By William Hudson
Expecting the United States Government, a for-profit entity, to enforce its own laws against the banks will likely not happen. Numerous leaders and officials of the United States Inc. have already admitted that the banks write the rules. Since the 2008 collapse-the lack of response, the gross violations of due process and the overall impotence of the judiciary, law enforcement and regulatory agencies clearly demonstrates who the U.S. government caters to- and it is not the American homeowner or taxpayer.
Although law does not, at the present time, regard official or governmental corruption as a human rights violation there can be no doubt that inside corruption is as life altering an event as rape, robbery, discrimination or other acts deemed to be illegal and against public policy. Allowing a bank with no standing that has not paid a dime for a property, to foreclose with fabricated documents is a blatant act of corruption.
American homeowners dealing with corrupt loan servicers who strategically engineer defaults are being given free rein to continue their criminal enterprise by the officials and leaders elected to protect. Within the United States, loan servicers are allowed to post payments late, increase arrearages, provide disinformation, deny loan modifications, and manufacture fraudulent documents in which to foreclose- with utter impunity.
The American public has experienced a national awakening that the corruption of the government is a pervasive and pernicious social problem, an obstacle to economic growth and a threat to national security. Both Presidential candidates are currently under investigation for violations of law, and yet the public passively supports the lesser of two evils in either Clinton or Trump.
Although our government has adopted laws and resources for combating domestic foreclosure crime and fraud, the anticorruption laws and processes don’t work because the parties administrating them are committing the same crimes (money laundering, embezzlement, fraud, obstruction of justice, etc.). Sadly, the United States and state governments have actually profited from the settlements with the vulturous banks. For instance, the National Mortgage Settlement did not benefit the American homeowner. The federal and state governments instead diverted the funds to other government programs and a paltry percentage of those funds went to those victimized by fraudulent foreclosure. In fact, to those who lost their homes to fraud, most of the recipients – almost 2 million homeowners – received payments of $300 to $600. This was a gross insult.
It is apparent that no one in government will assist those victimized by predatory lenders and servicers. Therefore it is time to create anti-corruption standards, prioritize anti-corruption enforcement, and insist on improving the lives of those who become victims of corrupt government and business practices. Freedom from official corruption must be a fundamental and inalienable American right if we are to evolve from our current economic and societal dysfunction that is now the norm.
John Locke engineered the concept of American freedom writing:
“The temptation is too great for those who seek power. For those who have the power of making laws, also have the power to execute them. In most cases these same individuals exempt themselves from obeying the very laws they make. In legislation passed by those in power also find ways to exempt their own property from the laws they are charged with enforcing on the rest of society.”
The natural right to be free from official corruption is founded in ancient cultures from Chinese Confucianism to Sharia Jurisprudence- and is often cited as the first principle underlying just governance. Although not officially a human right, governments owe this duty to every human and any violation is an affront to justice, decency and freedom. However, in the past four decades, corruption in both government and corporate enterprises (who are one and the same) has become an accepted governmental practice. However, perhaps a tide is turning- there is a new restlessness and outrage against the American political and legal systems that have allowed millions of Americans to lose their homes when the majority of these homeowners wanted only an opportunity to negotiate in good faith with their lender.
Americans must unite and demand that corruption be defined as a rights violation and demand vigorous enforcement of anti-corruption measures to restore faith in both government and on Wall Street. We are now a nation decimated by corruption. People no longer trust their government to protect their rights but to forcefully eradicate their rights with little oversight or consequence. The American Aristocracy has become the principal cause of human suffering and deprivation in this country and the populace is likely close to the tipping point.
American political theory has not embraced an individual’s right to freedom from official corruption as an inalienable right. The 2008 economic collapse has illuminated how the insidious plague of corruption, unjust courts, and violation of the rule of law result in gross market distortions, revolt against government (passive at this point) and the destruction of life quality among the middle and lower classes. Suicide rates have increased drastically, divorce rates are up, and most people have no savings for an emergency. The American dream is in decline and if another economic collapse occurs- the system will fail. This may not be a bad thing because historically leaps in political thought require a dismantling of the status quo.
The US governments and our political systems have suffered a loss of legitimacy by allowing the big banks to override centuries of American real estate law and influence the judiciary that their fraudulent practices are legitimate. No matter how petty or revolting the crime, our laws must be enforced. The right to honest and transparent mortgage lending, the ownership of property, and a judiciary that protects the victimized party are basic human rights and are no different than the right to contract or to not be subjected to cruel and unusual punishment. If the right to quiet enjoyment and the right to challenge ownership are not upheld, according to law, the foundational principles of our country are at risk.
It was only eight years ago that the financial system crashed. Banks had engaged in a process of lending money at ultra-low interest rates, often with zero-down, on properties that were overvalued. The borrowers were often people who were high risk because they didn’t have established credit or stable job histories. The banks weren’t worried about this practice because they would quickly securitize the loan and pass the risk off to a group of investors, insure their exposure, and bet against the trust to fail. In the past eight years ago the federal government has done nothing to stop the corruption while our officials and the banks profit off the misery of millions of Americans.
Recently the economic indicators look a lot like they did back in 2008 before the crash. If you owe a bank $200,000 and you can’t pay, you have a problem. If several million people owe the banks $200,000 and can’t pay, the banks have a problem. The new subprime bubble may take out the financial system this time around. Remember that back in 2008, the subprime bubble was 1.3 Trillion dollars. Today the negative interest rate bubble is NINE TIMES the size of the 2008 subprime crisis. This bubble won’t pop- it will explode.
Wages are flat, corporations are laying off people, and borrowers are beginning to default on student loans, automobile loans, and very soon, their mortgages. Meanwhile investors are continuing to purchase subprime bonds because they are convinced that governments will guarantee these risky financial instruments. It is naïve to believe that both consumers and governments will be able to pay when financial indicators show both to be grossly over-leveraged. At some point we must deal with the reality of the systematic corruption that permeates our government at all levels.
John Locke’s theory of natural law states that all humans have inalienable and fundamental (some would say God-given) rights in which all people are entitled. Locke’s theory provides the foundation that all humans have a right to be free from official corruption and government extortion.
These concepts outline the human will and a universal desire for freedom. And yet, one of the world’s most progressive governments who has hard evidence that the mega-banks are relying on extortion and fraud to steal homes has refused to convict those who engineered one of history’s most egregious human rights violations- the destruction of home and family. Protecting the US citizen from powerful and corrupt banks is simply not a high priority when the banks dictate policy.
Even if the US government refuses to acknowledge the rights of property owners, natural rights exist irrespective of whether any particular government acknowledges them. Without preventative measures and the enforcement of current law, good governance fails, economic growth will eventually stagnate or move elsewhere, and national security is at risk both domestically and from outside.
For hundreds of years American had some of the most stringent and reliable legal instrument recording systems ever created. Within a decade, the big banks had eradicated the reliability of these record systems by filing fraudulent documents. Legal instruments authenticate ownership and outlined rights of both buyer and seller, but when banks resort to fabrication and forgery to create the illusion of ownership the entire system breaks down.
Examine any third world country where corruption is rampant and you will find limited investment in property or infrastructure because the risk is too high. In these countries, a contract means nothing. Although the United States has not devolved to this level- we are quickly approaching an era where the international community questions our currency, our property protections and the integrity of our legal system to enforce its own laws. The cycle of corruption that now grips our real estate records and foreclosure practices threatens the human rights of Americans by their own leaders.
Academics and researchers worry that pervasive corruption in one area where rights are routinely violated, will result in the compromise of other human rights. When the system breaks down, equality, anti-discrimination, due process and political participation are adversely impacted. The entire system that is based on honor and natural rights decays, and social, economic, and educational rights also become vulnerable to corruption. Faith in government is the underpinning of modern political systems and when the population quits trusting their government, the government typically responds with draconian measures.
What can be done? A holistic strategy should be incorporated that applies the law equally and equitably. If the bank doesn’t have an assignment or uses a fabricated document, that instrument should be considered void and should not be used as proof of standing. The courts routinely make presumptions in favor of the party with the most power and resources when the judge should rule on the evidence and according to law. Until the judiciary is forced to comply with the rule of law, due process and justice are undermined. Unfortunately, our leaders are more interested in government as a means of personal enrichment and maintaining autocratic control than of applying the law equally.
Economists have stated that sustained economic growth is dependent on “social capital”- the trust between the public and the institutions that contribute to a country’s ability to establish production to create new wealth. It is well known that corruption is the primary cause of poor government and economic failure. Therefore, our public officials must be held accountable for their actions and act like our partners- not the perpetrator.
Corruption destroys capitalism. As we have seen at Lending Lies, those who have been victimized by a loan servicer drop out of the system. They become unwilling to purchase another home, borrow funds to start a business, or engage in any activity with a large lender.
John Locke stated that protecting citizens from the abuse of government was about liberty. Locke argues that we can understand the purpose of government by first reflecting on what the human condition is in a natural state when we are all free, equal and possessing liberty. When conflict arises, Locke believes it is government who provides a “common measure to decide all controversies that can cure “those evils which necessarily follow from men being judges in their own cases.” Justice is tainted by self-interest and must be moderated.
Locke believed that “civil society” resulted when a government that is “bound to govern by established standing laws, promulgated and known by the people.” That can hardly be said about the American judicial system that has grown so complex it is beyond the majority’s ability to comprehend is only available to the well-off who can defend their rights.
Government was created to guarantee our natural rights, not to violate them. “For in all the states of created beings, capable of laws, where there is no law there is no freedom. For liberty is to be free from restraint and violence from others, which cannot be where there is no law.” Locke argued that liberty must be common to everyone in a given society, and made by the legislative power, “not to be subject to the inconstant, uncertain, unknown, arbitrary will of another man.”
Thus, our right to liberty can only exist when government does not abuse their public office for personal gain and where there is not corruption. Corruption voids the social contract, destroys our liberty, and destroys civilized society. Eventually, Locke argues, tyranny occurs. America was founded on the promise of “life, liberty and the pursuit of happiness” When a loan servicer is able to steal a home by presenting forged documents and no proof that they paid for a loan; life, liberty and the pursuit of happiness are violated.
In America we are losing the freedoms that were tenets of this great country. We are losing our privacy, our faith in our government, the corporations that place profits above people and an out of control police state that has evolved in the last decade. In societies where corruption is endemic, every aspect of daily life becomes questioned—public education, seeing a doctor, obtaining a driver’s license and paying taxes is questioned.
The United States Constitution, for all intents and purposes has been eroded by those who swore to uphold and defend the Constitution against all enemies domestic and foreign. If our basic property laws are not upheld and our right to possess private property is no longer sacred then the fruits of our labor are no longer ours.
John Locke wrote that “everyman has a property in his person; this nobody has a right to but himself. The labor of his body and the work of his hand, we may say, are properly his.” This is no longer true when your home and your equity in your home can be taken by force by a servicer who did not pay for your loan and cannot provide any credible proof that they own the property. The courts continue to make presumptions in favor of the banks when they have concrete proof that the banks have engaged in criminal activity and fraud. This isn’t supposed to happen in a civilized country.
The bottom line is that people who suffer damage from corrupt lenders and servicers should have an absolute right to initiated legal proceedings against those responsible for that damage. These individuals that suffer not only economic losses, but emotional damages should be compensated for their losses. This is an inalienable right and should be enforced despite an inability to afford expensive litigation. In most foreclosure cases, only those with the financial means to fight back typically can prevail against a corrupt lender – who without fear or consequence deceives the homeowner and judge.
The right for the individual to enjoy possession of their property and the absolute protection of property from being taken through acts of petty and grand corruption are absolute rights. When government refuses to enforce the rule of law, official corruption occurs and should be criminalized. When a judge knowingly and willingly refuses to acknowledge that fraud and corrupt practices are occurring in his/her court room then that judge is complicit in the corruption.
Anti-corruption norms must be created and enforced in this country. Government officials in the legislative and judiciary branches owe us an affirmative duty to be honest and fair towards us or we should opt out of volunteering as citizens. If our elected officials refuse to honor their oaths, protect our human rights or provide conditions that are conducive to economic stability and growth- then the American people have a right to formulate new governance.
We recognize the long history and complex nature of the act of corruption, bribery, and fraud in government and among corporations. Corruption destroys the economy, faith in government and an individual’s freedom and right to due process. Americans have a right to expect government to be honest and responsive as opposed to self-dealing, biased and extortive. At this point in American history it is no longer about individual rights but society’s overall trust in government. Without anti-corruption policies and enforcement of these laws the end result will be diminished productivity, restricted innovation and an impoverishment of the American spirit.
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