News, Research & Insights for American Homeowners, Patriots & Constitutional Conservatives
Will this be the social issues election, after all?
It’s interesting, isn’t it? This election cycle was supposed to be dominated by jobs and the economy, but, lately, social issues have saturated the news cycle. No less than the unemployment numbers, they work to the detriment of the president. The public just isn’t particularly happy about the direction we’re headed as a society — [...]
Both Romney and Gingrich ahead of Obama.
Barack Obama wanted to change the direction of American politics, and it looks as though he has succeeded — to his own detriment. A new USA Today/Gallup poll shows a nine-point change in party identification in the swing states that Obama must carry to win re-election next year. And despite the fractious nature of the [...]
The street fighters that are out there fighting these battles every day are making headway, but things are only going to change now that the real prize fighting, hard-charging, sword wielding super lawyers have joined the fight.
Take some time to read what a great, well-researched piece of legal masterpiece looks like. Allegations from this complaint include:
As alleged in further detail herein, all the Defendants acted in
concert and conspired to unlawfully and secretly violate and avoid the
bankruptcy rules, the bankruptcy code, and the federal and the state common
law in their roles as attorneys and vendors to creditors to the detriment of
Plaintiff.
Each of the Defendants reached an agreement to illegally split
attorneys’ fees (“Illegal Agreement”), acted in concert and conspired in
furtherance of the Illegal Agreement, enjoyed a significant benefit from the
Illegal Agreement, which caused harm to the Plaintiff, and the Court. The
Plaintiff’s class representative and the Class members consist of those
persons other than the Court who have been harmed by the conduct set out
herein. Each of the Defendants was a necessary party to the conspiracy.
Please read the full complaint here:
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I have grown increasingly frustrated in fighting this battle because in many cases the fight is senseless. More often than not, a deal could be reached that would serve the best interests of the homeowner and……it would make the most business sense to the lender. The problem is in many cases it’s not the lender that’s calling the shots, it’s the federal government and their absurd policies and programs. Loans cannot be modified because of rigid HAMP guidelines. Short sales cannot get approved because the FDIC’s loss share agreement is more profitable to the lender if they take a loss. The lender will not waive deficiency against my judgment proof debtor because it’s Fannie/Freddie.
The record profits of the banks show they’ve figured out how to turn all of this to their advantage; not so the American people. They’re stuck fighting their government and the absurd policies that are working to their detriment…..policies they paid for through hard earned tax dollars. It’s the Golden Rule….
He who has the gold rules…..
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From M. Solimon
Editor’s Note: Pretty Good Entry From M. Solimon discussing aspects of fraud. I would add the following:
- FRAUD: A false statement wherein the speaker knows it is false, intends for it to be relied upon to the detriment of the receiver, who does reasonably rely on it to his/her financial detriment.
- FRAUD IN THE EXECUTION: A trick where the signor believes he/she is signing something other than what the document says it is. Probably applicable in the mortgage mess because the truth is people did not know they were signing the equivalent of their own financial destruction whereas the parties presenting the document pretended it was a standard mortgage loan that had been properly subject to industry standard verification and underwriting standards.
- FRAUD IN THE INDUCEMENT: A lie causing a person to execute a document, and otherwise meeting the definition of FRAUD as above. Examples “This is the fair market value of your new house,” or “Housing prices always go up, nevr down,” or “we’ll be able to refinance the property, give you more money out of it, all before the time for reset of the payments.”
Deceit and fraud are defined separately in statutes. Under Civ. Code §§1709 and 1710, deceit is defined in simple terms. See Civ. Code §§1572 for both actual fraud and 1573constructive fraud.
Loook at Liability for actual fraud is limited to acts committed by or with the connivance of a party to a contract with the intent to deceive another party to the contract and induce that party to enter into the contract. Look under Civ. Code §1572
Deceit is appropriate under a material beach or perhaps cause of action. The notion of a lender, who willfully deceives its borrowers or customers leading to foreclosure so to remedy an investor issue and to avoid recourse.
]I suggest you use it there or for the servicing argument for showing the willful intent to induce the consumer homeowners of a right to modifications ad compliance with 2923. to alter his or her position towards litigation (and eat up the balance of legal reserves their intended for a defense and their attorneys). These guys, I know all too well and it’s all too much. The consumer’s injury or risk is liable for any damage suffered as a result of the deceit. [Civ. Code §1709] etc, etc.
My take on this is too isolate the actual fraud that consists of any of the following acts, committed by or with the connivance of a party to a contract who is the assignor and its agents and not the successors.
The argument is it is with willful intent a lost beneficial interest woefully deceives a trustor or mortgagor to the contract, solely to induce the other party to enter into the contract [see Civ. Code §1572]:
Deceit and Actual Fraud combined
•Servicing rights violate SEC 1122 AB,
•Accounting rules violations under FAS 140, FIN 115,
•Trust assets are restricted to passive investments,
•Lenders controlling interest revoke the powers of sale and foreclosure,
•Parties lack standing to bring a foreclosure by appointment,
•Conspiracy to commit fraud where Trustee, Beneficiary and Transferee are all one in the same
•Bid rigging at trustee sale
•Fraud perpetrated against the country recorder
•A nominal interest has powers that conflict in the original assignment,
•Violations of the Code of federal regulations “CFR”
Your feed back will be critical and evident where I have gone as far as I can. It’s not getting through to skilled litigators that still don’t get it. Maybe I am lacking your codifications eloquence and ledger capacity to zero into the abuses of GAAP in more subtle terms; LOL!
he head of the OCC stated in 2009 “I don’t know why getting relief from offering modifications is not working?”
It’s simple “BECAUSE LENDERS FORECLOSING DON’T OWN THE ASSETS THEY SOLD ….for starters.
That said, even after the effort and inability for the US Secretary to further tweak FASB to get them to completely roll over.
Few are winning here. Even Judges who are deciding the matter favorably are commenting from a wrong perspective. There is no demand on UCC judicial interpretations for perfection in a bonefide sale.
The District Courts hearing these chapter proceedings provide comments after deciding the matter favorably are merely suggesting it’s all about “get it right next time”. That wrong where it says’s to a lender they can bring it back, even when a decision is favorable.
The key arguments come down to the fact the lender transfers each receivable as a “whole loan” sale. For Pete’s sake, looks at the general ledger where the asset was entered as a “Receivable” and “Loan Held for Sale”.
That’s not “Loan Held to Maturity” but “Sale”.
The cost to capitalize and reserve a 30 year loan held to maturity defeats the arguments lenders are making that “they did not sell the subject loan. It’s the old “blank assignment” gimmick. Its arguments are lost in court where the problem peaks the Judges curiosity and that’s about it.
We know the value of the open assignment argument is defining for the court where it’s a bank surety and liquidity play. It’s also a GAAP disclosure fraud.
Therein the consumer is disadvantaged arguing defects after being instrumental in a lenders shuffling of assets for maintaining REPO requirements and in its pursuit for shareholder earnings and profitability.
My take on the matter is to let them have the consumer’s home. The consumer then makes the lender pay the price of foreclosure claiming recognition, for reclassifying the sales as debt and restating earnings.
These UD attorneys are so smart that they may cost these bank power houses a debt load totaling about $3 trillion and more in liabilities left off the books. It’s a scary thought actually where you put Citigroup out while not looking and as they still struggle with a $65 billion tax tab carried by consumer taxpayers. BAC may end fighting for their life with a private right to call receivership.
Foreclosures cannot continue in violation of GAAP and where lenders circumvent basis accounting laws while continuing to force the sale treatment issue and while denying they are controlling assets.
It’s the best of both worlds with sale on the front side and as if it was leveraged borrowing upon liquidation and egress.
As we sit I’ll show you the subtle instances of apparently innocent manipulation and confusion befallen o to the courts from errors and omissions which lenders are getting away with. That is happening as the courts say . . . . So what!
The errors and omissions are the desperate means for seeking to maintain some semblance of SFAS140 adherence while employing lawyers as third parties appointed by agents of agents by a nominal interest.
I personally have given up on the right MERS arguments as MERS is entitled to act as an accommodation and even a nominal interest, possibly.
It’s just so easy for one to see the obvious that it has become lost. The nominee cannot execute instruments upon being replaced by the signature below it. Hello guys, right! That’s the purpose of the nominee! And, while one courts rules in favor of the consumer it misses the call.
Something basic is getting lost and I’m not getting through. Unique “floating” entities cannot appear from nowhere to execute assignments by virtue of meritless appointments.
If one of your cases is picked up by the Fed it should register a nice settlement . As one District court judge put it with disgust. . . “The SEC is turning into a penalty and fine system where they are to quick to settle the matter for a couple hundred million every time allowing the defendants’ to save face.”
“That’s not bad!
The US AG office thinks there is a case for bid rigging but I’m not sure the AG’s office knows where to look. Yet as one Judge told me in court “speak English.”
The precise and distinct GAAP and FASB rules violation are clearly demonstrated in each foreclosure. Lenders are violating GAAP even with the recent codification, including revisions and interpretation.
It’s all mind boggling when you consider the distance in communication here and counsel’s alternative to grab the lowest hanging fruit. . . .A RESPA audit (what is that anyway) and a QWR that together are just not going to cut it.
These bank execs fail to realize maybe that these and other Enron style crimes, like those stated in the Fastow confessional, will gets you 10 years . . .at least.
M.Soliman
Witness to Counsel
Expert.witness@live.com
It is gratifying to see state officials taking a proactive stance. As comptroller, Mr. Liu should consider the details, however. The fact remains that modifications are largely a sham. The only lender of record is the usually the originating lender. The parties charged with modification have little or nothing to say or do about modifications.
What is necessary is for Mr. Liu and other officials to study this issue and perhaps read the Big Short by Lewis. Until they realize that this can never be as simple as they want it to be, and that the mortgage mess is a train wreck still in process, it will be impossible to have meaningful modifications of mortgage in which the investors are protected to the maximum possible extent and the homeowners are protected as well. Principal reduction is only a bad thing from the prospective of the intermediaries who actually have been receiving all the money but actually have no financial interest in these mortgages.
From the prospective of those who actually have money at risk that was advanced for the funding of loans principal reduction is the answer for them as well as the borrowers. It is only when the investors step in directly and settle these mortgages that they will get anywhere near what is needed to mitigate their losses. Leaving it to the intermediaries who cheated them in the first place, is only allowing the the diversion of funds and the distracting misapplication of funds and documents to the detriment of the investor-lenders.
Hoping to succeed where Washington has largely failed, New York City’s comptroller, John C. Liu, and six large unions plan to begin a campaign on Wednesday to press the biggest banks to do more to prevent foreclosures in the New York area.
Mr. Liu said the group would send Citigroup, JPMorgan Chase, Bank of America and Wells Fargo, among others, a letter that criticizes them for dragging their feet on modifying mortgages that are underwater or delinquent, and that urges them to do “everything possible” to avert foreclosures.
Depending on the response the coalition members get, they might move pension funds and bank deposits to other institutions, according to union officials.
“The federal programs in place just aren’t having a desired effect,” Mr. Liu said in an interview on Tuesday. “People are losing their homes. It continues to be a drag on our regional economy.”
In the letter, a copy of which was provided in advance to The New York Times, Mr. Liu and the presidents of six of New York’s most powerful unions will ask the banks to immediately name a high-level official to handle appeals of borrowers who are denied mortgage loan modifications.
Their letter criticizes the banks for “unanswered phone calls, delays in the modification process and multiple requests for homeowners to resend paperwork already submitted.”
“Banks like you can do more,” the comptroller and union presidents write.
The coalition will officially announce the effort a news conference on Wednesday. The unions involved are the United Federation of Teachers, the 1199 health care workers union, the Transport Workers Union, the District Council 37 municipal employees union, the New York Hotel and Motel Trades Council, and Local 32BJ of the service employees union.
The group said that 265,000 mortgages in New York State — 13 percent of all mortgages in the state — are past due or already in the foreclosure process.
The officials ask the banks what efforts they have undertaken to respond promptly to customers’ requests about modifying mortgages and to suspend foreclosures while evaluating a borrower’s eligibility for loan modification.
Michael Mulgrew, president of the United Federation of Teachers, said hundreds of teachers and teachers aides faced foreclosure. “We’re trying to help people who are doing the right thing,” he said. “It seems that the banks are not really doing a lot on this. They’re not trying to negotiate in many instances.”
The letter asks the banks to respond by Sept. 1, with some of the signers suggesting there will be a second letter that demands the banks take specific steps.
Federal officials, from President Obama on down, have tried various techniques to persuade banks to make more loan modifications and take other steps to reduce foreclosures. But so far, those steps appear to have done little to stem the foreclosure flood.
Mr. Liu said that “it’s premature to talk about sticks,” like moving city funds out of banks that are deemed unresponsive.
But Mr. Mulgrew said he had alerted the trustees of his union’s pension fund to the situation, raising the possibility that they might take some action. Union officials say pension funds are hurt by foreclosures because they weaken the economy and hurt bank profits, helping to drive down bank share prices.
Richard Simon, a Bank of America spokesman, said his bank had led the industry in addressing the foreclosure crisis. In an e-mail message, he said, “Bank of America is committed to helping our customers remain in their homes, as demonstrated by 650,000 modifications we have completed since January 2008, including about 160,000 so far this year.”
A Citigroup spokesman, Mark Rodgers, made similar comments. “In the first quarter of 2010, our various modification and extension programs helped many families stay in their homes in New York State, outnumbering those who were foreclosed by approximately 54 to 1,” he said in an e-mail message. “Nationally, from Jan. 1, 2007, through March 31, 2010, Citi has helped more than 900,000 homeowners avoid potential foreclosure.”
See this article posted by our friend Anonymous:
Posts by Aaron Task
“A Gigantic Ponzi Scheme, Lies and Fraud”: Howard Davidowitz on Wall Street
Jul 01, 2010 08:00am EDT by Aaron Task in Newsmakers, Banking
Related: XLF, AIG, GS, JPM, BAC, C, FNM
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Day one of the Financial Crisis Inquiry Commission’s two-day hearing on AIG derivatives contracts featured testimony from Joseph Cassano, the former head of AIG’s financial products unit. Goldman Sachs president Gary Cohn was also on the Hill.
Meanwhile, the Democrats are still trying to salvage the regulatory reform bill, with critical support from Senator Scott Brown (R-Mass.) reportedly still uncertain.
According to Howard Davidowitz of Davidowitz & Associates, what connects the hearings and the Reg reform debate is the lack of focus on the real underlying cause of the financial crisis: Fraud.
“It was a massive fraud… a gigantic Ponzi Scheme, a lie and a fraud,” Davidowitz says of Wall Street circa 2007. “The whole thing was a fraud and it gets back to the accountants valuing the assets incorrectly.”
Because accountants and auditors allowed Wall Street firms to carry assets at “completely fraudulent” valuations, he says the industry looked hugely profitable and was able to use borrowed funds to make leveraged bets on all sorts of esoteric instruments. “Their bonuses were based on profits they never made and the leverage they never could have gotten if the numbers were right – no one would’ve given them the money in their right mind,” Davidowitz says.
To date, the accounting and audit firms have escaped any serious repercussions from the credit crisis, a stark difference to the corporate “death sentence” that befell Arthur Anderson for its alleged role in the Enron scandal.
To Davidowitz, that’s perhaps the greatest outrage of all: “Where were the accountants?,” he asks. “They did nothing, checked nothing, agreed to everything” and collected millions in fees while “shaking hands with the CEO.”
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