JOHN KENNERTY, a/k/a HERMAN JOHN KENNERTY

JOHN KENNERTY a/k/a Herman John Kennerty has been employed for many years in the Ft. Mill, SC offices of America’s Servicing Company, a division of Wells Fargo Bank, N.A. He signed many different job titles on mortgage-related documents, often using different titles on the same day. He often signs as an officer of MERS (“Mortgage Electronic Registration Systems, Inc.”) On many Mortgage Assignments signed by Kennerty, Wells Fargo, or the trust serviced by ASC, is shown as acquiring the mortgage weeks or even months AFTER the foreclosure action is filed.

Titles attributed to John Kennerty include the following:

Asst. Secretary, MERS, as Nominee for 1st Continental Mortgage Corp.;

Asst. Secretary, MERS, as Nominee for American Brokers Conduit;

Asst. Secretary, MERS, as Nominee for American Enterprise Bank of Florida;

Asst. Secretary, MERS, as Nominee for American Home Mortgage;

Asst. Secretary, MERS, as Nominee for Amnet Mortgage, Inc. d/b/a American Mortgage Network of Florida;

Asst. Secretary, MERS, as Nominee for Bayside Mortgage Services, Inc.;

Asst. Secretary, MERS, as Nominee for CT Mortgage, Inc.;

Asst. Secretary, MERS, as Nominee for First Magnus Financial Corporation, an Arizona Corp.;

Asst. Secretary, MERS, as Nominee for First National Bank of AZ;

Asst. Secretary, MERS, as Nominee for Fremont Investment & Loan;

Asst. Secretary, MERS, as Nominee for Group One Mortgage, Inc.;

Asst. Secretary, MERS, as Nominee for Guaranty Bank;

Asst. Secretary, MERS, as Nominee for Homebuyers Financial, LLC;

Asst. Secretary, MERS, as Nominee for IndyMac Bank, FSB, a Federally Chartered Savings Bank (in June 2010);

Asst. Secretary, MERS, as Nominee for Irwin Mortgage Corporation;

Asst. Secretary, MERS, as Nominee for Ivanhoe Financial, Inc., a Delaware Corp.;

Asst. Secretary, MERS, as Nominee for Mortgage Network, Inc.;

Asst. Secretary, MERS, as Nominee for Ohio Savings Bank;

Asst. Secretary, MERS, as Nominee for Paramount Financial, Inc.;

Asst. Secretary, MERS, as Nominee for Pinnacle Direct Funding Corp.;

Asst. Secretary, MERS, as Nominee for RBC Mortgage Company;

Asst. Secretary, MERS, as Nominee for Seacoast National Bank;

Asst. Secretary, MERS, as Nominee for Shelter Mortgage Company, LLC;

Asst. Secretary, MERS, as Nominee for Stuart Mortgage Corp.;

Asst. Secretary, MERS, as Nominee for Suntrust Mortgage;

Asst. Secretary, MERS, as Nominee for Transaland Financial Corp.;

Asst. Secretary, MERS, as Nominee for Universal American Mortgage Co., LLC;

Asst. Secretary, MERS, as Nominee for Wachovia Mortgage Corp.;

Vice President of Loan Documentation, Wells Fargo Bank, N.A.;

Vice President of Loan Documentation, Wells Fargo Bank, N.A., successor by merger to Wells Fargo Home Mortgage, Inc. f/k/a Norwest Mortgage, Inc.

From Lynn Szymoniak

Jeffrey Stephan, who actually works for GMAC Mortgage Corp. in Montgomery County, PA, signs thousands of Mortgage Assignments each month as an officer of other banks and mortgage companies in order to transfer mortgages TO GMAC. In Florida, the law firms that regularly present documents signed by Jeffrey Stephans as “proof” that GMAC has standing to foreclose include The Law Offices of Marshall Watson, The Law Offices of David Stern and Florida Default Law Group.

Stephan has admitted in depositions that he has no personal knowledge of the facts of documents he signs, does not verify the facts, and often does not sign in front of a notary (though the documents are eventually notarized).

Titles used by Jeffrey Stephan include the following:

(“MERS” stands for Mortgage Electronic Registration Systems, Inc.)

Vice President, MERS as Nominee for American Interbanc Mortgage , LLC;

Vice President, MERS as Nominee for Cardinal Financial Co., Ltd. Partnership;

Vice President, MERS as Nominee for Centerpoint Financial, Inc.;

Vice President, MERS as Nominee for Central Pacific Mortgage Corp.;

Vice President, MERS as Nominee for Certified Home Loans of Florida, Inc.;

Vice President, MERS as Nominee for Gateway Mortgage Group, LLC;

Vice President, NERS as Nominee for GMAC Bank;

Vice President, MERS as Nominee for GMAC Mortgage Corp. d/b/a Ditech.com;

Vice President, MERS as Nominee for Great Country Mortgage Bankers Corp.;

Vice President, MERS as Nominee for Greenpoint Mortgage Funding, Inc.

Vice President, MERS as Nominee for Group One Mortgage, Inc.;

Vice President, MERS as Nominee for Homecomings Financial Network, Inc,;

Vice President, MERS as Nominee for Lexon Financial Mortgage Corp. d/b/a Weslend Financial Corp.;

Vice President, MERS as Nominee for Mortgage Investors Corp.;

Vice President, MERS as Nominee for Pinnacle Financial Corp. d/b/a Tri Star Lending Group

Vice President, MERS as Nominee for Popular Mortgage Corp.;

Vice President, MERS as Nominee for Premier Mortgage Funding;

Vice President, MERS as Nominee for Quicken Loans;

Vice President, MERS as Nominee for Sky Investments d/b/a North Star Lending;

Vice President, MERS as Nominee for Transland Financial Services, Inc.; and

Vice President, MERS as Nominee for USAA Federal Savings Bank

Read more on…Jeffery Stephan

Linda Green
Lender Processing Services
Shapiro & Fishman

Action Date: August 26, 2010
Location: Fort Lauderdale, FL

On August 11, 2010, the Florida foreclosure mill law firm of Shapiro & Fishman (S&F) filed a “corrective” mortgage assignment (copy available in the “Pleadings” section herein). According to S & F, this “corrective” assignment was necessary because previous assignments filed by S & F were signed by Linda Green “who at that time did not have signing authority on behalf of MERS.” The day before, on August 10, 2010, the Florida Attorney General’s office issued a press release identifying S & F as one of the Florida law firms under investigation for unfair & deceptive trade practices involving improper documentation used to speed foreclosure proceedings. When Linda Green signed the prior assignments as a MERS officer, she was actually employed by Lender Processing Services in its Alpharetta, Georgia offices. Lender Processing Services decides which law firms get assigned foreclosure cases by the banks in hundreds of thousands of cases. Lender Processing Services hires the law firms and provides these firms with the documents they might need – using its own employees to sign the documents – without authority from MERS. The “corrective” assignment was signed by Kathy Smith and Joseph Kaminski who were identified as Assistant Secretaries of MERS, as nominee for American Brokers Conduit ( a company in bankruptcy since 2007). Smith & Kaminski are not actually employed by MERS or by American Brokers Conduit – so S&H may need another “corrective assignment.” The original assignment was dated October 17, 2008 – over two weeks AFTER the Lis Pendens was filed, but the “corrective” assignment attempts to solve the obvious lack of standing by a provision that states that the actual delivery of the documents took place on an unspecified date “and that such delivery of documents had occurred before default and before the filing to the lis pendens…” Courts and homeowners can expect a few more corrections from Shapiro & Fishman.

So they say…

This is Linda Green they are admitting to as not having authority for MERS. Linda Green is an employee of DOCx/ LPS!

While they view it as not having authority, I view it as plain out FRAUD!

Both Kathy Smith and Joseph Kaminski are employees of Lender Processing Services in Jacksonville aka Duval County.

Take a look at the Corrective Assignment below:

Now take a look at why…lets compare the signatures

On Tuesday the Florida Attorney General Bill McCollum’s office announced an investigation of Three South Florida law firms.

The firms are identified as The Law Offices of Marshall C. Watson in Fort Lauderdale; Shapiro & Fishman, which has offices in Boca Raton and Tampa; and the Law Offices of David J. Stern, P.A. in Plantation.

By Lynn E. Szymoniak, Esq. Ed., Fraud Digest (www.frauddigest.com) July 18, 2010

These are highlights from the deposition of Jeffrey B. Stephan, taken June 7, 2010, in a foreclosure case in Maine, Federal National Mortgage Association v. Nicole M. Bradbury, et al., Maine District Court, District Nine, Division of Northern Cumberland, Docket No. BRI-RE-09-65. The deposition was taken by Attorney Thomas Cox of Portland, Maine.

Jeffrey Stephan says his current title is team leader of the document execution team for GMAC. He estimates that he signs between 8,000 and 12,000 documents monthly. He supervises a team of 14 employees.

Mortgage Assignments and Affidavits in support of Summary Judgment signed by Stephan have been used by GMAC, FANNIE & FREDDIE in over 100,000 foreclosure cases.

“LPS” in the last line refers to Lender Processing Services in Jacksonville, Florida.

In a previous deposition, Stephan stated that the notaries who notarize his signature are often not actually present in the room with him when he signs documents.

Despite all of the mounting evidence and admissions, Jeffrey Stephan, Scott Anderson, Bryan Bly, Linda Green, Erica Johnson-Seck, Christina Trowbridge and the other “bank officers” employed by the companies serving the securitized
mortgage-backed trust industry will be back at their desks Monday morning, pens (or rubber stamps) in hand.

Page 16-17, Lines 17-25, 2-11

Q: What training have you received?

A: I received side-by-side training from another team leader to instruct me on how to review the documents when they are received from my staff.

Q: Who was that person?

A: That person, at the time, I believe, was a gentleman named Kenneth Ugwuadu. U-G-W-U-A-D-U. He is no longer with GMAC.

Q: How long did that training last?

A: Three days.

Q: Were there any written or printed training materials or manuals used as apart of that training?

A: No.

Page 20, Lines 19-24:

Q.: In your capacity as the team leader for the document execution team, do you have any role in the foreclosure process, other than the signing of documents?

A: No.

Page 54, Lines 12-25:

Q: When you sign a summary judgment affidavit, do you check to see if all of the exhibits are attached to it?

A: No.

Q. Does anybody in your department check to see if all the exhibits are attached to it at the time that it is presented to you for your signature?

A: No.

Q: When you sign a summary judgment affidavit, do you inspect any exhibits attached to it?

A: No.

Page 62-63, Lines 23-25, 2-6:

Q: Is it fair to say when you sign a summary judgment affidavit, you don’t know what information it contains, other than the figures that are set forth within it?

A: Other than the borrower’s name, and if I have signing authority for that entity, that is correct.

Page 69, Lines 2-20:

Q: Mr. Stephan, referring you again to the bottom line on Page 1 of Exhibit 1, it states: I have under my custody and control, the records relating to the mortgage transaction referenced below.

It’s correct, is it not, that you did not have in your custody any records of GMAC at the time that you signed a summary judgment affidavit?

A: I have the electronic record. I do not have papers.

Q: You have access to a computer, is that what you mean?

A: Yes.
(objections omitted)

Page 45, Lines 2-11:

Q: Mr. Stephan, do you recall testifying in your Florida deposition in December with regard to your employees, and you said, quote, they do not go into the system and verify that the information is accurate?

A: That is correct.

Page 41, Line 19:

Q: Do your employees have any direct communication with outside counsel?

A: Yes, through the LPS System.

Please click on Fraud Digest’s logo to read more articles like this.

Here is the Deposition Below:

Via: 4closurefraud

[ipaper docId=33129394 access_key=key-2ml8jt9qwzgk3qgg0qr0 height=600 width=600 /]

Hasn’t this law firm learned their lesson…time and time again??

Homeowners’ hero judge slaps US Bank

Post staff for NYPOST
Last Updated: 4:42 AM, July 5, 2010
Posted: 12:44 AM, July 5, 2010

Brooklyn’s battling Judge Arthur M. Schack has struck again, giving a Brooklyn homeowner an Independence Day gift — freedom from foreclosure.

The judge, who has steadfastly pressed banks in foreclosure cases to prove they own the troubled mortgage and has tossed cases when banks have failed to do so, has again dismissed a foreclosure case — this time because the lawyer on the case, Steven J. Baum, represented the mortgage broker, the bank that bought the loan and the industry registration service serving as the nominee of the loan.

But Baum’s conflict of interest wasn’t the case’s only problem.

Judge Schack, in his decision, also found that the bank, US Bank, never should have filed the foreclosure action because of an “ineffective assignment of the subject mortgage and note to it.” In other words, it sold the mortgage, and the mortgage was securitized, leaving the company simply as the servicer — but it decided to try and take back the Crown Heights home anyway.

The Post has reported that the actions of the Baum firm in foreclosure cases has caught the eye of the US Trustee, the arm of the Justice Department responsible for monitoring the Bankruptcy Court.

Baum, a Buffalo-based foreclosure mill that filed 12,551 foreclosure actions in New York last year, has been scolded by judges for bringing foreclosure cases without proper documentation.

In this case, a Baum lawyer, Elpiniki Bechakas, signed papers claiming to be an executive of Mortgage Electronic Registration System, or MERS, which was given certain rights to the mortgages by the broker, Fremont Investment and Loan, while simultaneously representing Fremont and US Bank, which filed the foreclosure in July 2009.

“The Court is concerned that the concurrent representation by [the Baum firm] of both assignor MERS, as nominee for Fremont, and assignee plaintiff US Bank is a conflict of interest,” Schack wrote.

Photo Credit: CBS

Absolutely, positively a MUST READ!

edit: From a reader who makes an excellent point…this case is very important because it turns not on the assignment of mortgage which the court disregards but rather on the failure of the originator to file the mortgage loan lists with SEC-the defendant did not even raise the point that there was also a failure to file with delaware so that the trust was never given assets———most importantly AHMSI seems to have focused on acquisition of other ex lenders servicer portolios that systematically failed to file these lists-this could enable ahmsi to have more potential latitude to allocate/reallocate or even pocket collected monies -it ties in with the comments later last week re junior senior tranche——if there is no clear certainty as to who gets money from foreclosures due to the record breakdown —-then if the money were to go to tranches that have been written off by their owners —–then the servicer can pocket the proceeds———–the servicers are unregulated–who is looking at their allocations?

the real questions now-are the loans actually in the hands of trusts as a matter of law as a result of failed filings and what happens to proceeds of collection of foreclosure proceeds??

These are highlights…

SUPERIOR COURT OF NEW JERSEY

BANK OF NEW YORK, as Trustee for Home Mortgage Investment Trust CHANCERY DIVISION
2004-4 Mortgage-Backed Notes, ATLANTIC COUNTY Series 2004-4 DOCKET NO: F-7356-09

vs.

MICHAEL J. RAFTOGIANIS,

Decided June 29, 2010

This opinion deals with the plaintiff’s right to proceed with an action to foreclose a mortgage which secures a debt evidenced by a negotiable note. The original lender elected to use the Mortgage Electronic Registration System in recording the mortgage by designating that entity, as its nominee, as the mortgagee. The note and mortgage were subsequently securitized, without notice to the borrower. This action to foreclose the mortgage was filed years later, in the name of an entity created as a part of the securitization process. The defendant/borrower challenged plaintiff’s right to proceed with the foreclosure. That challenge, framed as a dispute over “standing,” has given rise to a variety of factual and legal issues typically raised in this type of litigation.

Ultimately, the questions presented were whether plaintiff could establish its right to enforce the obligation evidenced by the note and whether it must establish that it held that right at the time the complaint was filed. The answers to those questions require an understanding of the provisions of the Uniform Commercial Code, the Mortgage Electronic Registration System, the securitization of mortgages and how foreclosure litigation is handled. This opinion addresses those disputes. Ultimately, the court concluded that it was appropriate to require plaintiff to establish that it had physical possession of the note as of the date the complaint was filed. Plaintiff was unable to establish that, either by motion or at trial. Accordingly, the complaint has now been dismissed on terms permitting plaintiff to institute a new action to foreclose, on the condition that any new complaint must be accompanied by an appropriate  certification, confirming that plaintiff is then in possession of the note.

In this case, the defendant borrowed $1,380,000 from American Home Mortgage Acceptance Inc. (hereafter American Home Acceptance) in September 2004. This action to foreclose the mortgage was brought in the name of The Bank of New York, as Trustee for American Mortgage Investment Trust 2004-4 Mortgage Backed Notes, Series 2004-4 in February 2009. In the interim, a variety of transactions took place, involving a number of entities. Those transactions will be discussed in some detail below. Preliminarily, this opinion will discuss the UCC, MERS and the securitization process in more general terms.

How does one become a holder of a negotiable note? In addressing that question it is necessary to distinguish between “transfer” and “negotiation.” It is also necessary to distinguish between the handling of notes payable “to order” and notes payable “to bearer.” In this particular case, it is also necessary to recognize that a note initially made payable “to order” can become a bearer instrument, if it is endorsed in blank. See N.J.S.A. 12A:3-109(c), providing that an instrument payable to an identified person may become payable to bearer if it is endorsed in blank. See also N.J.S.A.12A:3-205(b), describing what qualifies as a blank endorsement, and The Law of Modern Payment 6 Systems and Notes 2.02 at 77-78, Miller and Harrell (2002), noting that an instrument bearing the indorsement “Pay to the order of __________” is a bearer instrument. Such a bearer note can be both transferred and negotiated by delivery alone. See Corporacion Venezolana de Fomento v. Vintero Sales, 452 F. Supp. 1108, 1117 (Dist. Ct. 1978).
Under the UCC, the transfer of an instrument requires that it be delivered for the purpose of giving the person receiving the instrument the right to enforce it. A negotiable note can be transferred without being negotiated. That transfer would be effected by the physical delivery of the note. See N.J.S.A. 12A:3-203(a). In that circumstance, the transferee would not be a holder, as that term is used in the UCC. Such a transferee, however, would still have the right to enforce the note. The UCC deals with that circumstance in the following language: Transfer of an instrument, whether or not the transfer is a negotiation, vests in the transferee any right of the transferor to enforce the  instrument, including any right as a holder in due course, but the transferee cannot acquire rights of a holder in due course by a transfer, directly or indirectly, from a holder in due course if the transferee engaged in fraud or illegality affecting the instrument. N.J.S.A. 12A:3-203(b).

The negotiation of the instrument, on the other hand, requires both a transfer of possession and an endorsement by the holder. An instrument which is payable to bearer may be negotiated by transfer alone. Put otherwise, an instrument payable “to order” can be negotiated by delivery with an endorsement, while an instrument payable “to bearer” can be negotiated by delivery alone. N.J.S.A. 12A:3-201. To enforce the note at issue here as a holder pursuant to N.J.S.A. 12A:3-301, plaintiff would have to establish that it received the note, through negotiation, at the appropriate time. That would require that the note be endorsed prior to or at the time of delivery, either in favor of plaintiff or in blank. N.J.S.A. 12A:3-301 also provides that an instrument may be enforced by “a non holder in possession of the instrument who has the rights of a holder.” How does one obtain that status? That may occur, by example, where a creditor of a holder acquires an instrument through execution. See The Law of Modern Payment Systems and Notes 3.01 Miller and Harrell (2002). More frequently, that status will be created by the “transfer” of the instrument, without negotiation. As already noted, transfer occurs when the instrument is delivered for the purpose of giving the person receiving the instrument the right to enforce it. See N.J.S.A. 12A:3-203(a). The statute also provides that the transfer of the instrument, without negotiation, vests in the transferee the transferor’s right to enforce the instrument. See N.J.S.A. 12A:3-203(b). That circumstance can be illustrated by reference to the dispute presented here. The note at issue, as originally drafted, was payable “to the order of” the original lender. The negotiation of the note, in that form, would require endorsement, either to a designated recipient of the note or in blank. The note, however, could be transferred without an endorsement. Assuming the transfer was for the purpose of giving the recipient the ability to enforce the note, the recipient would become a “nonholder in possession with the rights of a holder.” That would require, however, the physical delivery of the note. A number of cases recognize that there can be constructive delivery or possession, through the delivery of the instrument to an agent of the owner. See Midfirst Bank, SSB v. C.W. Haynes & Company, 893 F. Supp. 1304, 1314-1315 (S.C. 1994); Federal Deposit Insurance Corp. v. Linn, 671 F. Supp. 547, 553 8 (N.D. Ill. 1987); and Corporacion Venezolana de Fomento v. Vintero Sales Corp, 452 F. Supp. 1108, 1117 (S.D.N.Y. 1978). Under either of the provisions of N.J.S.A.12A:3-301 which are at issue here, the person seeking to enforce the note must have possession. That is required to be a holder, and to be a nonholder in possession with the rights of a holder. The application of the provisions of the UCC to the dispute presented here will be discussed below.

MERS The Mortgage Electronic Registration System (hereafter, MERS), is a unique entity. Its involvement in the foreclosure process has been the subject of a substantial amount of litigation throughout the country, resulting in the issuance of a number of reported opinions. Recently, MERS was the focus of a decision of the Supreme Court ofKansas, reported as Landmark National Bank v. Kesler, 289 Kan. 528, 216 P.3d. 158 (Kan. 2009) which is now cited frequently in this court. That opinion reviews the manner in which MERS functions, the potential problems it can create, and some of the competing policy issues presented. The opinion also cites a variety of published opinionsfrom around the country, addressing those same issues.

In essence, MERS is a private corporation which administers a national electronic registry which tracks the transfer of ownership interests and servicing rights in mortgage loans. Lenders participate as members of the MERS system. When mortgage loans are initially placed, the lenders will retain the underlying notes but can arrange for MERS to be designated as the mortgagees on the mortgages which become a part of the public record. In that context, the lenders are able to transfer their interests to others, without having to record those subsequent transactions in the public record. See Mortgage Elec. Reg. Sys. Inc. v. Nebraska Depart. Of Banking, 270 Neb. 529, 530, 704 N.W.2d 784 (2005), cited in Landmark. The process is apparently cost efficient, from the perspective of the lenders. Among other things, the use of MERS permits lenders to avoid the payment of filing fees that might otherwise be required with the filing of multiple assignments. By the same token, it can make it difficult for mortgagors and others to identify the individual or entity which actually controls the debt at any specific time. See Landmark, 216 P.3d. at 168. On occasion, foreclosure actions are also brought in the name of MERS. When MERS is involved, defendant/borrowers often argue there has been a “separation” of the note and mortgage impacting on the plaintiff’s ability to proceed with the foreclosure. That argument has been raised here and will also be addressed below.

SECURITIZATION

This case also involves the securitization of mortgage loans, a practice which is facilitated by the MERS system. Trial courts in this state regularly deal with the foreclosure of mortgages which have previously been securitized. Generally, one or more lenders will sell substantial numbers of mortgage loans they have issued to a pool or trust.

Interests in that pool or trust are then sold to individual investors, who receive certificates entitling them to share in the funds received as the underlying loans are repaid. That can occur without any notice to the debtors/mortgagors who remain obligated on the original notes. Other entities, generally called “servicers,” are retained to administer the underlying loans. Those servicers or additional “subservicers” will be responsible for collecting and distributing the funds which are due from the debtors/mortgagors. Many are given the authority to institute and prosecute foreclosure proceedings.

The note executed by defendant Raftogianis is clearly a negotiable instrument as that term is defined by the UCC. In the terms of the statute, the note is payable to bearer or to order, and it is payable on demand or at a definite time. While the note contains detailed provisions as to just how payment is to be made, it does not state any other undertaking or instruction by the person promising or ordering payment to do any act in addition to the payment of money. See N.J.S.A. 12A:3-104. The note recites that defendant Raftogianis “promises to pay U.S. $1,380,000.00 … plus interest, to the order of the Lender,” then referring to “the Lender” as American Home Acceptance, beginning with payments due in November 2004. See N.J.S.A. 12A:3-104(a)(1), (2) and (3). This note, as originally drafted, was payable “to order.” At some point, however, the note was indorsed in blank. The original note was produced at oral argument on the motion for summary judgment. It contained the following indorsement:

WITHOUT RECOURSE
BY AMERICAN HOME MORTAGE ACCEPTANCE, INC.
_________________________
RENEE BURY
ASST. SECRETARY

Ms. Bury’s original signature was just above her printed name in that indorsement. Defendant had signed the note on September 30, 2004, payable to the order of American Home Acceptance. In that form the note could be transferred by delivery, but could only be negotiated by indorsement. The indorsement in blank, however, would effectively make the note payable “to bearer,” permitting it to be transferred and negotiated by delivery alone, without any additional indorsement. While it was clear the note had been indorsed prior to the time it was presented to the court, presumably as a part of the securitization process, it was not clear just when that occurred, or when the note had been physically transferred from American Home Acceptance to some other individual or entity.

The assignment from MERS was executed and recorded a short time after the complaint was filed. That document is dated February 18, 2009. It is captioned “Assignment of Mortgage.” It recites that MERS, as nominee for American Home Acceptance, transfers and assigns the mortgage at issue to Bank of New York, as Trustee.

The assignment refers to the mortgage as securing the note at issue. It recites the transfer of the mortgage “together with all rights therein and thereto, all liens created or secured thereby, all obligations therein described, the money due and to become due with interest, and all rights accrued or to accrue under such mortgage.” The assignment was executed by one Linda Green, as Vice President of MERS, as nominee for American Home Acceptance. Ms. Green’s signature was notarized. The assignment was recorded with the Atlantic County Clerk on February 24, 2009. It does appear the assignment was intended to indicate that the debt in question had been transferred to the Bank of New York as Indenture Trustee in February 2009. It is now apparent that is not what occurred.

In any event, the matter proceeded in the vicinage based upon the filing of defendant’s contesting answer. While discovery was permitted, the parties apparently elected to forego any formal discovery. Plaintiff filed its motion for summary judgment in January 2010. The motion was based upon a certification from plaintiff’s counsel providing copies of the note, the mortgage and the February 2009 assignment. While the copy of the note provided with the motion did contain the blank indorsement noted above, there was no information provided as to when the note was indorsed, when the note was physically transferred, or where the note was being held. Defendant filed written opposition, challenging the validity of the MERS assignment. Plaintiff responded with a certification executed by a supervisor for American Home Mortgage Servicing, Inc., the servicer for the loans.

THE MERS ASSIGNMENT–THE SEPARATION OF THE NOTE AND MORTGAGE

The issue is framed, at least in part, by the description of MERS as “nominee.” The use of that term, as it is used by MERS, was analyzed in some detail in the decision of the Supreme Court of Kansas in Landmark, a case relied upon by defendant and cited above. Landmark involved a property which was encumbered by two mortgages. The loan provided by Landmark National Bank was secured by a first mortgage payable to it. There was a second mortgage on the property securing a loan that had been provided by Millennia Mortgage Corp. Millennia was a participant in MERS. The second mortgage securing the debt due Millennia was in the name of MERS “solely as nominee” for Millennia. The Millennia mortgage was subsequently transferred or assigned to Sovereign Bank. That transfer was not reflected in the public record. Landmark filed an action to foreclose its first mortgage naming Millennia, but neither MERS nor Sovereign as defendants. No one responded on behalf of Millennia and the matter proceeded through judgment and sale. Sovereign subsequently filed a motion to set aside the judgment, arguing that MERS was a “contingently necessary party” under Kansas law. The trial court concluded that MERS was not a real party in interest and denied the
motion to set aside the judgment. Both the Court of Appeals and the Supreme Court of Kansas affirmed, essentially concluding that MERS did not have any real interest in the underlying debt. Notably, the opinion of the Supreme Court of Kansas recognizes the potential for the separation of interests in a note and related mortgage. In that context, the opinion addressed the use of the term “nominee” in some detail, as follows: The legal status of a nominee, then, depends on the context of the relationship of the nominee to its principal. Various courts have interpreted the relationship of MERS and the lender as an agency relationship. (Citation omitted)
. . .
The relationship that MERS has to Sovereign is more akin to that of a straw man than to a party possessing all the rights given a buyer. A mortgage and a lender have intertwined rights that defy a clear separation of interests, especially when such a purported separation relies on ambiguous contractual language. The law generally understands that a mortgagee is not distinct from a lender: a mortgagee is “[o]ne to whom property is mortgaged: the mortgage creditor, or lender.” Black’s Law Dictionary 1034 (8th ed. 2004). By statute, assignment of the mortgage carries with it the assignment of the debt. K.S.A. 38-2323. Although MERS asserts that, under some situations the mortgage document purports to give it the same rights as the lender, the document consistently refers only to rights of the lender, including rights to receive notice of litigation to collect payments, and to enforce the debt obligation.
The document consistently limits MERS to acting “solely” as the nominee of lender. 289 Kan. 538-540.

While the Landmark court recognized that issues might be raised as to an alleged separation of a note and mortgage, it was not required to address those issues directly. Its analysis of the role MERS plays as nominee, however, supports the conclusion reached by this court with respect to that issue. MERS, as nominee, does not have any real interest in the underlying debt, or the mortgage which secured that debt. It acts simply as an agent or “straw man” for the lender. It is clear to this court that the provisions of the mortgage describing the mortgagee as MERS “as nominee” were not intended to deprive American Home Acceptance of its right to security under the mortgage or to separate the note and mortgage.

It is a fundamental maxim of equity that “[e]quity looks to substance rather than form.” See Applestein v. United Board & Carton Corp., 60 N.J. Super. 333, 348 (Ch.Div. 1960) aff’d o.b., 33 N.J. 72 (1960). The courts have applied that principle in dealing with mortgages in a variety of contexts. So it is that an assignment of a bond or note evidencing a secured obligation will operate as an assignment of the mortgage “in equity.” See 29 New Jersey Practice, Law of Mortgages 11.2, at 748 (Myron C. Weinstein) (2d ed. 2001) (citing Stevenson v. Black, 1 N.J. Eq. 338, 343 (Ch. 1831) and other cases). Conversely, commentators have noted the propriety of treating the assignment of a mortgage, without a specific reference to the underlying obligation, as effectively transferring both interests. But it does not follow that an assignment in terms of the “mortgage” without express reference to the secured obligation is insufficient to transfer the obligation and is therefore a nullity, as some courts have held. As Mr.Tiffany long ago pointed out, The question is properly one of the construction of the language used, and in arriving at the proper construction, evidence of the sense in which that language is ordinarily used is of primary importance. The expression “assignment of  mortgage” is almost universally used, not only by the general public, but also by the Legislature, the courts, and the legal profession, to describe the transfer of the totality of the mortgagee’s rights, that is, his right to the debt as well as to the lien securing it, and to hold, as these cases apparently do, that when one in terms assigns a mortgage, he intends, not an effective transfer of his lien alone, which is an absolute nullity, not only ignores this ordinary use of the term “mortgage”, but is also in direct contravention of the well recognized rule that an instrument shall if possible be construed so as to give it a legal operation. See 29 New Jersey Practice, Law of Mortgages 11.2 at 754(Myron C. Weinstein)(2d ed.2001) (citing 5 Tiffany on Real Property 428-29). It is apparent there was no real intention to separate the note and mortgage at the time those documents were created. American Home Acceptance remained the owner of both the note and mortgage through the date the loan was securitized. It did have the right to transfer its interests when the loan was securitized.

It was entirely appropriate to argue that the February 2009 assignment from MERS, as nominee for American Home Acceptance, to the Bank of New York, as Trustee, was ineffective. From the court’s perspective, that assignment was, at best, a distraction. The actual transfers of interests in the note and mortgage occurred in different ways. There was no reason, however, that plaintiff could not acquire the right to enforce the note and mortgage through those other  transactions. In that context, defendant’s attack on plaintiff’s right to proceed based on the alleged separation of the note and mortgage is rejected.

CONCLUSION

Defendant’s attack on plaintiff’s ability to proceed with the foreclosure based on the alleged “separation” of the note an mortgage was rejected. Plaintiff, however, failed to establish that it was entitled to enforce the note as of the time the complaint was filed.

In this case, there are no compelling reasons to permit plaintiff to proceed in this action. Accordingly, the complaint has been dismissed. That dismissal is without prejudice to plaintiff’s right to institute a new action to foreclose at any time, provided that any new complaint must be accompanied by an appropriate certification, executed by one with personal knowledge of the circumstances, confirming that plaintiff is in possession of the original note as of the date any new action is filed. That certification must indicate the physical location of the note and the name of the individual or entity in possession.

An appropriate order has been entered

[ipaper docId=33897904 access_key=key-254ukf9s9ezv8ci0pex0 height=600 width=600 /]

2010 NY Slip Op 50927(U)

HSBC BANK USA, N.A. AS TRUSTEE FOR NOMURA ASSET-BACKED CERTIFICATE SERIES

2006-AF1,, Plaintiff,
v.
LOVELY YEASMIN, ET. AL., Defendants.

34142/07

Supreme Court, Kings County.

Decided May 24, 2010.

Steven J Baum, PC, Amherst NY, Plaintiff — US Bank.

ARTHUR M. SCHACK, J.

Plaintiff’s renewed motion for an order of reference, for the premises located at 22 Jefferson Street, Brooklyn, New York (Block 3170, Lot 20, County of Kings), is denied with prejudice. The instant action is dismissed and the notice of pendency for the subject property is cancelled. Plaintiff HSBC BANK USA, N.A. AS TRUSTEE FOR NOMURA ASSET-BACKED CERTIFICATE SERIES 2006-AF1 (HSBC) failed to comply with my May 2, 2008 decision and order in the instant matter (19 Misc 3d 1127 [A]), which granted plaintiff HSBC leave:

to renew its application for an order of reference for the premises located at 22 Jefferson Street, Brooklyn, New York (Block 3170, Lot 20, County of Kings), upon presentation to the Court, within forty-five (45) days of this decision and order of:

(1) a valid assignment of the instant mortgage and note to plaintiff, HSBC . . .;

(2) an affirmation from Steven J. Baum, Esq., the principal of Steven J. Baum, P.C., explaining if both MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. [MERS], the assignor of the instant mortgage and note, and HSBC . . . the assignee of the instant mortgage and note, pursuant to 22 NYCRR § 1200.24, consented to simultaneous representation in the instant action, with “full disclosure of the implications of the simultaneous representation and the advantages and risks involved” explained to them;

(3) compliance with the statutory requirements of CPLR § 3215 (f), by an affidavit of facts executed by someone with authority to execute such an affidavit, and if the affidavit of facts is executed by a loan servicer, a copy of a valid power of attorney to the loan servicer, and the servicing agreement authorizing the affiant to act in the instant foreclosure action; and

(4) an affidavit from an officer of plaintiff HSBC . . . explaining why plaintiff HSBC . . . purchased a nonperforming loan from MERS, as nominee for CAMBRIDGE HOME CAPITAL, LLC [CAMBRIDGE].

[Emphasis added]

Plaintiff made the instant motion on January 6, 2009, 249 days subsequent to the May 2, 2008 decision and order. Thus, the instant motion is 204 days late. Plaintiff’s unavailing lateness explanation, in ¶ 16 of plaintiff’s counsel’s January 6, 2009 affirmation of regularity, states:

A previous application has been made for this or like relief but was subsequently denied without prejudice with leave to renew upon proper papers. By Decision and Order of this court dated the 2nd day of May 2008, plaintiff had 45 days to renew its application.

However on June 29, 2008 the Plaintiff permitted the mortgagor to enter into a foreclosure forbearance agreement. Said agreement was entered into with the hope that the Defendant would be able to keep her home. The agreement was not kept by the mortgagor and Plaintiff has since resumed the foreclosure action. The defects of the original application are addressed in the Affirmation attached hereto at Tab F [sic].

June 29, 2008 was 58 days subsequent to May 2, 2008. This was 13 days subsequent to the Court ordered deadline for plaintiff to make a renewed motion for an order of reference. While it’s laudatory for plaintiff HSBC to have granted defendant a forbearance agreement, plaintiff HSBC never notified the Court about this or sought Court approval of extending the 45-day deadline to make the instant motion. However, even if the instant motion was timely, the documents plaintiff’s counsel refers to at Tab F [exhibit F of motion] do not cure the defects the Court found with the original motion and articulated in the May 2, 2008 decision and order.

Background

Defendant LOVELY YEASMIN borrowed $624,800.00 from CAMBRIDGE on May 10, 2006. The note and mortgage were recorded by MERS, as nominee for CAMBRIDGE, for purposes of recording the mortgage, in the Office of the City Register, New York City Department of Finance, on May 23, 2006, at City Register File Number (CRFN) XXXXXXXXXXXXX. Then, MERS, as nominee for CAMBRIDGE, assigned the mortgage to plaintiff HSBC on September 10, 2007, with the assignment recorded in the Office of the City Register, on September 20, 2007, at CRFN XXXXXXXXXXXXX. The assignment was executed by “Nicole Gazzo, Esq., on behalf of MERS, by Corporate Resolution dated 7/19/07.” Neither a corporate resolution nor a power of attorney to Ms. Gazzo were recorded with the September 10, 2007 assignment. Therefore, the Court found the assignment invalid and plaintiff HSBC lacked standing to bring the instant foreclosure action. Ms. Gazzo, the assignor, according to the Office of Court Administration’s Attorney Registration, has as her business address, “Steven J. Baum, P.C., 220 Northpointe Pkwy Ste G, Buffalo, NY 14228-1894.” On September 10, 2008, the same day that Ms. Gazzo executed the invalid assignment for MERS, as nominee for CAMBRIDGE, plaintiff’s counsel, Steven J. Baum, P.C., commenced the instant action on behalf of purported assignee HSBC by filing the notice of pendency, summons and complaint in the instant action with the Kings County Clerk’s Office. The Court, in the May 2, 2008 decision and order, was concerned that the simultaneous representation by Steven J. Baum, P.C. of both MERS and HSBC was a conflict of interest in violation of 22 NYCRR § 1200.24, the Disciplinary Rule of the Code of Professional Responsibility entitled “Conflict of Interest; Simultaneous Representation,” then in effect. Further, plaintiff’s moving papers for an order of reference and related relief failed to present an “affidavit made by the party,” pursuant to CPLR § 3215 (f). The instant application contained an “affidavit of merit and amount due,” dated November 16, 2007, by Cathy Menchise, “Senior Vice President of WELLS FARGO BANK, N.A. D/B/A AMERICA’S SERVICING COMPANY, Attorney in Fact for HSBC BANK USA, N.A. AS TRUSTEE FOR NOMURA ASSET-BACKED CERTIFICATE SERIES 2006-AF1.” Ms. Menchise stated “[t]hat a true copy of the Power of Attorney is attached hereto.” Actually attached was a photocopy of a “Limited Power of Attorney,” dated July 19, 2004, from HSBC, appointing WELLS FARGO BANK, N.A. as its attorney-in-fact to perform various enumerated services, by executing documents “if such documents are required or permitted under the terms of the related servicing agreements . . . in connection with Wells Fargo Bank, N.A.[‘s] . . . responsibilities to service certain mortgage loans . . . held by HSBC . . . as Trustee of various trusts.” The “Limited Power of Attorney” failed to list any of these “certain mortgage loans.” The Court was unable to determine if plaintiff HSBC’s subject mortgage loan was covered by this “Limited Power of Attorney.” The original motion stated that defendant YEASMIN defaulted on her mortgage payments by failing to make her May 1, 2007 and subsequent monthly loan payments. Yet, on September 10, 2007, 133 days subsequent to defendant YEASMIN’S alleged May 1, 2007 payment default, plaintiff HSBC took the ssignment of the instant nonperforming loan from MERS, as nominee for CAMBRIDGE. Thus, the Court required, upon renewal of the motion for an order of reference, a satisfactory explanation of why HSBC purchased a nonperforming loan from MERS, as nominee for CAMBRIDGE.

Plaintiff HSBC needed “standing” to proceed in the instant action. The Court of Appeals (Saratoga County Chamber of Commerce, Inc. v Pataki, 100 NY2d 801, 912 [2003]), cert denied 540 US 1017 [2003]), held that “[s]tanding to sue is critical to the proper functioning of the judicial system. It is a threshold issue. If standing is denied, the pathway to the courthouse is blocked. The plaintiff who has standing, however, may cross the threshold and seek judicial redress.” In Carper v Nussbaum, 36 AD3d 176, 181 (2d Dept 2006), the Court held that “[s]tanding to sue requires an interest in the claim at issue in the lawsuit that the law will recognize as a sufficient predicate for determining the issue at the litigant’s request.” If a plaintiff lacks standing to sue, the plaintiff may not proceed in the action. (Stark v Goldberg,297 AD2d 203 [1d Dept 2002]). “Since standing is jurisdictional and goes to a court’s authority to resolve litigation [the court] can raise this matter sua sponte.” (Axelrod v New York State Teachers’ Retirement System, 154 AD2d 827, 828 [3d Dept 1989]).

In the instant action, the September 10, 2007 assignment from MERS, as nominee for CAMBRIDGE, to HSBC was defective. Therefore, HSBC had no standing to bring this action. The recorded assignment by “Nicole Gazzo, Esq. on behalf of MERS, by Corporate Resolution dated 7/19/07,” had neither the corporate resolution nor a power of attorney attached. Real Property Law (RPL) § 254 (9) states: Power of attorney to assignee. The word “assign” or other words of assignment, when contained in an assignment of a mortgage and bond or mortgage and note, must be construed as having included in their meaning that the assignor does thereby make, constitute and appoint the assignee the true and lawful attorney, irrevocable, of the assignor, in the name of the assignor, or otherwise, but at the proper costs and charges of the assignee, to have, use and take all lawful ways and means for the recovery of the money and interest secured by the said mortgage and bond or mortgage and note, and in case of payment to discharge the same as fully as the assignor might or could do if the assignment were not made. [Emphasis added]

To have a proper assignment of a mortgage by an authorized agent, a power of attorney is necessary to demonstrate how the agent is vested with the authority to assign the mortgage. “No special form or language is necessary to effect an assignment as long as the language shows the intention of the owner of a right to transfer it [Emphasis added].” (Tawil v Finkelstein Bruckman Wohl Most & Rothman, 223 AD2d 52, 55 [1d Dept 1996]). (See Suraleb, Inc. v International Trade Club, Inc., 13 AD3d 612 [2d Dept 2004]). To foreclose on a mortgage, a party must have title to the mortgage. The instant assignment was a nullity. The Appellate Division, Second Department (Kluge v Fugazy, 145 AD2d 537, 538 [2d Dept 1988]), held that a “foreclosure of a mortgage may not be brought by one who has no title to it and absent transfer of the debt, the assignment of the mortgage is a nullity.” Citing Kluge v Fugazy, the Court inKatz v East-Ville Realty Co. (249 AD2d 243 [1d Dept 1998]), held that “[p]laintiff’s attempt to foreclose upon a mortgage in which he had no legal or equitable interest was without foundation in law or fact.” Plaintiff HSBC, with the invalid assignment of the instant mortgage and note from MERS, lacked standing to foreclose on the instant mortgage. The Court, in Campaign v Barba (23 AD3d 327 [2d Dept 2005]), held that “[t]o establish a prima facie case in an action to foreclose a mortgage, the plaintiff must establish the existence of the mortgage and the mortgage note, ownership of the mortgage, and the defendant’s default in payment [Emphasis added].” (See Household Finance Realty Corp. of New York v Wynn, 19 AD3d 545 [2d Dept 2005]; Sears Mortgage Corp. v Yahhobi, 19 AD3d 402 [2d Dept 2005]; Ocwen Federal Bank FSB v Miller, 18 AD3d 527 [2d Dept 2005]; U.S. Bank Trust Nat. Ass’n v Butti, 16 AD3d 408 [2d Dept 2005]; First Union Mortgage Corp. v Fern, 298 AD2d 490 [2d Dept 2002]; Village Bank v Wild Oaks Holding, Inc., 196 AD2d 812 [2d Dept 1993]). Even if plaintiff HSBC can cure the assignment defect, plaintiff’s counsel has to address his conflict of interest in the representation of both assignor MERS, as nominee for CAMBRIDGE, and assignee HSBC. 22 NYCRR § 1200.24, of the Disciplinary Rules of the Code of Professional Responsibility, entitled “Conflict of Interest; Simultaneous Representation,” states in relevant part: (a) A lawyer shall decline proffered employment if the exercise of independent professional judgment in behalf of a client will be or is likely to be adversely affected by the acceptance of the proffered employment, or if it would be likely to involve the lawyer in representing differing interests, except to the extent permitted under subdivision (c) of this section. (b) A lawyer shall not continue multiple employment if the exercise of independent professional judgment in behalf of a client will be or is likely to be adversely affected by the lawyer’s representation of another client, or if it would be likely to involve the lawyer in representing differing interests, except to the extent permitted under subdivision (c) of this section. (c) in the situations covered by subdivisions (a) and (b) of this section, a lawyer may represent multiple clients if a disinterested lawyer would believe that the lawyer can competently represent the interest of each and if each consents to the representation after full disclosure of the implications of the simultaneous representation and the advantages and risks involved. [Emphasis added]

The Court, upon renewal of the instant motion for an order of reference wanted to know if both MERS and HSBC were aware of the simultaneous representation by plaintiff’s counsel, Steven J. Baum, P.C., and whether both MERS and HSBC consented. Upon plaintiff’s renewed motion for an order of reference, the Court required an affirmation by Steven J. Baum, Esq., the principal of Steven J. Baum, P.C., explaining if both MERS and HSBC consented to simultaneous representation in the instant action with “full disclosure of the implications of the simultaneous representation and the advantages and risks involved.” The Appellate Division, Fourth Department, the Department, in which both Ms. Gazzo and Mr. Baum are registered (In re Rogoff, 31 AD3d 111 [2006]), censured an attorney for, inter alia, violating 22 NYCRR § 1200.24, by representing both a buyer and sellers in the sale of a motel. The Court, at 112, found that the attorney “failed to make appropriate disclosures to either the sellers or the buyer concerning dual representation.” Further, the Rogoff Court, at 113, censured the attorney, after it considered the matters submitted by respondent in mitigation, including: that respondent undertook the dual representation at the insistence of the buyer, had no financial interest in the transaction and charged the sellers and the buyer one half of his usual fee. Additionally, we note that respondent cooperated with the Grievance Committee and has expressed remorse for his misconduct. Then, if counsel for plaintiff HSBC cures the assignment defect and explains his simultaneous representation, plaintiff HSBC needs to address the “affidavit of merit” issue. The May 2, 2008 decision and order required that plaintiff comply with CPLR § 3215 (f) by providing an “affidavit made by the party,” whether by an officer of HSBC, or someone with a valid power of attorney from HSBC, to execute foreclosure documents for plaintiff HSBC. If plaintiff HSBC presents a power of attorney and it refers to a servicing agreement, the Court needs to inspect the servicing agreement. (Finnegan v Sheahan, 269 AD2d 491 [2d Dept 2000];Hazim v Winter, 234 AD2d 422 [2d Dept 1996]; EMC Mortg. Corp. v Batista, 15 Misc 3d 1143 [A] [Sup Ct, Kings County 2007]; Deutsche Bank Nat. Trust Co. v Lewis, 4 Misc 3d 1201 [A] [Sup Ct, Suffolk County 2006]).

Last, the Court required an affidavit from an officer of HSBC, explaining why, in the middle of our national mortgage financial crisis, plaintiff HSBC purchased from MERS, as nominee for CAMBRIDGE, the subject nonperforming loan. It appears that HSBC violated its corporate fiduciary duty to its stockholders by purchasing the instant mortgage loan, which became nonperforming on May 1, 2007, 133 days prior to its assignment from MERS, as nominee for CAMBRIDGE, to HSBC, rather than keep the subject mortgage loan on CAMBRIDGE’s books.

Discussion

The instant renewed motion is dismissed for untimeliness. Plaintiff made its renewed motion for an order of reference 204 days late, in violation of the Court’s May 2, 2008 decision and order. Moreover, even if the instant motion was timely, the explanations offered by plaintiff’s counsel, in his affirmation in support of the instant motion and various documents attached to exhibit F of the instant motion, attempting to cure the four defects explained by the Court in the prior May 2, 2008 decision and order, are so incredible, outrageous, ludicrous and disingenuous that they should have been authored by the late Rod Serling, creator of the famous science-fiction televison series, The Twilight Zone. Plaintiff’s counsel, Steven J. Baum, P.C., appears to be operating in a parallel mortgage universe, unrelated to the real universe. Rod Serling’s opening narration, to episodes in the 1961-1962 season of The Twilight Zone (found at www.imdb.com/title/tt005250/quotes), could have been an introduction to the arguments presented in support of the instant motion by plaintiff’s counsel, Steven J. Baum, P.C. — “You are traveling through another dimension, a dimension not only of sight and sound but of mind. A journey into a wondrous land of imagination. Next stop, the Twilight Zone.” With respect to the first issue for the renewed motion for an order of reference, the validity of the September 10, 2007 assignment of the subject mortgage and note by MERS, as nominee for CAMBRIDGE, to plaintiff HSBC by “Nicole Gazzo, Esq., on behalf of MERS, by Corporate Resolution dated 7/19/07,” plaintiff’s counsel claims that the assignment is valid because Ms. Gazzo is an officer of MERS, not an agent of MERS. Putting aside Ms. Gazzo’s conflicted status as both assignor attorney and employee of assignee’s counsel, Steven J. Baum, P.C., how would the Court have known from the plain language of the September 10, 2007 assignment that the assignor, Ms. Gazzo, is an officer of MERS? She does not state in the assignment that she is an officer of MERS and the corporate resolution is not attached. Thus, counsel’s claim of a valid assignment takes the Court into “another dimension” with a “journey into a wondrous land of imagination,” the mortgage twilight zone. Next, plaintiff’s counsel attached to exhibit F the July 17, 2007 “Agreement for Signing Authority” between MERS, Wells Fargo Home Mortgage, a Division of Wells Fargo Bank NA (WELLS FARGO), a MERS “Member” and Steven J. Baum, P.C., as WELLS FARGO’s “Vendor.” The parties agreed, in ¶ 3, that “in order for Vendor [Baum] to perform its contractual duties to Member [WELLS FARGO], MERS, by corporate resolution, will grant employees of Vendor [Baum] the limited authority to act on behalf of MERS to perform certain duties. Such authority is set forth in the Resolution, which is made a part of this Agreement.” Also attached to exhibit F is the MERS corporate resolution, certified by William C. Hultman, Corporate Secretary of MERS, that MERS’ Board of Directors adopted this resolution, effective July 19, 2007, resolving:

that the attached list of candidates are employee(s) of Steven J. Baum, P.C. and are hereby appointed as assistant secretaries and vice presidents of Mortgage Electronic Registration Systems, Inc., and as such are authorized to: Execute any and all documents necessary to foreclose upon the property securing any mortgage loan registered on the MERS System that is shown to be registered to the Member . . . Take any and all actions and execute all documents necessary to protect the interest of the Member, the beneficial owner of such mortgage loan, or MERS in any bankruptcy proceedings . . . Assign the lien of any mortgage loan registered on the MERS System that is shown to be registered to Wells Fargo.

Then, the resolution certifies five Steven J. Baum, P.C. employees [all currently admitted to practice in New York and listing Steven J. Baum, P.C. as their employer in the Office of Court Administration Attorney Registry] as MERS officers. The five are Brian Kumiega, Nicole Gazzo, Ron Zackem, Elpiniki Bechakas, and Darleen Karaszewski. The language of the MERS corporate resolution flies in the face of documents recorded with the City Register of the City of New York. The filed recordings with the City Register show that the subject mortgage was owned first by MERS, as nominee for CAMBRIDGE, and then by HSBC as Trustee for a Nomura collateralized debt obligation. However, if the Court follows the MERS’corporate resolution and enters into a new dimension of the mind, the mortgage twilight zone, the real owner of the subject mortgage is WELLS FARGO, the MERS Member and loan servicer of the subject mortgage, because the corporate resolution states that the Member is “the beneficial owner of such mortgage loan.” The MERS mortgage twilight zone was created in 1993 by several large “participants in the real estate mortgage industry to track ownership interests in residential mortgages. Mortgage lenders and other entities, known as MERS members, subscribe to the MERS system and pay annual fees for the electronic processing and tracking of ownership and transfers of mortgages. Members contractually agree to appoint MERS to act as their common agent on all mortgages they register in the MERS system.” (MERSCORP, Inc. v Romaine, 8 NY3d 90, 96 [2006]). Next, with respect to Ms. Gazzo’s employer, Steven J. Baum, P.C, and its representation of MERS, through Ms. Gazzo, the Court continues to journey through the mortgage twilight zone. Also, attached to exhibit F of the instant motion is the August 11, 2008 affirmation of Steven J. Baum, Esq., affirmed “under the penalties of perjury.” Mr. Baum states, in ¶ 3, that “My firm does not represent HSBC . . . and MERS simultaneously in the instant action.” Then, apparently overlooking that the subject notice of pendency, summons, complaint and instant motion, which all clearly state that Steven J. Baum, P.C. is the attorney for plaintiff HSBC, Mr. Baum states, in ¶ 4 of his affirmation, that “My firm is the attorney of record for Wells Fargo Bank, N.A., d/b/a America’s Servicing Company, attorney in fact for HSBC Bank USA, N.A., as Trustee for Nomura Asset-Backed Certificate Series 2006-AF1. My firm does not represent . . . [MERS] as an attorney in this action.” In the mortgage world according to Steven J. Baum, Esq., there is a fine line between acting as an attorney for MERS and as a vendor for a MERS member. If Mr. Baum is not HSBC’s attorney, but the attorney for WELLS FARGO, why did he mislead the Court and defendants by stating on all the documents filed and served in the instant action that he is plaintiff’s attorney for HSBC? Further, in ¶ 6 of his affirmation, he states “Nowhere does the Resolution indicate that Ms. Gazzo, or my firm, or any attorney or employee of my firm, shall act as an attorney for MERS. As such I am unaware of any conflict of interest of Steven J. Baum, P.C. or any of its employees, in this action.” While Mr. Baum claims to be unaware of the inherent conflict of interest, the Court is aware of the conflict. ¶ 3 of the MERS “Agreement for Signing Authority,” cited above, states that “in order for Vendor [Baum] to perform its contractual duties to Member [WELLS FARGO], MERS, by corporate resolution, will grant employees of Vendor [Baum] the limited authority to act on behalf of MERS to perform certain duties. Such authority is set forth in the Resolution, which is made a part of this Agreement.” As the Court continues through the MERS mortgage twilight zone, attached to exhibit F is the June 30, 2009-affidavit of MERS’ Secretary, William C. Hultman. Mr. Hultman claims, in ¶ 3, that Steven J. Baum, P.C. is not acting in the instant action as attorney for MERS and, in ¶ 4, Ms. Gazzo in her capacity as an officer of MERS executed the September 10, 2007 subject assignment “to foreclose on a mortgage loan registered on the MERS System that is being serviced by Wells Fargo Bank, N.A.” Thus, Mr. Hultman perceives that mortgages registered on the MERS system exist in a parallel universe to those recorded with the City Register of the City of New York. While Mr. Hultman waives, in ¶ 9, any conflict that might exist by Steven J. Baum, P.C. in the instant action, neither he nor Mr. Baum address whether MERS, pursuant to 22 NYCRR § 1200.24, consented to simultaneous representation in the instant action, with “full disclosure of the implications of the simultaneous representation and the advantages and risks involved” explained to MERS. Then, attached to exhibit F, there is the June 11, 2008-affidavit of China Brown, Vice President Loan Documentation of WELLS FARGO. This document continues the Court’s trip into “a wondrous land of imagination.” Despite the affidavit’s caption stating that HSBC is the plaintiff, Mr. or Ms. Brown (the notary public’s jurat refers several times to China Brown as “he/she”), states, in ¶ 4, that “Steven J. Baum, P.C. represents us as an attorney of record in this action.” The Court infers that “us” is WELLS FARGO. Moving to the third issue that plaintiff was required to address in the instant motion, compliance with the statutory requirements of CPLR § 3215 (f) with an affidavit of facts executed by someone with authority to execute such an affidavit, plaintiff’s instant motion contains an affidavit of merit, attached as exhibit C, by Kim Miller, “Vice President of Wells Fargo Bank, N.A. as Attorney in Fact for HSBC,” executed on December 8, 2008, 220 days after my May 2, 2008 decision and order. The affidavit of merit is almost six months late. Again, plaintiff attached a photocopy of the July 19, 2004 “Limited Power of Attorney” from HSBC [exhibit D], which appointed WELLS FARGO as its attorney-in-fact to perform various enumerated services, by executing documents “if such documents are required or permitted under the terms of the related servicing agreements . . . in connection with Wells Fargo[‘s] . . . responsibilities to service certain mortgage loans . . . held by HSBC . . . as Trustee of various trusts.” Further, the “Limited Power of Attorney” fails to list any of these “certain mortgage loans.” Therefore, the Court is unable to determine if the subject mortgage loan is one of the mortgage loans that WELLS FARGO services for HSBC. The “Limited Power of attorney” gives WELLS FARGO the right to execute foreclosure documents “if such documents are required or permitted under the terms of the related servicing agreements.” Instead of presenting the Court with the “related servicing agreement” for review, plaintiff’s counsel submits copies of the cover page and redacted pages 102, 104 and 105 of the October 1, 2006 Pooling and Servicing Agreement between WELLS FARGO, as Master Servicer, HSBC, as Trustee, and other entities. This is in direct contravention of the Court’s May 2, 2008-directive to plaintiff HSBC that it provides the Court with the entire pooling and servicing agreement upon renewal of the instant motion. Thomas Westmoreland, Vice President Loan Documentation of HSBC, in ¶ 10 of his attached June 13, 2008-affidavit, also in exhibit F, claims that the snippets of the pooling and servicing agreement provided to the Court are “a copy of the non-proprietary portions of the Pooling and Servicing Agreement that was entered into when the pool of loans that contained the subject mortgage was purchased.” The Court cannot believe that there is any proprietary or trade secret information in a boilerplate pooling and servicing agreement. If plaintiff HSBC utilizes an affidavit of facts by a loan servicer, not an HSBC officer, to secure a judgment on default, pursuant to CPLR § 3215 (f), then the Court needs to examine the entire pooling and servicing agreement, whether proprietary or non-p

roprietary, to determine if the pooling and servicing agreement grants authority, pursuant to a power of attorney, to the affiant to execute the affidavit of facts.

Further, there is hope that Mr. Westmoreland, unlike Steven J. Baum, Esq., is not in another dimension. Mr. Westmoreland, in ¶ 1 of his affidavit, admits that HSBC is the plaintiff in this action. However, with respect to why plaintiff HSBC purchased the subject nonperforming loan, Mr. Westmoreland admits to a lack of due diligence by plaintiff HSBC. His admissions are straight from the mortgage twilight zone. He states in his affidavit, in ¶’s 4-7 and part of ¶ 10: 4. The secondary mortgage market is, essentially, the buying and selling of “pools” of mortgages. 5. A mortgage pools is the packaging of numerous mortgage loans together so that an investor may purchase a significant number of loans in one transaction. 6. An investigation of each and every loan included in a particular mortgage pool, however, is not conducted, nor is it feasible. 7. Rather, the fact that a particular mortgage pool may include loans that are already in default is an ordinary risk of participating in the secondary market . . . 10. . . . Indeed, the performance of the mortgage pool is the measure of success, not any one individual loan contained therein. [Emphasis added] The Court can only wonder if this journey through the mortgage twilight zone and the dissemination of this decision will result in Mr. Westmoreland’s affidavit used as evidence in future stockholder derivative actions against plaintiff HSBC. It can’t be comforting to investors to know that an officer of a financial behemoth such as plaintiff HSBC admits that “[a]n investigation of each and every loan included in a particular mortgage pool, however, is not conducted, nor is it feasible” and that “the fact that a particular mortgage pool may include loans that are already in default is an ordinary risk of participating in the secondary market.”

Cancelling of notice of pendency

The dismissal with prejudice of the instant foreclosure action requires the cancellation of the notice of pendency. CPLR § 6501 provides that the filing of a notice of pendency against a property is to give constructive notice to any purchaser of real property or encumbrancer against real property of an action that “would affect the title to, or the possession, use or enjoyment of real property, except in a summary proceeding brought to recover the possession of real property.” The Court of Appeals, in 5308 Realty Corp. v O & Y Equity Corp. (64 NY2d 313, 319 [1984]), commented that “[t]he purpose of the doctrine was to assure that a court retained its ability to effect justice by preserving its power over the property, regardless of whether a purchaser had any notice of the pending suit,” and, at 320, that “the statutory scheme permits a party to effectively retard the alienability of real property without any prior judicial review.” CPLR § 6514 (a) provides for the mandatory cancellation of a notice of pendency by: The Court, upon motion of any person aggrieved and upon such notice as it may require, shall direct any county clerk to cancel a notice of pendency, if service of a summons has not been completed within the time limited by section 6512; or if the action has beensettled, discontinued or abated; or if the time to appeal from a final judgment against the plaintiff has expired; or if enforcement of a final judgment against the plaintiff has not been stayed pursuant to section 551. [emphasis added] The plain meaning of the word “abated,” as used in CPLR § 6514 (a) is the ending of an action. “Abatement” is defined (Black’s Law Dictionary 3 [7th ed 1999]) as “the act of eliminating or nullifying.” “An action which has been abated is dead, and any further enforcement of the cause of action requires the bringing of a new action, provided that a cause of action remains (2A Carmody-Wait 2d § 11.1).” (Nastasi v Natassi, 26 AD3d 32, 40 [2d Dept 2005]). Further, Nastasi at 36, held that the “[c]ancellation of a notice of pendency can be granted in the exercise of the inherent power of the court where its filing fails to comply with CPLR § 6501 (see 5303 Realty Corp. v O & Y Equity Corp., supra at 320-321; Rose v Montt Assets, 250 AD2d 451, 451-452 [1d Dept 1998]; Siegel, NY Prac § 336 [4th ed]).” Thus, the dismissal of the instant complaint must result in the mandatory cancellation of plaintiff HSBC’s notice of pendency against the property “in the exercise of the inherent power of the court.”

Conclusion

Accordingly, it is ORDERED, that the renewed motion of plaintiff, HSBC BANK USA, N.A. AS TRUSTEE FOR NOMURA ASSET-BACKED CERTIFICATE SERIES 2006-AF1, for an order of reference, for the premises located at 22 Jefferson Street, Brooklyn, New York (Block 3170, Lot 20, County of Kings), is denied with prejudice; and it is further

ORDERED, that the instant action, Index Number 34142/07, is dismissed with prejudice; and it is further

ORDERED that the Notice of Pendency in this action, filed with the Kings County Clerk on September 10, 2007, by plaintiff, HSBC BANK USA, N.A. AS TRUSTEE FOR NOMURA ASSET-BACKED CERTIFICATE SERIES 2006-AF1, to foreclose a mortgage for real property located at 22 Jefferson Street, Brooklyn New York (Block 3170, Lot 20, County of Kings), is cancelled.

This constitutes the Decision and Order of the Court.

Via: FRAUD DIGEST

The trial court opinion was published in the New York Law Journal.

KINGS COUNTY
Real Property
Bank Fails to Rebut Satisfaction’s Validity Created By Notary’s Acknowledgment; Foreclosure Denied

Wells Fargo Bank NA v. Moise

Defendants seek summary judgment based on the fact that Plaintiff has not shown a valid assignment of the mortgage and note.

Plaintiff originally submitted an assignment of the mortgage dated April 30, 2009. The assignment was signed by Yolanda Williams, Assistant Secretary of Mortgage Electronic Systems, Inc..  However, the notary public’s acknowledgement states that she witnessed and acknowledged the signature of Herman John Kennerty, whose name does not appear anywhere on the document.

Plaintiff acknowledges that there was a mistake on the assignment and argues the mistake was de minimis not curat lex.  It also argues that the Court should simply replace the defective assignment with the correction assignment, and proceed with its action.  In fact, the error was not de minimis as the signature of the purported assignor was not acknowledged, rendering the assignment a nullity.

A simple typographical error can be amended, but a failure to properly acknowledge the signature of a person who signed the instrument cannot be. No affidavit is submitted either Yolanda Williams or the notary Lisa Rhyne explaining what the alleged error was or how it occurred. In fact, the so called “correction” assignment in fact is acknowledged by a different notary on a different date.

Folks there is just way too many. Eventually this will all be released.

Every Foreclosure/REO/Short Sale out there is virtually like this!

via ForeclosureHamlet.org & 4closurefraud.org

The attached documents are almost always the sole “evidence” showing the right of a foreclosing entity/servicer (or their shell National Bank Cover ie: US Bank) to foreclose on an American family’s home, evicting them from the only shelter that may be available to them.

Millions of examples of this and other “robo-signers” available upon request.

Of note, please see the last attachment; her deposition where she denies any “personal knowledge” or even a cursory glance at the facts of the case.

America………..what a heartache……….

ANOTHER POINT IS THEY seem to be different signatures. Some have loops and some do not.

DEPOSITION_OF_BETH-COTTRELL-CHASE-HOME-FINANCE

In re: SIMEON MORENO, Chapter 13, Debtor

Case No. 08-17715-FJB.

United States Bankruptcy Court, D. Massachusetts, Eastern Division.

May 24, 2010.

MEMORANDUM OF DECISION ON MOTION OF PROPERTY ASSET MANAGEMENT, INC. FOR RELIEF FROM THE AUTOMATIC STAY

FRANK J. BAILEY, Bankruptcy Judge

In the Chapter 13 case of debtor Simeon Moreno, Property Asset Management, Inc. (“PAM”), claiming to be the assignee of a mortgage originally given by the debtor to Mortgage Electronic Registration Systems, Inc. (“MERS”) as nominee for lender GE Money Bank, moved for relief from the automatic stay to foreclose the mortgage. Moreno initially opposed the motion but then withdrew his objection, whereupon the Court granted the relief requested. Months later, at Moreno’s request, the Court vacated the order granting relief from stay and scheduled an evidentiary hearing on the Motion for Relief from Stay for the limited purpose of reconsidering whether PAM had an interest in the mortgage it sought to foreclose and, to that extent, standing to seek relief from stay.^[1] Having held the evidentiary hearing and received proposed findings and conclusions, the Court now enters the following findings of fact and conclusions of law.

Findings of Fact and Procedural History

On January 23, 2007, Moreno executed a promissory note in the principal amount of $492,000, payable to lender GE Money Bank. GE subsequently endorsed the note in blank, whereupon possession of the note was transferred through a series of holders and ultimately to Lehman Brothers Holdings, Inc. (“LBHI”), who held the note when PAM filed its Motion for Relief from Stay and continues to hold it now.^[2] LBHI, through one of its employees and through LBHI’s attorney, who not coincidentally also is PAM’s attorney in the present matter, produced the original note at the evidentiary hearing. PAM is not now a holder of the note or an entity for whose benefit another has held the note.

To secure the promissory note, Moreno gave a mortgage on the real property at 5 Maple Street, West Roxbury, Massachusetts (the “Property”) to MERS as nominee for GE (the “Mortgage”). The Mortgage specifies that MERS “is a separate corporation that is acting solely as a nominee for [GE] and [GE’s] successors and assigns. MERS is the mortgagee under this security instrument.” The Mortgage further provides that Moreno does hereby mortgage, grant and convey to MERS (solely as nominee for [GE] and [GE’s] successors and assigns) and to the successors and assigns of MERS, with power of sale, the [Property]. . . . Borrower understands and agrees that MERS holds only legal title to the interests granted by Borrower in this Security Instrument, but, if necessary to comply with law or custom, MERS (as nominee for [GE] and [GE’s] successors and assigns) has the right: to exercise any or all of those interests, including, but not limited to, the right to foreclose and sell the Property; and to take any action required of [GE] including, but not limited to, releasing and canceling this Security Instrument.

The Mortgage was duly recorded.

MERS administers an electronic registry to track the transfer of ownership interest and servicing rights in mortgage loans. With respect to certain loans of which its members are the beneficial owners, MERS also serves as mortgagee of record and holds legal title to the mortgages in a nominee capacity. MERS remains the mortgagee of record when beneficial ownership interests or servicing rights are sold from one member of the MERS system to another. When the beneficial interest in a mortgage loan is transferred from one member of the MERS system to another, MERS tracks the transfer through its internal records. When rights are transferred from a member of the MERS system to a non-member, MERS executes and records an assignment from MERS to the non-member.

To facilitate the execution of the assignments from MERS, MERS designates “certifying officers,” who are typically employees of MERS member firms. MERS authorizes these employees, through formal corporate resolutions, to execute assignments on behalf of MERS. On or about January 6, 2005, MERS, through a document entitled Corporate Resolution and issued by its board of directors, authorized Denise Bailey, an employee of Litton Loan Servicing L.P. (“Litton”), a member of MERS, to execute such assignments on behalf of MERS. In the language of the authorizing document (the “MERS Authorization”),^[3] Ms. Bailey was authorized to, among other things, “assign the lien of any mortgage loan naming MERS as the mortgagee when the Member [Litton] is also the current promissory note-holder, or if the mortgage loan is registered on the MERS System, is shown [sic] to be registered to the Member”^[4]; and Ms. Bailey was further authorized to “take any such actions and execute such documents as may be necessary to fulfill the Member’s servicing obligations to the beneficial owner of such mortgage loan (including mortgage loans that are removed from the MERS System as a result of the transfer thereof to a non-member of MERS).” In each instance, Bailey’s authority to act is dependent on the existence of a specified relationship of Litton, the MERS member for whom she is employed, to the loan in question.

The Moreno loan was entered into the MERS tracking database in the ordinary course of business. Thereafter, MERS tracked the beneficial interest in the loan. The beneficial interest was transferred from G.E. Money Bank to WMC Mortgage Corporation; then, on September 19, 2007, from WMC Mortgage Corporation to Aurora Bank FSB (formerly known as Lehman Brothers Bank FSB), and then, on July 30, 2008, from Aurora Bank FSB to LBHI. Aurora Bank was at all relevant times a wholly-owned subsidiary of LBHI.

With respect to the Moreno Mortgage, MERS remained the mortgagee of record until, on or about April 30, 2008, MERS, acting through Denise Bailey, assigned the Mortgage to PAM. At the time, Aurora Bank FSB was the beneficial owner of the loan. In executing the MERS assignment to PAM, Ms. Bailey purported to be acting under her MERS Authorization.

The MERS Authorization limited Ms. Bailey’s authority to act for MERS to matters with respect to which Litton was involved in at least one of the ways specified in the above-quoted language from the MERS Authorization. There is evidence, and I find, that Aurora Bank FSB had requested that Litton transfer the loan from MERS to PAM in anticipation of foreclosure. However, PAM has adduced no evidence that Litton had any specified connection to this loan at the time it executed this assignment. There is no evidence that Litton was then (or at any time) the servicer of the loan for Aurora Bank or that Litton was registered as servicer of the loan in the MERS system.^[5] (PAM does not contend that Litton was the holder of the promissory note or the owner of the beneficial interest in the loan.)

Scott Drosdick, a vice-president of LBHI and witness for PAM at the evidentiary hearing, testified that Aurora Bank’s instruction to Litton to transfer the mortgage to PAM was later “ratified by LBHI.” Drosdick did not explain what he meant by this, precisely how and when this ratification occurred. Absent such evidence and clarification, this testimony is too vague to have any definite meaning; accordingly I give it no weight.

By a master servicing agreement dated February 1, 1999, LBHI engaged Aurora Loan Services, Inc., now known as Aurora Loan Services LLC (“ALS”), as master servicer of certain loans, including eventually the present Moreno loan. In turn, ALS engaged Litton to service certain loans, including eventually this same loan.

After Bailey executed the MERS assignment to PAM, Bailey executed another assignment of the same mortgage from MERS to LBHI. This second assignment was never recorded; nor is there evidence that it was ever delivered by MERS to LBHI.

Moreno filed a petition for relief under Chapter 13 of the Bankruptcy Code on October 13, 2008, commencing the present bankruptcy case. On November 13, 2008, LBHI, acting through its servicer Litton Loan Servicing, LP, filed a proof of claim in this case; the proof of claim asserts a claim, secured by real estate, in the total amount of $530,168.04, the same secured claim as PAM now seeks relief from stay to enforce by foreclosure. On the proof of claim form itself, Litton actually identifies the creditor claimant as simply “Litton,” but on an explanatory document attached to the proof of claim form, Litton states that the claim is filed by “Litton Loan Servicing, LP, as Servicing Agent for Lehman Brothers Holdings Inc.” The proof of claim does not mention PAM or indicate in any way that the mortgage securing the claim is held by anyone other than LBHI.

On March 31, 2009, and at LBHI’s direction, PAM filed the present motion for relief from the automatic stay, seeking relief from the automatic stay to foreclose and to preserve its rights as to a potential deficiency. PAM intends and is obligated to remit the proceeds of the intended foreclosure sale to Aurora Loan Services LLC, as servicer for LBHI. Regarding ownership of the note and Mortgage, PAM stated in the motion only that it was the holder of a mortgage originally given by Moreno to MERS, that the mortgage secured a note given by Moreno to GE, and that MERS had assigned the mortgage to PAM. PAM did not indicate that LBHI was the current holder of the note or that it held the mortgage as nominee for the benefit of LBHI or of any other entity. The motion did not mention LBHI.

Moreno filed a response to the motion, in essence an objection, in which he expressly admitted PAM’s allegation that his prepetition arrearage was $39,442.49 and, by lack of denial, tacitly admitted that Moreno was some four months in arrears on his postpetition payments under the mortgage. By these allegations and admissions, PAM has established that Moreno is in default on his mortgage loan obligations; the Court rejects Moreno’s request for a finding that PAM has not established a default. The response made no issue of PAM’s standing to foreclose or to seek relief from stay and did not dispute PAM’s allegations regarding ownership of the note and Mortgage. In any event, before a hearing was held on the motion, Moreno, through counsel, withdrew his objection. Consequently, on April 28, 2009, and without a hearing or any review of apparent inconsistencies in the bankruptcy record concerning ownership of the mortgage and note, the court granted PAM relief from the automatic stay to foreclose and to preserve its rights as to a potential deficiency.

PAM had not yet foreclosed when, on December 2, 2009 and by new counsel, Moreno filed an adversary complaint against PAM and, with it, a motion for preliminary injunction. The complaint sought among other things (i) an order invalidating the mortgage on account of irregularities in its origination and (ii) a declaration that PAM was not the holder of the mortgage and note. In the motion for preliminary injunction, Moreno asked that the foreclosure be stayed, or that the automatic stay be reimposed, pending disposition of the adversary proceeding. On December 7, 2009, after a hearing on the motion for preliminary injunction, the Court found that the motion was, in part, essentially one to vacate the order granting relief from the automatic stay, vacated that order, and scheduled an evidentiary hearing on the motion for relief. The order specified that the sole issue at the evidentiary hearing would be PAM’s standing to seek relief from the automatic stay, all other issues under 11 U.S.C. § 362(d) being deemed established. After discovery, the evidentiary hearing was held on April 8, 2010, and, with the submission of proposed findings and conclusions, the matter was then taken under advisement.

Discussion

As the party seeking relief from stay to foreclose a mortgage on the debtor’s property, PAM bears the burden of proving that it has authority under applicable state law to foreclose the mortgage in question and, by virtue of that authority, standing to move for relief from the automatic stay to foreclose. PAM contends that it has such authority and standing because, although it does not hold the promissory note that the mortgage secures, it does have title to the mortgage itself; and it holds that title as nominee of and for the benefit of the note holder, LBHI, and is foreclosing for LBHI. In these circumstances, PAM contends, a mortgagee has a right under Massachusetts law to foreclose for the benefit of the note holder and therefore standing to move for relief from stay to foreclose. The Debtor objects, arguing (among other things) that Massachusetts law prohibits foreclosure by one who holds only the mortgage and not the note it secures. I need not address the merits of this and other objections because, even if the theory is a valid one, it requires proof that PAM is the present title holder of the mortgage, and PAM has not carried its burden in this regard.

To show that it presently holds the mortgage, PAM must show a valid assignment of the mortgage from MERS to itself. PAM contends that it holds the mortgage by assignment from MERS. Accordingly, PAM must show that the assignment, which was executed for MERS by Denise Bailey, was within the scope of Bailey’s limited authority to act for MERS.

Ms. Bailey’s authority to act for MERS is defined in the MERS Authorization in seven enumerated paragraphs. In each, Ms. Bailey’s authority to act is dependent on the existence of a specified relationship of Litton, the MERS member by whom she is employed, to the loan in question. PAM has submitted no evidence of the existence of any such relationship. The beneficial owner of the loan at the time of the assignment was Aurora Bank FSB, but there is no evidence that Litton was at the time the servicer of the loan for Aurora Bank FSB or was registered with MERS as such. The Court does not find that Aurora Bank FSB had not retained Litton as its servicer; there is simply no evidence on the issue. But the burden is on PAM to prove that it had, and PAM has not adduced evidence to that effect.

Accordingly, by a separate order, the Court will deny PAM’s motion for relief from the automatic stay without prejudice to renewal upon proper proof.

[1] All other issues were resolved upon entry of the original order granting relief from stay. No cause has been adduced to revisit any but the narrow issue of standing.

[2] Moreno contends that LBHI, which is in bankruptcy proceedings of its own, may have sold its interest in the note through a court-approved sale in its bankruptcy case. However, Moreno does not contend that possession of the note has passed from LBHI to the alleged purchaser (or any nominee of the purchaser), and therefore the alleged possible sale is irrelevant, as possession undisputedly remains in LBHI. In any event, Moreno attempted to establish the fact of the alleged sale by designating certain documents on the docket of the LBHI case and asking the Court to take judicial notice of these and then to find them on its own and to determine from them whether the promissory note in question was among the assets transferred. Having found the alleged sale to be irrelevant, the Court declined to take judicial notice of the bankruptcy documents. However, the proffer also failed for two additional reasons: first, that Moreno did not take a position as to whether a sale did occur, only that the Moreno note may have been among those transferred in the sale; and second, even if the court had taken judicial notice as requested, it remained Moreno’s obligation, which he has not fulfilled, to produce the documents in question and to explain in the first instance how one would conclude from them that the asset in question was among those transferred.

[3] MERS Corporate Resolution, attached to Bailey Affidavit as Exhibit 1.

[4] The grammatical difficulty in this second clause is native to the authorizing document.

[5] The original affidavit of Scott Drosdick includes the following two sentences:

By Master Servicing Agreement dated February 1, 1999, LBHI engaged Aurora Bank FSB (f/k/a Lehman Brothers Bank FSB), to master service, among other things, the Loan [the Moreno loan]. In turn, Aurora Bank FSB engaged Litton pursuant to a Flow Subservicing Agreement dated October 1, 2007, to service the loan.”

By an amendment to the affidavit and in testimony, Drosdick later amended his affidavit to correct this passage by striking Aurora Bank FSB from the first sentence and in its place inserting Aurora Loan Services LLC. Drosdick did not expressly change the second sentence, but that sentence, which begins with the critical words “in turn,” would be nonsensical unless the same substitution—Aurora Loan Services LLC for Aurora Bank FSB—were also made in the second sentence. Therefore, though the second sentence might perhaps be read in isolation as evidence that Litton was servicing the loan for Aurora Bank FSB at the time when Bailey executed the assignment, that sentence cannot credibly be so construed.

If other judges knew more of what really is than whats not perhaps they would also know the fraud that is being played in their court rooms.

By MICHAEL POWELL Published: August 30, 2009

The judge waves you into his chambers in the State Supreme Court building in Brooklyn, past the caveat taped to his wall — “Be sure brain in gear before engaging mouth” — and into his inner office, where foreclosure motions are piled high enough to form a minor Alpine chain.

 Nicole Bengiveno/The New York Times

“I don’t want to put a family on the street unless it’s legitimate,” Justice Arthur M. Schack said.

Every week, the nation’s mightiest banks come to his court seeking to take the homes of New Yorkers who cannot pay their mortgages. And nearly as often, the judge says, they file foreclosure papers speckled with errors.

He plucks out one motion and leafs through: a Deutsche Bank representative signed an affidavit claiming to be the vice president of two different banks. His office was in Kansas City, Mo., but the signature was notarized in Texas. And the bank did not even own the mortgage when it began to foreclose on the homeowner.

The judge’s lips pucker as if he had inhaled a pickle; he rejected this one.

“I’m a little guy in Brooklyn who doesn’t belong to their country clubs, what can I tell you?” he says, adding a shrug for punctuation. “I won’t accept their comedy of errors.”

The judge, Arthur M. Schack, 64, fashions himself a judicial Don Quixote, tilting at the phalanxes of bankers, foreclosure facilitators and lawyers who file motions by the bale. While national debate focuses on bank bailouts and federal aid for homeowners that has been slow in coming, the hard reckonings of the foreclosure crisis are being made in courts like his, and Justice Schack’s sympathies are clear.

He has tossed out 46 of the 102 foreclosure motions that have come before him in the last two years. And his often scathing decisions, peppered with allusions to the Croesus-like wealth of bank presidents, have attracted the respectful attention of judges and lawyers from Florida to Ohio to California. At recent judicial conferences in Chicago and Arizona, several panelists praised his rulings as a possible national model.

His opinions, too, have been greeted by a cry of affront from a bank official or two, who say this judge stands in the way of what is rightfully theirs. HSBC bank appealed a recent ruling, saying he had set a “dangerous precedent” by acting as “both judge and jury,” throwing out cases even when homeowners had not responded to foreclosure motions.

Justice Schack, like a handful of state and federal judges, has taken a magnifying glass to the mortgage industry. In the gilded haste of the past decade, bankers handed out millions of mortgages — with terms good, bad and exotically ugly — then repackaged those loans for sale to investors from Connecticut to Singapore. Sloppiness reigned. So many papers have been lost, signatures misplaced and documents dated inaccurately that it is often not clear which bank owns the mortgage.

Justice Schack’s take is straightforward, and sends a tremor through some bank suites: If a bank cannot prove ownership, it cannot foreclose.

“If you are going to take away someone’s house, everything should be legal and correct,” he said. “I’m a strange guy — I don’t want to put a family on the street unless it’s legitimate.”

Justice Schack has small jowls and big black glasses, a thin mustache and not so many hairs combed across his scalp. He has the impish eyes of the high school social studies teacher he once was, aware that something untoward is probably going on at the back of his classroom.

He is Brooklyn born and bred, with a master’s degree in history and an office loaded with autographed baseballs and photographs of the Brooklyn Dodgers. His written decisions are a free-associative trip through popular, legal and literary culture, with a sideways glance at the business pages.

Confronted with a case in which Deutsche Bank and Goldman Sachs passed a defaulted mortgage back and forth and lost track of the documents, the judge made reference to the film classic “It’s a Wonderful Life” and the evil banker played by Lionel Barrymore.

“Lenders should not lose sight,” Justice Schack wrote in that 2007 case, “that they are dealing with humanity, not with Mr. Potter’s ‘rabble’ and ‘cattle.’ Multibillion-dollar corporations must follow the same rules in the foreclosure actions as the local banks,savings and loan associations or credit unions, or else they have become the Mr. Potters of the 21st century.”

Last year, he chastised Wells Fargo for filing error-filled papers. “The court,” the judge wrote, “reminds Wells Fargo of Cassius’s advice to Brutus in Act 1, Scene 2 of William Shakespeare’s ‘Julius Caesar’: ‘The fault, dear Brutus, is not in our stars, but in ourselves.’ ”

Then there is a Deutsche Bank case from 2008, the juicy part of which he reads aloud:

“The court wonders if the instant foreclosure action is a corporate ‘Kansas City Shuffle,’ a complex confidence game,” he reads. “In the 2006 film ‘Lucky Number Slevin,’ Mr. Goodkat, a hit man played by Bruce Willis, explains: ‘A Kansas City Shuffle is when everybody looks right, you go left.’ ”

The banks’ reaction? Justice Schack shrugs. “They probably curse at me,” he says, “but no one is interested in some little judge.”

Little drama attends the release of his decisions. Beaten-down homeowners rarely show up to contest foreclosure actions, and the judge scrutinizes the banks’ papers in his chambers. But at legal conferences, judges and lawyers have wondered aloud why more judges do not hold banks to tougher standards.

“To the extent that judges examine these papers, they find exactly the same errors that Judge Schack does,” said Katherine M. Porter, a visiting professor at the School of Law at the University of California, Berkeley, and a national expert in consumer credit law. “His rulings are hardly revolutionary; it’s unusual only because we so rarely hold large corporations to the rules.”

Banks and the cottage industry of mortgage service companies and foreclosure lawyers also pay rather close attention.

A spokeswoman for OneWest Bank acknowledged that an official, confronted with a ream of foreclosure papers, had mistakenly signed for two different banks — just as the Deutsche Bank official did. Deutsche Bank, which declined to let an attorney speak on the record about any of its cases before Justice Schack, e-mailed a PDF of a three-page pamphlet in which it claimed little responsibility for foreclosures, even though the bank’s name is affixed to tens of thousands of such motions. The bank described itself as simply a trustee for investors.

Justice Schack came to his recent prominence by a circuitous path, having worked for 14 years as public school teacher in Brooklyn. He was a union representative and once walked a picket line with his wife, Dilia, who was a teacher, too. All was well until the fiscal crisis of the 1970s.

“Why’d I go to law school?” he said. “Thank Mayor Abe Beame, who froze teacher salaries.”

He was counsel for the Major League Baseball Players Association in the 1980s and ’90s, when it was on a long winning streak against team owners. “It was the millionaires versus the billionaires,” he says. “After a while, I’m sitting there thinking, ‘He’s making $4 million, he’s making $5 million, and I’m worth about $1.98.’ ”

So he dived into a judicial race. He was elected to the Civil Court in 1998 and to the Supreme Court for Brooklyn and Staten Island in 2003. His wife is a Democratic district leader; their daughter, Elaine, is a lawyer and their son, Douglas, a police officer.

Justice Schack’s duels with the banks started in 2007 as foreclosures spiked sharply. He saw a plague falling on Brooklyn, particularly its working-class black precincts. “Banks had given out loans structured to fail,” he said.

The judge burrowed into property record databases. He found banks without clear title, and a giant foreclosure law firm, Steven J. Baum, representing two sides in a dispute. He noted that Wells Fargo’s chief executive, John G. Stumpf, made more than $11 million in 2007 while the company’s total returns fell 12 percent.

“Maybe,” he advised the bank, “counsel should wonder, like the court, if Mr. Stumpf was unjustly enriched at the expense of W.F.’s stockholders.”

He was, how to say it, mildly appalled.

“I’m a guy from the streets of Brooklyn who happens to become a judge,” he said. “I see a bank giving a $500,000 mortgage on a building worth $300,000 and the interest rate is 20 percent and I ask questions, what can I tell you?”

THE REAL EMPLOYERS OF THE SIGNERS OF

MORTGAGE ASSIGNMENTS TO TRUSTS

BY Lynn E. Szymoniak, Esq., Editor, Fraud Digest (szymoniak@mac.com),

April 15, 2010

On May 11, 2010, Judge Arthur J. Schack, Supreme Court, Kings County, New York, entered an order denying a foreclosure action with prejudice. The case involved a mortgage-backed securitized trust, SG Mortgage Securities Asset Backed Certificates, Series 2006-FRE2. U.S. Bank, N.A. served as Trustee for the SG Trust. See U.S. Bank, N.A. v. Emmanuel, 2010 NY Slip Op 50819 (u), Supreme Court, Kings County, decided May 11, 2010. In this case, as in hundreds of thousands of other cases involving securitized trusts, the trust inexplicably did not produce mortgage assignments from the original lender to the depositor to the securities company to the trust.

This particular residential mortgage-backed securities trust in the Emmanuel case had a cut-off date of July 1, 2006. The entities involved in the creation and early agreements of this trust included Wells Fargo Bank, N.A., as servicer, U.S. Bank, N.A. as trustee, Bear Stearns Financial Products as the “swap provider” and SG Mortgage Securities, LLC. The Class A Certificates in the trust were given a rating of “AAA” by Dominion Bond Rating Services on July 13, 2006.

The designation “FRE” in the title of this particular trust indicates that the loans in the trust were made by Fremont Investment & Loan, a bank and subprime lender and subsidiary of Fremont General Corporation. The “SG” in the title of the trust indicates that the loans were “securitized” by Signature Securities Group Corporation, or an affiliate.

Fremont, a California-based corporation, filed for Chapter 11 bankruptcy protection on June 19, 2008, but continued in business as a debtor-in-possession. On March 31, 2008, Fremont General sold its mortgage servicing rights to Carrington Capital Management, a hedge fund focused on the subprime residential mortgage securities market. Carrington Capital operated Carrington Mortgage Services, a company that had already acquired the mortgage servicing business of New Century after that large sub-prime lender also filed for bankruptcy. Carrington Mortgage Services provides services a portfolio of nearly 90,000 loans with an outstanding principal balance of over $16 billion. Nearly 63% of the portfolio is comprised of adjustable rate mortgages. Mortgage servicing companies charge  substantially higher fees for servicing adjustable rate mortgages than fixed-rate mortgages. Those fees, often considered the most lucrative part of the subprime mortgage business, are paid by the securitized trusts that bought the loans from the original lenders (Fremont & New Century), after the loans had been combined into trusts by securities companies, like Financial Assets Securities Corporation, SG and Carrington Capital.

Carrington Capital in Greenwich, Connecticut, is headed by Bruce Rose, who left Salomon Brothers in 2003 to start Carrington. At Carrington, Rose packaged $23 billion in subprime mortgages. Many of those securities included loans originated by now-bankrupt New Century Financial. Carrington forged unique contracts that let it direct any foreclosure and liquidations of the underlying loans. Foreclosure management is also a very lucrative part of the subprime mortgage business. As with servicing adjustable rate mortgages, the fees for the foreclosure management are paid ultimately by the trust. There is little or no oversight of the fees charged for the foreclosure actions. The vast majority of foreclosure cases are uncontested, but the foreclosure management firms may nevertheless charge the trust several thousand dollars for each foreclosure of a property in the trust.

The securities companies and their affiliates also benefit from the bankruptcies of the original lenders. On May 12, 2010, Signature Group Holdings LLP, (“SG”) announced that it had been chosen to revive fallen subprime mortgage lender Freemont General, once the fifth-largest U.S. subprime mortgage lender. A decision to approve Signature’s reorganization plan for Fremont was made through a bench ruling issued by the U.S. Bankruptcy Court in Santa Ana, CA. The bid for Fremont lasted nearly two years, with several firms competing for the acquisition.

The purchase became much more lucrative for prospective purchasers in late March, 2010, when Fremont General announced that it would settle more than $89 million in tax obligations to the Internal Revenue Service without actually paying a majority of the back taxes. The U.S. Bankruptcy Court for the Central District of California, Santa Ana Division, approved a motion that allowed Fremont General to claim a net operating loss deduction for 2004 that is attributable for its 2006 tax obligations, according to a regulatory filing with the Securities and Exchange Commission.

In addition, Fremont General will deduct additional 2004 taxes, because of a temporary extension to the period when companies can claim the credit. The extension from two years to five went into effect when President Obama signed the Worker, Homeownership, and Business Assistance Act of 2009. While approved by the bankruptcy court judge, the agreement must also meet the approval of the Congressional Joint Committee on Taxation, but according to the SEC filing, both Fremont General and the IRS anticipate that it will be approved. In all, Fremont’s nearly $89.4 million tax assessment was reduced to about $2.8 million, including interest. In addition, as a result of the IRS agreement, a California Franchise Tax Board tax claim of $13.3 million was reduced to $550,000.

Another development that made the purchase especially favorable for SG was the announcement on May 10, 2010, that Federal Insurance Co. has agreed to pay Fremont General Corp. the full $10 million loss limits of an errors and omissions policy to cover subprime lending claims, dropping an 18-month battle over whether the claims were outside the scope of its bankers professional liability policies.

All of these favorable developments are part of a long history of success for Craig Noell, the head of Signature Group Holdings, the winning bidder for Fremont. Previously, as a member of the distressed investing area at Goldman Sachs, Noell founded and ran Goldman Sachs Specialty Lending, investing Goldman’s proprietary capital in “special situations opportunities.”

Bruce Rose’s Carrington Mortgage Services and Craig Noell’s Signature Group Holdings are part of the story of the attempted foreclosure on Arianna Emmanuel in Brooklyn, New York. U.S. Bank, N.A., as Trustee for SG Mortgage Securities Asset-Backed Certificates, Series 2006 FRE-2 attempted to foreclose on Arianna Emmanuel. The original mortgage had been made by Fremont Investment & Loan (the beneficiary of the $100 milion tax break and the $10 million insurance payout discussed above).

To successfully foreclose, the Trustee needed to produce proof that the Trust had acquired the loan from Fremont. At this point, the document custodian for the trust needed only to produce the mortgage assignment. The securities company that made the SG Trust, the mortgage servicing company that serviced the trust and U.S. Bank as Trustee had all made frequent sworn statements to the SEC and shareholders that these documents were safely stored in a fire-proof  vault.

Despite these frequent representations to the SEC, the assignment relied upon by U.S. Bank, the trustee, was one executed by Elpiniki Bechakas as assistant secretary and vice president of MERS, as nominee for Freemont. In foreclosure cases all over the U.S., assignments signed by Elpiniki Bechakas are never questioned. But on May 11, 2010, the judge examining the mortgage assignment was the Honorable Arthur J. Schack in Brooklyn, New York.

Bechakas signed as an officer of MERS, as nominee for Fremont, representing that the property had been acquired by the SG Trust in June, 2009. None of this was true. Judge Schack determined sua sponte that Bechakas was an associate in the law offices of Steven J. Baum, the firm representing the trustee and trust in the foreclosure. Judge Schack recognized that the Baum firm was thus working for both the GRANTOR and GRANTEE. Judge Schack wrote, “The Court is concerned that the concurrent representation by Steven J. Baum, P.C. of both assignor MERS, as nominee for FREMONT, and assignee plaintiff U.S. BANK is a conflict of interest, in violation of 22 NYCRR § 1200.0 (Rules of Professional Conduct, effective April 1, 2009) Rule 1.7, “Conflict of Interest: Current Clients.”

Judge Schack focused squarely on an issue that pro se homeowner litigants and foreclosure defense lawyers often attempt to raise – the authority of the individuals signing mortgage assignments that are used by trusts to foreclose. In tens of thousands of cases, law firm employees sign as MERS officers, without disclosing to the Court or to homeowners that they are actually employed by the law firm, not MERS, and that the firm is being paid and working on behalf of the Trust/Grantee while the firm employee is signing on behalf of the original lender/Grantor.

Did the SG Trust acquire the Emmanuel loan in 2006, the closing date of the trust, or in 2009, the date chosen by Belchakas and her employers? There are tremendous tax advantages being claimed by banks and mortgage companies based on their portfolio of nonperforming loans. There are also millions of dollars in insurance payouts being made ultimately because of non-performing loans. There are substantial fees being charged by mortgage servicing companies and mortgage default management companies – being paid by trusts and assessed on homeowners in default. The question of the date of the transfer is much more than an academic exercise.

As important as the question of WHEN, there is also the question of WHAT – what exactly did the trust acquire? What is the reason for the millions of assignments to trusts that flooded recorders’ offices nationwide starting in 2007 that were prepared by law firm employees like Bechakas or by employees of mortgage default companies or document preparation companies specializing is providing “replacement” mortgage documents. Why, in judicial foreclosure states, are there thousands of Complaints for Foreclosure filed with the allegations: “We Own the Note; we had the note; we lost the note.” Why do bankruptcy courts repeatedly see these same three allegations in Motions For Relief of Stay filed by securitized trusts attempting to foreclose? If the assignments and notes are missing, has the trust acquired anything (other than investors’ money, tax advantages and insurance payouts)? In many cases, the mortgage servicing company does eventually acquire the property – often by purchasing the property after foreclosure for ten dollars and selling it to the trust that had claimed ownership from the start.

Where are the missing mortgage assignments?

BACKLOG

1. Dismiss all cases filed after February 11, 2010, that do not include a verification in accordance with the Florida Supreme Court revised  rules of Civil Procedure.   The big foreclosure firms, particularly the Law Offices of David Stern, are choosing to ignore the rule requiring verifications.  All parties should be required to follow the rules.

2. Dismiss all of the cases where the plaintiff is a bank “as Trustee” but the name of the trust is not disclosed.  Failure to identify the actual trust is one of the newest strategies of the foreclosure mills.  The trust, not the trustee, is the real party in interest.

3. Dismiss all of the cases where the complaint is not signed by the attorney whose name appears on the pleading.  The big foreclosure firms in thousands of cases have someone other than the attorney on the pleading sign “for” the attorney who drafted the pleading.  This is done so that both attorneys can deny responsibility.

4. Dismiss all of the cases that include these boilerplate allegations by the bank or trust: “We own the note. We had possession of the note. We lost the note.”  These allegations appear in over 20,000 cases.  By now it is apparent this is a ruse – no one actually lost 20,000 mortgages and notes. Frauds upon the courts should not be tolerated.

5. Dismiss all of the cases that include a Mortgage Assignment that was signed by an employee of the foreclosure mill law firm signing as a MERS officer.  This would include thousands of cases where Cheryl Samons and Beth Cerni, administrative employees for David Stern, signed as a representative of the GRANTOR when the firm was actually working for the GRANTEE.  This would also include cases where Patricia Arango and Caryn Graham, two associates working for The Law Offices of Marshall C. Watson, signed as MERS officers.  This would also include all cases where Christopher Bossman, an administrative employee in the Daniel Consuegra fiirm, signed as a MERS officer.  This would also include all cases where officers of Florida Default Law Group signed as MERS officers. In all of these cases, no disclosure was made to the Court or to the homeowner/defendants that the Assignments were prepared by law firm employees with no knowledge of the truth of the matters asserted therein.

6. Dismiss all of the cases where a Mortgage Assignment was signed by Jeffrey Stephan of GMAC (notarized in Montgomery County, PA).  Stephan has already admitted in sworn testimony that a notary was NOT present when he signed mortgage assignments, even though the Assignments contained a contrary statement.

7. Dismiss all of the cases where the documents were prepared by employees of Lender Processing Services since this company has already admitted in its Annual Statement with the SEC that investigations, internal and otherwise, revealed problems with the documents that were so significant that the company implemented a “remediation” program (and in January, 2010, laid off most of its employees in Alpharetta, GA. Until this company discloses which documents were determined to be defective, and what corrective actions were taken, no documents from LPS submitted to establish ownership and standing (notarized in Fulton County, GA; Duval County, FL and Dakota County, MN) should be relied upon by the Courts.

8. Dismiss all cases where a Mortgage Assignment has been made by American Brokers Conduit, American Home Mortgage Acceptance or American Home Mortgage Company, or nominees or mortgage servicing companies working for these American Home companies, after August 6, 2007, the day these companies filed for bankruptcy.  The bankruptcy court did not authorizing these actions.

If Palm Beach County judges looked critically at the documents submitted by the foreclosure mills,  they would reach the same conclusion as judges in other Florida Circuits – that the documents submitted by the foreclosure mills are worthless and the attorneys submitting these documents deserve strict sanctions.

LYNN E. SZYMONIAK ESQ.

Good points to learn.

[ipaper docId=30956413 access_key=key-24x2kud1l0tlsbm92i4r height=600 width=600 /]

In the past few days CORPORATIONS involved in Assignment of Mortgage Fraud may have asked search engines nicely to keep recent news or discoveries associated with bloggers who may have been affected by this “fraud” from hitting GOOGLE, BING, YAHOO, TWITTER and the likes. NOT FOR LONG!

The damage has been caused and I can tell you from last months hits…THE WHOLE WORLD knows and ARE WATCHING!

We installed a clustrmap on the right a few days ago so we can keep track!

RELATED STORY: OPERATION “DARK CLOUD”

Via: b.daviesmd6605

Included here is a short excerpt that discusses the way MERS allows nearly any member have MERS authority to sign documents. The article says that some states require the signor to be a VP of the actual member. Eventually some states allow them to be an authorized signatory despite not being an employee. If any late assignments apply to you this is then a must read.

[ipaper docId=30807513 access_key=key-2jtfrih99eg7hyj51oi0 height=600 width=600 /]

What a disaster! This ruling is absolutely hideous!

• Ask these “VP’s” where MERS is located?
• Who do they answer to?
• Who is their superior in MERS?
• How many meetings do they attend?
• Are they paid employees?
• What MERS branch do they work out of?

COMPLETE AND UTTER BULL SHIT!

Under the contract with MERS, they were appointed…

“CORRECTION “SELF” APPOINTED”

The instant motion for summary judgment concerns only one Defendant: Lender Processing Services (“LPS”). LPS “process[es] the necessary paperwork to pursue non-judicial foreclosure on behalf of its servicer and lender clients.” (Allen Decl. (Dkt. No. 74 at 1).) LPS had contracts with Defendants IndyMac Bank (now IndyMac Federal Bank) and Mortgage Electronic Registration Systems (“MERS”). Under the contract with MERS, LPS^[3] employees were “appointed as assistant secretaries and vice presidents of [MERS] and, as such, are authorized to . . . execute any and all documents necessary to foreclose upon the property securing any mortgage loan registered on the MERS system

[ipaper docId=30483227 access_key=key-1wvrddmbshf3b79tlcrz height=600 width=600 /]

How about Christina’s many signatures and positions in 1-5 banks below? So not only does she sign for MERS????

[youtube=http://www.youtube.com/watch?v=3tL8mNL4bYw]

Hypothetically…even *if* they had authority…they are FORGING these documents!!!

Dear Mr. Jadlos,

Exactly who is gaming what sir? Please see this post and lets call it BULLSHIT! 

Foreclosure Backlog Helps Troubled Borrowers

21 April 2010 @ 03:03 pm EDT

An estimated 1.4 million borrowers have failed to pay their mortgages in more than a year, but continue to live in the properties, according to Lender Processing Services, which tracks mortgages on 40 million homes.

Under the new government regulations, it takes banks 14 months to evict nonpaying borrowers – longer in some states. “Many of these people are gaming the system,” said Ted Jadlos, a managing director at Lender Processing.

Also, banks aren’t in a hurry because once they take possession of a property they must write down its value to reflect market price. Plus, unoccupied homes are more likely to fall into disrepair or be vandalized.

Some analysts predict that this shadow inventory will cause prices to slide further, but so far it’s not happening.

Reprinted from REALTOR® Magazine Online with permission of the NATIONAL ASSOCIATION OF REALTORS®. Copyright

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!

[youtube=http://www.youtube.com/watch?v=zQ9p6ZFquNY]

TAKE NOTICE!

Via 4Closurefraud:

U.S. Bank National Assoc., as Trustee v. Ernest E. Harpster Sl-2007-CA-6684-ES

Via Matt Weidners Blog

Well well well…

Looks like an Assignment of Mortgage was FRAUDULENTLY created by David Sterns office and signed by Cheryl Samons. Who woulda thunk…

“By now the fact that foreclosure mills, pretender lenders and their document mills across the country are perpetrating widespread and systemic fraud on the courts is not news.  Well sure major questions remain unanswered such as what will be the ultimate price of all this fraud…as reported previously much of this fraud will go unpunished because much of the evidence is apparently being sent back to the law firms that commit the fraud. (In violation of court rules)  But so much is sliding by these days.

We all must do everything we can to bring fraud to the court’s attention and to preserve the evidence when it is found.  Attached here is the brilliant work of a Foreclosure Fraud Fighter, Ralph Fisher of Tampa, Florida who shows us what the courts are willing to do when a good attorney makes AND PROVES a case of fraud…..Case dismissed WITH PREJUDICE”.

From the order

The hearing time was set for March 1, 2010 at 3 p.m.  for a 20-minute hearing but the Plaintiff  failed to appear.

after sounding the halls and after awaiting telephonic communication from  the Plaintiff. The Plaintiff  still failed  to appear. An assistant for Plaintiff  s counsel called at about 3:44 p.m.  to  find out the outcome of  the hearing.

Motion to Compel, the court finds  that the Plaintiff  has failed  to produce answers to  the Interrogatories for a period of  26 months

The Defendant’s Motion in  Limine/Motion to  Strike was based on an allegation that the Assignment of Mortgage was created after the  filing of  this action, but the document date and notarial date were purposely backdated by  the Plaintiff to a date prior the filing of  this foreclosure action.

The Assignment, as an  instrument of  fraud  in  this Court intentionally perpetrated upon this court by the Plaintiff, was made to appear as though it was created and notorized on December 5, 2007. However, that purported creation/notarization date was facially  impossible:  the stamp on the notary was dated May 19,2012. Since Notary commissions only last four years in Florida (see F  .S.  Section 117.01  (l  )), the notary stamp used on this instrument did not even exist until approximately five months after the purported date on the Assignment.

The court specifically finds  that the purported Assignment did not exist at the time of  filing of this action;  that the purported Assignment was subsequently created and the execution date and notarial date were fraudulently backdated, in a purposeful, intentional effort to mislead the Defendant and this Court. The Court rejects the Assignment and finds  that is not entitled to introduction in evidence for any purpose. The Court finds  that the Plaintiff does not have standing to bring its action.

IT IS THEREFORE. ORDERED AND ADJUDGED THAT:

The Motion to Compel is granted. As a sanction for egregious failure to comply with discovery Rules the Plaintiff  shall be prohibited from presenting the alleged Promissory Note to  this Court.

The Plaintiff  shall be prohibited from introducing into evidence the alleged Promissory Note.

The Plaintiff’s recording and filing regarding the fraudulent Assignment of Mortgage is  stricken, and the Plaintiff  is prohibited from entering the Assignment of Mortgage into evidence.

The Motion for Rehearing of Defendant’s Motion to Dismiss is granted and the Motion to Dismiss is granted. The Plaintiff’s complaint is dismissed with prejudice, based on the fraud intentionally perpetrated upon the Court by the Plaintiff.

Moral to the story… ALL assignments are FRAUDULENT.

CHALLENGE EVERYTHING!