BOA, Urban Lending Sued for Rackateering on Fraudulent “Modification” Program
In a case that may have far-reaching consequences, a lawsuit was filed in federal court in Colorado accusing Bank of America of racketeering, which is what borrowers have been screaming about for years. It was a game to the bank. They intentionally lured people into what they thought was a good faith modification program, encouraged people to get deeper and deeper into "debt", and then foreclosed when they were sure that the person could not reinstate nor exercise a right of redemption. A key player in this scheme was Urban Lending Solutions.
In
a case that I am currently litigating, Bank of America at first denied
any knowledge of Urban Lending Solutions. When confronted with
correspondence issued from urban lending solutions under the letterhead
of Bank of America, they finally conceded that they knew who who the
company was. In a Massachusetts case depositions were taken and it is
quite clear that this affiliate of Bank of America had their employees
working off of Scripts and that anyone who went off the reservation
would be disciplined or fired. Going off the reservation merely meant
that they actually tried to help a borrower achieve a modification.
There
are at least six whistleblowers who have executed sworn affidavits
stating that the modification program was a sham. I think we might be
getting closer to the point where whistleblowers tell us that the
origination of the loan was a sham and that the so-called sales of loans
were also sham transactions. Those employees of Bank of America or
their affiliates who were successful in throwing homeowners into
foreclosure were rewarded with $500 gift certificates to Target and
other stores.
The
claims against Bank of America are using laws that were designed to
target organized crime. For seven years experts and laymen have been
claiming that the banks were engaged in organized crime in the the sale
of mortgage mines, origination of loans, the assignment of loans, the
recording of unperfected mortgage liens, wrongful foreclosures, illegal
foreclosure sales in which the property was sold without any cash being
paid, interference in the right of the borrower to reinstate, modify,
or redeem.
We
are just around the corner from the key question, to wit: why would the
banks engage in organized crime to create foreclosures when it is
painfully obvious to homeowners and local government officials across
the country that the banks have no interest in acquiring the property
but only causing the sale of the property at a foreclosure auction? Why
would the banks delay the prosecution of their cases for years? Why
would the banks argue against expediting discovery against them and
against the borrower? Why would the banks argue for less money in
foreclosure rather than more money in modification?
The
answer to all of those questions is simply that there is more money in
this scheme than has been divulged. In the coming weeks and months the
revelations about the true nature of these transactions will shock the
conscience of the country and cause voters and politicians to rethink
their position regarding the ability of regulators and courts to
clawback illegally obtained proceeds that started with the transactions
originated with the money of investors and somehow ended up with the
banks growing by 30% despite a failing economy and a diving housing
market.
We
are now at the point where filing RICO charges against the banks is
likely to gain traction whereas in prior years it was considered
overkill for what appeared to be negligence in paperwork caused by the
volume of mortgages and foreclosures. Volume had nothing to do with it.
The banks made a ton of money selling those mortgage bonds. But the
money they made selling the mortgage bonds was dwarfed by the amount
they made when they received insurance, credit default swap proceeds,
and taxpayer money on investments owned by the investors and not by the
banks. So far more than 5 million foreclosures have proceeded
illegally which means that 5 million families have been disrupted in
some cases beyond repair. Recent estimates suggest that another 5
million foreclosures will be added to the list unless the banks are
required to conform with their regulations and the laws of the federal
and state government.
