account processors.

 

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Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

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Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. 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 14 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

Please visit www.lendinglies.com for more information.

Paatalo: If you don’t think judges will listen, think again

Skeptics often confront me to say that judges refuse to listen to their arguments.

My response is always the same.

But nobody likes the answer.

Judges will listen if you have something relevant to say, and you are saying it in proper form and in a timely manner. Both homeowners and lawyers fail to present appropriate arguments because they insist on admitting to the existence of a nonexistent debt. The rest is a “yes, but” defense that rarely produces anything other than frustration.

Bill Paatalo, a licensed private investigator and a long-time (14 years) contributor to foreclosure defense and forensic analysis has once again presented yet another example of what happens when a homeowner is willing to assume nothing and presents the argument.

Here is his blog article:

If You Don’t Think Judges Will Listen, Think Again

How to respond to idiotic non-responses received to QWR, DVL and CFPB complaint

People often say that using the QWR and DVL is useless because you don’t get any answers. But that is exactly my point. It is like pleading the 5th. In a civil proceeding, the refusal to answer raises any inference implied by the question asked. Whoever you are out there, stop trying to prove something.
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In our system of jurisprudence, you are not required to defend a claim unless it is claimed and there is evidence to support it.
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To make things easier on judges, lawyers, and litigants, there are shortcut rules that allow the court to assume certain facts to be true — not because they are uncontested but because the parties agree. Once they agree, it does not make any difference whether the agreed facts are true.
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So the moral of the story is to stay away from anything that adopts the position of your opposition — including the terms they use. If you admit that the payment history is a loan account, then you have just consented to foreclosure. It is not up to the judge to ferret out the real facts — that is what the litigation process is designed to generate.
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All claims are admitted if they are not disputed.

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The second level of litigation analysis after determining that a party has properly stated a claim that is recognizable by law is to challenge the opposition to corroborate the statement of claim.
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For example, the claim is that there is a present dispute that arises from the homeowner’s failure or refusal to make a scheduled payment to the named claimant. The homeowner who wins responds to that claim by challenging the truth of the matters asserted.
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In the example below, the claimant is US Bank. So the homeowner asks for corroboration that the homeowner owes US Bank. Since that information is not on the note, payable to someone else, US Bank must come forward with an assertion that it owns an obligation due from the homeowner, that it has been receiving payments, and that it is no longer receiving payments causing an economic loss.
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Most homeowners and their lawyers are afraid to ask this question because they are afraid of the potential answer. But in reality, this is your ticket to defeating the claim. There will be nothing from US Bank or any officer or employee of US Bank. Instead, every assertion will come from the mouth or pen of lawyer. The implied client of the lawyer is US Bank, but the lawyer never says that US Bank is his client because he has never had any contact with US Bank.
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The corroboration you are seeking is simple: show me the ledger where the unpaid account receivable is kept on the books of US Bank.
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If they can’t do that, then you are allowed to raise the inference that the unpaid loan account is not on the books of US Bank. At that point, the authority of the “servicer” vanishes along with all claims to administer, collect or enforce any payment that is stated to be due from the homeowner but not due to the named claimant. Case over. Homeowner wins for real in the real world in real courts.
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So I continue to strongly urge people to set up the bank (not just the servicer) for a complaint to the CFPB (to exhaust administrative remedies).
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This is followed by a civil lawsuit that specifically cites the lack of answer as a violation of the statutes and raises inferences favorable to the homeowner. The bank and “Servicer” should not be allowed to present a challenge to those allegations unless they provide the basic answers to the basic questions you asked.
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The response is always (100%) intentionally evasive and deceptive. The value of such a response si that most people don’t understand what they are reading and don’t know what they are looking for.
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The continued use of the SPS name is part of the deception. The company’s response merely repeats prior claims to being “the servicer,” without identifying any principal.
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The homeowner then claims that he/she cannot validate, confirm or corroborate the alleged debt without hearing from a party in interest who has paid for the alleged obligation, note or lien. As it turns out, most judges agree with his logic even if they believe that it is being employed to delay rather than win the case.
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But those same judges correctly conclude that they have no choice but to strike the pleadings or evidence proferred by the other side when the opposition refuses to comply with proper discovery demands. And it turns out that the inference is not just raised during litigation. It is also raised prelitigation when the opposition refuses to answer the same questions posed in statutory demand letters like a QWR or DVL.
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The judgment that you should be looking to obtain from the judge is simply that there is insufficient evidence to support the claim, and violation of the rules of procedure precludes the introduction of evidence in support of the claim. Your goal is not to get a judge to say that your opposition are thieves — even if they are thieves.
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The continued responses allegedly on behalf of SPS are all generated by automated computer programs without any accountability on the part of any company or person. SPS did not serve any of the responses and it does not serve the interests of any company or individual who owns any obligation due from me.
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To be clear, I wish to pay off this alleged obligation if it exists and I have the resources to do so. But I am not going to make any payment to any company or any individual who merely has information about my transaction. If I am to make a payment under the terms of the note, then I want to know who owns the obligation and who was the source of authority to enforce the note.
Despite numerous formal and informal requests, there is no basis or information supplied by anyone to support any foundation for asserting that authority to administer, collect or enforce was generated or authorized by an officer or employee of US Bank. US Bank disclaims any such ownership or authority. Yet it continues to be named as a claiming party. US Bank disclaims any responsibility for that decision and any responsibility for doing it. 
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There is no assertion by US Bank that it warrants title to a debt, note or lien. There is not even an assertion or information that an unpaid loan account exists anywhere in the ledgers of US Bank nor that an obligation owed by the homeowner is due to US Bank. In fact, there is no assertion that US Bank has ever received any payment from the homeowner nor that it intends to assert a claim for payment.
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Everything that has occurred here has been generated by third-party financial technology companies that have computers that read and respond to letters from homeowners based upon algorithms constructed and written by people who were not employed by any of the claiming parties or any company working for any of the disclosed parties.
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In the absence of any assertion of ownership and authority,  the homeowner demands that SPS and US Bank cease ad desist from making any claim to administer, collect or enforce any payment from me and that the CFPB take administrative action to stop them.
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This is a serious violation of statutes and a breach of the charter for the agency (CFPB and FTC).
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I suggest that this response be incorporated into a Qualified Written Request and Debt Validation Letter with instructions that only an authorized officer or employee answer the request and that the person be identified by name and contact information.
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Delegation of duties is at least partially illegal for a party named as trustee. You want to know whether US Bank ever and any right, title or interest in the payments scheduled to be paid by you. If not, it doesn’t matter what they delegated.
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If US Bank is merely allowing third parties to use its name while it performs no functions in connection with the accounting, processing or management of payments allegedly due from the homeowner, then it is neither acting as a Bank nor as trustee, and the CFPB should make a referral to the appropriate banking regulators for discipline related to their banking charter and licenses to do business.
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DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for Administrative Strategy ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
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CLICK HERE TO ORDER CASE ANALYSIS 
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. 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 14 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

Please visit www.lendinglies.com for more information.

The case for Continuing Education mandate for public officials

Even judges are sent to school before they take the bench. For the last few decades, every catastrophic economic event has been the direct result of the declining use of experts and the politicization of bare-bones facts. It was not malpractice tor repeal the Glass Steagall act or to waive the normal and customary rules governing the issuance of securities when it came to “derivatives” that were so broadly defined that it is difficult to imagine how any security is subject to SEC regulation.

The problem is that people employed by the executive branch, the legislative branch, and the judicial branch of government are making laws, rules, and doctrines and acting on them — all without an iota of knowledge of the subject. The only instruction they seek is how to vote, and they receive those instructions from the “establishment” — i.e., people with seniority and equal ignorance.

In fact, in many cases, the vote is cast by a congressman or senator without ever reading the proposed legislation If they read anything, it is a cheat sheet that was not prepared by the authors of the legislation or rule.

When Clinton signed that legislation in 1998 and 1999, he opened Pandora’s box — not just because he and all the legislators didn’t understand the potential consequences, but because none of them knew what Wall Street meant when they said they would issue derivatives as private contracts. It was pure nonsense. But that is what let the tigers out of the cage, and we are still recovering from the undermining of the foundation of our economy.

Undermining that recovery is the continuing practice of issuing “securities ” certificates that are not regulated under that waiver of existing law. And further undermining that recovery are the hundreds of thousands of foreclosures and judgments obtained by parties who have no legally recognized interest in any debt, note or lien.

We are the frog in the pot of water. The heat is turning up, and we won’t ever appreciate the damage we are causing ourselves because, by that time of reckoning, the economy will have reached the boiling point. Free market forces are not working, the “market” for derivatives is not free. If we want to get on sound footing again, we must take draconian steps to shut down the worst players and force others to play by the original rules that enabled this country to prosper.

The recent FTX scandal was the product of diminishing regulation and diminished understanding of the markets that serve as part of the foundation of this country. If lawyers and doctors and other professionals must continue their education and get training before they embark on some project, then so too should our public servants. And that should be at the expense of the government and not the private sector.

The difference between the debt and the note: the $20 trillion gift to securities brokerage firms on wall street.

Why would anyone allow the forced sale of a home to satisfy a claim for that remedy if the claimant had no right to receive any compensation or restitution from the homeowner?

The only real claim by any claimant in foreclosures today is that they possess the information and have built an infrastructure around it. But none of them own any debt, note or mortgage. Restitution for an unpaid debt has been set aside as an invalid point or irrelevant.

The answer from the courts is that because consumers signed a note, they owe money and their house to the claimant regardless of any entitlement to receive any money. The absence of a lender, successor lender or owner of the debt or note is now irrelevant in most courts.

In a mortgage transaction, the debt is the amount of money that the borrower agrees to pay back to the lender. The note is the legally binding document that outlines the terms and conditions of the loan, including the amount of the debt, the interest rate, the repayment schedule, and any fees or charges associated with the loan.

The debt is the principal amount borrowed, plus any interest and fees that are added to the loan over time. The note specifies the terms of the loan, including the interest rate, the repayment schedule, and any fees or charges associated with the loan.

The note also includes important information about the borrower’s rights and responsibilities, including the right to prepay the loan without penalty, the right to receive notice of any changes to the terms of the loan, and the obligation to make timely payments.

It is important for borrowers to carefully review the terms of the mortgage note before signing, as they are legally bound to the terms and conditions of the loan.

Prior to the structural evolution of syndication and other forms of joint lending to share risk, there was no practical difference between the debt and the note. A scenario in which there was any practical, legal or equitable difference between the debt and note was a very rare bird — usually because of errors in the documents.

Accordingly, most laws were drafted with that in that context — sometimes even defining the note as the debt or including the note within the definition of “debt.” This reminds me of the old expression coming from ancient Judeo-Christian law that “possession is 9/10s of the law.” That is all true, but what about the other 1/10th? And what happens when that last 1/10th is missing?

There is no doubt that the execution of a note creates the possibility of a liability that might be susceptible to enforcement just because the maker signed it. This is especially true in the scenario where a stranger (bona fide purchaser for value) pays for the note with something of value (i.e., legally recognized as value — i.e., money) in good faith and without knowledge of the maker’s defenses. This lifts the right of the purchaser to the status of a holder in due course — which specifically excludes most defenses by the maker, even if they are valid.

My observation back in 2006 was that nobody claimed that the designated claimant was a holder in due course. In reviewing more than 20,000 cases so far, I have not seen one case where there was an allegation backed by an affidavit or testimony or other documents corroborating the notion that the designated claimant was a holder in due course.

So my conclusion that continued for 16 years thus far is that the designated claimant if it exists, could have a status up to and including a holder but never a holder in due course. Thus all possible defenses of the maker apply. So what is a “holder?”

Under Chapter 3 of the UCC, which has been adopted verbatim in all U.S. jurisdictions as state law, a “holder” is one who (a) is in possession of the original note — or who has the right to possession (because they were the payor in a transaction relating to the homeowner or the seller) and (b) had been granted authority to enforce the terms of the note by the owner of the note either directly or indirectly through an authorized agent of the owner.

The two interesting parts are that the notes were customarily destroyed after “closing,” and there is never any evidence about the identity or existence of an owner who could legally grant the authority to enforce. The problem in the legal community is that they’re still thinking back to the time when debt=note. This error

That is not true anymore, and this one mistake has resulted in the loss of homes by millions of homeowners and the gift of trillions of dollars to companies with absolutely no financial interest or investment in the debt nor even possession or right to possession of the note. And they, indeed, never received authority to enforce the note from an owner whose grant of authority was legally enforceable.

Foreclosure is a legal process in which a lender attempts to recover the balance of a loan from a borrower who has defaulted on their mortgage payments. If the borrower is unable to bring their mortgage payments current and the lender is unable to reach a mutually satisfactory resolution, the lender may seek a foreclosure judgment from the court.

If a disinterested party has a valid legal claim to the property, they may be able to intervene in the foreclosure process and seek a foreclosure judgment in their own right. This could occur, for example, if the disinterested party holds a lien on the property or has a contract with the borrower that gives them an ownership interest in the property.

In order to get a foreclosure judgment, the disinterested party would need to file a lawsuit against the borrower and prove their legal claim to the property. If the court determines that the disinterested party has a valid claim and that the borrower has defaulted on their mortgage obligations, the court may issue a foreclosure judgment, which would allow the disinterested party to take possession of the property.

None of these conditions are ever met. Instead, a series of faux law firms with faux clients make unfounded claims based on fabricated, false, forged, and backdated documents of transfer.

If you go to any law professor, they will tell you that foreclosure must be a remedy to satisfy an underlying obligation owed to the party designated as the claimant. If the claimant has no such claim or does not exist, then there is no justiciable issue, and the court lacks jurisdiction.

But if you ask any judge the same question you will get a different answer that is not only erroneous it is a breach of basic constitutional principles, common law principles, and good sense. Why would anyone allow the forced sale of a home to satisfy claim for that remedy if the claimant had no right to receive any compensation or restitution from the homeowner?

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Documents of transfer do not convey any greater rights than existed in the grantor of such documents, but transfer documents (assignments, endorsements, powers of attorney etc.) are now treated as “evidence” of such rights. They are not.

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Under the laws of evidence, such transfer documents have been excluded as hearsay and have never have been evidence of the underlying right or obligation. This doctrinal law, solidified by statutes, existed for centuries and still exists despite the constant error in the courts of assuming the law is otherwise or that the court’s discretion is broad enough to make new law — a fundamental breach of separation f powers codified in our U.S. Constitution.

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The error by the courts has been committed almost universally. And the judges who were not willing to go along with the myth were displaced, put out to pasture or have died. Trillions of dollars in wealth was transferred with the sales of fake MBS certificates and trillions more was transferred with the sale of homes wherein the homeowner received nothing.
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The only real claim by any claimant in foreclosures today is that they possess the information and have built an infrastructure around it. But none of them own any debt, note or mortgage. Restitution for an unpaid debt has been set aside as an invalid point or irrelevant.
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PRACTICE NOTE: while it is certainly not advisable to bring this up as the tip of your spear and litigation, it is helpful to keep in mind, a simple fact about the alleged existence of a loan contract. If a loan contract had existed, it would have been because a consumer purchased a loan account from a lender.
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If you ask any banker or bank lawyer about this, they will confirm what I just said. It sounds counterintuitive because people do not understand the process of banking.
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DO NOT ACCEPT THE “PAYMENT HSIOTRY.” This is essentially why the litigator must be relentless and demanding to see a ledger that shows a list purchased by the consumer. Without that loan account, there can be no debits, no credits, and, most importantly, no default, no matter how many people declare a default.
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And it goes without saying that there is no injury without a default. Also, without a loss, there can be no default or injury. The challenge for litigators is to avoid challenging the creation of the loan account and simply focus on whether it currently exists.
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While this is certainly circular reasoning or tactics, it works. Judges are willing to rule in favor of the homeowner based on current circumstances but unwilling to go back and nullify the initial transaction even if the initial transaction was a legal nullity. It is like the imagery disconnect between guns and gun violence. It makes no sense, but if you ignore its existence, you do so at your peril.
*

If you think these pages contain theories and not facts, read the websites of the parties named as “trustees” of “securitized” trusts for “securitized” mortgages

This is a zero-sum game, but not in a good way. There is nothing on the side of the grantor and there is nothing on the side of the grantee. The trust, trustee, and servicer have nothing. And the attorney has not heard from or been hired by any of them.

Start with the supposition that all assertions or implications of assertions you are receiving from “servicers” or lawyers who say they present a trust or trustee are all lies. If you do that, you are far more likely to win  the case than to admit that there is a loan and that it is enforceable because the “loan account” is owned by some trust or trustee and is being “serviced” by some “servicer.”

It is all fact, but as Alejandro Reyes, VP of Deutsch asset management said in a recorded interview, it is all very “counterintuitive.” Think about that word he used. It means that whatever you think you know is wrong.

Start with the supposition that all assertions or implications of assertions you are receiving from “servicers” or lawyers who say they present a trust or trustee are all lies. If you do that, you are far more likely to win  the case than to admit that there is a loan and that it is enforceable because the “loan account” is owned by some trust or trustee and is being “serviced” by some “servicer.”

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I have several comments
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The statement that services are required to initiate foreclosure in the name of a trust or trustee “as the legal title holder of the mortgage,” is extremely revealing. First of all, it appears to be an intentional missed statement of the law. In fact, in most instances, all efforts in the name of any company that was designated as a “servicer” have been rejected by the courts.
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Second, that statement constitutes an admission against interest. It is admitting that the trust or trustee that is named in connection with the initiation of foreclosure proceedings has been named as the assignee of title to the mortgage lien without any further interest.
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American law requires that all foreclosures and all enforcement actions with respect to security instruments must be conducted on behalf of an interested party, who can demonstrate both the alleged breach and a loss arising from that breach. So the statement can only be interpreted as meaning, that the trust or trustee is serving in a representative capacity and not as a principal. Since it is not a principal, it can’t possibly be appointing any agents, especially any company designated as an “servicer.”
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This is corroborated by the next sentence, which states that the trustees role is limited in scope to holding nominal legal title. The statement that the mortgages are securitized is false, unless the underlying obligation was sold to investors. The players’ attempt is to preserve their incoming fees by making reference to securitization of “mortgages.”
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But there never is a direct statement that any obligation, debt, note or mortgage was ever sold to any investor in whole or in part. An examination of the securitization documents in virtually every case reveals that investors did not purchase any financial interest in any payment, obligation, note, debt, or mortgage.
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Quite the reverse, the intention of the parties is clearly to protect investors from being characterized as lenders, and therefore liable under federal and state lending laws. Accordingly, the reference to the mortgage is being securitize is completely false, and it is difficult to imagine any scenario in which a sophisticated entity like US Bank would not know that.
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Any reasonable analysis would result in the conclusion that the lawyers, the company designated as the current, or past “servicer,” the trust, the trustee and any related parties are all acting in a representative capacity for an undisclosed principle. The undisclosed principal is an investment bank, whose sole objective is the sale and trading of securities. The fact that securities were issued and sold does not mean that those securities conveyed any ownership interest in any transaction that was ever conducted with the homeowner.
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Their statement further corroborates this analysis that any believe that US bank initiates or manages the foreclosure process is mistaken. This admission means it has delegated functions exclusive to a functioning trustee to unnamed third parties. It also falsely implies that US Bank has any right, title, or interest in any transaction with any homeowner that would give rise to the grant of any functions relating to administration, collection, or enforcement of a financial interest, or right that is neither owned nor controlled by US Bank.
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They are right that the securitization of mortgage loans began in the 1970s. In fact, it began earlier than that, and I was there when it happened. I was at the meetings when the seeds of the current crisis were planted. But in the beginning, mortgage loans were actually securitized.
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At the beginning, both individual loans and packages of loans were sold to investors in prorated shares. Thus they satisfied the basic definition of the securitization of any asset. It was only later, that strategists later rose to prominence on Wall Street, realized with the help of some attorneys located in Chicago that they could claim that the mortgages were securitized, even if nothing was sold.
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You will often get a “letter” that “explains the situation. This letter is sent out by a robot. It is never signed nor is there any human being who is named as a contact person. This violates federal and state law. The letterhead is fabricated and often seen as unevenly placed by manual or electronic means.
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The letter corroborates the above analysis. It purports to assert that the letter is from US Bank. A close examination of even a copy, indicates quite strongly that this letter was neither generated nor executed by anyone from US Bank, nor was it authorized by anyone in US Bank. But even if US Bank authorized it, it purports to grant a trustee’s powers to a company that has been falsely designated as a “servicer.”
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This is a zero-sum game, but not in a good way. There is nothing on the side of the grantor and there is nothing on the side of the grantee. The trust, trustee, and servicer have nothing. And the attorney has not heard from or been hired by any of them.
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In all US jurisdictions, the powers of a trustee to manage the affairs of a trust containing relevant assets are not capable of delegation. That function is not a commodity that can be transferred or sold. The admission that Rushmore makes all such decisions is an admission that either trust the powers have been delegated illegally or that it doesn’t make any difference because the alleged “trustee” (US Bank) doesn’t own the asset anyway.
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But not even that admission is true. If Rushmore is not performing any functions that are normally attributed to that of a loan servicer, then Rushmore is not making the decisions either. And in fact, that is precisely the case. The decisions are being made by an investment banker.
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And again, I note that the alleged letter is unsigned and without any reference to any human responsible for the authorization, execution or sending of the letter. My guess is that if you were able to secure the services of an IT professional, you would trace the email address to someplace other than US Bank, or it is automatically being forwarded to a financial technology company whose AI technology reads and responds to correspondence.
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PRACTICE HINT: WAKE UP!!! This is a huge opportunity for lawyers to make more money than they could make doing anything else.
================
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Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting 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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for Administrative Strategy ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. 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 14 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

Please visit www.lendinglies.com for more information.

 

 

Don’t allow judicial notice to be an end run around the rules of evidence

One of the tricks played by lawyers who work for foreclosure mills is to use a motion for the court to take judicial notice of a certain document. While it is usually technically construed only as the document exists, it is practically construed as a memorialization of true facts.

Mohanna v. Wilmington Sav. Fund Soc’y FSB, 4:21-cv-03557-KAW, at *1 (N.D. Cal. Dec. 13, 2021) (“Request for Judicial Notice As a general rule, a district court may not consider any material beyond the pleadings in ruling on a motion to dismiss for failure to state a claim. Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001). A district court may take notice of facts not subject to reasonable dispute that are “capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” Fed.R.Evid. 201(b)United States v. Bernal-Obeso, 989 F.2d 331, 333 (9th Cir. 1993). “[A] court may take judicial notice of ‘matters of public record, ‘” Lee250 F.3d at 689 (citing Mack v. S. Bay Beer Distrib.798 F.2d 1279, 1282 (9th Cir. 1986)), and may also consider “documents whose contents are alleged in a complaint and whose authenticity no party questions, but which are not physically attached to the pleading” without converting a motion to dismiss under Rule 12(b)(6) into a motion for summary judgment. Branch v. Tunnell14 F.3d 449, 454 (9th Cir. 1994), overruled on other grounds by Galbraith v. Cnty. of Santa Clara307 F.3d 1119 (9th Cir. 2002). The court need not accept as true allegations that contradict facts which may be judicially noticed. See Mullis v. United States Bankruptcy Ct.828 F.2d 1385, 1388 (9th Cir. 1987).”)

In particular, note the language “facts not subject to reasonable dispute that are “capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” Foreclosure mills love to play with this using the SEC.gov website because nobody understands the rules except securities lawyers.

Everything asserted in every document is hearsay. That means it is not admissible evidence. It is simply potential information like what you might retrieve in the process of making discovery demands and receiving responses.

But lawyers for the foreclosure mills will often receive documents via electronic transmission from an unknown source. Some documents contain a header at the top of the page that identifies the source of the document as a folder on sec.gov. That part is not a lie. It is a copy of a document that was downloaded from that website. But now you need to know the rest of the story.

When the lawyer for the foreclosure mill introduces the document as a government document, as though the documents and its contents are not in dispute, he is perpetuating a lie even if he or she does not know it. In a process known as “shelf registration,”

It gives the filer access to UPLOAD documents on the sec.gov website. But a shelf registration is not reviewed or approved by the SEC because no securities were offered and sold. That is the definition of shelf registration.

So first, if the document asserts or implies the existence of an unpaid debt due from the homeowner as being owned as an asset of the “issuer” named in the shelf registration, then that is an assertion of the persons who uploaded the document. It is not an assertion of the filer, the issuer, or the SEC. And it is not filed under penalty of perjury or anything else.

So “judicial notice” in this context means that the banks have found a way to use the shelf registration rules to gain access to sec.gov to upload their own fabricated documents solely so they can download them from the sec.gov website with the sec.gov header. This successfully misleads and misdirects the homeowner, the lawyer for the homeowner, and the judge.

The defense consists of an objection to the lack of foundation and proof of authenticity and accuracy of the document. This is often the case with a “pooling and Servicing Agreement” this is usually incomplete, unsigned, and framed for future reference, not past events or events that are asserted to be happening with and by virtue of the execution of the PSA.

The only foundation for any document is the testimony of a live witness who swears under oath that the document is authentic, that it is the original (not a copy, unless the parties have agreed to accept copies) and that the witness is the author or the authorized person as custodian of documents for the party or parties named therein.

Homeowners who object to the lack of foundation usually win. Homeowners who know nothing about this usually lose. 98.5% of all homeowners threatened with foreclosure fail to challenge anything. Under our system, anyone can claim anything until someone opposes the claim. If nobody opposes the claim, it becomes true, and judgment is entered, making it legally true for all purposes.

=============

DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort, please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting 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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for Administrative Strategy ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
CLICK HERE TO ORDER CASE ANALYSIS 
*

FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. 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 14 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

Please visit www.lendinglies.com for more information.

Wells Fargo Banking license should be revoked.

For a Bank, simply being fined with an order to pay money is ridiculous as a substitute for the required discipline.

With a long history of severe discipline from multiple genciesx, Wells Fargo bank is a repeate offender as the current CFPB director has said. It has lost its right to do business in the American Marketplace. If not, the government is literally inviting more violations of greater and greater significance — like the mortgage meltdown in 2008.

In the Wall Street Journal and other publications, we see that Wells Fargo Bank is going to pay a large fine for faking, lying and even creating the illusion of customers in order to push up the trading price of their common stock.

Wells Fargo bank is not some toddler that should be told not to do that again because it is bad. It knows it is bad, and it did it anyway. Paying a fine is merely the cost of doing business. The Bank should be eliminated from the marketplace — just like any single person would be if they committed such clear violations of statutes, common law, and common sense.

Banks are entities that are licensed to do business as depository and lending institutions. If a lawyer did what they did, the license would be gone, and the lawyer would be in prison. If the lawyer only faced the prospect of paying a fine, it might still be worth committing the violation.

Wells Fargo faked the creation and maintenance of accounts, fees, collections and its own status in thousands of foreclosures. In foreclosures, it kept saying it was a lender until it said that it wasn’t a lender. That is when they admit that they are acting as a servicer. But the fact that they’re collecting money doesn’t make them a servicer unless they are doing it for a creditor.

These CFPB settlements are basically publicity stunts for the agency without doing anything for consumers. So the name Consumer Financial Protection Board is turning out to be a sham. That is not the way Elizabeth Warren and other Democrats conceived of it. But Republicans, paid by Wall Street, have kneecapped this agency at every turn. It cannot now fulfill the purpose envisioned when it was created.

That is politics, and without competing interests, there is no energy in a free-flowing democratic republic. I get that. But unless we take private money out of the equation  of electoral politics, consumers will continue to be treated and evolve into what Karl Marx referred to as the “proletariat.”

Free markets mean, by definition, that the participants in the market are free to make their own decisions. And free markets require government regulation to force players to follow the rules set by society for fair play. Today, no consumer gets the information needed t make those decisions and cannot defend against false claims.

The concept of equality under the law is being ignored. A lawyer or any other licensed professional loses their license and risks imprisonment for performing the same deceitful acts that Wells Fargo (and other banks) have been doing for  many years. For a Bank, simply being fined with an order to pay money is ridiculous as a substitute for the required discipline.

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The problem with all these “settlements” is that while there is an assertion that repos and foreclosures were done unjustly and illegally, nobody ever gets their car or house back. Once upon a time this was a no-brainer. If a chain of tile was based on a fraudulent void document, all the succeeding transaction documents were also removed from the chain of title. Now the banks have agencies as their intermediary. They settle with the agency and some former car owner or homeowner gets a check for $179 in exchange for gifting property worth tens or hundreds of thousands of dollars to the offender.

Bloomberg: Inside Wall Street’s $1 Trillion Decade

It sounds like a lot of money, and it is. But it is dwarfed by the sums of money generated by their false claims of debt securitization. This is the start of reporting on how Wall Street converted investor money to their own money and how they converted everyone else’s money to theirs.

Just remember, this is what Wall Street admits. It is NOT an accounting for all the money they grabbed illicitly using the credit markets as a vehicle for theft.

Inside Wall Street’s $1 Trillion Decade

https://www.bloomberg.com/news/newsletters/2022-12-27/big-take-how-big-us-banks-made-1-trillion-this-decade

 

No Ledger, No Claim

 Even if a consumer thinks they owe a debt, it is still up to the lawyer who initiates the collection or foreclosure action to prove that they have a client that owns the debt, has the right to file suit, and has enough documentation to prove a debt is owed. They may not be able to successfully produce all required documentation when challenged. When that happens, the judge has no chioce but to deny the claim — even if it was based on a real loss. 

No agent has any power or rights unless it is serving the interests of a principal who legally owns and possesses such rights.

No money is in the bank unless the check register and the bank account demonstrate the existence of the money on deposit.

No collateral account (unpaid loan account due from the homeowner) exists unless the accounting ledger of the creditor and supporting documents show a purchase of the unpaid obligation.

Homeowners need to stop being afraid to ask the right questions. They are not asking the right questions because they are afraid of the answers. There is no answer because there is no claim. Under the laws of due process if they can’t answer they can’t claim. You don’t need to prove anything to win.

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In recent correspondence with readers and clients, it has become abundantly clear that my assumptions about people having a basic understanding of accounting concepts are wrong. I apologize.

*

This became highlighted when someone sent me a quote saying that one company that somebody had designated had released its “servicing rights” to yet another company designated, possibly by someone else. It was a meaningless sentence, and under the law, the homeowner is not required to give it any weight.

*

If anyone relies on that document to pursue claims for the administration, collection or enforcement of money allegedly due from the homeowner, they do not possess a valid legal claim. And the point here is not to prove the nonexistence of a claim but rather only to prevent the lawyers from putting on a case. The defendant should not care how he or she wins as long as what they do is legal.

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Agents do not spring into existence except under one circumstance: a principal party who can affirm and warrant title to the rights affected has appointed that agent to act under the circumstances described in specific documents that contain specific powers and restrictions. 

*

The only thing homeowners and their lawyers get are unfounded, self-serving fabricated documents that pretend that the principal has already been involved without any precise definition or identification of the principal. So they receive letters saying that the letters come from the “servicer” (which is untrue) and that the “new servicer” is now servicing the “account.” That is also untrue.

But homeowners and their lawyers are afraid to ask standard open discovery questions because they are afraid of the answer. The only valid answer is that the creditor hereby affirms and warrants title to the underlying obligation, debt, note, and mortgage lien. As such, it appoints a specific agent to act as servicer for administration, collection, and/or enforcement of a loan account that it owns and which is shown on its ledger the same way the ledger was always produced in foreclosures before the era of securitization claims. 

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The problem with these statements that emanate from unknown sources on behalf of entities that may legally exist but are not creditors is that they are the equivalent of saying that if you hire an employee, someone else can take that employee’s place without your knowledge or consent. It simply does not work that way.

*

Agents do not appoint themselves or create powers for themselves. That is ALL (no exceptions) done by the principal for whom they are acting. Any company claimed to be a “servicer” or who has allegedly participated in a transaction regarding servicing a collateral account (unpaid loan account on the ledger of a creditor) MUST be acting on the express authorization of that creditor.

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By the way, I have encountered a staggering level of ignorance about the most basic accounting and bookkeeping concepts. Wall Street has successfully weaponized that ignorance. People ask me to define the ledger. When I used the check register he or she used to write personal checks, they got it. But before that they had no idea.
*
Let’s go back to basics. You either have money in the bank or you don’t. Your check register is the ledger, even if you don’t reconcile it. Suppose it needs to be brought up to date by someone who performs the reconciliation of checks outstanding, deposits outstanding, deposits made, and checks that cleared. In that case, the check register is still the register (ledger). The ledger/register is conformed or corroborated by what the depository bank, as a third party entity, reported it is maintaining as a record of your balance. But only you know what deposits were made and what checks were written that have not yet been negotiated or posted.
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If you issue a “statement” or “notice” saying that you have $100 in your bank account, that is an assertion or allegation. It is not evidence of anything other than that you said it. The ONLY way to know if that $100 is in your bank account is by (a) looking at your check register and (b) looking at the bank records produced by the bank.
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And THAT is what I am talking about. Perhaps I have not previously made myself clear because I assumed that most people possess a rudimentary knowledge of basic accounting concepts since most have bank accounts.
*
So when a lawyer says that a company is a “servicer” that does not make the company a servicer, agent or authorized to act on behalf of anyone. It is an assertion or allegation. Sometimes it is only implied. You will note that no assertion is ever made that the party named as the claimant in a foreclosure is a holder in due course. That would require a purchase for value in good faith and without knowledge of the maker’s defenses (i.e., the homeowner’s defenses). Nobody EVER says that because no check register (ledger) shows that any company owns a “loan” account. This is the exact equivalent of not really having the $100 in your checking account.
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So the ledger is the key. If you don’t have a bank account, or if you don’t have any money, there is no assertion or allegation or fabricated document in the world that will put that money in there. The assertion is untrue if your check register doesn’t show the money and your bank doesn’t show the money. And that is why we conduct discovery to challenge the basic premises of foreclosure claims. Most of the homeowners who follow this strategy win their cases. It is rare that anyone wins for any other reason.
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The reason why most people fail to follow this strategy is that they are afraid of the answer. They think that someone will come forward with a ledger that can be confirmed as to its authenticity and accuracy, thus demonstrating that the ledger, the creditor, and the claim are all valid. So they blindly fail to object to the substitution of a fabricated payment history instead of actually seeing the ledger of the alleged creditor, and they fail to challenge the existence of a creditor, unpaid loan account due from the homeowner, and the current claim.
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PRACTICE HINT: You don’t need me as an expert for this. Ask any CPA.
=============
DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting 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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for Administrative Strategy ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
*
CLICK HERE TO ORDER CASE ANALYSIS 
*

FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. 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 14 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

Please visit www.lendinglies.com for more information.

The money trail does not lie. But the documentary trail lies all the time.

It is not a business record unless it is a record of the business conducted by the company that is the source of the report. (No exceptions). 

If it is not a business record then it is hearsay. Hearsay is not admissible evidence. 

Stop thinking about whether you owe the money and start thinking about whether you can stop the lawyers from proving any claim. In most cases, you can stop them dead in their tracks. The reason is that there is no claim — but you don’t need to prove that.

There is an old expression about how figures don’t lie, but liars figure. This has probably always been true since the first day humans began counting. Somehow, it always comes as a surprise when people eventually learn about lies coming from a source whom they knew was not credible. I guess that is a matter of psychology rather than finance or law.

One of the most difficult concepts for the average person to understand is that under our current banking and financial system, it is possible to legally divert money that was paid to the order of a person or company known to the maker of the instrument or the originator of the electronic funds transfer. It is also legal to divert that money to a person or company unknown to the instrument’s maker or the originator of the Electronic Funds Transfer.

In plain language, I’m talking about homeowners making assumptions when they write a check. When they write a check paid to the order of, for example, Ocwen Loan Servicing, they are making the assumption that Ocwen is at least initially receiving the money. In other words, they assume that the check is being deposited into a depository account owned and maintained by Ocwen.

This is virtually never the case. The check is being received by a lockbox vendor unrelated to Ocwen. Ocwen has agreed to the use of its name in this transactions scheme in exchange for receiving a fee or royalty. Ocwen is a classic sham entity dressed up to look like a company that receives and disburses money paid by homeowners. And when the scheme blows up it will be Ocwen who is thrown under the bus, which is why on other pages here, I have said that Ocwen is a stupid investment.

Ocwen has no right, power, title, or interest in those payments by the homeowner and if it even tried to touch that money it would lose all its fees and go out of business. It owns no obligations, promises, debts, notes or mortgages.

The lockbox vendor has no greater right to touch the money than Ocwen. This vendor either runs automated equipment or sends the checks to another company that runs automated equipment to sort checks. In this context, that means reading the content of the checks, and automatically posting them based on algorithms devised by other companies, acting as vendors.

The posting of this data is strictly on servers owned and maintained by companies with no right, title, or interest to any of the payments. This is not the account ledger of some creditors. But the appearance and the presumption strongly imply that all of these functions are being performed under the management of Ocwen, which has absolutely no information or corroboration of any of the data or any report generated from the data.

But we have not even gotten to the point where the checks are deposited anywhere. If you think that the checks are deposited into an account owned, operated, and managed by Ocwen, you are wrong. This erroneous conclusion will lead you to an additional conclusion: the proper source for a report on the data relating to the receipt and distribution of funds is Ocwen. But anyone who has ever asked Ocwen to produce the accounting ledger of the creditor on whose behalf the lawyers are saying Ocwren is serving knows that they have never seen, nor will they ever see, any distributions to creditors.

Despite the obvious logic to anyone like me who has expertise in the field of accounting, auditing and financial analysis, very few people have asked a very simple question: why can’t Ocwen report the distributions to creditors if they are acting as a “servicer?” And the answer is because Ocwen has no idea who actually is in possession of the money, nor any idea as to the ultimate destination of the money derived from payments received from homeowners. In other words, Ocwen is NOT a servicer.

That is why the Robo witness from Ocwen is never an employee with personal knowledge or experience in connection with the receipt, deposit or distribution of money.

This can often be seen if you are able to secure a copy of a negotiated check, which shows the endorsement of a payment made by a homeowner.

The endorsement clearly shows what I have been talking about for years. Deposits are made into a clearing account that is not owned, or managed by the depository institution, except as the recipient of the money, temporarily. The money is being deposited into a clearing account managed by third parties using an intermediary clearing corporation.

The money then goes to parties who are completely unknown to the homeowner or consumer. They are unknown to the consumer because they are not entitled to the money. But they are getting it anyway. And the parties designated in writing to be the alleged claimant get nothing except fees for the use of their name.

PRACTICE HINT: Nearly everyone (courts, lawyers, judges, lawmakers, and law enforcement) assumes that a report offered as a “business record” is cloaked with a presumption that it is a “Business record” and therefore admissible into evidence even though it is hearsay (and hearsay is normally excluded from the evidence that is admitted into the court record). Evidence not admitted into the court may not under any circumstances be used as the foundation for any ruling or decision by a judge. 

It is not a business record unless it is a record of the business conducted by the company that is the source of the report. 

All this is true and corroborated because Wall Street is conducting an illegal business that looks legal. The divergence of the money trail from the paper (documentary) trail is nearly impossible for the average person to understand. We are so conditioned to believe what we read that the idea of falsehood is automatically resisted. 

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Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
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Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. 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 14 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

Please visit www.lendinglies.com for more information.

What about that escrow account?

under Federal and State law, it is up to the Lender to tell the truth, i.e., that it is the lender and that it is creating a loan account that can be reviewed by the borrower. BUT the choice of the terms “lender” and “borrower” is a representation that has been almost universally untrue.

Without the truth of the matters asserted or implied, there is no transaction and there are no claims based on the transaction. 

But what consumers need to know is that anyone can make any claim, even if it is false. If you don’t defend it, it becomes true in court. If you repeat it, it becomes doubly true, even though it is still false.

Using the terms proffered by the actors and players in securitization and foreclosures is tantamount to an admission of liability for a debt that does not exist. It is not up to the court to ask wherh you meant it or not. Think about that the next time you want to say “my loan.”

As I have repeatedly reported on these pages, the actors and players in the securitization scheme, and the foreclosure scheme have been successfully utilizing fake labels to mislead people into assuming things that are not there, or are not true.

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The use of the word “escrow account” is another way that the banks deflect people from making further inquiries. It is perfectly natural and human to make assumptions based on that assertion. But when you think about it, you will see that the use of that phrase does not convey any useful information.

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The supposed escrow account may or may not exist. If it does exist, there is no way to know the terms of the escrow. In other words,
  • what agreement sets forth the duties of the escrow agent, if an escrow agent has been identified?
  • How does money get into the escrow account,
  • how does money get out of the escrow account
  • on whose instructions or funds distributed from the escrow account?

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Asking such questions is a way of flushing out the parties who are the “real players.” Keep in mind that when it comes to transactions with homeowners, the only real players are the ones in control. Do not assume that the players or actors who are controlling the flow of money or the flow of documents are the owners of the money or the documents.

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Someone recently suggested to me that the reason why homeowners are so willing to believe what is patently unbelievable is that they don’t want to admit the mistake they made when they entered into a securities transaction instead of a loan transaction.

My answer is that no mistake was made.

Homeowners are not generally possessed of education licensing , or experience in the creation, issuance, sale and trading of securities. There is no requirement that they should be so endowed. In fact, the Federal Truth in Lending Act (TILA) specifically assumes that property owners do NOT know the intricacies of the transactions that they are signing on for.

So do the securities acts, regulations, and rules. It is up to the “lenders” (not “borrowers”) to determine the viability of the transaction, the accuracy and reliability of the appraisal, and the ability of the homeowner to meet the terms of any proposed loan. The “lender” is also required to disclose all possible compensation or revenue arising from the transaction.

And most of all, under Federal and State law, it is up to the Lender to tell the truth, i.e., that it is the lender and that it is creating a loan account that can be reviewed by the borrower. BUT the choice of the terms “lender” and “borrower” is a representation that has been almost universally untrue.

Homeowners were intentionally deceived by false pretenses regarding the transaction’s nature and the transaction’s outcome.

Despite strict requirements set forth in the Federal Truth in Lending Act regarding revenue, compensation, fees, commissions, and other expenses, nothing was disclosed with respect to the revenue generated from the sale of securities.

That sale of securities, contrary to what you read in mainstream media, was not a sale of any promises made by any homeowner nor any portfolio consisting of any debts, obligations, notes, or mortgages.

That sale to investors was and always has been defined strictly as a loan transaction between an investment bank and the investors. Those investors were not beneficiaries of any trust, nor does any trustee have any authority to represent the interest of the investors, who hold the virtually worthless certificates that they purchased.

===============

DID YOU LIKE THIS ARTICLE?
Nobody paid me to write this. I am self-funded, supported only by donations. My mission is to stop foreclosures and other collection efforts against homeowners and consumers without proof of loss. If you want to support this effort please click on this link and donate as much as you feel you can afford.

Please Donate to Support Neil Garfield’s Efforts to Stop Foreclosure Fraud.
CLICK TO DONATE

Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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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. You will receive an email response from Mr. Garfield  usually within 24 hours. In  the meanwhile you can order any of the following:

Click Here for Preliminary Document Review (PDR) [Basic, Plus, Premium) includes 30 minute recorded CONSULT). Includes title search under PDR Plus and PDR Premium.

Click here for Administrative Strategy ANALYSIS AND NARRATIVE. This could be all you need to preserve your objections and defenses to administration, collection or enforcement of your obligation. Suggestions for discovery demands are included.
*
CLICK HERE TO ORDER CONSULT (not necessary if you order PDR)
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CLICK HERE TO ORDER CASE ANALYSIS 
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. 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 14 years or more. In addition, although currently rare, it can also result in your homestead being free and clear of any mortgage lien that you contested. (No Guarantee).

Yes you DO need a lawyer.
If you wish to retain me as a legal consultant please write to me at neilfgarfield@hotmail.com.

Please visit www.lendinglies.com for more information.

Where did the banks hide trillions in illicit profits?

Many people and even judges have dismissed my work summarily as the ravings of a merry band of conspiracy theorists. None more so than my “claim” that the banks are hiding somewhere around $10 trillion parked offshore in a variety of sophisticated investments — like the Goldman Sachs purchase of a facility that stores precious metals.

Within that facility, exchanges of ownership happen that are never reported. Nobody knows what is in it because Goldman does not need to report the contents of the facility. And since it is offshore, it is not governed by U.S. laws, and since it is regarded as a storage unit, very few laws apply to any part of the operation.

To be clear, this is not a “claim,” and it is not based on theory. It is based on reporting from credible media sources all over the world. It is true, and Goldman Sachs has not denied it. It has merely said that where it invests money or what it does offshore is none of our business. But control of the precious metals markets does not account for trillions of dollars that were pocketed in converting the wealth of millions of homeowners into the wealth of Goldman Sachs, Citi, and Chase. No taxes were paid because the cash flow was never reported on any accounting statement, much less a tax return.

This also is not a claim. In a test of this premise, the State of Arizona confirmed that more than $3 billion was owed in income taxes and fees for transferring interests (generating revenues and profits) that were never reported. When the judicial committee of the state house of representatives approached me in 2008 to devise a solution, I did that, and it was fully vetted through all levels of the Arizona state government. We were about to implement the plan when John McCain stepped in, and the plan went dark — followed by a settlement that wiped out the $3 billion deficit in the state budget caused by the fake securitization scheme.

I lost my own parking spot in the legislators’ parking lot. The Plan was dubbed AMGAR — Arizona Mortgage Guarantee and Resolution. It is a fact, not theory.

I have since tried unsuccessfully to get investors willing to establish their own companies that would offer the money to pay off all that is demanded on residential transactions — with the condition that the designated creditor makes the usual assurances that it owns the unpaid loan account and appoints XYZ as a servicer entitled to receive money on behalf of the creditor. Upon failure to do so, the homeowner would then owe a fraction of the amount demanded to the investors, and the investors would have lost virtually nothing.

So it should be no surprise that the bulk of the illicit gains from the “mortgage” and the separate “foreclosure” fraud is parked in plain sight for those who understand foreign exchange. That includes virtually nobody. FOREX occurs. That is much we have known for centuries. How it occurs is entirely another story. Most of it is not governed by any rules. It is primarily based on the whims of participants.

Since the major investment banks had devised a plan to take the bottom out of the US economy using fake instruments, it is only fitting that they now choose to hide their illicit gains in fake or at least convoluted instruments based upon FOREX. And for the first time, the Wall Street Journal has confirmed the issue and quantified it in much the same terms as I have been doing for years- tens of trillions of dollars are hidden within that system.

Suppose anyone is seriously interested in balancing the national budget. In that case, they should start with clawing back illegal, unreported transactions that were categorized as “off-balance sheet” in order to hide the activities that most likely would have been prosecuted as civil and criminal violations.

see “A New Financial Threat Emerges” WSJ Opinion

https://wallstreetjournal-ny.newsmemory.com/?publink=2d4473020_134873e

 

Those lawyers in foreclosure do not directly represent any client

From what I have deduced from the information that has been reported, together with private conversations with attorneys from the Darkside, it appears that the structure or infrastructure that produces legal services for the origination and foreclosure of transactions with homeowners is as complex and ornate as anything else in the securitization infrastructure.

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The foreclosure mill appears to be at the same level, as the company designated as the “servicer.” And basically, there’s no authority to make any decisions regarding anything about litigation or settlement.
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The initial instructions arrive on a computer screen from an unknown source that the foreclosure mill has agreed to follow exactly.
  • No lawyer in the foreclosure Mill has ever had any contact with the implied “client.”
  • No lawyer in the foreclosure Mill has ever had any opportunity to review or analyze any document or supporting evidence for the claim that they have been instructed to file.
  • No lawyer in the foreclosure Mill has any idea whether the claim is true or not. But they have received information instructions that IMPLY the existence of a claim and the authority of the lawyer to present it in court.
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The instructions come from a regional law firm whose sole function is to act as an intercept to pass on information and instructions. They receive instructions in the same manner as the foreclosure mill. They have no way of knowing the identity of the “Client” or whether the “Client” owns or has authorized the enforcement of a claim. And they don’t care.
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Then you come to the muddy level of “in-house counsel.” This might be an attorney, and it might not be an attorney. The attorney might be employed by an intermediary for an investment bank, or he or she might be employed by yet another law firm that is acting as “in-house counsel.” This lawyer, and probably all of the other lawyers, follow exactly the instructions and provisions of a foreclosure manual. Such a manual has surfaced in the case of foreclosures in which Wells Fargo is one of the actors.
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The “decision” regarding the “claim” is not made by a human being. It is made by an algorithm on a computer server that has been programmed by coding specialists who were only tasked with producing the platform for receiving automated input and automated output.
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The input comes from financial technology companies that produce everything from reports on payments received from homeowners (regardless of whether or not those payments are owed or due), along with template forms filled in by AI for service upon the homeowner. The output is produced in the same way. Lawyers, judges, and homeowners think they are dealing directly with a lawyer and directly with the named “client.” But they are wrong.
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Suppose this scheme ever blows up (as it should). In that case, the object is to make it virtually impossible under current law to indict anyone because no one human being made any decision concerning any one transaction with any one homeowner. No one human being made any decision concerning initiating a claim, even though the claim was false and predicated upon false, fabricated, forged, backdated documents.

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Suits against the lawyers can only allege greed. They cannot allege that lawyers violated their professional responsibility unless they can cite specific evidence (attached as an exhibit) that is already in possession of the pleader that reveals actual knowledge the claim is false. You will never get it in discovery because of the attorney-client privilege doctrine and litigation immunity.
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PRACTICE NOTE: this is why you never get a straight answer when you ask for acknowledgment or affirmation that the “Client” is actually present at mediation, or agrees to any settlement or modification.
The inability to produce a sworn, statement or testimony from any authorized officer or employee of the named “client” (for example, US Bank, Deutsch, or Bank of New York, Mellon) is the foundation for an argument that the opposing side never showed up at mediation, and therefore violated court orders. Having violated the orders, they should be sanctioned in the form of preventing them from proceeding with the litigation.

Mental health epidemic: Doing nothing because we are “mental”

One of the stupid issues is that we know there is a mental health epidemic fueled by loneliness, terror and anger. Yet somehow, the media seems surprised or even outraged that our politics consists mostly of yelling at each other as if that ever changed anyone’s mind or it ever produced anything of value.

We know such behavior, hate rituals, and a society hell-bent on marginalizing mental health issues is bad for all of us. But we keep doing it. The currency is everyone’s imagination that if we yell louder, it will all go away or that we will at least somehow feel better for yelling. Are either of those hopes true?

We are lonely, and we are vulnerable because the system has turned away from governance and away from the general welfare to being all about money.

The sole thing that everyone across the world agrees upon is that money is the most important element of life. While there is a certain inevitable truth to its utility, the obvious result of thinking that money is an end unto itself leads to mean-spirited, anti-people practices by government and businesses.

As long they do it to make or save money it is good, regardless of how many people are miserable and die.

We saw this vividly when the foreclosure storm started in 2006. People were dying. They died by suicide, suicide by cop, etc. The entire government went to work prosecuting the illegal criminal behavior of the actors in a very dark play. 1 person went briefly to jail, and the rest went free. After all, it was “capitalism,” which is good, right?

When the governments of all the states and the Federal Department of Justice settled, they got the players to agree to stop using false, fabricated, forged documents — without admitting they ever did it. The players did not stop and even increased the use of false documents without effect. No foreclosure based on false documents was ever overturned.

“Doing it for the money” seems to be a get-out-of-jail-free card. Now and then, there is a prosecution of someone in order to throw the media and the public off the scent. Madoff was prosecuted for pretending that there were accounts when he was just spending money. Death and destruction went to that family in what was called the “largest economic scam in history.” ($60 billion).

Meanwhile, Madoff “coincidentally” was prosecuted at the same time that it became apparent that literally $80 trillion dollars had gone through an illegal securities scheme that could only survive by allowing actors to enforce it as though it was legal.

COVID, mortgage meltdown and mean-spirited practices combined with reckless indifference have all made us feel overburdened, isolated, and extremely vulnerable. The institutions that people were expecting to protect them failed in most respects, although the vaccine for COVID-19 did save millions of lives.

We need to treat the mental health crisis as an emergency that is equally important to climate change. If we don’t get our act together, our inclination to hate each other will reach critical mass, and someone somewhere will push a button that will end our run.

Just as importantly, the causes of mental illness of every type should be addressed. We have a social compact in our U.S. Constitution supposedly for the “general welfare.”

Certain functions are obviously for the general welfare and, therefore the province of government. Police, fire, and health is among those. Making sure the economy is running smoothly by making sure that people at the bottom rung are able to spend money with vendors is for the general welfare.

So the goal ought to be as follows:

  • Police is about safety (not social work)
  • Fire is about prevention, rescue and mitigation of damage.
  • Healthcare is about health (including social work)
  • Basic income is about maintaining a floor under our economy.
  • Justice is about law and not politics, religion or ideology. It is about facts.

The game continues and the courts are playing along.

The NY legislature is reponding to the decision  referenced below with a proposed “new law” that returns us to where we always were on the statute of limitations. If you can’t bring a foreclosure action within 6 years, forget it.

see “Bill would protect homeowners from endless foreclosure cases” —

https://www.nydailynews.com/opinion/ny-edit-mortgage-lenders-banks-legislation-nys-senate-assembly-hochul-bill-20221213-bx5jxakd65cmjpmo5l5v74b5x4-story.html

Under the rubric of “the homeowner MUST owe the money” — despite the absence of any foundation, courts continue to rule as though they know something about homeowner transactions whose only attributes as “loans” come from the label that everyone seems to use when describing them.

Let’s be clear: up until the “new laws” on mortgage foreclosure, any claimant wanting to force the sale of property — especially residential homestead property — had to meet rigid requirements.

And it was very often the case that even without the homeowner showing up and even without the homeowner having any lawyer to represent them, the homeowner won. Ask any lawyer who practiced before the year 2000).

This was because the lawyer for the foreclosing party had not produced the evidence showing that the client was the claimant and the claimant owned an unpaid loan account receivable on a ledger that it produced in court along with a live human being or sworn affidavit that warranted the truth of the matter asserted.

The recent NY Appellate court decision on the statute of limitations wrongly uses the attempt of the homeowner to avoid foreclosure against him. Since the homeowner made a payment under a temporary settlement, the homeowner was “reaffirming the debt” and starting the statute of limitations from scratch.

No, that is NOT what happened. The homeowner was coerced into making those payments to buy time while he or she figured things out. During that period of figuring things out, the foreclosure mill plowed ahead and usually secured a foreclosure judgment and sale. The property was sold, and the players all divided up the free money because none of them was owed anything.

Two things emerge from this absence of logic posing as reasoned judgment. first is that the fraudulent actors in foreclosures get to come back again and again forever while they attempt to create the illusion of ownership of an implied (but nonexistent) unpaid loan account due from the homeowner.

But the homeowner’s claims of fraud and violations of RESPA, FDCPA, and common law rescission are quickly barred by the statute of limitations. This bar nearly always arises before the homeowner has any idea that there is a claim for setoff in affirmative defenses, a counterclaim, or a collateral action.

All this is happening because judges, lawyers, and their client homeowners all believe that since it was labeled a loan, it must be a loan. And if it is a loan, they must owe the money. These are all reasonable presumptions that arise from the past history of similar-looking transactions. But past history is no guarantee or even relevant to the current circumstance.

I have reviewed thousands of cases. I haven’t found one case since around 2004 in which the company designated as “servicer” in a self-serving statement could ever produce a record (ledger) showing that a loan account was created, maintained, and administered through the present.

So here is the spoiler alert: if you are one of the hundreds of homeowners who take this concept to heart and pursue it aggressively, you will probably win the case, and there will be no foreclosure, there will be no claim, and the path may be opened for quiet title.

The case that foreclosure mills are heralding as a game changer is

FEDERAL NATIONAL MORTGAGE ASSOCIATION, & c., Appellant, v. Maxi JEANTY, & c. et al., Respondents, et al., Defendants.No. 84 Decided: November 17, 2022

Given the above, one might challenge Fannie Mae to produce an authorized officer who asserts and swears that it has ownership of an unpaid loan account on the ledgers of Fannie Mae — because it paid for it. It can’t and won’t, and neither will US Bank, Deutsch or BONY “as trustee.”

There are two reasons why homeowners keep losing homes to false foreclosure claims. First, they don’t challenge it because they think it is futile. Second, they believe everything that the dark side is saying.

Only a few hundred homes are saved each year by people accepting the idea that all trial lawyers accept: if you have a claim, then prove it, don’t just tell me about it. It doesn’t even matter if the debt IS real or due. It only matters whether the truth of the matter asserted (or implied) can be proven by competent evidence. The answer is that it can’t when challenged.

False claims of securitization revise custom and practice amongst banks

If you go into any bank looking to initiate a transaction with them, there is not a single exception that you will find anywhere with respect to general customs and practices in the banking industry – including investment banking.

They will first want you to identify yourself with specificity so that your identification could be corroborated through third parties – preferably government sources.

The second thing they will want is for you to identify the subject matter of the proposed transaction. With specificity, the subject matter can be identified and corroborated through third parties – preferably government sources.

Here is an example taken from documents prepared by and for a transaction in which banks were involved. It shows the kind of language that is typically used in connection with the necessary warranties of ownership and authority before any bank will execute the document:

Seller warrants that it (a) has (i) the authority to make the commitment set forth in Section 1.1 of this Agreement, and (ii) good and marketable title to all Gas delivered to Buyer at the Receipt Point(s), and (b) will have the right to convey, and will transfer good and merchantable title to, all of Seller’s Gas sold hereunder and delivered by it to Buyer, free and clear of all liens, encumbrances and claims.
No agent, employee or representative of Seller has any authority to bind Seller to any representation or warranty concerning the Equipment and, unless any representation or warranty made by agent, employee or representative is specifically included within this Sale Agreement, it is not part of the basis of the Sale Agreement and shall not be enforceable against Seller.
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What I have been writing about for years is there has not been a single executed assignment of mortgage, assignment of the beneficial interest under a deed of trust, servicing agreement, power of attorney, the limited power of attorney or any other document that says that the grantor owns the rights that are being transferred.  There is no warranty of ownership or authority to execute the document.
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The whole idea is that you never want to be caught doing things on your own. You always want to be saying that somebody else told you to do it and that you had a reasonable basis for believing their authority. If they didn’t have the authority, that is on them, not you. In a nutshell, that is the entire Wall Street playbook.
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  •  Wall Street is playing on our implicit bias. When we see an assignment of mortgage, for example, we make certain presumptions – regardless of whether they are true or not.
  • We assume that the party executing the document is an authorized representative of the identified assignor.  But there is nothing in the document that says that.
  •  We assume that the assignor had something to assign. But there is nothing in the document that says that. I have not seen a single assignment of mortgage in which MERS or any other assignor warranted that it and title to the mortgage.
  •  We assume that because an assignee has been named that it has received title to the mortgage and that it accepts title to the mortgage.
  • But in every case, in thousands of cases that I have analyzed, there has not been a single assignee who claimed ownership of the mortgage lien, note, or any payment claim.
  • Instead, they direct your inquiry to the “servicer,” which is imbued with the attributes one would expect from a bank that is named “as trustee.”

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So, for example, US Bank asserts that it is not liable to any homeowner as a lender or successor lender because it never owned the lien except as an agent for someone else. It also asserts no liability to the holders of certificates because US Bank neither owns nor has any rights over the management of any sources of income for the certificate holders.

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The absence of what is in these documents matters most under the law. The lawyer for the foreclosure mill cannot argue that the grantor owned “the loan”  without some foundation for that argument. The foundation cannot be found in the assignment, and there is not a single witness or sworn statement by anyone that will attest to the fact that the grantor owned anything.

PRACTICE HINT:  Don’t believe documents that appear to be downloaded from sec.gov. “Shelf registrations” allow companies to upload anything they want and then download them with the sec.gov header.

This has been used effectively to fool judges, lawyers and homeowners. In many instances, the lawyer for the foreclosure mill uploads the documents he wants to use as evidence.

He then presents the documents and claims the right to “judicial notice” as though it was a government document. But it is not a government document because it is not part of the records of any agency. It has not been reviewed or accepted, as you might think with the IPO filing. It is a private document that the lawyer has made it appear as a public document that comes from a government source.

Here is another example of the specificity required by banks:

CREDIT SUISSE. Credit Suisse represents and warrants to IMCO that (i) the retention of Credit Suisse by IMCO as contemplated by this Agreement is authorized by Credit Suisse’s governing documents; (ii) the execution, delivery and performance of this Agreement does not violate any obligation by which Credit Suisse or its property is bound, whether arising by contract, operation of law or otherwise; (iii) this Agreement has been duly authorized by appropriate action of Credit Suisse and when executed and delivered by Credit Suisse will be a legal, valid and binding obligation of Credit Suisse, enforceable against Credit Suisse in accordance with its terms, subject, as to enforcement, to applicable bankruptcy, insolvency and similar laws affecting creditors’ rights generally and to general equitable principles (regardless of whether enforcement is sought in a proceeding in equity or law); (iv) Credit Suisse is registered as an investment adviser under the Advisers Act; (v) Credit Suisse has adopted a written code of ethics complying with the requirements of Rule 17j-1 under the 1940 Act and that Credit Suisse and certain of its employees, officers, partners and directors are subject to reporting requirements thereunder and, accordingly, agrees that it shall, on a timely basis, furnish a copy of such code of ethics to IMCO, and, with respect to such persons, Credit Suisse shall furnish to IMCO all reports and information provided under Rule 17j-1(c)(2); (vi) Credit Suisse is not prohibited by the 1940 Act, the Advisers Act or other law, regulation or order from performing the services contemplated by this Agreement; (vii) Credit Suisse will promptly notify IMCO of the occurrence of any event that would disqualify Credit Suisse from serving as investment manager of an investment company pursuant to Section 9(a) of the 1940 Act or otherwise; (viii) Credit Suisse has provided IMCO with a copy of its Form ADV, which as of the date of this Agreement is its Form ADV as most recently filed with the SEC, and promptly will furnish a copy of all amendments to IMCO at least annually; (ix) Credit Suisse will notify IMCO of any “assignment” (as defined in the 1940 Act) of this Agreement or chxxxx xx control of Credit Suisse, as applicable, and any changes in the key personnel who are either the portfolio manager(s) of any Fund Account or senior management of Credit Suisse, in each case prior to or promptly after, such change; and (x) Credit Suisse has adequate disaster rec

THE STUDENT DEBT CRISIS IS UNDERMINING OUR FINANCIAL SYSTEM

Relief for students will not be seriously addressed, as long as policymakers and lawmakers are listening to Wall Street. Wall Street has a vested interest in maintaining securitization infrastructures and perceives any reduction or elimination of debt as a destruction of their carefully conceived plan and execution of a fake securitization scheme that evolved over four decades.

Relief won’t happen, except perhaps as a token gesture, simply because Wall Street is communicating its intent to withhold money from the campaigns of anyone who votes for substantive relief.

In so doing, Wall Street is undermining the national economy.

It should go without saying that in a consumer-driven economy, you want consumers to spend. Once again, Wall Street has interfered with the economy with the bogus entry into the lending marketplace. In so doing, it sold loans to 17-year-old prospective students who had no access to information that would reveal the consequences of the complex financial packages they were purchasing and that the students were induced to issue.

I should point out that students are allowed to sign these papers even when they are legally incompetent and even if their parents object. It is one thing to sell a complex financial product to people who are overly exuberant about buying a house at a price far above its value. It is quite another to sell complex financial products to people who have not yet completed maturity – physically, mentally or emotionally.

Wall Street interfered with our political process, making education an expense instead of an investment in the country’s future. There are several ways out of this, but nothing will happen unless the elephant in the room is identified.

The situation’s absurdity was amply highlighted by the documentary aired Sunday night, “Loan Wolves.”  It ended on a somewhat hopeful note that somehow student debt would be reduced or eliminated before the end of this year. That won’t happen. And the reason I’m writing this article is that nobody seems to be addressing the reason that it won’t happen.

I have written about this before, but virtually nobody has picked up on it. There are no federal student loan offices. They don’t exist. But there are private companies that sell these complex financial packages to students who are too young to drive or drink.  Frequently the people who are selling to them are not much older. Neither side of the transaction knows anything about what they are doing.

These companies act as brokers. The money temporarily comes from an intermediary for an investment bank. The originating company is named as the payee on a note incorporating mind-boggling terms in their complexity. Neither the note nor the unpaid account is sold to anyone. But the payee on the note has already agreed to release any claim to any payment, debt or note from the student.

In a pattern identical to the home loan fiasco that resulted in the 2008 crash, the investment bank maintains total control over the money without owning a single loan or account. Securities are then issued by the investment bank and sold to investors with the implication that the investors are buying something that is government guaranteed.

The revenue generated from the sale of the securities by the investment bank exceeds the amount of the financial package purchased by the student, resulting in the issuance of the note, which forms the basis for the fraudulent conjecture that a loan account was “securitized.”

Despite receiving enough money to pay for the transaction with the student many times over, no loan account is ever credited. This supports the false claim that an amount is due from the student as set forth on the promissory note, despite the absence of any underlying obligation.

The government in many cases is the guarantor of loans. Most people don’t think about what that means. The government will make up the difference if there is a loss attributable to the unpaid loan account. Up to now, the government has been complicit in issuing payments on nonexistent losses.

The documentary also discusses an absurd change in bankruptcy law in 1998. This was accomplished by the Clinton administration, which had no idea what it was doing, and Congress who also had no idea what they were doing. The change makes it illegal to discharge student debt in bankruptcy – even in part. This is a sharp departure, and some say a violation of the constitutional provision guaranteeing fresh starts in the form of bankruptcy.

This change puts student debt in the same classification as punitive damages. We are punishing students for believing salespeople whose income depends on commissions paid from fees received by the originating company or a sales organization related to the company.  And the fees, of course, are paid by an intermediary for the issuing investment bank since the goal of the scheme is to sell securities (not to make loans).

I have said before that I think the securitization of student debt eviscerates the government guarantee simply because there is no loss to cover with the guarantee. That being the case, any argument that the government is being protected by this change in bankruptcy is completely specious.

But if my rendition of the infrastructure is correct, then there is no need to declare bankruptcy since there is no debt. Once again, I strongly suggest that people who think they are “borrowers” should demand a copy of the loan account at the earliest possible time. And in the absence of receiving it, they should bring action against those who are making false claims of the right to administer, collect or enforce a nonexistent obligation.

PRACTICE NOTE: It is helpful to focus the analysis on the presence of two (2) issuers. We all know that the investment bank is both the issuer and underwriter of certificates falsely labeled as collateralized loan obligations.

But through the manipulation of labels, consumers are presumed to be borrowers, not issuers. I grant that some analysis methods would result in finding that they are both. But the overwhelming consensus is that the students are always issuers and sometimes borrowers.

I take the position that students are only issuers and therefore entitled to compensation for their role in an undisclosed securitization infrastructure. As such, they are probably entitled to additional compensation beyond what was given to them as a “loan.” But I acknowledge that in the Reformation of contracts with students and homeowners, they will probably be treated as both.

How This Homeowner is Winning

Hat tip for Scott Staffne, Esq. for uploading an “Outline of Oral Argument Re Motion for Sanctions.” First, I commend the preparation, which is notoriously absent from most homeowner arguments and motions. In addition, both Homeowners proceeding pro se and frequently their attorneys are completely unprepared to raise objections to hearsay, business records, judicial notice, leading questions, and the absence of any foundation of personal knowledge. This is how homeowners lose so consistently. Anyone can lose any case that way.

Here is ane example of using the rules to win the case without getting to the issue of whether any debt is unpaid or due.

The second note is that the homeowner took up on appeal an interim ruling regarding the judgment entered despite a lack of evidence to support it. The assumption was that the evidence would be forthcoming at the retrial, but the homeowner knew otherwise. Like most Chase cases, there was no evidence. They were bluffing.

And my third note relates to a standard practice I have, which is NOT to take a deposition unless it will serve a specific purpose. The purpose of the Discovery rules (which are specifically set forth in statutory law in each state and in the Federal system) is to lead to the disclosure and production of information that might tend to reveal admissible evidence relevant to the case. Of course, you must ask for it, or you are not entitled to complaint about it.

Most pro litigants and many lawyers forget )or never knew) that discovery was NOT limited to evidence. It is wide-ranging as a fishing expedition as long as it seeks information that is plainly relevant to the facts and issues of the case — even if the relevance is to the theory of defense with which the opposition disagrees.

Lastly, note that this is despite obvious resistance by the judge who probably was voting on consensus with other judges who think there is no valid defense to a foreclosure action. I don’t know how the case turned out, but the homeowner here is clearly headed for another case in the win column for homeowners.

see Pierce_County_Washington_Superior_Court

Here are some quotes from the “outline” referenced above:

Division Two reversed the previous decision of this Court foreclosing on David Morton’s home because Douglas Theener, a Chase VP had not supported his assertion that Chase possessed Morton’s Note when it was lost, with business records taking that statement outside of the parameters of the hearsay rule.

In order to obtain that evidence Theener asserted existed (which included the collateral file he had inspected) Morton noted the 30(b)(6) deposition of Chase’s designees to testify about the evidence Chase had in this regard. [EDITOR’S NOTE: THE COLATEREAL FILEIS THE LOAN ACCOUNT RECEIVABLE, WHICH DOES NOT EXIST. WITHOUT IT THERE IS NO CLAIM OR REMEDY]

Judge Aschraft at the second scheduled trial of this foreclosure case following remand ultimately acknowledged that Chase had refused to comply with this 30(b)(6) deposition notice when on the first day of trial he struck the trial to give Morton the opportunity to take Chase designee’s deposition a second time.

Now we are back again for trial and the evidence before this Court clearly shows that Chase’s designee still has not been prepared by Chase to testify about that evidence related to those topics which Judge Ashcraft ordered the Chase designee to testify about at his second deposition. Those deficiencies in the designee’s compliance with Judge Ashcraft’s order and the 30(b)(6) notice are well stated in Morton’s five page reply brief.

Because Chase cannot argue that it has complied with CR 30(b)(6) this Court must determine what is the “least severe sanction adequate to serve the sanction’s particular purpose but is not so minimal as to undermine the purposes of discovery.”

No sanction other than exclusion of the designee’s testimony is adequate because Morton was entitled to obtain discovery from a corporate designee who had been adequately prepared to testify about these matters. [e.s.]

SOME EXAMPLES OF AREAS WHERE CHASE’S DESIGNEE

WAS NOT PROPERLY PREPARED:

Collateral file – Designee never reviewed the collateral file so

couldn’t testify with regard to “the meaning of the assertions

previously made in this case by Douglas Theener” about that

file.

Assignment – Had no idea what assignment was being referred to in the comment section of the Bank One compliance record, which he testified showed that Bank One received the original note from First Franklin.

Corporate entities – Doesn’t know which Chase entity acquired Morton’s loan.

==========

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Neil F Garfield, MBA, JD, 75, is a Florida licensed trial and appellate attorney since 1977. He has received multiple academic and achievement awards in business, accounting and law. He is a former investment banker, securities broker, securities analyst, and financial analyst.
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FORECLOSURE DEFENSE IS NOT SIMPLE. THERE IS NO GUARANTEE OF A FAVORABLE RESULT. THE COMMENTS ON THIS BLOG AND ELSEWHERE ARE BASED ON THE ABILITY OF A HOMEOWNER TO WIN THE CASE NOT MERELY SETTLE IT. OTHER LAWYERS HAVE STRATEGIES DIRECTED AT SETTLEMENT OR MODIFICATION. 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.

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Your savings is more important than your FICO score.

The 50-state settlement and other settlements with the players in the financial markets did far more to elevate an illegal scheme than stop it. 

In the struggle to make ends meet day to day and week to week, consumers are unable to keep up with the macroeconomic facts and even find it difficult to keep up with their own finances. Less thn 20% of consumers balance their checkbooks and debt accounts.

Consumers rely on the banks that put them in the bad position that they find themselves.

Consumers are inundated with dozens of influences that Romanticize debt and Romanticize buying things. The average person would be far better off delaying purchases until they have the money to pay then using credit. Using credit means — by definition — paying a lot more for the product than you should (even if the product is on sale).

A TV that was priced at $2,000 and is now on sale for $1200 willl cost you over $3,000 if you use credit lines on credit cards to pay for it — unless you pay your bill in full at the end of the month.

The Federal agencies pride themselves at looking at the “big picture.” But the big picture for them consists of the systemic players in the financial system. They completely ignore the consumer who is the most important systemic player in an economy that everyone agrees is based on consumerism.

I’m not saying we should abandon consumerism. I’m saying that if consumerism is the basis of our consumer-based economy, the federal and state agencies should be far more protective of the consumer than they currently demonstrate.

The 50-state settlement and other settlements with the players in the financial markets did far more to elevate an illegal scheme than stop it.

The Fed likes to brag about the “We saved the world” recovery.

However, the unfortunate truth of the matter is a record Half of American Families Live Paycheck to Paycheck.

Does it Matter? Let’s investigate.

Unprepared for Nearly Anything

  • 50% are woefully unprepared for a financial emergency.
  • Nearly 1 in 5 (19%) Americans have nothing set aside to cover an unexpected emergency.
  • Nearly 1 in 3 (31%) Americans don’t have at least $500 set aside to cover an unexpected emergency expense, according to a survey released Tuesday by HomeServe USA, a home repair service.
  • A separate survey released Monday by insurance company MetLife found that 49% of employees are “concerned, anxious or fearful about their current financial well-being.”

Deleveraging? Where?

A Fed study shows U.S. Households Will Soon Have as Much Debt as They had in 2008.

The Federal Reserve announced Friday that the U.S. has $1 trillion in credit-card debt. Consumers hit that number in the fourth quarter of 2016, but eased on revolving credit during January 2017. The Fed announcement showed revolving consumer credit hit more than $1 trillion once again in February 2017.

“Credit card debt is rising quickly, but delinquencies are still really low,” said Matt Schulz, a senior industry analyst at the credit cards site CreditCards.com. “Many Americans are doing a good job of controlling their debts, but eventually with big debts and rising interest rates, it’s likely that something will have to give.”

Paycheck to Paycheck “Good Job”

Excuse me for asking but if half the nation lives paycheck to paycheck, is that really indicative of doing a good job at managing debt.

And as for “low delinquencies”, I remind you of my April 26 article Subprime Credit Card Losses Bite Capital One: Income Down 20%, Charge-Offs Up 30%.

Nonetheless, I remind you of an important perception.

We Saved the World

Two Reasons Not to Worry

  1. The stock market and housing are still going strong. We heard the same thing in 2007 but it’s different this time.
  2. The bottom 50% of the economy simply do not matter.

The real crux of the matter is point number two.

The Fed does not give a damn about the bottom half of the economy even though it spouts continual lies about “income inequality.

The Bottom 50% Do Not Matter

As long as the Fed can keep stocks and home prices elevated, there is no concern about the food-stamp, rent-subsidized, Medicaid-supplement, disability-income, Obamacare-subsidized 50% of Americans struggling paycheck-to-paycheck.

That money rolls in guaranteed, month after month!

That 50% cannot afford a house is irrelevant as long as suckers keep paying $500,000 to two-bedroom shacks in LA.

The game is to keep asset prices up so that the top 50% keep spending. The bottom 50% are taken care of by government (taxpayer) subsidies noted above.

Here’s the real deal: Fed Expects a Second Quarter Rebound, Higher Equity Prices.

Repeat Performance

The Fed needs to keep asset prices elevated even though it’s pretty clear concerns are mounting over bubbles.

Can the Fed save the world again?

Previously, the bottom third did not matter. Then the bottom 40% did not matter. Now the bottom 50% do not matter.

That statement is a bit over the top. By how much I don’t know. But the trend is clear, as is the fly in the ointment.

Brexit was the first warning shot. Trump was the second.

As soon as the bottom 65% don’t matter, those 65% may vote to take matters into their own hands.

http://www.zerohedge.com/news/2017-05-01/economic-reality-bottom-50-americans-no-longer-matter

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