New Jersey Court Invokes Golden Chicken of Law

Not only did this court get it wrong, it apparently knew it was getting it wrong and so ordered that the case could not be used as precedent.

Steve Mnuchin, now Secretary of our Treasury, was hand picked by the major banks to lead a brand new Federal Savings Bank, called OneWest, which was literally organized over a single weekend to pick up the pieces of IndyMac. By the time of its announced failure in the fall of 2008 IndyMac was a thinly capitalized shell  conduit converted from regular commercial banking to a conduit to support the illusion of securitization.

The important part is that in terms of loans IndyMac literally owned as close to nothing as you could get. OneWest consisted of a group of people who don’t ordinarily invest in banks. But this was irresistible. Over the shrieking objections of FDIC chairwoman who lost her job, OneWest was allowed to claim (a) that it owned the loans that IndyMac and “originated” and (b) to claim 80% of claimed losses which the FDIC paid.

see OneWest “Wins” Again

Thus OneWest claimed losses vastly exceeding the “investment” by certain members of the 1% whom I won’t name here. This enabled them to do 2 things. Claim 80% of the fictitious losses from loans that were not owned by Indymac and the foreclose to collect the entire amount.

Mnuchin was put in charge of “operations.” He ran nothing and basically did as he was told. He knew that the IndyMac residential loan portfolio was at practically zero, he knew that the 80% claim was fictitious, and he knew that neither IndyMac nor OneWest, its supposed successor owned the loans. Nonetheless the “foreclosure king” was entirely happy with foreclosing on homeowners who were caught in a world of spin.

The investors in the OneWest deal split the spoils of war. To be fair they didn’t actually know the truth of the situation. Mnuchin painted a very rosy profit picture that would happen over the short-term and he was right.

As with WAMU, Countrywide et al, the business of IndyMac was largely run through remote vehicles posing as mortgage brokers, originators or just sellers. These entities did exactly what IndyMac told them to do and in so doing IndyMac was doing exactly what it was told to do by the likes of Merrill Lynch, and indirectly Bank of America, Chase, Goldman Sachs, and Citi.

As the descriptive literature on securitization says, all vehicles are remote and special purpose so as to protect everyone else against allegations of wrongdoing. But there was nothing remote about these companies. Yet here in this decision in New Jersey the court predicated its ruling on the proposition that none of the players were liable for any of the unlawful activities of their predecessors.

It’s decisions like this that leave us with the knowledge that we have a long way to go before the courts get curious enough to apply the law as it is — not as the courts and others say it is.

How Do We Know That the Name of the Trustee was Rented?

The practice of paying a fee to a “service provider” to conceal the real nature of a transaction and the real parties in interest has been at the center of all Wall Street schemes that are at variance from conventional loan products.

Virtually all parties who appear in the chain of title or possession in securitization schemes are parties who rent their name to lend credence to the illusion of the loan transaction, loan transfers and foreclosures.

The truth is simply that the debt is never purchased and sold in such circumstances. But paper is created to create the illusion that “the loan” has been purchased and sold. It wasn’t. This illusion is created by simply using the names of the biggest banks in the world.

See Rent-A-Name popular amongst banks

So Payday lenders, the bottom feeders of an already corrupt lending industry, are renting the names of Native American tribes in order to escape rules and laws that apply to lending in general and Payday lenders in particular. They do it because the tribes might be exempt from certain Federal laws and rules. This enables them to charge higher and higher “interest rates” that are in fact gouging American consumers. So the tribal name or jurisdiction is invoked and the lenders pretend that they are not the real parties in interest. More pretender lenders.

This is what happens when we don’t enforce the existing laws and rules in the first place for fear of angering or collapsing the major banks. The prevailing view is that collapsing the TBTF banks — i.e., putting them out of business — is a bad thing no matter how badly they behave.

In the case of REMIC Trusts, big name banks have a tacit and express agreement (which should be pursued in discovery) in which they each will allow their names to be used or rented for a fee. This cross pollination of names, makes it appear that the giant banks are in fact the injured parties in foreclosures. I can say with 100% certainty this is not the case where claims of securitization are involved.

Banks have been quick to point out when faced with judgments for costs, fees or sanctions that they are NOT the foreclosing party and that their name only appears as “Trustee” of a self-proclaimed REMIC Trust. The “party” is the REMIC Trust itself, they say. But when you peek under the hood, the named Trust is just that — only a name. There is no trust and there have been no transactions in which the nonexistent trust’s name has been involved wherein loans have been purchased — or in which anything has been purchased.

Logic dictates and data confirms that the reason for this lack of transactional data is that there were no such transactions. Logic further dictates that the only possible conclusion is that the “investor money” was never entrusted to the falsely named big bank, as trustee and therefore could not have been entrusted to the REMIC Trust. Hence a key element of any valid trust is missing — the active management by a named trustee of assets that were entrusted tot he trustee on behalf of beneficiaries.

So there is no trust and there is court jurisdiction to grant relief in the name of a nonexistent trust. Reading the so-called trust instrument (Pooling and Servicing Agreement) also reveals the absence of trustor/settlor. So not only is the putative trust empty, it also lacks a trustor and trustee. Further inquiry into the PSA and the indenture for the the fake RMBS certificates reveals that the investors are not beneficiaries of a trust because even if the trust existed, the indenture disclaim such an interest in compliance with the buried description in the PSA.

So there is no trust, no trustee, no trustor, and no beneficiary. The investors’ only interest is in the form of a constructive trust, shared with other investors who may or may not be in the same “pool”. The opportunity for commingling money from thousands of investors in multiple pools is just too good for the bank to pass up.

Thus the laws and rules governing the highly complex lending marketplace require only an illusion of compliance instead of the real thing. Court administrators justified their “rocket dockets” by judicial economy and expediency, requiring the courts to hire more judges and personnel. But that is only true if the foreclosure were real. Some courts have required that the original note must be filed with the court upon suit and others require an affidavit describing possession and ownership of the so-called loan documents. Some affidavits must be executed by the lawyers seeking foreclosure on behalf of their clients.

My question is if the trust does not exist except in the minds of certain financiers and there are no trust assets and no active management of them (obviously) then how truthful is it for any lawyer  to execute documents for filing in court on behalf of a client that the lawyer knows or should know does not exist?

 

Questions to Ask About the Trust and the Trustee

In the final analysis you are looking for evidence of absence of any real events currently presumed as facts in any foreclosure case.

The trustee issue is a jurisdictional issue. If the Plaintiff Trust does not exist, then it has no standing to make or pursue any claims. If the named Trustee is not engaged in the active management of active trust affairs on behalf of the beneficiaries of a trust, then it is not a trustee imbued with the powers to administer assets that have not been conveyed and entrusted to the Trustee.
 *
If the named beneficiaries have received a promise from the named “Trust” and the beneficiaries have expressly disclaimed any interest in the “underlying” loans, notes, mortgages or debts, then they are not beneficiaries and the entity is not a trust. (That fact pattern describes individual contracts with each investor who purchased a promise to pay executed by someone allegedly on behalf of an entity self proclaimed as a trust. If the named entity does not exist then the party who executed the isntruments may have liability for the promise).
 *
Since the Trust has not been identified as having been organized and existing under the laws of any jurisdiction, it is entirely appropriate to ask questions about the existence of the trust and its right to do business in the state or the courts. The second jurisdictional issue is subject matter jurisdiction in which the question is whether the trust owns the indebtedness. I frequently deal with these issues in drafting the substance of documents to be filed with the court, subject to opinion of local counsel.
 *
If prior demands for discovery are clear the appropriate strategy is to force the issue through a motion to compel. Filing an “amended” request fro discovery probably starts the clock all over again. By the time you get to a demand for sanctions for contempt the case could be over. If it is denied she should consider an interlocutory appeal on the issue of whether the record contains assertions or evidence of the existence of the trust. The only prejudice that could exist would be that the trust doesn’t exist and that “they” (actually the lawyers) would be “prejudiced” because they couldn’t foreclose using the trust name.
 *
There is no doubt in my mind that one or both narratives are true: (1) the trust doesn’t exist and never did and (2) the loan (i.e., the indebtedness) was never purchased by the trust, acting through tis alleged trustee.
 *
One of the problems here is that it would be wise, although not essential, to notice the named Trustee for deposition duces tecum. That’s often a problem because most homeowners not appear to have anyone competent to conduct the deposition. In a normal deposition, one MUST ask the witness identifying questions like
  1. What’s your name?
  2. Who do you work for?
  3. What is the relationship between your bank and this trust?
  4. Besides the alleged Prospectus and the alleged PSA, what agreements exist wherein the Trustee bank is obligated to do or receive anything from the trust, directly or indirectly. [This one should be broken up into parts].
  5. Under what jurisdiction was the trust organized?
  6. Under what jurisdiction is the trust now existing?
  7. Who is the trust officer for the trust?
  8. In which department(s) are trust matters generally handled in the Trustee Bank?
  9. In which department(s) are trust matters usually handled in the Trustee Bank for this trust?
  10. Has the Trustee bank published any memos or guidelines concerning the administration of securitization trusts?
  11. Assuming that the word “loan” means the indebtedness of the homeowners here in this case, on what date did US Bank as trustee purchase this loan to hold in trust?
  12. Who was the seller of the debt in that transaction?
  13. Was payment for the loan performed through a financial account held in the name of the Trustee for the alleged trust?
  14. How did US Bank as Trustee for the alleged trust perform due diligence to confirm the existence and ownership of the debt?
  15. Who are the beneficiaries of the alleged trust?
  16. Who is the trustor or settlor of the alleged trust?
  17. What is the date and name of the instrument that purports to create the trust?
  18. Describe the current functions of US Bank as trustee of the alleged trust.
  19. Describe the current assets of the alleged trust.
  20. Describe date and content of the last financial report received by US Bank as trustee for the alleged trust.
Most likely opposing counsel will object to the question’s relevancy at the time deposition is taken. But relevancy is not even a question at deposition which is by nature a fishing expedition. Even if opposing counsel was right that the question does not directly relate to proof of a fact asserted at trial, you are still entitled to inquire because it might lead to the discovery of admissible evidence.

TONIGHT! Aggregation and Assignments on the Neil Garfield Show

Are Assignments Based Upon Aggregated Pools Real?

Thursdays LIVE! Click in to the The Neil Garfield Show

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

East-West: Charles Marshall California Attorney co-hosts the discussion

 

The bottom line is that the courts are not accepting denials of assertions or allegations by the foreclosing party. The courts are requiring the homeowner to file an affirmative defense rather than simply denying everything in the complaint. This forces the burden of proof and burden of persuasion onto the homeowner to come up with facts supporting their denial. These facts are within the sole care, custody and control of the party initiating foreclosure.

Through the magic of writing things down on paper anyone can make anything seem like it might be real. Of course in the legal system it goes further than that. If it is written there are many assumptions and presumptions that arise simply because a piece of paper was produced with some writing on it. But nobody ever intended such writing to be used in lieu of facts that are contrary to the truth.

The first place you see this scheme in operation is in the supposed aggregation of loans. The truth is that the DATA for the loans was aggregated, which only means that information ABOUT the supposed loans was taken from several spreadsheets and combined into one.

This is done all the time when a PROPOSED deal is in the works. The aggregation of the data is known as a pro forma presentation — with all parties knowing that it isn’t real, but here is what it might look like if we really did it.

The banks have elevated pro forma spreadsheets into the illusion of actual deals. The reason nobody has ever come up with a money trail showing that the aggregation took place and was sold to a trust is that no such money trail exists.

The truth is that no actual aggregation took place and there was no sale to the trust. In fact probing the trusts, there is never a time that the trust is actually created by entrusting money or property to the named Trustee. Without that there is no Trust because nothing is held “in trust.”

The money from investors is never held by the Trustee. The loan debt is never owned by the Trustee or the Trust. There is no sale. And that is because the Broker Dealers funded the loans in the first place using the money of investors.

So there was nobody to pay for purchase of the underlying debt except the investors and the banks certainly were not going to pay for the underlying debt by handing the investors a check or wire transfer.

How did they do it? Through the illusion of Assignments and endorsements by entities and people who have no ownership interests or other rights to the underlying debt. Even servicing relies upon authority from a trust that does not exist and which neither owns the paper nor the underlying debt.

Let’s go back to the beginning. For ANY deal to be legally binding you need the following elements:

  1. An offer of terms by A to B.
  2. Acceptance of those exact terms by B.
  3. Now you have an agreement but not a contract (yet).
  4. Memorialization of the contract in writing.
  5. The contract is not enforceable until the parties sign
  6. The Closing: Reciprocal consideration is exchanged.
  7. Now you have an enforceable contract.

The only thing we get with assignments and endorsements on supposed “allonges” is #4 — Memorialization in Writing. There is no evidence or even assertion that any of the other things happened. Hence the foreclosing party is using an unenforceable false memorialization of a transaction (transfer of loan paper and no transfer of the underlying debt) that never occurred in order to create the illusion of a foreclosure by a real party in interest.

This is all basic Black Letter law. Yet the courts have routinely ignored several very specific laws governing loans, notes, mortgages and assignments and endorsements. Judges have routinely assumed and even presumed that the paper memorialization was all they needed. The door to moral decay and hazard was opened wide. And we all experienced the shock of seeing our economy nearly turn on its belly.

Now Congress is in the process of rolling back the safeguards so that the investment banks can return to business as usual — transforming the role of banks from being financial intermediaries into some multi-headed hybrid creature that can steal money and homes. The banks can do this by using ordinary deposits by its customers, or by soliciting new deposits with the false promise that the money is actually going into a Trust where a big name bank like US Bank will watch over it.

How do you stop it? By litigating on the strategy and narrative that there is no meat in the sandwich, no deal that ever occurred in real life and no authorized intermediary whose claim is solely based upon the existence of a nonexistent trust and nonexistent transactions in which the underlying debt was bought and sold.

 

FREE Information, Resources and Help with Your Mortgage Loans – Over 13,000,000 Visitors

WELCOME TO LIVINGLIES

NEW PILOT VIDEO:

How To Use the TERA Report by LendingLies.com

GO TO LENDINGLIES to order forms and services

Thursdays LIVE! Click in to the The Neil Garfield Show

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

About Neil F Garfield

Schedule Private Consultation

Purchase Services and Products

Purchase Seminars

Submit Case Interview Form – Receive Customized Recommended Services

Q & A – What can you do for me?

Contact Information:

The Garfield Firm

GTC Honors, Inc.

Phone: 954-451-1230

Email: info@lendinglies.com

Services include: Expert Consultative Services, Strategy, Qualified Written Requests, Case Review and Reports, Forensic Analysis Referrals, and our Title and Encumbrance Analysis.

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. I provide paid services, books and products that enable us to maintain an infrastructure to provide a voice to the victims of Wall Street corruption.

Ask about our CONSULTATION SERVICES and LITIGATION SUPPORT.

Case reviews by Neil Garfield available. Litigation and Expert Consulting in all fifty states.

Educate Yourself and Your Lawyer: Read this Blog and Purchase Books & Services from our Online Store

  • GET A CONSULT WITH NEIL GARFIELD
  • PARALEGAL SERVICES
  • GET A REVIEW AND REPORT ON STATUS AND STRATEGIES
  • GET our Rescission Package
  • GET Litigation support
  • Get our COMBO Title and Securitization Report
  • FREE! Select recent articles from the right side of this page!

RECOMMENDED READING:

WHOSE LIEN IS IT ANYWAY? by Neil F Garfield. E-Book available on our online store.

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

Homeowners Sue SPS in Class Action Over Failure to Mitigate

Thousands of cases like this one have pointed out that SPS and other servicers like Ocwen do not consult with any investor, do not evaluate the case for settlement, modification or mitigation. The answer to questions arising from the unwillingness of those companies to comply with law stems from the fact that the  vast majority of their income comes from undisclosed third parties (the TBTF Banks).

TBTF Banks (BofA, Chase, Wells Fargo, Citi, etc.) do not want settlements or modifications or anything that will make the loan start performing. Subservicers like SPS and Ocwen are used as conduits to other conduits that provides window dressing for claims of compliance or efforts to comply.

Contrary to common sense nobody wants a settlement or modification. The players would rather have the value of the alleged loan reduced to zero or less in the case of foreclosures requiring the bank to maintain the property without any hope of selling it. Common sense says that faced with a value of ZERO versus a value of $200,000, for example, any normal business would select the obvious —- $200,000.

The most extreme cases are where the modification is deemed approved and a new servicer comes in to dishonor it and forecloses, even though the homeowner made the trial payments. Yet Petitions to Enforce the modification agreement are rare; but when they are filed they are usually successful. And in many of those cases the modification is modified for a greater principal reduction than was originally offered.

GET A CONSULT

FREE RESEARCH: Go to our home page and enter subject in search bar.

GO TO LENDINGLIES to order forms and services. Our forensic report is called “TERA“— “Title and Encumbrance Report and Analysis.” I personally review each of them for edits and comments before they are released.

Let us help you plan and draft your answers, affirmative defenses, discovery requests and defense narrative:

954-451-1230 or 202-838-6345. Ask for a Consult.

REGISTRATION FORM: You will make things a lot easier on us and yourself if you fill out the registration form. It’s free without any obligation. No advertisements, no restrictions. The consult is important to determine how we may be of assistance in the drafting and filing of documents in court or complaints directed to law enforcement.

Purchase audio seminar now — Neil Garfield’s Mastering Discovery and Evidence in Foreclosure Defense including 3.5 hours of lecture, questions and answers, plus course materials that include PowerPoint Presentations.

THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.

=====================

Whether or not the class gets certified or settled the suit brings up certain salient points which again give rise to the most common question of all, to wit: “Why is that?”

The answer is hiding in plain sight: None of these parties represent a creditor or owner of the debt . All of them represent undisclosed third parties who are making money hand over fist in the shadow banking market. A completed foreclosure represents the first and only valid legal document in their long train of lies promulgated by piles of fabricated, forged, robo-signed paper. The justice system isn’t always right but it is always final. That is the game the banks are playing.

If SPS or Ocwen actually was set up to help homeowners avoid foreclosure and preserve the value of the loan receivable they would lose virtually all their business. A performing loan would change the makeup of the pools that the players claim to have created. All the re-sales of the same loan would be based upon a loan, even if it existed at one time, that doesn’t exist presently.

So the players NEED that foreclosure not for investors or a trust that doesn’t exist, but for themselves because most of the proceeds of the re-sales of the same loan went the TBTF Banks. They want to preserve their ill-gotten gains rather than do anything that could possibly benefit investors. And the best way they can do that is with an Order or Judgment signed by a duly authorized judge in a court of competent jurisdiction — not with a modification.

Practice Hint: If you see a case that has been ongoing for 8-10 years that is a strong indicator that the investors have received a settlement and no loner have any claim for payment and/or that the “Master Servicer” is continuing to allow payments to investors out of a pool of investor money — i.e., a Ponzi scheme. Those continuing payments have been inappropriately named “servicer advances.” They are not “advances” because it is merely return of investor capital. And since the payments come from an investor pool of cash the payments are not from the servicer since the money came from the same or other investors.

They are called servicer advances because using that name fictitiously allows the “Master Servicer’ (actually the underwriter of the certificates) to claim a “recovery” of “servicer advances.” The recovery is ONLY allowed after sale of the property after a foreclosure where the buyer is a BFP.

So for example if payments to investors attributed to the subject loan are $2,000 per month, 10 years worth of “servicer advances” results in a “recovery claim” of $240,000. Generally that is enough to wipe out any equity. The investors get nothing. The foreclosure was actually for the sole interest and benefit of the banks, not the investors. And the homeowner again finds himself used as a pawn for others to make money over the rotting carcass of what was once his home.

Hence the trial strategy suggested would be drilling down on whether the trust is receiving payment from a “third party,” whether that party has rights of subrogation or is satisfied by some other fee or revenue. If you get anywhere near this issue the bank will fold up like a used tent. They will pay for confidentiality.

Pope Francis: Help from an Unexpected Source — Derivative Markets “Ethically Unacceptable”

Warren Buffett saw it 15 years ago after analysis performed on the derivative markets. He said that the derivatives, as they were then (and now) being used, were “financial weapons of mass destruction.” If he was ignored what chance does anyone else have?

Enter Pope Francis from the perspective of income and wealth inequality and arriving at the conclusion that the aim of the derivative market was to create and trade on poverty and financial distress.

And he called out the financial system as a whole as being a “ticking time bomb,” something that many of us have been saying for years, starting (like Buffett) from before the manifestation of the Ponzi scheme that was ridiculously named “securitization.”

GET A CONSULT

GO TO LENDINGLIES to order forms and services. Our forensic report is called “TERA“— “Title and Encumbrance Report and Analysis.” I personally review each of them for edits and comments before they are released.

Let us help you plan your answers, affirmative defenses, discovery requests and defense narrative:

954-451-1230 or 202-838-6345. Ask for a Consult. You will make things a lot easier on us and yourself if you fill out the registration form. It’s free without any obligation. No advertisements, no restrictions.

Purchase audio seminar now — Neil Garfield’s Mastering Discovery and Evidence in Foreclosure Defense including 3.5 hours of lecture, questions and answers, plus course materials that include PowerPoint Presentations.

THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.

===================================

see – Pope Francis Calls Derivatives and Credit Default Swaps Immoral

The financial markets have long identified themselves as being “amoral.” Just part of the capitalistic system which is code for “if you do it for money, then it’s OK.” Accepting that argument would mean that a perfect defense to a murder charge is that it was based upon the desire to get money.

The Pope assails “unbridled global capitalism.” He isn’t a socialist. The Vatican is merely pointing out that the chaos we call society has tilted the playing field such that capitalism has moved from a system of finance to a system of governance.

Instead of government reigning in and holding the banks accountable for targeting people of low income and people in poverty (along with everyone else) politicians have (a) taken Wall Street assertions as though they were the product of thorough investigation and (b) blamed the victims and forced them to bear the cost of the blow out that only the Wall Street could have created.

Mainstream media succumbed to this phenomenon. They started off with exposes and investigative journalism only to abandon the follow-up that might have educated the consumer population. Some journalists were told point blank to lay off critical pieces on banks. That became increasingly difficult as verdicts and settlements started pouring like rain all based upon fraud, which the Pope references. They were all based upon investigations, administrative findings and allegations from all attorneys general in the country and many if not most of the investors who were duped into buying worthless “certificates” that existed only in the digital world.

The Vatican analysts came to the same conclusion I did in 2006. Dozens of other analysts across the world came to the same conclusion, some before me and most after me.

The conclusion reached by this group of writers and investigators was basically the same although phrased differently, person to person, to wit: virtually all “loans” generated over the past 20 years have been based upon fiction —  a fictional value for the home, a fictional value for the household income (ability to repay) a fictional value for the “certificates” issued by a fictionally named “trust” that was in fact the bank doing business under the fictitious name of the “trust.”

In 2003, Buffett warned of crisis if the government did not intervene in the proliferation of derivative trading and underwriting. The predicted crisis arrived. Now the Vatican is warning of another one perhaps worse than the 2008 crash. Nobody wants to hear that.

Federal and State lending laws state that the responsibility for determining whether the debt will be repaid lies with the bank underwriting the “loan.” Yet the banks were the only entities to come out of the Great 2008 Recession not only whole, but bigger and stronger. The consumer is seen and treated as meat for the hungry bear. Just ask anyone on Wall Street.

Ultimately the responsibility for what governance is acceptable lies with voters. But they only exercise that control when they vote. The status quo is elevating our financial system to a governance system. It leaves the banks in control of most domestic and global issues. Democrats and Republicans are both guilty of the same things: (a) their sole driving  force is retention of power and (b) pushing down fresh new candidates who actually want to accomplish something. The Banks agree.

If you want something different, then VOTE!

 

%d bloggers like this: