Jane Wardell, AP Business Writer, On Tuesday April 20, 2010, 6:40 am EDT
LONDON (AP) — Britain’s financial regulator launched a full-blown investigation into Goldman Sachs International on Tuesday after U.S. authorities filed civil fraud charges against its parent bank.
The announcement from the Financial Services Authority follows pressure for the probe from Prime Minister Gordon Brown, who expressed shock over the weekend at Goldman’s “moral bankruptcy.”
The British regulator said it would liaise closely with the U.S. Securities and Exchange Commission, which alleges that the bank sold risky mortgage-based investments without telling buyers that the securities were crafted in part by a billionaire hedge fund manager who was betting on them to fail.
The London-headquartered Goldman Sachs International, a principal subsidiary of Goldman Sachs Group Inc., said that “the SEC’s charges are completely unfounded in law and fact.” It said it looks “forward to cooperating with the FSA.”
British interest in the case is likely to focus on the Royal Bank of Scotland, which paid $841 million to Goldman Sachs in 2007 to unwind its position in a fund acquired in the takeover of Dutch Bank ABN Amro, according to the complaint filed in the United States.
The possibility that RBS might be able to recoup some money from Goldman Sachs helped boost the government-controlled bank’s shares, which were up 2.8 percent at midday.
The government holds an 84 percent stake in the bank, which nearly collapsed in large part because of its leadership of the consortium which took over the Dutch bank.
Fabrice Tourre, the Goldman Sachs executive named in the SEC lawsuit filed on Friday was moved to the bank’s London office at the end of 2008.
Analysts warn that damage from the case could hit other big banks as well, as the Goldman lawsuit puts the spotlight on the sector’s activities in the wake of the financial crisis.
Brown’s anger was fueled by reports over the weekend that Goldman Sachs still intended to pay out 3.5 billion pounds ($5.4 billion) in bonuses.
The British leader, who is facing a tough general election on May 6, said that the activities of banks “are still an issue.”
“They are a risk to the economy,” he said. “We have got to make sure they behave in a proper way.”
The opposition Conservative and Liberal Democrat parties, meanwhile, called on Brown to suspend Goldman from government work until the investigations are completed.
AP reporter Robert Barr in London contributed to this statement.
DJSP Enterprises, Inc. Announces Agreement to Acquire Timios, Inc., Expand Presence Into 38 States
Adds Established National Title Insurance Agency with Multiple Locations Across the US for Expansion of Cyclical Products and Services to the Real Estate and Mortgage Industries
By DJSP Enterprises, Inc.
PLANTATION, Fla., April 19 — /PRNewswire-FirstCall/ — DJSP Enterprises, Inc. (Nasdaq: DJSP, DJSPW, DJSPU), one of the largest providers of processing services for the mortgage and real estate industries in the United States, today announced it has signed a definitive agreement to acquire Timios, Inc., a national title insurance and settlement services company. Timios is a licensed title insurance and escrow agent operating in 38 States. Headquartered in Westlake Village, CA, with additional offices in Houston and Plano, Texas, Timios will provide DJSP Enterprises the capability to provide its customers a balanced portfolio of services including new loan origination, refinance and national REO closing and title. Additionally, Timios handles national loss mitigation services and pre-foreclosure title products from its multiple locations strategically placed for time-zone sensitive fulfillment.
Management expects that Timios, which uses advanced technology to produce a paperless environment, will aid DJSP Enterprises in its commitment to provide its customers with enhanced customer service in all lines of its business as it expands nationally. Timios presently services purchase money, refinance, reverse mortgage, REO and Deed-In-Lieu transactions for some of the largest lenders and servicers nationwide. Last year, Timios closed in excess of $500 million in residential real estate mortgage transactions, and as forecasted, is expected to more than double the volume in 2010. In addition, Timios has the capability to complete title searches for DJSP Enterprises’ growing REO liquidation business and loss mitigation business outside of Florida.
DJSP Enterprises will maintain Timios’ three offices while consolidating operations and back-office functions to streamline and reduce expenses.
David J. Stern, Chairman and Chief Executive Officer of DJSP Enterprises commented, “This acquisition significantly expands our capacity to effectively handle national services for our current client base. In addition it will support our cyclical expansion into other lines of the mortgage services business. In particular, our capacity to process national REO closings, refinance transactions, short-sale transactions, Deed in Lieu transactions, property reports, resale transactions, and multiple valuation products will be meaningfully expanded. Timios provides licenses for full settlement services in 38 states and we expect to obtain licenses in at least two additional states before the end of this year.
This acquisition further demonstrates our commitment to becoming the leading cyclical provider of products and services to the real estate and mortgage industries.”
“This transaction represents a great marriage of strengths and assets,” said Trevor Stoffer, president and CEO of Timios, Inc. “Our management teams could not ignore the obvious benefits to both organizations. DJSP Enterprises’ growth in the foreclosure space and our best in class technology and servicing of originations will create a very balanced portfolio. In addition, the financial support from DJSP Enterprises will allow Timios to grow from a boutique services company to a major player in settlement services with a complete offering for lenders.”
DJSP Enterprises will acquire Timios for $1.5 million in cash, 200,000 ordinary shares of DJSP Enterprises, and up to 100,000 ordinary shares of DJSP Enterprises to be earned upon achievement of defined performance metrics. Timios had revenue of $5.05 million for the last 12 months and DJSP Enterprises expects this acquisition to be accretive to earnings by the 3rd Quarter 2010.
The closing of the acquisition is subject to customary due diligence, closing conditions and regulatory approvals.
About DJSP Enterprises, Inc.
DJSP Enterprises is the largest provider of processing services for the mortgage and real estate industries in Florida and one of the largest in the United States. The Company provides a wide range of processing services in connection with mortgages, mortgage defaults, title searches and abstracts, REO (bank-owned) properties, loan modifications, title insurance, loss mitigation, bankruptcy, related litigation and other services. The Company’s principal customer is the Law Offices of David J. Stern, P.A. whoseclients include all of the top 10 and 17 of the top 20 mortgage servicers in the United States, many of which have been customers for more than 10 years. The Company has approximately 1,000 employees and contractors and is headquartered in Plantation, Florida, with additional operations in Louisville, Kentucky and San Juan, Puerto Rico. The Company’s U.S. operations are supported by a scalable, low-cost back office operation in Manila, the Philippines that provides data entry and document preparation support for the U.S. operation.
Forward Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, about DJSP Enterprises, Inc. and Timios, Inc. Forward looking statements are statements that are not historical facts. Such forward-looking statements, based upon the current beliefs and expectations of the Company’s management, are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: business conditions; changing interpretations of generally accepted accounting principles; outcomes of government or other regulatory reviews, particularly those relating to the regulation of the practice of law; the impact of inquiries, investigations, litigation or other legal proceedings involving the Company or its affiliates, which, because of the nature of the Company’s business, have happened in the past to the Company and the Law Offices of David J. Stern, P.A.; the impact and cost of continued compliance with government or state bar regulations or requirements; legislation or other changes in the regulatory environment, particularly those impacting the mortgage default industry; unexpected changes adversely affecting the businesses in which the Company is engaged; fluctuations in customer demand; the Company’s ability to manage rapid growth; intensity of competition from other providers in the industry; general economic conditions, including improvements in the economic environment that slows or reverses the growth in the number of mortgage defaults, particularly in the State of Florida; the ability to efficiently expand its operations to other states or to provide services not currently provided by the Company; the impact and cost of complying with applicable SEC rules and regulation, many of which the Company will have to comply with for the first time after the closing of the business combination; geopolitical events and changes, as well as other relevant risks detailed in the Company’s filings with the U.S. Securities and Exchange Commission, (the “SEC”), including its report on Form 20-F for the period ended December 31, 2009, in particular, those listed under “Item 3. Key Information – Risk Factors.” The information set forth herein should be read in light of such risks. The Company does not assume any obligation to update the information contained in this press release.
By EAMON JAVERS & MIKE ALLEN | 4/19/10 8:14 PM EDT
Updated: 4/19/10 10:03 PM by POLITICO
Goldman Sachs is launching an aggressive response to its political and legal challenges with an unlikely ally at its side — President Barack Obama’s former White House counsel, Gregory Craig.
The beleaguered Wall Street bank hired Craig — now in private practice at Skadden, Arps, Slate, Meagher & Flom — in recent weeks to help in navigate the halls of power in Washington, a source familiar with the firm told POLITICO.
“He is clearly an attorney of eminence and has a deep understanding of the legal process and the world of Washington,” the source said. “And those are important worlds for everybody in finance right now.”
They’re particularly important for Goldman.
On Friday, the SEC charged the firm with securities fraud in a convoluted subprime mortgage deal that took place before the collapse of the housing market. Next week, Goldman Sachs CEO Lloyd Blankfein will face questions from the Senate Permanent Subcommittee on Investigations, which is looking into the causes of the housing meltdown, the source said.
In Craig, Goldman Sachs will have help from a lawyer with deep connections in Democratic circles.
Craig served as White House counsel during the first year of Obama’s presidency, but is seen as having been pushed out for his role in advocating a strict timeline for the closing of the U.S. detention facility at Guantanamo Bay. His departure frustrated many liberal Obama supporters who saw Craig as a strong advocate for undoing some of what they saw as the worst excesses of the Bush era.
But the source familiar with Goldman’s operations said Craig wasn’t hired just because he’s well-connected.
“It’s about advice and process,” the source said. “People will always leap to the conclusion that it’s about somebody’s Rolodex.”
Skadden declined to comment on Craig’s role with Goldman.
“A former White House employee cannot appear before any unit of the Executive Office of the President on behalf of any client for 2 years—one year under federal law and another year under the pledge pursuant to the January 2009 ethics E0,” said a White House official.
The official also said that the White House had no contact with the SEC on the Goldman Sachs case. “The SEC by law is an independent agency that does not coordinate with the White House any part of their enforcement actions.”
Whatever the reason for his hiring, Craig will presumably be a key player in the intricate counterattack Goldman Sachs officials in Washington and Manhattan improvised during the weekend — a plan that took clearer shape Monday as Britain and Germany announced that they might conduct their own investigations of the firm.
For three weeks, Goldman had planned to hold a conference call Tuesday to unveil its first-quarter earnings for shareholders. Shifting into campaign mode after the SEC’s surprise fraud filing, Goldman has moved the call up from 11 a.m. to 8 a.m. to try to get ahead of the day’s buzz. In an unusual addition, the firm’s chief counsel will be on the line to answer questions about the case, and Goldman is inviting policymakers and clients to listen to the earnings call themselves rather than rely on news reports.
Industry officials said the conference call — which will include, as originally planned, Chief Financial Officer David Viniar — will amount to a public unveiling of Goldman’s crisis strategy.
But the linchpin of that plan is already clear: An attempt to discredit the Securities and Exchange Commission by painting the case as tainted by politics because it was announced just as President Barack Obama was ramping up his push for financial regulatory reform, including a planned trip to New York on Thursday.
“The charges were brought in a manner calculated to achieve maximum impact at point of penetration,” a Goldman executive said.
Among the points Greg Palm, co-general counsel, plans to emphasize on the call is “how out of the ordinary the process was with the SEC,” the executive said. The SEC usually gives firms a chance to settle such charges before they are made public. Goldman executives say they had no such chance,and learned about the filing while watching CNBC.
With a monstrous problem and mammoth resources, the iconic firm is paying for advice from a huge array of outside consultants, including such top Washington advisers as Ken Duberstein and Jack Martin, founder of Public Strategies.
The basic plan: Make a tough, factual case without coming off as arrogant or combative and without souring the firm’s image even further.
Partly because of the firm’s belief that it has become an easy target, no Goldman officials have appeared on television since the SEC announced its case.
The firm thinks it can be more effective if others make its case. On CNBC’s “Squawk Box” on Monday, Andrew Ross Sorkin of The New York Times, who gets special attention from Goldman spinners, raised questions about the substance of the SEC’s case. Shortly thereafter, Sen. Judd Gregg of New Hampshire, the top Republican on the Senate Budget Committee, said he is “a little interested in the timing” of the case.
Reflecting a high-stakes balance for the unpopular investment bank, Goldman plans to stop short of a frontal attack. Instead, it is raising questions and feeding ammunition to allies.
“We don’t want to come across as being arrogant and above it all,” said a Goldman executive who insisted on anonymity. “The SEC is the major regulator of several of our businesses. Being at war with them is not the goal.”
Therefore, an official said, a key Goldman message in the days ahead will be, “We’re not against regulation. We’re for regulation. We partner with regulators.”
Goldman said its most important audience is its client base, from CEOs all over the world to pension-fund managers to entrepreneurs who use the firm’s private wealth-management services. The firm sent its staff two pages of talking points giving basic facts — and the official line — about the SEC case: “Goldman Sachs Lost Money on the Transaction … Objective Disclosure Was Provided.”
The less official message, according to one executive: “Don’t believe everything you read in the complaint. Don’t believe everything you read in the press.”
The official said clients have been sympathetic.
Other audiences include the news media and governments around the world, with Goldman reaching out Tuesday to politicians in Europe, Japan, the U.S. and everywhere in between.
Goldman pays extraordinary attention to its alumni network because so many of its former officials are in visible, powerful positions. An official said the firm tries “to empower them with information,” so that when they’re put on the spot about the Goldman case, they can say, “I’m not there, but let me tell you a few things I’ve been told.”
In courtrooms across the country, judges are foreclosing on homes based on improperly prepared documentation, some of which may even be fraudulent. At the heart of the problem are entities like Mortgage Electronic Registration System (MERS), which itself is owned by many of the largest financial institutions in the U.S. If MERS and other similar firms acting as foreclosing entity were required to show legal proof of mortgage assignment, the documentation offered could reveal a lack of capitalization that would make the bank bailout look like lunch money.
Imagine you are a judge in a state court mortgage foreclosure part, or maybe in a bankruptcy court.
Your experience and training tells you what is supposed to happen. An originator of a mortgage, with the actual wet ink documents in hand and full knowledge of the transaction, makes MERS the nominee for the holder of the mortgage and records the mortgage in MERS’s name and gives physical custody of the wet ink documents to MERS. The originator then assigns the mortgage and note to Bank. Bank, with full knowledge of the assignment transaction, may assign it further, perhaps into a trust to back up Residential Mortgage Backed Security (RMBS). All of this would be done with proper notice to MERS who would always be up to date on who is the most recent assignee of the mortgage. When the time comes to foreclose, MERS would release the wet ink documents to the lawyers for the last assignee, who would use those original documents to foreclose.
Now comes into your court, a party claiming to be the lender—or at least the lender’s successor in interest—saying that it has acquired the homeowner’s mortgage by assignment. The homeowner took out the mortgage 5 or 6 years ago from XYZ originator, but the loan was recorded at the county clerk’s office or local land office as being in the hands of MERS.. I have explained about MERS and other issues relating to sloppy mortgage document handling in prior posts.
Attached to the complaint is a document which, on its face, appears to be an assignment of the mortgage from MERS to plaintiff. It is signed by a person with an official looking title at MERS. So, would you be safe in assuming that the person who signed the assignment:
1) went and fetched this mortgage out of a file room at MERS;
2) checked it over to make sure it was properly assigned from the originator to MERS; and
3) that the party to which the assignment was about to made had paid for the right to own the mortgage, before executing the assignment?
No, you would not.
In the Aughts, during the rush to make loans and generate all those origination fees, front line lenders and mortgage brokers would zoom through paperwork and flip the mortgages immediately over to trusts and servicers. They didn’t always complete the paperwork to assign the mortgage over to either MERS or to the trust. The mortgage may have been filed with the county clerk as belonging to either MERS or to some mortgage back securities trust, but the actual assignment papers might never have been executed. And although money moved around from the servicers, originators and investors, paperwork indicating payment for the transfer of a particular mortgage was not always provided.
Nonetheless, servicers acted as if the loans had actually been paid for and properly assigned and sent out notices to homeowners saying that payments on a particular mortgage were now to be directed to this servicer. The homeowners paid the servicers who presumably forwarded on a net amount, less their servicing fees, to the investors in the Residential Mortgage Backed Securities (RMBS).
Then one day, the homeowner goes into default. The trustee for the trust that is supposed to be holding the mortgage for the benefit of the investors in the RMBS, springs into action and want s to foreclose. Well, actually, the servicer springs into action using the name and consent of the trustee — the servicer makes tons more in fees from foreclosure than it does from mortgage modification.
The servicer hires a law firm. The law firm will need an assignment document as proof that the trustee owns the note and has standing to foreclose. Where does the law firm get this assignment? Does the trustee contact MERS and ask for assignment? Does the trustee have to pay somebody to buy the note? Does MERS prepare the document and send it over?
In many instances, an employee of the servicer, or of a document mill executes hired by the servicer, creates and signs the assignment from the originator, indicating that he or she is an officer of the originator. Sometimes an employee of the law firm executes an assignment from MERS indicating that he or she is an officer of MERS.
In neither case, is it likely that the person executing the assignment has ever clapped eyes on the mortgage documents. Rarely, if ever, does the signer have any direct knowledge of whether any money has actually changed hands to effectuate the purchase of this mortgage by the entity which will be receiving it and foreclosing upon it. In order for someone to acquire rights under a note, they must be a “purchaser for value”.
Let me say this again. People who are not actually employees or officers of the originator, sign as if they are. People who don’t actually know if a loan was ever paid for, are executing documents as if they do. They are purporting to transfer mortgages from the originator to either MERS, or to an entity called the “depositor” who deposits the mortgage into a RMBS trust, or directly to a RMBS trust. People who are not employees of MERS are executing documents purporting to transfer mortgages — which may or may not have actually been properly transferred into MERS — from MERS to RMBS trusts.
AND NOBODY IS TELLING THE JUDGES OR THE HOMEOWNERS THAT THESE DOCUMENTS HAVE NO ACTUAL KNOWLEDGE BEHIND THEM.
I am not accusing the people who sign these things of deliberately lying, in the sense that you tell a deliberate falsehood knowing it to be false. I’m sure they “hope” the documents are accurate; they just have no way of knowing.
Click here to read about a law firm that creates, and has its own employees sign, assignments from MERS that it uses as exhibits in the cases it brings. Click here to read about a group of people signing on behalf of many different originators simultaneously.
Having read these articles about created assignments and a “clone army” of officers signing documents, courts should pay attention to the fact that the signatories are pretending to work for the GRANTOR — the original lender or someone in the chain. However, they are really being paid by the GRANTEE — the mortgage servicer working on behalf of the trust. Talk about your conflict of interest.
The signers have no personal knowledge as to the accuracy of anything they are representing.
So, when you, the judge, are presented with this complaint and the documents which purports to effect various assignments, how do you know if any of it is real? You don’t.
When things go wrong, as they sometimes will,
When the road you’re trudging seems all uphill,
When the funds are low and the debts are high,
And you want to smile, but you have to sigh,
When care is pressing you down a bit Rest if you
must, but don’t you quit.
Life is queer with its twists and its turns, As
everyone of us sometimes learns, And many a
failure turns about When they might have won,
had they stuck it out. Don’t give up though the
pace seems slow, You may succeed with
another blow.
Often the goal is nearer than,
It seems to a faint and faltering man,
Often the struggler has given up
When he might have captured the victor’s cup;
And he learned too late when the night came down,
How close he was to the golden crown.
Success is failure turned inside out The
silver tint of the clouds of doubt And
you never can tell how close you are,
It may be near when it seems so far;
So stick to the fight when you’re
hardest hit, It’s when things
seem worst that you
Dear Honorable Judges in Foreclosure and Bankruptcy Proceedings:
This letter concerns how a Jacksonville, Florida publicly-traded company, Lender Processing Services, Inc. solves Deutsche Bank National Trust Company missing documents in foreclosure cases. Deutsche Bank National Trust Company (“DBNTC”) is the plaintiff in the majority of foreclosure actions filed in thousands of counties in America since 2007. Deutsche Bank is sometimes referred to as “America Foreclosure King.” There is currently a Department of Justice investigation of LPS and its influence over law firms in foreclosure actions, according to an article in the Dow Jones Daily Bankruptcy Review on April 16, 2010.
In these foreclosure actions, DBNTC is usually acting as the trustee for a mortgagebacked securitized trust. This means that a securities company made a commodity out of approximately 5,000 mortgages that were bundled together. The notes in the trust have a face value of approximately $1.5 billion in each trust. Investors buy shares of these trusts. Deutsche Bank is the most common name in the business of being a Trustee for Mortgage-Backed trusts. Other banks very active in this role of Trustee include Wells Fargo, U.S. Bank, Citibank, Bank of New York, JP Morgan Chase and HSBC.
When each of these trusts was made, the securities company responsible for the securitization (often Financial Assets Securities Corporation in Greenwich, Connecticut) was supposed to have obtained mortgage assignments showing that the trust had acquired each mortgage and note from the previous owner, which was most often the original lender. The trust documents specify that the mortgages, notes and assignments in recordable from will have been obtained by the trust. Most mortgage-backed trusts included the following or equivalent language regarding Assignments:
Assignments of the Mortgage Loans to the Trustee (or its nominee) will not be recorded in any jurisdiction, but will be delivered to the Trustee in recordable form, so that they can be recorded in the event recordation is necessary in connection with the servicing of a Mortgage Loan.
Trustees take very few actions relating to the individual properties in the trust. Typically, the bank acting as a trustee for a mortgage-backed trust hires a mortgage servicing company to deal with issues involving the individual mortgages in the trust. The mortgage servicing companies in turn hire a “default management company” to foreclose when a homeowner defaults on payments on a loan that is part of the trust. Lender Processing Services in Jacksonville, Florida, is the largest mortgage default management company. Deutsche Bank National Trust Company uses several mortgage servicing companies, but most often uses American Home Mortgage Servicing, Inc. in Irving, Texas as its mortgage servicing company.
In tens of thousands of foreclosure cases filed by Deutsche Bank National Trust Company as trustee for a mortgage-backed trust, Deutsche Bank has not produced the mortgage, note or Assignment and instead has filed pleadings claiming that the original mortgage and note were inexplicably lost. In these cases, Deutsche Bank uses specially prepared Mortgage Assignments to show that they have the right to foreclose. These documents were often prepared by clerical employees of Docx, LLC, a subsidiary company of Lender Processing Services, the default management company. Hundreds of thousands of other Mortgage Assignments came from the LPS office in Dakota County, Minnesota. More recently, these documents were produced from the LPS offices in Jacksonville, Duval County, Florida. In thousands of other cases, LPS directs the law firms it hires to use the employees of the law firms to sign as officers of Mortgage Electronic Registration Systems to create the documents necessary for foreclosure
a) Mortgage Electronic Registration Services (MERS) is identified as the grantor and American Home Mortgage Servicing, Inc. is identified as the grantee; within days (or minutes), a second Assignment is filed, identifying American Home Mortgage Servicing, Inc. as the grantor and Deutsche Bank National Trust Company as trustee for the trust as the grantee;
b) a mortgage company no longer in existence is identified as the grantor and American Home Mortgage Servicing, Inc. is identified as the grantee; within days (or minutes), a second Assignment is filed, identifying American Home Mortgage Servicing, Inc. as the grantor and Deutsche Bank National Trust Company as trustee for the trust as the grantee;
c) a mortgage company no longer in existence is identified as the grantor and Deutsche Bank National Trust Company as trustee is identified as the grantee;
d) American Home Mortgage Servicing, Inc., purporting to be the “successor-in-interest” to Option One Mortgage Company, is identified as the grantor and Deutsche Bank National Trust Company as trustee is identified as the grantee;
e) Sand Canyon Corporation, formerly known as Option One Mortgage Company, is identified as the grantor and Deutsche Bank National Trust Company as trustee is identified as the grantee, with no further explanation of how both American Home Mortgage Servicing and Sand Canyon have authority to act for Option One Mortgage.
On several hundred thousand Assignments, the individuals signing as officers of the grantor were actually clerical employees of Lender Processing Services, the mortgage default management company hired by American Home Mortgage Servicing, Inc., working for the grantee – Deutsche Bank National Trust Company. On several hundred thousand Assignments, the very same individuals signed as officers of both the grantor and grantee.
In all of these hundreds of thousands of cases, no Assignment actually took place on the date stated and no consideration was paid by the grantee to the grantor despite the representations in the Assignments. Most significantly, no disclosure was ever made to the Court in the foreclosure or bankruptcy case or to the homeowners in default that the original Assignments to the Trust were never made – or were lost – or were defective and that the recently-filed Assignments were specially made to facilitate foreclosures years after the property was transferred to the trust.
An examination of the signatures on these Assignments shows that many are forgeries, with several different people signing the names Linda Green, Tywanna Thomas, Korell Harp, Jennifer Ohde, Linda Thoresen and many of the other names used on several million mortgage assignments, as I have reported in my article “Compare These Signatures.” Many of these same individuals use at least a dozen different job titles as I have reported in my article, “An Officer of Too Many Banks.” These articles are available at www.frauddigest.com.
Please do not hesitate to contact me for additional information.
Yours truly,
Lynn E. Szymoniak, Esq.
This article could also have been titled:
HOW LENDER PROCESSING SERVICES, INC. SOLVES U.S. BANK’S MISSING PAPERWORK PROBLEM IN FORECLOSURES
-or-
HOW LENDER PROCESSING SERVICES, INC. SOLVES WELLS FARGO MISSING PAPERWORK PROBLEM IN FORECLOSURES
-or-
HOW LENDER PROCESSING SERVICES, INC. SOLVES BANK OF NEW YORK MISSING PAPERWORK PROBLEM IN FORECLOSURES
-or-
HOW LENDER PROCESSING SERVICES, INC. SOLVES CITIBANK’S MISSING PAPERWORK PROBLEM IN FORECLOSURES
-or-
HOW LENDER PROCESSING SERVICES, INC. SOLVES HSBC’S MISSING PAPERWORK PROBLEM IN FORECLOSURES
For a copy of the Exhibits referenced below, please contact szymoniak@mac.com.
Copies of Assignments from MERS to American Home Mortgage Servicing, Inc. are attached hereto as Exhibit 1.
Copies of Assignments from American Home Mortgage Servicing Inc. to Deutsche Bank as Trustee are attached as Exhibit 2.
Copies of Assignments from American Brokers Conduit, a mortgage company no longer in existence at the time the Assignments were made, to Deutsche Bank as trustee are attached as Exhibit 3.
Copies of other Assignments to Deutsche Bank as Trustee signed by employees of Lender Processing Services, working for the grantee Deutsche Bank, but signing on behalf of the grantor mortgage companies or banks, or MERS as nominee for the grantor mortgage companies or banks, are attached as Exhibit 4.
Copies of Assignments from American Home Mortgage Servicing, Inc. as the successorin-interest to Option One Mortgage as grantor and Deutsche Bank as Trustee as the grantee are attached as Exhibit 5.
Copies of Assignments from Sand Canyon, formerly known as Option One Mortgage as grantor and Deutsche Bank as Trustee as the grantee are attached as Exhibit 6.
Copies of Assignments signed by employees of law firms working for Lender Processing Services on behalf of American Home Mortgage Servicing, Inc. and ultimately for grantee Deutsche Bank, where such employees signed as officers of MERS as grantor are attached as Exhibit 7.
Copies of Assignments signed by employees of Lender Processing Services on behalf of grantors and notarized in Duval County, Florida for grantee Deutsche Bank, filed by law firms working for Deutsche Bank are attached as Exhibit 8.
What just happened to Wall Street, with the announcement that the Securities Exchange Commission has filed fraud charges against Goldman Sachs Group, Inc., is so damning that its impact had to be blunted by its late Friday afternoon release. It’s what government does when it doesn’t want the stock market to plunge. But government DOES want to play up to the public’s infuriation over continuing revelations of greed and fraud on Wall Street.
A Monday morning release of this story might have sent the entire stock market into a crash (Goldman Sachs Group Inc, stock is down 23.57 points, erasing ~$12 billion of market capitalization), and that’s because there are likely more fraudulent billion-dollar investments to be revealed.
The American public needs to first grasp a broader view of this event. The Administration in Washington DC, heading for an election in November that will surely be fueled with voter outrage, has decided to strike a seeming blow to Wall Street to strengthen its hand in pushing for financial reform. Yet it is so odd that politicians were the ones who allowed all this to happen (more on this below). Does anyone have an explanation why the SEC has only now decided to file charges involving a 2007 billion-dollar investment? Or why the investor who most benefited financially and who assembled this mortgage-backed investment, John Paulson, has yet to be charged with any wrongdoing?
The smoking gun: an e-mail
John Paulson, the billionaire
Another piece of the intrigue here is that the primary provider of evidence in the case is a star Goldman Sachs trader, a Frenchman by birth, who has suddenly left the U.S. for Europe as this story hits the news outlets. Fabrice Tourre, a GS vice president, wrote an email in 2007 that is the smoking gun in this case. Did he leave the U.S. in fear for his life?
Mr. Tourre’s 2007 email, which said “the whole building is about to collapse now,” shortly before the bonds were sold, and which said he would be the only potential survivor, provides foreknowledge of the billion-dollar investment that was sure to fail. Tourre was “principally responsible” for piecing together this novel and new type of investment at GS. He was the point man for Paulson.
When Tourre produced a 65-page “flip book” that contained details of the billion-dollar investment, to be provided to potential investors, this provided the evidence that SEC needed for its case.
Fabrice Tourre, 31-year-old Goldman Sachs vice president, who is reported to have fled the country with the announcement that a 2007 email he wrote is the “smoking gun” in the SECs case against GS.
Don’t get the false impression that Mr. Tourre is a whistleblower here. The SEC alleges Mr. Tourre misled investors about Paulson’s role, saying Paulson had invested millions of dollars in hopes the packaged mortgage bonds would rise in value. Of course, Mr. Tourre is not the target of the SEC complaint, Goldman Sachs is. Its senior management had full knowledge of this deal. From 2004 to 2007, Goldman Sachs had arranged about two dozen similar deals.
Nor should anyone get the false notion that Paulson let others do all his bidding. He was actively raising funds and selling investment groups on this kind of instrument for some time, going back to 2006. Paulson wanted to invent the invincible wager.
An article in The Wall Street Journal documents that a senior banker at Bear Stearns Companies turned down this trade, questioning the propriety of selling deals to investors that a bearish client had assembled. (Bear market traders bet that an investment will fall in value, while bull-market traders bet than an investment will rise in value.)
Throw the book at them
Believe it or not, an entire book was written of this now infamous investment before the SEC took action.
Of interest is Greg Zuckerman, The Wall Street Journal’s senior reporter in this case, who wrote The Greatest Trade Ever, about this trade and others like it, long before the SEC took action. The jacket on this book says: “The behind-the-scenes story of how John Paulson defied Wall Street and made financial history.” The book, published in November of 2009, hardly made ripples on Wall Street or in the financial news press. The SEC was sitting on all this information for over two years and did nothing. It was waiting for the right political moment to strike.
Zuckerman’s book outlines how John Paulson assembled risky mortgage investments with another party, Goldman Sachs, investments that were sure to fail, and then bet against them. Goldman Sachs used its reputation to promote the packaged mortgage investment to an overseas investor without revealing it was in cahoots with Paulson. In fact, the overseas bank involved specifically said it would not proceed if the packaged mortgages had been assembled by Paulson.
Paulson made a killing – a billion dollars, and Goldman Sachs made millions assembling the deal from both sides. Paulson’s defense is that he made no misrepresentations, only Goldman Sachs did, but what of the ethics of this deal?
Yves Smith, author of Naked Capitalism, and head of Aurora Advisors, a management consulting group, and the author of the new book,Econned: How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism, calls the investment that John Paulson sponsored a “Trojan horse for Mr. Paulson to take a short position, betting against the very same investment he was creating, but his intent was not disclosed…. at the expense of investors who had been kept in the dark and would almost certainly have turned down the deal if they had had the full picture.”
Goldman Sachs living up to its now infamous reputation
It’s obvious now that Goldman Sachs will be the pin cushion for the Administration’s attempt to regain public credibility before the November election. Goldman Sachs is the villain, and it is doing a good job of playing this role.
Just prior to the revelations about the alleged Paulson/Goldman Sachs scandal, the SEC launched other charges against a Goldman Sachs director. Various news sources reported that Rajat Gupta of GS is being investigated on suspicion that he provided inside information to the Galleon Group, a hedge fund founded by Raj Rajaratnam that has now become the biggest insider-trading probe in many years. So the SEC could mire Goldman Sachs with even more allegations in an effort to bring the billion-dollar company to its knees.
This publicly-staged legal action resembles that of President Bill Clinton’s 1995 assault against the tobacco companies, which was launched under the guise of a threat to public health, but really had a political agenda – that of taking away millions of dollars of campaign funds that the tobacco industry was donating to the Republican Party at the time.
If you are as confused as everyone else what the SEC is fussing about, you might click here to take a peek at a graphic created by The Wall Street Journal which visually displays how the deal between John Paulson and Goldman Sachs was prearranged and marketed.
Of course, GS sees nothing wrong with this trade, which should ignite even further public outrage. GS needs a good public relations man at the moment as it digs an even deeper hole every time it attempts to defend its own actions. (Recall GS’ CEO Lloyd Blankfein who recently said he’s “doing God’s work.”)
Congress opened the door
To return to the government’s culpability in this case, the Commodities Futures Modernization Act which Congress passed a decade ago, opened the door for trades like John Paulson’s. This legislation eliminated the long-standing rule that derivatives bets made outside regulated exchanges are legally enforceable only if one the parties involved in the bet were hedging against a pre-existing risk. Prior regulations said the only people who can bet against an investment actually have to own shares in it. Here is Paulson betting against an investment he had no ownership in.
Or like Rick Edelson, an online blogger speaking out in the New York Times, says: “Like the arsonist who buys insurance on another man’s house, Goldman and Paulson did everything they could to burn down the American economy, because it was only by destroying others’ wealth that they could maximize their own profit.”
Good God, do these men see in their greed they have scuttled the American economy, as well as faith in Wall Street investments that fund most pension plans?
When Paulson made billions, Wall Street was not quick to condemn. He got away with it, and that was to be applauded. Some investment bloggers said “well done.” Another said Paulson is “an investing stud. He is to be hailed for his moxie and superior forecasting.”
Other defenders of Wall Street claim Paulson didn’t create a real estate market with collapsing home values. But to package non-performing mortgages and then bet against them is like a rigged horse race.
Scripting for a thrilling end
For sure, the Administration in Washington DC will be portrayed in coming months as the hero, rescuing the public from the blood-suckers on Wall Street. Be it government to save us all from problems it created and then pin a badge of honor on itself. The current and former administrations in Washington DC are, and have been, so tightly controlled and managed by Wall Street, even with its ex-CEOs strategically implanted within the Executive Branch, as to call all alleged reforms and sanctions into question. These are just for show.
Goldman Sachs and its billions will face off against the might of US prosecutors with the President’s credibility on the line. Will a publicized trial be showcased on TV? It could become the high drama that the government wants to keep before the public’s eyes, all the way up to the November election.
Will Paulson squirm out of any legal consequences in the same manner as O.J. Simpson when he was asked to put an ill-fitting glove on his hand in a televised hearing? Will the President be able to control himself and not chime in like he did when he said Cambridge, Massachusetts police officers “acted stupidly” when they arrested a renowned black scholar at his home?
Goldman Sachs knows it has to make the President look good or there will be unending SEC prosecution. The public wants to know whose side is the President is on, the financial titans on Wall Street or the unemployed on Main Street? It will be scripted from the beginning.
And now a final question – will Goldman Sachs be the fall guy in exchange for future favors from the government? If fines are handed out and nobody goes to jail, you will know this was likely preplanned. Will Fabrice Tourre serve as the scapegoat? He’s sure to stay outside the country for his own good. Don’t be so naïve as to not believe much of what you see happening is being staged. That’s how politics works. It’s all about political advantage, not law and order, not right and wrong.
Anytime you have the word “FRAUD” involved in an on-going investigation, It makes you wonder when corps go at it together even more…click the links below to see what I mean.
Yep, just another way for bankers to rate our credit worthiness. As we begin to witness all this garbage happening with banks these days, why even bother to save your credit? Save your cash and buy in cash. The higher the credit score the more we are worth to them. It makes no sense what so ever now. We are living our lives based on stupid silly numbers. If you want to purchase a home…go at it and be creative, ask for owner financing.
If we eliminate the banks “middle men” we will learn to live free with no strings attached. Don’t get all strung out because your score has gone way down. It’s only a number!
Keep in mind if you are in an illegal foreclosure you are only 3 months late…The non-creditors that are reporting you have nothing to do with your debt. If you care about this “FICO” score then write your bureau and demand that they delete any derogatory findings the non-creditor has filed with them!
Lets take a look at FICO:
Company milestones
1958: Fair Isaac starts building credit scoring systems.
1970: First credit card scoring system delivered.
1975: First behavior scoring system to predict credit risk related to existing customers.
1981: Introduction of Fair Isaac credit bureau try to scores.
1991: Introduction of TRIAD, a credit card management system.
1996: Stock moves from NASDAQ to NYSE.
1997: The American Bankers Association honors Bill Fair and Earl Isaac with Distinguished Service Award for their pioneering work in credit scoring. AHA… you see I knew they were involved some how! Right about the time they were planning our future.
1999, the average FICO score of the top prime issuers of 30-year mortgage pools (privately issued non-GSE mortgage-backed securities) was 721 compared to a 605 average FICO score for subprime issuers of fixed-rate pools.
Under another classification, a 580 FICO score has been used to describe the minimum credit score acceptable for “A-minus” credit. Still, the lower grade subprime borrowers are characterized by a history of more delinquencies on their credit obligations. Under one classification, “B” and “C” borrowers can have a minimum FICO score of 540 and may have four late mortgage payments in the past twelve months. See Jess Lederman, Tom Millon, Stacy Ferguson, and Cedric Lewis, “A-minus Breaks Away from Subprime Loan Pack,” in Secondary Market Executive.
2002: Merger with HNC Software, Inc., adding fraud detection to their arsenal with the $100 million Falcon product line and strengthening their analytics offerings in the insurance and telecommunications markets.
2003: Fair, Isaac and Company is renamed Fair Isaac Corporation. Here too …they were on to something.
2004: Acquisition of London Bridge Software, expanding services to credit collections and recovery software. Opens a new analytic consulting and product development center in Bangalore, India targeted primarily at Asia Pacific markets.
2005: Acquisition of RulesPower, bringing Rete III algorithm to Blaze Advisor.
2006: Celebrates 50th anniversary.
2008: Fair Isaac released Debt Manager 7
2009: Company name changed from Fair Isaac, to FICO (FICO means Fair Isaac Corporation). Website changed to fico.com
“Shitty Shitty Bank Bank” – A Financial Collapse Parody From [STANION STUDIOS] Bait and Switch TV: Investigative Satire (Episode/Show 2) GREAT BALLS OF FIRE – THE FEDERAL RESERVE & BANKING IN AMERICA www.baitandswitchtv.com A new internet TV channel about CONTROVERSY
Pay close attention…We know who should be held accountable for this mess we are in today! How convenient for Greenspan to get out when he did…CRIMINAL!
This is a collection of soundbites from Prof. Michael Greenberger from the University of Maryland School of Law who was interviewed for a PBS FRONTLINE program concerning Brooksley Born, former chairman of the Commodity Futures Trading Commission, who attempted to regulate the secretive, multitrillion-dollar derivatives market whose crash helped trigger the 2008 financial collapse.
We have waited long and patiently for our Ferdinand Pecora moment – a modern equivalent of the episode when a tough prosecutor from New York seized the imagination of the country in the early 1930s and, over a series of congressional hearings: laid bare the wrong-doings of Wall Street in simple and vivid terms that everyone could understand, and created the groundswell of public support necessary for comprehensive reregulation. On Friday, that moment finally arrived.
There is fraud at the heart of Wall Street, according to the Securities and Exchange Commission. Pecora took on National City Bank and J.P. Morgan (the younger); these were the supposedly untouchable titans of their day. The SEC is taking on Goldman Sachs; no firm is more powerful.
Pecora exposed the ways in which leading banks mistreated their customers – typically, retail investors. The SEC alleges, with credible detail, that Goldman essentially set up some trusting clients and deliberately misled them – to the tune of effectively transferring $1 billion from them to a particular unscrupulous investor.
Pecora had the drama of the congressional hearing room and used his skills as an interrogator to batter the bastions of Wall Street, day-after-day, with gruesome and convincing detail. We don’t know where and when, but the SEC action points in one direction only: Lloyd Blankfein (CEO of Goldman) in the witness box, while John Paulson (unindicted co-conspirator) waits in the on-deck circle.
Either Blankfein knew what was going on – and is therefore liable before the law – or he was clueless and therefore incompetent. Either way, the much vaunted risk management and control systems of Goldman, i.e., what is supposed to prevent this kind of thing from happening, are exposed to be what we have long here claimed: bunk (as I argued with Gerry Corrigan, former head of the NY Fed and long-time Goldman executive, before the Senate Banking Committee when we both testified on the Volcker Rules in February).
“Too big and complex to manage” is actually the best defense for Goldman’s executives and they should offer to break up the firm into smaller and more transparent pieces as a way to settle the firm’s liability with the SEC. The current management of Goldman – along with the team that ran the firm under Hank Paulson – have destroyed the value of an illustrious franchise. Goldman used to stand for something that customers felt they could trust; now it is just a sophisticated way of ripping them off.
John Paulson obviously knew what he was doing in helping to create the “designed to fail” securities – and the consequences this would have. If he cannot be convicted of conspiracy to commit fraud, then the law in this regard needs to be tightened significantly. The Financial Crisis Inquiry Commission, chaired by Phil Angelides, is probably already planning to grill John Paulson about his taxes – the point Pecora made in this regard with J.P. Morgan junior was most telling and gripped the nation; it turned out that Morgan hardly paid any tax. I would respectfully suggest that the Angelides Commission also pull in Hank Paulson and pursue a similar line of questioning with him – when it focuses on how much money Hank Paulson made, and how little tax he paid, while building and overseeing an extortion scheme of grand proportions, America will scream.
We have something today that Pecora did not have – the pattern of behavior is already established, if not yet widely comprehended. Senator Levin’s recent grilling of WaMu revealed another layer of deliberate mistreatment of consumers within the mortgage industry. The Valukas report on the failure of Lehman exposed exactly how investors are misled by balance sheet manipulation in its most modern and insidious form. And we have learned more than enough about Goldman misleading investors over Greek debt levels.
Senator Ted Kaufman was right. Just a few weeks ago, he argued strongly from the Senate floor that there is fraud at the heart of Wall Street. Even some people who are generally sympathetic to his critique of modern financial practices thought perhaps that this specific notion was pushing the frontier. But now they get it – and today Ted Kaufman is more than mainstream; he is the public figure who made everything crystal clear.
When you deliberately withhold adverse material information from customers, that is fraud. When you do this on a grand scale, the full weight of the law will come down on you and the people who supposedly supervised you. And if the weight of that law is no longer sufficient to deal with – and to prevent going forward – the latest forms of very old and reprehensible crimes, then it is again time to change the law.
By Peg Brickley Of DOW JONES DAILY BANKRUPTCY REVIEW
The Department of Justice is conducting a nationwide probe of the company whose automated systems handle half the mortgages in the U.S., looking for evidence Lender Processing Services Inc. (LPS) has “improperly directed” the actions of lawyers in bankruptcy court.
The Jacksonville, Fla., company was spun out last year from Fidelity National Information Services Inc. (FIS), a financial technology giant that is also under scrutiny for its role in court actions, according to documents filed with the U.S. Bankruptcy Court in Philadelphia.
Although the companies say they are providers of electronic information services, the U.S. trustee believes LPS and Fidelity play a “much greater” role in court actions where thousands of homes are at risk of foreclosure, according to Bankruptcy Judge Diane Weiss Sigmund.
“The thoughtless mechanical employment of computer-driven models and communications to inexpensively traverse the path to foreclosure offends the integrity of our American bankruptcy system,” Sigmund wrote in a decision released Wednesday, April 15.
A spokeswoman for Fidelity did not respond to requests seeking comment on the investigation by the Office of the U.S. Trustee, an arm of the Department of Justice whose mission includes safeguarding the integrity of the bankruptcy courts.
Michelle Kersch, a spokeswoman for LPS, said the U.S. trustee has “advised outside counsel for LPS that it is seeking to better understand LPS’ role.” In an e-mail, Kersch pointed out that the judge held the lawyers, not LPS, responsible for the problems in the case before her.
The probe of the mortgage technology operation surfaced in a Philadelphia case after Sigmund started asking questions about the source of false court filings that came from HSBC Mortgage Corp. In pursuit of homeowners Niles and Angela Taylor, HSBC filed the wrong mortgage, gave incorrect payment amounts and claimed the Taylors had missed monthly payments. This “was simply not true,” Sigmund wrote in a 58-page decision.
This is going to unleash a domino effect! Come one, Come all! Anyone buying these CDO’s from these fraudsters need to get examined!
Interested to see their stock this week??
Merrill Used Same Alleged Fraud as Goldman, Bank Says (Update1)
By William McQuillen
April 17 (Bloomberg) — Merrill Lynch & Co. engaged in the same investor fraud that the U.S. Securities and Exchange Commission accused Goldman Sachs Group Inc. of committing, according to a bank that sued the firm in New York last year.
Cooperatieve Centrale Raiffeisen-Boerenleenbank BA, known as Rabobank, claims Merrill, now a unit of Bank of America Corp., failed to tell it a key fact in advising on a synthetic collateralized debt obligation. Omitted was Merrill’s relationship with another client betting against the investment, which resulted in a loss of $45 million, Rabobank claims.
Merrill’s handling of the CDO, a security tied to the performance of subprime residential mortgage-backed securities, mirrors Goldman Sachs conduct that the SEC details in the civil complaint the agency filed yesterday. It claimed Goldman omitted the same key fact about a financial product tied to subprime mortgages as the U.S. housing market was starting to falter.
“This is the tip of the iceberg in regard to Goldman Sachs and certain other banks who were stacking the deck against CDO investors,” said Jon Pickhardt, an attorney with Quinn Emanuel Urquhart Oliver & Hedges, who is representing Netherlands-based Rabobank.
“The two matters are unrelated and the claims today are not only unfounded but weren’t included in the Rabobank lawsuit filed nearly a year ago,” Bill Halldin, a Merrill spokesman, said yesterday of the Dutch bank’s claims.
Kenneth Lench, head of the SEC’s Structured and New Products unit, said yesterday that the agency “continues to investigate the practices of investment banks and others involved in the securitization of complex financial products tied to the U.S. housing market as it was beginning to show signs of distress.”
Failed to Disclose
In its complaint, the SEC said New York-based Goldman Sachs, which had a record $13.4 billion profit last year, failed to disclose to investors that hedge fund Paulson & Co. was betting against the CDO, known as Abacus, and influenced the selection of securities for the portfolio. Paulson, which oversees $32 billion and didn’t market the CDO, wasn’t accused of wrongdoing by the SEC.
Goldman Sachs, the most profitable securities firm in Wall Street history, created and sold CDOs tied to subprime mortgages in early 2007, as the U.S. housing market faltered, without disclosing that Paulson helped pick the underlying securities and bet against them, the SEC said in a statement yesterday.
The SEC allegations are “unfounded in law and fact, and we will vigorously contest them,” Goldman said in a statement.
Merrill Lynch’s arrangement involved Magnetar, a hedge fund that bet against a CDO known as Norma, Rabobank claimed.
Effort to Replicate
“When one major firm becomes aware of the creative instrument of others, there is historically an effort to replicate them,” said Jacob Frenkel, a former SEC lawyer now in private practice in Potomac, Maryland.
SEC spokesman John Heine declined to comment on whether it is investigating Merrill’s actions.
Norma’s largest investor was investment bank Cohen & Co, with more than $100 million in notes, according to Rabobank’s complaint.
Merrill loaded the Norma CDO with bad assets, Rabobank claims. Rabobank seeks $45 million in damages, according to a complaint filed in state court in June 2009. Rabobank initially provided a secured loan of almost $60 million to Merrill, according to its complaint.
Risks Disclosed
Merrill countered in court papers that Rabobank was aware of the risks, which were disclosed in the transaction documents. The bank should have been responsible for conducting its own due diligence, and shouldn’t have relied on Merrill, it said in a court filing last year seeking to dismiss the case.
Steve Lipin, an outside spokesman for Magnetar, didn’t immediately comment.
The case is Cooperatieve Centrale Raiffeisen- Boerenleenbank, B.A. v. Merrill Lynch & Co, 09-601832, New York State Supreme Court (New York County).
SmarTrend identified a Downtrend for Lender Processing Services (NYSE: LPS) on March 31, 2010 at $38.26. In approximately 2 weeks, Lender Processing Services has returned 3.3% as of today’s recent price of $36.99.
Lender Processing Services is currently below its 50-day moving average of $38.94 and below its 200-day moving average of $37.98. Look for these moving averages to decline to confirm the company’s downward momentum.
SmarTrend will continue to scan these moving averages and a number of other proprietary indicators for any changes in momentum for shares of Lender Processing Services.
The first thing you need to know about Goldman Sachs is that it’s everywhere. The world’s most powerful investment bank is a great vampiresquidwrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.
TYX91101 Taibbi’s excellent articles alone are worth the price of the magazine. There have been several. He’s doing a commendable? job of putting Wall Street monkey business into the public consciousness. You never get that kind of reporting on CNBC. Great work Matt! 6 hours ago
overseachininadoll Those who greatly benefited from the? crash must hand back the money. (Paulson company) 14 hours ago
Relugus Alot more than the sycophantic financial journalists who kiss Wall Street’s ass.? Wall Street has been screwing people, stealing taxpayers money, stealing wealth from the people, for decades. People are slowly waking up to what Wall Street is, a bunch of criminals and gangsters. 18 hours ago
In a time when you can stroll over to the computer and rattle off an e-mail to your elected official because you think your taxes are too high or leave an anonymous comment on a blog or article voicing your disapproval with a particular reporter, it would seem that the days of face-to-face action and rallies are unfortunately a thing of the past.Not for a group of activists in Florida heading to the Capitol in Tallahassee on Wednesday, April 21.
Michael Redman (4closureFraud), and Lisa Epstein (Foreclosure Hamlet), in an effort to convince Florida legislators to listen to their constituents, are organizing a transport to the capital. An old fashion road trip of attorneys, advocates, and homeowners. Transportation is being organized and buses will be available from key areas throughout Florida and along major roadways. Redman and Epstein had initially dipped into their own pockets to charter buses for the event.
As of April 16th, according to Redman’s blog, in a Friday post,
“Team Ice in West Palm has sponsored their bus and now one of Pinellas County’s toughest foreclosure fighters has generously agreed to sponsor a bus to make sure any attorney and homeowner who wants to go to Tallahassee and make his or her voice heard has the opportunity to get up there and meet face to face.”
“One of the most inspiring things about all of this is seeing how the defense attorneys are all throwing their time, talent and treasure into this fight. We all share our ideas, insight and experience because doing so serves the interests of not just our clients but those folks out there who cannot afford an attorney and it especially serves the Constitution we took an oath to protect and the judiciary we respect,”
The most important piece of legislation the group was trying to stop was a push by bankers to change the way Florida handles foreclosures. Florida currently, and always has had Judicial foreclosures. The bank’s proposed legislation would have allowed banks to foreclose on Florida homes without going to court. According to Matt Weidner, a Florida attorney, the bill for now appears to have been stopped in the House, but the Senate will meet next week and according to an old Florida saying, “No one’s safe while the legislature is in session.”
A non-judicial foreclosure would mean that, “you the homeowner won’t automatically get your day in court if your lender tries to take your house away. The way it works right now is the lender is required by law to file a civil lawsuit against you in order to foreclose. You then have to answer it. If you don’t answer it or don’t show up to court, the judge issues a summary judgment against you. In a non-judicial foreclosure everything is done administratively and your right to due process is compromised and you have to beg for your day in court,” as explained by Steve Dibert of MFI-Miami.
Although the bill appears to have died, and the bankers appear to have conceded, this motivated band of advocates doesn’t want to leave anything to chance.
An e-mail from Weidner reads:
As Mark Twain said, ‘News of My death was greatly exaggerated.’ Although the legislation appears to have died, the passion and concern that its introduction incited has only increased with word of its demise. Tapping into broad based anxiety and concern felt by homeowners all across Florida, the group has turned its focus from defeating this legislation to demanding legislation that will increase protections for Florida homeowners. Talk about turning the tables. They are meeting with Senator Mark Aronberg and Rep. Darren Soto who introduced a “Homeowner’s Bill of Rights“. They’re asking that this legislation be resurrected… at the very least they want to make sure their legislators are fully aware of their concerns and the problems they’re facing.
According to Weidner’s press release,
“The response from legislators to this movement has been awe-inspiring. Our leaders in Washington may have trouble hearing the voices of their people, but the leaders who represent us in Tallahassee hear the voice of the people loud and clear! Already leaders from both houses have graciously agreed to meet with their voters, we’re confident many more will agree to meet with us when we arrive.”
Michael Moore spoke of the apathy and lack of action he witnessed despite his tireless work drawing attention to key issues affecting millions of Americans.
“Two years ago, I tried to get the health-care debate going, and it did eventually, and now where are we? We may not even have it. What am I supposed to do at a certain point?, ” Moore said in an 2009 Toronto press conference.
It’s refreshing and inspiring to think that may be changing.
Denise Richardson (givemebackmycredit.com) posted the following from Lisa Epstein on her blog:
This is not just for homeowners!We are ALL reduced by the actions behind the mortgage frauds and scams. Tenants! Anyone who relies on any public service funded by our now shrunken tax revenues! Anyone owning any property at all, fully paid off or not. Any business owner! Unemployed family members! Credit card/bank account fees victims! Those with drained 401Ks and college savings accounts!
We will be heard as was the Florida Bankers Association on their own “Capitol Day” on March 10, 2010. Florida Bankers, guess what? You wanted a “Taste of Florida”? You are gonna get one! We are having our own “Capitol Day”! But our collective voices will be a harmony; louder, clearer, unwavering, and with a foundation firmly planted in the historical roots of our country as a nation for WE, THE PEOPLE!
Bankers and other stealth foreclosing entities, listen up! We are NOT boobs, chumps, doormats, dupes, easy marks, fools, goats, gulls, patsies, pigeons, pushovers, saps, scapegoats, schmucks, sitting ducks, stooges, suckers, victims, or weaklings, And we most certainly are not “deadbeats”!
To find out more about the rally and let them know you’ll be along for the ride, see Redman’s site at 4closurefraud.org or Weidner’s blog for more information.
Action Date: April 16, 2010 Location: New York, NY
On April 16, 2010, the SEC filed securities fraud charges against Goldman, Sachs & Co. (“GS&Co”) and a GS&Co employee, Fabrice Tourre (“Tourre”), for making material misstatements and omissions in connection with a collateralized debt obligation (“CDO”) GS&Co made and marketed to investors. ABACUS 2007-AC1, a mortgage-backed trust, was tied to the performance of subprime residential mortgage-backed securities. Abacus was made and marketed in early 2007 when the United States housing market was beginning to show signs of distress. Mortgage-backed trusts like ABACUS 2007-AC1 contributed to the financial crisis. According to the Commission’s complaint, the marketing materials for ABACUS 2007-AC1 all represented that the reference portfolio of RMBS underlying the CDO was selected by ACA Management LLC (“ACA”), a third party with expertise in analyzing credit risk in RMBS. Undisclosed in the marketing materials and unbeknownst to investors, a large hedge fund, Paulson & Co. Inc. (“Paulson”), with economic interests directly adverse to investors in the ABACUS 2007-AC1 CDO played a significant role in the portfolio selection process. After participating in the selection of the reference portfolio, Paulson effectively shorted the RMBS portfolio it helped select by entering into credit default swaps (“CDS”) with GS&Co to buy protection on specific layers of the ABACUS 2007-AC1 capital structure. Given its financial short interest, Paulson had an economic incentive to choose RMBS that it expected to experience credit events in the near future. GS&Co did not disclose Paulson’s adverse economic interest or its role in the portfolio selection process in the term sheet, flip book, offering memorandum or other marketing materials. The Commission alleges that Tourre was principally responsible for ABACUS 2007-AC1. According to the Commission’s complaint, Tourre devised the transaction, prepared the marketing materials and communicated directly with investors. Tourre is alleged to have known of Paulson’s undisclosed short interest and its role in the collateral selection process. He is also alleged to have misled ACA into believing that Paulson invested approximately $200 million in the equity of ABACUS 2007-AC1 (a long position) and, accordingly, that Paulson’s interests in the collateral section process were aligned with ACA’s when in reality Paulson’s interests were sharply conflicting. The deal closed on April 26, 2007. Paulson paid GS&Co approximately $15 million for structuring and marketing ABACUS 2007-AC1. By October 24, 2007, 83% of the RMBS in the ABACUS 2007-AC1 portfolio had been downgraded and 17% was on negative watch. By January 29, 2008, 99% of the portfolio had allegedly been downgraded. Investors in the liabilities of ABACUS 2007-AC1 are alleged to have lost over $1 billion. Paulson’s opposite CDS positions yielded a profit of approximately $1 billion. The Commission’s complaint, which was filed in the United States District Court for the Southern District of New York, charges GS&Co and Tourre with violations of Section 17(a) of the Securities Act of 1933, 15 U.S.C. §77q(a), Section 10(b) of the Securities Exchange Act of 1934, 15 U.S.C. §78j(b) and Exchange Act Rule 10b-5, 17 C.F.R. §240.10b-5. The Commission seeks injunctive relief, disgorgement of profits, prejudgment interest and civil penalties from both defendants.
All over the US there is mass title defects that have been created to our homes…we are being evicted and titles to our stolen homes are being fabricated by means of Forgery/FRAUD! If these homes have been stolen from us…we have the right to claim them back! Let the unsuspecting homeowner who buys your home that it was fraudulently taken from you! What happens when your car is stolen and reclaimed? It goes back to it’s owner!
Stop by, say hello to the new owner of your stolen home and welcome them to the bogus neighborhood! Oh make sure to show some hospitality and bring them a gift…Umm your Foreclosure Mill Docs!
A Florida state-court judge, in a rare ruling, said a major national bank perpetrated a “fraud” in a foreclosure lawsuit, raising questions about how banks are attempting to claim homes from borrowers in default.
The ruling, made last month in Pasco County, Fla., comes amid increased scrutiny of foreclosures by the prosecutors and judges in regions hurt by the recession. Judges have said in hearings they are increasingly concerned that banks are attempting to seize properties they don’t own.
The Florida case began in December 2007 when U.S. Bank N.A. sued a homeowner, Ernest E. Harpster, after he defaulted on a $190,000 loan he received in January of that year.
The Law Offices of David J. Stern, which represented the bank, prepared a document called an “assignment of mortgage” showing that the bank received ownership of the mortgage in December 2007. The document was dated December 2007.
But after investigating the matter, Circuit Court Judge Lynn Tepper ruled that the document couldn’t have been prepared until 2008. Thus, she ruled, the bank couldn’t prove it owned the mortgage at the time the suit was filed.
The document filed by the plaintiff, Judge Tepper wrote last month, “did not exist at the time of the filing of this action…was subsequently created and…fraudulently backdated, in a purposeful, intentional effort to mislead.” She dismissed the case.
Forrest McSurdy, a lawyer at the David Stern firm that handled the U.S. Bank case, said the mistake was due to “carelessness.” The mortgage document was initially prepared and signed in 2007 but wasn’t notarized until months later, he said. After discovering similar problems in other foreclosure cases, he said, the firm voluntarily withdrew the suits and later re-filed them using appropriate documents.
“Judges get in a whirl about technicalities because the courts are overwhelmed,” he said. “The merits of the cases are the same: people aren’t paying their mortgages.”
Steve Dale, a spokesman for U.S. Bank, said the company played a passive role in the matter because it represents investors who own a mortgage-securities trust that includes the Harpster loan. He said a division of Wells Fargo & Co., which collected payments from Mr. Harpster, initiated the foreclosure on behalf of the investors.
Wells Fargo said in a statement it “does not condone, accept, nor instruct counsel to take actions such as those taken in this case.” The company said it was “troubled” by the “conclusions the Court found as to the actions of this foreclosure attorney. We will review these circumstances closely and take appropriate action as necessary.”
Since the housing crisis began several years ago, judges across the U.S. have found that documents submitted by banks to support foreclosure claims were wrong. Mistakes by banks and their representatives have also led to an ongoing federal criminal probe in Florida.
Some of the problems stem from the difficulty banks face in proving they own the loans, thanks to the complexity of the mortgage market.
The Florida ruling against U.S. Bank was also a critique of law firms that handle foreclosure cases on behalf of banks, dubbed “foreclosure mills.”
Lawyers operating foreclosure mills often are paid based on the volume of cases they complete. Some receive $1,000 per case, court records show. Firms compete for business in part based on how quickly they can foreclose. The David Stern firm had about 900 employees as of last year, court records show.
“The pure volume of foreclosures has a tendency perhaps to encourage sloppiness, boilerplate paperwork or a lack of thoroughness” by attorneys for banks, said Judge Tepper of Florida, in an interview. The deluge of foreclosures makes the process “fraught with potential for fraud,” she said.
At an unrelated hearing in a separate matter last week, Anthony Rondolino, a state-court judge in St. Petersburg, Fla., said that an affidavit submitted by the David Stern law firm on behalf of GMAC Mortgage LLC in a foreclosure case wasn’t necessarily sufficient to establish that GMAC was the owner of the mortgage.
“I don’t have any confidence that any of the documents the Court’s receiving on these mass foreclosures are valid,” the judge said at the hearing.
A spokesman for GMAC declined to comment and a lawyer at the David Stern firm declined to comment.
The SEC’s complaint charges Goldman Sachs and Tourre with violations of Section 17(a) of the Securities Act of 1933, Section 10(b) of the Securities Exchange Act of 1934, and Exchange Act Rule 10b-5. The Commission seeks injunctive relief, disgorgement of profits, prejudgment interest, and financial penalties.
In courtrooms across the country, judges are foreclosing on homes based on improperly prepared documentation, some of which may even be fraudulent. At the heart of the problem are entities like Mortgage Electronic Registration System (MERS), which itself is owned by many of the largest financial institutions in the U.S. If MERS and other similar firms acting as foreclosing entity were required to show legal proof of mortgage assignment, the documentation offered could reveal a lack of capitalization that would make the bank bailout look like lunch money.
Of interest is 
For sure, the Administration in Washington DC will be portrayed in coming months as the hero, rescuing the public from the blood-suckers on Wall Street. Be it government to save us all from problems it created and then pin a badge of honor on itself. The current and former administrations in Washington DC are, and have been, so tightly controlled and managed by Wall Street, even with its ex-CEOs strategically implanted within the Executive Branch, as to call all alleged reforms and sanctions into question. These are just for show.
Merrill Used Same Alleged Fraud as Goldman, Bank Says (Update1)
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