In The Matter Of:

MBIA INSURANCE CORPORATION
v.
COUNTRYWIDE HOME LOANS, INC
______________________________
BRIAN T. MOYNIHAN – Vol. 1
May 2, 2012
______________________________

HIGHLY CONFIDENTIAL

[ipaper docId=114667805 access_key=key-1lyg4654uxfx3i8rvitd height=600 width=600 /]

Rolling Stone-

Thank God for Bank of America CEO Brian Moynihan. If you’re a court junkie, or have the misfortune (as some of us poor reporters do) of being forced professionally to spend a lot of time reading legal documents, the just-released Moynihan deposition in MBIA v. Bank of America, Countrywide, and a Buttload of Other Shameless Mortgage Fraudsters will go down as one of the great Nixonian-stonewalling efforts ever, and one of the more entertaining reads of the year.

In this long-awaited interrogation – Bank of America has been fighting to keep Moynihan from being deposed in this case for some time – Moynihan does a full Star Trek special, boldly going where no deponent has ever gone before, breaking out the “I don’t recall” line more often and perhaps more ridiculously than was previously thought possible. Moynihan seems to remember his own name, and perhaps his current job title, but beyond that, he’ll have to get back to you.

The MBIA v. Bank of America case is one of the bigger and weightier lawsuits hovering over the financial world. Prior to the crash, MBIA was, along with a company called Ambac, one of the two largest and most reputable names in what’s called the “monoline” insurance business.

[ROLLING STONE]

Household Debt and Credit Developments in 2012 Q31

Aggregate consumer debt fell again in the third quarter, by $74 billion, continuing the nearly four-year downward trend in household debt. As of September 30, 2012, total consumer indebtedness was $11.31 trillion, 0.7% lower than its level in the second quarter of 2012 and down $1.37 trillion from the 2008Q3 peak.

Mortgages, the largest component of household debt, continue to drive the decline in overall indebtedness. Mortgage balances shown on consumer credit reports continued to drop, and now stand at $8.03 trillion, a 1.5% decrease from the level in 2012Q2. Home equity lines of credit (HELOC) balances dropped by $16 billion (2.7%).

Non-mortgage household debt balances jumped by 2.3% in the third quarter to $2.7 trillion, boosted by increases of $18 billion in auto loans, $42 billion in student loans, and $2 billion in credit card balances.

[…]

[ipaper docId=114653201 access_key=key-1szgyx86wt5stz3ukgbt height=600 width=600 /]

Wait until all the robo-signed documents that were put on hold eventually make it out to the market and play catch up. Also thanks to the elections for pretending home values were on a rise…but then again they also took plenty of REO’s off the market.

The Real Estate market is RIGGED!

Seeking Alpha-

Pater Tenebrarum put it bluntly in his Seeing Alpha article, “The real estate market is totally out of whack and predictability is now a plaything of unpredictable intervention.” He went on to examine whether we are in another bubble. His articles rang true based on my experiences as a Las Vegas real estate investor.

The Las Vegas housing market appears to be in great shape. According to the Greater Las Vegas Realtors Association, the median price in October 2012 was $140,000, up 15.7% from a year ago. Furthermore, homes are flying off the shelves with 55% sold within 30 days of being on the market, and 14.6% sold within 31-60 days. However, there are two significant indicators that tell us that the Las Vegas real estate market is not in good health:

• Absorption Rate. 2012 price increases are a direct result of an artificially generated supply-demand imbalance, which results from government intervention. A balanced market’s absorption rate is typically between 5-7 months, however, in some areas the Las Vegas absorption rate is below one month. It is a seller’s market with multiple bids on most properties pushing up prices.
• Pending Supply. A healthy market does not have more than one month of pending supply. This pending supply, or shadow inventory, consists of distressed properties not currently listed that are 90 days or more delinquent, those in foreclosure and real estate owned by lenders (REOs). With over two thirds of homeowners upside down on their mortgage, and as many as 75,000 homeowners more than 30 days late on their loans it is reasonable to conclude that there is well over a year of pending supply – more than 12 times that of a healthy market. This is based on the assumption that 36,000 homes is equivalent to one’s year’s supply since Las Vegas has been absorbing an average of just over 3,000 homes a month since 2009.

These two indicators are linked: as the pending supply increases the rate at which it comes to market, the absorption rate will increase and constrained supply will be removed as an upward pressure on prices. So the question on the minds of cautious investors is when will the supply increase, and will it lead to lower prices?

[SEEKING ALPHA]

HuffPO-

Richard Castaldo fought for his life 13 years ago, after he was shot eight times during the Columbine High School massacre. Now he’s fighting to save his home.

The survivor, who will spend the rest of his life in a wheelchair as a result of the shooting, moved to Los Angeles five years ago to pursue a career in music, only to fall behind on mortgage payments for his condo, NBC Los Angeles reports. He may have again found help in the form of Occupy Los Angeles.

“I feel like they’re really the only group that doesn’t have an ulterior motive,” said Castaldo, who admits he “should have known better” than to believe the value of his condominium would go up. Roughly 36,000 California housing units received a foreclosure filing in October, according to RealtyTrac.

[HUFFINGTON POST]

image: tumblr.com

Bloomberg-

Paul Ceglia was indicted on charges he faked evidence to support his claims that he signed a contract with Facebook Inc. (FB) Chief Executive Officer Mark Zuckerberg giving him a multibillion-dollar share in the world’s biggest social network,

Ceglia was arrested and charged last month in a criminal complaint with one count each of wire fraud and mail fraud, and was accused of the same crimes by a New York federal grand jury, according to an indictment released yesterday by U.S. Attorney Preet Bharara in Manhattan.

Ceglia, 39, doctored a legitimate 2003 contract with Zuckerberg, in which the future CEO agreed to perform coding work for Ceglia’s website, into a phony contract “in which Zuckerberg agreed to provide Ceglia with at least a 50 percent interest in Facebook,” according to the indictment.

[BLOOMBERG]

If Neil does not get this opportunity, this goes to show you another 4 years of free passes.

Nov. 27 (Bloomberg) — Neil Barofsky, former special inspector for the U.S. Treasury’s Troubled Asset Relief Program and Bloomberg Television contributing editor, talks about the selection of Elisse Walter to head the Securities and Exchange Commission. Barofsky, speaking with Tom Keene and Sara Eisen on Bloomberg Television’s “Surveillance,” also discusses U.S. banking regulations. Stephen Roach, a professor at Yale University, also speaks. (Source: Bloomberg)

This is the same crap that’s going to happen with every lender/ceo and the government knows this.

American Banker-

A series of lawsuits that charge some of the nation’s biggest banks with misleading investors in connection with the sale of hundreds of billions of dollars of mortgage-backed securities may come down to a question of timing.

The U.S. Court of Appeals for the 2nd Circuit on Monday was slated to hear arguments in an appeal brought by UBS (UBS) in its legal dispute with the Federal Housing Finance Agency. It claims that the FHFA waited too long to file suits that charged UBS and other underwriters with misconduct in the sale of securities backed by residential mortgage loans that Fannie Mae and Freddie Mac purchased over a roughly two-year period beginning in 2005.

[AMERICAN BANKER]

Be sure to read this post: BRUTAL & UGLY: Top Bank Lawyer’s E-Mails Show Washington’s Inside Game and decide if this one reason for her stepping down?

BFF’s? Elisse Walter was an executive vice president at the Financial Industry Regulatory Authority, where Schapiro was chairman and chief executive officer before rejoining the SEC.

Do you think this was the right choice? Oh and did you know Her husband runs antitrust policy for GE, a massive financial services company. h/t Matt Stoller

Why did Obama pass on Neil Barofsky or Sheila Bair? Never-mind we know the anwser.

Mary Schapiro will step down next month as U.S. Securities and Exchange Commission chairman, turning over the reins to Commissioner Elisse Walter in a move industry observers say will bring little change at the agency.

Schapiro, 57, who took the SEC’s top job in 2009 as it reeled amid public rebukes for failing to rein in Wall Street abuses, will leave the post Dec. 14, the agency said in a statement today. President Barack Obama named Walter to succeed Schapiro as the SEC navigates a flood of mandates from the 2010 Dodd-Frank Act and pursues efforts to overhaul regulation of money-market mutual funds and high-frequency trading.

[SF GATE]

Contact: Joy Yearout 517-373-8060

November 26, 2012

LANSING – Michigan Attorney General Bill Schuette today announced he charged Lorraine Brown, former president of mortgage document processor DocX, with racketeering for her alleged role in authorizing the fraudulent signing of mortgage documents filed in Michigan. The felony charge comes as the result of an ongoing Attorney General investigation into questionable mortgage documentation filed with Michigan’s Register of Deeds offices during the foreclosure crisis.

“Shortcuts like robo-signing are just one piece of the mortgage foreclosure crisis,” said Schuette. “Our investigation remains ongoing, and we will bring to justice every lawbreaker we find.”

In April 2011, Schuette launched an investigation after county officials across the state reported that they suspected Assignment of Mortgage documents filed in their offices may have been forged. A “60 Minutes” news broadcast had shown that the name “Linda Green” was signed to thousands of mortgage-related documents nationwide, but with many different variations in handwriting. County officials in Michigan reviewed their files and found similar documents, thus raising questions about the authenticity of the documents filed.

As part of his investigation, Schuette reviewed documents filed in Michigan and prepared by DocX, a document processing company located in Georgia. DocX processed mortgage assignments and lien releases for residential lenders and servicers nationwide. Schuette’s investigation revealed that former DocX president Lorraine Brown, 51, of Alpharetta, Georgia, allegedly established and orchestrated a widespread scheme of “robo-signing,” a practice in which employees were directed to fraudulently sign another authorized person’s name on mortgage documents in order to execute these documents as quickly as possible.

Internally, DocX identified this practice as “facsimile signing” or “surrogate signing.” Schuette alleges that from 2006 through 2009, these improperly executed documents were created and recorded at Brown’s direction. Schuette’s investigation revealed that more than 1,000 unauthorized and improperly executed documents were filed with county registers of deeds throughout Michigan.

Lorraine Brown has been charged with one count of Conducting Criminal Enterprises (Racketeering), a 20-year felony, in Kent County’s 61st District Court. Arrangements are being made for Brown to surrender to Michigan authorities, and arraignment will be scheduled at a later date.

In 2010, DocX suspended operations, halting its work as a mortgage document processor. Schuette noted that while the criminal charges against Brown address her role in the scheme, his office’s overall investigation into robo-signing remains ongoing and is not yet complete.

A criminal charge is merely an accusation, and the defendants are presumed innocent unless proven guilty.

[MICHIGAN.GOV]

UPDATE: From the press conference this am– This is about DocX criminal charges and Lorraine Brown, former Founder-President of DocX faces up to 20 years. AG Schuette’s office is still working on the arraignments. 

Michigan Attorney General Bill Schuette is holding a press conference Monday at 11 am to announce criminal charges in a significant case involving the mortgage foreclosure crisis.

H/T Click on Detroit

Recap:

FLORIDA: INDICTMENT & PLEA AGREEMENT | Lorraine Brown, Former Founder-President of DOCX Pleads Guilty

MISSOURI: Attorney General Koster announces plea agreement with Lorraine Brown – Former President of DocX to plead guilty for national mortgage document robo-signing practices

October 24, 2012

Abstract:     
This paper traces the history of mortgage laws in the US. I explore what led states to follow title or lien theory, to adopt a non-judicial foreclosure procedure, to have different redemption periods, and to restrict deficiency judgments. The availability of non-judicial foreclosure without significant restrictions is largely the result of path-dependent quirks in the wording of various proposed statutes and decisions of individual judges. States that experienced more farm foreclosures in the early 1930s are more likely to have tried to ban deficiency judgments. Finally, I find higher foreclosures during the 1930s in non-judicial foreclosure states.

“Nominee” – Only signs legal documents on the instructions of others. These nominee fronts conceal a wide variety of real owners, including those that are perfectly legal.

Does this not sound a lot like a company many financial institutions use to hold their name on legal documents as a Nominee or as a Beneficiary?

Sounds a lot like MERS…doesn’t it.

I’ve always said follow the money. 🙂

The Guardian-

The existence of an extraordinary global network of sham company directors, most of them British, can be revealed.

The UK government claims such abuses were stamped out long ago, but a worldwide joint investigation by the Guardian, the BBC’s Panorama and the Washington-based International Consortium of Investigative Journalists (ICIJ) has uncovered a booming offshore industry that leaves the way open for both tax avoidance and the concealment of assets.

More than 21,500 companies have been identified using this group of 28 so-called nominee directors. The nominees play a key role in keeping secret hundreds of thousands of commercial transactions. They do so by selling their names for use on official company documents, using addresses in obscure locations all over the world.

[THE GUARDIAN]

Yahoo-

Foreclosures, Ritholtz says, are now rising after banks had put many of them on hold to sort out the robo-signing debacle, and he’s “expecting that to continue to gather momentum.”

“I’m comfortable saying housing has stabilized, but I’m not buying the ‘we’re in a full-blown recovery’ meme,” he says.

By spring, we should know which side is right on housing — that is, whether a legitimate turn is upon the market or more weakness lies ahead, he says.

[YaHOO]

Foreclosures have become a raging fire, destroying whole communities in their wake. Tenants of foreclosed buildings often times have the least control over their situation. Here is a look at some rights that tenants do have during a foreclosure, and why we need to step even beyond these.

Libcom-

Take Back the Land is really united in two strategies that are intended to compliment each other: liberate empty bank owned homes and to defend families going through foreclosure. This type of foreclosure defense is not unique and is happening in organizations and coalitions around the country, from long standing community groups like City Life / Vida Urbana to the more recent Occupy Our Homes phenomenon. The execution of foreclosure defense is done along a course of research, and the beginning includes identifying homes that are in foreclosure or pre-foreclosure. This means checking city and county records and locating houses where the process has already begun. From here people will go about contacting the people currently living in those houses, often by arranging targeted canvassing to see if those people would like to resist their foreclosure and support their neighbors.

The entire system isn’t broken, It’s rigged!

by INETeconomicson

Part 2: How can we address corruption in academia? Charles Ferguson, the director of the new documentary film “Inside Job” says that we need limits to financial conflicts of interest in academia, as well as a disciplinary system

Everything and anything the banks do involve a Ponzi Scheme!

What exactly does the government define as a Ponzi?

Palm Beach Post-

Advocates say lenders often get a cut of ‘excessive’ premiums banks choose to replace lapsed homeowners policies.

An insurance controversy affecting hundreds of thousands of people in Florida and other states never touched Laura Digan’s world — until a $23,287.54 bill rocked it.

The “force placed” homeowners insurance imposed by her mortgage company after a policy lapsed was more than four times as expensive as prior coverage. The single mother of two in Palm Beach County said she was shopping for an alternative to last-resort insurer Citizens when the charge hit.

“I was absolutely appalled, horrified, shocked,” Digan said.

[PALM BEACH POST]

Palm Beach Post-

Florida homeowners have received more than $3 billion in mortgage relief and benefits from the nation’s five largest banks since a landmark settlement was signed in March to atone for foreclosure-related offenses.

But the majority of the banks’ debt forgiveness has come in the form of short sales, a gesture that homeowner advocates say doesn’t match the goal of the agreement, which was to keep borrowers in their homes.

More than $2.2 billion, or 63 percent of Florida’s total take so far from the settlement, has been in deficiency waivers for short sales, according to quarterly progress reports submitted this week to settlement monitor Joseph Smith.

A short sale is when a lender agrees to take less for a home than what the borrower owes on the mortgage. Banks can still pursue borrowers for that unpaid debt, unless they waive that right in the deal.

[PALM BEACH POST]

HuffPO-

On November 19th, the core of the Obama “Justice” Department’s “49 State Settlement,” of the millions of fraud claims by the suing mortgagees against the mega-banks who were trying to foreclose on robo-signed and other dubious mortgages, was finally announced, and it basically gave the mega-banks what they wanted: all of the money they could possibly get out of those mortgagees, and with future U.S. taxpayers furthermore absorbing the resulting losses, in the form of taxpayers needing to pay off the federal debt for the massive bailouts of Wall Street and its “counter-parties,” losses which were being absorbed by Timothy Geithner’s U.S. Treasury, and by Ben Bernanke’s U.S. Federal Reserve. There would be no prosecutions of mega-bank executives for any of the frauds those mega-bank executives had planned and overseen, which had led to these enormous crimes, and thus to the 2008 crash. Those mega-bank executives were permitted to keep their millions of dollars in pay and bonuses, which they had earned from these frauds.

In order to understand what was happening here, one needs to know first this relevant background, the back-story:

[…]

[HUFFINGTON POST]

AZ Family-

A Phoenix man is outraged that he found himself locked out of this own condo.

Kevin Hunter has a free and clear mortgage on his unit, since he paid cash. So he was shocked when he tried to get in one day, and his key didn’t work. New locks had been installed on his doors.

And now those new door locks have Hunter keyed up. “I’m mad,” he said. “It’s breaking and entering as far as I’m concerned!”

The locks come from his west Phoenix condo that he paid cash for years ago. He rents the condo out. But since he doesn’t currently have a tenant, only Hunter is supposed to have access inside.

[AZ FAMILY]

Decided on November 14, 2012

APPELLATE DIVISION : SECOND JUDICIAL DEPARTMENT
PETER B. SKELOS, J.P.
RUTH C. BALKIN
PLUMMER E. LOTT
ROBERT J. MILLER, JJ.
2011-05930
(Index No. 24113/10)

[*1]HSBC Mortgage Corporation (USA), appellant,

v

John Pascoe, etc., et al., defendants, Joseph P. Delgado, et al., respondents.

Phillips Lytle LLP, Buffalo, N.Y. (Preston L. Zarlock, Jennifer A.
Beckage, and Andrew J. Wells of counsel), for appellant.
The Dorf Law Firm, LLP, Mamaroneck, N.Y. (Jonathan B.
Nelson and Jessica J. Kastner of
counsel), for respondents.

DECISION & ORDER

In an action to foreclose a mortgage, the plaintiff appeals from an order of the Supreme Court, Kings County (Lewis, J.), dated April 15, 2011, which granted the motion of the defendants Joseph P. Delgado and Justine Fasciano for summary judgment dismissing the complaint insofar as asserted against them and to vacate a notice of pendency filed in connection with the subject property.

ORDERED that the order is affirmed, with costs.

The Real Property Actions and Proceedings Law provides, with respect to credit line mortgages, that a mortgagee of real property must execute a satisfaction of mortgage upon written request and full payment of the mortgage obligation (see RPAPL 1921[1]; HSBC Bank, USA v Pugkhem, 88 AD3d 649, 650). “A letter requesting that a mortgagee close a credit line and send a satisfaction of the mortgage . . . will satisfy the statutory requirement of a written request for a satisfaction” (HSBC Bank, USA v Pugkhem, 88 AD3d at 650 [citations omitted]; see Merrill Lynch Equity Mgt. v Kleinman, 246 AD2d 884, 885).

In support of their motion, inter alia, for summary judgment dismissing the complaint insofar as asserted against them, the defendants Joseph P. Delgado and Justine Fasciano (hereinafter together the moving defendants) demonstrated their prima facie entitlement to judgment as a matter of law dismissing the complaint insofar as asserted against them, and to vacate a notice of pendency filed in connection with the subject property, by establishing that the plaintiff accepted the payoff check, which was accompanied by a written request to close the line of credit and send a satisfaction of the mortgage (see RPAPL 1921[1]; Merrill Lynch Equity Mgt. v Kleinman, 246 AD2d at 885-886; cf. HSBC Bank, USA v Pugkhem, 88 AD3d at 651; Matter of Reitman v Wachovia Natl. Bank, N.A., 49 AD3d 759, 760). In opposition to the moving defendants’ prima facie showing, the plaintiff failed to raise a triable issue of fact (see Alvarez v Prospect Hosp., 68 NY2d 320, 326). [*2]

Contrary to the plaintiff’s contention, the moving defendants’ motion was not premature (see CPLR 3212[f]; Buchinger v Jazz Leasing Corp., 95 AD3d 1053; Savage v Quinn, 91 AD3d 748, 750).

The plaintiff’s remaining contention is without merit.

Accordingly, the Supreme Court properly granted the moving defendants’ motion for summary judgment dismissing the complaint insofar as asserted against them and to vacate the notice of pendency filed in connection with the subject property.

.
SKELOS, J.P., BALKIN, LOTT and MILLER, JJ., concur.

ENTER:

Aprilanne Agostino

Clerk of the Court

A FILM BY CHARLES FERGUSON

INSIDE JOB

DEVELOPED BY PROFESSOR FRANK PARTNOY, THE GEORGE E. BARRETT
PROFESSOR OF LAW AND FINANCE AT THE UNIVERSITY OF SAN DIEGO SCHOOL OF LAW

BUY HERE

[ipaper docId=114227880 access_key=key-pmujy0nhy8ljebayw0q height=600 width=600 /]