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MISSION STATEMENT: I believe that the mortgage crisis has produced manifest evil and injustice in our society. I believe our recovery will never reach the majority of struggling Americans until we restore equal protection for all citizens and especially borrowers in our debt-ridden society. LivingLies is the vehicle for a collaborative movement to provide homeowners with sufficient resources to combat bloated banks who are flooding the political market with money. We provide thousands of pages of free forms, articles and discussion of statutes, case precedent and policy on this site. And we provide paid services, books and products that enable us to maintain an infrastructure to provide a voice to the victims of Wall Street corruption.

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RECOMMENDED READING:

CHAIN OF TITLE by David Dayen. Available on Amazon

LISTEN LIBERALS! by Thomas Frank. Available on Amazon and Kindle.

Pretender Lenders: How Tablefunding and Securitization Go Hand in Hand” By William Paatalo and Kimberly Cromwell. CLICK: http://infotofightforeclosure.com/tools-store/ebooks-and-services/?ap_id_102

California Suspends Dealings with Wells Fargo

The real question is when government agencies and regulators PLUS law enforcement get the real message: Wells Fargo’s behavior in the account scandal is the tip of the iceberg and important corroboration of what most of the country has been saying for years — their business model is based upon fraud.

Wells Fargo has devolved into a PR machine designed to raise the price of the stock at the expense of trust, which in the long term will most likely result in most customers abandoning such banks for fear they will be the next target.

Get a consult! 202-838-6345

https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments.
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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see http://www.sacbee.com/news/politics-government/capitol-alert/article104739911.html

John Chiang, California Treasurer, has stopped doing business with Wells Fargo because of the scheme involving fraud, identity theft and customer gouging for services they never ordered on accounts they never opened. It is once again time for Government to scrutinize the overall business plan and business map of Wells Fargo and indeed all of the top (TBTF) banks.

Wells Fargo is attempting to do crisis management, to wit: making sure that nobody looks at other schemes inside the bank.

It is the Consumer Financial Protection Bureau (CFPB) that was conceived by Senator Elizabeth Warren who has revealed the latest example of big bank fraud.

The simple fact is that in this case, Wells Fargo management made an absurd demand on their employees. Instead of the national average of 3 accounts per person they instructed managers and employees to produce 8 accounts per customer. Top management of Wells Fargo have been bankers for decades. They knew that most customers would not want, need or accept 5 more accounts. Yet they pressed hard on employees to meet this “goal.” Their objective was to defraud the investing public who held or would buy Wells Fargo stock.

In short, Wells Fargo is now the poster child for an essential defect in business structure of public companies. They conceive their “product” to be their stock. That is how management makes its money and that is how investors holding their stock like it until they realize that the entire platform known as Wells Fargo has devolved into a PR machine designed to raise the price of the stock at the expense of trust, which in the long term will most likely result in most customers abandoning such banks for fear they will be the next target. Such companies are eating their young and producing a bubble in asset values that, like the residential mortgage market, cannot be sustained by fundamental facts — i.e., real earnings on a real trajectory of growth.

So the PR piece about how they didn’t know what was going on is absurd along with their practices. Such policies don’t start with middle management or employees. They come from the top. And the goal was to create the illusion of a rapidly growing bank so that more people would buy their stock at ever increasing prices. That is what happens when you don’t make the individual members of management liable under criminal and civil laws for engaging in such behavior.

There was only one way that the Bank could achieve its goal of 8 accounts per customer — it had to be done without the knowledge or consent of the customers. Now Wells Fargo is trying to throw 5,000 employees under the bus. But this isn’t the first time that Wells Fargo has arrogantly thrown its customers and employees under the bus.

The creation of financial accounts in the name of a person without that person’s knowledge or consent is identity theft, assuming there was a profit motive. The result is that the person is subjected to false claims of high fees, their credit rating has a negative impact, and they are stuck dealing with as bank so large that most customers feel that they don’t have the resources to do anything once the fraud was discovered by the Consumer Financial protection Board (CFPB).

Creating a loan account for a loan that doesn’t exist is the same thing. In most cases the “loan closings” were shams — a show put on so that the customer would sign documents in which the actual party who loaned the money was left out of the documentation.

This was double fraud because the pension funds and other investors who deposited money with Wells Fargo and the other banks did so under the false understanding that their money would be used to buy Mortgage Backed Securities (MBS) issued by a trust with assets consisting of a loan pool.

The truth has emerged — there were no loan pols in the trusts. The entire derivative market for residential “loans” is built on a giant lie.  But the consequences are so large that Government is afraid to do anything about it. Wells Fargo took money from pension funds and other “investors,” but did not give the proceeds of sale of the alleged MBS to the proprietary vehicle they created in the form of a trust.

Hence the trust was never funded and never acquired any property or loans. That means the “mortgage backed securities” were not mortgage backed BUT they were “Securities” under the standard definition such that the SEC should take action against the underwriters who disguised themselves as “master Servicers.”

In order to cover their tracks, Wells Fargo carefully coached their employees to take calls and state that there could be no settlement or modification or any loss mitigation unless the “borrower” was at least 90 days behind in their payments. So people stopped paying an entity that had no right to receive payment — with grave consequences.

The 90 day statement was probably legal advice and certainly a lie. There was no 90 day requirement and there was no legal reason for a borrower to go into a position where the pretender lender could declare a default. The banks were steering as many people, like cattle, into defaults because of coercion by the bank who later deny that they had instructed the borrower to stop making payments.

So Wells Fargo and other investment banks were opening depository accounts for institutional customers under false pretenses, while they opened up loan accounts under false pretenses, and then  used the identity of BOTH “investors” and “borrowers” as a vehicle to steal all the money put up for investments and to make money on the illusion of loans between the payee on the note and the homeowner.

In the end the only document that was legal in thee entire chain was a forced sale and/or judgment of foreclosure. When the deed issues in a forced sale, that creates virtually insurmountable presumptions that everything that preceded the sale was valid, thus changing history.

The residential mortgage loan market was considerably more complex than what Wells Fargo did with the opening of the unwanted commercial accounts but the objective was the same — to make money on their stock and siphon off vast sums of money into off-shore accounts. And the methods, when you boil it all down, were the same. And the arrogant violation of law and trust was the same.

 

The Neil Garfield Radio Program: Back to Basics with North Carolina Attorney James Surane

 

The JPMorgan Paper Chase Live at 6 pm

 

Thursdays LIVE! Click in to the The Neil Garfield Show

Or call in at (347) 850-1260, 6pm Eastern Thursdays

This evening North Carolina attorney Jim Surane will join Neil Garfield to discuss the first steps that should be taken in a Foreclosure defense case.

Surane states that, “A thorough title search of the property being subject to foreclosure is an absolute necessity.  This includes researching back to the plat in the case of a home in a subdivision, and back 30 years in a case in which the property is not in a subdivision.”  Surane has won many cases based upon errors in the chain of title.  “It must be remembered that a large majority of the mortgages that we deal with today were closed between the years of 1992 – 2007.  During these years, closing attorneys and lenders were overwhelmed with business, and as a result many errors in preparing documents that compromised the lenders lien rights.”  Surane will outline the steps that should be taken in order to properly prepare to defend a foreclosure case including:

  • Errors in the legal descriptions
  • The legal description was attached at the time the deed of trust was signed
  • Errors in the timing of the recordation of documents in the chain of title
  • Errors in the spelling of the grantor or grantee names
  • Both Grantors names in the body of the Deed of Trust and not just signed
  • Failure to include all necessary signatures on deeds

Attorney James Surane is the Managing Partner at James W. Surane Law.  He manages all aspects of trial preparation and Superior Court appearances involving foreclosure defense and general civil litigation.

Over the past 25 years Surane has litigated hundreds both bench and jury trials. Over the past 8 years, he has tried over 75 cases involving foreclosure defense and bank lawsuits, many of which resulted in very favorable outcomes for his clients. In addition to litigation, Surane manages a real estate closing department and understands the legal intricacies of title and closings. The real estate closing department has closed several thousand loans for clients.

Contact:

Attorney James W. Surane

18825 West Catawba Avenue, Suite 150

Cornelius, NC 28031

(O) 704.895.5885

(F)  866.410.6311
ssurane@suranelawpllc.com

Website: www.suranelawpllc.com

 

 

Who is the Creditor? NY Appellate Decision Might Provide the Knife to Cut Through the Bogus Claim of Privilege

The crux of this fight is that if the foreclosing parties are forced to identify the creditors they will only have two options, in my opinion: (a) commit perjury or (b) admit that they have no knowledge or access to the identity of the creditor

Get a consult! 202-838-6345

https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments.
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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see http://4closurefraud.org/2016/06/10/opinion-here-ny-court-says-bank-of-america-must-disclose-communications-with-countrywide-in-ambac-suit/

We have all seen it a million times — the “Trustees”, the “servicers” and their agents and attorneys all beg the question of identifying the names and contact information of the creditors in foreclosure actions. The reason is simple — in order to answer that question truthfully they would be required to admit that there is no party that could properly be defined as a creditor in relation to the homeowner.

They have successfully pushed the point beyond the point of return — they are alleging that the homeowner is a debtor but they refuse to identify a creditor; this means they are being allowed to treat the homeowner as a debtor while at the same time leaving the identity of the creditor unknown. The reason for this ambiguity is that the banks, from the beginning, were running a scheme that converted the money paid by investors for alleged “mortgage backed securities”; the conversion was simple — “let’s make their money our money.”

When inquiry is made to determine the identity of the creditor the only thing anyone gets is some gibberish about the documents PLUS the assertion that the information is private, proprietary and privileged.  The case in the above link is from an court of appeals in New York. But it could have profound persuasive effect on all foreclosure litigation.

Reciting the tension between liberal discovery and privilege, the court tackles the confusion in the lower courts. The court concludes that privilege is a very narrow shield in specific situations. It concludes that even the attorney-client privilege is a shield only between the client and the attorney and that adding a third party generally waives that privilege. The third party privilege is only extended in narrow circumstances where the parties are seeking a common goal. So in order to prevent the homeowner from getting the information on his alleged creditor, the foreclosing parties would need to show that there is a common goal between the creditor(s) and the debtor.

Their problem is that they can’t do that without showing, at least in camera, that the identity of the creditor is known and that somehow the beneficiaries of an empty trust have a common goal (hard to prove since the trust is empty contrary to the terms of the “investment”). Or, they might try to identify a creditor who is neither the trust nor the investors, which brings us back to perjury.

Self Serving Fabrications: Watch for “Attorney in Fact”

In short, the proffer of a document signed not by the grantor or assignor but by a person with limited authority and no knowledge, on behalf of a company claiming to be attorney in fact is an empty self-serving document that provides escape hatches in the event a court actually looks at the document. It is as empty as the Trusts themselves that never operated nor did they purchase any loans.

Get a consult! 202-838-6345

https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments.

If you had a promissory note that was payable to someone else, you would need to get it endorsed by the Payee to yourself in order to negotiate it. No bank, large or small, would accept the note as collateral for a loan without several conditions being satisfied:

  1. The maker of the note would be required to verify that the debt and the fact that it is not in dispute or default. This is standard practice in the banking industry.
  2. The Payee on the note would be required to endorse it without qualification to you. Like a check, in which you endorse it over to someone else, you would say “Pay to the order of John Smith.”
  3. The bank would need to see and probably keep the original promissory note in its vault.
  4. The credit-worthiness of the maker would be verified by the bank.
  5. Your credit worthiness would be verified by the bank.

Now imagine that instead of an endorsement from the payee on the note, you instead presented the bank with an endorsement signed by you as attorney in fact for the payee. So if the note was payable to John Jones, you are asking the bank to accept your own signature instead of John Jones because you are the authorized as an agent of John Jones.  No bank would accept such an endorsement without the above-stated requirements PLUS the following:

  1. An explanation  as to why John Jones didn’t execute the endorsement himself. So in plain language, why did John Jones need an agent to endorse the note or perform anything else in relation to the note? These are the rules of the road in the banking and lending industry. The transaction must be, beyond all reasonable doubt, completely credible. If the bank sniffs trouble, they will not lend you money using the note as collateral. Why should they?
  2. A properly executed Power of Attorney naming you as attorney in fact (i.e., agent for John Jones).
  3. If John Jones is actually a legal entity like a corporation or trust, then it would need a resolution from the Board of Directors or parties to the Trust appointing you as attorney in fact with specific powers to that completely cover the proposed authority to endorse the promissory note..
  4. Verification from the John Jones Corporation that the Power of Attorney is still in full force and effect.

My point is that we should apply the same rules to the banks as they apply to themselves. If they wouldn’t accept the power of attorney or they were not satisfied that the attorney in fact was really authorized and they were not convinced that the loan or note or mortgage was actually owned by any of the parties in the paper chain, why should they not be required to conform to the same rules of the road as standard industry practices which are in reality nothing more than commons sense?

What we are seeing in thousands of cases, is the use of so-called Powers of Attorney that in fact are self serving fabrications, in which Chase (for example) is endorsing the note to itself as assignee on behalf of WAMU (for example) as attorney in fact. A close examination shows that this is a “Chase endorses to Chase” situation without any actual transaction and nothing else. There is no Power of Attorney attached to the endorsement and the later fabrication of authority from the FDIC or WAMU serves no purpose on loans that had already been sold by WAMU and no effect on endorsements purportedly executed before the “Power of Attorney” was executed. There is no corporate resolution appointing Chase. The document is worthless. I recently had a case where Chase was not involved but US Bank as the supposed Plaintiff relied upon a Power of Attorney executed by Chase.

This is a game to the banks and real life to everyone else. My experience is that when such documents are challenged, the “bank” generally loses. In two cases involving US Bank and Chase, the “Plaintiff” produced at trial a Power of Attorney from Chase. And there were other documents where the party supposedly assigning, endorsing etc. were executed by a person who had no such authority, with no corporate resolution and no other evidence that would tend to show the document was trustworthy. We won both cases and the Judge in each case tore apart the case represented by the false Plaintiff, US Bank, “as trustee.”

The devil is in the details — but so is victory in the courtroom.

Pennymac Forgeries Produce Some New Law

Pennymac tried to outwit the court system, succeeding at the trial level and then failing on appeal. The simple fact is that it is a rare instance where a party can lose a lawsuit based upon a forged instrument. The court will (and should) always find a way to deny such relief.

see sanabria-v-pennymac-mortgage-investment-trust-holdings-i-llc

Simple case. Closing attorney still had copy of the note — 5 pages. Pennymac sued on a 6 page note. Defendants denied that the note was real and denied they signed the document upon which Pennymac was relying. Pennymac said that Florida statutes required Defendants to file a cause of action to get rid of a forged document. The trial court agreed. The appellate court said no, the authenticity of the document and the signature is put in play once it is apparent to all that this the gravamen of the defense.

Florida Statutes 673.308.1 reads in relevant part: [Note §673 is UCC Article 3]

In an action with respect to an instrument, the authenticity of, and authority to make, each signature on the instrument is admitted unless specifically denied in the pleadings. If the validity of a signature is denied in the pleadings, the burden of establishing validity is on the person claiming validity, but the signature is presumed to be authentic and authorized unless the action is to enforce the liability of the purported signer and the signer is dead or incompetent at the time of trial of the issue of validity of the signature.

Pennymac Trust likens the statute’s passing reference to “specifically” denying a signature’s authenticity to the specificity required to plead a cause of action for fraud under Florida Rule of Civil Procedure 1.120(b): “In all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with such particularity as the circumstances may permit.”

So as long as you don’t contest the signature specifically there is an iron clad presumption that you signed it. If the facts fit, then deny or set forth an answer or affirmative defense that specifically denies you signed it. But the word of caution here is that denying it doesn’t do you any good if you don’t have some pretty hard evidence, like this case, that shows that the document and/or the signature is not authentic. In this case the proof was straightforward.

BUT notice that the obvious nature of the forgery, fraud upon the court still somehow managed to escape the Plaintiff Pennymac and the attorneys for Pennymac. I wonder when someone important will look at that and say that is not the way to practice law.

 

 

Objection! The timeliness and substance of trial objections

if you don’t make the timely objection, you have not only waived the objection and let in untrustworthy evidence, you have also waived the most important issues on appeal.

Get a consult! 202-838-6345

https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments. We DO provide consulting services for attorneys headed into a contested hearing or trial. The cost is minimal compared to losing.
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You might want to pick up a copy of Dombroff’s Book on trial objections. This is something that most lawyers have not mastered even if they have been practicing for 25 years or more. Besides excluding “bad” exhibits and testimony it teaches the homeowner and the lawyer how to build a case so your evidence won’t be excluded or ignored. I mention this because many lawyers watching me in trial have said the same thing — they never realized how important trial objections were. In Orlando, last month, when I was done, and the Plaintiff rested, I rested and won the case because virtually none of their testimony or exhibits came into evidence. My most esteemed colleague, Patrick Giunta was co-counsel.You can reach him at 954-928-0100.
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Objections don’t always work that way but it sure does preserve issues on appeal. And it gives you a much better chance of winning either at trial level or appeal.

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The converse is true: if you don’t make the timely objection, you have not only waived the objection and let in untrustworthy evidence, you have also waived the most important issues on appeal.

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Timeliness and guts are the key. If the lawyer says something like “I don’t like to make a lot of objections because it will piss of the judge,” run like hell. The Judge is already pissed off and the judge is already starting with the premise that the homeowner is a deadbeat and the judge is very far from thinking that the party seeking foreclosure is just an ordinary thief with a big name. The Judge already thinks that is a big waste of time and that the trial should last 2 minutes. If you concede that position you have already lost and will lose the appeal 9 out of 10 times.

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As for timeliness, most lawyers raise their blanket objection after all the objectionable questions have been asked and answered. That is called waiver of objections in trial practice. I don’t know why lawyers do it. When the judge overrules the objection the homeowner doesn’t know that the lawyer should have been doing squats, rising up with almost every question asked with “Objection! hearsay” or Objection? Lack of foundation” or “Objection! Leading” or “Objection! best evidence”.

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We want to preserve objections for trial if there is a trial order that says that the parties shall exchange exhibits by a certain date before trial and they shall disclose their objections at that time. And one thing I learned again last month — judges don’t appreciate it when the opposing lawyers “change an order” when they agree on a different set of rules or timing. So if you have a judge that is a stickler for the rules, any agreement that you make with opposing counsel that conflicts with an order is probably going to be ignored.

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Of course just because an exhibit or testimony is allowed into evidence doesn’t mean it is automatically taken as true. It can be given zero credibility by the trier of fact. But that relies heavily on your ability to persuade the person sitting on the bench as the trier of fact.
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See also the digital version of The Guerilla Guide to Trial Objections. On Amazon Kindle. Very inexpensive.

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THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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ABSENCE OF CREDITOR: Breaking Down the Language Of The “Trust”

The problem with all this is that the REMIC Trust never received the proceeds of sale of the MBS and therefore could not have paid for or purchased any loans. It had no assets. And THAT is why the Trust never shows up as a Holder in Due Course (HDC).  HDC is a very strong status that changes the risk of loss on a note. Under state law (UCC) of every state alleging and proving HDC status means that the entire risk shifts to the maker of the note (the person who signed it) even if there were fraudulent or other circumstances when the note was signed.

Get a consult! 202-838-6345

https://www.vcita.com/v/lendinglies to schedule CONSULT, leave message or make payments.
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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A reader pointed to the following language, asking what it meant:

The certificates represent obligations of the issuing entity only and do not represent an interest in or obligation of CWMBS, Inc., Countrywide Home Loans, Inc. or any of their affiliates.   (See left side under the 1st table –  https://www.sec.gov/Archives/edgar/data/906410/000114420407029824/v077075_424b5.htm)

If an “investor” pays money to the underwriter of the issuance of MBS from a “REMIC Trust” they are getting a hybrid security that (a) creates a liability of the REMIC Trust to them and (2) an indirect ownership of the loans acquired by the trust.

The wording presented means that only the REMIC Trust owes the investors any money and the ownership interest of the investors is only as beneficiaries of the trust with the trust assets being subject to the beneficiaries’ claim of an ownership interest in the loans. But if the Trust is and remains empty the investors own nothing and will never see a nickle except by (a) the generosity of the underwriter (who is appointed “Master Servicer” in the false REMIC Trust, (b) PONZI and Pyramid scheme payments (I.e., receipt fo their own money or the money of other “investors) or (c) settlement when the investors catch the investment bank with its hand in the cookie jar.

The wording of the paperwork in the false securitization scheme reads very innocently because the underwriting and selling institutions should not be the obligor for payback of the investor’s money nor should the investors be allocated any ownership interest in the underwriting or selling institutions.

The problem with all this is that the REMIC Trust never received the proceeds of sale of the MBS and therefore could not have paid for or purchased any loans. It had no assets. And THAT is why the Trust never shows up as a Holder in Due Course (HDC).  HDC is a very strong status that changes the risk of loss on a note. Under state law (UCC) of every state alleging and proving HDC status means that the entire risk shifts to the maker of the note (the person who signed it) even if there were fraudulent or other circumstances when the note was signed.

By contrast, the allegation and proof that a Trust was a holder before suit was filed or before notice of default and notice of sale in a deed of trust state, means that the holder must overcome the defenses of the maker. If one of the defenses is that the holder received a void assignment, then the holder must prove up the basis of its stated or apparent claim that it is a holder with rights to enforce. The rights to enforce can only come from the creditor, directly or indirectly.

And THAT brings us to the issue of the identity of the creditor. This is something the banks are claiming is “proprietary” information — a claim that has been accepted by most courts, but I think we are nearing the end of the silly notion that a party can claim the right to enforce on behalf of a creditor who is never identified.

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