After a quick review of its procedures, Bank of America this week announced that it will resume its foreclosures in 23 lucky states next Monday. While the evidence is overwhelming that the entire foreclosure process is riddled with fraud, President Obama refuses to support a national moratorium. Indeed, his spokesmen on the issue told reporters three key things. As the Los Angeles Times reported:
A government review of botched foreclosure paperwork so far has found that the problems do not pose a “systemic” threat to the financial system, a top Obama administration official said Wednesday.
Yes, that’s right. HUD reviewed the “paperwork” problem to see whether it threatened the banks — not the homeowners who were the victims of foreclosure fraud. But it got worse, for the second point was how the government would respond to the epidemic of foreclosure fraud.
The Justice Department is leading an investigation of possible crimes involving mortgage fraud.
That language was carefully chosen to sound reassuring. But the fact is that despite our pleas the FBI has continued its “partnership” with the Mortgage Bankers Association (MBA). The MBA is the trade association of the “perps.” It created a ridiculous on its face definition of “mortgage fraud.” Under that definition the lenders — who led the mortgage frauds — are the victims. The FBI still parrots this long discredited “definition.” That is one of the primary reasons why — in complete contrast to prior financial crises — the Justice Department has not convicted a single senior officer of the large nonprime lenders who directed, committed, and profited enormously from the frauds.
Note that the Justice Department is not investigating foreclosure fraud. HUD Secretary Donovan’s statement shows why:
“We will not tolerate business as usual in the mortgage market,” he said. “Where there have been mistakes made or errors, we will hold those entities, those institutions, accountable to stop those processes, review them and fix them as quickly as possible.”
Note the language: “mistakes”, “errors”, “processes” (following the initial use of “paperwork”). No mention of “fraud”, “felony”, “criminal investigations”, or “prosecutions” for the tens of thousands of felonies that representatives of the entities foreclosing on homes have admitted that they committed. Note that Donovan does not even demand that the felons remedy the harm caused by their past fraudulent foreclosures. Donovan wants them to “fix” “processes” — not repair the harm their frauds caused to their victims.
The fraudulent CEOs looted with impunity, were left in power, and were granted their fondest wish when Congress, at the behest of the Chamber of Commerce, Chairman Bernanke, and the bankers’ trade associations, successfully extorted the professional Financial Accounting Standards Board (FASB) to turn the accounting rules into a farce. The FASB’s new rules allowed the banks (and the Fed, which has taken over a trillion dollars in toxic mortgages as wholly inadequate collateral) to refuse to recognize hundreds of billions of dollars of losses. This accounting scam produces enormous fictional “income” and “capital” at the banks. The fictional income produces real bonuses to the CEOs that make them even wealthier. The fictional bank capital allows the regulators to evade their statutory duties under the Prompt Corrective Action (PCA) law to close the insolvent and failing banks.
New York is instituting new filing requirements in order to ensure the integrity of the home foreclosure process, the state’s chief judge said Wednesday.
Lawyers bringing foreclosure claims will now be required to file an affirmation that they themselves have taken reasonable steps to verify the accuracy of documents filed in support of residential foreclosures.
“We cannot allow the courts in New York State to stand by idly and be party to what we now know is a deeply flawed process, especially when that process involves basic human needs–such as a family home–during this period of economic crisis,” said New York State Chief Judge Jonathan Lippman in a statement.
The new filing requirement goes into effect immediately. In new cases, the affirmation must be filed along with the initial request for judicial intervention. In pending cases, it must accompany a request for judgment or must be submitted to the court referee if a judgment has been entered, but the property hasn’t yet sold.
New York courts will become the first in the United States to require lawyers handling foreclosures for banks and servicers to take steps to ensure the procedure is done properly, the state’s top judge said on Wednesday.
Agency looking into whether industry has broken criminal laws
msnbc.com news services
updated 1 hour 21 minutes ago 2010-10-20T15:38:09
WASHINGTON — The foreclosure-document crisis just keeps on growing, and now the FBI is getting into the fray.
A federal law enforcement official told the Associated Press that the agency is in the initial stages of trying to determine whether the financial industry may have broken criminal laws in the mortgage foreclosure crisis.
The official said the question is whether some in the industry were acting with criminal intent or were simply overwhelmed by events in the wake of the housing market’s collapse. The official spoke on condition of anonymity because the investigation is just getting under way.
Big lenders are trying to move past the foreclosure-document crisis, saying they are now confident their paperwork is accurate. But they are facing so much organized resistance that they can’t just snap up their briefcases, declare the crisis over and move on.
Consider the opposition:
Attorneys general in all 50 states are jointly investigating whether lenders violated state laws.
Lawyers for evicted homeowners are preparing lawsuits against major lenders.
State judges have signaled they will review the banks’ foreclosure documents with skepticism.
Lawmakers on Capitol Hill plan to hold hearings.
The document crisis, in other words, appears far from over.
Washington Post Staff Writer
Tuesday, October 19, 2010; 3:10 PM
Federal law enforcement officials are investigating possible criminal violations in connection with the national foreclosure crisis, examining whether financial firms broke federal laws when they filed fraudulent court documents to seize people’s homes, according to people familiar with the matter.
The Obama administration’s Financial Fraud Enforcement Task Force is in the early stages of an investigation into whether banks and other companies that submitted flawed paperwork in state foreclosure proceedings may also have misled federal housing agencies, which now own or insure a majority of home loans, according to these sources.
The task force, which includes investigators from the Justice Department, Department of Housing and Urban Development and other agencies, is also looking into whether the submission of flawed paperwork during the foreclosure process violated mail or wire fraud laws. Financial fraud cases often involve these statutes.
Robert S. Mueller III
Director Federal Bureau of Investigation
935 Pennsylvania Ave, NW
Washington, DC 20535
Robert O’Neill
US Attorney
Central District of Florida
400 North Tampa Street, Suite 3200
Tampa, FL 33602
Dear US Attorney Robert O’Neill and Director Mueller,
When it comes to foreclosures, there is mounting evidence of a state of rampant lawlessness in Central Florida. There are increasing signs that big banks routinely evade laws meant to protect homeowners, in many well-documented cases of ‘foreclosure fraud’. Despite the demonstrated existence, for instance, of ‘robosigners’ signing affidavits attesting to documents that they have never seen, the parties engaging in such misconduct are not being brought to justice. Big banks are mischaracterizing this as mere “technical problems,” and apologizing only where there is clear and very public evidence of harm.
It is not enough for big banks only to apologize for fraud, perjury, and even breaking and entering – when they are caught. It is time for handcuffs. Fraud does not become legal just because a big bank does it.
On September 20, 2010, after my office found evidence of systemic foreclosure fraud perpetrated by big banks and foreclosure mills, I called for a halt to illegal foreclosures.
Since then, big banks such as Bank of America, JP Morgan Chase, GMAC, PNC and others have suspended foreclosures or foreclosure sales. These banks are still claiming that the massive fraud they have perpetrated amounts to nothing more than a series of technical mistakes. This is absurd. This is deliberate, systemic fraud, and it is a crime.
To give but two of the many available examples, attached is a deposition from an ex-employee of one of the largest ‘foreclosure mills’ in the state, the Law Offices of David Stern. In it, this employee testifies under oath that it was routine for that office to falsify documents regarding military records, in order to move foreclosure cases along more quickly.
The local media has reported on the case of Nancy Jacobini; a contractor for JP Morgan Chase broke into her home after the bank mistakenly foreclosed on it. JP Morgan Chase ‘apologized’ for terrifying her. But we do not have an apology-based legal system; we have a system of laws. I am writing to ask you to enforce them.
The organized and systematic manufacturing of falsified documents to deprive people of their homes is not only a threat to the integrity of the legal system. It also aggravates and extends the weakness in the housing market. Who is going to feel comfortable buying a home if a big bank can simply take it, whether or not that bank has a right to it? Given the securitization of mortgage-backed securities, this misconduct is a threat to our securities markets as well. But fundamentally, this is a question of protecting basic property rights – if you don’t own it, then you shouldn’t try to take it. Without clear property rights, and a legal system that insists on clear proof of those rights before transferring ownership by force, the economy will fall apart.
If perpetrators of perjured affidavits and other systematic criminal activity can get off simply with civil liability — or even less, an insincere bureaucratic apology — the freedom that Americans enjoy will erode quickly in the face of lawless seizures of property. I appreciate your work on the joint Middle District of Florida’s Mortgage Fraud Initiative, and respectfully request that the efforts of your offices turn towards reining in this rampant criminality.
Today the Florida Attorney General issued Subpoenas Duces Tecum’s to both Lender Processing Services Inc. and to a subsidiary DOCX. This involves employees past or present, the four foreclosure firms currently being investigated.
Both Assistant AG’s “McCollum’s Angels” June Clarkson and Theresa Edwards are doing an outstanding job!
STATE OF FLORIDA
OFFICE OF THE ATTORNEY GENERAL
DEPARTMENT OF LEGAL AFFAIRS
______________________________________
ECONOMIC CRIMES
INVESTIGATIVE SUBPOENA DUCES TECUM
“You,” “Your” or “DOC X” as used herein means DOCX, L.L.c. and any ofthe respondents, their agents and employees or any “affiliate” of the aforementioned entities, as that term is herein defined. Your agents include but are not limited to your officers, directors, attorneys, accountants, CPA’s, advertising consultants, or advertising account representatives. Any document in the possession ofyou, your affiliates, your agents or your employees is deemed to be within your possession or control. You have the affirmative duty to contact your agents, affiliates and employees and to obtain documentation from them, if such documentation is responsive to this subpoena.
B. Unless otherwise indicated, documents to be produced pursuant to this subpoena should include all original documents prepared, sent, dated, received, in effect, or which otherwise came into existence at any time. If your “original” is a photocopy, then the photocopy would be and should be produced as the original.
C. This subpoena duces tecum calls for the production of all responsive documents in your possession, custody or control without regard to the physical location ofsaid documents.
D. “And” and “or” are used as terms of inclusion, not exclusion.
E. The documents to be produced pursuant to each request should be segregated and specifically identified to indicate clearly the particular numbered request to which they are responsIve.
F. In the event that you seek to withhold any document on the basis that is properly entitled to some privilege or limitation, please provide the following information:
1. A list identifying each document for which you believe a limitation exists;
2. The name of each author, writer, sender or initiator of such document or thing, if any;
3. The name of each recipient, addressee or party for whom such document or thing was intended, ifany;
4. The date of such document, if any, or an estimate thereof so indicated if no date appears on the document;
5. The general subject matter as described in such document, or, if no such description appears, then such other description sufficient to identify said document; and
6. The claimed grounds for withholding the document, including, but not limited to, the nature of any claimed privilege and grounds in support thereof.
G. For each request, or part thereof, which is not fully responded to pursuant to a privilege, the nature of the privilege and grounds in support thereof should be fully stated.
H. If you possess, control or have custody of no documents responsive to any of the numbered requests set forth below, state this fact in your response to said request.
1. For purposes of responding to this subpoena, the term “document” shall mean all writings or stored data or information ofany kind, in any form, including the originals and all nonidentical copies, whether different from the originals by reason of any notation(s) made on such copies or otherwise, including, without limitation: correspondence, notes, letters, telegrams, minutes, certificates, diplomas, contracts, franchise agreements and other agreements, brochures, pamphlets, forms, scripts, reports, studies, statistics, inter-office and intra-office communications, training materials, analyses, memoranda, statements, summaries, graphs, charts, tests, plans, arrangements, tabulations, bulletins, newsletters, advertisements, computer printouts, teletype, telefax, microfilm, e-mail, electronically stored data, price books and lists, invoices, receipts, inventories, regularly kept summaries or compilations of business records, notations of any type of conversations, meetings, telephone or other communications, audio and videotapes; electronic, mechanical or electrical records or representations of any kind (including without limitation tapes, cassettes, discs, magnetic tapes, hard drives and recordings to include each document translated, if necessary, through detection devices into reasonably usable form).
1. For purposes of responding to this subpoena, the term “affiliate” shall mean: a corporation, partnership, business trust, joint venture or other artificial entity which effectively controls, or is effectively controlled by you, or which is related to you as a parent or subsidiary or sibling entity. “Affiliate” shall also mean any entity in which there is a mutual identity of any officer or director. “Effectively controls” shall mean having the status of owner, investor (if 5% or more of voting stock), partner, member, officer, director, shareholder, manager, settlor, trustee, beneficiary or ultimate equitable owner as defined in Section 607.0505(11)(e), Florida Statutes.
K. The term “Florida affiliates” shall mean those of your affiliates which do business in Florida or which are licensed to do business in Florida.
L. If production of documents or other items required by this subpoena would be, in whole or in part, unduly burdensome, or if the response to an individual request for production may be aided by clarification of the request, contact the Assistant Attorney General who issued this subpoena to discuss possible amendments or modifications of the subpoena, within five (5) days of receipt ofsame.
M. Documents maintained in electronic form must be produced in their native electronic form with all metadata intact. Data must be produced in the data format in which it is typically used and maintained. Moreover, to the extent that a responsive Document has been electronically scanned (for any purpose), that Document must be produced in an Optical Character Recognition (OCR) format and an opportunity provided to review the original Document. In addition, documents that have been electronically scanned must be in black and white and should be produced in a Group IV TIFF Format (TIF image format), with a Summation format load file (dii extension). DII Coded data should be received in a (Comma-Separated Values) CSV format with a pipe (I) used for multivalue fields. Images should be single page TIFFs, meaning one TIFF file for each page of the Document, not one .tifffor each Document. Ifthere is no text for a text file, the following should be inserted in that text file: “Page Intentionally Left Blank.”
Moreover, this Subpoena requires all objective coding for the production, to the extent it exists. For electronic mail systems using Microsoft Outlook or LotusNotes, provide all responsive emails and, if applicable, email attachments and any related Documents, in their native file format (i.e., .pst for Outlook personal folder, .nsf for LotusNotes). For all other email systems, provide all responsive emails and, if applicable, email attachments and any related Documents in OCR and TIFF formats as described above.
P. The relevant time period for the present request shall be from January 1, 2006 to present unless otherwise specifically stated. YOU ARE HEREBY COMMANDED to produce at said time and place all documents, as defined above, relating to the following subjects:
1. Copies ofall “Network Agreements” between DOCX and any law firm with offices located in the State of Florida.
2. Copies of any and all underlying documentation that allows for your employee or ex-employee, Linda Green to sign documents in the following capacities:
a. Vice President of Loan Documentation, Wells Fargo Bank, N.A. successor by merger to Wells Fargo Home Mortgage, Inc.; ;
b. Vice President, Mortgage Electronic Registration Systems, Inc. as nominee for American Home Mortgage Acceptance, Inc.;
c. Vice President, American Home Mortgage Servicing as successor-in-interest to Option One Mortgage Corporation;
d. Vice President, Mortgage Electronic Registration Systems, Inc. as nominee for American Brokers Conduit;
e. Vice President & Asst. Secretary, American Home Mortgage Servicing, Inc., as servicer for Ameriquest Mortgage Corporation;
f. Vice President, Option One Mortgage Corporation;
g. Vice President, Mortgage Electronic Registration Systems, Inc. as nominee for HLB Mortgage;
h. Vice President, American Home Mortgage Servicing, Inc.;
1. Vice President, Mortgage Electronic Registration Systems, Inc. as nominee for Family Lending Services, Inc.;
J. Vice President, American Home Mortgage Servicing, Inc. as Successor -ininterest to Option One Mortgage Corporation;
k. Vice President, Argent Mortgage Company, LLC by Citi Residential Lending, Inc., attorney-in-fact;
m. Vice President, Amtrust Funsing (sic) Services, Inc., by American Home Mortgage Servicing, Inc., as Attorney-in -fact;
n. Vice President, Seattle Mortgage Company.
3. Copies of every document signed in any capacity by Linda Green.
4. Copies of any and all underlying documentation that allows for your employee or ex-employee, Korell Harp to sign documents in any capacity for any lender and/or servicing company.
5. Copies of any and all underlying documentation that allows for your employee or ex-employee, Jessica Ohde to sign documents in any capacity for any lender and/or servicing company.
6. Copies of any and all underlying documentation that allows for your employee or ex-employee, Pat Kingston to sign documents in any capacity for any lender and/or servicing company.
7. Copies of any and all underlying documentation that allows for your employee or ex-employee, Christina Huang to sign documents in any capacity for any lender and/or servicing company.
8. Copies of any and all underlying documentation that allows for your employee or ex-employee, Tywanna Thomas to sign documents in any capacity for any lender and/or servicing company.
9. All policy and procedure manuals and/or training materials regarding the methods and timing that DOCX uses, including without limitation relating to the drafting and/or execution of foreclosure and mortgage related documents, including but not limited to Assignments of Mortgage, Satisfactions ofMortgage and Affidavits ofany and all kind.
10. A list ofall employees, dates ofhire and termination, and their duties, including whether or not they provide any notary services for DOCX.
11. All documents in your possession regarding any contracts with Florida Default Law Group, P.L., The Law Offices of David J. Stem, P.A., Shapiro & Fishman, L.L.P. and The Law Offices of Marshall C. Watson, P.A., including contracts regarding payments to or from any of those entities.
12. Documents relating to the relationship between DOCX and NewTrac and/or NewInvoice, including but not limited to, documents relating to the types ofdocuments that are or can be generated or are requested to be generated.
13. Any price lists published in any manner to prospective customers, whether by printed or electronic means.
14. All communications between DOCX and Florida Default Law Group, P.L., The Law Offices of David J. Stem, P.A., Shapiro & Fishman, L.L.P. or The Law Offices ofMarshall C. Watson, P.A. relating to procedures, policies, instructions or performance ofthe creation, backdating, modification, amendment, or other alteration ofany real property-related transactional document or records, including assignments, satisfactions ofmortgage, affidavits, notes, allonges, or other documents filed in any court.
15. Ledgers ofall financial transactions between DOCX and Florida Default Law Group, P.L., The Law Offices of David J. Stem, P.A., Shapiro & Fishman, L.L.P. or The Law Offices of Marshall C. Watson, P .A.
16. Ledgers ofall financial transactions between DOCX and any title company, recording service, process server, or any other entity that provides payments to DOCX in connection with any services rendered in connection with any residential foreclosure.
17. Ledgers ofall financial transactions between DOCX and any title company, recording service, process server, or any other entity to whom DOCX provides payment(s) in connection with any services rendered in connection with any residential foreclosure.
WITNESS the FLORIDA OFFICE OF THE ATTORNEY GENERAL in Fort Lauderdale, Florida, this 13th day of October, 2010.
June M. Clarkson
Assistant Attorney General
Florida Bar Number: 785709
OFFICE OF THE ATTORNEY GENERAL 110 S.E. 6th Street, 10th Floor
Fort Lauderdale, Florida 33301
Telephone: 954-712-4600
Facsimile: 954-712-4658
Theresa B. Edwards
Assistant Attorney General
Florida Bar Number: 252794
NOTE: In accordance with the Americans with Disabilities Act of 1990, persons needing a special accommodation to participate in this proceeding should contact George Rudd, Assistant Attorney General at (954) 712-4600 no later than seven days prior to the proceedings. Ifhearing impaired, contact the Florida Relay Service 1-800-955-8771 (TDD); or 1-800-955-8770 (Voice), for assistance.
AUTHORITY
Florida Statute 501.206
501.206 Investigative powers of enforcing authority.(
1) If, by his own inquiry or as a result ofcomplaints, the enforcing authority has reason to believe that a person has engaged in, or is engaging in, an act or practice that violates this part, he may administer oaths and affinnations, subpoena witnesses or matter, and collect evidence. Within 5 days excluding weekends and legal holidays, after the service ofa subpoena or at any time before the return date specified therein, whichever is longer, the party served may file in the circuit court in the county in which he resides or in which he transacts business and serve upon the enforcing authority a petition for an order modifying or setting aside the subpoena. The petitioner may raise any objection or privilege which would be available under this chapter or upon service of such subpoena in a civil action. The subpoena shall infonn the party served of his rights under this subsection.
(2) If matter that the enforcing authority seeks to obtain by subpoena is located outside the state, the person subpoenaed may make it available to the enforcing authority or his representative to examine the matter at the place where it is located. The enforcing authority may designate representatives, including officials ofthe state in which the matter is located, to inspect the matter on his behalf, and he may respond to similar requests from officials ofother states.
(3) Upon failure ofa person without lawful excuse to obey a subpoena and upon reasonable notice to all persons affected, the enforcing authority may apply to the circuit court for an order compelling compliance.
(4) The enforcing authority may request that the individual who refuses to comply with a subpoena on the ground that testimony or matter may incriminate him be ordered by the court to provide the testimony or matter. Except in a prosecution for perjury, an individual who complies with a court order to provide testimony or matter after asserting a privilege against selfincrimination to which he is entitled by law shall not have the testimony or matter so provided, or evidence derived there from, received against him in any criminal investigation proceeding.
(5) Any person upon whom a subpoena is served pursuant to this section shall comply with the tenns thereof unless otherwise provided by order of the court. Any person who fails to appear with the intent to avoid, evade, or prevent compliance in whole or in part with any investigation under this part or who removes, destroys, or by any other means falsifies any documentary material in the possession, custody, or control of any person subject to any such subpoena, or knowingly conceals any relevant infonnation with the intent to avoid, evade, or prevent compliance shall be liable for a civil penalty of not more than $5,000, reasonable attorney’s fees, and costs.
UPDATE: 49 ALL 50 State Attorney Generals…ALABAMA is signing up as well. CONFIRMED.
“What we have seen are not mere technicalities,” said Ohio Attorney General Richard Cordray. “This is about the private property rights of homeowners facing foreclosure and the integrity of our court system, which cannot enter judgments based on fraudulent evidence.”
Officials in 49 states launch foreclosure probe
By ALAN ZIBEL, AP Real Estate Writer Alan Zibel, Ap Real Estate Writer – 1 min ago
.
WASHINGTON – Officials in 49 states and the District of Columbia have launched a joint investigation into allegations that mortgage companies mishandled documents and broke laws in foreclosing on hundreds of thousands of homeowners.
The states’ attorneys general and bank regulators will examine whether mortgage company employees made false statements or prepared documents improperly.
Alabama was the only state not to join the investigation.
Attorneys general have taken the lead in responding to a nationwide scandal that’s called into question the accuracy and legitimacy of documents that lenders relied on to evict people from the homes. Employees of four large lenders have acknowledged in depositions that they signed off on foreclosure documents without reading them.
More than 2.5 million homes have been lost to foreclosure since the recession started in December 2007, according to RealtyTrac Inc. Another 3.3 million homes could be lost to foreclosure or distressed sale over the next four years, according to Moody’s Analytics.
The officials said they intend to use their investigation to fix these problems in the mortgage industry.
“This is not simply about a glitch in paperwork,” said Iowa Attorney General Tom Miller, who is leading the probe. “It’s also about some companies violating the law and many people losing their homes.”
Ally Financial Inc.’s GMAC Mortgage Unit, Bank of America and JPMorgan Chase & Co. already have halted questionable foreclosures. Other banks, including Citigroup Inc. and Wells Fargo & Co. have not stopped processing foreclosures, saying they did nothing wrong.
In a joint statement, the officials said they would look into evidence that legal documents were signed by mortgage company employees who “did not have personal knowledge of the facts asserted in the documents. They also said that many of those documents appear to have been signed without a notary public witnessing that signature, a violation of most state laws.
“What we have seen are not mere technicalities,” said Ohio Attorney General Richard Cordray. “This is about the private property rights of homeowners facing foreclosure and the integrity of our court system, which cannot enter judgments based on fraudulent evidence.”
Demands information from Bank of America, JP Morgan Chase, Wells Fargo and GMAC Mortgage/Ally ~Calls for suspension of foreclosures by mortgage servicers engaged in “robo-signing” in New York until accuracy of court documents and integrity of process are assured
NEW YORK, NY (October 12, 2010) – Attorney General Andrew M. Cuomo today announced that he is seeking information from four major mortgage servicers – Bank of America, JP Morgan Chase, Wells Fargo and GMAC Mortgage/Ally – concerning the filing of affidavits that falsely attest the signer has personal knowledge of the facts presented in home foreclosure proceedings, a practice known as “robo-signing.”
In view of the prevalence of this practice in the industry, Cuomo also called on mortgage servicers engaged in “robo-signing” in New York to immediately suspend all foreclosure actions in the state until they correct their procedures to comply with New York law and can assure the public and the courts that integrity has been restored.
“I will not allow New Yorkers to lose their homes due to mortgage goliaths that buck the system by submitting affidavits signed without knowledge of the facts,” said Attorney General Cuomo. “Such conduct is a fraud upon our courts and a slap in the face of New Yorkers struggling to get by in this economy. My office will continue to root out these practices so homeowners receive the full protections afforded by our judicial system.”
Recent reports indicate that employees of these mortgage servicers routinely signed affidavits submitted in foreclosure proceedings without personal knowledge of the underlying facts or verification of loan file information, and without even reading the documents they signed. This practice, known as “robo-signing,” has tainted the integrity of the foreclosure process by which homeowners in New York lose their homes. Bank of America, JP Morgan Chase and GMAC Mortgage announced that they were temporarily halting pending foreclosures, while Wells Fargo has not suspended foreclosures despite the deficiencies uncovered.
Attorney General Cuomo is calling on these mortgage servicers to submit documents and information to his office concerning how foreclosure documents are prepared, verified, attested to and notarized, and how required notices are provided to New York homeowners. The letters request that the mortgage servicers stop re-filing foreclosures that had been suspended (and in Wells Fargo’s case, cease proceeding with pending foreclosures) until the Attorney General’s Office is assured that reliable and fair procedures are in place and that accurate, trustworthy documentation will be submitted to the New York courts. The letters also request that the mortgage servicers refrain from filing any new foreclosures until they can provide assurances that their procedures comply with New York law and are neither tainted nor inaccurate.
Because of the gravity of these transgressions and the high volume of foreclosures, Attorney General Cuomo is calling on all mortgage servicers engaged in “robo-signing” in New York to immediately suspend all pending foreclosure actions in the state, including evictions and foreclosure sales. Cuomo is also requesting that the mortgage servicers not file any new foreclosures until the companies correct their procedures.
Tens of thousands of New Yorkers have been devastated by the foreclosure crisis. In fact, the foreclosure rates in Nassau and Suffolk Counties rank among the ten highest in the nation. More than 60,000 New York homes are currently in foreclosure, and 130,000 New York homeowners have received pre-foreclosure notices this year after falling behind on their mortgage payments.
In addition to his office’s review of Bank of America, Chase, Wells Fargo and GMAC Mortgage/Ally, Attorney General Cuomo is working with other state attorneys general, banking regulators and other interested parties to assess the veracity of servicers’ foreclosure filings and ensure the fairness and accuracy of their processes.
Attorney General Cuomo advises New York homeowners who are facing foreclosure proceedings to do the following:
Contact the court to find out the status of your foreclosure proceeding.
Seek representation or advice from a qualified attorney. If necessary, contact your local bar association or legal services office for a referral. If you are unable to retain counsel, carefully review any documents filed thus far with the court to ensure their accuracy.
If you have not done so already, immediately contact your lender or servicer to discuss available alternatives to foreclosure such as a loan modification.
Consult with a government-approved housing counseling agency. To find counselors approved by the U.S. Department of Housing and Urban Development (HUD) in your local area, call 800-569-4287 or visit www.hud.gov. A list of housing counselors also can be found via the NYS Banking Department at www.banking.state.ny.us.
Call HOPE NOW at 1-888-995-HOPE. HOPE NOW is an alliance of housing counselors, mortgage companies, investors and other mortgage market participants that provides free foreclosure prevention assistance.
If you live in New York City, call 311 to schedule free foreclosure counseling sessions at the Center for New York City Neighborhoods.
New York homeowners who believe their homes were foreclosed based upon false or inaccurate documents filed in court by their lender or servicer should seek representation from an attorney. They may also file a complaint with the New York Attorney General’s Bureau of Consumer Frauds & Protection by calling 800-771-7755 or visiting www.ag.ny.gov.
The investigation, led by Special Deputy Attorney General for Consumer Frauds & Protection Joy Feigenbaum, is being handled by Special Counsel Mary Alestra, Assistant Attorney General Brian Montgomery and Deputy Bureau Chief Jeffrey Powell of the Bureau of Consumer Frauds & Protection under the direction of Executive Deputy Attorney General for Economic Justice Maria Vullo and Deputy Attorney General for Economic Justice Michael Berlin.
By Dakin Campbell and Prashant Gopal – Oct 8, 2010 5:43 PM ET
Attorneys general in about 40 states may announce a joint investigation into foreclosures at the largest banks and mortgage firms, according to a person with direct knowledge of the matter.
State attorneys general led by Iowa’s Tom Miller are in talks that may lead to the announcement of a coordinated probe as soon as Oct. 12, said the person, who declined to be identified because a final agreement hasn’t been reached. The number of states may change because several are still deciding whether to join the investigation, the person said. New Mexico Attorney General Gary King said today in a statement that his state will join a multi-state effort.
Lawyers representing the banks are expecting a more widespread investigation, according to Patrick McManemin, a partner at Patton Boggs LLP, a Washington-based law firm that represents banks, loan servicers and financial institutions. Bank of America Corp., the biggest U.S. lender, today extended a freeze on foreclosures to all 50 states.
“We are aware of or involved in a large number of investigations that lead us to believe there are in the neighborhood of 40 state attorneys general who have initiated investigations or expressed an interest,” McManemin said in a telephone interview.
Lender Processing Services LPS held a conference call Wednesday to discuss its involvement in the mortgage foreclosure controversy and recent allegations against the company. Through its mortgage default services segment, which constitutes about half of the company’s revenue, LPS is deeply involved in processing mortgage foreclosures. Recently, with mortgage foreclosures heating up, there has been controversy surrounding lenders’ foreclosure procedures, which has led a few major mortgage lenders to halt foreclosures until they can verify that they are following the letter of the law. The main source of contention surrounds a practice called robo-signing. Whereas judicial foreclosure requires each foreclosure to be reviewed and vetted by someone knowledgeable about the case, lenders may have had employees signing foreclosures en masse without review. LPS had previously issued a press release stating that it is not involved in this practice, and it reiterated the point on the call. At this point, we see no reason to believe this is not correct, and we don’t see this as a major issue for the company.
The company also discussed two recent lawsuits filed against it, which allege that LPS illegally splits fees with foreclosure lawyers.
Please send me any Corporate Resolutions or Signing Agreements you may have. These were provided mainly to Vendors/ Foreclosure Mills. Not easy to get but also not impossible.
Be it Resolved that the attached list of candidates are employees of (Insert Name of MERS Member), a Member of Mortgage Electronic Registration Systems, Inc. (MERS), and are hereby appointed as assistant secretaries and vice presidents of MERS, and, as such, are authorized to:
(1) Release the lien of any mortgage loan registered on the MERS® System that is shown to be registered to the Member;
(2) Assign the lien of any mortgage loan naming MERS as the mortgagee when the Member is also the current promissory note-holder, or if the mortgage loan is registered on the MERS® System, is shown to be registered to the Member;
(3) 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, including but not limited to (a) substitution of trustee on Deeds of Trust, (b) Trustee’s Deeds upon sale on behalf of MERS, (c) Affidavits of Non-military Status, (d) Affidavits of Judgment, (e) Affidavits of Debt, (f) quitclaim deeds, (g) Affidavits
regarding lost promissory notes, and (h) endorsements of promissory notes to VA or HUD on behalf of MERS as a required part of the claims process;
(4) 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 proceeding regarding a loan registered on the MERS® System that is shown to be registered to the Member, including but not limited to: (a) executing Proofs of Claim and Affidavits of Movant under 11 U.S.C. Sec. 501-502, Bankruptcy Rule 3001-3003, and applicable local bankruptcy rules, (b) entering a Notice of Appearance, (c) vote for a trustee of the estate of the debtor, (d) vote for a committee of creditors, (e) attend the meeting of creditors of the debtor, or any adjournment thereof, and vote on behalf of the Member, the beneficial owner of such mortgage loan, or MERS, on any question that may be lawfully submitted before creditors in such a meeting, (f) complete, execute, and return a ballot accepting or rejecting a plan, and (g) execute reaffirmation agreements;
(5) Take any and all actions and execute all documents necessary to refinance, subordinate, amend or modify any mortgage loan registered on the MERS® System that is shown to be registered to the Member.
(6) Endorse checks made payable to Mortgage Electronic Registration Systems, Inc. to the Member that are received by the Member for payment on any mortgage loan registered on the MERS® System that is shown to be registered to the Member;
(7) 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).
I, William C. Hultman, being the Corporate Secretary of Mortgage Electronic Registration Systems, Inc., hereby certify that the foregoing is a true copy of a Resolution duly adopted by the Board of Directors of said corporation effective as of the day of , which is in full force and effect on this date and does not conflict with the Certificate of Incorporation or By-Laws of said corporation.
____________________________________
William C. Hultman, Secretary
Excellent resource on MERS below from the law department:
Below is a document that Lender Processing Services, Inc. or it’s many subsidiaries submits by wire transmission to the foreclosure mill with instructions NOT to name the actual owner of the note on the foreclosure but in the name of the servicer!
“FORECLOSURE SHOULD BE IN THE NAME OF ”
It clearly states the names of the real parties:
SERVICER
TRUST
TRUSTEE/NOTE-OWNER
BORROWER
A foreclosure is rarely commenced under the “Real Entity.” So why do they keep this from us when they knew all along the real parties of interest? This was only discovered during an actual case or we would have never found this.
Coakley begins probe, calls for foreclosure moratorium
By Herald Staff
Saturday, October 2, 2010 –
Massachusetts Attorney General Martha Coakley called on Bank of America and other major creditors to delay all foreclosure proceedings and pledged to begin her own investigation in light of recent revelations that they may not have complied with the law.
Bank of America announced Friday it was delaying foreclosures in 23 states, not including Massachusetts, as it examines whether it rushed the foreclosure process for thousands of homeowners without reading the documents.
“Our office has been extremely active in holding major banks and Wall Street firms accountable during this foreclosure crisis. We are concerned about the revelations that Bank of America and other major lenders have failed to properly review foreclosure documentation,” Coakley said yesterday in a statement. “Our office is now investigating this apparent failure of major creditors to follow state foreclosure law to ensure that Massachusetts homeowners are properly protected. In light of these revelations, we are asking Bank of America and other major creditors to cease foreclosure proceedings for Massachusetts homeowners until they can demonstrate that they have complied with Massachusetts law.”
“They have no personal knowledge of the issue and they are supposed to. That is what these judges rely on when they issue judgments against homeowners,” said Matt Englett, KEL Law Firm.
(I-Newswire) October 2, 2010 – CENTRAL FLORIDA — Thousands of Floridians may soon be rescued from foreclosure. Last week KEL Attorneys filed a motion with the Supreme Court asking Chief Justice Canady for a stay on foreclosure cases being handled by law firms currently under investigation for document fraud.
The State Attorney General launched a formal investigation against Shapiro & Fishman, Marshall Watson and David Stern last month. Lenders hired the three big law firms, which handle 80 percent of all foreclosures in Florida, now accused of fraudulently signing documents to speed up the foreclosure process.
“They have no personal knowledge of the issue and they are supposed to. That is what these judges rely on when they issue judgments against homeowners,” said Matt Englett, KEL Law Firm.
Attorney Matt Englett has testimony from one of the people hired to just sign documentation. He describes a conference room with thousands of documents. He testified he would sign one affidavit after another, taking no more than a minute on each one.
“Time is money. The longer it takes to get the property back and sell the property, the more money they lose on that loan,” Englett said.
Englett hopes the motion will stop wrongful foreclosure it its tracks. He estimates that tens of thousands of homes may have already been wrongfully foreclosed upon, and about 80-percent of pending foreclosure actions contains fraudulent documents.
If Englett is successful, homeowners who have already lost their homes could collect thousands from their lender. And for the hundreds of others in Central Florida in the middle of foreclosure, it would buy time to save their home.
About KEL Attorneys:
Our law firm has had the honor to represent clients all over the country. We are also licensed in federal courts throughout the country and we are able to represent your case in state or federal court. In either venue, rest assured that our law firm will pursue your case aggressively and in the most cost effective manner possible.
We are not just your ordinary law firm, we operate as a full-service law firm that provides legal services nationwide and have a strong presence, with a law firm in Orlando and a law firm in Tampa. Due to size, legal expertise and handling client matters for over ten years, we can handle any legal issue or situation you may have.
Company Contact Information KEL Attorneys
Jennifer Warriner
111 N Magnolia Ave
Suite 1600
32801
Phone : 4075131900
Documents submitted to a court are supposed to be true as submitted. As an attorney, If I file a document with a court in which I swore I personally verified that the information contained within the document is true, and I didn’t actually do that, I’d get in real trouble. It’s simple: That’s fraud in the eyes of the court.
GMAC, JPMorgan Chase and Bank of America recently admitted that their employees routinely sign thousands of documents without verifying what they’re signing. Those documents are then submitted to courts as if the documents were true, to enable the banks to foreclose on delinquent properties. Wells Fargo and CitiMortgage told the New York Times their employees do not engage in similar practices. Yet new evidence shows they do.
Confusion at Wells Fargo
Herman John Kennerty of Wells Fargo has given a deposition describing the department he oversees for Wells Fargo. It’s a department dedicated to simply signing documents. Kennerty testified that he signs 50 to 150 documents a day, verifying only the date on each. What else might he want to verify? Well, in one document he signed, he supposedly transferred the mortgage from Washington Mutual Bank FA to Wells Fargo on July 12, 2010. But that’s impossible, since Washington Mutual Bank FA changed its name in 2004, and by any name WaMu ceased to exist in 2008, when the FDIC took it over. Making the document even less comprehensible, the debtor had declared bankruptcy a month earlier, according to Linda Tirelli, who represented the debtor. Why would Wells Fargo want a mortgage from someone in bankruptcy? Finally, Tirelli pointed out that the papers Wells Fargo filed included a different transfer of the mortgage dated three days before the debtor took out the loan. The documents are a mess, yet Kennerty signed them regardless. Legal Nonsense at CitiMortgage
Similarly, one M. Matthews signed a number of documents that CitiMortgage has used to try to foreclose on properties. While Matthews may or may not sign hundreds of documents a day — I have not yet found a deposition in which he swears that he does — he certainly does not verify the contents of the documents he’s signing. For example, he signed a document supposedly transferring a mortgage from Lehman Brothers to Citi in 2009. It’s hard to see how that’s possible, since Lehman had already ceased to exist. When confronted with its nonsensical filing, Citigroup decided not to foreclose. Instead, it gave the homeowner a meaningful mortgage modification–$15,000 principal reduction, plus a 30 year fixed mortgage at 3%. Tirelli, who represented the debtor in that case too, notes that she sees bad documents in the vast majority of cases, and she keeps files of “robosigned” documents.
It’s true that in both the WaMu and Lehman Brothers documents, the signers were officially representing an entity called MERS and acting as the “nominee” of WaMu and the “nominee” of Lehman Brothers. But that doesn’t change the fraudulent nature of the documents as filed. MERS can’t continue to be the nominee of an entity that doesn’t exist. Moreover, MERS can’t assign something it doesn’t have, and MERS itself will admit it doesn’t own the underlying note or mortgage.
Possible Sanctions for JPMorgan Chase
Wells Fargo and CitiMortgage aren’t the only big banks to misrepresent their practices in the media; JPMorgan Chase told the New York Times that it had not withdrawn any documents in a pending case. However, Chase has in fact withdrawn robosigned documents in a case Tirelli is currently defending. Chase now faces possible sanctions in the case.
Why are the big, sophisticated banks submitting such problematic documents to the courts? The key reason is that sometimes when a bank wants to foreclose, it has to prove it actually has the right to foreclose — that it owns the note and accompanying mortgage. Unfortunately for the banks, the securitization of mortgages and the changes in property ownership documentation that accompanied it make it hard for the banks to establish clean chains of title and produce original documents. Hard, that is, in an environment where a massive number of foreclosures must be started and completed in a timely manner.
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.
The Associated Press
Friday, October 1, 2010; 4:28 PM
WASHINGTON — A Bank of America official acknowledges in a legal proceeding that she signed up to 8,000 foreclosure documents a month and typically didn’t read them.
The executive’s admission adds the nation’s largest bank to a growing list of mortgage companies whose employees signed documents in foreclosure cases without verifying the information in them.
Two other companies, Ally Financial Inc.’s GMAC Mortgage unit and JPMorgan Chase, have halted tens of thousands of foreclosure cases after similar problems became public.
The Bank of America executive said in a February deposition in a Massachusetts bankruptcy case that she signed 7,000 to 8,000 foreclosure documents a month.
“I typically don’t read them because of the volume that we sign,” the executive said.
The disclosure comes two days after JPMorgan said it would temporarily stop foreclosing on more than 50,000 homes so it can review documents that might contain errors. Last week, GMAC halted certain evictions and sales of foreclosed homes in 23 states to review those cases after finding procedural errors in some foreclosure affidavits.
After GMAC’s announcement, state attorneys general in California and Connecticut told the company to stop foreclosures until it proves it’s complying with their state laws. The Ohio attorney general this week asked judges to review GMAC foreclosure cases.
And in Florida, the state attorney general is investigating four law firms, two with ties to GMAC, for allegedly providing fraudulent documents in foreclosure cases.
In some states, lenders can foreclose quickly on delinquent mortgage borrowers. But 23 states use a lengthy court process for foreclosures. They require documents to verify information on the mortgage, including who owns it. Florida, New York, New Jersey and Illinois are the biggest states with this process.
By Ariana Eunjung Cha | October 1, 2010; 2:41 PM ET
Connecticut Attorney General Richard Blumenthal on Friday ordered a moratorium on all foreclosures by all banks for 60 days–the most radical action taken by a state on issue of document irregularities.
California also expanded the moratorium on foreclosures it announced last week on Ally Financial foreclosures to include those by J.P. Morgan Chase.
Calling the companies’ review of key foreclosure documents “a ruse,” California Attorney General Jerry Brown (D) ordered J.P. Morgan to prove it is following the law before it continues foreclosures in the state.
Both J.P. Morgan Chase and Ally have frozen foreclosures in 23 states because some employees had signed off on foreclosure paperwork without properly reviewing the files.
Colorado and Illinois have stopped foreclosures by Ally and at least seven other states have launched probes into the issue. But Connecticut is the first to institute an industry-wide ban.
The attorney general, Richard Blumenthal, also said he is investigating JPMorgan Chase & Co (JPM.N) over its foreclosure practices. He previously said he was investigating Ally Financial Inc and its GMAC Mortgage unit.
“Banks that lured consumers into loans they couldn’t afford now seek to stampede them into foreclosure,” Blumenthal said in a statement. “This freeze should stop a foreclosure steamroller based on defective documents and enable effective remedies.”
The decisions came after borrowers’ lawyers released affidavits suggesting that some lenders’ employees are submitting documentation in foreclosure proceedings without understanding the contents.
Investigators in at least six U.S. states are examining foreclosure practices at GMAC, JPMorgan or both, and calling for such practices to be defended or halted.
Blumenthal, a Democrat, is running for the U.S. Senate. (Reporting by Jonathan Stempel in New York; editing by John Wallace)
Continue to REUTERS
.
Press Release
Attorney General Asks CT Courts To Freeze Home Foreclosures 60 Days Because Of Defective Docs October 1, 2010
Attorney General Richard Blumenthal today asked the state Judicial Department to freeze all home foreclosures for 60 days because of defective document filings and institute measures to assure the integrity of future filings.
Blumenthal made the request after a second bank, JP Morgan Chase, acknowledged filing defective foreclosure documents. Like GMAC/Ally, JP Morgan admitted that so-called “robo-signers” signed affidavits without verifying the information in them. The GMAC robo-signer said under oath that he signed 8,000 to 10,000 foreclosure affidavits a month while a robo-signer for JP Morgan testified to spending less than two minutes on each affidavit.
Blumenthal is investigating GMAC/Ally and JP Morgan, as well as whether other banks may have engaged in similar practices.
Submitting defective documents is a possible fraud upon the court, potentially undermining foreclosures and underlying mortgages.
“This freeze should stop a foreclosure steamroller based on defective documents and enable effective remedies,” Blumenthal said. “The actions of GMAC/Ally and JP Morgan are inexcusable, a possible fraud on the court undermining the integrity of the legal process and consumers’ ability to fight foreclosures. Banks that lured consumers into loans they couldn’t afford now seek to stampede them into foreclosure. We must stop this runaway foreclosure train, restoring proper procedure and property owner rights.
“The Judicial Department should take additional measures — including requiring signers to state the basis for verifying information in affidavits — to restore the integrity of foreclosure documents. This appalling practice must be stopped before it poisons the legal system and unfairly evicts families from their homes.”
See full article from DailyFinance: 
Washington Post
Recent Comments