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Lawsuit Alleges that MERS Owes California a Potential $60-120 Billion in Unpaid Land-Recording Fees
Former hedge fund manager Shah Gilani notes:
In
creating MERS, these institutions actually changed the land-title
system that this country - for much of its history - has relied upon to
determine legal ownership status of land titleholders.Not only did the lenders sidestep (read that to mean avoid) paying billions of dollars in fees to local governments, they paid themselves from the fees that MERS collected.
MERS
is facing class-action lawsuits and civil racketeering suits around
the country and their members are being individually named in all these
suits. One suit alleges that MERS owes California a potential $60 billion to $120 billion in unpaid land-recording fees.If
suits against MERS and all its members are successful, unpaid
recording fees and fines (that can be as much as $10,000 per incident)
would make every one of them insolvent.
MERS is a shell company, with no employees. However, its parent does have employees.
As Bloomberg notes:
MERS Inc., which holds the liens, has no employees, and MERSCORP, the parent, has only about 50, [the MERS spokeswoman said].
Plaintiffs'
lawyers will undoubtedly argue that the "corporate veil should be
pierced". In other words, they'll argue that MERS hasn't followed
normal corporate formalities (or is inadequately capitalized), and so
the big banks which own it should have to pay any judgments against it.
I am not sure who will win that argument.
But Plaintiffs' lawyers will probably also name the banks themselves directly as co-defendants.
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It means that the lien is not perfected on the property. MERS is simply an end around the recording process at the county level.
Shadow recording system for the shadow economy. Who could make this shit up!
can a shadow make a shadow? If it knows the right people?
Fawlty Towers"---Monty Python sells houses. I love it.
...not paying recording fees?...but paying out fat fees/commissions tp participants?
What is the difference from skimming cash receipts [e.g. casinos] to avoid first paying income taxes?
Sequence and intent are blatant illegalities.
States are starving for cash flow. The sharks smell blood in the water. This will get interesting fast.
I agree. Further interesting is the fact these instruments were hurried to market to try and meet the insatiable appetites of union government pension plans. Calpers, Calstrs, et al hold all kinds of this (now worthless?) MBS paper that now appear more like evidence of wrong doing than the "asset" they were origianlly marketed to be.
Returning the title to the original purchaser free and clear will be a logical first step, but that won't come close to satisfying the agonizing and debilitating losses suffered by so many taxpaying citizens by WS and DC.
The MSM hounds of Baskerville response is evidence as to the absolute seriousness and magnitude of this problem.
Let the states keep the fines and penalize the perps.
The citizenry deserve Restitution.
a footprint? of a man or a woman?
neither. it was of a gigantic bank.
As I have said before, it is not easy to pierce the corporate veil of limited liability. But it seems MERS is a sham operation that paid no attention to corporate formality. That being the case, the plaintiffs can go after the shareholders which are the banks.
Shit, what a case!
Meanwhile the partners of Scheister & Scheister LLP, the firm that opined that it is ok not to pay recording fees, had better start their asset protection program and make sure their Malpractice coverage is paid up because none of this gets done without some lawyer saying it is ok.
More and more it looks like complete overhaul of the financial system will be required!
http://psychonews.site90.net
Hi Charlie. How's junks?
This is just another huge blow to the banks ! The cancer just keeps growing and growing. At what point should we all not just pull all our money out of these lying degenerates and just buy gold.
May, 2001 (Where the hell is my flux capacitor!)
Done dat.
Yup, check, got gold.
So they put 1 or 2 'unknowing' fools in jail and that will be all
In the parlance of the scheister Fed run banker estalishment, such scapegoats are usually referred to as "rougue traders". "Rogue Traders" certainly rings well with "Robo Signers" doesn't it!
Hey Azannoth, why don't you test the validity of your bragadiaco with a sign on with one of the banks and just, ya know, sign a few papers?? I kinda think you really are Puff the Magic Drageon; a little troll. Milestones
I think that if they can connect the e.g. BofA paid employee who is also an "assistant secretary" of MERS to title-related fraud I would say the judge would consider that BofA was using MERS as a shell. Whether that in itself would be enough I don't know.
On my loan "Carmelia Boone" signed as Assistant Secretary for MERS.
Carmelia Boone also signed as "Authorized Signer" for BAC Home Loans Servicing, LP, FKA Countrywide Home Loans Servicing, LP on a Substitution of Trustee, on the same date and recorded a few days later.
Oh, by the way, the new trustee is Recontrust Company, N.A., which is wholly owned by BAC.
So, BAC is the loan servicer, wholly owns the trustee for the trust deed, and is a shareholder in MERSCORP, the parent of MERS.
Yeah, that corporate veil is leaky.
It seems there should be a way in through this - clearly and closely related? If the BofA official was working in the capacity of a MERS official even though being paid by BofA at the time, would suggest that MERS was a front organization.
From the conversations I have had with bankers they are (now) fully aware how serious this situation is, and realize they are exposed on a number of sides. Partly, they still cling to the belief that the government will protect the banks. Having lived through various scandals from the Enron mess onward, I honestly haven't known a worse scandal than what is unfolding. Things like Repo 105 were arcane complex structures that failed to grab the public's attention, but there are maybe half a dozen different ways in which the banks are screwed this time. You've got lawyers from borrowers, state governments and investors all coming at them, all with strong cases and all looking for big payouts. The total numbers would without a doubt wipe out all of the big banks, so let's assume the government wants to keep some semblance of a banking system, and will cut deals as they can, but either way, it's going to hurt the banks where they feel it most - in their wallets.
On that note, I admire the way they managed to push up financials last week, in the face of this and some pretty poor earnings numbers, shows how much control they have.
"Partly, they still cling to the belief that the government will protect the banks."
There's one key issue with this fiasco that I haven't seen mentioned. Namely, that these lawsuits offer an absolutely superb opportunity for a backdoor bailout of the States.
The Administration won't be able to give a direct bailout, simply because the States which have lived within their means (like Texas) will have very strong objections (and understandably so). So the next best thing is for this type of lawsuit to succeed, stick the Bankers with the bill, and then have the Federal Government pick up the tab.
The end result is that financially irresponsible States like California will end up with one huge bailout courtesy of all American taxpayers. I'm in California myself, so I'd like to say "Thank you" to all of you living in States that have been financially responsible. Just kidding, somewhat.
So, keep an eye on this one. There's a good chance of this happening even if the Banks are nationalized.
Interesting contention, Eternal Student.
Don't forget that state's rights have been eroded by bankers much the same way as the individuals.
In Texas, that means succession. Also, notably the other solvent states (fiscally prudent and actually competent with money) are all energy producing. Look for them to flex that muscle much to the detriment of the parasites like el Kalifornazona.
You will see oil, gas and electricity become the new currency to trade with uncle sucker in the district of crime Inc.
Texas has been itching for a fight for decades, and only course uncle sucker is hell bent on proceeding with is throwing the common man to the corporate dogs and fraud street syndicate. That dog don't hunt and days are numbered for all the states attached to uncle suckers money tits in the land of corporate lawlessness.
They way to pierce corporate ANYTHING is through the people that work there. Since corporate America is filled with nothing but spineless parasites with no sense of their own future it looks dim at the present. Anyone else been charged yet? Anybody?
Does one person in the USA Inc. have a spine, or are you too waiting to chew a bullet?
Forget my 'junk' clicking: If the banks go broke based judgements against them, there are parties the Federal taxpayer insures, but states missing out on fees isn't one of them. California is likely the last state in the Union that taxpayers will accept supporting, as well. Successful judgements will lead to the liquidation of large banks, their recapitalization, and re-emergence. Bond holders will not come back to the banks until either Glas-Steagel is back in place or other strict measures make the banks something new: A safe place to invest. That is exactly what we need. Germany's running through the same calculus this week: If they put the losses where they belong, on bondholders (in part), how much will capital cost the banks in the future? "Too much?" Not if they reform the European rules for bank leverage and capital, Basel 4.
Thanks for at least waving your hand. But you miss the point. Missing out on fees isn't the only issue. Making the bondholders whole again is far bigger. Most notably, pensions, which the State and local Governments are seriously on the hook for. Pensions have seriously invested in the MBS ponzi scheme, and if these go down (or when, I should say), there are going to be a lot of unhappy campers out there. They carry considerable political clout. If you don't think that's going to be an issue, I will have to disagree.
p.s. before we shed too many tears for fiscally responsible texas, remember where the windfall of the s&l bailout of 1990 (pale, so pale in comparison but still): texas in munificent part.
They will never let California collect the money. The flyover/wellfare states have been using the Northeast and the West Coast as financial pinatas for years.
there have been a variety of state courts that have done the heavy lifting and know that mers is a fraud. judge arthur schack of ny state supreme court in brooklyn has been ruling for years against the frauds committed by mers and the banks. here is a sample of one of his decisions, known as the "mers twilight zone" decision.
referring to a mers mortgage assignment, that does not state that it was signed by an officer of mers, nor did a power of attorney accompany the assignment (it was basically signed by who knows, the night shift cleaning lady?):
Thus, counsel's claim of a valid assignment takes the Court in to "another dimension" with a "journey in to a wonderous land of imagination," the mortgage twilight zone.
William C. Hultman of MERS, percieves that "mortgages registered on the MERS system exist on a parallel universe to those recorded with the City Register of the City of New York."
discussion of mers starts on page 8:
http://mattweidnerlaw.com/blog/wp-content/uploads/2010/07/merstwilightzo...
"I honestly haven't known a worse scandal than what is unfolding."
Hmmmm...
http://www.worldreports.org/news/284_definitive_illegality_of_securitisation_is_reconfirmed
Christopher Story, RIP.