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The Sophisticated and the Scammed – MBS Trusts Keeping Assets on the Books Long After they are Liquidated
The Sophisticated and the Scammed
Each time an investor group or shareholder sues a financial institution for MBS damages, the financial institution files a response stating the investors "were sophisticated investors who knew or should have known better."
We are beginning to uncover and expose continuing scams, fraud, and theft (hint: monthly renewing statute of limitations).
The MBS trusts' accounting is as suspect, invalid, inconsistent, and outright fraudulent as are the real estate documents fabricated by document mills.
All eyes are on the Pino v BoNYM as trustee of CWALT 2008-oc8 (BoA servicer) fraudclosure case. The FHFA, regulator of Freddie Mac which owns class/tranche 1A1, claims all manner of origination, underwriting, appraisal, loan-to-value, and ratings fraud in their suit against Countrywide (here), and also tranche 2A2B was such a "toxic asset" that it was purchased by the Fed at 100 cents on the dollar and dumped into Maiden Lane II.
After Roman Pino's fraudclosure defense lawyer at Ice Legal uncovered and exposed massive fraud in the lower trial court, Palm Beach County's 15th Judicial Circuit, Bank of New York Mellon as Trustee and their fraudclosure mill attempted to slink away by voluntarily dismiss the case while they filed a new case with newly fabricated fraudulent documents.
Ice Legal said, "Not so fast! We insist on a hearing to review the evidence so the judge can dismiss this case to avoid the new fraudclosure case from going forward." But the lower court judge ruled that it is perfectly acceptable for fraud to be perpetrated on the court as long as the fraudster voluntarily dismisses the case once the fraud is exposed. Ice Legal brought this issue up on appeal. The bank friendly puppets in Florida's 4th district court of appeal didn't want to touch this case with a ten foot pole. The appellate judges allowed the lower court decision to stand but turfed up the the case to the Florida Supreme Court stating that fraud was rampant and an issue of great public importance.
BoNYM (BoA servicer) freaked out because, unlike Florida's lower and appellate courts, Florida Supreme Court is not a sure bank puppet operative. So, the case was "settled" with a confidential agreement. Both the fraudclosure mill and Mr. Pino's lawyer notified the Florida Supreme Court that the case had been settled and both parties were requesting the case to be dismissed.
The Florida Supreme Court Justices, acknowledging the public importance of foreclosure fraud, decided to keep the case alive. (Can you hear BoNYM & BoA howling in protest?)
While the settlement with Mr. Pino is confidential, we do know that a satisfaction of his mortgage was recorded in the public records in July 2011 (below).
Despite the fact that this mortgage "asset" no longer exists, the trust is still claiming this mortgage as an asset as of the Jan 2012 investor report, charging all sorts of fees, including monthly servicing fees, etc.
Our research has uncovered other non-existent "assets" on the books of this trust. To put this in perspective, at the origination of this trust there were 6,734 loans of which 61 were originated in Palm Beach County. As of the Jan 2012 investor report, 29 of the original 61 Palm Beach County loans remain on the trusts' books. Only ONE is performing as originally contracted at closing. Three others have been modified; one has a $39k forbearance, one has a $8k added to principal, one has $16k added to principal. The other 25 loans are non-performing. (As of Jan 2012 report, total left in the trust 2,921; of the 2,921 left 1,187 are non-performing (delinquent = 237, bankruptcy 188, foreclosure = 512, REO = 250) but we know this data isn't correct, so....)
Some "non-existent" loan examples from the trust
Roman Pino loan #130133456 - $162,400 - (July 2011 satisfaction - still on the books in Jan 2012 trust report in "foreclosure" status) [3764 Mil Run Court, Greenacres, FL 33463] - BoA monthly servicing fee for non-existent mortgage $50.73
Samantha Woodruff loan #130521936 - $171,940 - (Sept 2011 deed from trust REO to new buyer - still on the books in Jan 2012 trust report in "REO" status) [1497 Lake Crystal Drive D, West Palm Beach, FL 33411] BoA monthly servicing fee for non-existent mortgage $33.70
Robert Rodriguez loan #130450231 - $176,542 - (Sept 2011 short sale deed & Nov 2011 satisfaction - still on the books in Jan 2012 trust report in "REO" status) [1139 Lake Terry Drive 60L, West Palm Beach, FL 33411] WOW - BoA monthly servicing fee for non-existent mortgage $181.69
Elsa Castillo Rivas loan #130445815 - $375,000 - (July 2011 short sale deed) - remained on books through Dec 2011 in "REO" status), finally reported as "liquidated" in Jan 2012 report [13918 Preacher Chapman Place, Centreville, VA]. WOW - BoA monthly servicing fee for non-existent mortgage $328.04
This is just a small example of what we are uncovering. If we learned anything from the robosigning scandal, if there are more than two "irregularities," there are thousands.
More examples from other trusts to come.
www.4closureFraud.org
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Samantha Woodruff loan #130521936 - $171,940 - (Sept 2011 deed from trust REO to new buyer - still on the books in Jan 2012 trust report)
BoA monthly servicing fee for non-existent mortgage $33.70
| Date | 07/29/2011 |
| Amount | $230,000 |
| Seller | CASTILLO RIVAS ELSA M |
| Buyer | GRANO PAUL |
| Notes | Valid and verified sale |
| Deed Book and Page | 21776-2185 |
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Gross negligence HA! It's called Socialized Crime Inc. "no one sees it coming."
All this shit is symptomatic that the rule of money has thwarted the "rule of law." Now just an international joke.
I want bankers and "market makers," appraisers, and liar loan makers run through the meat grinder by the fucking thousands! That is the payment for abortion called justice.
Well its very difficult to prove intentional fraud unfortunately while gross negligence would be easier level of scienter to nail the banksters on. Regardless banker parasites can't just act with reckless abandon against society and rule of law whether its negligence or pure evil is besides the point. The conduct needs to be prosecuted to disincentivize it or our society is done at least the way we knew it.
I am not concerned re banks going after a debt twice. I am more concerned when going to sell real property that an old paid off lean that has never been satisfied ( ie recording of proper paperwork even if partially fraudulent) will greatly delay a closing in escrow or cause a bond to be purchased and held for years reducing purchase price to seller. Real estate is illiquid enough as it is. In the event that you want to sell or even borrow against it you want to be able to do so quickly. Not wait months for an uncontested quiet title action to work its way through our overburdened underfunded state court systems.
In addition to the appraisers who articificially inflated values, the originators who faked and encouraged borrowers to lie, the banks securitizing them who looked the other way, the ratings agencies who magically transformed all these junk mortgages into AAA instutional gold, adn the banks again commiting perjury to foreclose, I would like to see the white shoe lawyers strung up.
I am sure that there exists various legal memorandums billed at $500 dollars an hour or more from white shoe firms blessing for instance the creation of MERS, and then the whole cooking up of fraudulent paperwork and suborning perjury in the courts to foreclose on properties on behalf of owners who couldn't prove they owned the note/ mortgage. These white shoe firms only recruit lawyers from top ten law schools who instead of focusing on black letter law classes like I don't know "Property" have a panoply of classes on various "Critical race studies" and other such progressive gobbelygook. Anyone who paid attention in a half way decent first year Property Class is aware of such common law principles as the "Statute of Frauds" which has only been around for I don't know at least 300 years, and the axiom of countless professors "Record or Die." As if any first year law student couldn't predict problems with not actually keeping the original note/ deed of trust/ not executing and recording a valid assignment of the note or deed or trust etc. I am sure that all the banks practices were blessed by armies of white shoe lawyers both at white shoe firms and their former denizens toillling as corporate counsel for the banks.
For some insight into how this "rule of law" and hundreds of years of jurisprudence promoted prosperity see http://www.nakedcapitalism.com/2010/12/the-1677-statute-of-frauds-histor...
If you pay a note off at closing (with the buyer's proceeds), then what difference does it make when the satisfaction finally comes? They're living in your old house... they get possession and use of the property...
These things have ALWAYS taken time to come back after sale...
What keeps me up at night are derivatives on these toxic loans, the sale multiple times of the same loans, phantom loan servicing fees... the failure to enforce the law... the increased hand of government to coddle failed industries and paradigms (and the people behind them).
The things you're talking about all have safeguards in home courts across the country... we're going to win those... the others... well... we'll see.
The wise man who pays off a note has a good lawyer. [emphasis on good]
A title policy specifically associated with the satisfaction must be be written with the homeowner as the sole named insured.
The policy must not be impeachable and the underwriter must have a demonstrable ability and willingness to satisfy the obligations defined in said policy.
These title outfits have their asses hanging out and are carrying alot of bad paper already.
This is an important point... namely that if you're relying on an insurer, then they'd better be solvent (or large enough for the government to come in and give you 100 cents on the dollar for your bet/policy). And yes, they're up shit creek without a paddle on a lot of inventory, given they'll be asked to defend titles when the suits start flying.
But... if all of the title insurance companies fail, then we're probably going to have bigger fish to fry and the point will be moot. [the government will probably step in anyway and fill in the shoes of the insurer].
It's also my understanding that the policies are specifically excluding a whole lotta real estate... so, definitely need to be sure to read the policy and go over and questions with the other party...
I lost your email address. If you still have mine my zero hedge username is in it.
yeah, i'll send you an email in the near future.
I see what you mean. Well I hope that you're right and order is restored as played out state by state. Still its troubling to me that there is such disdain for the rule of law. ANd as you have pointed out its a double edged sword. Hopefully the mortgage industry will learn its lessons. But its hard for me to imagine that they are learning when there is no prosecution for perjury or conspiracy ot subborn perjury etc.
At the federal level its almost a lost cause post Citizen's United. So yeah the derivatives are stupidly dangerous and the banks seem to lobby their way out of transparency and regulation if any regulator makes even the slightest hinting. Thanks Larry Summers for killing the CFTC's initiative to regulate derivatives.
Our country is dead.
Not really... it's more like the black knight on monty python.
No - it is full of people who are going to work hard and do well. The zombies must die to give them air. ZH is helping to kill the zombies.
Trust No One, especially authority ........
Fitzgerald, what an author, but in his case it's really fiction.
Well I guess a few people with big balls are going to get free homes.
Show me the papers, bitchez!
It happened to my neighbor. She was evicted on Dec 09, the foreclosure was over-turned, and title reverted back to her with no lienholder - title and tax reports show no lienholder - strangest thing I've ever seen.
Yep. This is happening A LOT. Now, the courts will rarely invalidate the promissory note, but they sure as shit will throw out a mortgage...
This should not be confused with the process of people trying to get a free house by complaining (in a new cause of action) that the banks have slandered title or some other nonsense... Using these facts as a sword has a much more vague (and unlikely) track record than using them as a shield to protect one's self from foreclosure.
The thing is, if you do not have standing to pursue a claim, the judgment rendered therefrom is VOID. This means even a BFP can be dispossessed of the property after foreclosure sale... oops.
Without MERS, and with the regular filing regulations (established over hundreds of years of property transfer) this would not even be in the news -- because it wouldn't exist. I'd accuse them of purposely establishing MERS with a view to future fraud, but that's giving them too much credit and foresight. Even more eggregious is the amount of money not paid to County Clerks for filing fees. Money that States could surely use.
Rocky, MERS rose under the supervision and consent of the States... they subverted their recording acts to allow for the assignment of mortgages without necessity of filing... so no, it's not egregious to avoid filing fees when you are not legally responsible for doing so...
Further, there is rarely an obligation to record... rather, it is purely voluntary... however, failure to record means you cannot partake in the recording acts (e.g. get priority over others who do record).
I'll assume your assertion to be a crock unless someone can post evidence to the contrary.
Most states do not require assignments of motgages to be filed. For example:
http://www.ncga.state.nc.us/enactedlegislation/statutes/pdf/bysection/chapter_47/gs_47-17.2.pdf
http://www.legis.nd.gov/cencode/t35c03.pdf (See 35-03-05.1)
Just a sample. Varies from state to state, though.
Okay Macho, point us to any state's "consent" of MERS or any state's action toward "supervision" of MERS. Betcha won't be back because it DOESNT EXIST. The Banksters developed MERS on their own with asking anyone.
Yes - it came from the banks and was endorsed by Freddie and Fannie, but the counties did not do there job in my view. Actual physcial titles are to be recorded with the counties - why did they roll over for virtual titles? Probably because the rising tide of home prices meant a rising tide of property taxes to be assessed.
Here are all the consent orders I think you are referring to.
MERS April 2011 Consent Orders - Master List
Sometimes I think it is even worse when they don't even bother with the MERS charade.
bingo. State governments (and their arms) didn't say shit... because the boom in housing created net marginal tax revenue... they simply turned their heads...
And, the titles ARE recorded... it's the subsequent assignments that are not recorded... we KNOW who is the record title holder...
PS, for the donkey above you, the recording acts of states typically dictate only mortgages need be recorded, not assignments thereof, or more commonly, the note underlying payment. Conceptually, the initial mortgage is recorded and the downstream assignee(s) are indicated in the mortgage instrument (e.g. MERS and any subsequent nominees the mortgagee chooses, etc.)... these transactions are governed by UCC Article 9, not the recording acts... however, a few states have held otherwise, but this is the exception and not the rule. Here is a memo that sets out quite a few of the issues with the UCC: http://www.uniformlaws.org/shared/docs/Payment%20Issues%5CPaymentIssues_Report_031411.pdf
He who permits himself to tell a lie once, finds it much easier to do it a second and third time, till at length it becomes habitual; he tells lies without attending to it, and truths without the world's believing him. This falsehood of the tongue leads to that of the heart, and in time depraves all its good dispositions.
THOMAS JEFFERSON, leter to Peter Carr, Aug. 19, 1785
A great find - eternal truth. Early in life I did figure out that lieing, at very best, was just a weaker way of getting what a person wants. The person who is doing it is too dumb to achieve his underlying needs by other means.