Attorney Verification of Foreclosure Complaints

This is a blatant flaunting and end run around the rule of law. Following a 15 year tradition of fabricating “facially valid” documents, lawyers are having an employee of the law firm sign documents to verify a complaint or other filing.

Get a consult! 202-838-6345 to schedule CONSULT, leave message or make payments.

Practically every consult I do for attorneys in litigation involves some document that was fabricated, forged and/or robosigned. This trick at misdirection of the court is accomplished by fabricating a document that looks to be facially valid but contains nothing but blatant lies about the people who signed it, the people who offered it, and the lawyers who pursue a false narrative based upon the presumptive validity of documents they know are not just flawed but more importantly fictitious having been fabricated strictly for the purpose of litigation and foreclosure.

Such documents are inadmissible, so the false proffer in court is that they are old valid and authentic documents that were not fabricated for use in court.

The latest turn (although not new) in these events is the execution of a “verification” or other document to be filed with the court by an employee of a law firm that at least initially starts the foreclosure. You may remember that David Stern and others made millions providing this service to banks, servicers and other parties who were involved in the initiation or maintenance of an action to foreclose. While Stern lost his license to practice law, he made off with tens of millions of dollars in fees directly attributable to falsifying documents.

Like the Bernie Madoff situation, some people were thrown under the bus and some people were not. Madoff’s PONZI scheme was not a singular event involving the the largest economic crime ($60 Billion) in Wall Street history. The publication of it gave convenient cover to underwriting banks and other cooperating entities involved in the absolute greatest of all PONZI schemes — the sale of worthless securities issued by empty trusts (over $5 trillion). The PONZI aspect was the same. But Madoff’s scheme was barely 1% of the amount stolen by Wall Street banks. And the Courts have been unwitting accomplices.

The actual “promise to pay” the investors came from the empty trust and not a homeowner or group of homeowners. The debt owed by homeowners was never owed to either the creditor (the investors) nor the trust (which was empty and never operated).  And the payments came from a dynamic dark pool consisting entirely of investor money that was legally and actually supposed to be in a bank account clearly labeled for the REMIC Trust that issued the RMBS — and then managed by a “Trustee” but the Trustee turned out to have no power. All the payments received by investors came from the dark pool — not from borrower payments or recoveries in foreclosure.

All power was vested in the “Master Servicer” which of course was the underwriter who sold the bogus RMBS in the first place — another hallmark of control always present in PONZI schemes. The entire scheme was based upon invested capital being diverted from the trusts — and then covered up by (a) payments out of the dynamic dark pool (PONZI) and (b) originating rather than buying nonconforming loans (a more elaborate PONZI).  The rest of the money was concealed in “trading profits” that are gradually released from the stockpile of money sucked out of the economy by the participating banks.

All of these transactions were “off balance sheet.” Since there were no “real transactions” in “real life” (loans, sales of loans creating a chain) the obvious fraud could only be covered up by getting court orders on a mass scale that assumed the false bank narrative was true. Those court orders and judgments were the first and only presumptively legal document in the entire chain. This is why the banks seek foreclosures at all costs to seal up potential civil and criminal liability for their initial theft from investors. Modifications must be done for purpose of appearances, but they are an intrusion into the business plan of getting as many foreclosures booked as possible.

In order to obtain such orders judges had to be satisfied that the designated forecloser was indeed a “lender” or “Creditor.” In order to do that the banks had to present fraudulent documents. In order to get the fraudulent documents through the system, the bank attorneys knew that in most cases they would only need to present “facially valid documents.” The judges would not look “under the hood.” And borrowers who could see the scam did not have access to information that would lead to the discovery of admissible evidence. Hence most contested foreclosures are still resolved in favor of the co-venturers involved in the fraudulent scheme.

Foreclosure mills are among the people whom the banks will readily throw under the bus (“we’re shocked to discover that our law firm was committing such heinous crimes”). If the law firms were unwilling to provide these “extracurricular services” they never would have retained the business of foreclosures. The banks needed to win because they needed that one legal document that would create the almost conclusive presumption that everything that preceded the judgment allowing foreclosure. And the banks knew that could only be done by fraudulent misrepresentations to the courts, to borrowers, to government agencies including law enforcement that to date has jailed absolutely nobody except Lorraine Brown of DOCX.

So what do I say when represented by an obviously  false document executed by an employee of the foreclosure mill? For example I just received (hat tip to Bill Paatalo) one such “verification” in  which the signor declares that the client is out of town and so the law firm is executing the verification for the client.

The obvious response is that (1) being located somewhere else doesn’t prevent an authorized competent person from doing the verification (2) the absence of a competent witness does not give authority to anyone else to verify as though they were a competent witness (3) the verification does not and probably cannot assert that the signor is competent, to wit:

COMPETENCY consists of (a) OATH (b) PERCEPTION (C) MEMORY and (d) the ability to communicate what the witness saw, heard or otherwise experienced personally.

The law firm clearly has no personal knowledge and therefore is executing the verification just to satisfy the elements of a facially valid verification, when both reason and parole evidence clearly shows that the verification is a sham.

Hence, sanctions should be appropriate against the employee who signed it, the lawyer, the law firm and the “client” if the client knew that this was being done. Of course in most cases the party named as bringing the foreclosure is NOT the client, which is another fraudulent misrepresentation in court that would defeat jurisdiction. The client is always the sub-servicer who takes orders from the “Master Servicer”, i.e.  the underwriter who created bogus trusts to issue bogus mortgage bonds and walked away with trillions of dollars.


Authority of BKR Courts In Question as to Final Orders and Judgments

In the attached white paper, it is clear that many of the findings and judgments of Bankruptcy judges have dubious standing. Once referred to as Referees, and appointed under entirely different rules, subject to removal without tenure etc.., the elevation of the people serving on the bench to the term “Judge” is what is causing the problem. In the Stern case and further discussion in the white paper it is concluded that BKR judges lack jurisdiction or powers that would “Settle” any factual matter regarding property that is indisputably part of the bankruptcy estate. The paper also questions the authority of magistrates, but leaves us wondering whether the Trustees are exceeding their own authority when they fail to protect creditors and the debtor when there are genuine issues of fact regarding ownership of the loan.

Abandoning an interest in real property on which there is no legal encumbrance might well be an abuse of Trustee discretion, and acceptance of it might be beyond the power of the BKR Judge. But confusion abounds. I have personally seen orders granting lift stay motions that recite that the movant was the owner of the loan without any evidentiary hearing or any basis other than proffer by the movant of dubious affidavits or even without any affidavits.

This timely white paper, should be read in its entirety because it opens up a whole panoply of questions, objections that should be made, and the obvious lateral appeal to the supervising district court judge strictly on procedural grounds.

It appears as though the authors lean in the direction of treating BKR Judges as having many procedural powers of a civil court judge but lacking the power to render a verdict or conclusion on contested facts. This possibility then opens the issue of whether disputed facts should be automatically brought before the lifetime appointed district court judge with the BKR Judge deferring until a ruling is given in the proper court.

Reasonable people may differ, but where there are genuine issues of material fact, it seems to be a denial of due process to skip the hurdle of an adversary hearing is conducted by the district court judge subject to the rules of evidence and procedure and putting the burden of proof where it belongs.

All too often the order lifting stay recites that the movant is the owner of the loan and this in turn is taken by both litigants and state judges as res judicata as though the case had been tried. In fact, this is the case even when the Judge doesn’t recite the “finding” that the movant is the owner of the loan. In either case, the burden of proof of “colorable claim” is so low that it could never measure up to a preponderance of the evidence — which would lead to a verdict that this white paper and the Stern case would seem to indicate is beyond the powers of the BKR judge.

SEE W_SternPaper

WEIDNER: Stern Revelations Affect Hundreds of Thousands of Homeowners


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EDITOR’S COMMENT: It is of course important that there was and remains criminal misconduct across the country in the processing of fraudulent foreclosures on behalf of entities who are misrepresenting themselves as creditors, submitting credit bids at auction without any authority, and demanding amounts “due” that do not account for all payments received, or the actual balance due, if any, on the actual creditor’s books.

But that is the point. Our attention is diverted to the presumed paper chase caused by the volume of foreclosures and misguided attempts to push them through faster. What is lost in all this is that these were not misguided attempts. They were all strategic implementation of a cover-up.

By diverting our attention to the paperwork, we are skipping over the question of why the paperwork had to be faked. Tens of millions of mortgages were processed and only a fraction of those were foreclosed. If they were able to process what went into the pipe, why can’t they process a much lesser volume coming out?

The answer is that they could have provided the valid paperwork if there was any valid documentation. That they didn’t and chose instead to fake it shows that the original obligation, note and mortgage are subject to inquiry. The originating “lender” was in most cases not the creditor. Neither was the mortgagee or beneficiary. Instead an undisclosed creditor was the source of funds and the obligation arising from the loan inured to the benefit of the party loaning the money.

The problem for the Banks is that if the focus shifts to the investors who purchased the bogus mortgage bonds, then the accounting shifts with that and then the s–t really hits the fan. The balance claimed as due in nearly all foreclosures is intentionally misstated, omitting any receipt other than the payment by borrower when they were receiving payments and processing payments to the creditor reducing the amount owed owed to the creditor under the original loan.

The high probability is that most loans are undocumented in that the advance of the money by the investor is nowhere to be found in the closing documents with the borrower. The money trail shows  clearly that the investors at this point are holding a mix of money from pools that were paid off, reduced balances from payments received from the servicer and other parties, and closed pools that were dissolved with payment or reconstituted into other pools.

Even this would be easy to provide in Court if the Banks didn’t have a reason to stonewall it. Besides the reason that they want another multiple payment of the same loan for which they have been paid many times, they do not want an accounting for the investor creditors to surface. If that happens, the investor creditors will not only find that payments have been received that were not stated in distribution reports and accounting to investors; they would also see very clearly that a giant chunk of what they thought went into funding mortgages actually went into the pockets of the intermediaries without any disclosure to the investor or the borrower. Thus the amount  owed to the investor creditors was far in excess of what the borrowers owe.

The amount taken from investor funds as a tier 2 yield spread premium and booked as trading profits exceeds the amount of defaulted loans. Thus the investment banks are stuck in the model depicted in the movie “The Producers” in which they sold 10,000% of a show guaranteed to fail. Nobody asks for an accounting for a failed show.

Here the investment banks sold the same loan repeatedly using different names and identifying data, which is bad enough. But in addition, they used the yield spread difference between the usual loan with triple A rated borrowers and all other borrowers to come up with “trading profits.”

These trading profits were extracted by way of a sale of the loans to the pool in which a profit emerged because in order to cover the expected interest income expected by the investors they loaned money at twice the anticipated rate, which reduced the amount they needed to lend. Thus a $200,000 loan could be sold as many as 40 times using exotic instruments that masked the “sale” and the money received from the investor might have been as much as $400,000 to fund the $200,000 loan.

So the revelations of  dirty dealing at the David Stern law office are a mere distraction from the real truth: that not only were the foreclosures faulty for lack of proper documentation, they were unnecessary because the loan had been been paid down far more more than was reported to the court and the investor to whom it was owed had abandoned the claim in favor of going after the investment banker that sold the bogus mortgage bond in the first place.

CONCLUSION: Weidner’s question can be answered like this: All the foreclosures must be reversed and reviewed with the burden on the forecloser to prove that the accounting was right and that the proper parties were included in the foreclosure.

January 4th, 2012 | Author: Matthew D. Weidner, Esq.


Just today a massive lawsuit was filed in Broward County that has extraordinarily significant national implications. Now, first things, first. Allegations in lawsuits are not facts…not until a finder of fact confirms that the allegations alleged are true. But having said that, many of the base factual statements in this lawsuit regarding the underlying transaction wherein a lawyer in Florida sold the essential parts of an operation whose purpose was to throw Floridians out into the street are facts that are already part of many filings with the Securities and Exchange Commission. For more about those statements, read what I wrote more than a year ago about it here.

So I read the prospectus a long, long time ago and realized this was bad, bad news. I screamed loud and hard about it.
But no one listened. I read the prospectus over and over and it just blew my mind….I recognized that this was not going to end well for my profession or for the court system that I took an oath to defend and protect.

Now, I could care less about investors….my interest was then and is now, the protection of Floridians who were victims of this operation and importantly, I was terribly concerned about the long-term implications for this state’s court system and the dramatically negative impact this transaction was going to have on the profession of law. The public already held lawyers in low regard and this entire operation was set up to give my profession a much bigger black eye than it already had.

I screamed and argued in my cases, and to the credit of a great many good judges…most of them here in the Tampa Bay area, they caught on real quickly….they listened…and my clients were protected. But too many other people would not listen. Who was I after all….just some street fighting consumer lawyer that had developed a passion for sticking up for the little guy. And since then, “our” court system has been choked by the chaos I warned about so long ago.

But enough about then and what should have been. Read carefully the allegations that are being made from the insiders in the transaction where a lawyer essentially sold a law office to a group of investors. But before you do, remember:

1) This lawyer had been the target of a major class action lawsuit filed in Federal Court in 1999.

2) Fannie Mae and Freddie Mac are taxpayer dependent organizations.

3) Fannie Mae and Fredie Mac were aware of the problems with David J. Stern.

4) Fannie/Freddie are misleading the public about how much their malfeasance will cost.

5) Every man, woman and child in the entire USA will pay dearly for Fannie and Freddie’s malfeasance.

So this is all very much every one of our business….after all, we’re all going to be paying for it for our entire lifetimes. And this is not just a Florida problem….every single taxpayer in America will be paying for this so you’re bought into this problem. So the questions we all need to be asking as taxpayers, as voters, as the people who are picking up the tab for all of this are….who knew about all of these allegations and how long did they know about them?

And now for the allegations, taken directly from the complaint:

The instant action arises from fraudulent misrepresentations and omissions made by Defendants, Stern, DSI, PTA andDS Law (the “Seller Defendants”) to induce DJSP to purchase the non-legal mortgage foreclosure processing and support serviceoperations of DS Law

After the real estate market crashed in 2008, the Seller Defendants’ law business boomed with DS Law’s mortgageforeclosure caseload rising from 15,000 in 2006 to 70,400 in 2009. In 2009, DS Law handled approximately 20% of all repossessionsin the State of Florida. The Seller Defendants’ largest clients included Fannie Mae, Freddie Mac, Citibank, Bank of America, GoldmanSachs, GMAC and Wells Fargo. Indeed, the Seller Defendants’ clients included all of the top 10, and 17 of the top 20, mortgageservicers in the U.S

The associated Target Business also enjoyed exponential growth as a result of the real estate market crash, and, in2009, the Target Business reportedly brought in a purported $260 million in revenues. However, as more fully explained below, theSeller Defendants fraudulently and artificially inflated the revenues of the Target Business and concealed material information regardingthe unlawful foreclosure practices of DS Law to induce DJSP and DAL into purchasing the Target Business

The Seller Defendants fraudulently induced Plaintiffs DAL and DJSP into entering into the Transaction by fraudulentlyand artificially inflating the Target Business’ actual revenues, by intentionally failing to disclose that the Target Business and DS Lawwere not, in fact, operating in accordance with all applicable laws, and by concealing that DS Law was in jeopardy of losing its largestclients due to DS Law’s unlawful conduct. Indeed, before entering into the Transaction, the Seller Defendants knew that DS Law and theTarget Business had been systematically falsifying and/or back-dating pertinent legal documents, submitting such documents to thecourts, routinely misplacing and losing original key documents, filing foreclosures with inaccurate and/or incomplete documents,prosecuting foreclosure cases without obtaining proper service of process, and were in jeopardy of losing the Seller Defendants’ largestforeclosure clients due to such conduct.

By cutting corners in the foreclosure process without following the rule of law, the Defendants artificially reduced theexpenses of the Target Business which falsely inflated the profitability of the Target Business.

To summarize, the Seller Defendants failed to disclose to DJSP and DAL that DS Law and the Target Business weresystematically operating in an unlawful manner. In addition, the Seller Defendants failed to disclose to DJSP and DAL that the TargetBusiness’ reported revenues were not accurate, inflated, and improperly calculated and that the expenses of the business were alsodistorted due to the systematic practices designed to “shorten” the legal process. The Seller Defendants falsely led DAL and DJSP tobelieve that they were acquiring a long-term profitable business that operated in accordance with all applicable laws to induce DAL andDJSP to enter into the Transaction.

The Seller Defendants’ fraudulent and illegal foreclosure practices prior to the Transaction, and the subsequent demiseof the Seller Defendants’ law practice, have now been well documented and reported upon in the local and national media.
Prior to the Transaction, the Seller Defendants were at all times well aware that DS Law and the Target Business were intentionally perpetuating a fraud on the courts by, inter alia, systematically filing forged documents, forging signatures on suchdocuments, fraudulently backdating documents, improperly notarizing and witnessing documents, fabricating documents, signingaffidavits without reviewing or verifying the information contained therein, prosecuting foreclosure cases without obtaining properservice of process, and filing foreclosures with inaccurate and/or incomplete documents.
Indeed, the Seller Defendants directed employees of DS Law and the Target Business to purposefully overlook glaringinaccuracies in foreclosure pleadings and to essentially rubber stamp computer generated documents without reviewing or verifying theaccuracy of the documents.

New attorneys at DS Law were not only encouraged, but were even ordered to sign legal filings andpleadings without reading them. As a result, false and inaccurate documents were routinely executed and filed with the courts in aneffort to hasten foreclosure proceedings and illegally obtain final judgments of foreclosure for the Seller Defendants’ clients.
The Seller Defendants even incentivized these unscrupulous and unlawful practices by giving their employees bonusesand extravagant gifts for churning out the highest number of foreclosure cases in the least amount of time. The Seller Defendantsencouraged contests between DS Law attorneys to see who could jam a foreclosure case through the courts the fastest.
Prior to the Transaction, the Seller Defendants also knowingly and systematically inflated their process of servicecosts to the Court. Specifically, Seller Defendants engineered a fraudulent scheme whereby they directed their process servicing work toa process servicing company called ProVest. The Seller Defendants caused each file to generate four or five separate fees for service of process regardless of whether service of process on multiple defendants was necessary or appropriate and regardless of whether serviceof process for multiple defendants could be achieved at the same address.
In exchange for receiving these inflated service of process fees, ProVest, in turn, routinely referred back to PTAservicing requests for “skip tracing” to locate defendants for whom ProVest purportedly did not have accurate street address informationto effect service of process. ProVest “hired” and paid fees to PTA for “skip tracing” services despite the fact that ProVest had theability and resources to perform “skip tracing” itself and routinely did so itself.
The Seller Defendants’ arrangement with ProVest amounted to a kickback scheme. DS Law padded and inflated itsprocess servicing costs which were billed to its clients and added to the court costs assessed to foreclosure defendants. In exchange forfeeding this work to ProVest, PTA earned manufactured “skip tracing” fees which inflated PTA’s revenues and profits and whichrepresented another way in which the Seller Defendants artificially inflated the revenues of the Target Business prior to the Transaction.
In short, prior to the Transaction, the Seller Defendants and the Target Business routinely and systematically engagedin illegal and unfair and deceptive business practices. The Seller Defendants were well aware that such conduct severely threatened theviability of its valuable continuing relationships with their primary revenue generating clients, such as Fannie Mae, Freddie Mac, andCitibank, which, in turn, threatened the continued viability and existence of DJSP.
None of these illegal business practices were known to DJSP or disclosed by Seller Defendants to DJSP prior to theTransaction.

In fact, the Seller Defendants purposefully concealed such deceptive and systematic practices, and made numerousfalse representations regarding the revenues and propriety of the Target Business’ operations with the specific intent to fraudulentlyinduce DJSP into entering into the Transaction.

The Seller Defendants’ unlawful and negligent business practices spawned investigations by the Florida AttorneyGeneral’s Office, which, in August of 2010, announced its investigation of DS Law regarding its handling of foreclosure paperwork andcourt filings. Soon thereafter, DS Law’s largest clients, Fannie Mae, Freddie Mac and Citibank, began pulling their cases from DS Law,resulting in DJSP’s rapid decline.

Moreover, in early March, 2011, DS Law announced that it was ceasing the practice of law with respect to all pendingforeclosure matters in the State of Florida effective March 31, 2011.

DS Law’s demise has directly and necessarily resulted in the destruction of DJSP’s business. It has forced DJSP tolayoff hundreds of employees and has caused its revenues to plummet.

Stern was fully aware of and failed to correct the illegal, unethical, and unfair practices that were a systemic part of DS Law.
Despite his professional obligations as an attorney and member of The Florida Bar, Stern knew that the SellerDefendants engaged in a systematic practice of fraudulently, negligently and unethically prosecuting its clients’ foreclosure cases, andStern failed to implement any preventative or corrective measures to “reasonably ensure” that such conduct no longer took place beforeor after the Transaction.

Stern failed to conduct DS Law’s practice in accordance with the laws of the State of Florida and the regulations of The Florida Bar and failed to ensure that DS Law sufficiently supervised DJS LLC’s performance of its non-legal foreclosure related services.

As such, Stern was professionally reckless and negligent in discharging his duties both as an attorney and as an officerof DAL, DJS LLC and DJSP






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EDITOR’S ANALYSIS: Like many other  AG’s around the country, Bondi in Florida came to the realization that the Bank’s money is not nearly as valuable as actual votes from voters. So after sinking an investigation into the banks and law firms representing the banks, after “losing” a case and deciding not to appeal, she suddenly woke up and decided that an appeal is a good idea. She’s right. I just hope she means it and actually tries to win. The banks have sucker punched the system from the beginning through their manipulation of politicians they own lock, stock and barrel.
WHY SHE IS RIGHT AND THE 4TH DCA WAS WRONG: Before condemning the 4th DCA, we should note that what I am about to say here was not clearly defined before the court and their decision might have been different if they considered these facts.
Ordinarily the appellate court would have been right — lawyers cannot be held accountable for the acts of their clients no matter how despicable the act and no matter what damage is caused. If it were otherwise then all anyone had to do was to accuse someone of a heinous crime and they couldn’t get a lawyer. That was the old system in France and other places where the mere accusation was enough to put someone in prison for the rest of their life. Check out the novel by Dumas on the escapee from the fictional Chateau D’If for a lesson in criminal procedure in the old days.
This is different because the law firm was not acting as a law firm. It was the agent of evil, funded, controlled and staffed and equipped by the Banks. Stern’s job, like Baum in New York, Tiffany and Bosco in Phoenix et al was very clearly defined: they were to do nothing. And for doing nothing they were rewarded with tens of millions of dollars, even hundreds of millions of dollars — as long as they stayed out of the way. These people and their law firms were never hired by the Banks — they were bought, or at least rented.
The investigation and prosecution of these law firms is required because without it, the realities of the foreclosure crisis will never be known — specifically that the entire securitization scam was followed by a foreclosure scam which in turn is being followed by a re-sale scam — all  in violation of civil and criminal laws of each state.
Virtually none of the homeowners were rightfully foreclosed. In all such cases the homeowners still own their homes and are capable of reclaiming them. They just don’t know it. And an actual investigation will reveal that very fact. Fringe conspiracy thinking you say? Look back to my prior posts. From 2007 to 2009 I stated and predicted things that put me on the far edge of credibility. Now they are all accepted as true.
Stern’s license was rented by non-lawyers. Violation number 1. The Banks arranged to practice law at the Banks direction using the bank’s system of distribution of cases and the Bank’s script as to what to do, say, plead and escape having to prove anything. That is practicing law without a license. Violation number 2.
In order to cover-up the fact that securitization never happened, that the bank’s were never at risk of loss on any mortgage, that the Banks were not taking any losses and therefore were never entitled to receive one penny of bailout, Stern’s firm was used as a fabrication factory (violation number 3) for documents that were back-dated (violation number 4), forged (violation number 5) and notarized without complying with legal requirements for the signatory or the witnesses (violation number 6).
Stern was out on his yacht. His argument is that while he knows it was wrong, someone else would have done it so he thought why should someone else get all that money for doing nothing? He will further argue that since we wasn’t there he could hardly be charged with crimes committed in his absence. We’ll see about that.
Under direction of the Banks lawyers were sent to court with lies of the Bank and they failed to exercise the slightest bit of due diligence to determine whether there was an arguable basis for the facts they proffered. Violation number 7. They were just following orders. Violation number 8. Orders received from non-lawyers. Violation number 9.
If Banks can get away with hiding their criminal acts behind the cloak of a law firm they bought or rented, then so can anyone. And THAT is the problem with the 4th DCA opinion that the lawyers were not engaged in commerce. The Court had it reversed.
The law firm was not involved in the practice of law. Just as the closings were cloaked as mortgage loans when they were in actuality vehicles for the issuance of fraudulent securities, the use of law firms in court was a cloak for the fact that none of the elements of a valid mortgage, much less a mortgage foreclosure were present. The Banks used lawyers to deliver the false message and in many cases used non-lawyers who pretended they were lawyers when they got on the phone with homeowners or homeowners’ attorneys.
Just as they “borrowed” the law license of hundreds of lawyers across the country, they borrowed the loss of the investors in those bogus mortgage bonds and claimed it as their own — thus bidding in property with a credit bid instead of cash. It would be bad enough if they bid low, but in cash as they might have done if they had any notion of conforming to the requirements of law.
No, they wanted it for nothing and they successfully implanted the message that any borrower who defended against this criminal acts was asking for a house for nothing when in most cases all they wanted was a modification or settlement that would have saved the nation from economic crisis that is still growing and heading for another collapse bigger than the last and most recent one.
In short, they stole the homes quite literally. They could not do this without absolute power and control over what appeared to be a law firm but in actuality was a clerical company whose law license was incidental to the main enterprise, to wit: fraud on the courts, the investors and the borrowers. BIG VIOLATION NUMBER 10 WORTH TRILLIONS OF DOLLARS.
Yes all this sounds far-fetched but I think Reynaldo Reyes of Deutsch said it best when his guard was down — “it’s all very counter-intuitive.” Translation: It’s all a lie and we are living with it.

Bondi to appeal court ruling that shields attorneys from foreclosure fraud investigations

Plagued by accusations that she hasn’t done enough to combat foreclosure fraud, Attorney General Pam Bondi’s office announced today that she will fight a court decision that prohibits her from going after attorneys. In April, the state’s 4th District Court of Appeals ruled that Bondi does not have the authority to investigate a law firm for alleged fraud under the Florida Deceptive and Unfair Trade Practices Act because attorneys’ work on behalf of lenders did not constitute trade or commerce. The attorney general chose not to appeal.
Two weeks ago, that same court issued a similar opinion in a second case, this time involving the now-defunct Law Offices of David Stern, P.A. Bondi filed a motion today that will allow her to appeal that decision to the state Supreme Court. In the months between the two rulings, Bondi faced a heap of criticism concerning her office’s approach to foreclosure fraud. She was skewered in July for forcing the resignations of two attorneys leading foreclosure fraud investigations.
At the height of the controversy, Bondi agreed to appoint an independent inspector general to look into the matter and two Democratic legislators asked the federal government to open an inquiry. A few weeks later, assistant attorney general Andrew Spark released a long, critical essay accusing the office of failing to aggressively pursue foreclosure and consumer protection cases, then he quit the next day. Bondi attributed much of the criticism to politics and disgruntled ex-employees, and said her office has increased the number of staff assigned to investigating foreclosure-related cases compared to former Attorney General Bill McCollum.
Her office said today that there are six pending investigations into law firms for potential misconduct in foreclosure cases. State Sen. Eleanor Sobel, D-Hollywood, has been one of Bondi’s most vocal critics this year. But she welcomed the news that the attorney general is taking new steps to go after attorneys. “I think she’s seen the light,” Sobel said. “It’s about time.” To read Bondi’s motion, click here.Read more here:


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EDITOR’S NOTE: This is exactly the result you can expect when you allow anyone to play the part of the creditor and submit a “credit bid” (no money at auction) or selling the house on a short-sale, pretending that they can execute a satisfaction of mortgage when they can’t. And this is exactly the problem that is going to get increasingly complex as the title records are revealed to have just as many problem — in fact exactly as many problems as the foreclosure and mortgage problems in so-called securitized loans that were never actually documented and securitized.

Contrary to what you will hear elsewhere, this is neither an isolated instance nor a situation that can distinguished from ALL the other foreclosures, sales, auctions, etc. stemming from the table-funded loans violating TILA, violating RESPA, violating the securities laws, based upon appraisal fraud, and using dummy entities as “bankruptcy remote” vehicles to ACT as creditors.

If your loan was the subject of a securitization attempt, whether successful or not, it is my de finite opinion to all lawyers that you look at the issue of clouded title, defective title and unmarketable title. I don’t think there is a title company in existence, unless it is owned or controlled by the pretender lenders, that will issue a title policy on any of the tens of millions of properties that were subject to so-called loan or possibly security transactions. You can check it out for yourself.


Stern’s foreclosure mistake leads two to buy same house

Paperwork error complicates home sale, raises questions about process

By Diane C. Lade and Doreen Hemlock, Sun Sentinel5:00 p.m. EST, December 4, 2010


Real estate investor Marjorie Oster was pleased when she snagged what looked like a good deal through a Miami-Dade County foreclosure court auction: a four-bedroom house in Cutler Bay, with a swimming pool, for about $95,000.

But when her husband drove by the next day to check on the property, he saw “someone cleaning the pool, a lawn service cutting the grass and a note it was being tented for termites,” said Oster, a Miami resident who has been in real estate for 15 years.

It turns out the house she thought she had purchased had been sold in a short sale the week before to someone else — Osberto Jimenez, a 40-year-old Cuban-born truck driver. The law firm handling the foreclosure for the lender mishandled the paperwork and never canceled the auction sale.

“So we both own the same house and I’m frustrated as hell,” said Oster. “Someone screwed up.”

New attorneys representing CitiMortgage say that “someone” was David Stern’s beleagured law office, which originally represented the lender. Citi ultimately pulled the case from Stern’s offices and gave it to Shapiro and Fishman, another large South Florida foreclosure firm that represents banks and loan servicers.

Both law offices, along with two others, are under investigation by the Florida Attorney General. They’re accused of engaging in shoddy pratices, including fabricating documents. Shapiro and Fishman has defended its practices and said it did nothing wrong. Jeffrey Tew, the attorney representing Stern, declined to comment.

Stern, who at one point claimed he processed 20 percent of the state’s foreclosures through a staff of more than 1,000, has been forced to lay off the vast majority of his employees as his biggest clients continue to abandon him. Citi spokesman Mark Rodgers declined to comment specifically on the Cutler Bay double sale, but said the company stopped referring new foreclosures to Stern in September and now has removed all of its business from the firm.

Federal lawmakers, listening to testimony at a Senate Banking Committee hearing this week, said ongoing and widespread problems with loan servicing and foreclosures indicated a “significant weakness” in the entire system. Attorneys general in 50 states continue to investigate reports of servicers and foreclosure firms like Stern’s “robo-signing” hundreds of thousands of affidavits without reviewing them.

“We are seeing more instances of mistakes being made,” said Darryl Wilson, a professor and real estate expert at Stetson University‘s College of Law. “That’s why you keep seeing moratoriums [on foreclosures] coming up.”

At Wednesday’s Senate hearings, some federal regulators urged mortgage guarantors Fannie Mae and Freddie Mac to suspend foreclosure proceedings while homeowners looked for new mortgages or tried to work out loan modifications.

In the situation with the Cutler Bay house, attorney Leora B. Freire, with Shapiro and Fishman, said Stern’s office didn’t notify the courts to take the house out of the foreclosure auction after the short sale had been processed.

Oster and Citi reached an agreement Wednesday, Freire said, vacating Oster’s sale, which allows Jimenez to keep the house. Oster said she would be refunded her money, paid some interest, and have her legal fees covered.

Documents show Oster bought the property for cash on Oct. 6 and received a certificate of title. Seven days earlier, Jimenez executed a warranty deed and took out a $123,000 mortgage in a short sale approved by CitiMortgage and the previous owners.

The tsumani of negative news about Stern’s operation had Oster fearing she never would see her money again. She said she contacted the office numerous times for more than a month, but attorneys either would never return her calls or couldn’t tell her what had happened to her payment.

“I just wanted out because it was David Stern’s firm,” she said.

Mortgage giants Fannie Mae and Freddie Mac, who comprised the majority of Stern’s referrals, pulled all of their cases from the firm over the past two months. Shapiro and Fishman, however, remain on Fannie’s referral list.

Darryl Wilson, a professor and real estate expert at Stetson University’s College of Law, said that while selling the same house twice was “quite strange,” it does happen – and increasingly more so lately, as lenders, attorneys and the courts scramble to push a huge number of foreclosures through the pipeline. “There needs to be a lot more diligence and patience in dealing with these cases,” he said.

While there is no specific statute addressing double sales, Wilson said basic common law suggests that the first person buying the property would have the first rights to it. But the outcome could vary according to the specifics in each case, Wilson said.

Jimenez, who came from Cuba five years ago, said he always assumed he would get to keep his home because he bought it first. He already has started renovating the kitchen, and has decorated the front yard with holiday lights.

“I knew things would get resolved. I did everything legal,” he said.

Diane Lade can be reached at or 954-356-4295.


Hey Dave, that thing in your throat is called an order of disgorgement.

Posted on02 November 2010. Tags: , , , , , , , , , ,


Fannie, Freddie Take Loan Files From Florida Law Firm


Fannie Mae and Freddie Mac have terminated their relationships with a top Florida foreclosure law firm and began taking possession of loan files on Monday afternoon from the firm, which processes evictions on behalf of the mortgage-finance giants.

Fannie and Freddie had previously suspended all foreclosures that had been referred to the law offices of David J. Stern in Plantation, Fla., a suburb of Fort Lauderdale.

Freddie Mac took the rare step of removing loan files after an internal review raised “concerns about some of the practices at the Stern firm,” a Freddie spokeswoman said.

“We have begun taking possessions of all files on Freddie Mac mortgages simply to protect our interest in those loans as well as those of the borrowers,” the Freddie spokeswoman said. A Fannie spokeswoman declined to elaborate.

Fannie and Freddie said they will move those files to other law firms in the state but that they hadn’t yet identified where they would be redistributed. The firms said they had notified Florida’s attorney general about the decision to remove the files and that the Stern firm had cooperated with the action.

A lawyer for Mr. Stern didn’t immediately respond to inquiries.

© 2010 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.

Rep. Alan Grayson of Florida asks Fla Supreme Court to halt all foreclosures


* How Serious is the GMAC Problem? Pretty Serious and Not Just GMAC – 09/21/2010 – Yves Smith
* Steve Keen: Deleveraging With a Twist – 09/21/2010 – Yves Smith

Monday, September 20, 2010

Grayson Calls on Florida Supreme Court to Halt Foreclosures

Representative Alan Grayson of Florida has asked the Florida Supreme Court to halt all foreclosures in the state in light of an investigation by its attorney general into allegations of pervasive foreclosure fraud by so-called “foreclosure mills”.

Text below:

September 20, 2010

Chief Justice Charles T. Canady
Florida Supreme Court
500 South Duval Street
Tallahassee, FL 32399-1900

Dear Chief Justice Canady,

I am disturbed by the increasing reports of predatory ‘foreclosure mills’ in Florida. The New York Times and Mother Jones have both recently reported on the rampant and widespread practices of document fraud and forgery involved in mortgage assignments. My staff has spoken with multiple foreclosure specialists and attorneys in Florida who confirm these reports.

Three foreclosure mills – the Law Offices of Marshall C. Watson, Shapiro & Fishman, and the Law Offices of David J. Stern – constitute roughly 80% of all foreclosure proceedings in the state of Florida. All are under investigation by Attorney General Bill McCollum. If the reports I am hearing are true, the illegal foreclosures taking place represent the largest seizure of private property ever attempted by banks and government entities. This is lawlessness.

I respectfully request that you abate all foreclosures involving these firms until the Attorney General of the state of Florida has finished his investigations of those firms for document fraud.

I have included a court order, in which Chase, WAMU, and Shapiro and Fishman are excoriated by a judge for document fraud on the court. In this case, Chase attempted to foreclose on a home, when the mortgage note was actually owned by Fannie Mae.

Taking someone’s home should not be done lightly. And it should certainly be done in accordance with the law.

Thank you for your consideration of this request.


Alan Grayson
Member of Congress

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