You might also be interested in: Bankruptcy Will Not Kill A Zombie Deed (Or Will It?)

CNN-

Borrowers are discovering that their foreclosed homes are coming back to haunt them — long after they have moved out.

In these so-called zombie foreclosures, borrowers move out of their homes after their bank schedules a foreclosure auction only to find out months or years later that the auction never took place or the bank never transferred the deed to the house. That means the borrower still technically owns the home, leaving them on the hook for property taxes, fees and for homeowners’ association dues.

Since the housing bubble first burst seven years ago, almost two million properties have started the foreclosure process but never completed it, according to RealtyTrac. In half of those cases, the homeowner is fighting to stay in the home. But there are close to one million properties that are in some sort of foreclosure limbo. While no one knows the exact number, it’s estimated that tens of thousands of those properties could be zombie foreclosures.

[CNN]

Reuters-

* CEO’s pay increases to $12.1 million from $7 million on bigger stock grants

* 2013 salary will increase to $1.5 million from $950,000

* Some of stock grants are performance-based

By Rick Rothacker

Feb 19 (Reuters) – Bank of America Corp Chief Executive Brian Moynihan’s pay increased 73 percent in 2012 from the previous year to $12.1 million, as the bank gave him a bigger package of stock awards.

The second-largest U.S. bank gave Moynihan a raise when other CEOs on Wall Street received a pay cut, after Bank of America’s stock soared in 2012 and it made progress in resolving lawsuits from the financial crisis.

[REUTERS]

Now you can understand when I say the market is manipulated. Whenever you hear the home market has finally turned around, think MANIPULATION. These are hedge funds, billionaire corps etc buying these in bundles.

So what happens to the massive toxic titles to these homes full of fraud? Like the toxic MBS, you think they have learned a lesson. 

A Bubble in the making.

Palm Beach Post-

Hedge funds and investment firms are buying up Florida foreclosures, beating out homebuyers and local flippers, while steering the state into what some fear is another real estate bubble.

The companies, including New York-based Blackstone Group and Lake Success Rentals, a partner of Toronto-based Tricon Capital Group, purchased an estimated 5,300 Florida homes last year that were in some stage of foreclosure, according to a report from RealtyTrac.

In Palm Beach County, RealtyTrac measured 425 purchases by firms buying multiple properties out of foreclosure and usually with the intent to rent them out until increasing property values can offer a substantial return on investment.

[PALM BEACH POST]

KAPTUR/WARREN 2016!

This is the Bill everyone should be pushing very hard to get enacted. Enough with taxpayers getting plummeted for the fraudulent acts behind this machine and Wall Street! Enough with the fraudulent bailouts the government continues to provide these cartels. Enough is Enough!

Marcy Kaptur has never once gave up on this bill and neither should you. Make this Bill go viral…make it happen.

.

Asset Quality Misrepresentation by Financial Intermediaries: Evidence from RMBS Market

.

Tomasz Piskorski

Columbia Business School – Finance and Economics

Amit Seru

University of Chicago – Booth School of Business and NBER

James Witkin

Columbia University – Columbia Business School

February 12, 2013

Abstract:     
We contend that buyers received false information about the true quality of assets in contractual disclosures by intermediaries during the sale of mortgages in the $2 trillion non-agency market. We construct two measures of misrepresentation of asset quality — misreported occupancy status of borrower and misreported second liens — by comparing the characteristics of mortgages disclosed to the investors at the time of sale with actual characteristics of these loans at that time that are available in a dataset matched by a credit bureau. About one out of every ten loans has one of these misrepresentations. These misrepresentations are not likely to be an artifact of matching error between datasets that contain actual characteristics and those that are reported to investors. At least part of this misrepresentation likely occurs within the boundaries of the financial industry (i.e., not by borrowers). The propensity of intermediaries to sell misrepresented loans increased as the housing market boomed, peaking in 2006. These misrepresentations are costly for investors, as ex post delinquencies of such loans are more than 60% higher when compared with otherwise similar loans. Lenders seem to be partly aware of this risk, charging a higher interest rate on misrepresented loans relative to otherwise similar loans, but the interest rate markup on misrepresented loans does not fully reflect their higher default risk. Using measures of pricing used in the literature, we find no evidence that these misrepresentations were priced in the securities at their issuance. A significant degree of misrepresentation exists across all reputable intermediaries involved in sale of mortgages. The propensity to misrepresent seems to be largely unrelated to measures of incentives for top management, to quality of risk management inside these firms or to regulatory environment in a region. Misrepresentations on just two relatively easy-to-quantify dimensions of asset quality could result in forced repurchases of mortgages by intermediaries up to $160 billion.

Project On Government Oversight

Dangerous Liaisons:
Revolving Door at SEC Creates
Risk of Regulatory Capture

February 11, 2013

OVERVIEW

A revolving door blurs the lines between one of the nation’s most important regulatory agencies
and the interests it regulates.

Former employees of the Securities and Exchange Commission (SEC) routinely help
corporations try to influence SEC rulemaking, counter the agency’s investigations of suspected
wrongdoing, soften the blow of SEC enforcement actions, block shareholder proposals, and win
exemptions from federal law.

The revolving door was on display in 2012 when the investment industry opposed one of the top
priorities of the SEC chairman, a plan to tighten regulation of money market funds. Former SEC
employees lobbied to block the plan, and an SEC Commissioner who previously worked for an
investment firm played a pivotal role in derailing it.

The movement of people to and from the financial industry is a key feature of the SEC, and it has
the potential to influence the agency’s culture and values. It matters because the SEC has the
power to affect investors, financial markets, and the economy.

Yet, the SEC has exempted certain senior employees from a “cooling off period” that would
have restricted their ability to leave the SEC and then represent clients before the agency. In
addition, the SEC has shielded some former employees from public scrutiny by blacking out
their names in documents they must file when they go through the revolving door.

The SEC is a microcosm of the federal government, where widespread revolving expands the
opportunities for private interests to sway public policy.

One academic study suggested that concerns about the SEC’s revolving door are misguided. But
the academics looked at only a sliver of the SEC’s work. They did not examine, for instance,
how the revolving door affects the SEC’s regulation of Wall Street, its granting of relief to
specific companies, its handling of cases related to the financial crisis, or its decisions to drop
investigations without bringing charges. The study sought to quantify any influence the
revolving door might have on SEC enforcement actions, but the subtleties involved do not lend
themselves to such simple measurement.

This report, the Project On Government Oversight’s (POGO) second on the SEC, is based in part
on interviews with current and former SEC officials and thousands of federal records obtained
through the Freedom of Information Act.

POGO found that, from 2001 through 2010, more than 400 SEC alumni filed almost 2,000
disclosure forms saying they planned to represent an employer or client before the agency. Those
disclosures are just the tip of the iceberg, because former SEC employees are required to file
them only during the first two years after they leave the agency.

POGO’s report examines many manifestations of the revolving door, analyzes how the revolving
door has influenced the SEC, and explores how to mitigate the most harmful effects.

[ipaper docId=126323068 access_key=key-c8skgko42owcfhz3njk height=600 width=600 /]

Has always been a BIG fraudulent business on Wall Street, how else do ya think they made it this far? Take the fraud away and let see them become successful. They’re only doing this because their other ponzi methods have been exposed. Now move on to the next ponzi…of course.

AND Who needs insider trading? Like US Rep. Marcy Kaptur said: “LOOK AT THOSE OVER AT THE JUSTICE DEPARTMENT AND WHERE THEY WORKED BEFORE THEY GOT THERE”, and go with their former/current clients.

Find the most fraudulent players and stick with them because there will always be an APP for that..

Reuters-

Delinquent and defaulting mortgage loans to struggling US borrowers have become big business on Wall Street, as investors scoop up bonds backed by non-performing loans (NPLs).

With millions of borrowers still under water or facing foreclosure, real estate investment trusts (REITs) and others are snapping up NPLs at a discount, hoping to earn returns from their eventual resolution or liquidation.

And the more value that can be extracted from each loan, the better the returns – which means it is in the interest of investors to work with troubled borrowers to find solutions.

[REUTERS]

U.S. Department of Justice
Criminal Division

Washington, D.C. 20530
February 14, 2013

Paul J. McNulty, Esq.
Joan Meyer, Esq.
Baker & McKenzie LLP
815 Connecticut Ave,
NW Washington, DC 20006-4078

Re: Lender Processing Services, Inc.

Dear Mr. McNulty and Ms. Meyer:

On the understandings specified below, the United States Department of Justice, Criminal Division, Fraud Section and the United States Attorney’s Office for the Middle District of Florida (collectively, the “Government”) will not criminally prosecute Lender Processing Services, Inc. and its subsidiaries and affiliates (collectively, “LPS”), for any crimes (except for criminal tax violations, as to which the Government cannot and does not make any agreement) related to the preparation and recordation of mortgage-related documents as described in the attached Appendix A, which is incorporated in this Non-Prosecution Agreement (“Agreement”).

It is understood that LPS admits, accepts, and acknowledges responsibility for the conduct set forth in Appendix A, and agrees not to make any public statement contradicting Appendix A.

The Fraud Section enters into this Agreement based, in part, on its consideration of the following factors:

(a) LPS has made a timely, voluntary, and complete disclosure ofthe facts described in Appendix A.

(b) LPS conducted a thorough internal investigation ofthe misconduct described in Appendix A, reported its findings to the Government, cooperated with the Government’s investigation of this matter, and sought to effectively remediate any problems it discovered.

1. Although LPS’s self-disclosure and cooperation commenced after a whistleblower complaint brought the misconduct to the government’s attention, since the misconduct described in Appendix A was first reported, LPS has taken substantial remedial actions, including:

a. Within approximately six months of discovering the misconduct, LPS wound down all operations of its wholly-owned subsidiary DocX, LLC (“DocX”) in Alpharetta, Georgia, where the primary misconduct described in Appendix A took place.

b. LPS took action to remediate certain of the filings made by DocX from March to October 2009, including re-executing with proper signatures and notarizations, approximately 30,000 mortgage assignments.

c. Within weeks of the disclosure, LPS terminated DocX’s president, Lorraine Brown. Later, after conducting its internal investigation, LPS terminated Ms. Brown’s immediate supervisor at LPS for, among other reasons, failure to supervise Ms. Brown and the DocX operation.

2. The Government received substantial information from LPS, as well as from federal and state regulatory agencies, demonstrating LPS has recently made important and positive changes in its compliance, training, and overall approach to ensuring its adherence to the law.

a. On April 13, 2011, LPS entered into a consent order (the “2011 ” Consent Order”) with the Board of Governors ofthe Federal Reserve System, the Office ofthe Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Office of Thrift Supervision (collectively, the “Banking Agencies”). The 2011 Consent Order has a number of conditions with which LPS is required to comply, including:

(i) delineating a methodology for reviewing document execution practices and remediating identified issues;

(ii) establishing an acceptable compliance program and timeline for implementation;

(iii) acceptably enhancing its risk management program;

(iv) acceptably enhancing its internal audit program;

(v) retaining an independent consultant to review and report on LPS’s document execution practices, and assess related operational, compliance, legal, and reputational risks; and (vi) to the extent that the independent consultant identifies any financial harm stemming from the document execution practices to mortgage servicers or borrowers, establish a plan for reimbursing any such financial injury.

To date, LPS has complied with the conditions of the 2011 Consent Order. That work is ongoing and is subject to review and approval by the Banking Agencies.

b. LPS has agreed in a multi-state settlement with a number of state attorneys general (the “Multi-State Resolution”) to undertake additional steps, including assisting homeowners with remediating specific documents as necessary and appropriate.

c. Including this Agreement, LPS has paid to date over $160 million to state and federal authorities related to the DocX conduct.
This recent record is commendable, and partially mitigates the adverse implications of the prior history of misconduct at the DocX subsidiary.

3. The primary misconduct set forth in Appendix A took place at DocX, a subsidiary acquired by an LPS predecessor company in 2005, which constituted less than 1% of LPS’s overall corporate revenue.

4. The Government’s investigation has revealed, as set forth in Appendix A, that Lorraine Brown and others at DocX took various steps to actively conceal the misconduct taking place at DocX from detection, including from LPS senior management and auditors.

This Agreement does not provide any protection against prosecution for any crimes except as set forth above, and applies only to LPS and not to any other entities or to any individuals, including but not limited to employees or officers of LPS. The protections provided to LPS shall not apply to any acquirer or successor entities unless and until such acquirer or successor formally adopts and executes this Agreement.

This Agreement shall have a term of two years from the date of this Agreement, except as specifically provided below. It is understood that for the two-year term of this Agreement, LPS shall: (a) commit no crime whatsoever; (b) truthfully and completely disclose non-privileged information with respect to the activities of LPS, its officers and employees, and others concerning all matters about which the Government inquires of it, which information can be used for any purpose, except as otherwise limited in this Agreement; (c) bring to the Government’s attention all potentially criminal conduct by LPS or any of its employees that relates to violations of U.S. laws (i) concerning fraud or (ii) concerning mortgage or foreclosure document execution services; and (d) bring to the Government’s attention all criminal or regulatory investigations, administrative proceedings or civil actions brought by any governmental authority in the United States against LPS, its subsidiaries, or its employees that alleges fraud or violations of the laws governing mortgage or foreclosure document execution services.

Until the date upon which all investigations and prosecutions arising out of the conduct described in this Agreement are concluded, whether or not they are finished within the two-year term specified in the preceding paragraph, LPS shall, in connection with any investigation or prosecution arising out ofthe conduct described in this Agreement: (a) cooperate fully with the Government, the Federal Bureau of Investigation, and any other law enforcement or government agency designated by the Government; (b) assist the Government in any investigation or prosecution by providing logistical and technical support for any meeting, interview, grand jury proceeding, or any trial or other court proceeding; (c) use its best efforts promptly to secure the attendance and truthful statements or testimony of any officer, agent or employee at any meeting or interview or before the grand jury or at any trial or other court proceeding; and (d) provide the Government, upon request, all non-privileged information, documents, records, or other tangible evidence about which the Government or any designated law enforcement or government agency inquires.

It is understood that, if the Government determines in its sole discretion that LPS has committed any crime subsequent to the date of this Agreement, or that LPS has given false, incomplete, or misleading testimony or information at any time, or that LPS has otherwise violated any provision of this Agreement, LPS shall thereafter be subject to prosecution for any federal violation of which the Government has knowledge, including perjury and obstruction of justice. Any such prosecution that is not time-barred by the applicable statute of limitations on the date ofthe signing of this Agreement may be commenced against LPS, notwithstanding the expiration of the statute of limitations between the signing of this Agreement and the expiration of the term of the Agreement plus one year. Thus, by signing this Agreement, LPS agrees that the statute of limitations with respect to any prosecution based on the facts set forth in Appendix A that is not time-barred on the date that this Agreement is signed shall be tolled for the term of this Agreement plus one year.

It is understood that, if the Government determines in its sole discretion that LPS has committed any crime after signing this Agreement, or that LPS has given false, incomplete, or misleading testimony or information at any time, or that LPS has otherwise violated any provision of this Agreement:

(a) all statements made by LPS or any of its employees to the Government or other designated law enforcement agents, including Appendix A, and any testimony given by LPS or any of its employees before a grand jury or other tribunal, whether prior or subsequent to the signing of this Agreement, and any leads derived from such statements or testimony, shall be admissible in evidence in any criminal proceeding brought against LPS; and (b) LPS shall assert no claim under the United States Constitution, any statute, Rule 410 of the Federal Rules of Evidence, or any other federal rule that such statements or any leads derived therefrom are inadmissible or should be suppressed.

By signing this Agreement, LPS waives all rights in the foregoing respects.

The decision whether any public statement, made prospectively by LPS, contradicts Appendix A and whether it shall be imputed to LPS for the purpose of determining whether LPS has breached this Agreement shall be in the sole discretion ofthe Government. If the Government determines that a public statement contradicts in whole or in part a statement contained in Appendix A, the Government shall so notify LPS, and LPS may avoid a breach of this Agreement by publicly repudiating such statement(s) within five business days after notification. This paragraph is not intended to apply to any statement made by any former LPS officers, directors, or employees. Further, nothing in this paragraph precludes LPS from taking good-faith positions in litigation involving a private party that are not inconsistent with Appendix A. In the event that the Government determines that LPS has breached this Agreement in any other way, the Government agrees to provide LPS with written notice of such breach prior to instituting any prosecution resulting from such breach. LPS shall, within 30 days of receipt of such notice, have the opportunity to respond to the Government in writing to explain the nature and circumstances of such breach, as well as the actions LPS has taken to address and remediate the situation, which explanation the Government shall consider in determining whether to institute a prosecution.

It is understood that LPS agrees to pay a total monetary penalty of $35,000,000. LPS must pay $20 million of this sum to the United States Marshals Service, and $15 million to the United States Treasury, both within ten days of execution of this Agreement. The United States has provided LPS separately with wiring instructions to accomplish these payments.

LPS takes no position as to the disposition ofthe funds after payment and waives any statutory or procedural notice requirements with respect to the United States’ disposition ofthe funds. As a result of LPS’s conduct, including the conduct set forth in Appendix A, LPS agrees that the United States is entitled to forfeit the proceeds of the conduct pursuant to Title 18, United States Code, Section 981(a)(1)(C). Without admitting that LPS and/or its predecessors in interest received $20 million in proceeds, LPS agrees that by executing this Non-Prosecution Agreement it is releasing all claims it may have to the funds, including the right to challenge the civil forfeiture ofthe $20 million payment, as proceeds of such conduct. LPS further agrees to sign any additional documents necessary to complete civil forfeiture of the funds, including but not limited to a consent to forfeiture.

The $35 million total amount paid is final and shall not be refunded should the Government later determine that LPS has breached this Agreement and commence a prosecution against LPS. The Government agrees that in the event of a subsequent breach and prosecution, it will recommend to the Court that $20 million be offset against whatever forfeiture the Court shall impose as part of its judgment and $15 million be offset against whatever fine the Court shall impose as part of its judgment. LPS understands that such a recommendation will not be binding on the Court. LPS agrees that it shall not seek any tax deduction in connection with these payments, and shall not seek to have either ofthe payments applied as a set-off as to any other regulatory fine or other debt owed to the United States as of the date that this Agreement is executed.

It is further understood that, as noted above, LPS has strengthened its compliance and internal controls standards and procedures, and that it will further strengthen them as required by the Banking Agencies and any other regulatory or enforcement agencies that have addressed the misconduct set forth in Appendix A. In addition, in light of active investigations by various regulators ofthe conduct described in Appendix A, and the role that regulators such as those listed above will continue to play in reviewing LPS’s compliance standards, the Government has determined that adequate compliance measures have been and will be established. It is further understood that LPS will report to the Government, upon request, regarding its remediation and implementation of any compliance program and internal controls, policies, and procedures that relate to its mortgage or foreclosure document execution services. Moreover, LPS agrees that it has no objection to any regulatory agencies providing to the Government any information or reports generated by such agencies or LPS regarding this matter. Such information and reports will likely include proprietary, financial, confidential, and competitive business infonnation. Moreover, public disclosure of the information and reports could discourage cooperation, impede pending or potential governmental investigations, and thus undermine the objectives of the reporting requirement. For these reasons, among others, the information and reports and the contents thereof are intended to remain and shall remain non-public, except as otherwise agreed to by the parties in writing, or except to the extent that the Government determines in its sole discretion that disclosure would be in furtherance ofthe Government’s discharge of its duties and responsibilities or is otherwise required by law.

It is further understood that this Agreement does not bind any federal, state, local, or foreign prosecuting authority other than the Government. The Government will, however, bring the cooperation of LPS to the attention of other prosecuting and investigative authorities, if requested by LPS.

It is further understood that LPS and the Government may disclose this Agreement to the public.

With respect to. this matter, from the date of execution of tliis Agreement forward, this Agreement supersedes all prior, if any, understandings, promises and/or conditions between the Government and LPS. No additional promises, agreements, and conditions have been entered
into other than those set forth in this Agreement, and none will be entered into unless in writing and signed by all parties.

Sincerely,

DENIS J. McINERNEY
Chief, Fraud Section
Criminal Division
United States Department of justice

Glenn S. Leon, Assistant Chief
Ryan Rohlfsen, Trial Attorney

ROBERT E. O’NEILL United States Attorney

MarkB. Devereaux / Assistant United States Attorney

Eventually there will be a future president that will not allow main street to get trampled on. But until then sit back and watch as the US continues to be destroyed by corruption and lack of leadership.

HuffPO-

Take a look at these two sentences:

“(I)f losses from the 2007– 2009 crisis were to reach similar levels (as they did in previous recessions) … losses could exceed $13 trillion.” Government Accountability Office

“You would think that any regulation that could affect a major part of the economy and cost industry and/or consumers millions of dollars to comply with would be based on rigorous and consistent economic analysis.” David C. Johns, Heritage Foundation

In the face of trillion-dollar losses, Wall Street’s conservative spokespeople sound like Dr. Evil presenting his demands to world leaders: I will destroy the planet unless you give me … one million dollars.

[HUFFINGTON POST]

by Parker & DuFresne –

Earlier this month, the House Civil Justice Subcommittee approved a bill designed to accelerate the foreclosure process in Florida. Republican, Kathleen Passidomo, sponsor of HB 87, frames the bill as a way to speed up the foreclosure process while ensuring due process. But, lenders and borrowers alike are fearful of some of the Bill’s provisions.

The current Bill, which is a revision of a bill that died last year in the Senate, provides liability for entities that wrongfully claim to be holders of or entitled to enforce lost notes. Thus, the Bill might provide an incentive for the “foreclosure mills” to have their paperwork in order before filing suit. However, this penalty of perjury is not a new concept to the judicial system. The problem has not been whether there is a penalty for perjury, but rather whether a judge will deem evidence to be fraudulent. Discovery requests that attempt to uncover facts and evidence related to the validity of a lender’s evidence are almost always objected to on grounds of relevance. And these objections are rarely overruled when challenged in court. The borrower’s only hope is that the evidence (usually related to transfer of a loan) is defective on its face. In which case, the evidence is usually just disregarded as flawed–rather than deemed fraudulent.

[Parker & DuFresne]

Once a Scam, ALWAYS a Scam.

NYT-

IN January, federal regulators announced an $8.5 billion agreement with 10 mortgage servicers to settle claims of foreclosure abuses, including bungled loan modifications and the wrongful evictions of borrowers who were either current on their payments or making reduced monthly payments.

Under the deal, announced by the Federal Reserve and the Office of the Comptroller of the Currency, the mortgage servicers will pay $3.3 billion to borrowers who went through foreclosure in 2009 and 2010 and an additional $5.2 billion to reduce the principal or the monthly payments of borrowers in danger of losing their homes.

Those numbers might look impressive, but the deal is far too modest to be a credible deterrent to reckless foreclosure practices.

[NEW YORK TIMES]

image: resume-not-required.com

How did Wells Fargo acquire any interest to the Vance’s property?? The original lender and the only lender of this 2004 mortgage/note was Universal Home Mortgage Company, LLC. /Lennar Corp according to public records. Don’t believe me take a look for yourself.

Keep your eye on this one because there is NO Assignment filed at all or prior to the Lis Pendens The Florida Default Law Group P.L. filed back on 9/2010.

Herald Tribune-

Osteoporosis prevents the East Bradenton widow from climbing a flight of stairs. Chronic bronchitis makes it difficult breathing around carpets, prompting Vance to break out in vicious coughing attacks from the allergens in the fibers.

Now 72, she expected to spend life’s final chapter in the single-story home with tile floors and electric appliances — installed because gas fumes make her too dizzy to stand.

[HERALD TRIBUNE]

UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT

ANDREW MELLENTINE; DEBRA MELLENTINE,
Plaintiffs-Appellants,

v.

AMERIQUEST MORTGAGE COMPANY; WM
SPECIALTY MORTGAGE LLC, Without Recourse;
CITI RESIDENTIAL LENDING, INC.; MORTGAGE
ELECTRONIC REGISTRATION SYSTEMS, INC.;
CHASE HOME FINANCE, LLC; JP MORGAN
CHASE BANK NA; ORLANS ASSOCIATES P.C.;
UNKNOWN LENDERS;
Defendants-Appellees.

ON APPEAL FROM THE
UNITED STATES DISTRICT
COURT FOR THE EASTERN
DISTRICT OF MICHIGAN

BEFORE: MOORE and COLE, Circuit Judges; ROSE, District Judge.*
COLE, Circuit Judge. Plaintiffs-Appellants Andrew and Debra Mellentine filed suit against
a number of defendants who, among other things, hold or service a mortgage on their residential
property. In district court, the case was narrowed to claims under two federal statutes, the Fair Debt
Collection Practices Act (“FDCPA”) and the Real Estate Settlement and Procedures Act (“RESPA”).
The Mellentines now appeal the district court’s grant of Defendants’ motions to dismiss under
Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief could be
granted and Rule 12(c) for judgment on the pleadings. For the following reasons, we REVERSE and
REMAND in part and AFFIRM in part.

[…]

In early May 2011, Orlans, Ameriquest, and CitiRL all filed separate motions to dismiss for
failure to state a claim under Rule 12(b)(6). The Mellentines filed a single response on May 24,
2011. Chase, JP Morgan, MERS, and WM subsequently filed a combined motion for judgment on
the pleadings under Rule 12(c). The Mellentines then filed a response to the Rule 12(c) motion and
also moved for judgment on the pleadings themselves. In their response to the motion to dismiss,
the Mellentines withdrew their TILA and HOEPA claims, leaving only their RESPA and FDCPA
claims at issue.

[…]

II. Standard of Review

Whether the district court properly dismissed a complaint pursuant to Rule 12(b)(6) is a
question of law subject to review de novo. Kottmyer v. Maas, 436 F.3d 684, 688 (6th Cir. 2006).
The court must construe the complaint in a light most favorable to the plaintiff and accept all factual
allegations as true. Kottmyer, 436 F.3d at 688. The factual allegations must “raise a right to relief
above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). In other words,
the Rule 12(b)(6) standard requires that a plaintiff provide “enough facts to state a claim to relief that
is plausible on its face.” Id. at 569.

“While legal conclusions can provide the framework of a complaint, they must be supported
by factual allegations.” Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009). Bare allegations without a
factual context do not create a plausible claim. Ctr. for Bio-Ethical Reform, Inc. v. Napolitano, 648
F.3d 365, 374 (6th Cir. 2011). A complaint must “contain[] direct or inferential allegations
respecting all the material elements under some viable legal theory.” Mezibov v. Allen, 411 F.3d
712, 716 (6th Cir. 2005). The bare assertion of legal conclusions is not enough to constitute a claim
for relief. Id. at 716.

A ruling on a motion for judgment on the pleadings under Rule 12(c) is generally reviewed
under the same standard as a Rule 12(b)(6) motion. EEOC v. J.H. Routh Packing Co., 246 F.3d 850,
851 (6th Cir. 2001).

III. FDCPA Claims

The purpose of the FDCPA is to “eliminate abusive debt collection practices by debt
collectors, to insure that those debt collectors who refrain from using abusive collection practices
are not competitively disadvantaged and to promote consistent State action to protect consumers
against debt collection abuses.” 15 U.S.C. § 1692(e). Liability under the FDCPA can only attach to
those who meet the statutory definition of a “debt collector.”

A. Claim Against Orlans

The Mellentines seek relief against Orlans under the FDCPA. The district court held that a
law firm enforcing a security interest in a mortgage could not meet the definition of a “debt
collector” under the FDCPA. Since the district court ruled in the instant case, this Court has ruled
to the contrary. Glazer v. Chase Home Finance LLC, No. 10-3416, 2013 WL 141699, at *5-9 (6th
Cir. Jan. 14, 2013). In Glazer we held that “mortgage foreclosure is debt collection under the Act.
Lawyers who meet the general definition of a ‘debt collector’ must comply with the FDCPA when
engaged in a mortgage foreclosure. And a lawyer can satisfy that definition if his principal business
purpose is mortgage foreclosure or if he ‘regularly’ performs this function.” Id. at *9. In light of
Glazer, we are left only to determine if the Mellentines’ complaint is sufficient to allege that Orlans
is a debt collector under the FDCPA.

[…]

B. Claim Against Chase

The Mellentines appeal the RESPA claim against Chase. The district court dismissed this
claim pursuant to Chase’s Rule 12(c) motion to dismiss. The court held that the Mellentines failed
to plead either actual damages or a pattern or practice of noncompliance as is required to recover
under RESPA § 2605(f). We find that the complaint pleads sufficient facts to state a claim under
REPSA.

A ruling on a motion for judgment on the pleadings under Rule 12(c) is generally reviewed
under the same standard as a Rule 12(b)(6) motion. J.H. Routh Packing Co., 246 F.3d at 851. “[A]
complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations,”
however, it must assert sufficient facts to provide the defendant with “fair notice of what the . . .
claim is and the ground upon which it rests.” Twombly, 550 U.S. at 555 (internal quotation marks
and citations omitted) (second alteration in original). In assessing a motion to dismiss, a Court
evaluates whether “the plaintiff plead[ed] factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. “If a
reasonable court can draw the necessary inference from the factual material stated in the complaint,
the plausibility standard has been satisfied.” Keys v. Humana, Inc., 684 F.3d 605, 610 (6th Cir.
2012).

The Mellentines have met this standard. They have alleged in their complaint that Chase
“sen[t] a signed response that [was] 10 days late” to their QWR. They furthermore alleged “damages
in an amount not yet ascertained, to be proven at trial.” Section 2605(e) of RESPA sets the response
time within which loan servicers must respond to QWRs—60 days at the time the Mellentines are
alleged to have sent their request. Because the complaint alleges that Chase submitted its response
to the QWR after the statutory time period, the Mellentines’ claim sufficiently sets forth facts upon
which relief can be granted.

Should state lawmakers speed up the foreclosure process?

[click image below]

NYT-

MANY people became rightfully upset about bailouts given to big banks during the mortgage crisis. But it turns out that they are still going on, if more quietly, through the back door.

The existence of one such secret deal, struck in July between the Federal Reserve Bank of New York and Bank of America, came to light just last week in court filings.

That the New York Fed would shower favors on a big financial institution may not surprise. It has long shielded large banks from assertive regulation and increased capital requirements.

[NEW YORK TIMES]

image: bimagazine.org

What do YOU desire?

What do YOU want to do?

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How long did it take for them to make this cash and what happens to the over 1 MILLION fraudulent documents to homes?

Did anyone bother to check on the assignments created in 2008 for the Bain v Metropolitan case out of Washington executed by Bethany Hood and Christina Allen? If not, this did not involve Lorraine Brown or DocX. Just a hint.

Not to mention the connections of a former attorney, George Anhang from both Covington & Burling and Dewey & LeBoeuf law firms that represented LPS in the defense of a securities class action…which also settled recently.

Reuters-

The mortgage servicing company Lender Processing Services Inc has agreed to pay $35 million to resolve a federal criminal investigation into foreclosure fraud, the U.S. Department of Justice said on Friday.

The settlement resolves allegations over the Jacksonville, Florida-based company’s involvement in what the government called a six-year scheme to prepare and file more than 1 million fraudulently signed and notarized mortgage documents in property recorders’ offices nationwide.

It followed a guilty plea last November by Lorraine Brown, the former chief executive of LPS’ DocX LLC unit, to a felony charge of conspiracy to commit mail and wire fraud over the scheme, which ran from 2003 to 2009.

[REUTERS]

Obviously MERS is a huge, HUGE problem and judges need to give it the ultimate Boot and go back to real property law…confused yet with other courts throwing MERS to the curb and others thinking it’s ok?? Capiche?

What taxpayer gave the banks permission to just come in and destroy our property/land record offices with this PRIVATE system that they can use to circumvent fees? Can we do this as individuals? The Answer is NO.

We introduce this subject with a riddle: What entity is not a bank but claims to hold title to approximately half of all the mortgaged homes in the country? The answer is MERS.

United States Court of Appeals
For the First Circuit

ORATAI CULHANE,
Plaintiff, Appellant,

v.

AURORA LOAN SERVICES OF NEBRASKA,
Defendant, Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS

[Hon. William G. Young, U.S. District Judge]
Before
Lynch, Chief Judge,
Souter,* Associate Justice,
and Selya, Circuit Judge.

George E. Babcock, with whom Rockwell P. Ludden and Ludden
Kramer Law P.C. were on brief, for appellant.
Reneau J. Longoria, with whom John A. Doonan, Erin P. Severin

and Doonan, Graves & Longoria, LLC were on brief, for appellee.
February 15, 2013

SELYA, Circuit Judge. As the millennium dawned, American
financial markets soared to new heights. One of the vehicles that
propelled this dizzying flight involved the bundling and
securitization of residential mortgage loans. But all good things 1
come to an end, cf. Geoffrey Chaucer, Troilus and Criseyde (circa
1374) (“There is an end to everything, to good things as well.”),
and it was not long before the economy faltered and the housing
bubble burst. A rash of residential mortgage foreclosures
followed.

Novel practices had been devised to facilitate the
bundling and securitization of residential mortgage loans — and
those practices gave rise to hitherto unanswered questions in the
foreclosure context. The fact pattern here is emblematic: the
mortgagor’s note was delivered to one party (the lender) and then
transferred; the mortgage itself was granted to a different entity,
Mortgage Electronic Registration Systems, Inc., and later assigned 2
to the foreclosing entity. We are asked, as a matter of first
impression for this court, to pass upon not only the legality and
effect of this arrangement but also the mortgagor’s right to
challenge it. The substantive law of Massachusetts controls our
inquiry.

[…]

Under the terms of the mortgage, MERS, as mortgagee of
record, held legal title to the mortgaged premises. As such, it
enjoyed a power of sale “solely as nominee” for the lender.
At this juncture, we think it helpful to provide some
background about the mysterious entity known as MERS. We introduce
this subject with a riddle: What entity is not a bank but claims to
hold title to approximately half of all the mortgaged homes in the
country? The answer is MERS. See Michael Powell & Gretchen
Morgenson, MERS? It May Have Swallowed Your Loan, N.Y. Times, Mar.
6, 2011, at BU1.

[…]

Should be Systems, Inc.  and not Service, Inc.

Kare11-

Minnesota’s two largest counties have joined together to file a lawsuit against the Mortgage Electronic Registration Service, Inc. (MERS) on behalf of taxpayers and all other counties in Minnesota, alleging that MERS has likely deprived states and counties of somewhere around $7.2 billion nationally.

Established in 1995 by many of the nation’s largest mortgage lending institutions, the plaintiffs say MERS was formed to create a semi-private system for MERS members to quickly and cheaply assign their mortgages to one another.

Unfortunately, says the office of Ramsey County Attorney John Choi, this came at the expense of the integrity of our public land records and of county taxpayers in lost recording fees.

[KARE11]

The Government could and should have sued him and won!

Alison Frankel:

In 2008, plaintiffs’ lawyers were so close to lassoing onetime Countrywide chairman Angelo Mozilo in a derivative suit that they could practically smell his aftershave. The housing market had crashed, new details of Countrywide’s dubious underwriting were emerging every day and the mortgage lender’s shares had plummeted from $45 to $5. Shareholders in a consolidated derivative suit before U.S. District Judge Mariana Pfaelzer had survived a motion to dismiss their claims against Countrywide’s directors and officers and were headed into discovery.

You know what happened next: Bank of America acquired what remained of Countrywide. And that was the end of the derivative suit against the Countrywide board, according to a December 2008 ruling by Pfaelzer, who found that the old Countrywide shareholders didn’t have standing to sue because the stock-for-stock BofA deal extinguished their stock ownership.

[REUTERS ON THE CASE]

Nailed ‘Em – Richard Eggers

One bank finally nails the highest level white-collar mortgage banker to date: a 68-year-old customer service representative.

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Why didn’t they just go with Neil Barofsky?

Reason. He’s the right one to go after the Wall Street and Hard!

Bloomberg-

Here’s the big question for Mary Jo White: If she becomes chairman of the Securities and Exchange Commission, where will her interests lie? With the public that pays her salary? Or with the people handing her the big bucks?

White is the white-collar defense lawyer and former U.S. attorney nominated by President Barack Obama to lead the SEC. Her financial disclosures say that upon leaving New York-based Debevoise & Plimpton LLP, the law firm will give her $42,500 a month in retirement pay for life, or more than $500,000 a year.

[BLOOMBERG]

image: NYT