Securitization for Lawyers: How it was Written by Wall Street Banks

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Continuing with my article THE CONCEPT OF SECURITIZATION from yesterday, we have been looking at the CONCEPT of Securitization and determined there is nothing theoretically wrong with it. That alone accounts for tens of thousands of defenses” raised in foreclosure actions across the country where borrowers raised the “defense” securitization. No such thing exists. Foreclosure defense is contract defense — i.e., you need to prove that in your case the elements of contract are absent and THAT is why the note or the mortgage cannot be enforced. Keep in mind that it is entirely possible to prove that the mortgage is unenforceable even if the note remains enforceable. But as we have said in a hundred different ways, it does not appear to me that in most cases, the loan contract ever existed, or that the acquisition contract in which the loan was being “purchased” ever occurred. But much of THAT argument is left for tomorrow’s article on Securitization as it was practiced by Wall Street banks.

So we know that the concept of securitization is almost as old as commerce itself. The idea of reducing risk and increasing the opportunity for profits is an essential element of commerce and capitalism. Selling off pieces of a venture to accomplish a reduction of risk on one ship or one oil well or one loan has existed legally and properly for a long time without much problem except when a criminal used the system against us — like Ponzi, Madoff or Drier or others. And broadening the venture to include many ships, oil wells or loans makes sense to further reduce risk and increase the likelihood of a healthy profit through volume.

Syndication of loans has been around as long as banking has existed. Thus agreements to share risk and profit or actually selling “shares” of loans have been around, enabling banks to offer loans to governments, big corporations or even little ones. In the case of residential loans, few syndications are known to have been used. In 1983, syndications called securitizations appeared in residential loans, credit cards, student loans, auto loans and all types of other consumer loans where the issuance of IPO securities representing shares of bundles of debt.

For logistical and legal reasons these securitizations had to be structured to enable the flow of loans into “special purpose vehicles” (SPV) which were simply corporations, partnerships or Trusts that were formed for the sole purpose of taking ownership of loans that were originated or acquired with the money the SPV acquired from an offering of “bonds” or other “shares” representing an undivided fractional share of the entire portfolio of that particular SPV.

The structural documents presented to investors included the Prospectus, Subscription Agreement, and Pooling and Servicing Agreement (PSA). The prospectus is supposed to disclose the use of proceeds and the terms of the payback. Since the offering is in the form of a bond, it is actually a loan from the investor to the Trust, coupled with a fractional ownership interest in the alleged “pool of assets” that is going into the Trust by virtue of the Trustee’s acceptance of the assets. That acceptance executed by the Trustee is in the Pooling and Servicing Agreement, which is an exhibit to the Prospectus. In theory that is proper. The problem is that the assets don’t exist, can’t be put in the trust and the proceeds of sale of the Trust mortgage-backed bonds doesn’t go into the Trust or any account that is under the authority of the Trustee.

The writing of the securitization documents was done by a handful of law firms under the direction of a few individual lawyers, most of whom I have not been able to identify. One of them is located in Chicago. There are some reports that 9 lawyers from a New Jersey law firm resigned rather than participate in the drafting of the documents. The reports include emails from the 9 lawyers saying that they refused to be involved in the writing of a “criminal enterprise.”

I believe the report is true, after reading so many documents that purport to create a securitization scheme. The documents themselves start off with what one would and should expect in the terms and provisions of a Prospectus, Pooling and Servicing Agreement etc. But as you read through them, you see the initial terms and provisions eroded to the point of extinction. What is left is an amalgam of options for the broker dealers selling the mortgage backed bonds.

The options all lead down roads that are absolutely opposite to what any real party in interest would allow or give their consent or agreement. The lenders (investors) would never have agreed to what was allowed in the documents. The rating agencies and insurers and guarantors would never have gone along with the scheme if they had truly understood what was intended. And of course the “borrowers” (homeowners) had no idea that claims of securitization existed as to the origination or intended acquisition their loans. Allan Greenspan, former Federal Reserve Chairman, said he read the documents and couldn’t understand them. He also said that he had more than 100 PhD’s and lawyers who read them and couldn’t understand them either.

Greenspan believed that “market forces” would correct the ambiguities. That means he believed that people who were actually dealing with these securities as buyers, sellers, rating agencies, insurers and guarantors would reject them if the appropriate safety measures were not adopted. After he left the Federal Reserve he admitted he was wrong. Market forces did not and could not correct the deficiencies and defects in the entire process.

The REAL document is the Assignment and Assumption Agreement that is NOT usually disclosed or attached as an exhibit to the Prospectus. THAT is the agreement that controls everything that happens with the borrower at the time of the alleged “closing.” See me on YouTube to explain the Assignment and Assumption Agreement. Suffice it to say that contrary to the representations made in the sale of the bonds by the broker to the investor, the money from the investor goes into the control of the broker dealer and NOT the REMIC Trust. The Broker Dealer filters some of the money down to closings in the name of “originators” ranging from large (Wells Fargo, Countrywide) to small (First Magnus et al). I’ll tell you why tomorrow or the next day. The originators are essentially renting their names the same as the Trustees of the REMIC Trusts. It looks right but isn’t what it appears. Done properly, the lender on the note and mortgage would be the REMIC Trust or a common aggregator. But if the Banks did it properly they wouldn’t have had such a joyful time in the moral hazard zone.

The PSA turned out to be the primary document creating the Trusts that were creating primarily under the laws of the State of New York because New York and a few other states had a statute that said that any variance from the express terms of the Trust was VOID, not voidable. This gave an added measure of protection to the investors that the SPV would not be used for any purpose other than what was described, and eliminated the need for them to sue the Trustee or the Trust for misuse of their funds. What the investors did not understand was that there were provisions in the enabling documents that allowed the brokers and other intermediaries to ignore the Trust altogether, assert ownership in the name of a broker or broker-controlled entity and trade on both the loans and the bonds.

The Prospectus SHOULD have contained the full list of all loans that were being aggregated into the SPV or Trust. And the Trust instrument (PSA) should have shown that the investors were receiving not only a promise to repay them but also a share ownership in the pool of loans. One of the first signals that Wall Street was running an illegal scheme was that most prospectuses stated that the pool assets were disclosed in an attached spreadsheet, which contained the description of loans that were already in existence and were then accepted by the Trustee of the SPV (REMIC Trust) in the Pooling and Servicing Agreement. The problem was that the vast majority of Prospectuses and Pooling and Servicing agreements either omitted the exhibit showing the list of loans or stated outright that the attached list was not the real list and that the loans on the spreadsheet were by example only and not the real loans.

Most of the investors were “stable managed funds.” This is a term of art that applied to retirement, pension and similar type of managed funds that were under strict restrictions about the risk they could take, which is to say, the risk had to be as close to zero as possible. So in order to present a pool that the fund manager of a stable managed fund could invest fund assets the investment had to qualify under the rules and regulations restricting the activities of stable managed funds. The presence of stable managed funds buying the bonds or shares of the Trust also encouraged other types of investors to buy the bonds or shares.

But the number of loans (which were in the thousands) in each bundle made it impractical for the fund managers of stable managed funds to examine the portfolio. For the most part, if they done so they would not found one loan that was actually in existence and obviously would not have done the deal. But they didn’t do it. They left it on trust for the broker dealers to prove the quality of the investment in bonds or shares of the SPV or Trust.

So the broker dealers who were creating the SPVs (Trusts) and selling the bonds or shares, went to the rating agencies which are quasi governmental units that give a score not unlike the credit score given to individuals. Under pressure from the broker dealers, the rating agencies went from quality culture to a profit culture. The broker dealers were offering fees and even premium on fees for evaluation and rating of the bonds or shares they were offering. They HAD to have a rating that the bonds or shares were “investment grade,” which would enable the stable managed funds to buy the bonds or shares. The rating agencies were used because they had been independent sources of evaluation of risk and viability of an investment, especially bonds — even if the bonds were not treated as securities under a 1998 law signed into law by President Clinton at the behest of both republicans and Democrats.

Dozens of people in the rating agencies set off warning bells and red flags stating that these were not investment grade securities and that the entire SPV or Trust would fail because it had to fail.  The broker dealers who were the underwriters on nearly all the business done by the rating agencies used threats, intimidation and the carrot of greater profits to get the ratings they wanted. and responded to threats that the broker would get the rating they wanted from another rating agency and that they would not ever do business with the reluctant rating agency ever again — threatening to effectively put the rating agency out of business. At the rating agencies, the “objectors” were either terminated or reassigned. Reports in the Wal Street Journal show that it was custom and practice for the rating officers to be taken on fishing trips or other perks in order to get the required the ratings that made Wall Street scheme of “securitization” possible.

This threat was also used against real estate appraisers prompting them in 2005 to send a petition to Congress signed by 8,000 appraisers, in which they said that the instructions for appraisal had been changed from a fair market value appraisal to an appraisal that would make each deal work. the appraisers were told that if they didn’t “play ball” they would never be hired again to do another appraisal. Many left the industry, but the remaining ones, succumbed to the pressure and, like the rating agencies, they gave the broker dealers what they wanted. And insurers of the bonds or shares freely issued policies based upon the same premise — the rating from the respected rating agencies. And ultimate this also effected both guarantors of the loans and “guarantors” of the bonds or shares in the Trusts.

So the investors were now presented with an insured investment grade rating from a respected and trusted source. The interest rate return was attractive — i.e., the expected return was higher than any of the current alternatives that were available. Some fund managers still refused to participate and they are the only ones that didn’t lose money in the crisis caused by Wall Street — except for a period of time through the negative impact on the stock market and bond market when all securities became suspect.

In order for there to be a “bundle” of loans that would go into a pool owned by the Trust there had to be an aggregator. The aggregator was typically the CDO Manager (CDO= Collateralized Debt Obligation) or some entity controlled by the broker dealer who was selling the bonds or shares of the SPV or Trust. So regardless of whether the loan was originated with funds from the SPV or was originated by an actual lender who sold the loan to the trust, the debts had to be processed by the aggregator to decide who would own them.

In order to protect the Trust and the investors who became Trust beneficiaries, there was a structure created that made it look like everything was under control for their benefit. The Trust was purchasing the pool within the time period prescribed by the Internal Revenue Code. The IRC allowed the creation of entities that were essentially conduits in real estate mortgages — called Real Estate Mortgage Investment Conduits (REMICs). It allows for the conduit to be set up and to “do business” for 90 days during which it must acquire whatever assets are being acquired. The REMIC Trust then distributes the profits to the investors. In reality, the investors were getting worthless bonds issued by unfunded trusts for the acquisition of assets that were never purchased (because the trusts didn’t have the money to buy them).

The TRUSTEE of the REMIC Trust would be called a Trustee and should have had the powers and duties of a Trustee. But instead the written provisions not only narrowed the duties and obligations of the Trustee but actual prevented both the Trustee and the beneficiaries from even inquiring about the actual portfolio or the status of any loan or group of loans. The way it was written, the Trustee of the REMIC Trust was in actuality renting its name to appear as Trustee in order to give credence to the offering to investors.

There was also a Depositor whose purpose was to receive, process and store documents from the loan closings — except for the provisions that said, no, the custodian, would store the records. In either case it doesn’t appear that either the Depositor nor the “custodian” ever received the documents. In fact, it appears as though the documents were mostly purposely lost and destroyed, as per the Iowa University study conducted by Katherine Ann Porter in 2007. Like the others, the Depositor was renting its name as though ti was doing something when it was doing nothing.

And there was a servicer described as a Master Servicer who could delegate certain functions to subservicers. And buried in the maze of documents containing hundreds of pages of mind-numbing descriptions and representations, there was a provision that stated the servicer would pay the monthly payment to the investor regardless of whether the borrower made any payment or not. The servicer could stop making those payments if it determined, in its sole discretion, that it was not “recoverable.”

This was the hidden part of the scheme that might be a simple PONZI scheme. The servicers obviously could have no interest in making payments they were not receiving from borrowers. But they did have an interest in continuing payments as long as investors were buying bonds. THAT is because the Master Servicers were the broker dealers, who were selling the bonds or shares. Those same broker dealers designated their own departments as the “underwriter.” So the underwriters wrote into the prospectus the presence of a “reserve” account, the source of funding for which was never made clear. That was intentionally vague because while some of the “servicer advance” money might have come from the investors themselves, most of it came from external “profits” claimed by the broker dealers.

The presence of  servicer advances is problematic for those who are pursuing foreclosures. Besides the fact that they could not possibly own the loan, and that they couldn’t possibly be a proper representative of an owner of the loan or Holder in Due Course, the actual creditor (the group of investors or theoretically the REMIC Trust) never shows a default of any kind even when the servicers or sub-servicers declare a default, send a notice of default, send a notice of acceleration etc. What they are doing is escalating their volunteer payments to the creditor — made for their own reasons — to the status of a holder or even a holder in due course — despite the fact that they never acquired the loan, the debt, the note or the mortgage.

The essential fact here is that the only paperwork that shows actual transfer of money is that which contains a check or wire transfer from investor to the broker dealer — and then from the broker dealer to various entities including the CLOSING AGENT (not the originator) who applied the funds to a closing in which the originator was named as the Lender when they had never advanced any funds, were being paid as a vendor, and would sign anything, just to get another fee. The money received by the borrower or paid on behalf of the borrower was money from the investors, not the Trust.

So the note should have named the investors, not the Trust nor the originator. And the mortgage should have made the investors the mortgagee, not the Trust nor the originator. The actual note and mortgage signed in favor of the originator were both void documents because they failed to identify the parties to the loan contract. Another way of looking at the same thing is to say there was no loan contract because neither the investors nor the borrowers knew or understood what was happening at the closing, neither had an opportunity to accept or reject the loan, and neither got title to the loan nor clear title after the loan. The investors were left with a debt that could be recovered probably as a demand loan, but which was unsecured by any mortgage or security agreement.

To counter that argument these intermediaries are claiming possession of the note and mortgage (a dubious proposal considering the Porter study) and therefore successfully claiming, incorrectly, that the facts don’t matter, and they have the absolute right to prevail in a foreclosure on a home secured by a mortgage that names a non-creditor as mortgagee without disclosure of the true source of funds. By claiming legal presumptions, the foreclosers are in actuality claiming that form should prevail over substance.

Thus the broker-dealers created written instruments that are the opposite of the Concept of Securitization, turning complete transparency into a brick wall. Investor should have been receiving verifiable reports and access into the portfolio of assets, none of which in actuality were ever purchased by the Trust, because the pooling and servicing agreement is devoid of any representation that the loans have been purchased by the Trust or that the Trust paid for the pool of loans. Most of the actual transfers occurred after the cutoff date for REMIC status under the IRC, violating the provisions of the PSA/Trust document that states the transfer must be complete within the 90 day cutoff period. And it appears as though the only documents even attempted to be transferred into the pool are those that are in default or in foreclosure. The vast majority of the other loans are floating in cyberspace where anyone can grab them if they know where to look.

The Devil Is In the Details: Summary of Issues

Editor’s note: in preparing a complex motion for the court in several related cases I ended up writing the following which I would like to share with my readers. As you can see, the issues that were once thought to be simple and susceptible to rocket docket determination are in fact complex civil cases involving issues that are anything but simple.

This is a guide and general information. DO NOT USE THIS IF YOU ARE NOT A LICENSED ATTORNEY. THESE ISSUES ARE BOTH PROCEDURALLY AND SUBSTANTIVELY ABOVE THE AVERAGE KNOWLEDGE OF A LAYMAN. CONSULT WITH AN ATTORNEY LICENSED IN THE GEOGRAPHICAL AREA IN WHICH THE PROPERTY IS LOCATED.

If you are seeking litigation support or referrals to attorneys or representation please call 520-405-1688.

SUMMARY OF ISSUES TO BE CONSIDERED

 

1)   Whether a self proclaimed or actual Trustee for a REMIC Trust is empowered to bring a foreclosure action or any action to enforce the note and mortgage contrary to the terms of the Trust document — i.e., the Pooling and Servicing Agreement (PSA) — which New York and Delaware law declare to be actions that are VOID not VOIDABLE; specifically if the Trust document names a different trustee or empowers only the servicer to bring enforcement actions against borrowers.

2)   Whether a Trustee or Servicer may initiate actions or take legal positions that are contrary to the interests of the Trust Beneficiaries — in this case creating a liability for the Trust Beneficiaries for receipt of overpayments that are not credited to the account receivable from the Defendant Borrowers by their agents (the servicer and the alleged Trustee) and the creation of liability to LaSalle Bank or the Trust by virtue of questionable changes in Trustees.

3)   Whether US Bank is the Plaintiff or should be allowed to claim that it is the Trustee for the Plaintiff Trust. Without Amendment to the Complaint, US Bank seeks to be substituted as Plaintiff in lieu of Bank of America, as successor by merger with LaSalle Bank, trustee for the Plaintiff Trust according to the Trust Document (the Pooling and Servicing Agreement) Section 8.09.

a)    A sub-issue to this is whether Bank of America is actually is the successor by merger to LaSalle Bank or if CitiMortgage is the successor to LaSalle Bank, as Trustee of the Plaintiff Trust — there being conflicting submissions on the SEC.gov website on which it appears that CitiMortgage is the actual party with ownership of ABN AMRO and therefore LaSalle Bank its subsidiary.

b)   In addition, whether opposing counsel, who claims to represent U.S. Bank may be deemed attorney for the Trust if U.S. Bank is not the Trustee for the Trust.

i)     Whether opposing counsel’s interests are adverse to its purported client or the Trust or the Trust beneficiaries, particularly with respect to their recent push for turnover of rents despite full payment to creditors through non stop servicer advances.

4)   Whether any Trustee for the Trust can bring any enforcement action for the debt including foreclosure, assignment of rents or any other relief.

5)   Whether the documentation of a loan at the base of the tree of the assignments and transfers refers to any actual transaction in which the Payee on the note and the Mortgagee on the Mortgage.

a)    Or, as is alleged by Defendants, if the actual transaction occurred when a wire transfer was received by the closing agent at the loan closing with Defendant Borrowers from an entity that was a stranger to the documentation executed by Defendant Borrowers.

b)   Whether the debt arose by virtue of the receipt of money from a creditor or if it arose by execution of documentation, or both, resulting in double liability for a single loan and double payment.

6)   Whether the assignment of mortgage is void on its face as a fabrication because it refers to an event that occurred long after the date shown on the assignment.

7)   Whether the non-stop servicer advances in all of the cases involving these Defendants and U.S. Bank negates the default or the allegation of default by the Trust beneficiaries, the Trust or the Trustee, regardless of the identity of the Trustee.

a)    Whether a DEFAULT exists or ever existed where non stop servicer advances have been paid in full.

b)   Whether the creditor, under the debt obligation of the Defendant borrowers can be allowed to receive more than the amount due as principal , interest and expenses. In this case borrower payments, non stop servicer advances, insurance, credit default swap proceeds and other payments by co-obligors who paid without subrogation or expectation of receiving refunds from the Trust Beneficiaries.

c)    Whether a new debt arises by operation of law as a result of receipt of third party defendants in which a claim might be made by the party who advanced payment to the creditor, resulting in a decrease the account receivable and a corresponding decrease in the borrower’s account (loan) payable.

i)     Whether the new debt is secured by the recorded mortgage that the Plaintiff relies upon without the borrower executing a security instrument in which the real property is pledged as collateral for the advances by third parties.

8)   Whether turnover of rents can relate back to the original default, or default letter, effectively creating a final judgment for damages before evidence is in the court record.

9)   Whether the requirements of a demand letter to Defendants for turnover of rents can be waived by the trial Court, contrary to Florida Statutes.

a)    Whether equity demands that the turnover demand be denied in view of the fact that the actual creditors — the Trust Beneficiaries of the alleged Trust were paid in full up to and including the present time.

b)   Whether, as argued by opposing counsel, the notice of default letter sent to Defendant Borrowers is an acceptable substitute to a demand letter for turnover of the rents if the letter did not mention turnover of rents.

c)    Whether the notice of default letter and acceleration was valid or accurate in view of the servicer non-stop advances and receipt of other third party payments reducing the account receivable of the Trust beneficiaries (creditors).

i)     Whether there was a difference between the account status shown by the Servicer (chase and now SPS) and the account status actually shown by the creditor — the Trust Beneficiaries who were clearly paid in full.

10)         Whether the Plaintiff Trust waived the DUE ON SALE provision in the alleged Mortgage.

a)    Whether the Plaintiff can rely upon the due on sale provision in the mortgage to allege default without amendment to their pleadings.

11)         Whether sanctions should apply against opposing counsel for failure to disclose essential facts relating to the security of the alleged creditor.

Whether this (these cases) case should be treated off the “rocket docket” for foreclosures and transferred to general civil litigation for complex issues

The US BANK-BOA-LaSalle-CitiGroup Shell Game

‘The bottom line is that the notice of substitution of Plaintiff in judicial states, or notice of substitution of Trustee in non-judicial states should be the first line of battle. Neither one of them is valid and in both cases you have a stranger to the transaction being allowed to name itself as creditor, name its own controlled entity or subsidiary as trustee, and then ignore the realities of the money paid to the real creditor. They are claiming damages from the borrower — all for a debt that in the ordinary course of things has already been paid several times over. But it is true that it wasn’t paid to THEM because THEY were never and are not now the creditor fulfilling the definition of a creditor who could bid at the foreclosure auction. It is not that the borrower doesn’t owe money when he borrows it, it is that he doesn’t owe it to any of the people who are claiming it. And that is what gives rise to liability of law firms to borrowers.” Neil F Garfield, http://www.livinglies.me

If our information can be corroborated through discovery with a corporate representative of US BANK or Chase Bank as the servicer, it is possible that a solid cause of action can be filed against the law firm that brought the action, particularly if the law firm took its instructions from the Desktop system of LPS.

In that system law firms are instructed to file foreclosures without contact with the actual client. We saw several cases where sanctions were levied against lawyers and their alleged clients, but none so stark as the one in Florida where the lawyer for US Bank as Trustee for XXX, when faced with questions he couldn’t answer admitted that he had never spoken with anyone from U.S> Bank and didn’t know who had retained his firm.

The law firm that brought the foreclosure action and especially the law firm that is demanding an assignment of rent to protect a creditor who has already been paid through non stop servicer advances was most likely not authorized to demand the assignment of rents which might be why there was no written demand as required by statute. I am considering the possibility of an actual lawsuit against one such law firm for interference with contract on both the foreclosure and the assignment of rents issue.

The Banks are being very cagey about this system — one which they would never use for their own portfolio loans, which begs the question of why they would have two entirely different system of accounting and legal process. But the long and the short of it is that LPS in Jacksonville, Florida is used much the same way as MERS. It maintains a database service that requires a user name and password and that gives unlimited access to the client folders. Anyone can go in and authorize the foreclosure based upon a default that is invested by the person entering the data. They leave out any servicer advances or other third party payments and arrive at an amount to reinstate that is just plain wrong. So virtually all notices of default are wrong which means that the required notice is defective.

You should know that many judges appear unimpressed that there was no valid assignment of the mortgage. I think that it is clearly reversible error. The assignment frequently is clearly fabricated and back-dated because of references to events that happened a year after the assignment was executed. The assignment clearly did not exist at the time of the lawsuit and the standing issue is clear under Florida law although some courts are balking at the idea that standing cannot be cured after the lawsuit. The reasoning is quite simple — if it were otherwise, you could file suit against a grocery store for a slip and fall, and the go over to the store to have your slip and fall.

In one of my cases involving multiple properties, they have an assignment that was prepared and executed by Shapiro and Fishman supposedly dated in 2007 —- but it refers to Bank of America as successor by merger to LaSalle. it is backdated, fabricated and fictional, which is to say, fraudulent.

The assignment has two problems -– FACIALLY DEFECTIVE FABRICATION OF ASSIGNMENT:  the first problem is that the alleged BOA merger with LaSalle could not have happened before 2008 — one year after the assignment was executed. So the 2007 assignment refers to a future event that was not reported by BOA until 2008, and was not approved by the Federal Reserve until 2008. On its face, then, based upon public record, the assignment is void as a total fabrication.

The second problem is that it is unclear as to how the merger could have occurred between BOA and La Salle, to wit:. you might need to read this a few times to understand the complexity of the issues involved — issues that few judges or lawyers are interested enough to master.

LASALLE ABN AMRO ACQUISITION:
Since neither entity vanished in the deal it is an acquisition and not a merger. LaSalle and ABN AMRO did a reverse merger in 2007.

That means that while LASalle was technically the acquirer, because it “bought” ABN AMRO, and ABN AMRO became a subsidiary — the reality is that LaSalle issued so many shares for the acquisition of ABN AMRO that the ABN AMRO shareholders received the overwhelming majority of LaSalle Shares compared to the former owners of LaSalle shares.

Hence in substance LaSalle Bank was a subsidiary of ABN AMRO and the consolidated financial statements show it. But in form it appears as the parent.

So if someone, like BOA, was to say they merged with or acquired LaSalle, they would also be saying that included its subsidiary ABN AMRO — and they would have to do the deal with the shareholders of ABN AMRO because those shareholders control LaSalle Bank, which brings us to CitiGroup —-

CITIGROUP MERGER WITH ABN AMRO: Also in 2007, CitiGroup announced and continues to file sworn statements with the SEC that it had merged with ABN AMRO, which means, if you followed the above, that CitiGroup actually owned LaSalle. It looks more like an acquisition than a merger to me but the wording makes it unclear. This would mean that LaSalle still technically exists as a subsidiary of  CitiGroup.

ALLEGED BOA MERGER WITH LASALLE: In 2008 the Federal Reserve issued an order approving the merger of BOA and LaSalle, in which case LaSalle vanishes — but ABN AMRO is the one with all the assets. BUT LaSalle is named as Trustee of the asset pool. And the only other allowable trustee would be another bank that merged with LaSalle as a successor without the requirement of filing more papers to be a Trustee and BOA clearly qualifies on all counts for that. Section 8.09 of PSA.

But the Federal Reserve order states that the identities of ABN AMRO and LaSalle are the same and the acquisition of one is the acquisition of the other — thus unintentionally ratifying CitiGroup’s apparent position that it owns ABN AMRO and thus LaSalle.

Findings of fact by an administrative agency are presumptively true although subject to rebuttal.

Here is the kicker: there is no further mention in any SEC filings of a merger between BOA and LaSalle, unless I missed it. There is no reference to the fact that CitiGroup controlled LaSalle and ABN AMRO at the time of the Federal Reserve order approving the BOA merger with LaSalle Bank in 2008.

CitiGroup has not, to my knowledge ever reported the sale or loss or merger of LaSalle. Since Citi made the acquisition before BOA, and since BOA apparently did not buy LaSalle from Citi, how could BOA claim to be a successor by merger with LaSalle?

Hence there are questions of fact as to whether BOA ever consummated any transaction in which it acquired or Merged with LaSalle, which while technically possible, makes no business sense. UNLESS the OBJECTIVE was to transfer the interest of LaSalle as trustee to BOA, as a precursor to a much wider deal in which BOA then sold its position as Trustee to US Bank as a  commodity and then filed in the Kalam cases a notice of substitution of Plaintiff without amending the pleadings.

US BANK Notice of Substitution of Plaintiff without Any Motion to Amend Pleadings: The reason they filed it as a notice was that they obviously did not want to allege the purchase of “being a trustee”, which would have been a contested issue in the pleadings. But the amendment is required in my opinion and there should be a motion to strike the notice of substitution of Plaintiff without amendment. The motion to strike should state that no objection to granting the order to amend, but that the circumstances should be pled and we should be able to respond with a denial and affirmative defenses if you choose.

The CLOUD: No Name, No Docs, No Terms, No Balance Due: MBS Investors Screwed and Taking Borrowers Down With Them

Writing with the flu. Despite symptoms and medication that makes me dizzy, I feel compelled to write about something that is getting traction out there. The more you look at the false claims of securitization the more it stinks. We are dealing with a system that is based on really big lies. I’m sure our leaders of government have a very appealing rationalization why we must pretend the mortgage bonds are real, why we must pretend the mortgages are real, why we must pretend the notes are real, and why we must pretend the debts and defaults are real. But those are lies based on sham transactions. And those lies are based in public policy. And public policy is contrary to law.

My focus is on cases pending in the judicial branch of government. Our system of government was designed to insert the judicial branch into disputes so that fractures in public policy do not cheat citizens out of their basic rights. In this case, the failure of the other two branches of government to include the rights of homeowners is damaging both to the society generally and producing millions of cases of unjust enrichment and displacement of millions of people from their homes in cases, where if all facts were known two facts would be inescapably accepted: (1) mortgages filed as encumbrances against real property were fatally defective and unenforceable and (2) the balance owed on the debt is either impossible to ascertain or zero, with a liability owed to homeowners on the overpayments received in the midst of that opaque cloud we are calling “securitization.”

The trigger for the writing of this article is once again coming from BANK OF NEW YORK MELLON as the “Trustee” of vast numbers of REMIC Trusts. Bill Paatalo, a private investigator, uncovered an officer of BONY who is very frustrated with BOA and others who are telling borrowers that BONY is the owner of their loan. Indeed, suits have been brought in the name of BONY without any reference to the trust; and of course suits have been brought in the name of BONY as Trustee of a REMIC Trust, which represents but does not own the loans (the ownership interest being “conveyed” with the issuance of the mortgage bond to investors who were duped into thinking they were buying high grade investments. BONY and DEUTSCH both say such suits are brought without their authorization and have instructed servicer’s to cease and desist using the name of Deutsch of BONY MELLON in foreclosure suits.

The problem revealed is contained in an email Paatalo posted from an officer of BONY MELLON, who wants BOA to stop telling people that BONY is the owner of their loans. He says BONY doesn’t own the loans and has no right, power or obligation to modify or mitigate damages caused by the borrower failing or stopping payments on the loan they unquestionably received. He says BONY is the Trustee for the loan and denies ownership and further denies the ability or right to modify.

What he doesn’t say is what he means by “Trustee for the loan” and why the “trust” should be considered real as a legal person when there is no financial account or assets held in the name of the Trust. Like Reynaldo Reyes at Deutsch Bank, he is basically saying there are no trust assets, there never was any funding of the trust, and there never was an assignment or purchase of the loan by the trust — for the simple reason that the Trust never had a bank account much less the money to buy loans or anything else.

So Reyes and this newly revealed actor from BONY are saying the same thing. They are Trustees in name only without any duties because no money or assets are in the trust. Which brings us back to the beginning. If the loan was securitized, the Trust would have had a bank account to receive money advanced by investors who were purchasing alleged mortgage bonds that promised that the investor also was an owner of the loans — an undecided percentage interest in the loans.

That money in the Trust account would have been used to fund or purchase the loan to the borrower. And the Trust would have been the mortgagee or beneficiary on the mortgage or deed of trust. There would have been no need for MERS, or originators or any of the countless sham corporations that are now out of business and who supposedly loaned money to borrowers. If it was real, the records would show the Trust paid for the loan and the recorded documents from the loan closing would clearly show the Trust as the lender.

It is really a very simple deal, if it is real. But complexity was introduced by Wall Street, the effect of which was that the lenders didn’t get the loans they were expecting, didn’t get the collateral they thought they were getting and didn’t even get named as lenders despite the fact that it was investor money that was used to make and acquire the loans. Like the borrowers, investors were stepping into a cloud that intentionally obscured the ownership of the loan.

On the one hand, the Banks covered ownership by the issuance and execution of an Assignment and Assumption Agreement, but that was before any loan applications existed, just like the prospectus and sale of the bonds — a process known as selling forward on Wall Street. On the other hand, the bonds were issued in the name of the investment banks, a process called Street Name on Wall Street. On the third hand, the loan documents showed neither the investment banks nor the investors or even the REMIC Trusts. instead they showed some other entity as the lender even though the “lender” had advanced mooney whatsoever — a process later dubbed as “pretender lenders” by me in in my writing and seminars.

By pushing title through pretender lenders and private exchanges that registered title that was never published (like the county recorders’ offices publish recorded deeds, mortgages and liens), the Banks created a Cloud which by definition created clouded title to the property, the loan and created a mortgage document that was recorded despite naming the wrong terms and the wrong payee.

Pushing title away from the investors who advanced the money and toward themselves, the Banks were able to play with the money as if it were their own, and even purchase insurance and credit default swaps payable to the banks, who were clearly the intermediary agents of the investors. And the Banks even got the government to guarantee half the loans even though the underwriting standards were ignored — since the banks had no risk of loss on the loans (they were using investor money and they were getting the right to receive third party payments from the government and private parties). Eventually after the meltdown, the Banks became part of a program where tens of billions of dollars worth of the bogus mortgage bonds owned by the investors were sold to the Federal government (some $50 Billion per month).

Through their creation of the Cloud, the banks were able to take the money of the investors and receive it as their own, concealing the initial theft (skimming) off the top by creating sham proprietary trades. Now they are receiving judgments and deeds from foreclosure auctions based upon their submission of a credit bid that clearly violates the very specific provisions of state statutes that identify who can submit a credit bid rather than cash at the auction. Only the actual owner of the unpaid account receivable has the right to submit a credit bid.

And by the creation of the Cloud judges and lawyers missed the point completely. The result is stripping the investors of value, ownership and right to collect on the loans they advanced. At no time has any Servicer filed a foreclosure in the name of the investors whose money was used to fund the deal. In no case is there any underlying real transaction in which real money was paid and something was received in exchange. The Courts are now the vehicle of public policy and manifest injustice by enforcement of unenforceable mortgages for fabricated notes referring to non existent debts.

The net result is that public policy and government action is contrary to the rule of law.

4th DCA Florida: Trustee of Asset Pool Must Join or Ratify

 

“servicer may be considered a party in interest to commence legal action as long as the trustee joins or ratifies its action.”

ElstonLeetsdale LLC v CWCapital Asset Management LLC-1

This ought to be interesting. If Deutsch, or U.S. Bank, or Bank of New York, or any of the other “Trustees” join or ratify the action then they are asserting, under oath (if the lawyer for the homeowner knows what he or she is doing) that (1) the Asset pool is exists, (2) that the subject loan is in the asset pool (i.e., consideration paid by the Trust and assignment before cut-off date) and (3) that the trust was properly organized and (4) that the Trustee is authorized by [fill in blank here, if the lawyer of the homeowner knows what he or she is doing] to accept the assignment, join in the lawsuit and ratifies the representations and claims made on behalf of the REMIC trust and (5) signed by  a trust officer for the bank who says it is the trustee for the asset pool.

You might want to ask while you are on the subject, exactly why the Trustee wants to bind the beneficiaries of the trust to ownership of a worthless loan. This is a question raised by Judge Shack in New York 5 years ago. Nobody was listening. Now maybe some people are starting to see the wisdom of Shack’s question. If securitization was on the level, then the funding, assignment, assumption and payment would have all occurred as set forth under New York Law, the Internal Revenue Code, the provisions of the Pooling and servicing Agreement, which means underwriting according to industry standards and procuring insurance and credit default swap protection FOR THE INVESTORS, NOT THE BANKS WHO HAD NO MONEY IN THE DEAL.

So while you are on the subject, you might want to ask the trustee why they have made no claim against the insurance, credit default swaps and other payments received from co-obligors that were not disclosed to the borrower. In fact, you might want to ask whether the trustee views this as an account receivable, bond receivable or note receivable? If he or she doesn’t know, ask who would know — after all a trustee is like a receiver with special skills and experience in keeping the books for each trust and assuring customers there would be no commingling of funds. If the trustee doesn’t think the trust is owed any money other than the payments from the borrower, ask him or her, why not?

Once the trustee acknowledges that there were payments which should have been allocated to the bond receivable account or account receivable for the investors, then ask the big question, to wit: do your books and records show the same flow of money in and out of the trust as the figures used by the subservicer in declaring the default, and bringing the foreclosure action. Once you get by “I don’t know” the answer is going to be “NO” if you drill deep enough and keep asking the questions who knows, what do they know, how do they know it and is the party claiming to be the trustee really a trustee?

I ask you this: with each of these fine banking institutions maintaining separate corporations or divisions that provide trust services for even a few hundred thousand dollars, why wasn’t the same trust department used to provide trust services to the REMIC trust? Why is it managed by Reynaldo Reyes, VP, Asset management at Deutsch Bank? What fees were received by the trustee? What services did it perform?

Suddenly a new dawn is upon us. The banks knowing full well they were going to claim and get free houses started early and effectively in persuading the media, government and the public, including the borrowers themselves that to defend the foreclosure was immoral because the borrower was seeking a free house. The banks were smart enough to get out in front of that one, but it is coming back around to bite them. The homeowners are not seeking free homes, they are seeking reasonable deals based upon true facts instead of false representations, withholding of disclosures required by law and lies from the intermediaries who pretend to be the lenders or to act for the lenders when they do not.

Is there a free house? Yes, every time another Judge rubber stamps another foreclosure and allows a non-creditor to submit a “credit bid” (non-cash) and take title to a home they advanced no money to finance or purchase any loan.

 

OCC: 13 Questions to Answer Before Foreclosure and Eviction

13 Questions Before You Can Foreclose

foreclosure_standards_42013 — this one works for sure

If you are seeking legal representation or other services call our South Florida customer service number at 954-495-9867 and for the West coast the number remains 520-405-1688. In Northern Florida and the Panhandle call 850-765-1236. Customer service for the livinglies store with workbooks, services and analysis remains the same at 520-405-1688. The people who answer the phone are NOT attorneys and NOT permitted to provide any legal advice, but they can guide you toward some of our products and services.

SEE ALSO: http://WWW.LIVINGLIES-STORE.COM

The selection of an attorney is an important decision  and should only be made after you have interviewed licensed attorneys familiar with investment banking, securities, property law, consumer law, mortgages, foreclosures, and collection procedures. This site is dedicated to providing those services directly or indirectly through attorneys seeking guidance or assistance in representing consumers and homeowners. We are available to any lawyer seeking assistance anywhere in the country, U.S. possessions and territories. Neil Garfield is a licensed member of the Florida Bar and is qualified to appear as an expert witness or litigator in in several states including the district of Columbia. The information on this blog is general information and should NEVER be considered to be advice on one specific case. Consultation with a licensed attorney is required in this highly complex field.

Editor’s Note: Some banks are slowing foreclosures and evictions. The reason is that the OCC issued a directive or letter of guidance that lays out in brief simplistic language what a party must do before they can foreclose. There can be little doubt that none of the banks are in compliance with this directive although Bank of America is clearly taking the position that they are in compliance or that it doesn’t matter whether they are in compliance or not.

In April the OCC, responding to pressure from virtually everyone, issued a guidance letter to financial institutions who are part of the foreclosure process. While not a rule a regulation, it is an interpretation of the Agency’s own rules and regulation and therefore, in my opinion, is both persuasive and authoritative.

These 13 questions published by OCC should be used defensively if you suspect violation and they are rightfully the subject of discovery. Use the wording from the letter rather than your own — since the attorneys for the banks will pounce on any nuance that appears to be different than this guidance issued to the banks.

The first question relates to whether there is a real default and what steps the foreclosing party has taken to assure itself and the court that the default is real. Remember that the fact that the borrower stopped paying is not a default if no payment was due. And there is no default if it is cured by payment from ANYONE after the declaration of default. Thus when the subservicer continues making payments to the “Creditor” the borrower’s default is cured although a new liability could arise (unsecured) as a result of the sub servicer making those payments without receiving payment from the borrower.

The point here is the money. Either there is a balance or there is not. Either the balance is as stated by the forecloser or it is not. Either there is money due from the borrower to the servicer and the real creditor or there is not. This takes an accounting that goes much further than merely a printout of the borrower’s payment history.

It takes an in depth accounting to determine where the money came from continue the payments when the borrower was not making payments. It takes an in depth accounting to determine if the creditor still exists or whether there is an successor. And it takes an in depth accounting to determine how much money was received from insurance and credit default swaps that should have been applied properly thus reducing both the loan receivable and loan payable.

This means getting all the information from the “trustee” of the REMIC, copies of the trust account and distribution reports, copies of canceled checks and wire transfer receipts to determine payment, risk of loss and the reality of whether there was a loss.

It also means getting the same information from the investment banker who did the underwriting of the bogus mortgage bonds, the Master Servicer, and anyone else in the securitization chain that might have disbursed or received funds in connection with the subject loan or the asset pool claiming an interest in the subject loan, or the owners of mortgage bonds issued by that asset pool.

If the OCC wants it then you should want it for your clients. Get the answers and don’t assume that because the borrower stopped making payments that any default occurred or that it wasn’t cured. Then go on to the other questions with the same careful analysis.

http://www.businessweek.com/news/2013-05-17/wells-fargo-postpones-some-foreclosure-sales-after-occ-guidance

/http://www.occ.gov/topics/consumer-protection/foreclosure-prevention/correcting-foreclosure-practices.html

Keystone Fraud by Banks: Business Records Exception to Hearsay Rule

Practice Note: Hearsay is not evidence and should not be used as the basis for any conclusion of facts that would support any conclusion of law. While the banks are extremely vulnerable to having all testimony and documents barred by the hearsay rule, this is ONLY true if the proper objection is made at the proper time — and objections should be made when opposing counsel makes reference to the content of those records as though they were already established. Although representations by counsel are not evidence, the attorney’s failure to object to the representation is a failure to bring to the Judge’s attention the fact that you contest those assertions. The objection could be phrased that counsel is attempting to get his own representations on record based upon facts that are in dispute and not in the record. A good record of those objections — including the use of a court reporter — is the basis for appeal. Without that record the Judge is inclined to do whatever he or she wants and while it is possible to re-establish the record in the absence of a court reporter it is very difficult and time-consuming. The reviewing court looks only to the record. If the objection does not appear, then the reviewing court has no choice but to affirm the lower court decision. An appeal is NOT an opportunity to retry the case. on substantive grounds. It is primarily a vehicle to contest the procedures and rulings in the court below as to procedure and the admissibility of evidence.

see http://livinglies.wordpress.com/2013/04/29/hawaii-federal-district-court-applies-rules-of-evidence-bonymellon-us-bank-jp-morgan-chase-failed-to-prove-sale-of-note/

If you are seeking legal representation or other services call our Florida customer service number at 954-495-9867 and for the West coast the number remains 520-405-1688. Customer service for the livinglies store with workbooks, services and analysis remains the same at 520-405-1688. The people who answer the phone are NOT attorneys and NOT permitted to provide any legal advice, but they can guide you toward some of our products and services.
The selection of an attorney is an important decision  and should only be made after you have interviewed licensed attorneys familiar with investment banking, securities, property law, consumer law, mortgages, foreclosures, and collection procedures. This site is dedicated to providing those services directly or indirectly through attorneys seeking guidance or assistance in representing consumers and homeowners. We are available to any lawyer seeking assistance anywhere in the country, U.S. possessions and territories. Neil Garfield is a licensed member of the Florida Bar and is qualified to appear as an expert witness or litigator in in several states including the district of Columbia. The information on this blog is general information and should NEVER be considered to be advice on one specific case. Consultation with a licensed attorney is required in this highly complex field.

Editor’s Analysis: Business records are ALWAYS hearsay and barred by the hearsay rule in state and Federal courts. The question is not whether the business records are hearsay but rather whether the records are deemed reliable enough to waive the requirement of testimony from those with knowledge of the facts offered to prove the case of the proponent of those records. If they are deemed reliable by the Judge then they are allowed to be admitted as evidence to prove the truth of the matters asserted in those records. The tests for reliability are in the statutes of each state and the Federal rules of evidence that allow for exceptions to hearsay in order to allow the business records into evidence, which ARE hearsay and otherwise barred as evidence, under the “business records exception.”

The general rule is that evidence consists of testimony from a knowledgeable witness competent to testify as to the matters asserted. Competency of witnesses is determined by oath, personal perception of events, memory and the ability to communicate the facts as personally experienced, viewed, or heard by the witness. The business records exception requires the custodian of records to provide the foundation for asserting the business records exception. This is the starting point.

The custodian of records must be established by foundation testimony and should not be allowed without testimony that demonstrates the witness’ scope of employment, knowledge and authority. Objection should be made when the leading question is asked “Are you the custodian of the records?” An objection is required that the question is leading and lacks foundation — showing the facts and circumstances under which the witness should be accepted by the court as the custodian of the records.

The records must be from a source that is relevant to the proceedings. If the party seeking foreclosure is an asset pool, represented by a trustee, then the business records of the trustee are the only thing that is relevant unless the foundation is laid by opposing counsel to show that the records of the servicer matches the records of the trustee.

TESTIMONY OF THE SERVICER: Without the custodian of records for the trustee, it seems impossible to establish the proper foundation showing that the trustee asserts that the records of the trustee are the same as the servicer. And if that is true, there may be no reason for the servicer to testify as to the business records since it is only the trustee who can account for all money paid out and all money received, directly or indirectly on account of the subject loan.

[NOTE: THE TRUSTEE SHOULD BE ABLE TO TESTIFY THAT IT IS THE TRUSTEE OF THE TRUST THAT OWNS THE SUBJECT LOAN AND TO PRODUCE DOCUMENTS SHOWING THE SALE OF THE LOAN TO THE TRUST OR ASSET POOL. REMEMBER THAT A SALE REQUIRES CONSIDERATION AND THUS THE RECORDS SHOULD INCLUDE A RECORD OF THAT SALE, THE AMOUNT PAID, AND THE DOCUMENTS MEMORIALIZING THAT TRANSACTION.]

The witness who testifies for the proponent of the documents sought to be admitted into evidence must be competent to testify as records custodian that the trust has been and still is the owner of the loan. The banks will vigorously oppose your effort to hold their feet to the fire because all indications are that the trustee has no records and doesn’t even have a bank account for the “trust’ or asset pool, much less evidence of the amount paid for the loan, and the documents memorializing the “transaction.”

In many cases, the case for ownership or foreclosure collapses completely because in fact the trust or pool never did acquire ownership because there was no sale and the trustee never had any records showing the money paid by the homeowner or other parties who may have paid down the loan under non-subrogated obligations to payoff the debt. The creditor only being entitled to recover once on the debt, must show that there were no mitigating payments received by the trustee or anyone on its behalf as agent, servant or employee or affiliate.

In truth the relevant records are either wholly within the records of the MASTER SERVICER and neither the subservicer that the proponent wishes to offer nor the trustee has a complete record who who funded the origination or purchase of the loan. Thus while the business records of the sub-servicer might eventually be admitted over objection of the homeowner, it can and should be argued that this is only a partial picture; this accomplished on cross examination or if possible voir dire, where the witness is questioned as to what they don’t know, to wit” the details of the origination, purchase or funding of the loan together with all receipts relating to the loan account directly or indirectly.

Having started with the question of whether the witness is in fact a records custodian, the question then becomes whether the proffered witness is the only records custodian. At one trial recently conducted the witness was (a) not a custodian, (b) declared that the records came from numerous “clients” and other departments, the identity of the custodian of those records never being mentioned.

[Practice Note: When the witness is from the "loss mitigation department" or some similar division or department, they are by virtual definition not the records custodian, and cannot be a competent witness to testify as to the records. On voir dire conclusion the objection should be made that the witness is not the records custodian for any or all of the records sought to be introduced and is therefore not competent to provide the foundation for the business records exception to the hearsay rule.]

The first requirement (see Florida statutes below for example) to test the reliability of the records is that the the record entry be made at or near the time of the event.

If the servicer is testifying, then the servicer cannot testify as to the either the origination or sale of the loan, both having preceded the involvement of the servicer virtually by definition. While the impulse of the court is going to be presume that the closing was completed, this is overcome by the denial of the homeowner that the closing was in fact completed because the named payee on the note and mortgage never fulfilled their obligations — to fund the loan. It is not enough to be the party who caused the loan to be made —- that is a mortgage broker who obviously has not rights to ownership or foreclosure. This leaves the proponent with the requirement of proving up the completion of the initial transaction showing the funding by testimony of a competent witness (custodian of records of the relevant parties) to show payment and receipt of the funding of the origination or sale of the loan.

The second test relates to competency of the witness which is that the person offering the testimony or even the affidavit must show that they are a person with personal knowledge sufficient to be either the records custodian or a witness to the event.

The banks in Florida will attempt to get around this problem by offering a certification, but the certification must contain sworn statements as to the personal knowledge of the person who executes such certification. The requirements of testimony on the stand are NOT waived by virtue of submitting a certification. Without establishing the competency of the person to be admitted as a witness custodian of the records, the certification is a sham. And such certification should be determined before trial in a motion in limine before trial begins or objection to certification (see below).

The “certification” must contain the same required statements of fact that would otherwise be required on the stand as a live witness. Timeliness of objections is the key to trial practice. Failure to object and take the offensive on this issue will result in documents being admitted into evidence that establish a prima facie case when no such case exists.

If a certification is intended to be used, the homeowner must receive notice of such intent, the identity and contact information for the person signing the certification and an opportunity to challenge the veracity of the statements contained in the certification and the authenticity of the documents itself given the constant practice of robo-signing and surrogate signing.

Discovery is appropriate to require the proponent of the certification to show the employment record and other indicia that the person is indeed a custodian of all the records and that all the records sought to be introduced at trial are within the custody of the witness. A trick often used in court is that the witness will testify as to custody of one document and without an alert objection from the homeowner, the rest of the documents, which are hearsay, are then admitted into evidence without the certification or the foundation because the homeowner failed to object.

Failure to give notice of the intent to use certification in lieu of live testimony is fatal at trial — if the homeowner objects. Certification should ALWAYS be met with a well written objection — and fee free to plagiarize anything in this article. In most cases in an abundance of caution, the Judge will require live testimony in lieu of certification.

Conversely, failure to object to the certification may well leave the homeowner in the cold, because by the time the trial begins all acts necessary to the prima facie case of the proponent of foreclosure or ownership of the loan will have already been established.

Florida Statutes 90.803 et seq: in pertinent abstract is as follows:

(6)  RECORDS OF REGULARLY CONDUCTED BUSINESS ACTIVITY.–

(a)  A memorandum, report, record, or data compilation, in any form, of acts, events, conditions, opinion, or diagnosis, made at or near the time by, or from information transmitted by, a person with knowledge, if kept in the course of a regularly conducted business activity and if it was the regular practice of that business activity to make such memorandum, report, record, or data compilation, all as shown by the testimony of the custodian or other qualified witness, or as shown by a certification or declaration that complies with paragraph (c) and s. 90.902(11), unless the sources of information or other circumstances show lack of trustworthiness. The term “business” as used in this paragraph includes a business, institution, association, profession, occupation, and calling of every kind, whether or not conducted for profit.

(b)  Evidence in the form of an opinion or diagnosis is inadmissible under paragraph (a) unless such opinion or diagnosis would be admissible under ss. 90.701-90.705 if the person whose opinion is recorded were to testify to the opinion directly.

(c)  A party intending to offer evidence under paragraph (a) by means of a certification or declaration shall serve reasonable written notice of that intention upon every other party and shall make the evidence available for inspection sufficiently in advance of its offer in evidence to provide to any other party a fair opportunity to challenge the admissibility of the evidence. If the evidence is maintained in a foreign country, the party intending to offer the evidence must provide written notice of that intention at the arraignment or as soon after the arraignment as is practicable or, in a civil case, 60 days before the trial. A motion opposing the admissibility of such evidence must be made by the opposing party and determined by the court before trial. A party’s failure to file such a motion before trial constitutes a waiver of objection to the evidence, but the court for good cause shown may grant relief from the waiver.

(7)  ABSENCE OF ENTRY IN RECORDS OF REGULARLY CONDUCTED ACTIVITY.–Evidence that a matter is not included in the memoranda, reports, records, or data compilations, in any form, of a regularly conducted activity to prove the nonoccurrence or nonexistence of the matter, if the matter was of a kind of which a memorandum, report, record, or data compilation was regularly made and preserved, unless the sources of information or other circumstances show lack of trustworthiness.

(8)  PUBLIC RECORDS AND REPORTS.–Records, reports, statements reduced to writing, or data compilations, in any form, of public offices or agencies, setting forth the activities of the office or agency, or matters observed pursuant to duty imposed by law as to matters which there was a duty to report, excluding in criminal cases matters observed by a police officer or other law enforcement personnel, unless the sources of information or other circumstances show their lack of trustworthiness. The criminal case exclusion shall not apply to an affidavit otherwise admissible under s. 316.1934 or s. 327.354.

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