Just ask JP Morgan/Chase.. there good at this game.

Lost paperwork..PLEASE.. the banks who have it hidden are giving them to them and than saying they never had it, just ask JP Morgan/Chase.. there good at this game. 


New York's banking regulator Benjamin Lawsky unleashed a verbal assault on nonbank servicer Ocwen Financial Wednesday, saying the company's explosive growth "raises red flags," and that its use of technology to better handle distressed loans is "too good to be true."

Speaking at the annual meeting of the New York Bankers Association, Lawsky said Ocwen's public documents make "for startling reading." He sees "corners being cut," by nonbank servicers that have touted their ability to help distressed borrowers.

"We have serious concerns that some of these nonbank mortgage servicers are getting too big, too fast," Lawsky told New York bankers who were meeting at the Waldorf Astoria. "We see far too many struggling homeowners getting caught in a vortex of lost paperwork, unexplained feed and avoidable foreclosures."

Last week, Ocwen put an indefinite hold on its $2.7 billion purchase of servicing rights from Wells Fargo after Lawsky raised concerns about the Atlanta-based servicers' growth.

Yet Lawsky refused to cite Ocwen by name. Instead, he referred to a public document filed with the Securities and Exchange Commission by "a nonbank servicer" that boasted to investors that it was still "in the middle innings of cleaning up the human wreckage left by the mortgage meltdown."

Ocwen has used the "middle innings" reference in presentations in January and in December to analysts and investors.

Lawsky also cited Ocwen's comments to investors that it has identified $400 billion in servicing rights that it plans to acquire in the next 12 to 18 months, and that up to $1 trillion in servicing will change hands in the next few years.

But he took particular umbrage by Ocwen's assertions that it can service delinquent loans at a cost that is 70% lower than the rest of the industry, calling into question its entire servicing model.

"Those kinds of cost-saving claims bear special scrutiny," Lawsky said. "Regulators have to ask whether the purported efficiencies at nonbank mortgage servicers are too good to be true."

As superintendent of New York's Department of Financial Services, Lawsky has jurisdiction over Ocwen as a licensed mortgage banker in New York. He also has additional insight into Ocwen's operations because in Dec. 2012, Ocwen agreed to an independent monitor as part of a consent order that cleared the path for its 2011 acquisition of Litton Loan Servicing from Goldman Sachs.

Lawsky made specific references to servicers' difficulty in handling the transfer of documents and dealing with distressed borrowers.

"We see electronic loan files strewn around the globe with no one who knows how to pull them together," Lawsky said. "We see a virtual potpourri of computer systems containing critical borrower information, but no one who knows how to extract that information at the right time and for the right purpose."

Kevin Barker, an analyst at Compass Point, says it is uncertain whether Lawsky is primarily concerned about Ocwen's ability to take on more distressed loans or if it the concerns relate to past servicing practices — or both.

"It's not easy to transfer the servicing and boarding of all these loans because you have to think about what kind of shape the files are in when they get them," Barker says.

Lawsky has previously used his authority to hold up past transfers of mortgage servicing to Ocwen and to demand concessions such as the independent monitor. Still, servicers are concerned whether his actions will set a precedent that upends other servicing transfers involving New York loans.

"Regulators should not just be rubber stamps," Lawsky told bankers.
Servicing
Regulation

JPMorgan Chase & Co. is offering $390 million of nonperforming loans

 I will bet money Wamu loans they have been trying to hide are gonna show up here .

JPMorgan Chase & Co. is offering $390 million of nonperforming loans as banks including HSBC Holdings Plc and Regions Financial Corp. increasingly look to sell troubled mortgage debt.

JPMorgan put the pool of debt, a portion of which is tied to residential properties in New York, on the market this week, said two people with knowledge of the offering, who asked not to be named because the sale is private. HSBC hired BlackRock Inc. to manage the potential sale of as much as $1 billion in delinquent loans and Goldman Sachs Group Inc. is handling an auction of about $700 million of modified loans for Regions, according to two separate people.

Sales of the debt are accelerating amid financial regulations that force banks to pledge more capital for some assets they hold, including nonperforming loans, or NPLs. The government also is adding to the supply as it auctions the debt to help prevent foreclosures and stem losses at the Federal Housing Administration.

“Banks have made a decision internally that a delinquent borrower is not a core customer,” Ashish Pandey, chief executive officer of Altisource Residential Corp., said at a conference in Las Vegas last month. Pandey, whose firm had 6,300 delinquent loans as of the third quarter of 2013, said he expects as many as 500,000 nonperforming loans to sell in 2014.

Potential buyers of nonperforming loans, tied to delinquent borrowers who haven’t yet lost their homes to foreclosure, include hedge-fund firms such as Ellington Management Group LLC and One William Street Capital Management LP. The firms are seeking alternative housing bets after subprime-mortgage bond prices jumped about 17% last year and property prices surged 24% from their 2012 low.

Values increased as the economy strengthened and firms led by Blackstone Group LP bought more than 366,200 single-family homes in cities such as Phoenix and Atlanta since January 2011 to turn into rentals, according to Port Street Realty and RealtyTrac data. That’s made delinquent loans a relatively cheaper way to acquire real estate or profit by working with borrowers who are behind on mortgage payments.

There are about 1.3 million properties in the U.S. tied to loans at least 90 days late and not yet in foreclosure, according to Black Knight Financial Services. Another 4.5 million borrowers are at least 30 days delinquent or in the repossession process, a Black Knight report showed last week.

Regions transferred $686 million of loans classified as troubled debt restructurings to held-for-sale in the fourth quarter, the bank said on a Jan. 21 call with investors. The majority of the loans were originated prior to 2007 and about 40% are located in Florida.

Amy Bonitatibus, a spokeswoman for New York-based JPMorgan, declined to comment on the bank’s offering. Rob Sherman, an HSBC spokesman, and BlackRock’s Brian Beades, declined to comment on the potential loan sale. Michael DuVally, a spokesman for Goldman Sachs and Evelyn Mitchell, a spokeswoman for Birmingham, Ala.-based Regions, declined to comment on Goldman Sachs’s role in the offering.
Servicing
REO

Great article for lawyers to pay attention to by Neil Garfield

Casablanca Deja Vu: Shocked and Total Disbelief

by Neil Garfield

Maybe it is true that some of the earlier attorneys for the banks were caught by surprise when they learned of fabrication of documents, unauthorized signatures and of course Robo signing. In this case lawyers from the state of Maine face possible discipline for their failure to take appropriate action in over 100 cases. This stems from the revelation that GMAC mortgage have an employee named Jeffrey Stephan, who was signing between 6000 and 8000 legal foreclosure documents per month without knowing anything. His job apparently was simply to sign his name. He wasn't told anything, he didn't see anything, and he never asked anything.  See no evil, hear no evil, speak no evil.

The law firm is Drummond and Drummond.  One of the attorneys for that firm, Paul Peck, testified at a hearing last Thursday that he was completely surprised that Stephan never read the affidavit. The problem for the firm is that they had 100 other cases in which the same employee had executed an affidavit that was being used in litigation. The firm did nothing to inform the court of the potential problem. The Bar Association is accusing the firm of violating its ethics and failing to notify the court in the other cases. There does not appear to be any allegation that the firm was complicit in the filing of a false affidavit. Most people on the foreclosure defense side of these issues believe that lawyers should be disbarred for not only failing to notify the court of the potential problem, but also failing to perform due diligence intentionally to avoid knowing that they were submitting false testimony.

While I agree that the lawyers probably had more than an inkling as to what was going on, it is my opinion that the firm should be put under supervision and probation. We are walking a fine line here and we must be careful what we wish for. Lawyer is obligated to advocate every possible position that might be beneficial to his client. If the lawyer does not absolutely know for sure that his client is lying, I think most people who are engaged in the enforcement of ethics and discipline of lawyers would agree that there is no foul. Those of you who have been represented by counsel in connection with some matter in litigation probably know that there are always more than one interpretation of the facts and always more than one opinion as to which facts are important and which are not. You expect your lawyer to use the things that are most beneficial to your position.

However, that said, I think the attorneys who used those affidavits after hearing the revelation about GMAC mortgage and subsequent revelations are in a different position. For self-preservation alone they had an obligation to inquire. They might face liability for their part in submitting false testimony to the courts of various states. Their insurance company will probably take the position that they were committing an intentional act for the benefit of preserving an extraordinarily large channel of fee revenue.  I think the insurance company would be right. And I think that those attorneys should face harsh discipline.

With all that we know about fraudulent conduct of all of our major financial institutions, which so far has resulted in perhaps $200 billion in settlements, it is hard to imagine why any attorney would not closely scrutinize documents submitted for support of a foreclosure action unless they were intentionally avoiding information that they knew or should have known existed. Of course each such case should be examined separately on its own fact pattern. Not all lawyers work for a foreclosure mill should be subject to major discipline or even investigation. The layering that  occurred on Wall Street was also happening in the foreclosure mills. They were creating imaginary lines so that they could throw the junior associates under the bus if the truth was exposed. I would advocate that the junior associates should be given immunity from prosecution and that the  discipline should be directed at the managing partners who were aware of the issues.

Maine Lawyers in Foreclosure Mill Face Discipline

 Of course all of this is just a distraction from the main question, to wit: why was it necessary to fabricate documents, commit perjury, and create all of this layering if the loans were actually enforceable?

My answer is the same as the allegations made by the investors who thought they were buying mortgage bonds, the insurers who thought that they were paying broker-dealers who had a loss, and the guarantors who thought that they were paying broker-dealers who had a loss. They are all claiming (in an out-of-court) that the broker-dealers committed fraud and mismanagement of money.

In plain language they are alleging that the investment banks (broker-dealers) stole the money that was intended to be invested in the trusts. They are alleging that the investment banks created a web of controlled companies that served as sham originators  on loans that were made using the money that investors advanced for the purchase of mortgage bonds issued by a REMIC trust that turned out to be unfunded and without any assets or income.  They are alleging that the mortgage documents are unenforceable.  Don't take my word for it ---  you can Google up the complaints and read it for yourself.

It must be fair to assume that the investment banks would not pay $200 billion unless they were saving themselves from liability for much more than that. It is also fair to assume that the settlements with the investors reduced the loss of the investors.  Therefore is also fair to assume that any demand for payment that does not reflect a reduction in principal (and therefore a reduction in interest) is wrong. Any notice of default would similarly be defective and so would the notice of acceleration. Any lawsuit were nonjudicial foreclosure  would also be defective. The parties involved have actual knowledge of both the documentary problems outlined in the case above in Maine and the money problems that have been announced with great fanfare.

So the question is why isn't the borrower getting credit on the loan account when these settlements occur and can be allocated to the loan account?  If the actual creditor has experienced a reduction in the account receivable, what is the basis for allowing anyone to claim that the full amount is still due?

And that leads to my final question of the day, to wit: why would anyone try to claim that the full amount is due and enter into needless litigation?  I can think of no answer other than pure greed and the failure to present this question properly  in a court of law.

Banks, Mortgage Companies Defrauded HUD, Veteran Whistleblower Says

A whistleblower with a track record of wresting large settlements from banks is suing 22 companies for allegedly filing fraudulent mortgage documents with the Department of Housing and Urban Development.

Lynn E. Szymoniak, famous for her 2011 “60 Minutes” interview on the robo-signing scandal, filed a lawsuit late Monday against the companies, including Deutsche Bank, Wells Fargo, JPMorgan Chase and Bank of America. The Palm Beach, Fla., plaintiff’s lawyer alleges the 22 banks, mortgage servicers, trustees, custodians and default management companies created fraudulent mortgage assignments and submitted tens of thousands of false claims to HUD.

The lawsuit is a stark reminder that banks still face massive litigation and potential settlements for wrongdoing from the mortgage boom and financial crisis. On Wednesday, JPMorgan Chase acknowledged that it violated the False Claims Act and agreed to pay $614 million to settle claims that it improperly approved Federal Housing Administration and Veterans Affairs loans that did not meet underwriting standards.

HUD oversees the FHA, which reimburses servicers for losses and fees when government-guaranteed loans go into foreclosure.

Banks can be held liable for treble damages under the False Claims Act if they are found to have "falsely certified" that mortgages met all FHA requirements. The act also gives whistleblowers the right to file suit on behalf of the government.

“It’s been very difficult to uncover how fraudulent documents were created and spread through the system,” says Reuben Guttman, Szymoniak’s attorney at the firm of Grant & Eisenhofer. “Lynn Szymoniak did the original analysis, looked at documents and put the pieces together in a way that nobody else did.”

The new lawsuit was filed in the U.S. District Court in South Carolina. Several of the defendants, including Deutsche Bank and Wells Fargo, said they are reviewing the lawsuit and could not immediately comment.

In 2012, Szymoniak helped the government recover $95 million from the top five mortgage servicers, as part of the $25 billion national mortgage settlement. She personally received $18 million for providing information on the filing of false claims on FHA loans.

The suit also seeks to recover damages and penalties on behalf of the federal government, 16 states, the District of Columbia and the cities of Chicago and New York for the financial harm incurred in the purchase of private-label mortgage-backed securities that allegedly used fraudulent documents in foreclosure filings since 2008.

As investors in mortgage bonds, the government and others paid fees and expenses for services such as reviewing all mortgage documents put into trusts that were supposed to be performed by trustees. The federal government bought mortgage-backed securities with missing or forged documents through several avenues, including the Federal Reserve's direct purchases and Maiden Lane vehicles, and the Treasury Department's purchases through public-private partnership investment funds, the suit states.

The complaint does not specify damages but Szymoniak says she expects them to total around $10 billion.

The fraudulent mortgage documents were created because the original loans documents either were never delivered to the securitization trusts, or they were lost or destroyed, the lawsuit states. Many of the documents were created years after the trusts’ closing dates and showed the trusts acquired the loans only after they were in default.

Servicers “devised and operated a scheme to replace the missing documents,” the lawsuit states, and to conceal the fact that the trusts and servicers never actually held the mortgage notes and assignments, which are needed to initiate a foreclosure.

Szymoniak was also instrumental in uncovering fraud and forged documents at DocX, a now-defunct subsidiary of Lender Processing Services. She worked with the Federal Bureau of Investigations and U.S. Attorney's office in Jacksonville, Fla., that ultimately led to the conviction of an LPS executive, the closure of DocX, firm, and various settlements by LPS, which is now owned by Black Knight Financial Services.
Servicing
Risk Management

Foreclosure Activity Drops to Seven-Year Low, with another scam

This is a bunch of bullshit! The reason why foreclosures are down , is because banks are keeping the ones they can't unload due to fraud , lost paperwork, robo signed,  no notes, and titles that are junk. They scammed the courts , and people who walked away or just gave up, which gave the banks  a new idea to scam the American people. We'll keep these homes, and condos and rent them and sell rentals on the stock market. So welcome to  bank owned rentals , with slum landlords.  I have gotta give our elected officials a hand here, not only did you, who were suppose to protect and serve the people screw them , but now, were being screwed again! Rents are high for the economy, and people  are living under slum conditions and the Banks are not fixing the problems, but they are sure filling there pockets. The hedge funds they created , to hide behind is now showing its ugly colors. These scumbags were allowed to steal and profit off  illegal foreclosures and now they are profiting off the homes again. When does it end? When will our elected officials start working with the people? This is a true travesty in this country and foreign banks are making a killing off us again, and our elected officials are allowing it. When do you start looking into this fraud?  May God have mercy on us.

RealtyTrac: Foreclosure Activity Drops to Seven-Year Low in 2013

Fri, 2014-01-31 18:24 — NationalMortgag...

RealtyTrac has released its December and Year-End 2013 U.S. Residential & Foreclosure Sales Report, which shows that U.S. residential properties, including single family homes, condominiums and townhomes, sold at an estimated annual pace of 5,167,255 in December, a less than one percent increase from the previous month and a 10 percent increase from December 2012. Counter to the national trend, annualized sales volume declined from a year ago in 18 of the nation’s 50 largest metropolitan statistical areas and was down in five states: California, Arizona, Nevada, Rhode Island and Oregon.
The national median sales price of U.S. residential properties—including both distressed and non-distressed sales—was $168,391 in December, virtually unchanged from November and up two percent from December 2012.
The median price of a distressed residential property was $108,494 in December, 38 percent below the median price of $174,401 for a non-distressed residential property.
The report also shows that short sales and foreclosure-related sales accounted for a combined 16.2 percent of all U.S. residential sales in 2013, up from 14.5 percent of all sales in 2012 and up from 15.2 percent of all sales in 2011.
“It may surprise some to see distressed sales rising in 2013 given that new foreclosure activity dropped to a seven-year low for the year,” said Daren Blomquist, vice president at RealtyTrac. “And while short sales did trend lower in the second half of the year, there are still more than 1.2 million properties in the foreclosure process or bank-owned, providing a sizable pool of inventory that the housing market is in the process of absorbing. Meanwhile, non-distressed sellers have not listed their homes for sale in droves, helping to keep the distressed share of sales at a stubbornly high level.”
Other high-level findings from the report:
►Sales of bank-owned properties (REO) accounted for 9.3 percent of all U.S. residential sales in December, up from 8.7 percent in the previous month and 9.2 percent in December 2012.
►States with the highest percentage of REO sales in December were Nevada (18.9 percent), Michigan (18.4 percent), Ohio (17.8 percent), Arizona (15.7 percent), and Illinois (14.7 percent).
►More than 436,000 REO properties sold in 2013, accounting for 9.3 percent of all U.S. residential sales, up from 9.1 percent in 2012 and up from 8.7 percent in 2011.
►Short sales (where the sale price is below the total amount of outstanding loans secured by the property) accounted for 5.7 percent of all U.S. residential sales in December, up from 5.1 percent in November but down from 6.7 percent in December 2012.
►States with the highest percentage of short sales in December were Nevada (15.3 percent), Florida (14.4 percent), Illinois (9.0 percent), Maryland (8.2 percent), New Jersey (7.9 percent), and Michigan (7.2 percent).
►More than 256,000 short sales occurred in 2013, accounting for 5.8 percent of all U.S. residential sales, up from 4.9 percent of all sales in 2012 but down from 6.0 percent of all sales in 2011.
►Sales to third-party investors at the foreclosure auction accounted for 1.2 percent of all U.S. residential sales in December, up from 1.1 percent in November and up from 0.8 percent in December 2012.
►Major metros where third party foreclosure auction sales accounted for at least 2.5 percent of all residential sales included Atlanta (4.7 percent), Orlando (3.9 percent), Miami (3.9 percent), Tampa (3.4 percent), Columbia, S.C. (2.8 percent), Las Vegas (2.8  percent), and Charleston, S.C. (2.8 percent).
►More than 48,000 U.S. properties sold to third parties at foreclosure auction in 2013, accounting for 1.0 percent of all U.S. residential sales, up from 0.5 percent of sales in 2012 and 0.5 percent of sales in 2011.
►All-cash purchases accounted for 42.1 percent of all U.S. residential sales in December, up from a revised 38.1 percent in November, and up from 18.0 percent in December 2012.
►States where all-cash sales accounted for more than 50 percent of all residential sales in December included Florida (62.5 percent), Wisconsin (59.8 percent), Alabama (55.7 percent), South Carolina (51.3 percent), and Georgia (51.3 percent).
►For all of 2013, 29.1 percent of U.S. residential sales were all-cash purchases, but the percentage trended substantially higher in the second half of the year. The 29.1 percent in 2013 was up from 19.4 percent in 2012 and 20.6 percent in 2011.
►Institutional investor purchases (comprised of entities that purchased at least 10 properties in a year) accounted for 7.9 percent of all U.S. residential sales in December, up from 7.2 percent the previous month and up from 7.8 percent in December 2012.
►Metro areas with the highest percentages of institutional investor purchases in December included Jacksonville, Fla., (38.7 percent), Knoxville, Tenn., (31.9 percent), Atlanta (25.2 percent), Cape Coral-Fort Myers, Fla. (24.9 percent), Cincinnati (19.3 percent), and Las Vegas (18.2 percent).
►For all of 2013, institutional investor purchases accounted for 7.3 percent of all U.S. residential property purchases, up from 5.8 percent in 2012 and 5.1 percent in 2011.

• NMP News
• Residential
• Servicing
• Settlement Services
• Trends
• RealtyTrac Inc.
• Daren Blomquist
• U.S. Residential & Foreclosure Sales Report

Many attorneys are doing well in court without the Steinberger decision

by Neil Garfield

Mark Stopa, Esq., from the West side if Florida, points out that he and other lawyers are winning cases without the benefit of some recent trial and appellate decisions. Our own experience at Garfield, Kelley and White LLC, shows the same results. In that respect I did a disservice to myself and my partners. Many lawyers did not get their pleading dismissed and were able to proceed into discovery and trial. I think Mark is right that I might have created a misimpression that there was no progress but for the Arizona or other decisions.

The fact remains that in most cases the Bank cannot prove its case and Judges are turning that corner. The old bias is fading. When a lawyer aggressively pursues weaknesses in the foreclosure case, there are many gaps in the pleading and proof of the party seeking foreclosure. And before I leave this out, pay attention to the pleading of the party seeking foreclosure and their answers either in its answers to discovery or at trial. It is the complaint and answer that frame the issues to be presented at trial. When there is a conflict, a proper objection can stop the Forecloser dead in its tracks.

For example, BofA in one case filed a foreclosure complaint stating that they were the Servicer and that the owner of the loan was an unidentified third party. In response to discovery they assert that BofA was always the owner of the loan and denied any sale or securitization of the loan. This amounts to an admission that the allegations of the complaint are untrue, that the verification of that complaint was a sham, and that the factual basis and legal theory of their case had changed. Since they are on the eve of trial, and no motion to amend was filed, the case is at issue on facts the attorney knows in advance cannot be proven or even proffered as evidence in view of the sworn answers to interrogatories. We'll see what happens in that case.

Joke of the day

When I read this I just had to laugh, the banks hired these companies and knew full well what they were doing, but once again, they get there fingers caught in the cookie jar and try to cry foul. I think its time to start with banks and servicers and brokers all being tested before being allowed to do anything in the housing industry.  

Alot of these homes were stripped down to the copper pipes , loss of furnaces , plumbing, and electrical  elements, and blamed the homeowners , when in fact it was the home inspectors the banks themselves hired. The banks are responsible for this as well , and money should be funded back to homeowners they have frauded in this new mess they created. 

FYI- I talked to one of these home inspectors from Bennington, VT and he informed me he just had gotten out of a 5 year jail sentence and the only job he could find. He also stated that if he takes all the houses thrown to him he can make close to 8000 plus a month. He goes all over Mass, VT, NH . All you need is a computer and camera , and they send him a list of homes , how nice .

 

Foreclosure Industry Says It'll Do A Better Job Of Screening Its Workers After Widespread Break-Ins

Posted: 01/30/2014 7:30 am EST  |  Updated: 01/30/2014 7:59 am EST

Safeguard Properties, Background Checks, Background Checks Banks, Background Checks Foreclosures, Bank Contractors, Bank Foreclosure, Field Services, Foreclosure Contractors, Mortgage Servicers, Property Preservation, Business News

After hundreds of lawsuits and thousands of complaints, banks are finally pushing for reform in one of the darkest corners of the housing market. Under new guidelines expected to be adopted this year by most of the industry, the workers that watch over millions of homes in default or foreclosure will be subject to heightened levels of background checks.
The measures are meant to screen out people convicted of a criminal offense, such as theft or fraud. They follow widespread allegations, first reported by The Huffington Post, that the handymen and home inspectors that banks hire to look after vacant properties are breaking into still-occupied homes, and looting them of valuables. Some of these people, who work indirectly for the banks through a web of contracting companies, have lengthy criminal records.
"The intent is to give communities a high level of confidence that the people walking around in homes are not going to cause problems," said Eric Miller, the executive director of the National Association of Mortgage Field Services, the trade association that helped design the new standards.
The new screening requirements mark the most significant effort by the mortgage industry to date to crack down on abuses that have resulted in a wave of unflattering media coverage, hundreds of consumer lawsuits and a case brought by the Illinois attorney general against Safeguard Properties, the biggest player in the industry.
HuffPost's investigation last year found that most of the break-in complaints involve homes that are in some stage of default or foreclosure, but still in legal possession of the occupants. In many instances, contractors stand accused of ignoring obvious signs of habitation, kicking down doors and crawling through basement windows in order to gain access, then changing the locks. In some cases, they are also accused of helping themselves to valuables found inside. One contractor working for Safeguard Properties in Arkansas is accused of looting a home of paintings and other valuables. A Connecticut woman claims another one of these workers stole her son's piggy bank.
It's not clear how often contractors accused of such thefts also have a criminal record, though sources within the industry say people with checkered pasts are drawn to the work, which often requires little training or special skills. While there is no data to show whether these people are more likely to commit abuses than others in the industry, background searches of individuals named in several consumer cases alleging break-ins and thefts revealed lengthy criminal pasts.
In one case, in Florida, a contractor arrested previously at least six times on felony charges is accused of taking a laptop computer and other items from a vacation home. According to a police report, the contractor, who was working indirectly for CoreLogic, a company based in Westlake, Texas, denied the allegations, even though his fingerprints were found on a can of beer left open on a counter in the home.
At the forefront of the push for new oversight is Wells Fargo, which recently began requiring its contractors to have "a satisfactory background check in place" before performing any work on its properties, according to a spokesman. Several companies that work for Wells Fargo, including Mortgage Contracting Services, based in Plano, Texas, have already alerted subcontractors and other workers that they are expected to comply with the new guidelines by the end of January.
In an email, a Wells Fargo spokesman said the change in policy came in response to "a lot of scrutiny around this issue."
The guidelines allow for different levels of scrutiny, though the companies adopting the policies haven't yet said which workers would be subject to the most intensive screenings. Miller said the aim was to prevent contractors with recent criminal convictions from stepping onto a property, a standard that would apply even to the low-paid workers who mow lawns.
Seven of the biggest foreclosure contracting companies that deal directly with banks have said they will adopt the heightened screening rules, Miller said. "We are seeking to professionalize our workforce," he said.
Bret Douglas, who owns Team Ironclad Preservation with 25 employees near Daytona Beach, Fla., said he understands the reasoning behind the heightened screening requirements, but said he is confused by the new guidelines. It isn't clear, he said, whether employees with criminal records could still perform basic maintenance work.
Douglas said he objects to the cost of the background checks -- $65 each -- and the presumption that someone who has committed a crime in the past should not be permitted an opportunity at redemption.
"If they did the crime and served the time, I say they should be given a second chance," he said. Several workers on his crew have criminal records, he said, adding that it is difficult to find adults willing to mow lawns in the hot Florida sun who don't have spotty pasts.
Also still unknown is how aggressively the mortgage companies will enforce the new standards. In the past, banks largely deferred to the contractors they hired to oversee themselves, a strategy that hasn't proved particularly effective.
That's because the contracting companies have often brushed off accusations that they are failing to supervise their workers. Safeguard Properties, which has attracted the majority of complaints, says it has required background checks for years.
At an industry conference in October, Safeguard founder Robert Klein signaled that stepped-up scrutiny wouldn't be welcome. Safeguard, he said, "has been monitoring itself for quite awhile."
"Complaints are going to happen," Klein said at the conference. "It is the habit of people, they love to complain."

The mortgage monstrosity in short plain statements.

The mortgage monstrosity in short plain statements. Based upon my analysis of information in the public domain, there are two ways that anyone claim a loan was securitized --- carved up into pieces and then sold to multiple buyers or bundled with other loans. Either way --- carving or bundling is meant to decrease risk. If one loan goes bad it is only a small part of the entire portfolio of loans you bought so the perception of risk is reduced.

There are two types of transactions in which a loan enters the stream of claims of securitization --- origination and acquisition. Origination is what it sounds like --- money from the investors is used to fund the loan. Acquisition is a purchase of the loans with investor funds from someone who made the loan without the help or money of anyone else. Either way, it is the money of investors that is used and therefore they are the only ones paying value for the loan. Therefore they are the creditor.

There are two ways that the investors money can enter the system --- Purchasing mortgage bonds or direct funding. Either way there is an intermediary party aggregating or carving the loans up. And here is the problem, to wit:

The investor money was used for direct funding of the loan origination or direct funding of the purchase of the loan. But the loan documentation named some third party that didn't loan or purchase the loan. My analysis indicates that not only was there no agency agreement between the investors and the party NAMED as the originator or purchaser, but that this was an intentional act of deception. The broker dealers selling the bond were selling a security issued by a REMIC trust.

But instead of giving the trust the money, they kept it and tacked on fees. And instead of using the investors' money to make loans through a trust they converted a direct funding transaction in which the investors should have been named the lenders into an acquisition from a "third party" thus creating a "profit" for the broker dealer. The profit was the sale of the loan the investor already owned to a trust that was never funded. They took junk mortgages and sold them as platinum loans --- creating an entirely fictitious profit for the broker dealer and increasing the risk of loss to investors exponentially.

So the investor had his money split into two pieces --- neither of which was the purchase of the bond, which is why all those investors and agencies and law enforcement are accusing the broker dealer of fraud. One piece was used to fund the origination or purchase of the loan and the other piece was a pool of money that would be used for Servicer advances and extra trading profits on fictitious trades generated internally by the broker dealer. This process creates a lying mortgage securing a lying note. And that is why the investors are saying the paper is unenforceable.

The banks have done a good job of blaming the borrowers for the fraud. But it is clear that no borrower even understands this process now, much less as the designer of the scheme. The broker dealers racked up huge profits through theft of investor money that should have been used to fund the origination or acquisition of mortgage loans but was used instead to create a slush fund. The fact that SOME of the money was used for loans is not good enough because that changed the whole deal and created a loan transaction with the borrower in which the actual lender was left out and the designated lender was a party controlled by the broker dealer to create fictitious transactions or purchase insurance on loans the brokers didn't own.

In cases like this the law is clear. Victims of the fraud must receive as much restitution of their investment as possible. And the perpetrators of the fraud are not allowed to enforce any "contracts" (loans) that they created under false pretenses to both the lender and the borrower. It is called unclean hands. So unless the foreclosing party can show a money trail that leads to the doorstep of the foreclosing party they have nothing but dirt on their hands.

Does this create a free house for the borrower? In most cases the answer is no. Because the borrowers were putting down earnest money and equity in their homes to get these wondrous loans that were too good to be true based upon appraisals of pricing that were coerced.

The bottom line is that the perpetrators of false schemes may not be allowed to keep the benefit of the money they stole nor the benefit of contracts they created under false pretenses to both the lender and the borrower.

They are not gonna get away with this

Not if we all pass this around the internet and let the truth come out, so please copy and paste and pass it forward to anyone and everyone.
It's our turn now.

The Banks have literally stolen trillions of dollars from pension funds, municipalities, states, federal agencies, sovereign wealth funds and private investors. Estimates range from $3-$20 Trillion. So where did they put that money? They didn't keep it in currency (too easy to trace and too easy to claw back). They are keeping it in natural resources which are (a) practically as liquid as cash and (b) likely to go up in value rather than keeping the stolen money in cash. The fact that they have already been fined for committing violations and crimes with the storage and movement of our natural resources is not stopping them any more than the fines and penalties they paid in the great group of mortgage-related settlements now totaling an estimated $200 Billion. Chump change when you have stolen trillions of dollars.

The foreclosures? That's just the finishing touch on the last scheme. Now the new one is starting in natural resources. They figure they have pretty much won the mortgage confrontation. Not on my watch!

Millions of tons of metal stored in "shadow warehouses"

Millions of tons of metal stored in "shadow warehouses"

Dec 27 2013, 04:29

• The WSJ shines a light onto "shadow warehouses," a hidden system of facilities that store tens of millions of tons of aluminum, copper, nickel and zinc across the globe for banks, hedge funds and commodity merchants.
• The warehouses operate outside the London Metal Exchange's system, are unregulated, and don't provide details of their holdings. As a result, it's unclear how much metal is held in the shadow system. This lack of visibility could cause major price swings.
• The WSJ article follows allegations that warehousing companies have artificially boosted the price of metals, particularly aluminum.
• Companies that operate metals warehouses include Goldman Sachs (GS), Glencore Xstrata (GLCNF) and JPMorgan (JPM), although the latter is looking to sell its commodities unit.
• Relevant tickers include VALE, AA, AWC, KALU, MNSF, CENX, NOR, BHP, RIO, ACH.
• ETFs: DBC, JJC, DBB, DJP, GSG, RJI, GCC, USCI, CFD, JJN, JJT, BOM, RGRC, CPER, CTF, RJZ, GSC, LSC, GSP, JJU, DEE, BDD, BOS, JJM, DYY, DDP, DJCI, LD, CMD, BCM, CUPM, UCI, RGRI, UCD, UBM, FOIL, BDG, LEDD, CMDT, SBV, USMI, DPU, NINI, FTGC, CSCB,

Yes, I do find it unacceptable

It’s A Wonderful Life! — The Lesson Is the Banker Gets to Keep the Money He stole

by Neil Garfield

I never liked the Capra movie "It's a Wonderful Life," but I never remembered why. Dissapointment. So even though I like to watch my favorite movies more than once, I avoided watching this particular movie. It was just a knee jerk reaction for me. But my daughter and I watched tonight and I saw it through the eyes of a nearly 67 year old man instead of a 6-7 year old kid. And I ended up reliving my disappointment.

You see when I watched it as a child I believed the movie would end with the old miser banker being wheeled in at the end and giving back the money he stole. 60 years later, not remembering the movie very well, I still expected the end to be one of slight redemption when the old man is wheeled in and gives George Bailey back the money that George thought Uncle Billie had lost. Disappointed again, only this time I was also infuriated. The banker, knowing he had come into the money by pure accident when Billie left it in the newspaper he was teasing Mr. Potter about, kept the money when he discovered it in full view of his associates who of course said nothing because of their fear that the old miser would not only fire them but ruin them. He was too big to fail.

There is no reason for Mr. Potter to keep the money. It isn't his and he knows it. But he is corrupt and he is corrupting the system with his money from city politics to federal influence. So he keeps it and doesn't go to jail.

As a child I believed in redemption and in some ways the Capra movie delivers it when the town people rally around Bailey and he is better off even without the return of the money from Potter. But the idealist in me expected that Potter would have returned the money anyway because he wouldn't want to be thought of as a thief. But this doesn't bother him, just like the mortgage fraud we have going on now.

And tens of millions of people love this movie because of its uplifting message of good people appreciating the life and people they have. But am I the only one who was disappointed and infuriated that old Banker Potter got to keep the money he stole?

Yes you could argue that Potter didn't exactly steal it, but he knew it wasn't his and if morality was enforced, the angel Clarence would have made sure everyone knew the Banker had the money that was threatening to put the Building and Loan Association out of business and ruining the reputation (like credit rating) of the perfectly innocent George Bailey who is content to make $45 dollars per week managing the small Building and Loan association. Bailey's goal is to do the right things to maintain and build a community that maintains values of decency, morality and civility. His goal is to get by just like his shareholder-depositors. He has no interest in getting rich, which Potter offers him when George has a crisis of confidence.

Potter's goal is money and he doesn't care if he turns his community into a pile of crap as long as he makes money doing it. In fact he likes it when things crash so he can buy bargains and in the process ruin the life and dream of thousands of people. Sound familiar?

Not that the movie lacked morality and a good story about the way we see our lives. But Capra takes a definite shot at the banker by leaving him out of the glory at the end when the town people gather up far more money than needed to save George Bailey from bankruptcy and possibly jail. The bank examiner is in town to do his work. His first and only stop is to tally up the capital of George Bailey's tiny Building and Loan Association but skips the bank that Mr. Potter owns. And Frank Capra tells us why when Potter tells us that a congressman calling Potter is told to wait on the phone when Potter is distracted by his petty jealousy of Bailey.

The movie has a good moral at the end. If you live your life doing well by others, there is a pretty good chance they will do well by you. But in the end, the nasty miser is all about staying rich and gets richer because he gets money that belongs to another person and hides the fact. He gets to keep the $8,000 he stole from Bailey's Building and Loan Association. The money Potter steals in the movie is only $8,000 or about $280,000 in today's money --- easily enough for bank auditors to close down the business of Bailey's bank and is enough to add to the fortune of Potter. So the moral of the story is the opposite of the lesson --- being a good person is a good thing but the successful bad person will always het his way. I reject that lesson and encourage you to do the same.

The amount stolen this time by the likes of Mr. Potter is about $13 trillion, causing hundreds if billions of losses in pension funds alone and yet the government is concerned about the welfare of Mr. Potter instead of George Bailey. Tens of millions of families were displaced from their jobs and homes. I find that unacceptable, don't you?

Information you need to know

The deal offered to and accepted by the the real lenders (creditors/investors) who ended up being trust beneficiaries to an unfunded trust with no assets, was that there would be multiple co-obligors so there was practically no way on earth that the investor could lose money --- except of course in the case of fraud.

AND fraud is what happened because the co-obligors were part of a vast system in which the loans were not securitized, not collateralized and not enforceable by any of the parties who seek enforcement.

They ARE enforceable by investors but only under implied contract theory; and because the title to the loan was stolen by intermediaries the mortgage encumbrance to secure the debt is simply not there. But it is being treated as though the mortgage encumbrance was valid. Eventually you will start seeing decisions that nullify the mortgage, nullify the note as to enforcement or but use the note as partial evidence of part of the deal.

The contract that the investor relied upon when he made the loan, includes multiple parties, none of which were disclosed to the borrower and most of which received very liberal compensation that was also not disclosed to the investor or the borrower. Whether disclosure was required to the investors is not my concern. But disclosure to the borrowers is obviously required but was routinely and universally ignored.

Dan Edstrom has provided his list of parties. As a senior securitization analyst, this is pretty complete. The point here is that the party borrowing the money agreed to a different deal than the the one offered by the lender. Neither the lender nor the borrower truly understood that they were both getting screwed in much the same way. And as most of you know, the Banks will do ANYTHING to stop borrowers from meeting up with lenders to compare notes. The conclusion of that meeting would most likely end in jail time for thousands of people. Here is a list of the co-obligors, conduits, transactions in which intermediaries claim (or have, with or without knowing it) some interest in the "securitized" transactions (i.e., the loans):

Codebtors

sub-servicer

master servicer

trustee

trust

swap provider

cap provider

FDIC Repurchase Agreements

PMI provider

pool insurance provider

certificate guaranty insurance policy

each investor (subordinate, mezzanine, non-offered, etc.)

fraud insurance policy

bankruptcy insurance policy

originator (buy back agreements)

sponsor (buy back agreements)

depositor (buy back agreements)

reserve funds

TARP funds

corporate guaranty

Surety Bonds

Letters of credit

Blanket Fidelity Bond

Mortgage errors and omissions and professional liability insurance policy

Excess proceeds

Excess recoveries

Foreclosure Profits

Investment earnings

US Bank.. well I called this one awhile back :(

US Bank is popping up all over the place as the Plaintiff in judicial actions and the initiator of foreclosures in non- judicial states. It is one of the leading parties in the shell game that is mistaken for securitization of loans. But on its own website it admits against the interests that it has advanced in courts across the country, that it has NO POWER TO FORECLOSE or to pursue any other remedies.

US Bank pops up as the foreclosing party as trustee for some supposedly securitized asset pool masquerading as a REMIC trust ( which we all know now was breached in virtually every way, which is why the IRS granted a one year amnesty for the trusts to get their acts together --- an action of dubious legality).

Both US Bank and the the Pooling and Servicing Agreement will usually state flat out that the servicer makes all decisions and takes all actions relating to the borrower and the borrower's payments. There are several reasons for this one of which is the obvious conflict that could occur if the the servicer and the trustee were both bringing foreclosure actions.

But the other reason, the hidden one, is that the banks want to keep the court's attention on the borrower's contract and keep it away from the lender's contract which is quite different than the borrower's contract. And THAT will invite inquiry as to how or even if the two contracts are related or connected such that the mortgage encumbrance gives rights to the trust beneficiaries such that the collection and foreclosure efforts will inure to the benefit of the trust beneficiaries in the REMIC trust.

So why is US Bank violating both the content and intent of the PSA and its own website? In my own law firm I have two entirely different foreclosure cases --- one in which US Bank is the foreclosing party and the other where the servicer started the foreclosure action. Both loans are claimed to be in the same trust although one is in California and the other is in Florida. Why would Chase bank as servicer started an action? Even worse, why did Chase bank start the action as though it was the creditor and claim that there was no securitization?

I am not sure about the answers to these questions but I have some conjectures.

In the Florida case, US Bank is bringing the case because the servicer can't --- it knows and its records show non-stop servicer advances to the trust beneficiaries of the REMIC trust that supposedly was funded and who purchased or originated the loans in the trust. In the California case, even though the servicer advances are still present it is non-judicial so it is easier for Chase to slip by without even pausing because unless the homeowner brings a legal action to stop the foreclosure sale it just happens. And then it is over. But Chase is treading on thin ice here which is why it is now transferring the servicing rights ---- and therefore the rights to litigate --- to SPS who did not make the servicer advances.

Both Chase and US Bank are going into bankruptcy courts in Chapter 11 proceedings and demanding adequate protection payments while the bankruptcy is proceeding, knowing and withholding the fact that the creditor is being paid every month and there is no default from the creditor's point of view. This would be important information for the debtor in possession and the his attorney and the Judge to know. But it is withheld in the hope that the borrower/debtor will never discover the truth --- and in most cases they don't, unless they get a loan level account report based upon a solid securitization report which is based upon a good title report.

Both US Bank and Chase are wiling to endure awards of sanctions for misleading the court as a cost of doing business because the volume of complaints about their illegal and fraudulent activities is nearly zero when compared with the total of all state court, federal court and bankruptcy actions. But now they are treading on even thinner ice --- they are seeking to get turnover of rents with people who own multiple properties. Their arrogance apparently overcame their judgment. The owners of multiple properties frequently have substantial resources to litigate against the US Bank and Chase and now SPS. The truth is coming out in those cases.

Other Banks who say they are trustees simply direct the borrower or other inquirers to the servicer. But where US Bank is involved it is seeking profit at the expense of the trust beneficiaries and the owners of the real property involved. It seems to me that US Bank has gotten too cute by half and is now exposed to multiple actions for fraud. And I question whether the current revelations about US Bank BUYING the position of trustee has any legal support. I don't think it does --- not in the PSA, not in the statutes nor under common law.

Chase Wamu Merger - Who really owns the loans?

Crowd Sourcing on the Chase-WAMU Merger and the Owner of the Loans

by Neil Garfield

LivingLies is crowd-sourcing this one. Send your transcripts, articles, letters to neilfgarfield@hotmail.com. We want to know what you have about the Chase WAMU merger and what effect your information has on the ownership of loans that were originated or acquired by WAMU. Remember there were multiple parties involved in this ---

1. Washington Mutual and subsidiaries, some of which still exist independently,
2. the ex-OTS (office of thrift supervision),
3. the FDIC receiver Richard Schoppe,
4. the US Trustee in WAMU bankruptcy,
5. Washington Mutual itself apart from the estate created and kept by the receiver and
6. Washington Mutual itself apart from the estate created and kept by the U.S. Bankruptcy trustee, and of course
7. Chase Bank whose merger document (on the FDIC website) with WAMU excludes loans and states that the consideration was zero for the merger.

Information about any of these and any cases in which the ownership of loans was at issue would be greatly appreciated. We will publish the list of resources as it grows.

You need to ask the right questions

22729

by Neil Garfield

In thinking about how to present the issues in cases where the loans are part of a securitization process, whether successful or unsuccessful, I realized that one of the things that I failed to do was bring the attention of the court to the the cornerstone of the transaction --- the loan closing, rather than the the actual chronological first step which is the selling forward of empty mortgage bonds to investors. I realized that if I was sitting on the bench and the matter before me was the foreclosure of a mortgage that was facially correct and recorded in the county records, any argument that starts with securitization is going to seem like side-stepping the real issues. So I am working on going outside the chronological order of reality and starting with the middle point, which is the loan contract and loan closing.

Every contract must have an offer, acceptance and consideration. Every first year law student knows that. In the case of mortgage loans, the loan contract consists of

OFFER: I OFFER TO LOAN YOU MONEY PROVIDED YOU REPAY ME ON THE TERMS SET FORTH ON THE NOTE.

ACCEPTANCE: YOU ACCEPT THE OFFER AND SIGN THE NOTE AND MORTGAGE

CONSIDERATION: I GIVE YOU THE MONEY

The problem is that the above scenario is not the usual scenario with 96% of all mortgages between 2001-2009. If I don't give you the money, there is no contract and even though you signed the note, I have no right to record the mortgage because I never loaned you the money. You were fooled by the fact that money appeared at the closing table just as I said. But the money wasn't my money and I didn't lend it to you. But you signed the note and mortgage to me. What I have just done is probably fraudulent and certainly a table funded loan in violation of the Federal Truth in Lending Act. When the Judge says "did you sign the note?", he is only asking half the required questions. The other half should be asked of the forecloser "did the payee on the note make the loan?" The answer in most cases is no, and in all cases as to the assignment of the loan, no value was paid by the assignee for the transfer to the assignee. The loan should either have been originated with the name of the actual source of funds on the note and mortgage or the assignment should have been recorded in the name of the trust when the loan was acquired. But then the wholesale rejection of common underwriting standards would have been exposed and most of the loans would never have been made.

The reason why Judges and lawyers are missing the mark in many cases is that the loan contract is not the one they are thinking about. In the great majority of loan contracts the actual source of funds is NOT the party who is named as Payee or mortgagee. The actual party who made the loan is either the group of Trust beneficiaries or the actual REMIC trust where the trust was funded. The loan contract is implied by law and undocumented. And the terms are not necessarily what was stated in the note and mortgage. The lenders agreed to a loan with different terms than the terms set forth in the note and mortgage.

The contract for loan that everyone has their eye on is written but never completed. The originator offers a loan provided that the borrower agrees to the terms presented and executes the loan closing papers. In plain language the originator is saying "I agree to loan you money provided you agree to the terms of repayment and you execute the loan closing documents." You agree and execute the loan closing documents but then the originator who made the offer does not make the loan. The result by any interpretation is that there is no enforceable contract. In fact, there is an implied duty to return the documents to the borrower marked canceled.

The originator has no documentation showing that it was acting as agent for the trust beneficiaries or the trust. Even if such documentation existed, it would have required that the originator act as agent for the Trust or the trust beneficiaries without disclosure to the borrower. Such a provision requiring non disclosure would violate Federal law (TILA) and would therefore be void.

But the money appears at the closing table anyway, unknown to the borrower, from the trust beneficiaries who thought their money would first be used to fund the REMIC trust where they would get certain tax benefits. The receipt of the money by the borrower creates an obligation to repay implied by law --- the assumption being that it wasn't a gift.

Thus when the Judge asks "Did you sign the note and mortgage" he or she is only asking half of the essential questions. The other half should be directed to the foreclosing party "did you make the loan"?

The forecloser would then be forced to explain why they should collect on a debt that was created outside of their cloud of parties and entities. This is why they don't allege they are the holder in due course because THAT would require them to prove they have the note and mortgage "for value" and that they didn't have actual knowledge of the borrowers claims and defenses. The borrower would only need to deny such an allegation thus forcing the burden of proof onto the forecloser --- a burden that no forecloser these days can meet unless it is a local bank loan.

Instead of alleging that the Forecloser is a holder in due course, they carefully allege that they are the holder with implied rights to enforce because the documents appear to be valid on their face. But a holder is subject to the defenses available in any breach of contract action including non-performance --- I.e. The denial that the originator ever made the loan. Then they stonewall discovery on questions about the wire transfer receipt that would reveal who made the loan. At trial the borrower should have objections and motions in limine after properly seeking to enforce discovery and getting no results except more objections.

If the homeowner raises the issue of payment of the loan from the originator they are properly challenging the existence of a valid contract, which was never formed because of the failure of performance by the originator. Most loans during the mortgage meltdown period fit this scenario.

The end result should be that the debt cannot be enforced by the foreclosing party because no entity in their "securitization" cloud ever performed the essential act required by the loan contract --- performing the act of delivering money as a loan to the homeowner. Hence no debt was created between THOSE parties.

Non stop servicer advances are payments to the creditors --- the trust beneficiaries (investors) --- of the trust whether or not the borrower is paying the required payments under the note.

This could also  be grounds for challenging the default saying that there was no default from the creditor's perspective because they continued to receive their expected payments. Or it could be grounds for saying they waived the default or that the default was cured while they were accepting the servicer advances. The creditor is only allowed to be paid once on your loan.

Assuming the court accepts that argument, you have established that there are not one, but two loan contracts --- the one that the lender saw, and the one that the borrower saw. That would mean there was by definition no meeting of the minds, which is a basic term used in contract law. If the money from investors actually funded the trust, then they could argue that there was nothing wrong with the two contracts because the borrower's loan contract was with the trust. But our retort would be that if the borrower's contract was with the trust, why were they not on the note?

These are Razor thin distinctions that must be carefully argued or presented by an expert. The goal would be to discredit the initial loan transaction such that the loan was not secured because the real contract was an implied contract at law rather than the written one you signed. If the written one is void, then the debt exists, but it is not secured by a mortgage, hence there could be no foreclosure.

Collection could only be by the trust in a judicial case brought against you that could be discharged in bankruptcy. I don't know how the homestead exemptions work in California bankruptcy court, so we would need to be careful about how this would be used. In any event, amounts received from insurance contracts and the like would be deducted along with offset for appraisal fraud --- but realize that appraisal fraud can only go so far. You must prove what the real value of the home was (not presume or guess at it) at the time of the  loan transaction, which could be the modification or refi which would be when the real value had already plummeted while the loan amount was higher. The difference between the appraised value and the real value could be the an element of consequential damages, and if you can prove malevolent intent you could ask for punitive damages.

While I have been writing about these things for years it is only now that some judges are beginning to loosen up to listen to the realities of securitization --- that it was a fraudulent scheme to deprive investors of their money and the promised secured enforceable loans. The investors all sued saying the loans were NOT enforceable even though they had supposedly been transferred into the trust. These are the lawsuits that the banks are settling every week or every other week for hundreds of millions or billions of dollars. The largest so far is Chase who just paid $13 Billion to settle claims of fraud, misrepresentation, and mismanagement of funds.

I love Neil Garfield

 I love Neil Garfield! Why you ask? He is the only one who has stood up and told the truth. I have read many articles, but I alway look for his daily. Thank you Mr. Garfield for caring about so many of us ..

 

JP Morgan to Pay Another $2Billion for Madoff Conspiracy

by Neil Garfield

When the news of Madoff first made it into the media from which we think we get the information on what is happening in the world, I had two thoughts --- both related to my own experience on Wall Street. The first thing was that at $60 Billion it was impossible for all the big bankers (see Simon Johnson's Thirteen Bankers book --- a smart read) and traders to have been ignorant of what he was doing; the corollary to that is they said nothing, knowing that Madoff was saying he was the smartest trader in the world. None of the broker dealers had ever done a trade with him. So they new it was a PONZI Scheme. And he went to jail and other unpleasant things happened to his family.

The second thing that came to mind was the question of was why none of the big bankers were reporting him. Normally, the self policing code periodically cast a fraudster under the bus to achieve popularity with the public and regulators. Here, they were feeding a monster that was literally robbing widows and orphans over decades. And the reason why they were feeding Madoff's scheme with new suckers investing in Madoff's nonexistent investment trading portfolio --- and the reason it finally leaked out --- was that it was timed perfectly with the mortgage Ponzi scheme. It was the perfect distraction from what the Thirteen Bankers were doing. They threw him under the bus at precisely the time that their own peccadillo's were about to hit the fan (sorry to mix metaphors).

The Madoff scandal was called the largest financial fraud in the history of the world. But sitting right next to it was the largest white elephant ever conceived in the imagination of the public or even fiction writers. Madoff had taken $60 billion whilst the Bankers were making off with a minimum of $13 Trillion. Do the math. The Bankers sucked out of our economy a minimum of 10,000 times what Madoff had taken and they had retained a minimum of 2,000 times what Madoff had taken. If you like Math that equates by division to Madoff's "largest ever financial fraud" being 0.02% of what the bankers had taken also by fraud but using more sophisticated systems and layers of trail and entities so it made it more difficult to prosecute the banks than Madoff which was really very easy.

But the Wall Street bankers had another card up their sleeve. They had created a shadow banking system that was twenty times the total amount of fiat money issued by all countries of the world. They used these "nominal" values to scare the shit out of central bankers and finance ministers and convinced everyone that no matter how evil their motives and actions, they were too big to fail because if the government took them down, the entire financial system would collapse. That was a lie, and the recipients of that message suspected it was a lie but none of them knew enough to be sure. So they chickened out.

The result was that millions upon million of families lost all of their wealth or most of it, all of their credit reputation or most of it, and so far some 15 million people have been displaced, thrown out of good paying productive jobs and are forever taking the cost of this theft on their own backs and that of their generations to come.

On the ground level this translated as a double standard. While there is widespread acceptance of the fraudulent mortgages, notes, debts, bets, insurance and ratings, their is no acceptance of homeowners as the real victims who are paying most of the cost of this theft whether they are in foreclosure or not. In fact even if the citizens are renting or just looking for a job or trying to finance an education that will make them into marketable labor commodities they are paying through lower paying jobs, dependence upon unemployment benefits, Medicaid and other services that are costing all taxpayers trillions of dollars in what would otherwise by GDP.

And if that isn't enough the Federal Reserve is propping up these bankers with false balance sheets and false reserves with purchases of bonds that were never worth a penny because the asset pool never received funding and never owned a single loan. This is a cover up for more quantitative easing which is the printing of more money which in turn demeans the value of our currency and eventually will result in wholesale changes in world currency and cost of goods and services.

Some lawyer today at court said I know who you are--- you're the guy who hates banks. No. I have sat on the boards of banks and represented banks In Foreclosures both residential and commercial. I have filed hundreds of foreclosure actions for condominium, cooperative and homeowner associations. There are over 7,000 banks and credit unions in this country alone. I only dislike about 15 of them which means I like about 6,985 of these institutions who perform valuable services for a vibrant economy. I don't even dislike securitization. I just don't like when securitization documents are used to cover up a financial fraud. Is that wrong?