If you thought property values have seen the bottom, wait til you get a load of the coming foreclosures… you ain’t seen nothing yet!

Like everything else, they have no idea what they are doing.

REUTERS-

About one million American homeowners would get writedowns in the size of their mortgages under a proposed deal with banks over shady foreclosure practices, U.S. Housing and Urban Development Secretary Shaun Donovan said on Wednesday.

The deal, which could be struck within weeks, would mark the largest cut in the mortgage load since the start of the credit crisis.

“We’re very close to a settlement that would both fix the servicing problems, but also help over a million families around the country stay in their homes and get help,” Donovan said at a U.S. Conference of Mayors meeting in Washington.

Talks between federal officials, state attorneys general and major banks to resolve allegations of “robo-signing” and other misconduct in foreclosures have dragged into their second year.

[REUTERS]

© 2010-12 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.
www.StopForeclosureFraud.com

Commonwealth of Massachusetts

 Southern Essex District Registry of Deeds
Shetland Park
45 Congress Street
Suite 4100
Salem, Massachusetts 01970

JOHN L. O’BRIEN, JR.
Register of Deeds
Phone: 978-542-1704
Fax: 978-542-1706
website: www.salemdeeds.com

 

NEWS

FOR IMMEDIATE RELEASE

Salem, MA

January 18th, 2012

Contact: Kevin Harvey 1^st Assistant Register

978-542-1724

kevin.harvey@sec.state.ma.us

O’Brien calls for criminal action against the Big Banks

Says they acted like “criminal enterprise”

Saying that the time has come for a full scale criminal investigation, Southern Essex District Register of Deeds John O’Brien, today has sent some 31,897 of what he says are fraudulent documents that have been recorded in the Salem Registry to Massachusetts Attorney General Martha Coakley, U.S. Attorney General Eric Holder and U.S. Attorney Carmen Ortiz. O’Brien said that he is asking these officials to impanel a Grand Jury to look into the evidence that he has presented. “I am confident that these documents will show a pattern of fraud, uttering and forgery. These documents are signed by known robo or surrogate signers, whose signatures were supposedly witnessed by notary publics.  In addition, these documents may contain fraudulent information in the body of the documents. I believe that a criminal investigation is the next step to hold the perpetrators responsible.” O’Brien praised Attorney General Coakley for her aggressive pursuit of wrongdoing in her civil action but noted that other states such as California, Nevada, Illinois and Michigan have launched criminal investigations, and O’Brien is hopeful that Massachusetts will do the same.  O’Brien strongly  suggests that the Grand Jury should subpoena both the past and present Chief Executive Officers (CEOs) of the Mortgage Electronic Recording Systems, Inc. (“MERS”), Bank of America, JP Morgan Chase, Citibank, Wells Fargo,  Countrywide, Washington Mutual among others.  In addition, he is asking that the top officials of DOCX, Nationwide Title Clearing, Inc. and LPS also be subpoenaed. “These companies have been retained by MERS and its member-banks to produce the documents that I am alleging contain fraudulent information. It is one thing to go after these institutions with a civil action, but the only way to let them know that you are serious is to call them before a Grand Jury.” O’Brien said, “There is no question in my mind that the officers of these banks and loan processing servicers made a conscious decision to commit fraud and participate in a scheme to deprive the public from knowing the true holder of their mortgage while at the same time avoiding paying billions of dollars in recording fees.  It is my opinion that they acted as a criminal enterprise, crossing state lines to commit their crimes and in most cases using the U.S. Postal Service to send these documents to registries of deeds, thereby committing mail fraud.  We need to know what they knew and when they knew it.  Until the CEOs who allowed these fraudulent activities to happen under their watch are sent to jail for what they did, these types of illegal behaviors will continue.”   Just last week, O’Brien’s Registry received 3 documents from Bank of America, all signed by a known robo-signer, Linda Burton.  O’Brien said, “If they are sending them to me, of all people, it is safe to assume that they are sending them to registries across the country.”  O’Brien refuses to record any documents signed by a robo-signer on his list unless those documents are accompanied by an affidavit attesting to the signature.  So far, he has not received one affidavit. “That clearly shows me that those documents were in fact fraudulent.”  O’Brien said that if he or anyone else went into one of these major banks and forged a signature on a loan document they would be arrested and sent into jail.  So it begs the question, why haven’t these CEO’S been held accountable? O’Brien cited the case of the individual who walked into a Walmart and tried to make a purchase using a fraudulent One Million Dollar bill.  He was arrested and charged with attempting to obtain property by false pretence and uttering a forged instrument.  O’Brien said, “As far as I am concerned, this is what these banks have been doing for years.  Make no mistake, MERS and its member-banks are taking people’s homes using fraudulent documents and that is something we do not do in America.” In addition, O’Brien is zeroing in on the major foreclosure law firms that he believes have acted as a co-conspirator in flooding the registries of deeds with these fraudulent instruments.  “These attorneys should know better. They have acted as co-conspirators in perpetrating this fraud.  I am sending a letter to the Massachusetts Board of Bar Overseers asking that they conduct an independent investigation into the activities of these firms. Unlike our Massachusetts Attorney General Martha Coakley, I understand that there are other Attorneys General and other public officials across the country who would like nothing better than to sweep this matter under the rug and grant these lenders, loan servicing companies and their foreclosure-mill attorneys immunity for the damage that they have caused, not only to our economy but to people’s property rights.  They would be willing to accept pennies on the dollar, a slap on the wrist, and a promise to never do it again.  If that should happen, it would be the biggest sellout of the American People that I have ever seen.  It would send the wrong message that the big boys can get away with anything.  As I have been saying all along, they may think they are too big to fail, but as far as I am concerned, they are not to big to go to jail. The top officials at MERS, its member-banks, servicers and foreclosure-mill attorneys must be prosecuted and held accountable for their fraudulent schemes that brought profits to their institutions by cutting corners, circumventing land recordation systems through fraud, uttering and forgery.”

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© 2010-12 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.
www.StopForeclosureFraud.com

For part 1 go here

Abigail Field-

My last post detailed how the Justice Department abandoned the principle of equality before the law in its Financial Meltdown enforcement efforts. This post focuses on Justice’s efforts–and lack thereof–to defend our legal system and the rule of law it relies on.

The Buck Stops with Holder and Obama

[REALITY CHECK]

© 2010-12 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.
www.StopForeclosureFraud.com

An 11th-hour settlement is expected to stave off potential class action status in a lawsuit that claims foreclosed borrowers were overcharged for attorneys’ fees that the Mortgage Electronic Registration Systems Inc. did not actually incur.

National Mortgage News-

The plaintiffs, Jose and Lorry Trevino, filed a motion seeking class action status and an amended complaint on Jan. 12. The defendants had until Jan. 17 to respond, but received a two-week extension, “so that the parties can memorialize their settlement,” according to court documents filed Jan. 13.

The parties have agreed to terms, but the settlement is pending final paperwork. The case hasn’t been dismissed and likely won’t until the settlement is finalized.

The suit, originally filed in 2007, names Merscorp and a number of its shareholders, including Citigroup, Countrywide, Fannie Mae, Freddie Mac, GMAC Residential Funding, HSBC, JPMorgan Chase, Washington Mutual and Wells Fargo.

[NATIONAL MORTGAGE NEWS]

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Washington, DC (Jan. 18, 2012) – Rep. Elijah E. Cummings, Ranking Member of the House Committee on Oversight and Government Reform, and Committee Member John F. Tierney sent a letter today to Chairman Darrell Issa requesting that he issue a subpoena to the Federal Housing Finance Agency (FHFA) compelling the production of all documents associated with its analyses of whether mortgage loan modifications with principal reductions should be offered by Fannie Mae and Freddie Mac. 

During questioning from Tierney at a Committee hearing on November 16, 2011, FHFA Acting Director Edward DeMarco testified that programs to reduce mortgage principal do not serve the long-term interests of taxpayers when compared to foreclosure. DeMarco testified that FHFA had conducted analyses supporting this conclusion, and he committed under oath to provide materials relating to these analyses to the Committee.

On November 30, 2011, Cummings and all Democratic Members of the Committee sent a letter to DeMarco requesting that he provide these documents by December 9, 2011. Despite numerous written and oral follow-up requests, however, DeMarco has failed to provide them to date.

“Given Mr. DeMarco’s failure to produce to the Committee the documents he committed under oath to provide and the call by Federal Reserve officials for the implementation of loan modification programs that include principal reduction to address the ongoing housing crisis, we believe we are left with no option but to compel Mr. DeMarco’s compliance,” Cummings and Tierney wrote to Issa. “For these reasons, we request that you issue a subpoena demanding these documents, or that you schedule a business meeting so Members may vote to authorize a subpoena in order to obtain these documents.”

Below is the full letter:

January 18, 2012

The Honorable Darrell E. Issa
Chairman
Committee on Oversight and Government Reform
U.S. House of Representatives
Washington, DC 20515

Dear Chairman Issa:

        We write today to request that you issue a subpoena to the Federal Housing Finance Agency (FHFA) compelling the production of all documents associated with its analyses of whether mortgage loan modifications with principal reductions should be offered by Fannie Mae and Freddie Mac.  During a hearing before the Committee on November 16, 2011, the Acting Director of FHFA, Edward DeMarco, committed under oath to provide these materials to the Committee.  Despite numerous written and oral follow-up requests, however, Mr. DeMarco has failed to provide them.

        During the Committee’s hearing in November, Rep. John Tierney asked Mr. DeMarco whether he had determined, as a matter of policy, that it was preferable to foreclose on properties rather than offer loan modifications that include principal reductions, even if foreclosures resulted in greater losses to FHFA and U.S. taxpayers than would be associated with principal reductions.  In response to Rep. Tierney’s question, Mr. DeMarco stated:

We have been through the analytics of the underwater borrowers at Fannie and Freddie, and looked at the foreclosure alternative programs that are available, and we have concluded that the use of principal reduction within the context of a loan modification is not going to be the least-cost approach for the taxpayer.

        At the conclusion of his questioning, Rep. Tierney asked Mr. DeMarco to provide both the statutory authority for his claim that FHFA is prohibited from allowing principal reduction programs, as well as any analysis that FHFA conducted demonstrating that foreclosures always serve taxpayer interests when compared to principal reductions.  Specifically, Rep. Tierney stated:

What you’re telling me flies in the face of all these people who have come up with a quite different idea. … I’d like you to do two things for the Committee if you would.  First, I want you to identify anywhere in the statute that specifically prohibits you from developing principal reduction programs. … [S]econd, I’d like you to submit whatever analysis you have done that shows why reducing the principal on some mortgages is worse for the United States taxpayer than foreclosure.

        In response to Rep. Tierney’s request, Mr. DeMarco committed under oath to provide these documents, stating:  “We can provide that information as you suggested, Congressman.”

        In order to follow-up on this request, all Democratic members of the Committee sent a letter to Mr. DeMarco on November 30, 2011, making clear what information he should provide to the Committee.  The letter requested that he produce:

1.      “the statutory provision you believe prohibits the Federal Housing Finance Agency (FHFA) from allowing Fannie Mae and Freddie Mac to reduce mortgage principal in all cases”; and
2.      “the analysis you conducted, including the data you examined, demonstrating that principal reduction never serves the long-term interests of the taxpayer when compared to foreclosure.”

        We requested that this information be provided by December 9, 2011, but Mr. DeMarco has failed to provide even a single document.  Minority staff have made repeated inquiries to Mr. DeMarco’s staff about the status of the document production, but they have failed to provide any indication of when he plans to comply.

        While Mr. DeMarco has failed to provide supporting documents demonstrating why a principal reduction program is not in the best interest of taxpayers, economists are increasingly announcing their support for such a program.  For example, over the past several months, officials with the Federal Reserve have made strong public statements supporting principal reduction.  On January 4, Federal Reserve Chairman Bernanke issued a white paper to Congress that stated:

Principal reduction has the potential to decrease the probability of default (and thus the deadweight costs of foreclosure) and to improve migration between labor markets.  Principal reduction may reduce the incidence of default both by improving a household’s financial position, and thus increasing its resilience to economic shocks, and by reducing the incentive to engage in “strategic” default (that is, to default solely based on the household’s underwater position rather than on the affordability of the payments).

On December 16, 2011, during a hearing before the Subcommittee on TARP, Financial Services and Bailouts of Public and Private Programs, the President of the New York Federal Reserve Bank, William Dudley, also called for implementation of a targeted principal reduction program to bolster the nation’s economic recovery and serve the long-term interests of U.S. taxpayers.  President Dudley explained:

[w]e think that you can devise a program that, for home buyers that have mortgages that are under water, to incent them to continue to pay on those mortgages by giving them some program of principal reduction.  Obviously the devil’s in the details, so you have to have good program design.  But we are confident that one can design a program, which would be net beneficial—net positive—to the taxpayer.

        The recent statements in support of principal reduction issued by Chairman Bernanke and President Dudley follow similar public statements issued by Neil Barofsky, former Special Inspector General for TARP; Alan Blinder, former Vice Chairman of the Federal Reserve; and Mark Zandi, Chief Economist, Moody’s Analytics.  

Given Mr. DeMarco’s failure to produce to the Committee the documents he committed under oath to provide and the call by Federal Reserve officials for the implementation of loan modification programs that include principal reduction to address the ongoing housing crisis, we believe we are left with no option but to compel Mr. DeMarco’s compliance.  For these reasons, we request that you issue a subpoena demanding these documents, or that you schedule a business meeting so Members may vote to authorize a subpoena in order to obtain these documents.

        If you have any questions, please contact Lucinda Lessley at (202) 225-5051.  Thank you in advance for your attention to this matter.  

Sincerely,

_________________________                         _________________________

Elijah E. Cummings                                               John F. Tierney

Ranking Member                                                   Member

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