Chase-WAMU Letter Reveals”Expungement” and “Assignments” of Alleged Mortgages ” Not on the Books and Records of WAMU”

There is an old saying on Wall Street that “Bulls make money, Bears make money but Pigs never do.” The obvious circumstances of Chase claiming ownership to nonexistent loan portfolios contained within WAMU coupled with the admission in this letter to the FDIC, shows just how arrogant Chase felt when they informed the FDIC that they wanted to get paid by the FDIC for expunging documents and fabricating other instruments for “loans” that were not on the books and records of WAMU at the time of their purchase and sale agreement wherein Chase acquired the WAMU estate.

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 Letter from Chase to FDIC: chase-letter-to-fdic-2014
*
Hat tip to Bill Paatalo who reminded me of this letter that surfaced in the dispute over FDIC indemnification of Chase for the takeover of WAMU operations. Chase expressly admits to defects in the chain of title and erroneous mortgage documentation.
*
It has been central to the defense of foreclosures based upon alleged “loans” originated by Washington Mutual (WAMU) that Chase never acquired any loans. It is obvious from the the transaction where Chase agreed to pay around $2 Billion to the estate but received more than that in a tax refund due to the WAMU estate. So the consideration was zero.
*
Yet Chase has persistently asserted claims of ownership and direct or indirect authority to foreclose on loans that were not in the books and records of WAMU at the time of the FDIC sale to Chase.
Along with several others, I have stated the fact that Chase (1) acquired no loans (2) because they were not in the WAMU portfolio and that (3) a check of the WAMU books and records in the bankruptcy court will not show the loans that Chase says it acquired from WAMU. If WAMU didn’t own them then Chase could not have acquired them from WAMU.
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In order to perpetuate this farce we have alleged that Chase was directly involved in the fabrication and forgery of documents to create the illusion of loans that didn’t exist on WAMU books and records and schedules in the receivership and schedules in bankruptcy.
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Even a non-lawyer can see the problem for Chase. The letter in the link below clearly shows the lawyers asserting a claim for expenses in expunging records (i.e., destroying them) and fabricating other records which obviously leads to the issue of forging since the document itself was knowingly fabricated at the expense of Chase.
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Somehow Chase came to the conclusion that having paid for the destruction of documents and having paid for fabricating documents, they were now entitled to call themselves owner of the “Loan portfolio” which according to the schedules never existed.
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They admit to fabricating documents to create the illusion of a chain of title. Now they want payment from the FDIC to cover the expense of fabrication and forgery. Perhaps more importantly they admit “errors in mortgage documentation occurring prior to September 25,2008.”
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Email from Bill Paatalo:
Neil,
Have you seen this letter? The collusion between JPMC and the FDIC could not be any more transparent.
Excerpts from letter in italics:

The additional matters giving rise to JPMC’s indemnity rights relate to costs incurred in connection with mortgages held by WMB prior to September 25,2008. These costs have resulted from aspects of-and circumstances related to- WMB mortgages that were not reflected on the books and records of WMB as of September 25, 2008, and include:

[HERE IS A DIRECT ADMISSION THAT THERE IS A SCHEDULE OF LOANS “NOT REFLECTED ON THE BOOKS AND RECORDS OF WMB.” IF NO SCHEDULE EXISTS SHOWING WHAT WAS “ON THE BOOKS AND RECORDS,” THEN WE SHOULD NOW INQUIRE AS TO THE SCHEDULE SHOWING THOSE LOANS NOT REFLECTED ON THE BOOKS AND RECORDS.]

(a) Costs incurred by JPMC associated with individual assignments of WMB mortgages. Where JPMC has initiated foreclosures on properties associated with mortgages that were held by WMB prior to its Receivership, JPMC has performed individual assignments of the associated mortgages/deeds of trust and allonges to comply with a recent appellate-level court decision in Michigan so as avoid potential additional expense and/or liability. In so doing, JPMC has incurred additional recording and legal fees, Limited Power of Attorney costs, as well as quantifiable costs associated with increased staffing to address these issues.

[THIS IS A DIRECT ADMISSION THAT ASSIGNMENTS AND ALLONGES ARE BEING EXECUTED BY JPMC (AS BENEFICIARIES AND MORTGAGEES) FOR WMB LOANS THAT WERE “NOT REFLECTED ON THE BOOKS AND RECORDS OF WMB.”]

(c) Costs incurred by JPMC to expunge records associated with WMB mortgages as a result of errors in mortgage documentation occurring prior to September 25,2008, including erroneously recorded satisfactions of mortgages and associated legal fees and disbursements.

[“EXPUNGING RECORDS ASSOCIATED WITH WMB MORTGAGES AS A RESULT OF ERRORS IN MORTGAGE DOCUMENTATION?” THIS IS A DIRECT ADMISSION THE JPMC HAS DESTROYED RECORDS RELATED TO WMB MORTGAGE FILES.]

(d) Costs incurred by JPMC to correct various defects in the chains of title for WMB mortgages occurring prior to September 25, 2008, including recording and legal services fees.

[WHAT “CHAINS OF TITLE?” JPMC TAKES THE POSITION THAT THESE LOANS WERE NEVER SOLD BY WMB. THIS IS A DIRECT ADMISSION THAT JPMC IS ATTEMPTING TO CORRECT DEFECTS IN THE CHAINS OF TITLE FOR WMB LOANS THAT WERE NOT REFLECTED ON THE BOOKS AND RECORDS OF WMB. THESE “CORRECTIONS” UNIVERSALLY INVOLVE ASSIGNMENTS OF BENEFICIAL INTERESTS FROM THE FDIC, AND/OR BY VIRTUE OF THE PAA.]

At the time of WMB’ s closure, the above liabilities were not reflected on its books and records.

Bill Paatalo
Oregon Private Investigator – PSID#49411

BP Investigative Agency, LLC
P.O. Box 838
Absarokee, MT 59001
Office: (406) 328-4075

MERS/GMAC Note and Mortgage Discharged

If only all courts would entertain the possibility that everything presented to them should be the subject of intense scrutiny, 90%+ of all foreclosures would have been eliminated. Imagine what the country would look like today if the mortgages and fraudulent foreclosures failed.

The Banks say that if the mortgages failed they all would go bust and that there is nothing to backstop the financial system. The rest of us say that illegal mortgage lending and foreclosures was too high a price to pay for a dubious theory of national security.

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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I received the email quoted below from David Belanger who, like many others has proven beyond any reasonable doubt that persistence pays off. (BOLD IS EMPHASIS SUPPLIED BY EDITOR)

Besides the obvious the big takeaway for me was what I have been advocating since 2007 — if any company in in the alleged chain of “creditors” has gone out of business, there probably is a bankruptcy involved or an FDIC receivership. Those records are available for inspection. And what those records will show is that the the bankrupt or insolvent entity did not own the debt that arose when you signed documents for the benefit of parties other than the source of funding. It will also show that the bankrupt or insolvent entity did not own the note or mortgage either.

This is instructional for virtually all parties “involved” in a foreclosure but particularly clear in the cases of OneWest, whose entire business plan depended upon fraudulent foreclosures, and Chase Bank who bet heavily on getting away with it and they have, so far. BUT looking at the bankruptcy and receivership filings of IndyMac and WAMU respectively the nature of the fraud was obvious and born out of pure arrogance and apparently a correct perception of invincibility.

All such bankruptcy proceedings and receivership require schedules of assets right down to the last nickle in bankruptcy. Belanger simply looked at the schedule, knowing he never took the loan, and found without surprise that the bankrupt entity never claimed ownership of the debt, note or mortgage.

The big message here though is not just for those who are being pursued in collection for loans they never asked for nor received. The message here is to look at those schedules to see if your debt, note or mortgage is listed. Lying on those forms is a federal felony punishable by jail. Those forms are the closest you are ever going to get to the truth. Odds are your loan is nowhere to be found — even if you did get a loan.

And the second takeaway is the nonexistence of the “trust.” In most cases it never existed. Your “REMIC Trust” was almost certainly formed under the laws of the State of New York or Delaware that permit common law trusts (i.e., trusts that don’t need to be registered with the state in order to exist). BUT uniform trust laws adopted in virtually all states require for the trust to be considered a “person” it needs to have these elements — (1) trustor (2) trustee (3) trust instrument (PSA) and (4) a “thing” (res in Latin) that is committed to the trust by someone who owns the thing. It is the last element that is wholly absent from nearly all REMIC “Trusts.”

And now, David Belanger’s email:

JUST WANTED TO TELL YOU ALL SOMETHING,  THAT I JUST GOT DONE , FROM MERSCORP!  ON OUR PROPERTY THERE WAS A 2d MORTGAGE ON IT, IT WAS A LINE OF CREDIT THAT WE DID NOT DO, AND WE DID REPORT IT TO THE RIGHT AUTHORITY’S, BACK IN 2006/2007. NOW THE COMPANY WAS GMAC MORTGAGE CORP.

OVER THE YRS, FROM 2006 TILL NOW, IT REMAINED ON PROPERTY, UNTIL JUST LAST WEEK, WHEN I DEMANDED THAT MERS DISCHARGE IT.  AND AFTER THEY FOUND OUT IT WAS NEVER ASSIGNED OUT OF MERS, THEY HAD TO DISCHARGE IT. BECAUSE GMAC MORTGAGE IS DEAD.  NOW THIS GO TO WHAT WE ALL HAVE SAID HERE.

ANY ASSIGNMENT THAT HAS NOT BEEN DONE, OR RECORDED AT REGISTRY OF DEEDS, OUT OF MERS, AND THE MORTGAGE COMPANY IS A DEAD MORTGAGE COMPANY. THEN MERS WILL DISCHARGE IT . I HAVE A COPY OF THE DISCHARGE IN HAND.

AM STILL FIGHTING, BECAUSE OF THIS NEWS,  I HAVE ASK MY ATTORNEY TO NO AVAIL TO DO A QWR ON THE COMPANY THAT RECORDED AN ASSIGNMENT IN 2012, EVEN THOUGH GMAC MORTGAGE CORP WAS IN BK AND AFTER GOING THROUGH ALL BK RECORDS OF EACH ENTITY, THAT HAD TO FILE ALL ASSET OF THERE COMPANY, AND FOUND THAT NO ONE IN GMAC HAD THE MORTGAGE AND NOTE, 3 MONTHS PRIOR TO THE ASSIGNMENT BEING PUT ON MY RECORD.
https://www.kccllc.net/rescap/document/1212020120703000000000033

UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW …
http://www.kccllc.net
Southern District of New York, New York In re: GMAC Mortgage, LLC UNITED STATES BANKRUPTCY COURT Case No. 12-12032 (MG) B6 Summary (Official Form 6 – Summary) (12/07)

THIS IS AGAIN THE REASON, THIS FRAUD TRUST  DOES NOT EXIST, AND I DO HAVE ALL SECRETARY OF STATES, INCLUDING ALL STATING THAT  THIS FRAUD TRUST IN FACT HAS NEVER
BEEN REGISTERED IN ANY STATE. LET ALONG THE STATE OF DELAWARE, THE STATE THEY SAY IT IS REGISTERED IN.  THE SECRETARY OF STATE SAID NO. AND HAS NEVER BEEN A LEGAL OPERATING TRUST, EVER. SIGNED AND NOTARIZED BY THE SECRETARY. THE FRAUD TRUST NAME IS AS FOLLOWS.
GMACM MORTGAGE LOAN TRUST 2006-J1,

OneWest’s Mnuchin: Putting the Fox in Charge of the Henhouse

see http://www.npr.org/2016/11/29/503755613/trumps-potential-treasury-secretary-headed-a-foreclosure-machine

There two ways of looking at this prospective appointment by President-Elect Trump.

One is that this appointment signals the intent to further “expedite” foreclosures instead of digging deeper into the real facts and fraud by Wall Street banks. Such an effort would eliminate the possibility of the US Treasury clawing back huge sums of money for nonexistent bank losses stemming from alleged defaulted loans.

Some may remember that the infamous TARP bailout was first described and approved as covering losses from the loans to residential homeowners. Then it evolved.  The description and approval was to cover losses from failed mortgage bonds. But neither defaults nor bond failures were actual losses of the banks.

They had sold the loans and bore no risk. And they were selling bonds not buying them. Then it evolved again. The description and approval was to cover lost profits on hedge products, insurance and credit default swaps, at which point it became a relief program for “troubled assets” which was code for giving the banks additional profit after already having gouged the US economy.

OneWest benefited from a cozy government relationship, over the objections of Sheila Bair, head of the FDIC. Like Chase, Wells Fargo, Citi, BOA and others OneWest acquired servicing rights but also was allowed to take the position that it owned loans acquired from its takeover of IndyMac, which had been addicted to fees generated from apparent “originations.”

The foreclosures that ensued resulted in a windfall profit to OneWest. Mnuchin was the organizer of OneWest, collecting up several billionaires around the country to create OneWest and do the deal with the FDIC in which it created the illusion of buying loans. But OneWest then got out of the business.

So I am reminded of history when FDR appointed one of the worst insiders to Wall Street schemes as first Chairman of the SEC. That was none other than Joseph Kennedy, the father of JFK. Wall Street cheered, being under the mistaken impression that they were free to create more schemes and defraud more people out of what was left in household and individual wealth.

Instead Joe Kennedy took the job seriously and was instrumental in creating numerous reforms and enforcement proceedings that shook Wall Street to its core — giving them pause before initiating some other fraudulent scheme. Republicans have been chipping away at that legacy for decades.

So the other possibility here is that the appointment of Mnuchin might be a replay of the appointment of Joe Kennedy. Mnuchin is the one guy who understands where the bodies are buried and understands how the latest meltdown was triggered by Wall Street fraud. He might be the right one to tackle this unprecedented problem without bringing down the entire financial system. If so, the TBTF banks might be redesignated as TBTE (Too Big To Exist).

If that dream comes true, then homeowners might get the relief necessary to recalibrate the US economy that is 70% dependent upon consumer spending. And it might just be acknowledged by government that what happened was a double blind fraud: institutional investors and individual homeowners were both victims that were entitled to reparations. And perhaps there will be created a mechanism for putting those two groups of victims together to salvage the “asset values” on their books.

The Chase-WAMU Illusion

In the mortgage world “successor by merger” is simply a living lie that continues as you read this article. Like many other major illusions in our world economy, the Chase-WAMU merger was nothing more than illusion

The reason for the rebellion showing up as votes for Sanders and trump and the impending exit of the UK from the European Union is very simple — every few decades the populace gets a ahead of their elected leaders and yanks their leash so hard that some of them choke.

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

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see FDIC_ Failed Bank Information – WASHINGTON MUTUAL BANK – Receivership Balance Sheet Summary (Unaudited)

see wamu_amended_unsealed_opinion

When Bill Clinton was asked how he balanced the budget and came out with a $5 Trillion surplus when he left office his reply was unusually laconic — “Arithmetic.” And he was right, although it wasn’t just him who had put pencil to paper. Many Republican and Democrats had agreed that with the rising economy, the math looked good and that their job was not to screw it up. THAT was left to the next president.

I’m not endorsing Clinton or Trump nor saying that Democrats or Republicans are better that the other. Indeed BOTH major political parties seem to agree on one egregiously erroneous point — the working man doesn’t matter.

The people who matter are those with advanced degrees and who reach the pinnacle of the economic medal of honor when they are dubbed “innovators.”

The reason for the rebellion showing up as votes for Sanders and Trump and the impending exit of the UK from the European Union is very simple — every few decades the populace gets a ahead of their elected leaders and yanks their leash so hard that some of them choke. To say that the BREXIT vote was surprising is the height of arrogance and stupidity. People round the world are voicing their objection to an establishment that doesn’t give a damn about them and measures success by stock market indexes, money supply and GDP activity that is manipulated at this point that it bare little if any resemblance to the GDP index we had come to rely upon, albeit that index was also arbitrarily and erroneously based on the wrong facts.

The fact that large percentages of the populace of many countries around the world are challenged to put food on the table and a roof over their heads doesn’t matter as long as the economic indices are up. But truth be told even when those indices go down, the attitude is the same — working people don’t matter. They are merely resources like gold, coal and oil from which we draw ever widening gaps between the people who run the society and the economy and those who drive the economy and society with their purchases.

In the mortgage world “successor by merger” is simply a living lie that continues as you read this article. Like many other major illusions in our world economy, the Chase-WAMU merger was nothing more than illusion — just like BOA’s merger with BAC/Countrywide (see Red Oak Merger Corp); Wells Fargo’s merger with Wachovia who had acquired World Savings; OneWest’s acquisition of IndyMac;  CitiMortgage acquisition of ABN AMRO, CPCR-1 Trust;  BOA’s merger with LaSalle; Ditech’s acquisition by multiple entities GMAC, RESCAP, Ally,  Walter investment etc.) when DiTech was dead and the name was the only this being traded, and so much more. All these mergers bear one thing in common — they were cover screen for one simple fact: they had not in one instance acquired any loans but then relied on the illusion of the merger to call themselves “successors by mergers.”

Let’s take the example of WAMU. When they went broke they had less than $3 Billion in assets (see link above). This totally congruent with the $2 billion committed by Chase to acquire the WAMU estate form the FDIC receiver Richard Schoppe (located in Texas) and the US Trustee in bankruptcy — especially when you consider the little known fact that Chase received 1/3 of a tax refund due to WAMU.

That share of the Tax refund was, as you might already have guessed, MORE than the $2 billion committed by Chase. whether Chase ever actually paid the $2 billion is another question.But in any event, pure arithmetic shows that the consideration for the purchase of WAMU by Chase was LESS THAN ZERO, which means we paid Chase to acquire WAMU.

This in turn is completely corroborated by the Purchase and Assumption Agreement between WAMU, the FDIC Receiver, the US Trustee in Bankruptcy and of course Chase. On the first page of that agreement is a express recital that says the consideration for this merger is “-$0-.” But before you look up the “Reading Room on the FDIC FOIA cite, here is one caveat: some time after the original agreement was published on the site, a “different” agreement was posted long after WAMU was dead, the US Trustee had been discharged, and the FDCI receiver was discharged as a receiver. The “new” agreement implies that loans were or may have been acquired but does not state which loans or how much was paid for these loans. The problem with the new agreement of course is that Chase paid nothing and was not entitled to nothing, except the servicing rights on some fo those loans.

The so-called new agreement placed there by nobody knows, also stands in direct contrast of the interview and depositions of Richard Schoppe — that if there were loans to sell the principal amount would have been hundreds of billions of dollars for which Chase need pay nothing. I dare say there are millions of people and companies who would have taken that deal if it was real. But Schoppe states directly that the number of assignments was NONE, zero, zilch.

Schoppe also stated that the total amount of loan originations was just under $1 Trillion. And he said that the loan portfolio might have been, at some time, around 1/3 of the total loans originated. Putting pencil to paper that obviously means that 2/3 of all originated loans were either pre-funded in table funded “loans” or that they were immediately sold into the secondary market for securitization. All evidence points to the fact that WAMU never owned the loans at all — as they were table funded  through multiple layers of conduits none of whom were disclosed as required under the Truth in lending Act.  Because the big asset that WAMU retained were (a) the servicing rights and (b) the right to claim recovery for servicer advances. It could be said that the only way they could perfect their claim for “recovery” of “servicer” “Advances” was by acquiring WAMU since Chase was the Master servicer on nearly all WAMU originations.

The interesting point of legal significance is that Chase emerges as the real party in interest even though it it appeared only as the servicer in the background after subsequent servicers were given “powers” of attorney to prevent the new “servicer” (actually an enforcer) from claiming a recovery  for “servicer” “Advances.,” that are recoverable not from the borrower, not from the investor, and not from the trust but in a foggy chaos in which the property was liquidated.

So the assets of WAMU at the time it went belly up was under $3 Billion which means that after you deduct the brick and mortar locations and the servicing rights Chase still got the deal of a lifetime — but one thing doesn’t add up. If WAMU had less than $3 Billion in assets and 99% of that were conventional bank assets excluding loans, then the “value” of the loan portfolio, using FDIC Schoppe estimates was $3 Million. If the WAMU loan portfolio implied by the a,test antics of Chase was true — then Chase acquired $300 BILLION in loans for $3 MILLION. Even the toxic waste loans were worth more than one tenth of one percent.

Chase continues to assert ownership with impunity on an epic scale of fraud, theft and manipulation of the courts, investors and borrowers. The finding that Chase NOT assumed repurchase obligations in relation to the originated loans goes further to corroborate everything I had written here. There seems to be an oblique reference to attempted changes in the “P&A” Agreement, and the finding that the original deal cannot be changed, but the actual finding of two inconsistent agreements posted on the FDIC site is worth investigating. I can assure the reader that I have found and read both.

And lastly I have already published numerous articles on victories in court (one fo which was mine and Patrick Giunta) for the borrower based upon the exact principles and facts written in this article — where the judge concluded that US Bank had never acquired the loan, that the “servicer” in court testifying through a robo-signer had no power over the loan because their power was  derived from Chase who was named as servicer for a REMIC Trust that never acquired the loan nor any rights to the loan.

The use of powers of attorney were found to be inadequate simply because the party who executed the POA had no rights to the money, the enforcement of the loan nor any collection or foreclosure. If Chase had acquired the loan from WAMU they would have won. Their total reliance on deflective legal presumptions based upon presumed fact that were untrue completely failed.

BOTTOM LINE: CHASE ACQUIRED NO LOANS FROM WAMU. Hence subsequent documents of transfer or powers (Powers of attorney) are void.

Schedule A Consult Now!

Farce Behind the Force: JPM and WAMU

For further information please call 954-495-9867 or 520-405-1688.

This article is not a substitute for getting the advice I’m an attorney licensed in the jurisdiction in which your property is located.

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see http://www.ritholtz.com/blog/2013/03/jpm-wamu/

The banks are counting on the fact that the claims of securitization are so complex and convoluted that nobody will be able to state a claim with clarity. Foreclosure defense lawyers across the country are seeing constant fabrications, forgeries, uttering false instruments (assignments, Powers of Attorney), and perjury. Nowhere is this more evident than in the case of J.P. Morgan Chase claiming rights in connection with it’s acquisition of certain assets and liabilities of Washington Mutual (WAMU).

At this point J.P. Morgan Chase has taken so many different positions that are inconsistent with each other that you can find a brief or pleading from J.P. Morgan Chase to support virtually any position that you want to take.

You really need to drill down into these articles and decisions in order to see the fundamental error and illegality of the reporting by the major banks and their actions seeking to enforce defective mortgages despite blatant irregularities at closing and nonexistent transactions where JP Morgan Chase, like other banks, claims to have acquired a particular loan or that a nonexistent or nonperforming trust somehow acquired a loan.

If you look at this article in the link above you will see that JP Morgan Chase has taken multiple inconsistent positions on exactly the same issues. Despite clear language to the contrary, they wish to escape liability for the defective and predatory loan practices directed at unsuspecting homeowners and borrowers; and despite clear language to the contrary, they wish to assert ownership over loans that were already sold into the secondary market and then subjected to claims of securitization that in most cases were false claims.

Josh Rosner wrote an article asking whether the false claims of securitization and violations of the prospectus and PSA would make might dwarf the “Lehman weekend.” The answer is yes. From my perspective it appears that most of the money that went through the banks that were too big to fail, was it illegally and fraudulently collected and then hidden offshore. Many trillions of dollars have been advanced to these Banks that are too big to regulate.

TARP was initially created to prevent massive Bank closings related to losses on mortgage loans. But that didn’t work out because the losses on mortgage loans were not sustained by the mega banks. So they expanded the definition to include mortgage-backed securities. But those losses were not sustained by the mega banks either. So they expanded the definition to include virtually anything in an excuse to pump money into the same banks that had caused the crisis; very few critics were allowed to speak. The critics knew that pumping money into banks that were falsely reporting losses what is going to cause an even greater negative impact on the economy. The economy is driven mostly by consumer spending. This was not rocket science. Countries like Iceland simply reduced household debt and threw the bankers in jail. The result was a robust economic recovery. The cost of reducing the household that would simply accomplished by forcing the banks to absorb the loss that they themselves had created.

The problem we have in our country is that the banks have purchased the government. And those politicians who have not been purchased, Have been scared to death with the prospect a complete failure of government, society and economies. The entire premise of such a crash is completely wrong. While the immediate impact of such a policy inevitably leads to volatility in the securities markets, those movements even out as the outcome becomes clear. More than 7000 Banks and credit unions currently use the exact same backbone four electronic funds transfer and payments; all the banks use the same technology and all of them have access to that technology right now. The fall of the mega banks would simply result in a correction in the marketplace where certain banks have become too large to regulate at had become far too influential with people who call the levers of power in all three branches of government.

The other part of the problem is that we seem to hold those with his enormous wealth in high estimation without regard to their actual character. Most of the people in the mega banks are completely contemptuous of the citizens of our country and the politicians that we have elected. In my opinion, it is urgent that we begin to separate normal commercial depository functions of a bank from the risks taken by investment banking departments. And when those risks turn to wrongful, illegal or criminal behavior the individuals, not just their companies, should be held strictly accountable.

Taking down the mega banks is much simpler than it might appear. The extent of our continuing economic problems is equal to the liability of these banks for damages and to repurchase both loans and alleged mortgage-backed securities that were neither securities nor were they backed by mortgages. If the securities and bank regulators actually performed the due diligence and audits that they were supposed to perform, It would be obvious that the mega banks do not have the assets that they claim to have, and that’s the mega banks have liabilities that are far in excess of what they have reported. In short, the mega banks are insolvent which is exactly why we have the FDIC. An orderly transition of the function of the mega banks to smaller banks that are more susceptible to regulation would end our current crisis and ensure a recovery of our economy.

CA Appelate Decision: Damage Claims Against OneWest Goes to Jury, Summary Judgment reversed

For further information please call 954-495-9867 or 520-405-1688

Sue Rose is my new administrative assistant. Danielle and Geordan do not work for livinglies or the Garfield firm. If you have placed an order which is unfulfilled please call the above numbers.

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see CA Appeals OrderReversesMSJ

This case allows the jury to hear claims against OneWest for fraud, negligent misrepresentation, concealment, promissory estoppel, negligence, wrongful foreclosure, and violation of CA Business and Professional Code.

Here is an example of the obvious: a Judge takes no risk in denying a motion for summary judgment. It is only when the Judge grants summary judgment that there is a risk of reversal. With the current judicial climate changing in favor of borrowers, [including findings that the mortgage was absolutely void (invalid, non-perfected) where a sham nominee like MERS was used], Judges should take note that they are better off getting in front of the new trend and allow borrowers’ claims to be heard in a fair manner, observing the requirements of due process.

If the Banks collapse because they created 100 million invalid mortgages, that is not a problem for the Judge. And, as I have said many times here, there are 7,000 banks and credit unions that can take up whatever falls out of the mega banks as a result of investors and regulators realizing that the mortgages are void, the assets on bank balance sheets don’t exist or are far overvalued, and the liability section of the bank balance sheet is far understated as a result of damage claims like the one featured in this article.

As noted earlier on these pages, the threshold legal question has been reversed. The question now is what difference does it make if the borrower is in default if the foreclosing party had no right to foreclose?  The previous question that I heard hundreds of times from the Judges themselves was incorrect from the beginning. Their question was what difference does it make if the loan was securitized, as long as the borrower is in default? And that is where the dissenting justice in this case also got it wrong. He is still assuming that these loan transactions were in fact consummated as reflected in the alleged loan documents. The underlying assumption of the dissenting judge is obvious: that the loan contracts were fundamentally valid and whatever defects existed could be corrected before or even during foreclosure. NOT TRUE!

Here in this case is an example of how judges are now perceiving the entire loan transaction instead of just the claim of a default. And the result is that this California appellate court decided to let the case go to trial and allow a jury to hear the claims against OneWest, whose behavior was predatory from the start of when they acquired IndyMac business in 2008-2009.

The appellate court reversed the trial judge who had granted Summary Judgment for OneWest — a little plaything organized over a weekend by some of the richest people in the country. On a net basis they paid nothing and made a ton of money off of loss sharing and guarantee payments from the FDIC and and the GSE’s respectively. They also foreclosed on thousands of homes in cases where they had no interest in the loan and no right to foreclose, collect or do anything else with respect to the loan.

The hidden issue here is whether the Judge, having been reversed, will now allow the homeowner’s attorney to probe deep into the dealings of OneWest during discovery. I suspect that the trial judge will allow more liberal discovery after being reversed. And if that happens you might not never hear about this case again — as it joins the tens of thousands of cases that have been settled under seal of confidentiality. Essentially the strategy of the banks is that if they lose, they can always pay off the homeowner to keep the case from being publicized.

FDIC Employee Quits and Goes Public With Complaint Against Chase, WAMU, Citi and two law firms

For further information and assistance please call 954-495-9867 or 520-405-1688

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See Eric Mains Federal Complaint

see Mains – Table of Contents.petition 2 transfer

On Monday Eric Mains resigned from his employment with the FDIC. He had just filed a lawsuit against Chase, Citi, WAMU-HE2 Trust, Cynthia Riley, LPS, WAMU, and two law firms. Since he felt he had a conflict of interest, he believed the best course of action was to resign effective immediately.

His lawsuit, told from the prospective of a true insider, reveals in astonishing detail the worst of the practices that have resulted in millions of illegal foreclosures. Some of his allegations cast a dark shadow over claims of Chase Bank on its balance sheet, as reported to the public and the SEC and the reporting of both Chase and Citi as to their potential liability for wrongful foreclosures. If he is right, and he proves these allegations, much of what Chase has reported as its financial condition will vanish from its financial statements and the liability side of the balance sheets of both Citi (as Trustee) and Chase (as servicer and “owner’) will increase exponentially. This may well have the effect of bringing both giants into the position of insufficient reserve capital and force the government to take action against both entities. Elizabeth Warren might have been right when she said that Citi should have been broken into pieces. And the same logic might apply to Chase.

He has also penned the phrase “wild goose Chase” referring to discovery of the true creditors and processing of applications for modification of loans. And he has opened the door for RICO actions against the banks and individuals who did the bidding of the banks as well as the individuals who directed those actions.

His Indiana lawsuit is filed in federal court. He alleges that

1. WAMU was not the actual lender in his own loan
2. That the loan was part of an illegal scheme from the start
3. That his loan was subject to claims of securitization but that those claims were false
4. That the REMIC Trust was never funded and therefore never had the capacity to originate or buy loans
5. That the intermediaries never followed the law or the documents for securitization of his loan
6. That the REMIC Trust never did purchase his loan
7. That Citi was therefore “trustee” for an unfunded trust
8. That Chase never purchased the loans from WAMU
9. That Chase could not have been the legal servicer over the loan because the loan was not in the trust
10. That Chase has filed conflicting claims as to ownership of the loans
11. That the affidavit of Robert Schoppe, whom Mains worked for, as to ownership of the loans was false when it states that Chase owned the loans
12. That the use of WAMU’s name on the loan documents was a false representation
13. That his loan may have been pledged several times by various parties
14. That multiple payments from multiple parties were likely received by Chase and others on account of the Mains “loan” but were never accounted for to the investors whose money was being used as though it was the Banks themselves who were funding originations and a acquisitions of loans
15. That the industry practice was to reap multiple payments on the same loan — and the foreclose as though there was balance due when in fact the balance claimed was entirely incorrect
16. That the investors were defrauded and that foreclosure was part of the fraudulent scheme
17. That Mains name and identity was used without his consent to justify numerous illegal transactions in which the banks repeated huge profits
18. That neither WAMU nor Chase had any rights to collect money from Mains
19. That Citi had no right to enforce a loan it did not own and had no authority to represent the owner(s) of the loan
20. That the modification procedures adopted by the Banks were used intentionally to force the borrower into the illusions a default
21. That Sheila Bair, Chairman of the FDIC, said that Chase and other banks used HAMP modifications as “a kind of predatory lending program.”
22. That Mains stopped making payments when he discovered that there was no known or identified creditor.
23. The despite stopping payments, his loan balance went down, according to statements sent to him.
24. That Chase has routinely violated the terms of consent judgments and settlements with respect to the processing of payments and the filing of foreclosures.
25. That the affidavits filed by persons purportedly representing Chase were neither true nor based upon personal knowledge
26. That the note and mortgage are void from the start.
27. That Mains has found “incontrovertible evidence of fraud, forgery and possibly backdating as well.” (referring to Chase)
28. That the law firms suborned perjury and intentionally made misrepresentations to the Court
29. That Cynthia Riley “is one overwhelmingly productive and multi-talented bank officer. Apparently she was even capable of endorsing hundreds of loan documents a day, and in Mains’ case, even after she was no longer employed by Washington Mutual Bank. [Mains cites to deposition of Riley in JPM Morgan Chase v Orazco Case no 29997 CA, 11th Judicial Circuit, Florida.
30 That Cynthia Riley was laid off in November 2006 and never again employed as a note review examiner by WAMU nor at JP Morgan Chase.
30. That LPS (now Black Knight) owns and operates LPS Desktop Software, which was used to create false documents to be executed by LPS employees for recording in the Offices of the Indiana County recorder.
31. That the false documents in the mains case were created by LPS employee Jodi Sobotta and signed by her with no authority to do so.
32. Neither the notary nor the LPS employee had any real documents nor knowledge when they signed and notarized the documents used against Mains.
33. Chase and its lawyer pursued the foreclosure with full knowledge that the assignment was fraudulent and forged.
34. That LPS was established as an intermediary to provide “plausible deniability” to Chase and others who used LPS.
35. That the law firms also represented LPS in a blatant conflict of interest and with knowledge of LPS fraud and forgery.

Some Quotes form the Complaint:

“Mains perspective on this case is a rather unique one, as Main is an employee of the FDIC (hereinafter, FDIC) who worked in the Dallas field office of the FDIC in the Division of Resolutions and Receiverships (hereinafter DRR), said division which was the one responsible for closing WAMU and acting as its receiver. Mains worked with one Robert Schoppe in his division, whom the defendant Chase Bank often cites to when pulling out an affidavit Robert signed. This affidavit states that Chase Bank had purchased “certain assets and liabilities” of WAMU in the purchase transaction from the FDIC as receiver for WAMU in 2008. Chase Bank uses this affidavit ad museum to convince the court system in foreclosure cases that this affidavit somehow proves that Chase Bank purchased “every conceivable asset” of WAMU, so it must have standing in all cases involving homeowner loans originated through WAMU, or to put it simply that this proves Chase became a holder with rights to enforce or a holder in due course of the loan as defined by the Uniform Commercial Code. Antithetically, when it wants to sue the FDIC for a billion dollars… due to mounting expenses from the WAMU purchase transaction, it complains that the purchase agreement it signed didn’t really entail the purchase of “every asset and liability” of WAMU… Chase Bank claims this when it is to their advantage in a lawsuit to do so.

Mains worked as team leader in the DRR Dallas field office

[The] violation of REMIC trust rules occurred because the entities involved, for reasons of control, speed of transaction, and to hide what they were actually doing with the investors money

Unfortunately for the investors, many of the banks involved in the securitization process (like Wahoo) failed to perform the securitizations properly, hence as mentioned above, the securitizations were botched and ineffective as to passing ownership of the notes or underlying collateral. The loans purchased were not purchased THROUGH the REMIC. … The REMIC trust entity must be the one actually purchasing the mortgages directly.

This violation of REMIC trust rules occurred because the entities involved, for reasons of control, speed of transaction, and to hide what they were actually doing with the investors funds once received, held the investor funds in the “lender” banks owned subsidiary accounts, instead of funding the REMIC trusts with the money so that the trust could then purchase the loan from the “lender”, making it an actual buy and sell transaction.”

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