From WSJ

People close to the investigation cautioned that no decision has been reached on whether to bring civil charges, adding that new evidence still could emerge. Investigators are reviewing thousands of documents turned over to the SEC since it began its probe shortly after Lehman tumbled into bankruptcy in September 2008 and was sold off in pieces. Officials also have questioned a number of former Lehman executives, some of them multiple times, the people said.

But after zeroing in last summer on the battered real-estate portfolio and an accounting move known as Repo 105, SEC officials have grown more worried they could lose a court battle if they bring civil charges that allege Lehman investors were duped by company executives. The key stumbling block: The accounting move, while controversial, isn’t necessarily illegal.

Read the full story if you can stomach it over at the Wall Street Journal

[Image Credit: Reuters]

By Joshua Gallu and Dawn Kopecki – Mar 11, 2011 6:45 PM ET

Fortress Investment Group LLC (FIG) Chief Executive Officer Daniel Mudd received notice from U.S. regulators that he may face claims for misleading investors about Fannie Mae’s exposure to subprime loans when he ran the mortgage firm during the financial crisis.

Mudd, who was ousted when Fannie Mae and Freddie Mac were seized by regulators in September 2008, confirmed in a statement to Bloomberg News that he received the so-called Wells notice from the Securities and Exchange Commission today.

Continue reading… BLOOMBERG

By Graydon Carter

JPMorgan Chase C.E.O. Jamie Dimon is tall. He’s fit. For a banker, he’s nice-looking. And he’s got that head of fluffy white, unbankerish hair. You could argue that Dimon’s single greatest asset is that he doesn’t look like Dick Fuld. Fuld, the former C.E.O. of Lehman Brothers, is a virtual Thomas Nast caricature of the venal banker; all that is missing is the stovepipe hat and the mustache-twirling. Because of his looks, Fuld has probably had a rougher ride of it over the past two and a half years. And because of his looks, Dimon has probably had too easy a ride. While Goldman Sachs C.E.O. Lloyd Blankfein became a piñata for legislators and the press, Dimon fully embraced his role as Wall Street’s fair-haired boy—or “America’s Least-Hated Banker,” as The New York Times Magazine put it just last December.

Continue reading … Vanity Fair

excerpt:

1. Citi’s “Due Diligence” And Early Discovery Of The Risks Of Possible Fraud

61. During the course of Citi’s 2005 initial “due diligence,” and as part of negotiating the final terms of the Prime Fund loan transaction, Citi learned, among other things, that Tremont received only paper copy trade confirmations approximately five (5) days conducted the alleged trading – a practice rife with the possibility for fraud due to the ability of the brokerage firm to backdate or manufacture trading activity with no ability on the customer’s part to check that the trades actually took place.

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FULL TESTIMONY
OHIO ATTORNEY GENERAL MIKE DEWINE
“An Analysis of the Post-Conservatorship Legal Expenses of
Fannie Mae and Freddie Mac”
HOUSE SUBCOMMITTEE HEARING ON
OVERSIGHT AND INVESTIGATIONS
WASHINGTON, DC
FEBRUARY 15, 2011

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Testimony of Michael J. Williams
President and Chief Executive Officer
Fannie Mae
U.S. House of Representatives Committee on Financial Services
Subcommittee on Oversight and Investigations
“Analysis of the Post-Conservatorship Legal Expenses of Fannie Mae and Freddie Mac”
February 15, 2011

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

Statement of
Edward J. DeMarco
Acting Director
Federal Housing Finance Agency
Before the
Committee on Financial Services
Subcommittee on Oversight and Investigations
U.S. House of Representatives
“An Analysis Post-Conservatorship Legal Expenses of Fannie Mae and Freddie Mac”
February 15, 2011

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FOR IMMEDIATE RELEASE
2011-43

Washington, D.C., Feb. 11, 2011 — The Securities and Exchange Commission today charged three former senior executives at IndyMac Bancorp with securities fraud for misleading investors about the mortgage lender’s deteriorating financial condition.

The SEC alleges that former CEO Michael W. Perry and former CFOs A. Scott Keys and S. Blair Abernathy participated in the filing of false and misleading disclosures about the financial stability of IndyMac and its main subsidiary, IndyMac Bank F.S.B. The three executives regularly received internal reports about IndyMac’s deteriorating capital and liquidity positions in 2007 and 2008, but failed to ensure adequate disclosure of that information to investors as IndyMac sold millions of dollars in new stock.

Additional Materials

• SEC Complaint v. Abernathy
• SEC Complaint v. Perry and Keys

IndyMac Bank was a federally-chartered thrift institution regulated by the Office of Thrift Supervision (OTS) and headquartered in Pasadena, Calif. The OTS closed the bank on July 11, 2008, and placed it under Federal Deposit Insurance Corporation (FDIC) receivership. IndyMac filed for bankruptcy protection later that month.

“These corporate executives made false and misleading disclosures about IndyMac at a time when the company’s financial condition was rapidly deteriorating. Truthful and accurate disclosure to investors is particularly critical during a time of crisis, and the federal securities laws do not become optional when the news is negative,” said Lorin L. Reisner, Deputy Director of the SEC’s Division of Enforcement.

According to the SEC’s complaints filed in U.S. District Court for the Central District of California, Perry and Keys defrauded new and existing IndyMac shareholders by making false and misleading statements about IndyMac’s financial condition in its 2007 annual report and in offering materials for the company’s sale of $100 million in new stock to investors. In early February 2008, IndyMac projected that it would return to profitability and continue to pay preferred dividends in 2008 without having to raise new capital. In late February 2008, Perry and Keys knew that contrary to the rosy projections released just two weeks earlier, IndyMac had begun raising new capital to protect IndyMac’s capital and liquidity positions. Specifically, Perry and Keys regularly received information that IndyMac’s financial condition was rapidly deteriorating and authorized new stock sales as a result. Yet they fraudulently failed to fully disclose IndyMac’s precarious financial condition in the 2007 annual report and the offering documents for the new stock sales.

The SEC further alleges that Perry knew that rating downgrades in April 2008 on bonds held by IndyMac Bank had exacerbated its capital and liquidity positions to the extent that IndyMac had no choice but to suspend future preferred dividend payments by no later than May 2, 2008. This material information was not disclosed in IndyMac’s ongoing stock offerings. Perry also failed to disclose in various SEC filings or a May 2008 earnings conference call that IndyMac would not have been “well-capitalized” at the end of its first quarter without departing from its traditional method for risk-weighting subprime assets and backdating an $18 million capital contribution.

According to the SEC’s complaint, Abernathy replaced Keys as IndyMac’s CFO in April 2008. He similarly made false and misleading statements in the offering documents used in selling new IndyMac stock to investors despite regularly receiving internal reports about IndyMac’s deteriorating capital and liquidity positions.

The SEC also alleges that in summer 2007 while serving as IndyMac’s executive vice president in charge of specialty lending, Abernathy made false and misleading statements about the quality of the loans in six IndyMac offerings of residential mortgage-backed securities (RMBS) totaling $2.5 billion. Abernathy received internal reports each month revealing that 12 to 18 percent of IndyMac’s loans contained misrepresentations regarding important loan and borrower characteristics. However, the RMBS offering documents stated that nothing had come to IndyMac’s attention that any loan included in the offering contained a misrepresentation. The SEC alleges that Abernathy failed to ensure that the quality of IndyMac’s loans was accurately disclosed and failed to disclose that information had come to IndyMac’s attention about loans containing misrepresentations.

Abernathy agreed to settle the SEC’s charges without admitting or denying the allegations. He consented to the entry of an order that permanently restrains and enjoins him from violating Section 17(a)(2) and 17(a)(3) of the Securities Act and requires him to pay a $100,000 penalty, $25,000 in disgorgement, and prejudgment interest of $1,592.26. Abernathy also consented to the issuance of an administrative order pursuant to Rule 102(e) of the SEC’s Rules of Practice, suspending him from appearing or practicing before the SEC as an accountant. He has the right to apply for reinstatement after two years.

The SEC’s complaint charges Perry and Keys with knowingly violating the antifraud provisions of Section 17(a) of the Securities Act of 1933 and Section 10(b) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder, and aiding and abetting IndyMac’s violations of its periodic reporting requirements under Section 13(a) of the Exchange Act and Rules 12b-20 and 13a-1 thereunder. Perry also is charged with aiding and abetting IndyMac’s reporting violations under Exchange Act Rules 13a-11 and 13a-13. The SEC’s complaint against Perry and Keys seeks permanent injunctive relief, an officer and director bar, disgorgement of ill-gotten gains with prejudgment interest, and a financial penalty.

The SEC acknowledges the assistance of the FDIC in this investigation.

# # #

For more information about this enforcement action, contact:

John M. McCoy III
Associate Regional Director, SEC’s Los Angeles Regional Office
(323) 965-4573

Kelly Bowers
Senior Assistant Regional Director, SEC’s Los Angeles Regional Office
(323) 965-3924

Donald W. Searles
Senior Trial Counsel, SEC’s Los Angeles Regional Office
(323) 965-4573

http://www.sec.gov/news/press/2011/2011-43.htm

October 18, 2004

When Wall Street’s biggest firms settled with regulators in April 2003 over charges of fraudulent stock research, the industry promised a new era of independence. Marc Lackritz, president of the Securities Industry Association, promised Wall Street would ensure that “the quality and integrity of financial analysis is beyond reproach.”

The recent highly critical report by federal regulators on Fannie Mae’s accounting practices, though, may rekindle questions about Wall Street’s ability to issue unbiased research. Fannie is one of Wall Street’s best clients, issuing close to $2 trillion in debt to provide cheap loans for home buyers, and those figures don’t include other huge fees Wall Street earns in helping Fannie. Fannie’s top five underwriters have earned close to $700 million in fees since 1999, according to Thomson Financial. Those same firms have provided continuing upbeat assessments despite growing signs Fannie was facing financial difficulties. Merrill Lynch, Fannie’s largest underwriter, maintained its “buy” rating last week. A Merrill spokesman said the firm’s research is objective, adding: “Our buy rating is in line with the consensus of research on this company.” Other leading underwriters–Goldman Sachs, Lehman Brothers, Morgan Stanley, and JPMorgan–declined to comment.

By GRETCHEN MORGENSON
Published: October 3, 2004

IT is literally a trillion-dollar question: What will a humbled, reined-in Fannie Mae, the nation’s biggest mortgage provider, mean to the economy, the financial markets, interest rates and housing in America?

Since regulators disclosed evidence of widespread accounting improprieties at the company, which carries almost $1 trillion in mortgages on its books, the response from the financial markets has been surprisingly muted. To be sure, Fannie Mae’s stock has lost 14 percent of its value, but its debt securities have held fairly steady and the pools of mortgages it sells to investors have continued to attract buyers.

Even if Fannie Mae’s troubles are eventually worked out, there may be other, potentially nasty reverberations from the company’s weakened position. These include a possible hit to the dollar if foreign investors, who have bought so much of the company’s debt, become alarmed by the accounting problems and sell.

James A. Bianco of Bianco Research in Chicago, said he thinks foreigners might well cut back on their Fannie Mae debt holdings, as they seem to have done when Freddie Mac, another government-sponsored enterprise in the mortgage business, had its own accounting problems last year. ”If Freddie spooked foreigners, the Fannie scandal will exacerbate the trend,” he said.

In addition, Fannie Mae’s woes could work against the Federal Reserve Board as it moves to keep inflation in check by raising interest rates. If the company, under heightened scrutiny, decides that it must manage its interest rate risk more aggressively, it would have to buy huge amounts of Treasury securities. Doing so would push rates down further, creating a vicious cycle in which more homeowners refinance their mortgages, leaving Fannie Mae with a larger mismatch between the longer-term debt they have issued to buy the mortgages and the shorter-lived mortgages themselves.

by Allan Dodds Frank

The allegations unveiled Thursday by the trustee amount to accusing the senior management of the bank (without naming anyone) of ignoring the public good to protect profits—and Bernie. Back when the complaint was under seal, Picard’s No. 1 counsel David Sheehan had asserted: “JPMorgan was willfully blind to the fraud, even after learning about numerous red flags surrounding Madoff.” In his statement, Sheehan said: “JPMC was at the very center of that fraud, and thoroughly complicit in it.” At the time, the bank called the trustee “irresponsible” and said the complaint was aimed at “headline-grabbing.”

For its part, JPMorgan Chase said Thursday that the bankruptcy trustee’s complaint is “based on distortions of both the relevant facts and the governing law. Contrary to the trustee’s allegation, JPMorgan did not know about or in any way become a party to the fraud orchestrated by Bernard Madoff.”

The statement continued:

“Madoff’s firm was not an important or significant customer in the context of JPMorgan’s commercial banking business, and the revenues earned from Madoff’s bank account were modest and entirely consistent with conventional market rates and fees.” The statement added that the trustee’s claims that the bank earned big bucks from Madoff “is demonstrably false.”

The bank’s statement made no mention of the supposed First Rule of Banking: “Know Your Customer.”

My simultaneous translation of the JPMorgan statement is this: “We are such a giant global bank that whatever profits we made from Madoff are chump change. A settlement would not affect earnings, even though we have to stipulate that we administered the accounts Bernie used to carry out the largest Ponzi fraud in history, and even though we neither admit nor deny turning a blind eye to his machinations and making hundreds of millions in the process.”

Where are the Handcuffs?

Earlier today, I did a podcast with Shahien Nasiripour from the Huffington Post on the current state of the justice system in America.  The full transcript is on it’s way.

NEW YORK — After the last major banking crisis, some two decades ago, roughly 3,800 bankers were prosecuted and sentenced to prison terms, by the Justice Department’s count. Yet this time, some four years after the economy descended into the most punishing financial crisis since the Great Depression, the public still waits for the Obama administration to deliver a similar kind of justice.

The 2007-’09 financial crisis was “avoidable,” a bipartisan, congressionally-appointed panel concluded last week. Mortgage fraud “flourished” in the run up to the collapse. Securities fraud was apparently widespread.

“Lenders made loans that they knew borrowers could not afford and that could cause massive losses to investors in mortgage securities,” the Financial Crisis Inquiry Commission wrote in its report on the causes of the collapse. About $1 trillion worth of home loans made from 2005 to 2007 were “fraudulent,” the commission said, citing testimony from experts. The Illinois Attorney General, Lisa Madigan, told the commission that she defined fraud to include lenders’ “sale of unaffordable or structurally-unfair mortgage products to borrowers.”

And yet, the perp walk so many Americans crave — Treasury Secretary Timothy Geithner once referred to it as the “very deep public desire for Old Testament justice” — hasn’t occurred. Wall Street figures have largely gone untouched. Bank directors kept their jobs. In a sign that perhaps the fallout from the crisis has passed, outsized compensation is back.

“People need to go to jail,” said Liz Ryan Murray, policy director of National People’s Action, an advocacy organization that helped launch the website CrimeShouldntPay.com. “If you steal something, you go to jail. If you falsify documents, you go to jail. Why doesn’t that apply to big bank executives?”

Amended Complaint against all defendants / Complaint against JPMorgan Chase & Co., JPMorgan Chase Bank, N.A., J.P. Morgan Securities LLC, J.P. Morgan Securities Ltd. [Redacted] (related document(s) 1 ) Filed by Deborah H. Renner on behalf of Irving H. Picard, Trustee for the Liquidation of Bernard L. Madoff Investment Securities LLC. (Renner, Deborah) (Entered: 02/03/2011)

source: BMI Trustee

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And so it begins. We’re about to witness the main event in financial institution internecine warefare: investment funds (MBS buyers) vs. banks (MBS sellers).

There have already been some opening skirmishes. The monoline bond insurers (MBIA, Syncora, FGIC, Ambac (and here), CIFG (and here), and–I haven’t found any litigation with them on this, but there’s gotta be some–ACA) have been litigating against some of the banks whose securitizations they insured for various fraud, negligent misrepresentation, and breach of warranty claims. Many of the Federal Home Loan Banks (Chicago, Indianapolis, Pittsburgh, San Francisco, Seattle, maybe others that I don’t recall of the top of my head), which slurped up RMBS during the bubble, only to find them toxic, have brought (separate) suits mainly on securities fraud charges, but also on common law fraud and negligent misrepresentation claims. (See here for a totally dated, August 2010 estimation of the liabilities in these suits.)

Then last fall the financial world was shaken by the New York Fed, BlackRock, and PIMCO’s demand letter to Bank of New York Mellon and Countrywide. That showed that A-list financial institutions were taking the range of problems with RMBS, from representation and warranty breaches to servicer malfeasance, seriously. (You can see the NY Fed, acting for the Maiden Lane LLCs, as really another representing AIG, essentially the mother of all monolines for these purposes.) But that wasn’t litigation proper, just an angry growl, with a threat of litigation if things weren’t resolved. (When you see the letterhead for the response, you’ll see that BoA/CW is taking this mighty seriously. Despite the typo in that snippy letter, it didn’t come cheap. These guys are lawyering up.)

By GRETCHEN MORGENSON
Published: January 24, 2011

Since the government took over Fannie Mae and Freddie Mac, taxpayers have spent more than $160 million defending the mortgage finance companies and their former top executives in civil lawsuits accusing them of fraud. The cost was a closely guarded secret until last week, when the companies and their regulator produced an accounting at the request of Congress.

The bulk of those expenditures — $132 million — went to defend Fannie Mae and its officials in various securities suits and government investigations into accounting irregularities that occurred years before the subprime lending crisis erupted. The legal payments show no sign of abating.

Documents reviewed by The New York Times indicate that taxpayers have paid $24.2 million to law firms defending three of Fannie’s former top executives: Franklin D. Raines, its former chief executive; Timothy Howard, its former chief financial officer; and Leanne Spencer, the former controller.

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[Read Complaint Below]

PRESS RELEASES

Saxena White P.A. Files Securities Fraud Class Action Against Lender Processing Services, Inc.

Boca Raton, January 12, 2011

Boca Raton, FL, January 12, 2011:  In recent months, various government investigations and media reports on mortgage service companies have exposed an industry that increasingly relied on deceptive and fraudulent business practices, including the use of so-called “robo-signers” that falsified mortgage ownership documents.  Lender Processing Services, Inc. (“LPS” or the “Company”), a mortgage servicer based in Jacksonville, Florida, is one of the companies facing government scrutiny.

In connection with the Florida Attorney General’s investigation into the Company, former Florida AG Bill McCollum has indicated that LPS and other similar companies have produced “numerous documents in foreclosure cases that appear to be fabricated.”  As a result of the rampant use of these and other unscrupulous business practices, investors have suffered millions of dollars in losses.

Saxena White P.A. has filed a class action lawsuit for an institutional investor in the United States District Court for the Middle District of Florida on behalf of all investors who purchased LPS securities during the period between July 29, 2009 and October 4, 2010, inclusive (the “Class Period”), seeking to recover damages caused by defendants’ violations of the federal securities laws.

The complaint alleges that, throughout the Class Period, defendants failed to disclose material adverse facts about the Company’s true financial condition, business and prospects. Specifically, the complaint alleges that defendants failed to disclose: (i) that the Company had engaged in improper and deceptive business practices; (ii) that a subsidiary of LPS, Docx, had been falsifying mortgage documents through the use of “robo-signers”; (iii) that the Company had engaged in improper fee sharing arrangements with foreclosure law firms, including the use of undisclosed contractual arrangements for impermissible legal fee splitting, which are camouflaged as various types of fees; and (iv) that as a result of the Company’s deceptive business practices, LPS reported materially false and misleading financial results.

On October 4, 2010, after continued media reports and various government investigations calling into question LPS’s default-related services that it provides to mortgage lenders, the market price of LPS stock fell $2.72, or 8.6% per share, to close at $28.76 per share. The price of LPS stock fell another $1.45, or 5.04%, on October 5, 2010, to close at $27.31 per share, on unusually heavy trading volume.

You may obtain a copy of the complaint and join the class action at www.saxenawhite.com.  If you purchased LPS stock between July 29, 2009 and October 4, 2010, you may contact Joe White or Greg Stone at Saxena White P.A. to discuss your rights and interests:

Joseph E. White, III                       Greg Stone
jwhite@saxenawhite.com                gstone@saxenawhite.com

Saxena White P.A.
2424 North Federal Highway, Suite 257
Boca Raton, FL 33431
Tel: (561) 394-3399
Fax: (561) 394-3382
www.saxenawhite.com

If you purchased LPS shares during the Class Period and wish to apply to be the lead plaintiff in this action, a motion on your behalf must be filed with the Court no later than January 24, 2011.  You may contact Saxena White P.A. to discuss your rights regarding the appointment of lead plaintiff and your interest in the class action.  Please note that you may also retain counsel of your choice and need not take any action at this time to be a class member.

Saxena White P.A., which has offices in Boca Raton, Boston and Montana, specializes in prosecuting securities fraud and complex class actions on behalf of institutions and individuals.  Currently serving as lead counsel in numerous securities fraud class actions nationwide, the firm has recovered hundreds of millions of dollars on behalf of injured investors and is active in major litigation pending in federal and state courts throughout the United States.

Continue to complaint below…

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Richard (RJ) Eskow

Consultant, Writer, Senior Fellow with The Campaign for America’s Future
Posted: December 30, 2010 04:58 PM

Bankers. The red carpet’s still being rolled out for them in Washington, but if there’s a stain on it they’ll pout for days. Jason Linkins documents the latest set of cheap white whines from very wealthy white men. (Discrimination lawsuits are a routine part of their legal troubles, too.) This time they’re upset because nobody from the six largest banks in America was invited to the president’s CEO Roundtable.

They’re offended because they didn’t meet with the president? From the looks of things they’re lucky not to be meeting with the warden. Their collective rap sheet includes fraud, sex discrimination, collusion to bribe public officials… even laundering drug money for Mexican drug cartels. One of them is accused of ripping off some nuns! None of this criminal behavior has stopped them from sulking over a presidential slight. Let’s review the record for these corporate malefactors, and then decide:

Which of these six banks was “America’s Most Shameless Corporate Outlaw” in 2010? (I mean, really: Nuns?)

MERS is an artifice and they are going to blow up!

Read this carefully…Judge Schack knows exactly where this is going and where he is taking it!

Decided on August 25, 2010

The Bank of New York, AS TRUSTEE FOR THE CERTIFICATEHOLDERS CWALT, INC. ALTERNATIVE LOAN TRUST 2006-OC1 MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC1, Plaintiff,

against

Denise Mulligan, BEVERLY BRANCHE, et. al., Defendants.

Plaintiff:
McCabe Weisberg Conway PC
Jason E. Brooks, Esq.
New Rochelle NY

Defendant:
No Appearances.

Arthur M. Schack, J.

Plaintiff’s renewed application, upon the default of all defendants, for an order of reference for the premises located at 1591 East 48th Street, Brooklyn, New York (Block 7846, Lot 14, County of Kings) is denied with prejudice. The complaint is dismissed. The notice of pendency filed against the above-named real property is cancelled.

In my June 3, 2008 decision and order in this matter, I granted leave to plaintiff, THE BANK OF NEW YORK, AS TRUSTEE FOR THE CERTIFICATEHOLDERS CWALT, INC. ALTERNATIVE LOAN TRUST 2006-OC1 MORTGAGE PASS-THROUGH CERTIFICATES, [*2]SERIES 2006-OC1 (BNY), to renew its application for an order of reference within forty-five (45) days, until July 18, 2008, if it complied with three conditions. However, plaintiff did not make the instant motion until May 4, 2009, 335 days after June 3, 2008, and failed to offer any excuse for its lateness. Therefore, the instant motion is 290 days, almost ten months, late. Further, the instant renewed motion failed to present the three affidavits that this Court ordered plaintiff BNY to present with its renewed motion for an order of reference: (1) an affidavit of facts either by an officer of plaintiff BNY or someone with a valid power of attorney from plaintiff BNY and personal knowledge of the facts; (2) an affidavit from Ely Harless describing his employment history for the past three years, because Mr. Harless assigned the instant mortgage as Vice President of MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. (MERS) and then executed an affidavit of merit for assignee BNY as Vice President of BNY’s alleged attorney-in-fact without any power of attorney; and, (3) an affidavit from an officer of plaintiff BNY explaining why it purchased the instant nonperforming loan from MERS, as nominee for DECISION ONE MORTGAGE COMPANY, LLC (DECISION ONE).

Moreover, after I reviewed the papers filed with this renewed motion for an order of reference and searched the Automated City Register Information System (ACRIS) website of the Office of the City Register, New York City Department of Finance, I discovered that plaintiff BNY lacked standing to pursue the instant action for numerous reasons. Therefore, the instant action is dismissed with prejudice.

Background

Defendant DENISE MULLIGAN (MULLIGAN) borrowed $392,000.00 from

DECISION ONE on October 28, 2005. The mortgage to secure the note was recorded by MERS, “acting solely as a nominee for Lender [DECISION ONE]” and “FOR PURPOSES OF RECORDING THIS MORTGAGE, MERS IS THE MORTGAGEE OF RECORD,” in the Office of the City Register of the City of New York, New York City Department of Finance, on February 6, 2006, at City Register File Number (CRFN) 2006000069253.

Defendant MULLIGAN allegedly defaulted in her mortgage loan payments with her May 1, 2007 payment. Subsequently, plaintiff BNY commenced the instant action, on August 9, 2007, alleging in ¶ 8 of the complaint, and again in ¶ 8 of the August 16, 2007 amended complaint, that “Plaintiff [BNY] is the holder of said note and mortgage. said mortgage was assigned to Plaintiff, by Assignment of Mortgage to be recorded in the Office of the County Clerk of Kings County [sic].” As an aside, plaintiff’s counsel needs to learn that mortgages in New York City are not recorded in the Office of the County Clerk, but in the Office of the City Register of the City of New York. However, the instant mortgage and note were not assigned to plaintiff BNY until October 9, 2007, 61 days subsequent to the commencement of the instant action, by MERS, “as nominee for Decision One,” and executed by Ely Harless, Vice President of MERS. This assignment was recorded on October 24, 2007, in the Office of the City Register of the City of New York, at CRFN 2007000537531.

I denied the original application for an order of reference, on June 3, 2008, with leave to renew, because assignor Ely Harless also executed the March 20, 2008-affidavit of merit as Vice President and “an employee of Countrywide Home Loans, Inc., attorney-in-fact for Countrywide Home Loans, Inc.” The original application for an order of reference did not present any power of attorney from plaintiff BNY to Countrywide Home Loans, Inc. Also, the Court pondered how [*3]Countrywide Home Loans, Inc. could be its own an attorney-fact?

In my June 3, 2008 decision and order I noted that Real Property Actions and Proceedings Law (RPAPL) § 1321 allows the Court in a foreclosure action, upon the default of defendant or defendant’s admission of mortgage payment arrears, to appoint a referee “to compute the amount due to the plaintiff” and plaintiff BNY’s application for an order of reference was a preliminary step to obtaining a default judgment of foreclosure and sale. (Home Sav. Of Am., F.A. v Gkanios, 230 AD2d 770 [2d Dept 1996]). However, plaintiff BNY failed to meet the clear requirements of CPLR § 3215 (f) for a default judgment, which states:

On any application for judgment by default, the applicant shall file proof of service of the summons and the complaint, or a summons and notice served pursuant to subdivision (b) of rule 305 or subdivision (a) of rule 316 of this chapter, and proof of the facts constituting the claim, the default and the amount due by affidavit made by the party . . . Where a verified complaint has been served, it may be used as the affidavit of the facts constituting the claim and the amount due; in such case, an affidavit as to the default shall be made by the party or the party’s attorney. [Emphasisadded].

Plaintiff BNY failed to submit “proof of the facts” in “an affidavit made by the party.” (Blam v Netcher, 17 AD3d 495, 496 [2d Dept 2005]; Goodman v New York City Health & Hosps. Corp. 2 AD3d 581[2d Dept 2003]; Drake v Drake, 296 AD2d 566 [2d Dept 2002]; Parratta v McAllister, 283 AD2d 625 [2d Dept 2001]; Finnegan v Sheahan, 269 AD2d 491 [2d Dept 2000]; Hazim v Winter, 234 AD2d 422 [2d Dept 1996]). Instead, plaintiff BNY submitted an affidavit of merit and amount due by Ely Harless, “an employee of Countrywide Home Loans, Inc.” and failed to submit a valid power of attorney for that express purpose. Also, I required that if plaintiff renewed its application for an order of reference and provided to the Court a valid power of attorney, that if the power of attorney refers to a servicing agreement, the Court needs a properly offered copy of the servicing agreement to determine if the servicing agent may proceed on behalf of plaintiff. (EMC Mortg. Corp. v Batista, 15 Misc 3d 1143 (A), [Sup Ct, Kings County 2007]; Deutsche Bank Nat. Trust Co. v Lewis, 14 Misc 3d 1201 (A) [Sup Ct, Suffolk County 2006]).

I granted plaintiff BNY leave to renew its application for an order of reference within forty-five (45) days of June 3, 2008, which would be July 18, 2008. For reasons unknown to the Court, plaintiff BNY made the instant motion to renew its application for an order of reference on May 4, 2009, 290 days late. Plaintiff’s counsel, in his affirmation in support of the renewed motion, offers no explanation for his lateness and totally ignores this issue.

Further, despite the assignment by MERS, as nominee for DECISION ONE, to plaintiff BNY occurring 61 days subsequent to the commencement of the instant action, plaintiff’s counsel claims, in ¶ 17 of his affirmation in support, that “[s]aid assignment of mortgage [by MERS, as nominee for DECISION ONE to BNT] was drafted for the convenience of the court in establishing the chain of ownership, but the actual assignment and transfer had previously occurred by delivery.” The alleged proof presented of physical delivery of the subject MULLIGAN mortgage is a computer printout [exhibit G of motion], dated April 30, 2009, from [*4]Countrywide Financial, which plaintiff’s counsel calls a “Closing Loan Schedule,” and claims, in ¶ 21 of his affirmation in support, that this “closing loan schedule is the mortgage loan schedule displaying every loan held by such trust at the close date for said trust at the end of January 2006. The closing loan schedule is of public record and demonstrates that the Plaintiff was in possession of the note and mortgage about nineteen (19) months prior to the commencement of this action.” There is an entry on line 2591 of the second to last page of the printout showing account number 1232268089, which plaintiff’s counsel, in ¶ 22 of his affirmation in support, alleges is the subject mortgage. Plaintiff’s counsel asserts, in ¶ 23 of his affirmation in support, that “[t]he annexed closing loan schedule suffices to proceed in granting Plaintiff’s Order of Reference in this matter proving possession prior to any default.” This claim is ludicrous. The computer printout, printed on April 30, 2009, just prior to the making of the instant motion, has no probative value with respect to whether physical delivery of the subject mortgage was made to plaintiff BNY prior to the August 9, 2007 commencement of the instant action.

Further, even if the mortgage was delivered to BNY prior to the August 9, 2007 commencement of the instant action, this claim is in direct contradiction to plaintiff’s claim previously mentioned in ¶ 8 of both the complaint and the amended complaint, that “Plaintiff [BNY] is the holder of said note and mortgage. said mortgage was assigned to Plaintiff, by Assignment of Mortgage to be recorded in the Office of the County Clerk of Kings County [sic].” Both ¶’s 8 allege that the assignment of the subject mortgage took place prior to August 9, 2007 and the recording would subsequently take place. The only reality for the Court is that the assignment of the subject mortgage took place 61 days subsequent to the commencement of the action on October 9, 2007 and the assignment was recorded on October 24, 2007.

Moreover, plaintiff’s counsel alleges, in ¶ 18 of his affirmation in support, that “[p]ursuant to a charter between Mortgage Electronic Registrations Systems, Inc. ( MERS’) and Decision One Mortgage Company, LLC, all officers of Decision One Mortgage Company, LLC, a member of MERS, are appointed as assistant secretaries and vice presidents of MERS, and as such are authorized” to assign mortgage loans registered on the MERS System and execute documents related to foreclosures. ¶ 18 concludes with “See Exhibit F.” None of this appears in exhibit F. Exhibit F is a one page power of attorney from “THE BANK OF NEW YORK, as Trustee” pursuant to unknown pooling and servicing agreements appointing “Countrywide Home Loans Servicing LP and its authorized officers (collectively CHL Servicing’)” as its “attorneys-in-fact and authorized agents” for foreclosures “in connection with the transactions contemplated in those certain Pooling and Servicing Agreements.” The so-called “charter” between MERS and DECISION ONE was not presented to the Court in any exhibits attached to the instant motion.

Further, attached to the instant renewed motion [exhibit D] is an affidavit of merit

by Keri Selman, dated August 23, 2007 [47 days before the assignment to BNY], in which Ms. Selman claims to be “a foreclosure specialist of Countrywide Home Loans, Inc. Servicing agent for BANK OF NEW YORK, AS TRUSTEE FOR THE CERTIFICATEHOLDERS CWALT, INC. ALTERNATIVE LOAN TRUST 2006-OC1 MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC1 . . . I make this afidavit upon personal knowledge based on books and records of Bank of New York in my possession or subject to my control [sic]” Countrywide Home Loans, Inc. is not Countrywide Home Loans Servicing LP, referred to in the power of attorney attached to the renewed motion [exhibit F]. Moreover, plaintiff failed to [*5]present to the Court any power of attorney authorizing Ms. Selman to execute for Countrywide Home Loans, Inc. her affidavit on behalf of plaintiff BNY. Also, Ms. Selman has a history of executing documents presented to this Court while wearing different corporate hats. In Bank of New York as Trustee for Certificateholders CWABS, Inc. Asset-Backed Certificates, Series 2006-22 v Myers (22 Misc 3d 1117 [A] [Sup Ct, Kings County 2009], in which I issued a decision and order on February 3, 2009, Ms. Selman assigned the subject mortgage on June 28, 2008 as Assistant Vice President of MERS, nominee for Homebridge Mortgage Bankers Corp., and then five days later executed an affidavit of merit as Assistant Vice President of plaintiff BNY. I observed, in this decision and order, at 1-2, that:

Ms. Selman is a milliner’s delight by virtue of the number of hats she wears. In my November 19, 2007 decision and order (BANK OF NEW YORK A TRUSTEE FOR THE NOTEHOLDERS OF CWABS, INC. ASSET-BACKED NOTES, SERIES 2006-SD2 v SANDRA OROSCONUNEZ, et. al. [Index No., 32052/07]),

I observed that:

Plaintiff’s application is the third application for an order of reference received by me in the past several days that contain an affidavit from Keri Selman. In the instant action, she alleges to be an Assistant Vice President of the Bank of New York. On November 16, 2007, I denied an application for an order of reference (BANK OF NEW YORK A TRUSTEE FOR THE CERTIFICATEHOLDERS OF CWABS, INC. ASSET-BACKED CERTIFICATES, SERIES 2006-8 v JOSE NUNEZ, et. al., Index No. 10457/07), in which Keri Selman, in her affidavit of merit claims to be “Vice President of  COUNTRYWIDE HOME LOANS, Attorney in fact for BANK OF NEW YORK.” The Court is concerned that Ms. Selman might be engaged in a subterfuge, wearing various corporate hats. Before granting an application for an order of reference, the Court requires an affidavit from Ms. Selman describing her employment history for the past three years. This Court has not yet received any affidavit from Ms. Selman describing her employment history, whether it is with MERS, BNY, COUNTRYWIDE HOME LOANS, or any other entity. [*6]

Further, the Court needs to address the conflict of interest in the June 20, 2008 assignment by Ms. Selman to her alleged employer, BNY.

I am still waiting for Ms. Selman’s affidavit to explain her tangled employment relationships. Interestingly, Ms. Selman, as “Assistant Vice President of MERS,” nominee for “America’s Wholesale Lender,” is the assignor of another mortgage to plaintiff BNY in Bank of New York v Alderazi (28 Misc 3d 376 [Sup Ct, Kings County 2010]), which I further cite below.

It is clear that plaintiff BNY failed to provide the Court with: an affidavit of merit by an officer of plaintiff BNY or someone with a valid power of attorney from BNY; an affidavit from Ely Harless, explaining his employment history; and, an explanation from BNY of why it purchased a nonperforming loan from MERS, as nominee of DECISION ONE. Moreover, plaintiff BNY did not own the subject mortgage and note when the instant case commenced. Even if plaintiff BNY owned the subject mortgage and note when the case commenced, MERS lacked the authority to assign the subject MULLIGAN mortgage to BNY, as will be explained further. Plaintiff’s counsel offers a lame and feeble excuse for not complying with my June 3, 2008 decision and order, in ¶ 23 of his affirmation in support, claiming that “[t]he affidavits requested in Honorable Arthur M. Schack’s Decision and Order should not be required, given the annexed closing loan schedule.”

Plaintiff BNY lacked standing

The instant action must be dismissed because plaintiff BNY lacked standing to bring this action on August 9, 2007, the day the action commenced. “Standing 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.” (Saratoga County Chamber of Commerce, Inc. v Pataki, 100 NY2d 801 812 [2003], cert denied 540 US 1017 [2003]). Professor Siegel (NY Prac, § 136, at 232 [4d ed]), instructs that:

[i]t is the law’s policy to allow only an aggrieved person to bring a lawsuit . . . A want of “standing to sue,” in other words, is just another way of saying that this particular plaintiff is not involved in a genuine controversy, and a simple syllogism takes us from there to a “jurisdictional”

dismissal: (1) the courts have jurisdiction only over controversies; (2) a plaintiff found to lack “standing”is not involved in a controversy; and (3) the courts therefore have no jurisdiction of the case when such a plaintiff purports to bring it.

“Standing 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.” (Caprer v Nussbaum (36 AD3d 176, 181 [2d Dept 2006]). If a plaintiff lacks standing to sue, the plaintiff may not proceed in the action. (Stark v Goldberg, 297 AD2d 203 [1st Dept 2002]). [*7]

Plaintiff BNY lacked standing to foreclose on the instant mortgage and note when this action commenced on August 7, 2007, the day that BNY filed the summons, complaint and notice of pendency with the Kings County Clerk, because it did not own the mortgage and note that day. The instant mortgage and note were assigned to BNY, 61 days later, on October 7, 2007. The Court, in Campaign v Barba (23 AD3d 327 [2d Dept 2005]), instructed 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 Witelson v Jamaica Estates Holding Corp. I, 40 AD3d 284 [1st Dept 2007]; 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 Trustee 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]).

Assignments of mortgages and notes are made by either written instrument or the assignor physically delivering the mortgage and note to the assignee.

“Our courts have repeatedly held that a bond and mortgage may be transferred by delivery without a written instrument of assignment.” (Flyer v Sullivan, 284 AD 697, 699 [1d Dept 1954]). The written October 7, 2007 assignment by MERS, as nominee for DECISION ONE, to BNY is clearly 61 days after the commencement of the action. Plaintiff’s BNY’s claim that the gobblygook computer printout it offered in exhibit G is evidence of physical delivery of the mortgage and note prior to commencement of the action is not only nonsensical, but flies in the face of the complaint and amended complaint, which both clearly state in ¶ 8 that “Plaintiff [BNY] is the holder of said note and mortgage. said mortgage was assigned to Plaintiff, by Assignment of Mortgage to be recorded in the Office of the County Clerk of Kings County [sic].” Plaintiff BNY did not own the mortgage and note when the instant action commenced on August 7, 2007.

“[A] retroactive assignment cannot be used to confer standing upon the assignee in a foreclosure action commenced prior to the execution of an assignment.”

(Wells Fargo Bank, N.A. v Marchione, 69 AD3d 204, 210 [2d Dept 2009]). The Marchione Court relied upon LaSalle Bank Natl. Assoc. v Ahearn (59 AD3d 911 [3d Dept 2009], which instructed, at 912, “[n]otably, foreclosure of a mortgage may not be brought by one who has no title to it’ (Kluge v Fugazy, 145 AD2d 537 [2d Dept 1988]) and an assignee of such a mortgage does not have standing unless the assignment is complete at the time the action is commenced).” (See U.S. Bank, N.A. v Collymore, 68 AD3d 752 [2d Dept 2009]; Countrywide Home Loans, Inc. v Gress, 68 AD3d 709 [2d Dept 2009]; Citgroup Global Mkts. Realty Corp. v Randolph Bowling, 25 Misc 3d 1244 [A] [Sup Ct, Kings County 2009]; Deutsche Bank Nat. Trust Company v Abbate, 25 Misc 3d 1216 [A] [Sup Ct, Richmond County 2009]; Indymac Bank FSB v Boyd, 22 Misc 3d 1119 [A] [Sup Ct, Kings County 2009]; Credit-Based Asset Management and Securitization, LLC v Akitoye,22 Misc 3d 1110 [A] [Sup Ct, Kings County Jan. 20, 2009]; Deutsche Bank Trust Co. Americas v Peabody, 20 Misc 3d 1108 [A][Sup Ct, Saratoga County 2008]).

The Appellate Division, First Department, citing Kluge v Fugazy, in Katz v East-Ville Realty Co., (249 AD2d 243 [1d Dept 1998]), instructed 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 [*8]fact.” Therefore, with plaintiff BNY not having standing, the Court lacks jurisdiction in this foreclosure action and the instant action is dismissed with prejudice.

MERS had no authority to assign the subject mortgage and note

Moreover, MERS lacked authority to assign the subject mortgage. The subject DECISION ONE mortgage, executed on October 28, 2005 by defendant MULLIGAN, clearly states on page 1 that “MERS is a separate corporation that is acting solely as a nominee for Lender [DECISION ONE] and LENDER’s successors and assigns . . . FOR PURPOSES OF RECORDING THIS MORTGAGE, MERS IS THE MORTGAGEE OF RECORD.”

The word “nominee” is defined as “[a] person designated to act in place of another, usu. in a very limited way” or “[a] party who holds bare legal title for the benefit of others.” (Black’s Law Dictionary 1076 [8th ed 2004]). “This definition suggests that a nominee possesses few or no legally enforceable rights beyond those of a principal whom the nominee serves.” (Landmark National Bank v Kesler, 289 Kan 528, 538 [2009]). The Supreme Court of Kansas, in Landmark National Bank, 289 Kan at 539, observed that:

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. See In re Sheridan, 2009 WL631355, at *4 (Bankr. D.

Idaho, March 12, 2009) (MERS “acts not on its own account. Its capacity is representative.”); Mortgage Elec. Registrations Systems, Inc. v Southwest, 2009 Ark. 152 ___, ___SW3d___, 2009 WL 723182 (March 19, 2009) (“MERS, by the terms of the deed of trust, and its own stated purposes, was the lender’s agent”); La Salle Nat. Bank v Lamy, 12 Misc 3d 1191 [A], at *2 [Sup Ct, Suffolk County 2006]) . . .

(“A nominee of the owner of a note and mortgage may not effectively assign the note and mortgage to another for want of an ownership interest in said note and mortgage by the nominee.”)

The New York Court of Appeals in MERSCORP, Inc. v Romaine (8 NY3d 90 [2006]), explained how MERS acts as the agent of mortgagees, holding at 96:

In 1993, the MERS system was created 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 [*9] MERS to act as their common agent on all mortgages they register in the MERS system. [Emphasis added]

Thus, it is clear that MERS’s relationship with its member lenders is that of agent with the lender-principal. This is a fiduciary relationship, resulting from the manifestation of consent by one person to another, allowing the other to act on his behalf, subject to his control and consent. The principal is the one for whom action is to be taken, and the agent is the one who acts.It has been held that the agent, who has a fiduciary relationship with the principal, “is a party who acts on behalf of the principal with the latter’s express, implied, or apparent authority.” (Maurillo v Park Slope U-Haul, 194 AD2d 142, 146 [2d Dept 1992]). “Agents are bound at all times to exercise the utmost good faith toward their principals. They must act in accordance with the highest and truest principles of morality.” (Elco Shoe Mfrs. v Sisk, 260 NY 100, 103 [1932]). (See Sokoloff v Harriman Estates Development Corp., 96 NY 409 [2001]); Wechsler v Bowman, 285 NY 284 [1941]; Lamdin v Broadway Surface Advertising Corp., 272 NY 133 [1936]). An agent “is prohibited from acting in any manner inconsistent with his agency or trust and is at all times bound to exercise the utmost good faith and loyalty in the performance of his duties.” (Lamdin, at 136).

Thus, in the instant action, MERS, as nominee for DECISION ONE, is an agent of DECISION ONE for limited purposes. It only has those powers given to it and authorized by its principal, DECISION ONE. Plaintiff BNY failed to submit documents authorizing MERS, as nominee for DECISION ONE, to assign the subject mortgage to plaintiff BNY. Therefore, even if the assignment by MERS, as nominee for DECISION ONE, to BNY was timely, and it was not, MERS lacked authority to assign the MULLIGAN mortgage, making the assignment defective. Recently, in Bank of New York v Alderazi, 28 Misc 3d at 379-380, my learned Kings County Supreme Court colleague, Justice Wayne Saitta explained that:

A party who claims to be the agent of another bears the burden of proving the agency relationship by a preponderance of the evidence (Lippincott v East River Mill & Lumber Co., 79 Misc 559 [1913]) and “[t]he declarations of an alleged agent may not be shown for the purpose of proving the fact of agency.” (Lexow & Jenkins, P.C. v Hertz Commercial Leasing Corp., 122 AD2d 25 [2d Dept 1986]; see also Siegel v Kentucky Fried Chicken of Long Is. 108 AD2d 218 [2d Dept 1985]; Moore v Leaseway Transp/ Corp., 65 AD2d 697 [1st Dept 1978].) “[T]he acts of a person assuming to be the representative of another are not competent to prove the agency in the absence of evidence tending to show the principal’s knowledge of such acts or assent to them.” (Lexow & Jenkins, P.C. v Hertz Commercial Leasing Corp., 122 AD2d at 26, quoting 2 NY Jur 2d, Agency and Independent Contractors § 26). [*10]

Plaintiff has submitted no evidence to demonstrate that the original lender, the mortgagee America’s Wholesale Lender, authorized MERS to assign the secured debt to plaintiff [the assignment, as noted above, executed by the multi-hatted Keri Selman].

In the instant action, MERS, as nominee for DECISION ONE, not only had no authority to assign the MULLIGAN mortgage, but no evidence was presented to the Court to demonstrate DECISION ONE’s knowledge or assent to the assignment by MERS to plaintiff BNY.

Cancellation of subject 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 been settled, 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 as “the act of eliminating or nullifying.” (Black’s Law Dictionary 3 [7th ed 1999]). “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 [*11]dismissal of the instant complaint must result in the mandatory cancellation of plaintiff BNY’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, THE BANK OF NEW YORK, AS TRUSTEE FOR THE CERTIFICATEHOLDERS CWALT, INC. ALTERNATIVE LOAN TRUST 2006-OC1 MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC1, for an order of reference, for the premises located at 1591 East 48th Street, Brooklyn, New York (Block 7846, Lot 14, County of Kings), is denied with prejudice; and it is further ORDERED, that the instant action, Index Number 29399/07, is dismissed with prejudice; and it is further ORDERED that the Notice of Pendency in this action, filed with the Kings County Clerk on August 9, 2007, by plaintiff, THE BANK OF NEW YORK, AS TRUSTEE FOR THE CERTIFICATE HOLDERS CWALT, INC. ALTERNATIVE LOAN TRUST 2006-OC1 MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2006-OC1, to foreclose a mortgage for real property located at 1591 East 48th Street, Brooklyn, New York (Block 7846, Lot 14, County of Kings), is cancelled.

This constitutes the Decision and Order of the Court.

ENTER

________________________________HON. ARTHUR M. SCHACK

J. S. C.

~

August 26, 2010 10:19 AM EDT

WASHINGTON, DC — (MARKET WIRE) — 08/26/10 — Cuneo Gilbert & LaDuca, LLP and Liddle & Robinson, LLP today announced that a class action has been commenced in the United States District Court for the Southern District of Florida on behalf of purchasers of the common stock of DJSP Enterprises, Inc. (“DJSP” or the “Company”) (NASDAQ: DJSP) between March 16, 2010 and May 10, 2010, inclusive (the “Class” and “Class Period”), seeking to pursue remedies under the Securities Exchange Act of 1934 (the “Exchange Act”).

Any person seeking to serve as lead plaintiff must move the Court no later than September 20, 2010. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact Matt Miller, Esq. at Cuneo, Gilbert & LaDuca at 202-789-3960, or via e-mail at mmiller@cuneolaw.com. Any member of the Class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent Class member.

The Complaint charges DJSP and certain of its officers with violations of the Exchange Act. The Complaint alleges that, throughout the Class Period, defendants made material misrepresentations and failed to disclose material adverse facts about the Company’s true financial condition, business and prospects. Specifically, the Complaint alleges that the Company made positive representations concerning its present and future business prospects, when it knew or recklessly disregarded that (1) one of its largest clients would be drastically reducing its need for the Company’s services, and (2) the federal government’s efforts to slow down real estate foreclosures would also reduce demand for the Company’s services. According to the complaint, on May 27, 2010, the Company shocked the market by lowering its guidance for adjusted net income by $15 million to $17 million, and the price of the Company’s stock has fallen dramatically.

Cuneo Gilbert & LaDuca, a firm with offices in Washington, D.C., New York, Los Angeles and Alexandria, Va., specializes in the representation of plaintiffs in consumer, antitrust, civil rights and securities class actions and is active in major litigations pending in federal and state courts throughout the United States. The Cuneo Gilbert & LaDuca website (http://www.cuneolaw.com) has more information about the firm.

Liddle & Robinson, based in New York, represents individuals and financial services firms, hedge funds and other businesses in high-stakes, cutting-edge employment, securities and commercial litigation matters. The Liddle & Robinson website (http://www.liddlerobinson.com) has more information about the firm.

CONTACT:

Matt Miller
202-789-3960
Email Contact

VIA: ForeclosureHamlet & 4closureFraud

Dismissed With PREJUDICE!

Court finds convincing evidence that Wamu, Chase and Fishman & Shapiro committed fraud on this court!

JP MORGAN V. POCOPANNI DUVAL, COUNTY FLORIDA CASE NO.: 16-2008-CA-3989

[ipaper docId=35835555 access_key=key-31q8zmp0797mp741isl height=600 width=600 /]

Once again from Florida’s BEST PRIVATE INVESTIGATOR BILL WARNER!

Mr. Warner really deserves an enormous amount of credit for all his hard work in his investigative work!

Thank you!!

See the entire article link below…

Foreclosures Bring Wealth, Rebukes For Florida Lawyer David J. Stern Who Was Going To Name His 130 Foot Boat ‘Su Casa es Mi Casa,’ Your House Is My House, Exclusive See His Photo.

Thursday, July 22, 2010.

FROM THE ST. PETE TIMES…Sunday, July 18, 2010.  You could call him the foreclosure king of Florida. As lawyer for several major banks, David J. Stern handles 20 percent of all foreclosure cases in the nation’s fourth most populous state. It is from Stern’s law firm that well over 100,000 Floridians, including many in the Tampa Bay area, have received the dreaded notice to pay up or face losing their homes.The foreclosure business has been good to Stern, who lives in a $15 million Fort Lauderdale mansion and (STERN) reaped $58.5 million by selling his back-office operations to a new public company (DJSP enterprises) in which he is a major shareholder. But as his case load has grown, so have the controversies.  This spring, a Pasco County judge threw out a foreclosure case against a Wesley Chapel man after ruling that Stern’s firm had submitted a clearly fraudulent document.

In South Florida, a foreclosure defense lawyer discovered more than 20 mortgage documents submitted by Stern’s firm that bore notary seals that did not exist at the time the documents supposedly were notarized. The Florida Bar reprimanded Stern in 2002 for overcharging and misleading clients, and is now considering a complaint questioning whether he should be allowed to farm out so much of his firm’s business to nonlawyers. Stern declined to be interviewed for this story.  By 1999, Stern’s firm represented banks in foreclosure actions against more than 10,000 home­owners, according to records in a class action lawsuit filed in federal court in Tallahassee. The suit alleged that the firm overcharged homeowners for title searches, postage and other expenses, then submitted “false and fraudulent” invoices to support the charges. The case was closed in 2000 with Stern agreeing to pay a total of $2.1 million to homeowners.  He next drew scrutiny from the Florida Bar over complaints that his firm had misled its own clients as well as borrowers. more from the St Pete Times… The St Pete Times article is somewhat incorrect, they state that  ”Stern himself is something of an enigma. Other than references to his law firm and a sketchy biography, there is almost nothing on the Internet about him (David J. Stern).  No photos are available“.

Oh really, well I have been a private investigator in the State of Florida for 15 years and here is the short list of investigative reports that I have posted online about David J. Stern, above is one of his exclusive photos that the St Pete Times could not obtain;

Continue reading this incredible article….

Bill Warner Private Detective Blog

RELATED ARTICLE:

EXPOSED | “Foreclosure Mill” David J. Sterns’ (DJSP) OTHER MEGA ESTATE