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State law requires all Delaware residents facing foreclosure to take part in the mandatory Delaware Foreclosure Mediation Program

State law requires all Delaware residents facing foreclosure to take part in the mandatory Delaware Foreclosure Mediation Program

Beau Biden-

Cape Gazette: Bankers now required to meet with homeowners

Thousands of homeowners in Sussex County still face the stress of foreclosure, but a new, mandatory program could help.

State law requires all Delaware residents facing foreclosure to take part in the mandatory Delaware Foreclosure Mediation Program administered by the Delaware Attorney General’s Office.

“Families are breaking up because of financial issues,” said Gerry Kelly, as he spoke at the Jan. 31 Sussex County Council meeting. “We are trying to calm families down, keep the temperature down, and let them know that free help is available.”

Kelly, a former Wilmington councilman and bank loan officer, is head of the Attorney General’s Foreclosure Prevention Office, which is part of the Consumer Protection Unit.

Kelly spends most of every day on the phone speaking with people in or facing foreclosure, and it’s a long list. In Sussex Count alone, there were 609 sheriff’s sales in 2011, compared to 397 in 2010 and 293 in 2009. There were nearly 1,200 foreclosure filings in 2011 in Sussex County, with more than 4,000 in Delaware. In all, more than 19,000 homeowners in Delaware have loans with past-due payments; about a third are in foreclosure.

The program, which started Jan. 19, offers owners of single-family homes a chance to meet face-to-face with their lenders to discuss alternatives to foreclosure. In a last-minute effort to beat the mediation deadline, 92 foreclosure complaints were filed in Sussex County from Jan. 1 to 18, with 38 of those filed the day before the Jan. 19 deadline.


© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.

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CT Foreclosure Mediation Law Carries 8-month Stay, MERS Not Working

CT Foreclosure Mediation Law Carries 8-month Stay, MERS Not Working


State lawmakers hope changes to a successful foreclosure mediation program will grant homeowners struggling to hold on to their property more time and greater piece of mind.

Under the new proposal, which needs to by signed by the governor, lenders cannot proceed with any legal action for eight months.

“A lot of people were able to work things out within three months,” said state Sen. Bob Duff, D-Norwalk, who helped enact the original mediation effort in 2008.

© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.

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What is Alter Ego Liability?

What is Alter Ego Liability?

THIS IS NOT Intended to Be Construed or Relied upon as COMPETENT LEGAL ADVICE—Readers are urged to obtain competent legal representation to review their facts. I am not an attorney and this is not legal advice. I’m trying to gather a few things in order for research…that’s all.

This is very similar to the notion of piercing the corporate veil (aside from certain technical distinctions that are being ignored for the purpose of this discussion). Owners of corporations (i.e., its shareholders) are generally not personally liable for debts, losses and liabilities of the business itself, because of limited liability. However, if those owners have acted in a way where their business is really just a shell, and not an entirely separate legal entity, a court may decide that the business is simply an alter ego, meaning the owners should be held personally liable because of their wrongful acts.

There are many things that a court will look at in determining whether alter ego liability should be applied. Typical factors include (but are not limited to) whether the company kept its own records, whether there were shares (for a corporation) or units (for an LLC) that were actually issued, whether the owners co-mingled their finances with the business entity, whether there were actually corporate directors or LLC managers running the business, how legal formalities were followed and whether the owners used the business for personal purposes. It is often a case-by-case situation, and the key here is that you should take every precaution to run your business in full compliance with the legally required formalities and use the business in a proper way in order to avoid such alter ego liability.

Uniform Fraudulent Transfer Act

Successor liability claims are often paired with alleged violations under a state law adaptation or adoption of the Uniform Fraudulent Transfer Act (“UFTA”),5such as the Delaware Uniform Fraudulent Transfer Act (“DUFTA”). Some typical factual scenarios that give rise to a successor liability claim mirror those for a claim under UFTA. For instance, a violation of DUFTA by transferring the assets of company A into company B to avoid liability, while the successor company B is a mere continuation of company A, as all of the assets were transferred, and company B retained the same management as company A, could trigger both exceptions three and four noted above as well as a fraudulent conveyance claim. See DEL. CODE ANN. tit. 6, § 1305.

DUFTA finds a fraudulent conveyance if the debtor made the transfer or incurred the obligation with “intent to hinder, delay or defraud any creditor of the debtor;” or “[w]ithout receiving a reasonably equivalent value in exchange for the transfer or obligation.” DEL. CODE ANN. tit. 6 §§ 1304(a)(2) and 1305(a); see also In re Hechinger Inc. Co. of Del., 327 B.R. 537, 551 (D. Del. 2005); China Res. Prods. (U.S.A.) v. Fayda Int’l, Inc., 856 F. Supp. 856, 863 (D. Del. 1994); In re MDIP, Inc., 332 B.R. 129, 132 (Bankr. D. Del. 2005). The debtor must also be engaged or about to engage in a business or a transaction for which the remaining assets of the debtor were “unreasonably small in relation to the business or transaction,” or intended, had a belief, or should have believed, that the debtor would “incur, debts beyond the debtor’s ability to pay as they became due.” In re MDIP, Inc., 332 B.R. at 132. If a creditor prevails on a claim under the DUFTA, the statute empowers the Court to appoint a receiver to take charge of the transferred asset or other property of the transferee. DEL. CODE ANN. tit. 6 § 1307(a).

Notably, intent under DUFTA can be found if the transfer or obligation was to an insider, if the debtor retained possession or control of the property transferred after the transfer, the transfer was of substantially all the debtor’s assets, the debtor removed or concealed assets, the debtor was insolvent or became insolvent shortly after the transfer was made or the obligation was incurred, the transfer occurred shortly before or shortly after a substantial debt was incurred, or the debtor transferred the essential assets of the business to a lienor who transferred the assets to an insider of the debtor. DEL. CODE ANN. tit. 6 § 1304(b). All of these facts, if present, would be useful in framing a successor liability claim as well.




Rafael X. Zahralddin-Aravena2
Elliott Greenleaf, Wilmington, Delaware

ALTER EGO liability



ALTER EGO DOCTRINE: ‘Pierce the Corporate Veil’

© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.

Posted in foreclosure, foreclosure fraud, foreclosures, forgeryComments (2)

ALTER EGO DOCTRINE: ‘Pierce the Corporate Veil’

ALTER EGO DOCTRINE: ‘Pierce the Corporate Veil’

A doctrine of law which disregards the principle of limited liability enjoyed by a corporate entity when it is proven that, in fact, no separate identity of the individual and corporation exists. The alter ego principle may also apply to relationships between corporate entities and their subsidiaries.

  • Litigants often invoke the alter ego doctrine but are rarely successful. Still, under the proper circumstances, it can be a powerful and effective equitable device for litigants before and after judgment.
  • Where the Creditor Directs Management of an Affiliated Transferee. Where the borrower has transferred title to a different entity controlled by the lender (or lenders, as the use of such entities at foreclosure is common in the participation setting), liability for an (unanticipated) uninsured loss often flows upward to the controlling parties anyway. Lender liability, alter-ego and other theories may be applied. See § (K)(1), infra (use of affiliates and  environmental liability). For a discussion of the liability of the affiliated secured lender, see Talley, § XIII(A)(3), supra.
  • Piercing the corporate veil in business is when a corporation performs an act through their officers or board of directors in good faith, so the company isn’t doing the deed themselves. In other words piercing the corporate veil has to do with the corporation through it’s officers and through the board of directors NOT acting in compliance with the corporation articles of incorporation and corporate bylaws require. And when they do that, they do that at the peril of the officers and the board of directors.

read more on this paper… HERE

© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.

Posted in bogus, chain in title, concealment, conflict of interest, conspiracy, CONTROL FRAUD, corruption, foreclosure, foreclosure fraud, foreclosures, investigation, mbs, mortgage, notary fraud, note, racketeering, RICO, Trusts, Wall StreetComments (9)

LPS Using TARP Funds to Cover-Up Assignment of Mortgage

LPS Using TARP Funds to Cover-Up Assignment of Mortgage

VIA: Adrian Lofton

Consumer ID thefts or consumer identity thefts is one of the main crimes that cause financial as well as emotional anguish. The rubber-stamping of Assignments of Mortgage and the Double Dipping of foreclosure fees and cost expedite the foreclosure process and line the silk pockets of these attorneys, banks and LPS executives.

This is a copy of the September 14, 2009 e-mail from Adrian Lofton to Bradley Johnson, lead Attorney at Taylor, Day, Currie, Boyd and Johnson apprizing him of their TARP fund violations.

Brad, your firm has created a conflict of interest by representing these banks. In addition to the aforementioned, you are not legally entitled to accept TARP funds to represent these banks after your firm implicated them in these federal violations.
continue reading…

[ipaper docId=19731605 access_key=key-lcitz7hu33tqlm9b248 height=600 width=600 /]

© 2010-19 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.

Posted in foreclosure fraud, Lender Processing Services Inc., LPS, tarp fundsComments (0)

Lassiter Notwithstanding: The Right to Counsel in Foreclosure Actions

Lassiter Notwithstanding: The Right to Counsel in Foreclosure Actions

Fast forward it’s getting much worse! Where are our rights heading??

ARTICLE: Lassiter Notwithstanding: The Right to Counsel in Foreclosure Actions

January / February, 2010

43 Clearinghouse Rev. 448


By John Pollock


As I write, 250,000 new households are going into foreclosure every three months. 1 In the first three months last year, 22 percent of homeowners were “underwater” (i.e., owed more than their homes were worth), while a third of home sales in the previous year were either short sales or purchase of bank-repossessed properties. 2 Few signs of improvement are on the horizon: 1.5 million foreclosures occurred in the first half of 2009 alone, and some estimate that 8.1 million mortgages will be in foreclosure over the next four years. 3 The result is a tidal wave of cases swamping the state and federal courts–cases whose sheer volume and procedural irregularities strain the promise of due process.

The shortage of legal assistance during this crush of “foreclosure actions” compounds the due process concerns: no state provides a statutory right to counsel in any foreclosure proceedings, and consequently more than half of foreclosed homeowners are handling their cases without counsel. 4 Yet having an attorney is critical: while even a delinquent borrower may have a variety of options (e.g., mediation, modification, relief under federal law, various state-law claims and defenses) only an attorney can evaluate the options properly and advise the homeowner as to the most efficacious strategy.

Establishing a Fourteenth Amendment right to counsel in foreclosure actions requires an advocate to contend with the U.S. Supreme Court’s decision in Lassiter v. Department of Social Services. 5 Where there is no threat to “physical liberty,” by which the Court meant incarceration, …

Copyright (c) 2010 by Sargent Shriver National Center on Poverty Law
Clearinghouse Review: Journal of Poverty Law and Policy

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