Brooklyn Beatdown - Onewest Bank, F.S.B. v Drayton - Judge Arthur Schack Decision Casts Light on Robo-Signers and Foreclosure Fraud

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Onewest Bank, F.S.B. v Drayton
2010 NY Slip Op 20429
Decided on October 21, 2010
Supreme Court, Kings County
Schack, J.

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In
this foreclosure action, plaintiff ONEWEST BANK, F.S.B. (ONEWEST),
moved for an order of reference and related relief for the premises
located at 962 Hemlock Street, Brooklyn, New York (Block 4529, Lot 116,
County of Kings), upon the default of all defendants. The Kings County
Supreme Court Foreclosure Department forwarded the motion papers to me
on August 30, 2010. While drafting this decision and order, I received
on October 14, 2010, in the midst of the present national media
attention about "robo-signers," an October 13,
2010-letter from plaintiff's counsel, by which "[i]t is respectfully
requested that plaintiff's application be withdrawn at this time." There
was no explanation or reason given by plaintiff's counsel for his
request to withdraw the motion for an order of reference other than
"[i]t is our intention that a new application containing updated
information will be re-submitted shortly."

The Court grants the
request of plaintiff's counsel to withdraw the instant motion for an
order of reference. However, to prevent the waste of judicial
resources, the instant foreclosure action is dismissed without
prejudice, with leave to renew the instant motion for an order of
[*2]reference within sixty (60) days of this decision and order, by
providing the Court with necessary and additional documentation.

First,
the Court requires proof of the grant of authority from the original
mortgagee, CAMBRIDGE HOME CAPITAL, LLC (CAMBRIDGE), to its nominee,
MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. (MERS), to assign the
subject mortgage and note on March 16, 2009 to INDYMAC FEDERAL BANK, FSB
(INDYMAC). INDYMAC subsequently assigned the subject mortgage and note
to its successor, ONEWEST, on May 14, 2009.

Second, the Court requires an affidavit from Erica A. Johnson-Seck, a conflicted "robosigner," explaining her employment status. A "robo-signer"
is a person who quickly signs hundreds or thousands of foreclosure
documents in a month, despite swearing that he or she has personally
reviewed the mortgage documents and has not done so. Ms. Johnson-Seck,
in a July 9, 2010 deposition taken in a Palm Beach County, Florida
foreclosure case, admitted that she: is a "robo-signer"
who executes about 750 mortgage documents a week, without a notary
public present; does not spend more than 30 seconds signing each
document; does not read the documents before signing them; and, did
not provide me with affidavits about her employment in two prior cases.
(See Stephanie Armour, "Mistakes Widespread on Foreclosures, Lawyers
Say," USA Today, Sept. 27, 2010; Ariana Eunjung Cha, "OneWest Bank
Employee: Not More Than 30 Seconds' to Sign Each Foreclosure Document,"
Washington Post, Sept. 30, 2010).

In the instant action, Ms.
Johnson-Seck claims to be: a Vice President of MERS in the March 16,
2009 MERS to INDYMAC assignment; a Vice President of INDYMAC in the May
14, 2009 INDYMAC to ONEWEST assignment; and, a Vice President of
ONEWEST in her June 30, 2009-affidavit of merit. Ms. Johnson-Seck must
explain to the Court, in her affidavit: her employment history for the
past three years; and, why a conflict of interest does not exist in the
instant action with her acting as a Vice President of assignor MERS, a
Vice President of assignee/assignor INDYMAC, and a Vice President of
assignee/plaintiff ONEWEST. Further, Ms. Johnson-Seck must explain: why
she was a Vice President of both assignor MERS and assignee DEUTSCHE
BANK in a second case before me, Deutsche Bank v Maraj, 18 Misc 3d 1123
(A) (Sup Ct, Kings County 2008); why she was a Vice President of both
assignor MERS and assignee INDYMAC in a third case before me, Indymac
Bank, FSB, v Bethley, 22 Misc 3d 1119 (A) (Sup Ct, Kings County 2009);
and, why she executed an affidavit of merit as a Vice President of
DEUTSCHE BANK in a fourth case before me, Deutsche Bank v Harris (Sup
Ct, Kings County, Feb. 5, 2008, Index No. 35549/07).

Background

Defendant
COVAN DRAYTON (DRAYTON) executed the subject [*3] mortgage and note on
January 12, 2007, borrowing $492,000.00 from CAMBRIDGE. MERS "acting
solely as a nominee for Lender [CAMBRIDGE]" and "FOR PURPOSES OF
RECORDING THIS MORTGAGE, MERS IS THE MORTGAGEE OF RECORD," recorded the
instant mortgage and note on March 19, 2007, in the Office of the City
Register of the City of New York, at City Register File Number (CRFN)
2007000143961. Plaintiff DRAYTON allegedly defaulted in his mortgage
loan payment on September 1, 2008. Then, MERS, as nominee for CAMBRIDGE,
assigned the instant nonperforming mortgage and note to INDYMAC, on
March 16, 2009. Erica A. Johnson-Seck executed the assignment as a Vice
President of MERS, as nominee for CAMBRIDGE. This assignment was
recorded in the Office of the City Register of the City of New York, on
March 24, 2009, at CRFN 200900084809. However, as will be discussed
below, there is an issue whether MERS, as CAMBRIDGE's nominee, was
authorized by CAMBRIDGE, its principal, to assign the subject DRAYTON
mortgage and note to plaintiff INDYMAC. Subsequently, almost two months
later, Ms. Johnson-Seck, now as a Vice President of INDYMAC, on May 14,
2009, assigned the subject mortgage and note to ONEWEST. This
assignment was recorded in the Office of the City Register of the City
of New York, on May 22, 2009, at CRFN 2009000155018.

Plaintiff
ONEWEST commenced the instant foreclosure action on June 18, 2009 with
the filing of the summons, complaint and notice of pendency. On August
6, 2009, plaintiff ONEWEST filed the instant motion for an order of
reference. Attached to plaintiff ONEWEST's moving papers is an affidavit
of merit by Erica A. Johnson-Seck, dated June 30, 2009, in which she
claims to be a Vice President of plaintiff ONEWEST. She states, in 1,
that "[t]he facts recited herein are from my own knowledge and from
review of the documents and records kept in the ordinary course of
business with respect to the servicing of this mortgage." There
are outstanding questions about Ms. Johnson-Seck's employment, whether
she executed sworn documents without a notary public present and
whether she actually read and personally reviewed the information in
the documents that she executed.

July 9, 2010 deposition of Erica A. Johnson-Seck in the Machado case

On
July 9, 2010, nine days after executing the affidavit of merit in the
instant action, Ms. Johnson-Seck was deposed in a Florida foreclosure
action, Indymac Federal Bank, FSB, v Machado (Fifteenth Circuit Court in
and for Palm Beach County, Florida, Case No. 50 2008 CA 037322XXXX MB
AW), by defendant Machado's counsel, Thomas E. Ice, Esq. Ms.
Johnson-Seck admitted to being a "robo-signer,"
executing sworn documents outside the presence of a notary public, not
reading the documents before signing them and not complying with my
prior orders in the Maraj and Bethley decisions.

Ms.
Johnson-Seck admitted in her Machado deposition testimony that she was
not employed by INDYMAC on May 14, 2009, the day she assigned the
subject mortgage and note to ONEWEST, even though she stated in the May
14, 2009 assignment that she was a Vice President of INDYMAC. According
to her testimony she was employed on May 14, 2010 by assignee ONEWEST.

Then the Schack goes on to say later in the decision...

Then, plaintiff ONEWEST must address the tangled employment situation of "robosigner"
Erica A. Johnson-Seck. She admitted in her July 9, 2010 deposition in
the Machado case that she never provided me with affidavits of her
employment for the prior three years and an explanation of why she wore
so-many corporate hats in Maraj and Bethley. Further, in Deutsche Bank
v Harris, Ms. Johnson-Seck executed an affidavit of merit as Vice
President of Deutsche Bank. If plaintiff renews its motion for an order
of reference, the Court must get to the bottom of Ms. Johnson-Seck's
employment status and her "robo-signing." The Court reminds plaintiff ONEWEST's counsel that Ms. Johnson-Seck, at p. 161 of
the Machado deposition, volunteered, at lines 4 - 5 to "gladly show up
in his court and provide him everything he wants."

Lastly, if
plaintiff ONEWEST'S counsel moves to renew its application for an order
of reference, plaintiff's counsel must comply with the new filing
requirement to submit, under penalties of perjury, an affirmation that
he has taken reasonable steps, including inquiring of plaintiff ONEWEST,
the lender, and reviewing all papers, to verify the accuracy of the
submitted documents in support of the instant foreclosure action.

Conclusion

Accordingly, it is

ORDERED,
that the request of plaintiff ONEWEST BANK, F.S.B., to withdraw its
motion for an order of reference, for the premises located at 962
Hemlock Street, Brooklyn, New York (Block 4529, Lot 116, County of
Kings), is granted; and it is further

ORDERED, that the instant action, Index Number 15183/09, is dismissed without prejudice; and it is further

ORDERED,
that the notice of pendency in the instant action, filed with the
Kings County Clerk on June 18, 2009, by plaintiff ONEWEST BANK, F.S.B.,
to foreclose a mortgage for real property located at 962 Hemlock
Street, Brooklyn, New York (Block 4529, Lot 116, County of Kings), is
cancelled; and it is further

ORDERED, that
leave is granted to plaintiff, ONEWEST BANK, F.S.B., to renew, within
sixty (60) days of this decision and order, its motion for an order of
reference for the premises located at 962 Hemlock Street, Brooklyn, New
York (Block 4529, Lot 116, County of Kings), provided that plaintiff, ONEWEST
BANK, F.S.B., submits to the Court: (1) proof of the grant of
authority from the original mortgagee, CAMBRIDGE CAPITAL, LLC, to its
nominee, MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC., to assign the
subject mortgage and note to INDYMAC FEDERAL BANK, FSB; and (2) an
affidavit by Erica A. Johnson-Seck, Vice President of plaintiff ONEWEST
BANK, F.S.B., explaining: her employment history for the past three
years; why a conflict of interest does not exist in how she acted as a
Vice President of assignor MORTGAGE ELECTRONIC REGISTRATION SYSTEMS,
INC., a Vice President of assignee/ assignor INDYMAC FEDERAL BANK, FSB,
and a Vice President of assignee/plaintiff ONEWEST BANK, F.S.B. in
this action; why she was a Vice President of both assignor MORTGAGE
ELECTRONIC REGISTRATION SYSTEMS, INC. and assignee DEUTSCHE BANK in
Deutsche Bank v Maraj, 18 Misc 3d 1123 (A) (Sup Ct, Kings County 2008);
why she was a Vice President of both assignor MORTGAGE ELECTRONIC
REGISTRATION SYSTEMS, INC. and assignee INDYMAC BANK, FSB in Indymac
Bank, FSB, v Bethley, 22 Misc 3d 1119 (A) (Sup Ct, Kings County 2009);
and, why she executed an affidavit of merit as a Vice President of
DEUTSCHE BANK in Deutsche Bank v Harris (Sup Ct, Kings County, Feb. 5,
2008, Index No. 35549/07); and (3) counsel for plaintiff ONEWEST BANK,
F.S.B. must comply with the new Court filing requirement, announced by
Chief Judge [*17] Jonathan Lippman on October 20, 2010, by submitting
an affirmation,using the new standard Court form, pursuant to CPLR Rule
2106 and under the penalties of perjury, that counsel for plaintiff
ONEWEST BANK, F.S.B. has personally reviewed plaintiff ONEWEST BANK,
F.S.B.'s documents and records in the instant action and counsel for
plaintiff ONEWEST BANK, F.S.B. confirms the factual accuracy of
plaintiff ONEWEST BANK, F.S.B.'s court filings and the accuracy of the
notarizations in plaintiff ONEWEST BANK, F.S.B.'s documents.

This constitutes the Decision and Order of the Court.

Link to full decision below...

Check it out...

It is fascinating...

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4closureFraud.org

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LINK - Onewest Bank, F.S.B. v Drayton