Foreclosure Gate Update...

Banks Attempt to Bully NY

 

You knew this was coming...

Feb. 6 (Bloomberg) -- Bank of America Corp., JPMorgan Chase & Co. and Wells Fargo & Co. made a last minute demand that New York drop claims filed against them Feb. 3 as a condition of a $25 billion nationwide settlement over foreclosure abuses, a person familiar with the matter said.

The deadline for states to sign the proposed deal is today. The push by the three banks raised a new obstacle in getting New York Attorney General Eric Schneiderman’s support for the deal, said the person. Schneiderman, along with the attorneys general of California, Nevada and Delaware, has voiced concerns about the terms of the accord.

Now we'll see what sort of balls Schneiderman has.

This is what should happen -- Schneiderman should tell them to go to hell.  If the other states want to settle, that's fine, but for the banksters to play this sort of hostage game -- well, it simply can't be allowed to stand.

One would hope that Nevada's AG, which recently passed a law that requires foreclosing parties to certify under penalty of felony indictment that they have the proper paperwork and chain of title before foreclosing, would also erect the middle finger.

Interestingly enough since that law went into effect rendering any false or robosigned filing a criminal felony (and $5,000 fine for each document) offense new foreclosure filings have effectively ceased by these very same banks. Never mind the 606 count indictment that came out of the Nevada AG's office shortly thereafter.

Is that an admission that the banks don't have proper title to the notes and can't document proper procedure?  Good question.

But this much is certain -- Schneiderman, California AG Kamala Harris and Deleware's Beau Biden, along with Nevada and New York all ought to tell these banks to stick it.

Why?

That's simple -- those who were illegally foreclosed won't get much if anything at all out of this deal, and the so-called "principal forgiveness" isn't worth the paper it's written on.  Those deals will be preferentially handed out to protect the banks' second lines, doing little or nothing for the vast majority of the borrowers. 

Worse, none of the proposed settlement will do a damn thing to address the harm that has been done or extract punishment.  And it is punishment that is needed -- punishment so severe that nobody will ever think of doing it again.  We already have a so-called "settlement" with regard to wrongful foreclosures and similar with regard to Countrywide, and while it was supposed to grant billions in relief to homeowners it has both brought almost no actual help and not been enforced.

http://market-ticker.org/akcs-www?post=201604

and.....

“Linda Greene” has become a household word to those on the foreclosure fraud beat. And it turns out, for once, that the work of diligent investigators such as the foreclosure attorneys around Max Gardner, and investigators like Lynn Szymoniak and Lisa Epstein led to press coverage which in turn spurred prosecutors to act.

What is striking about the indictment by a Missouri grand jury is that the Missouri AG Chris Koster has decided to challenge the banks’ party line that robosigning and related abuses were mere “paperwork problems.” He’s called robosiging what it is: forgery. The 136 count indictment is for forgeries and false declarations, and the targets are LPS subsidiary and its founder and past president, Lorraine Brown. From a press release by Koster:

Today’s indictment reflects our firm conviction that when you sign your name to a legal document, it matters,” Koster said. “Mass-producing fraudulent signatures on millions of real estate documents across America constitutes forgery. When you file those documents in our state, you are committing a crime under Missouri law.

The forgery and false declaration counts each allege that the person whose name appears on 68 notarized deeds of release on behalf of the lender is not the person who actually signed the paperwork. The documents were then submitted to the Boone County Recorder of Deeds as though they were genuine…

DOCX’s role in the robo-signing process came to national attention when 60 Minutes reported that Linda Green, an employee of DOCX, purportedly signed thousands of mortgage-related documents on behalf of several different banks and in multiple handwritings. The 68 documents on which the indictments are based were purportedly signed by Linda Green, but were in fact allegedly signed by someone else.

Forgery is a Class C felony and False Declaration is a Class B misdemeanor. If convicted on the most serious count, Brown could face up to seven years in prison for each count. DOCX could be fined up to $10,000 for each forgery conviction and $2,000 for each false declaration conviction.

The open question is whether Koster intends to stop here or is using the mob prosecution strategy that Catherine Cortez Masto seems to be employing, that of going after LPS, which was the major outsourcing platform for servicers, and seeing where that trail leads.

Additional comments from Gretchen Morgenson of the New York Times:

One of the largest companies that provided home foreclosure services to lenders across the nation, DocX, has been indicted on forgery charges by a Missouri grand jury — one of the few criminal actions to follow reports of widespread improprieties against homeowners…

A grand jury in Boone County, Mo., handed up an indictment Friday accusing DocX of 136 counts of forgery in the preparation of documents used to evict financially strained borrowers from their homes. Lorraine O. Brown, the company’s founder and former president, was indicted on the same charges.

Employees of DocX, a unit of Lender Processing Services of Jacksonville, Fla., executed and notarized millions of mortgage documents for big banks and loan servicers over the years. Lender Processing closed the company in April 2010, after evidence emerged of apparent forgeries in these documents, a practice now called robo-signing.

DocX was a particularly bad actor; we’ve discussed in earlier posts how it had a price sheet for various services, including fabricating documents like mortgage note out of whole cloth. I’m surprised it has taken this long for someone to go after them. While this is clearly good news for borrowers and bad news for LPS, I doubt that anyone at the banks will feel threatened by this action. Unless this action leads to further prosecutions, it only scrapes the surface of bad conduct in the mortgage arena.

http://www.nakedcapitalism.com/2012/02/mirabile-dictu-missouri-attorney-general-files-criminal-lawsuit-on-robosiging.html