BANKS EDGE CLOSER TO THE ABYSS

I wish VT Judges had this knowledge , like the ones here and in NY.

For the second time in as many weeks a trial judge has ordered the pretender lender to execute a permanent modification based upon the borrowers total compliance with the provisions of the trial modification.This time Wells Fargo (Wachovia) was given the terms of the modification, told to put it in writing and file it. If they don't sanctions will apply just as they will be in the Florida Panhandle case we reported on last week.

Remember that before the trial modification begins the pretender lender is supposed to have done all the underwriting required to validate the loan, the value of the property, the income of the borrower etc. That is the responsibility of the lender under the Truth in Lending Act.

Of course we know that cases were instead picked at random with a cursory overview simply because there was no intention to ever give a permanent modification. Borrowers and their attorneys have known this for years. Government, always slow on the uptake, is starting to get restless as more and more Attorneys General are saying that the Banks are not complying with the intent or content of the agreement when the banks took TARP money.

The supreme irony of this case is that Wells Fargo didn't want the TARP money and was convinced to take it and accept the terms of HAMP because if only the banks that really need it took the money it was argued that this would start a run on the banks named that had to take TARP. The other ironic factoid here is that the whole issue of ownership of the loans blew up in the face of the government officers around the country that thought TARP was a good idea --- only to find out that the "toxic assets" (TARP - "Toxic Asset Relief Program") were not defaulting mortgages.

1. So instead of telling the banks they were liars and going after them the way Teddy Roosevelt did 100 years ago, they changed the definition of toxic assets to mean mortgage bonds.
2. This they thought would take care of it since the mortgage bonds were the evidence of "ownership" of the  "underlying" home loans.
3. Then the government found out that the mortgage bonds were not failing, they were merely the subject of a declaration from the Master Servicer (a necessary and indispensable party to all mortgage litigation, in my opinion) that the value of the bond had fallen ,thus triggering payment from insurers, counterparties on credit default swaps etc to pay up to 100 cents on the dollar for each of the bonds ---
4. which means the receivable account from the borrower had been either extinguished or reduced through third party payment.
5. But by cheating the investors out of the insurance money (something the investors are taking care of right now in the courts), they thought they could keep saying the loans were in default and the mortgage bond had been devalued and thus the payment of insurance was legally valid.
6. BUT the real truth is that the loans had never made into the asset pools that issued the mortgage bonds.
7. So the TARP definitions were changed again to "whatever" and the money kept flowing to the banks while they were rolling in money from all sides --- investors, insurers, CDS counterparts, sales of the note to multiple asset pools (REMICs) and then sales of the note to the Federal Reserve for 100 cents on the dollar.
8. This leaves the loan receivable account in many cases in an overpaid status if one applies generally accepted accounting principles and allocates the Federal, insurance and CDS money to the bonds and the "underlying" loans.
9. So the Banks took the position that since the money was not coming in to cover the loans (because the loans were not in the asset pool that issued the mortgage bond and therefore the mortgage bond was NO evidence of ownership of the loan) that therefore they could apply the money any way they wanted, and that is where the government left it, to the astonishment and dismay of the the rest of the world. that is when world economies went into a nose dive.

The whole purpose of the mega banks in in entering into trial modification was actually to create the impression that the mega banks were modifying loans. But to the rest of us, the trial modification was supposed to to be last hurdle before the disaster was finally over. Comply with the payment schedule, insurance, taxes, and everything else, and it automatically becomes your permanent modification.

Not so, according to Bank of America, Wells Fargo, Chase, Citi and their brothers in arms in the false scheme of securitization. According to them they could keep the money paid by the borrower to be approved for the trial modification, keep the money paid by the borrower to comply with the terms of the trial modification and then the banks could foreclose making up any excuse they wanted to deny the permanent modification. The sole straw upon which their theory rests is that they were only obligated to "consider" the modification; according to them they were NEVER required to make it such that the modification would become permanent unless the bank expressly said so, which in most cases it does not.

When you total it all up, the Banks received a minimum of $2.50 for each loan "out there" regardless of who owns it. Under the terms of the promissory note signed by the borrower, that means the account is paid in full and then some. If the investor has not stepped up to file a competing claim against the borrower's new claim for overpayment, then the entire overage should be paid to the borrower.

The Banks want to say, like they did to the government, that the trial modification is nothing despite the presence of an offer, acceptance and consideration. To my knowledge there are at least two judges in Florida who think that is a ridiculous argument and knowing how judges talk amongst themselves behind closed doors, I would expect more of these decisions. If the borrower applies for and is approved for trial modification and they comply with the trial provisions, a contract is formed.

The foreclosure defense attorney in Palm Beach County argued SIMPLE contract. And the Judge agreed. My thought is that if you are in a trial modification get ready to hire that attorney or some other one who gets it and can cover your geographical area. Once that last payment is made, and in most cases, the payment is continued long after the trial modification period is officially over, the Bank has no equitable or legal right to deny the permanent modification.

The only caveat here is whether the Judge was correct in stating the amount of principal due without hearing evidence on third party payments and ownership of the loan. WHY WOULD THE BANK WANT LESS MONEY IN FORECLOSURE RATHER THAN MORE MONEY IN A MODIFICATION? The answer is that out of the $2.50 they received for the loan, they would be required to refund $2.50 because the Bank was supposed to be an intermediary, not a principal in the transaction. So the balance quoted by the judge without evidence was quite probably wrong by a mile.

If there is any balance it is most likely a small fraction of the original principal due on the promissory note. And, as we have been saying for years, it is most likely NOT due to the party that is entering into the modification. This last point is troubling but "apparent authority" doctrines might cover the problem.

Every time a loan does NOT go into foreclosure, the Banks' representation of defaults and the value of the loan (in order to trigger insurance and other third party payments)  come under question and the prospect of disaster for the Bank rises, to wit:  refunding trillions of dollars in insurance and CDS money as well as money received from co-obligors on the bond (the finished product after the note was moved through the manufacturing process of a false securitization scheme).

Every time a loan is found NOT to have actually been purchased by the asset pool (REMIC, Trust etc.) because there was no money in the asset pool and that the investors merely have an equitable right to claim the note and mortgage under constructive trust or resulting trust theories, the validity of the mortgage encumbrance fades to black. There is no such thing as an equitable mortgage lien or an equitable lien of any sort. And there is plenty of good sense and many law review articles as well as case decisions that explain why that is true.

151729746-Posti-Final-Judgment-062513

PRACTICE HINT FOR ATTORNEYS: Whether you are litigating or negotiating, send a preservation letter to every possible party or witness that might be involved. That way when you ask for production, they can't say they destroyed or lost it without facing severe consequences. It might even stop the practice of the Banks trashing all documents periodically as has been disclosed in the whistle-blower affidavits from BOA and other banks.

Boa desperate again

WHY ARE THE BANKS FIGHTING TO GET AS LITTLE AS POSSIBLE FROM EACH "FAILED" LOAN?

A drama is playing out in the state of Massachusetts. Bank of America is pretending to be the lender or the authorized servicer or both. But it outsourced the task of dealing with borrowers seeking modification. The company that was used is Urban Lending Solutions (ULS).  A deposition was taken from a knowledgeable source from within ULS.  The attorney  taking the deposition was merely looking for evidence of a script prepared by Bank of America that ULS employees were to follow. Not only was the script uncovered but considerable other evidence suggested institutional policies at Bank of America that were in direct conflict with the requirements of law, and in direct violation of the settlements with the Department of Justice and the banking regulators.

The transcript of the deposition was sealed at the request of Bank of America, which the borrower did not interpose any objection. Now there are a lot of people who want to see that deposition and who want to take the deposition of the same witness and other witnesses at ULS who might reveal the real intent of Bank of America. The question which is sought to be answered is why the mega banks are fighting so hard to take less money in a foreclosure sale then they would get in a modification or even a short sale. The policy is obvious. Borrowers are lured into a hole that gets deeper and deeper so that foreclosure seems inevitable and indefensible. Even after a successful trial modification the banks are turning down the permanent modification, as though they had the power to do so.

Now a number of attorneys are preparing motions to the trial court in Massachusetts to unseal the transcript of the ULS employee. Bank of America is opposing these efforts on the grounds of "confidentiality" which from my perspective makes absolutely no sense. Why would Bank of America share confidential information or trade secrets with a vendor whose only purpose was to interfere with the modification process? My opinion is that the only information that Bank of America wishes to keep secret is that the instructions they gave to ULS clearly show that Bank of America was not interested in anything other than achieving a foreclosure sale in as many cases as possible.

In nearly all cases the modification of the loan more than doubles the prospect of proceeds from the loan and in some cases approaches 100%. Thus the full-court press from the megabanks to go to foreclosure is a mystery that will be solved. My sources from inside the industry together with my own analysis indicates that the reason is very simple. The banks took in money from investors, insurers, counterparties in credit default swaps, the Federal Reserve, the Department of the Treasury and other parties based on the representation of the banks that (A) the banks owned the mortgage bonds and therefore on the loans and (B) there was a loss resulting from widespread defaults on mortgages. Under the terms of the various contracts within the false chain of securitization and the Master servicer had sole discretion as to whether or not the value of the mortgage bonds and the asset pools had declined and had sole discretion as to the amount of the loss caused by the defaults.

As a general rule of thumb, the banks computed value of the collateral at around 25% and therefore received payment to compensate the banks for a 75% loss. They received the payment several times over and then sold the mortgage bonds to the Federal Reserve for 100% of the face value of the bonds. It can be fairly estimated that they received no less than 250% of the principal amount due on each of the loans contained within the asset pool that had issued each mortgage bond. While they had to create the appearance of objectivity by showing a number of the loans as performing, they intentionally overestimated the number of loans that were in default or were in the process of going into default.

Let us not forget that while nobody was looking the Federal Reserve has been "purchasing" the worthless mortgage bonds at the rate of $85 billion per month for a long time and doesn't appear to have any intention of stopping that flow of money to banks that have already received more than 100% of the principal due on the notes. And lest you be confused, the money the banks received should have gone to the investors and should never have been by the banks.

Since the banks received 250% of the principal amount due on the loan, and actual recovery from the borrower of 100% on the loan would leave the banks with a liability to all of the third parties that paid the banks. The refund liability would obviously be 150% of the principal amount due on the loan and the banks would be required to turn over the hundred percent recovery from the borrower to the investors adding to their liability.

But if the case goes through a foreclosure sale, the banks can take a comfortable position that the number of defaults and the depth of the loss was as great as they represented when they took payment from insurers and other third parties. The liability of 250% is completely eliminated. Thus while it might appear to be in the bank's interest to take a 60% recovery from the borrower instead of a 25% recovery from a foreclosure sale, the liability that would be created each time alone was modified or settled would dwarf the apparent savings to the pretender lender or actual creditor.

The mere fact that they went to great lengths to seal the transcript indicates how vulnerable they feel.

PRACTICE MEMO TO FORECLOSURE DEFENSE LAWYERS

As a condition precedent I would suggest that in all cases where we feel the deposition transcript would be helpful I think it would create more credibility if you issued a subpoena duces tecum directed at Urban to produce the witness whose deposition was sealed in the existing case and to bring those records that were requested or demanded at that deposition. One of the questions that needs to be answered is whether the witness witness is still working for Urban, whether the witness has "disappeared", and whether his testimony has changed --- thus we would need the other deposition to test credibility and perhaps get exhibits that BANA either didn't object to, which means they waived confidentiality. If they do not move to quash the subpoena then they might also be arguably waiving the confidentiality objection.

If they do object, you have two bites of the apple --- if they move to quash they must state the grounds other than than it will damage their chances in litigation. The trial court would then hear the objections and of course each if the cases that could benefit from unsealing the deposition results in a hearing, then several judges would hear the same objection. The likelihood is that the objection would attempt to bootstrap the order sealing the deposition as reason enough to quash the subpoena. That in turn puts pressure on the Massachusetts judge to release the transcript.

The more Motions filed the better. So I would suggest that we reach out through media to get as many people as possible with separate motions saying that sealing the deposition is causing a disruption in due process. Since Urban reached out on behalf of BANA --- an allegation that should be made in opposition test the motion to quash the subpoena in each case --- exactly what confidential information needs to be protected? Has the Massachusetts court heard a motion in liming preventing the use of the deposition at trial? If not, then the objection is waived since the Plaintiff will clearly use the deposition at trial, if there is one.

The other issue is that BOA can't simply allege confidentiality rather than strategy in litigation. They must state with particularity what could be possibly confidential. There is no attorney-client privilege, there is no attorney work product privilege.  At first Bank of America disclaimed any knowledge or relationship with ULS.  When it became obvious that the relationship existed and that ULS was using Bank of America letterhead to communicate with borrowers they finally admitted that the relationship existed and then went one step further by alleging confidentiality and trade secrets so that the contract and instructions between Bank of America and ULS would never see the light of day., For a company that BOA disclaimed any knowledge but who used BOA stationery they were clearly an agent of BANA. What exactly could Urban have other than information about modification and foreclosure? I would also notice or subpoena BANA to produce the person who signed the contract with Urban and to bring the contract with him or her. Who received instructions from BOA? Where are those instructions? Were they produced at the sealed deposition.

 If the Massachusetts court does not unseal the transcript, doesn't this give BOA an opportunity for a do-over where they fabricate documents that are different from those produced in the sealed deposition?

What were the instructions to Urban? What was the goal of the relationship between BOA and URban? Where are the scripts now that we're produced in the sealed deposition?

Were the instructions to Urban the same as the instructions to all vendors assisting in the foreclosure process? Why did BOA even need Urban if it had proof of payment, proof of loss,  proof of ownership of the loan? We want to know what scripts were used by Urban and whether the same scripts were distributed to other vendors whose behavior could be plausibly denied. Discovery is a process by which the party seeking it must only show that it might lead to the discovery of admissible evidence. THE POINT MUST BE MADE THAT THE DEFENSE FOR WHICH WE ARE LOOKING FOR SUPPORT AND CORROBORATION IS THAT THE POLICY AND PRACTICE OF BOA WAS TO MOVE PEOPLE INTO DEFAULT BY TELLING THEM TO STOP MAKING PAYMENTS. WE WANT TO SHOW THAT THEIR GOAL WAS FORECLOSURE NOT MODIFICATION CONTRARY TO THE REQUIREMENTS UNDER HAMP AND HARP AND THAT RATHER THAN PROCESS MODIFICATION OR SETTLEMENTS THE POLICY WAS TO DERAIL AS MANY AS POSSIBLE TO GET THE FORECLOSURE EVEN IF IT MEANT THAT THE INVESTORS WOULD GET LESS MONEY? Why?

The instruction was to use the promise or carrot of modification to trick the homeowner into (a) acknowledging BOA as the right party (b) stop making payments causing an apparent default and causing an escrow shortage (c) thus assuring the foreclosure sale despite the fact that BOA never acquired and (d) thus assuring that claims against them from investors (see dozens of law suits against BOA) and from insurers and counter parties on credit default swaps and payments from co-obligors based on the "default" that BOA fabricated --- payments that involved more than the loan itself in multiples of the supposed loan balance.

This is an important battle. Let's win it. There is strength in numbers. We might find the scripts were prepared by someone who used scripts from other banks and that the banks were in agreement that despite the obligations under HAMP and HARP and despite their ,rinses in the AG and OCC settlement, their goal is to foreclose at all costs because if the general pattern of conduct is to settle these loans and make them "performing" loans again it is highly probable that for each dollar of principal that gets taken of the table there is a liability or claim for $10. This would establish that the requirements of HAMP and HARP has resulted in negotiating with the fox while the fox is in the henhouse getting fat.

The Bank Liars begin to fall

Danielle Kelley, Esq.

 I remember sitting at my desk across from my client and telling her we had to resubmit the financial paperwork for a modification with Bank of America.  She held her head in her hands and almost cried.  And I knew how she felt.  She, like I, had submitted financial packets sometimes totaling over 60 pages dozens of times in the past years.  Some clients had to go to local stores and fax the documentation at $1 per page.  Getting the documents in became a part-time job with a stress level that is indescribable.  The only explanation given?  The bank did not get the paperwork.  That was the theme, and most of us bought it.  The idea that Bank of America was so big, with so many offices, and so many different departments makes one think it would be easy for paperwork to get lost, so it gets resubmitted time and again, all to be told “you are not eligible”.

Come to find out, nothing was lost, and it was not a product of negligence, or an inability to keep up with paperwork for such a large corporation.  It was a product of fraud, deceit, greed, and the ability to cheat the American people out of billions in taxpayer dollars without losing a moment of sleep.
Months ago, Senator Warren, blasted those who regulate the banksters like the OCC and SEC for not taking banks to trial.  The reason trial is important is far reaching.  First, trials are public, and the public will be able to hear testimony on what the banks have actually done.  Second, settlements allow the bank to settle for a fraction of their profit, and offer no incentive to abide by the law.  Finally, a settlement looks like someone is actually going after the banks.  But if that were the case, why are we still fighting them?
There is a case going on in Federal Court in Massachusetts titled “IN RE BANK OF AMERICA HOME AFFORDABLE MODIFICATION PROGRAM (HAMP) CONTRACT LITIGATION”.  This case affects more people than those in Massachusetts though as it is a federal class action which involves people from many different states, including Florida.  Long story short, Congress passed the HAMP Program to help homeowners obtain loan modifications.  Bank of America (“BOA”) received 45 billion dollars in government bail-out money in 2009, which required them to participate in the HAMP program.  So they collected the money, but did they participate in the program?
Although the case has not been to trial, testimony has been presented and given.  Declarations have been filed by employees of BOA that paint a horrific scene when it comes to how BOA carried out its HAMP responsibilities.  BOA has asked the Court to seal the depositions taken, and the Court has granted their motion.  As bad as the declarations are, I can only imagine what the depositions might say, and why BOA would want them hidden from public view.
The picture these employees paint is not pretty, and it portrays an entity that will thumb its nose at the very government that gave it billions of dollars, while violating the very Consent Order, Consent Judgment, and National Mortgage Settlement that this very government is holding over its head, yet somehow is not holding its feet to the fire on.  Why BOA is committing these actions is one question.  Why they are not facing accountability by that very government is another.  Attorney General Holder’s comments about “too big to fail” and the fact that prosecuting the big fish could hurt the economy notwithstanding; the issue is more complex.  A program was passed to help homeowners, and given to an entity whom has consistently harmed them.  Without enforcement and regulation, the old dog was not going to learn new tricks.
BOA not only lied to and damaged countless homeowners, but lied to the very government that bailed them out through their HAMP reporting.  They harmed taxpayers, homeowners, their own employees, and created damages we may never be able to truly calculate nationwide.  They will eventually weaken confidence in our economy through their actions which will now become known (again the opposite of what Holder what trying to achieve by his comments).  They will weaken confidence in government officials who won’t hold them accountable.
Here’s a gist of what took place, all from employees of BOA.  Only portions are provided due to length, and I am not providing the names on the affidavits:
A CUSTOMER SERVICE REPRESENTATIVE:
“Bank of America’s practice is to string homeowners along with no apparent intention of providing the permanent loan modifications it promises.  The processes Bank of America uses, and the instructions it gives its employees, appear to be designed to avoid modifying mortgage loans.  I was instructed to inform every homeowner who called in that their file was “under review—even where the computer system showed that the file had not been accessed in months or when the homeowner had been rejected for a modification.  My co-workers and I were instructed to tell homeowners that modification documents were not received on time or not received at all when, in fact, all documents were received on time.  We were also instructed to tell homeowners that documents were sent on a particular date, when they had not been sent at all.”
“During my time at Bank of America, I saw well over a hundred cases in which a Bank of America “analyst” cancelled loan modifications and stated non payment as reason for the cancellation when it was apparent from the computer system that the homeowner had actually made all the required payments.  There was nothing on the computer system to suggest that the analyst’s cancellation was anything but arbitrary.  During my time at Bank of America, I saw records regarding hundreds of homeowners that Bank of America treated dishonestly.  These homeowners were eligible for loan modifications under HAMP, sent back all the required documents and made all their required payments under a trial plan.  Bank of America nevertheless damaged their credit ratings by reporting them delinquent, tacked on additional charges to their loans, increased the amounts it considered as being owed, and often referred these homeowners to foreclosure.” 
CASE MANAGEMENT TEAM MEMBER (PROMOTED FROM UNDERWRITER):
“Bank of America employed a common strategy of delaying HAMP applications.  Delay was achieved using tactics including claiming that documents were incomplete or missing when they were not, or simply claiming the file was “under review” when it was not.  We were instructed to delay and then push homeowners to accept an internal refinance so that Bank of America would profit.  Once an applicant was finally rejected after a long delay, the bank would offer them an in-house alternative.  Bank of America would charge a higher interest rate, ranging up to 5%, as compared to the 2% if the loan had been modified under HAMP.  The unfortunate truth is that many and possibly most of these people were entitled to a HAMP loan modification, but had little choice but to accept a more expensive and less favorable in-house modification.”
“Upon joining the newly formed Case Management Department, I began to experience what Bank of America termed a “blitz”.  Approximately twice a month, Bank of America would order that case managers and underwriters “clean out” the backlog of HAMP applications by denying any file in which the financial documents were more than 60 days old.  These included files in which the homeowner had provided all required financial documents and fully complied with the terms of a Trial Period Plan.”
“During a blitz, a single team would decline between 600 and 1,500 modification files at a time for no reason other than that the documents were more than 60 days old.  Bank of America instructed its CRMs, underwriters and other employees to enter a reason that would justify declining the modification to the Treasury Department.  Justifications commonly included claiming that the homeowner had failed to return requested documents or had failed to make payments.  In reality, these justifications were untrue.  I personally reviewed hundreds of files in which the computer systems showed that the homeowner had fulfilled a Trial Period Plan and was entitled to a permanent loan modification, but was nevertheless declined for a permanent modification during a blitz.”
“On many occasions, homeowners who did not receive the permanent modification that they were entitled to, ultimately lost their homes to foreclosure.”
“Employees who challenged or questioned the ethics of Bank of America’s practice of declining modifications for false and fraudulent reasons were often fired.  There was an extremely high level of turnover in every HAMP related Bank of America department that I saw.  Employees worked in fear of losing their jobs if they called any of Bank of America’s practices into question.”
SENIOR COLLECTOR OF LOSS MITIGATION/MORTGAGE:
“Beginning in 2009, I regularly spoke to people who had received HAMP Trial Period Plans, made their trial payments, and who were calling to inquire about the status of their expected permanent loan modification.  Using the Bank of America computer systems I saw that hundreds of customers had made their required trial payments, sent the documents requested of them, but had not received permanent modifications.  I also saw records showing that Bank of America employees had told people that documents had not been received when, in fact, the computer system showed that Bank of America had received the documents.  This was consistent with the instructions my colleagues and I were given.  We were told to lie to customers and claim that Bank of America had not received documents it had requested, and that it had not received trial payments (when in fact it had).  We were told that admitting that the Bank received documents would “open up a can of worms” since the Bank was required to underwrite the loan modification within 30 days of receiving those documents, and it did not have sufficient underwriting staff to complete the underwriting in that time.” 
“My colleagues and I were supervised by “Team Leaders” who were, in turn, supervised by “Site Leaders.”  Site leaders regularly told us that the more we delayed the HAMP modification process, the more fees Bank of America would collect.  We were regularly drilled that it was our job to maximize fees for the Bank by fostering and extending delay of the HAMP modification process by any means we could—this included by lying to customers.  For example, we were instructed by our supervisors at Bank of America to delay modifications by telling homeowners who called in that their documents were “under review,” when, in fact, there had been no review or any other work done on the file.”
“Bank of America Site Leaders specifically ordered my colleagues and me to hold financial documents borrowers submitted for at least thirty days.  Once thirty days passed, Bank of America would consider many of these documents, such as pay stubs or bank statements to be “stale” and the homeowner would have to re-apply for a modification.”
“These and other similar instructions often came in monthly meetings that were conducted by Site Leaders and attended by 60-70 employees.  At these meetings, my colleagues and I were also given performance “goals” and quotas.  Employees were rewarded by meeting a quota of placing a specific number of accounts into foreclosure, including accounts in which the borrower fulfilled a HAMP Trial Period Plan.  For example, a Collector who placed ten or more accounts into foreclosure in a given month received a $500 bonus.  Bank of America also gave employees gift cards to retail stores like Target or Bed Bath and Beyond as rewards for placing accounts into foreclosure.” 
“Bank of America Collectors and other employees who did not meet their quotas by not placing a sufficient number of accounts into foreclosure each month were subject to termination.  Several of my colleagues were terminated on that basis.”
“Bank of America monitored my colleagues and me very closely.  Team Leaders and Site Leaders walked the call room floor throughout the day wearing headsets that they would use to plug in and listen into a call without warning.  Employees who were caught not carrying out the delay strategies that Bank of America instructed were subject to discipline including termination.  Employees who were caught admitting that Bank of America had received financial documents or that the borrower was actually entitled to a permanent loan modification were disciplined and often terminated without warning.” 
A “COLLECTOR”:
“Based on what I observed, Bank of America was trying to prevent as many homeowners as possible from obtaining permanent HAMP loan modifications while leading the public and the government to believe that it was making efforts to comply with HAMP.  It was well known among managers and many employees that the overriding goal was to extend as few HAMP loan modifications to homeowners as possible.”
“My colleagues and I were called into group meetings with our supervisors on a regular basis.  The information we received in group meetings showed me that Bank of America’s deliberate practice was to string homeowners along with no intention of providing permanent modifications.  We were instructed to inform every homeowner who called in that their file was “under review”—even where the computer system showed that the file had not been accessed in months or when the homeowner had been rejected for a modification.” 
“My colleagues and I were instructed to inform homeowners that modification documents were not received on time, not received at all, or that documents were missing, even when, in fact, all documents were received in full and on time.”
“One tactic Bank of America used to delay the modification process involved telling homeowners who applied for a HAMP modification or who were in a Trial Period Plan to resubmit financial information each time they called to inquire about a pending modification.  Bank of America then treated any change in financial information as justification for considering the homeowner to have restarted the HAMP process.  Even a small change to financial information or correcting an error that Bank of America made will cause Bank of America to restate the application process under the pretext of changed financial information.” 
“When Bank of America purchased loans from other servicers, including when it bought the servicer itself—as it did with Wilshire Credit, Bank of America forced the homeowners to restart the modification process.  When a homeowner called regarding a modification started with another servicer, my co-workers and I were instructed to say that Bank of America had no record of the modification or the payments the homeowners already made under the modification.  We were instructed to make this statement even when Bank of America’s system showed the homeowners’ modification and previous payments, and even when the system showed that the homeowner had completed the trial process with the previous servicer and should have received a permanent modification.” 
“When an account or attempted modification was considered “closed” it meant that the homeowner would not be receiving a modification and would often be facing collections or foreclosure.  The production goals Bank of America placed on its managers were based on how many accounts they could “close”—meaning how many homeowners they could reject for the loan modifications rather than how many modifications they could successfully complete.  Managers received bonuses if their teams met or exceeded production goals.” 
“Managers, in turn, pushed their production goals on the loan level employees.  Employees were awarded incentives such as $25 in cash, or as a restaurant gift card based on the number of accounts they could close in a given day or week—meaning how many applications for loan modifications they could decline.” 
“I personally witnessed employees and managers close loan accounts based on information that was obviously wrong.  This included closing accounts, and declining loan modification based on the homeowner’s failure to provide certain documents or information when, in fact, it was apparent from the loan file and from the electronic system of record (electronic databases including AS400, HomeSaver, HomeBase, and others) that the homeowner had provided the very information claimed to be missing.” 
“I witnessed employees and managers change and falsify information in the systems of record, and remove documents from homeowners’ files to make the account appear ineligible for a loan modification.  This included falsifying electronic records so that the records would no longer show that the homeowner had sent in required documents or had made required payments.  This was done so that the file could be closed, the homeowner’s effort to obtain a loan modification could be rejected, and the manager could meet Bank of America’s production goal for the given week or month.”
 TEAM LEADER (PROMOTED FROM UNDERWRITER):
 “I observed that Bank of America reported to the Treasury Department and made public statements regarding the volume of loans it was successfully modifying, and the efforts it was making to catch up with the volume.  Often this involved double counting loans that were in different stages of the modification process.  It also involved counting loans that were entitled to modifications as having been modified—only to foreclose on those same loans later.  It was well known among Bank of America employees that the numbers Bank of America was reporting to the government and to the public were simply not true.” 
 HOME RETENTION SPECIALIST: 
“I saw instances where Bank of America sent borrowers who were current on their permanent loan modifications foreclosure notices.  In some cases, where Bank of America did not update its system to implement the terms of a permanent modification, Bank of America foreclosed on homes of borrowers who were not delinquent on their permanent loan modification payments.” 
 “I was often instructed to give borrower misinformation about the status of a modification application.  I was told to tell borrowers that their applications were still under review even after a decision to grant or deny the application was already noted in the system.  I was also told to tell borrowers that their applications were incomplete because Bank of America did not have all the required documentation even when I could tell that all the documentation was in Bank of America’s system.”



 HEY DB STRUCTURED PRODUCTS , DEUTSCHE BANK, SELECT PRO-FOLIO SERVICES, ARCHBAY HOLDINGS LLC 2010B, ARCHBAY CAPITAL, CHASE, ROOSEVELT MORTGAGE, RUSHMORE, DO YOU SEE A SIMILAR PROBLEM HERE?????

Bank of America workers say the bank lied

By Michelle Conlin and Peter Rudegeair

June 14 (Reuters) - Six former Bank of America Corp employees have alleged that the bank deliberately denied eligible home owners loan modifications and lied to them about the status of their mortgage payments and documents.

The bank allegedly used these tactics to shepherd homeowners into foreclosure, as well as in-house loan modifications. Both yielded the bank more profits than the government-sponsored Home Affordable Modification Program, according to documents recently filed as part of a lawsuit in Massachusetts federal court.

The former employees, who worked at Bank of America centers throughout the United States, said the bank rewarded customer service representatives who foreclosed on homes with cash bonuses and gift cards to retail stores such as Target Corp and Bed Bath & Beyond Inc.

For example, an employee who placed 10 or more accounts into foreclosure a month could get a $500 bonus. At the same time, the bank punished those who did not make the numbers or objected to its tactics with discipline, including firing.

About twice a month, the bank cleaned out its HAMP backlog in an operation called "blitz," where it declined thousands of loan modification requests just because the documents were more than 60 months old, the court documents say.

The testimony from the former employees also alleges the bank falsified information it gave the government, saying it had given out HAMP loan modifications when it had not.

Rick Simon, a Bank of America Home Loans spokesman, said the bank had successfully completed more modifications than any other servicer under HAMP.

"We continue to demonstrate our commitment to assisting customers who are at risk of foreclosure and, at best, these attorneys are painting a false picture of the bank's practices and the dedication of our employees," Simon said in a email, adding the declarations were "rife with factual inaccuracies."

Borrowers filed the civil case against Bank of America in 2010 and are now seeking class certification. The affidavits, dated June 7, are the latest accusations over the mishandling of mortgage modifications by some top U.S. banks.

Mortgage problems have dogged Bank of America since its disastrous purchase of Countrywide Financial in 2008. The bank paid $42 billion to settle credit crisis and mortgage-related litigation between 2010 and 2012, according to SNL Financial.

Bank of America and four other banks reached a $25 billion landmark settlement with regulators in 2012, following a scandal in late 2010 when it was revealed employees "robo signed" documents without verifying them as is required by law.

But problems have persisted. Since 2012, more than 18,000 homeowners have filed complaints about Bank of America with the Consumer Financial Protection Bureau, a new agency created to help protect consumers. Recently, the attorney generals of New York and Florida accused Bank of America of violating the terms of last year's settlement.

The government created HAMP in 2009 in response to the foreclosure epidemic and to encourage banks to give homeowners loan modifications, allowing some borrowers to stay in their homes.


THE BLITZ

The court documents paint a picture of customer service operations where managers roamed the floor with headsets, able to listen into any call without warning. Service representatives were told to lie to homeowners, telling them their paperwork and payments had not been received, when in reality they had.

"This is exactly what's been happening to homeowners for years," said Danielle Kelley, a foreclosure defense lawyer in Florida. "No matter how many times they send in their paperwork, or how often they make their payments, they simply can't get loan modifications. They wind up in foreclosure instead."

The former employees said they were told to falsify electronic records and string homeowners along in foreclosure as long as possible. The problem was exacerbated because the bank did not have enough employees handling modifications, adding to the backlog of cases purged during the "blitz" operations.

Once a HAMP application was delayed or rejected, Bank of America would offer an in-house alternative, charging as high as 5 percent when the loan could have been modified for 2 percent under HAMP, according to an affidavit by William Wilson, who worked at the bank's Charlotte, North Carolina office.

Wilson, who was a case management team manager, said he told his supervisors the practices were "ridiculous" and "immoral." He said he was fired in August 2012.

Bank of America said it was not at liberty to discuss personnel matters.