Deutsch and other Banks Under Investigation by DOJ for Filing False Documents


Beth Findsen, Esq. in Scottsdale, Az posted an article on her blog back in February revealing that after 10 years+ the Department of Justice is finally examining the validity of the papers filed by the banks in support of purported foreclosures on behalf of ghosts. Beth is a realist as well as an idealist. And her skills as an attorney are second to none.

While the DOJ is always slow, they frequently get to the bottom of things when they put their minds to it. The prosecution of individuals working for the Banks may just be around the corner. Apparently there has been a serious on-going investigation since 2014. If an indictment follows, it will shake the entire foreclosure process to its core. If there is a settlement, then it will probably stay business as usual.

This is not the first case where a US Trustee in Bankruptcy has questioned the authenticity and validity of documents supplied by the banks. But it seems to be a more serious issue now as they continue to piece together whether the claims filed by banks as Trustees, servicers or agents are real. If they are not they are committing fraud on US Bankruptcy court which is a federal crime for which plenty of people have gone to jail.

The importance in bankruptcy cannot be overstated. The size of the bankruptcy estate is affected. On the asset side you have the house and its fair market value at the time of filing or the time of appraisal. On the liability side you have a party who claims to be a creditor but isn’t a creditor. Then you have John Does whose money was used without their knowledge in connection with the origination or acquisition of the alleged loan. And finally you have a prospective liability that either is secured or is not secured. This could affect everything from motions to lift stay to adversary actions.

Interesting parts of the article include

Although the investigation involves the case of only one homeowner in Connecticut, a court document filed on Jan. 26 by the United States Trustee’s Office said it wants to elicit information about Deutsche Bank’s practices in general in foreclosure cases.

In recent months, the office has stepped up efforts around the United States to block banks and law firms from using false or fabricated documents in home foreclosure actions. The effort follows disclosures in October 2010 of large-scale “robo-signing”, the mass signing of foreclosure affidavits containing “facts” that had never been checked, and wide production of false mortgage assignments.

The Jan. 26 court motion stated that “The United States Trustee has reviewed the documents filed by Deutsche in this case and has concerns about the integrity of those documents and the process utilized by Deutsche in” filing to foreclose.”

From Reuters:

April Charney, a Florida legal aid attorney who represents homeowners in foreclosure cases and who is an expert on mortgage securitizations, said that aside from possible sanctions against Deutsche Bank in this foreclosure case, the results could have significant effect on Deutsche Bank’s practices in general, and on its ability to foreclose on large numbers of homeowners in default.

Lawyers for homeowners in foreclosure have alleged similar practices by Deutsche Bank in cases around the country.

Beth Findsen Weighs in on Steinberger

Beth Findsen, Esq. of Scottsdale, Az who is arguably one of the best legal writers in the country, along with our own Danielle Kelley, Esq. in Tallahassee, has written an article that I think captures the essence of the Steinberger. You can read the entire article HERE. As usual, Beth succeeded in stating the point in far less words than I do.

The court does a good job of explaining the separate instruments of the note and deed of trust, and listing and describing the rights and responsibilities of the three entities involved in a deed of trust, the trustee, the trustor, and the beneficiary.

The court understood the problem of an assignment of an interest years after the interest has already been transferred.  If there is no interest to transfer, nothing transfers.  It’s as simple as that.

The court also does a good job of analyzing what the Arizona Supreme Court actually said in the oft-cited Hogan case.  The Hogan court did not say that one can never mention the authority of the beneficiary or the note holder in a lawsuit opposing foreclosure, or risk being swept into the dreaded “show me the note” category and summarily dismissed.  Rather, the Hogan court was concerned with the lack of affirmative allegations in the Hogan pleadings about how and why the beneficiary might lack authority, or might not be the beneficiary.

The Steinberger court also recognized that the point of listing securitization facts is to establish a timeline that may show that the transfers in a purported chain of title cannot be true, if the note was in fact transferred to a securitization trust by a set closing date.  This is relevant to the beneficiary’s claimed authority, not an attempt for the homeowner to be claiming rights or enforcement under the third party securitization documents.


Foreclosure Strategists: OCC & Federal Reserve Bank: Foreclosure Review Process

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Editor’s Comment:

Contact: Darrell Blomberg  602-686-7355

Meeting: Tuesday, June 26th, 2012, 7pm to 9pm

OCC & FRB have finally established dollar amounts for
”errors, misrepresentations, and other deficiencies in the 
foreclosure process” for the Independent Foreclosure Reviews!

Complaint filing date extended to September, 30, 2012!

As we are all aware the OCC (Office of the Comptroller of the Currency) has been inviting homeowners / dispossessed homeowners with a personal link to foreclosures that were in process or completed in 2009 or 2010 to file complaints.  Many people have been loathe to go through the complaint process because of the lackluster prospect of receiving a paltry $2,000.  Well, that has officially changed in writing!  The OCC and the FRB (Federal Reserve Bank) have now established dollar amounts for the remedies of errors, misrepresentations, and other deficiencies in the foreclosure process.


If you know any homeowners who were foreclosed or dispossessed of their home after January 1, 2009 or they were alleged to be in default of their note prior to before December 31, 2010 this is a must attend meeting.  (I believe you could even make a valid argument for anybody that received a 1099A or 1099C anytime in 2009 or 2010 even if their sale / dispossession was long before January 1, 2009.)



Hogan Decision & Subsequent Actions

We will review the Hogan v Washington Mutual Bank, N.A. decision and explore the Motions for Reconsideration submitted by both the Appellants and the Appellees.


Ninth Circuit Appeals Court Audio – Beth Findsen

Local foreclosure defense attorney Beth Findsen argued in front of the Ninth Circuit Appeals Court in San Francisco in the Mariusz Buchna, et al. v. Bank of America NA, et al. ( No. 10-17651) case last Friday.  Here is a link to the audio of that proceeding.


$50 Million Sweep is ON HOLD!

On Tuesday, 2012-06-12, the plaintiffs and defendants in the Morones – Hernandez v Horn (Az AG) & Ducey (Az Treasurer) case stipulated that the $50 Million Sweep from the Attorneys’ General Settlement Funds will not be transferred to the State of Arizona General Fund until at least 2012-12-31!  The Minute Entry can be found at this link:

See “COURT WATCHERS – Upcoming Hearings” section below for next hearing information.

We meet every week!

Every Tuesday: 7:00pm to 9:00pm. Come early for dinner and socialization. (Food service is also available during meeting.)
Macayo’s Restaurant, 602-264-6141, 4001 N Central Ave, Phoenix, AZ 85012. (east side of Central Ave just south of Indian School Rd.)
COST: $10… and whatever you want to spend on yourself for dinner, helpings are generous so bring an appetite.
Please Bring a Guest!
(NOTE: There is a $2.49 charge for the Happy Hour Buffet unless you at least order a soft drink.)


I have set up a Facebook page. (I can’t believe it but it is necessary.) The page can be viewed at, look for and “friend” “Foreclosure Strategist.”

I’ll do my best to keep it updated with all of our events.

Please get the word out and send your friends and other homeowners the link.


I have set up a MeetUp page. The page can be viewed at Please get the word out and send your friends and other homeowners the link.

Home Defenders League

The Home Defender’s League supported the Lilly Washington event.  They are building a nationwide coalition to support underwater and distressed homeowners.  Here is a link to their website:

They have a feature story about Lilly Washington at this link:

May your opportunities be bountiful and your possibilities unlimited.

“Emissary of Observation”

Darrell Blomberg


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What we NOW know about Loan Securitization & Foreclosure Defense

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Workshop Details

Where: The Windmill Suites-Chandler Fashion Square
3535 W Chandler Blvd
Chandler AZ 85226
Hotel Phone: 480-812-9600
When: Thursday July 26th
Registration: 8:30 am
Seminar: 9:00 am – 12:00 pm
Pre-registration – until June 26th: $179 – Save $30!!
Registration – from July 7th –July 20th: $199
Late-Registration July 20th – July 26th: $249
Audience: Paralegals, Lawyers, legislators, title agents, realtors, homeowners or anyone thinking of buying short sales or re-sales
Arizona 2.5 CLE’s available
including .5 Ethics!
Presented by: Neil F Garfield, MBA JD, Beth Findsen JD, and Darrell Blomberg
Neil Garfield is Licensed in Florida and Beth Findsen is Licensed in Texas and Arizona. Both are members of the Federal Trial Bar.
Workshop Content to include:
  • Preliminary letters and correspondence
  • Putting your best foot forward; evidence
  • Administrative agencies
  • Foreclosure rescue scams
  • Auction issues at foreclosure
  • Civil Procedure
  • Appellate Procedures
  • Title & Title Insurance

Handouts will be distributed electronically when you register and should be brought to the workshop either in printed or electronic format according to your preference.

Participants will also receive special workshop discounts on products and services purchased at the workshop!

For more information contact:  or 520-405-1688

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  • These topics are introductory in nature and are for general information. Information obtained in this workshop should not be used as a substitute for the advice of a competent licensed attorney in the jurisdiction in which you are located.
  • Attorneys in other states will probably be permitted to claim CLE credits from Arizona, check with your state’s bar for more information.

BAD FAITH: Judges Getting Testy About Lawyer’s Representations and Bad Treatment of Borrowers


“the misleading statements made to both the court and plaintiffs’ counsel constituted willful misconduct.

Accordingly, the defendants are hereby adjudged to have accepted the July 1, 2009 agreement signed by the plaintiffs (Adv. Pro. No. 09-4045 AN, Docket No. 20), and are fully bound by the terms thereof. The terms of that agreement supercede and replace any and all terms that are inconsistent therewith in any and all notes and deeds of trust previously executed by the parties, their successors and assigns.”

submitted by Beth Findsen, Esq., (one of the finest writers in the legal profession), Scottsdale, Az

Editor’s Note: One of the wild cards in this drama is the 800 pound gorilla factor — judges can do what they want and if you don’t like it, go on appeal, where your chances are on average 1 out of 6 that you will get a nod from the appellate court. This particular Judge has expressed in writing what many other Judges have expressed orally in court and in background interviews with me — if what I say is true there will be hell to pay.

Well, it’s true and now everyone knows it. The representations by counsel for the pretender lenders are no longer being taken at face value. They have the lost the advantage of the presumptions they were creating. And here, the court took its gavel and hammered a settlement down the pretender lender’s throat. You can expect more of this behavior each day as this epic unfolds.

From an order signed by Judge Newsome, U.S. Bankruptcy Court

Many, perhaps most, of these debtors are not good candidates for a loan modification. But that does not excuse the indifferent and sometimes deplorable treatment they too often receive at the

hands of their lenders; nor does it obviate the desperate and helpless condition in which they find themselves. Indeed, never in my 27 years on the bankruptcy bench have I witnessed such financially and emotionally distressed families as I have seen pass through this court over the past two years.

Ultimately, there is little this court can do to facilitate the loan modification process or right the wrongs that debtors may have suffered from that process. That is particularly true in chapter 7 cases such as this, where the automatic stay lifts upon entry of the discharge, regardless of what the court does with a lender’s motion for relief from the automatic stay. See 11 U.S.C. § 362(c)(2)(C).

But when attorneys come before the court and play “fast and loose” with the truth, or rely on the bureaucratic obfuscations of their clients to dodge commitments they have made, this court is required to act to protect the integrity of its processes. If the court cannot rely on and trust the authority and words of the lawyers that appear before it, it cannot effectively handle the increasingly heavy volume of work confronting it, thus risking systemic collapse. That trust has been breached in this adversary proceeding, and the remedy of judicial estoppel perfectly suits the facts presented.

Accordingly, the defendants are hereby adjudged to have accepted the July 1, 2009 agreement signed by the plaintiffs (Adv. Pro. No. 09-4045 AN, Docket No. 20), and are fully bound by the terms thereof. The terms of that agreement supercede and replace any and all terms that are inconsistent therewith in any and all notes and deeds of trust previously executed by the parties, their successors and assigns.

As for the issue of sanctions, the defendants’ failure to appear at status conferences and respond in timely fashion to court orders alone amply support a finding of bad faith in the conduct of this litigation. The total indifference shown towards the court’s processes, the waste of judicial resources that resulted, and the misleading statements made to both the court and plaintiffs’ counsel constituted willful misconduct. In re Deville, 361 F.3d 539 (9th Cir. 2004); see also U.S. v. McCall, 235 F.3d 1211, 1217 (10th Cir. 2000).

Although the court’s August 7, 2009 Order Scheduling Evidentiary Hearing does not specifically mention that sanctions might be imposed pursuant to the court’s inherent power, the court made its view clear at the August 5 hearing that the bank’s conduct in not consummating a settlement might constitute bad faith. August 5, 2009 transcript, pg. 5, Adv. Pro. No. 09-4045 AN, Docket No 31. See Doi v. Halekulani Corp., 276 F.3d 1131 n. 7 (9th Cir. 2001); see also In re Lehtinen, 564 F.3d 1052, 1060-61 (9th Cir. 2009).




A lot of people are signing up for the newsletter. More than I imagined would do so. I found out quickly why. They were looking for strategies that drilled down more deeply into their cases. And they liked the teleconferences that go with it. The discounts on services were welcomed but it was the latest and best info I could give on what is working and what isn’t that they were looking for. It all comes down to what Beth Findsen, Esq. (Scottsdale) is fond of saying “You can be right as rain on the law but if the Judge won’t apply it, you lose!” Jon Lindeman, Esq. (South and Central Florida), with his military background, has impressed on me the need to concentrate our firepower on the areas we can identify as their vulnerabilities and press the point to win, not justify a fee. April Charney, Esq. (Jacksonville) has criticized my work as spawning some bad results and she has a point.

As you can imagine, some of my regular readers are not necessarily singing from the same prayer book as I am. They just want a preview of the song so they can confront anyone who uses the information with an answer. I really don’t have any problem with the opposition reading my material nor with them “preparing” to meet us in the battlefield we call court. The problem I have is that many homeowners and their lawyers are making bad law by misapplication of the suggestions contained on this website. It’s not that the pretender lenders are beating these homeowners and lawyers, it’s that these homeowners and lawyers are beating themselves by presenting this work as some kind of magic bullet. The Judge makes a not unreasonable assessment of their argument as complete crap and then goes on to assume that anyone else who sounds similar is also full of crap. This is making it more difficult for everyone. So what to do?

My answer is to migrate strategy and tactics to the newsletter and leave the general stuff on the blog. By charging a monthly fee, we hope to weed out those people looking for a quick fix and who are making it harder on everyone else. So I might have hints in the blog, but I won’t get into the details except in the newsletter, which will really focus on the prime strategies and tactics that show promise. Assuming I continue to get the support of subscribers on this, I will get into the down and dirty details as much as possible in the newsletter. It’s more work for me but worth it if we get the result of more lawyers and homeowners getting better results. By combining this with members only teleconferences, we know who is listening, and we have an opportunity for everyone to go out with the same message instead of variations on the message that might not make any sense to a Judge.

So this is another step in forming the movement, and concentrating our firepower. The hope is that we are creating the eye of the hurricane where all the action happens. By funneling the general information into direct strategies that are being used in common, and narrowing the focus even further by collaborating with investigation, discovery and motions (Title and Securitization Searches, Expert Witness Declarations, Affidavits etc), we hope to level the playing field. Remember they have the resources and the motivation to collaborate and they do with nationwide telephone conferences and shared research and strategies. It is up to us to do the same thing on our side. We have 20 million or more homeowners who are affected including those who think they lost their home but still have a right to reclaim title and possession. It seems to me that we have more than enough potential to level the playing the field and then some.

Identity Theft as a Cause of Action

From Beth Findsen, Attorney in Scottsdale, AZ, she comments that ID Theft may just be the heart of the matter in seeking damages. The logic is simple: they used every borrower’s signature for selling a pool of loans that included OTHER borrowers and a huge undisclosed profit was generated by using the borrower’s signature. Without that signature there would have been no deal. This is especially true if the person was one of the top tier tranche borrowers with 800 FICO scores etc. Without them making the pool look pretty there would have been no sale. Those people were neither compensated nor informed of the use of their very personal information.

The elements are pretty clear. Use of a person’s ID without their consent. Loss to another person. This is another connection between the interests of the borrower and interests of investors.

The essence of securitization of loans has been the unauthorized use of the borrower’s ID to create a collection of loans that were sold as more valuable than any single loan would have been priced, based upon the presence of multiple parties who had no idea that their name and identifying information was being passed around the world like a “whiskey bottle at a frat party” as reported by MSNBC.

Privacy is a commodity. It is constitutionally and statutorily protected. It can be waived or it can be bought, if the person is willing to sell it or waive it. But it cannot be taken by a “lender” (pretender or otherwise) to use for their own profit. That profit belongs to the person or persons whose identity and privacy have been violated — along with punitive damages if it can be applied.

Quoted from Beth:

is it “consent” if it’s based upon a fraudulent misrepresentation or failure to disclose?

in AZ

13-2008. Taking identity of another person or entity; knowingly accepting identity of another person; classification
A. A person commits taking the identity of another person or entity if the person knowingly takes, purchases, manufactures, records, possesses or uses any personal identifying information or entity identifying information of another person or entity, including a real or fictitious person or entity, without the consent of that other person or entity, with the intent to obtain or use the other person’s or entity’s identity for any unlawful purpose or to cause loss to a person or entity whether or not the person or entity actually suffers any economic loss as a result of the offense, or with the intent to obtain or continue employment.

Financial Double Jeopardy and Illegality of Securitization

Editor’s Note: to most Judges and most lawyers the thought that a home could be foreclosed by the wrong party, or that there could be a declaration of default on a satisfied mortgage, and that these things could lead to sale of a home by a bank or other party that doesn’t own it to someone who also doesn’t own it — all these things are counter-intuitive. If certainty is a measure of confidence in the marketplace everyone has been certain about real property transactions which must be recorded in the property recording office of each county  in which the property is located.

So when you go into court or challenge the pretender lender out of court, they have the advantage of knowing that any Judge who hears your pleas is first going to assume that your defenses are technical, not real, and designed to delay the inevitable. It is stories like the one below you must keep in mind along with the quote from Beth Findsen who always reminds us that “you can be right as rain on the law, but if the Judge refuses to apply it, you lose anyway.”

That is why it is so important to get your act together (use the free intake form on this blog), get a forensic analysis done that includes securitization, and get an expert declaration that you or your lawyer can use in court. In the first round of motions you won’t convince the judge you’re right and the other side is wrong. But you CAN convince him that your case possibly has merit, that you are entitled to discovery, that you are entitled to a temporary injunction or temporary retraining order, and that you have a right to a hearing on the merits.

Having third party reports and declarations in your hand that you can lay down in front of the judge goes a long way to convince the judge that you at least have the right to be heard on the merits even if, at the moment, he or she doesn’t think it likely you will prevail. If you properly plead and show the Judge something he or she can hold in their hand that, if proven, means you would win the case, then the judge is more likely to follow the law and allow you to proceed.

NAPLES — It was retirement incarnate. Then, the foreclosure lawsuit came.

Warren Nyerges, 45, left his law enforcement career and moved to Golden Gate Estates late last year with his wife. He was spending his days preparing his backyard for grass, painting the interior of his home and joking about the snow he abandoned in Cleveland.

“I’ve had nothing but a ball. To come down here, it’s a life dream,” Nyerges said.

To top it all off, the couple’s single-story, 2,700-square-foot home was paid off. Nyerges said he even offered $5,000 more than Bank of America was asking, quickly sealing the deal with title insurance.

But on Feb. 18, a man came to the couple’s home with a lawsuit. Bank of America had begun foreclosing on the property, and Nyerges’ dream was temporarily put on hold.

“I wish I could have taken my blood pressure the day I got served that thing, because I was livid,” Nyerges said. “I told my wife it shortened my life by 10 years.”

Nyerges said he called the process server, who told him to call the courthouse, where officials told him to call the lawyer, who then told him the issue was between him and Bank of America. Nyerges said he felt like many of the officials thought he was trying to get out of paying a mortgage.

After he was served, Nyerges said in a March 1 interview, “each and every day thereafter, excluding Saturdays and Sundays, I’ve been in contact with someone from the bank or the law firm.”

After unsuccessful calls to Bank of America’s main number, Nyerges said he went to one of the bank’s branches, found a manager, and “plopped this mess down on his desk.”

“I work for Bank of America. I am with these people. This lawsuit has no merit. It needs to stop,” Nyerges said the bank manager told others at the company after reviewing Nyerges’ documents. Nyerges said the bank didn’t believe their own employee.

On Feb. 22, he went back to the bank branch and had the documents faxed to the company. By March, an employee at the bank said they were researching the case, Nyerges said.

“They’re researching it,” Nyerges said the bank employee told him. “Calm down.”

“She just couldn’t understand why I was so upset about this,” Nyerges said, adding that he was nice at first, but later became more frustrated.

With multiple trips to the bank branch and the courthouse and about 25 hours dealing with the suit, which he had 20 days to respond to in order to avoid acknowledging the facts as accurate, Nyerges said he had no choice but to file a motion.

Acting as his own attorney, Nyerges’ first motion demanded the suit be dismissed with damages and he later filed a second motion seeking $2,500 for his time and expenses.

In a statement, Bank of America said officials are still trying to determine what happened.

“Bank of America sincerely apologizes to Mr. Nyerges for this inconvenience. We are currently researching the matter and are stopping the foreclosure,” the statement said. “We are still in the process of identifying the root cause that created this issue.”

Public records filed for Nyerges’ property add only more confusion to the situation. According to the records, the previous owners are Henry and Nelly M. Imbachi, who bought the home in July 2005. The lawsuit is related to the first of two mortgages they took on the property by August 2005.

When her husband lost his job, Nelly Imbachi said Bank of America foreclosed on the second mortgage. That foreclosure began in September 2008, Bank of America obtained title to the home in April 2009 and the second mortgage — not the first mortgage — was satisfied in August 2009, according to official records filed with the Collier Clerk of Court.

Nelly Imbachi said the unemployment insurance she had with Bank of America didn’t help. She said the company told her she didn’t file the necessary papers. She said the family never got a lawyer, later filed for bankruptcy and have not been notified of the current lawsuit.

“When they told us we lost the house, that is when we stopped paying,” Nelly Imbachi said of the first mortgage.

Tuan Van Ho, a Macro Island man who did not return a request for comment, then purchased the home for $155,000 on July 17, 2009, according to official records.

A month later, Nyerges purchased the home for $165,000, just three days after the Imbachi’s second mortgage was satisfied, the records indicate. In November, Nyerges said he looked up the property on the Collier County Property Appraiser’s Web site, discovered Ho was still listed as the owner, and asked for the situation to be corrected.

Indeed, on Nov. 13, 2009, Ho transferred the property back to Bank of America for no cost, two-and-a-half months after Nyerges had bought the home from Bank of America and while the Imbachi’s first mortgage still wasn’t satisfied.

So, what led to Nyerges being named in the suit remains a mystery. For the most part, Nyerges is more concerned, he said, with having his family’s name cleared, damages for the time he has spent and expenses paid fighting the suit, and a return to the relative serenity he once had.

“As I explained in my pleading today, they cost me long distance phone calls, gas, time and do you know how far my house is from the court house?” Nyerges said. “A lawyer would charge you $200 or $250. I’m charging $100. Just cut me a check for $2500 and we’ll act like the whole thing never happened.”

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