Wednesday, November 21, 2012

Two Original “WET INK” Notes Discovered in Same Foreclosure Case – Beth Cottrell JPMorgan Chase Team – 18,000 Documents a Month!

As the writer of this post states, we have had our suspicions of fraudulently created original "wet ink" notes as well - especially when the note is lost for 6-18 months, then suddenly appears and is presented to the Court, or where we get multiple copies of the purported same allonge but the endorsements are in different places, sometimes the allonges are even on different bank letterheads (!)(First National Bank of Arizona / Nevada).

As noted in the story, GMAC has referred to this in court as a "technical" problem.  No, it is not.  It is blatant fraud.  Yet, when we have presented this evidence in court, often the case was dismissed as the Court asserts that the homeowner cannot file a suit and raise the issue on a "suspicion."  A suspicion?  Really?  This is how you catch people when they commit fraud - you have a good faith basis to assert they are committing fraud, you sue, you investigate, and maybe its true, maybe its not, but you get to find out because the court wants to know (or it should).

We stay hopeful that the approach of the courts to these documents (fraudulent assignments, allonges and endorsements on notes) continues to shift towards justice.

Guilty Pleas in Foreclosure Fraud Cases by DocX Founder - the document prep company used by banks


From the Article comes this quote:

"We are sending a signal to the financial industry that these mortgage documents have meaning, they are legal documents and if you are going to file them in the courthouses of this country then they had better be honestly drafted," said Chris Koster, the Missouri attorney general.

And this:

"If citizens had filed these types of documents with a bank in an attempt to get a loan, the banks would have filed criminal cases against them," Mr. Koster said. "The mortgage servicing industry has to be held to the same standard that the banks hold the rest of us to."

Truer statements could not be made.  At BB&B we have been raising those very issues for five years with the courts.  Simply, an entity may not used fraudulent documents as the basis to take someone's home.  Yet, all too often this fraud is overlooked in an effort to protect creditors.  But that is the point, if the documents are fraudulent, there is no evidence that the foreclosing entity is, in fact, the creditor.

Further, the rule of law must prevail over the inconvenience of a foreclosure that must be overturned, or denied prior to occurring.  When the rule of law does not prevail, our system of justice is tainted.  

Thursday, November 8, 2012

Secret Documents Show Weak Oversight of Key Foreclosure Program

Pro Publica is doing incredible work - the hard work none of us wants to / can do.  Once again, they expose the inherent problems of having the fox guard the henhouse.

Asking why it is done that way is an entirely different question.

Read more at the link for more depressing goodness.


Wednesday, November 7, 2012

Why Mortgage-Backed Securities Aren't (Backed by Securities): How MERS Toasted the Banks

MERS and the mortgagebacked-securities

Great article from December 2010 - so much of this has come to light since.

The Bailout of AIG: Mission Accomplished?


Yes, Virginia, Servicers Lie to Investors Too: $175 Billion in Loan Losses Not Allocated to Mortgage Backed Securities (and Another $300 Billion on the Way)


Just In | FDIC Sues JPMorgan, Citigroup, BofA Securities, Deutsche Bank


FDIC Sues Major Banks for $2.1 Billion that Pushed and Sold Residential Mortgage Backed Securities with False Statements About Quality


Wells Fargo Wachovia Unit Faces Probe Over Mortgage Practices


Eurozone Composite PMI October 2012: Eurozone Economy Endures Worst Month Since June 2009


Massachusetts Senate Race 2012: Warren Win Is Big Wall Street Loss


Wall Street Must Rebuild Obama Ties In Face Of Stricter Financial Regulation After Election Win


Monday, November 5, 2012

Australian Judge rules Standard & Poor, the credit rating agency, misled investors with AAA ratings, the case will proceed


In a 1,500 page opinion, a judge in Australia has ruled that a lawsuit against the rating agency, S&P, will go to trial.  This is the first of its type to survive, with those cases filed in the US usually dismissed on grounds that the ratings are merely the credit rating agency's exercising their First Amendment rights.

As noted in the article:

"The 1,500-page ruling marks the first time a rating agency has stood a full trial over a structured finance product. The decision will be closely studied by rival rating agencies and also by investors and investment banks around the world."

Keep an eye on this one.

Sunday, November 4, 2012

Thursday, November 1, 2012

Mortgage Fraud - the Crime of the Century

While this article really says nothing new, it sheds light on the elephant in the room, which was a major cause of the financial crisis (coupled with massive deregulation thanks to lobbying by those same banks and the Federal Reserve's policy of keeping interest rates low during the bubble): the massive amount of fraud lending institutions engaged in during the peak of the housing bubble (2004-2006). 

The claim that no one saw this coming is nonsensical.  Yet, it is repeated still today.  This helps the reader understand why those claims need to be shut down.  At some point, "truthiness" (a fabulous term coined by Stephen Colbert) has got to end, the truth has to be acknowledge, and people need to go to jail.  Period.

Check out the article on here:


Thursday, October 25, 2012

Why Freddie Mac Resisted Refis


One day .. perhaps years, even decades from now, someone will connect the dots:

The problem is not merely that it was the industry standard to bet against securities your institution issued, or that the small number of institutions that are able to participate in the REMIC world (real estate investment conduit) - Wells Fargo, Deutsche Bank, Bank of America, JPMorgan Chase, Citibank - are involved in a huge incestuous game of musical chairs concerning "who can generate more servicing fees for serving as trustee / custodian / master servicer" for the REMIC pools, or that loan originators were pushed to get the worst loans possible (often targeting minorities), or that regulators turned a blind eye to this huge shell game.

The problem that will be revealed is that the web of interconnectedness - the thing that scared everyone so badly when Lehman exploded - is more dense and interconnected than anyone admits, but in truth no one has any idea just how interconnected it all is. 

Why? Once bank A creates and sells exotic instrument 1 to B, which is not tracked on an exchange, B sells it to C, who sells it to D -- all the while A has no idea where it went down the alphabet. 

At the same time investor / institution / bank C creates exotic instrument 2 made up of assets which include some/all of instrument 1 created by bank A, which are in turn sold to and become part of instrument 3, and bank D creates instrument 4 which is made up of bets against instrument 1 (which also means instrument 2), and then A buys instrument 5, which is made up of parts of instrument 4, which unknown to A is made up of bets against instruments 1 & 2, and so on and so forth, to the point where no one knows where they stand or what they own or even if they are holding bets against other instruments they hold.

Thus, the reference to this being one huge ponzi scheme.  A casino, but worse.

This is Freddie Mac's problem.  They insure the loans, but stand to profit from the exotic instruments it holds -- you cannot collect a credit-default swap if the loan(s) do not default.  This is the disconnect, the incentive problem which explains why servicers, Fannie, Freddie, et al. are not "trying" to assist homeowners.  In fact, this explains why it is more likely the opposite - and the facts support that, even if the words they speak suggest otherwise.

Wells Fargo’s Directors Ordered to Face Foreclosure Claims

From the article:

"U.S. District Judge Susan Illston in San Francisco rejected Wells Fargo’s request to dismiss shareholders’ allegations that directors wrongfully failed to disclose their opposition to a government probe of the bank’s mortgage lending and foreclosure policies."

Now shareholders are suing as those same investigations wold have benefited them and their claims against management.

Fascinating, absolutely correct, and also applies to holders of certificates issued by securitized trusts (that own pools of loans) and their claims against the trustees of the pools (the major banks) and the master-servicers / servicers of the loans (again, the major banks) for how foreclosures were handled as those practices hurt their investments as well. 

Wells Fargo, and several others, did all they could to disrupt the investigations into foreclosure practices leading up to the National Foreclosure Settlement last year.  The banks' efforts to deny investigators access to robo-signers, documents, data, etc., was well documented in the IG reports that can be found on HUD's Website

Wells Fargo has agreed to pay $175 million to settle allegations that it discriminated against minority borrowers, the Department of Justice announced Thursday.


Tuesday, October 23, 2012

Friday, October 19, 2012

Thursday, October 18, 2012

Ex-Tarp Watchdog gives Wall Street Reforms an "F"

Washington's one major shortcoming: failing to reign in Wall Street, no prosecutions of high level bank officials, and watered down reforms.  While Barofsky points to Obama, Congress has a lot to do with this as well, if not more.


Saturday, September 29, 2012

Nothing new here. Just another multi-billion $ settlement.

Bank of America's Merrill Lynch Settlement: Company Puts Charges Of Misleading Investors Behind It: via HuffPost

Monday, September 17, 2012

This article makes the "do-not-miss" list. This means you should read it.

Four Years After the Financial Implosion, Questions Finally Begin to Be Asked: (from Huffpost)

Thursday, September 13, 2012

The Federal Reserve will buy $40 billion* of mortgage bonds EACH month

Talk about a bailout!  $40 billion each month for as long as the economy needs it.  Keep in mind, the Federal Reserve could use that money to help "people" ... rather, it will spend hundreds of billions in dollars to "save" banks.  It will not save them.  Even if it did, it does not save anyone but the banks.  At least a handful of people will make a LOT of money.

Fed Announces more "quantitative easing"

*Correction, $85 Billion / month until the end of this year, then $40 Billion / month until the economy has fully stabilized.