All Foreclosures Should Stop Immediately- Judge Rules IN 2011!

In February 2011 United States Bankruptcy Judge Robert Grossman ruled that MERS’s business practices are unlawful. He explicitly acknowledged that this ruling set a precedent that had far-reaching implications for half of the mortgages in this country. MERS is dead. The banks are in big trouble. And all foreclosures should be stopped immediately while the legislative branch comes up with a solution.

MERS — the industry’s creation — stepped up to the plate to facilitate the fraud. The judge had ruled that its practices are illegal. Here’s MERS’s business model in brief. Real estate property sales and mortgages are supposed to be recorded in local recording offices, with fees paid. With the rise of securitization, each mortgage might be sold a dozen times before it came to rest as the collateral behind a mortgage backed security (MBS), and each of those sales would need to be recorded. MERS was created to bypass public recording; it would be listed in the county records as the “mortgagee of record” and the “nominee” of the holder of mortgage. Members of MERS could then transfer the mortgage from one to another without all the trouble of changing the local records, simply by (voluntarily) recording transactions on MERS’s registry. MERS and the banks lose; investors and homeowners win right?

Well this report which was reported by L. Randall Wray here is probably the most suppressed story in the history of journalism.  http://www.huffingtonpost.com/l-randall-wray/new-yorks-us-bankruptcy-c_b_824167.html.

So what happened in 2012? RealtyTrac said 1.8 million U.S. properties received default notices, scheduled auctions and bank repossessions in 2012, down 3 percent from 2011, and down 36 percent from the peak of 2.9 million properties with foreclosure filings in 2010.

Researchers found one in every 72, had at least one foreclosure filing during the year 2012, down 1.45 percent in 2011 and off 2.23 percent in 2010. Foreclosure activity increased in 25 states in 2012, while 25 states saw a decrease in foreclosure activity. But the backlog of foreclosures in some states due to court rulings that slowed lenders from seizing properties could lead to a jump in seized homes this year, RealtyTrac said.

“That could mean that although we are comfortably past the peak of the foreclosure problem nationally, 2013 is likely to be book-ended by two discrete jumps in foreclosure activity,” said Daren Blomquist, vice president at RealtyTrac, in a statement. “We expect to see continued increases in judicial foreclosure states near the beginning of the year as lenders finish catching up with the backlogs in those states, and another set of increases in some non-judicial states near the end of the year as lenders adjust to the new laws and process some deferred foreclosures in those states.”

Foreclosure activity in 2012 increased from 2011 in 25 states, including Massachusetts where foreclosures were up 14 percent, New Jersey (55 percent increase), Florida (53 percent increase), Connecticut (48 percent increase), Indiana (46 percent increase), Illinois 3 percent increase) and New York (31 percent increase).

Foreclosures fell in 25 states including Nevada (57 percent decrease), Utah (40 percent decrease), Oregon (40 percent decrease), Arizona (33 percent decrease), California (25 percent decrease) and Michigan (23 percent decrease).

In other words, even though MERS was determined to be an illegal casino racket, most of the courts seemed to ignore this fact or waited until the courts could find a way to circumvent Judge Grossman’s ruling.

Some things did occur in 2012 that did slow things down a bit. In early 2012 when five big banks settled with state and federal officials over widespread foreclosure abuses, flagrant violations — including the seizure of homes without due process — were supposed to end. But abuses kept coming to light. Despite happy talk about a housing rebound, nearly three million homeowners are in or near foreclosure, and many continued to be victimized by improper and possibly illegal practices.

It starts out innocently enough. The banks hire property management companies to determine whether homeowners who are behind on their mortgage payments have abandoned their homes and, if so, to secure the vacant property.  It doesn’t always go that way. An Illinois suit accuses the largest company in the industry, Safeguard, of breaking into homes despite evidence of occupancy, damaging and removing personal property, changing locks, cutting off utilities, and bullying occupants into leaving their homes when they have the legal right to stay. In several other states, private lawsuits and complaints to legal aid lawyers have alleged similar abuses.

Under the foreclosure settlement, banks are responsible for vetting, supervising and auditing contractors, a category that clearly includes property management companies. Profit and expediency, however, seem to have trumped due process yet again. Property companies and their subcontractors make more money on vacant homes than on occupied ones, because abandoned property requires more work, including changing locks, boarding up doorways and removing trash. And banks get some or all of the proceeds from the sale of vacant homes.

In the past, banks have downplayed foreclosure abuses by noting that affected homeowners were, after all, late on their payments, as if that justifies harassment and worse. The Illinois suit makes clear that eviction is permissible only after a legal process is concluded. In addition, state laws to protect homeowners are consistent with federal policies — weak as they are — to promote loan modifications. Both state and federal laws are intended to ensure fairness in the brutal foreclosure process.

The failure of federal policy to ensure adequate mortgage relief to borrowers, even as the banks were bailed out, remains an injustice and a drag on the economy. Foreclosure abuses add inexcusable insult to injury.

So if you are a homeowner and you are facing the reality of foreclosure, and as we have documented here many times. Make sure that: 1). You fully understand the law and your rights. There is free legal advice out there so get it. 2). Do not leave your home under any circumstance, even if it appears you are being forced out until all proceedings are concluded. If you are being harassed or threatened by a property management company, call the police and file a complaint. If your utilities are cut, approach the utilities and demand proof that whoever ordered the utilities cut had a right to do so. In most cases they cannot provide that proof and will restore service as long as you are not delinquent.

RealtyTrac estimates that 47% of the nation’s foreclosed homes are currently occupied. The percentage actually tops 60% in some hot housing markets, like Miami and Los Angeles.  Those still living in repossessed homes include both former owners and renters. Either way, their time in the homes is mortgage and rent free.

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Attention Foreclosure Victims – Just Deserts Being Served to MERS and the Corrupt Mortgage Lenders

It seems that justice is sometimes served slow and cold, but served none-the-less.  If you have been a victim of mortgage fraud and been foreclosed or are about to be foreclosed, this is a must read.  Two recent events that were completed on August 16th may be able to help you and your legal counsel get a leg up in your foreclosure proceedings.

Source: Ellen Brown

These two landmark developments on Aug. 16 give momentum to the growing interest of cities and counties in addressing the mortgage crisis using eminent domain and may directly help those who are now in or about to be in a foreclosure process:

  1. The Washington State Supreme Court held in Bain v. MERS, et al., that an electronic database called Mortgage Electronic Registration Systems (MERS) is not a “beneficiary” entitled to foreclose under a deed of trust; and
  2. San Bernardino County, Calif., passed a resolution to consider plans to use eminent domain to address the glut of underwater borrowers by purchasing and refinancing their loans.

MERS is the electronic smokescreen that allowed banks to build their securitization Ponzi scheme without worrying about details like ownership and chain of title. According to property law attorney Neil Garfield, properties were sold to multiple investors or conveyed to empty trusts, subprime securities were endorsed as triple A, and banks earned up to 40 times what they could earn on a paying loan, using credit default swaps in which they bet the loan would go into default. As the dust settles from collapse of the scheme, homeowners are left with underwater mortgages with no legitimate owners to negotiate with. The solution now being considered is for municipalities to simply take ownership of the mortgages through eminent domain. This would allow them to clear title and start fresh, along with some other lucrative dividends.

A major snag in these proposals has been that to make them economically feasible, the mortgages would have to be purchased at less than fair market value, in violation of eminent domain laws. But for troubled properties with MERS in the title – -which now seems to be the majority of them — this may no longer be a problem. If MERS is not a beneficiary entitled to foreclose, as held in Bain, it is not entitled to assign that right or to assign title. Title remains with the original note holder; and in the typical case, the note holder can no longer be located or established, since the property has been used as collateral for multiple investors. In these cases, counties or cities may be able to obtain the mortgages free and clear. The county or city would then be in a position to “do the fair thing,” settling with stakeholders in proportion to their legitimate claims, and refinancing or reselling the properties, with proceeds accruing to the city or county.

Bain v. MERS: No Rights Without the Original Note

Although Bain is binding precedent only in Washington State, it is well reasoned and is expected to be followed elsewhere. The question, said the panel, was “whether MERS and its associated business partners and institutions can both replace the existing recording system established by Washington statutes and still take advantage of legal procedures established in those same statutes.” The Court held that they could not have it both ways:

Simply put, if MERS does not hold the note, it is not a lawful beneficiary…

MERS suggests that, if we find a violation of the act, “MERS should be required to assign its interest in any deed of trust to the holder of the promissory note, and have that assignment recorded in the land title records, before any non-judicial foreclosure could take place.” But if MERS is not the beneficiary as contemplated by Washington law, it is unclear what rights, if any, it has to convey. Other courts have rejected similar suggestions. [Citations omitted.]

If MERS has no rights that it can assign, the parties are back to square one: The original holder of the promissory note must be found. The problem is that many of these mortgage companies are no longer in business, and even if they could be located, it is too late in most cases to assign the note to the trusts that are being tossed this hot potato.

What This Means for Eminent Domain Plans: Focus on San Bernardino

Under the plans that the San Bernardino County board of supervisors voted to explore, the county would take underwater mortgages by eminent domain and then help the borrowers into mortgages with significantly lower monthly payments.

Objections voiced at the Aug. 16 hearing included suspicions concerning the role of Mortgage Resolution Partners, the private venture capital firm bringing the proposal (would it make off with the profits and leave the county footing the bills?), and where the county would get the money for the purchases.

A way around these objections might be to eliminate the private middleman and proceed through a county land bank of the sort set up in other states. If the land bank focused on properties with MERS in the chain of title (underwater, foreclosed or abandoned), it might obtain a significant inventory of properties free and clear.

The county would simply need to give notice in the local newspaper of intent to exercise its right of eminent domain. The burden of proof would then transfer to the claimant to establish title in a court proceeding. If the court followed Bain, title typically could not be proved and would pass free and clear to the county land bank, which could sell or rent the property and work out a fair settlement with the parties.

That would resolve not only the funding question but whether using eminent domain to cure mortgage problems constitutes an unconstitutional taking of private property. In these cases, there would be no one to take from, since no one would be able to prove title. The investors would take their place in line as unsecured creditors with claims in equity for actual damages. In most cases, they would be protected by credit default swaps and could recover from those arrangements.

This could be the legal precedent that has been so eagerly sought.  I would suggest those who might be effected by these rulings read the entire Ellen Brown article and then discuss these findings with your legal representatives.  Although the Bain v. MERS ruling currently only applies in Washington State, it is none-the-less establishing a precedent in law and could be used in defensive arguments.

The important issue here is that cases brought by MERS in a number of situations, MERS cannot locate the original lender and without those records, there is no one that can bring forward foreclosure proceedings!  Hope this helps a few people.  If you know of people in this situation, you might want to pass this information along.  It could save a few family homes and lives, maybe, just maybe.

The Sad Face of Banksters’ Criminality

While we all know now just how corrupt and greedy the banksters were as they precipitated the housing crisis and we have watched as nearly 4 million families have lost their homes since 2008, and those who have been displaced seem to have remained faceless.  This is the real crime.  The housing market has never really recovered and currently is still in a slump.

Countrywide Financial was one of the sub-prime lenders at the heart of the financial crisis; its predatory lending practices resulted in disgustingly large payouts for executives while sticking low-income borrowers with explosive mortgages they hadn’t a hope of paying back. The New York Times‘ Gretchen Morgenson called Countrywide, “Exhibit A for the lax and, until recently, highly lucrative lending that has turned a once-hot business ice cold and has touched off a housing crisis of historic proportions.”

Eileen Foster was an investigator in charge of Fraud Risk Management at Countrywide when the ticking time bomb of its bad loans detonated. The practices she discovered shocked her and have also shocked those who’ve heard her story—including the producers of “60 Minutes,” who asked her on the program last December to discuss the lack of prosecutions of any of the bankers responsible for the crisis. But instead of cleaning house and admitting guilt, Bank of America—which purchased Countrywide as the financial crisis grew, in what the Wall Street Journal calls “one of the worst deals ever struck in corporate America”–drove Foster out and tried to discredit her findings.

In 2011, the Department of Labor ruled that Foster had been illegally fired. It said that her firing was retaliation for her whistle-blowing and ordered that she be reinstated and paid compensation. There have still been no prosecutions, and no officials have asked to hear Foster’s story—so she’s taking it public. Earlier this year, she was honored with a Ridenhour prize for truth-telling from the Nation Institute and the Fertel Foundation.

The saddest victims of this fraud and deception have been those who have worked their entire lives to have a home to live out their retirement.  How can our Justice Department stay silent. Eric Holder should be ashamed of himself for not acting to bring these criminals to justice!

More than 1.5 million older Americans already have lost their homes, with millions more at risk as the national housing crisis takes its toll on those who are among the worst positioned to weather the storm, a new AARP report says.  Older African-Americans and Hispanics are the hardest hit.  “The Great Recession has been brutal for many older Americans,” said Debra Whitman, AARP’s policy chief. “This shows that home ownership doesn’t guarantee financial security later in life.”

Even working two jobs hasn’t been enough to allow Jewel Lewis-Hall, 57, to make her monthly mortgage payments on time. Her husband has made little money since being laid off from his job at a farmer’s market, and Lewis-Hall said her salary as a school cook falls short of what she needs to make the payments on her home in Washington.  Lewis-Hall and her husband have been making their payments late for about a year, but panic didn’t set in until recently, when the word “foreclosure” showed up in a letter from the bank.

“You’re used to living a certain way, but one thing leads to another,” Lewis-Hall said. “It’s not like I have a new car or anything. I’m driving one from 1991.”

According to AARP:

    • About 600,000 people who are 50 years or older are in foreclosure.
    • About 625,000 in the same age group are at least three months behind on their mortgages.
    • About 3.5 million — 16 percent of older homeowners — are underwater, meaning their home values have gone down and they now owe more than their homes are worth.

AARP said that over the past five years, the proportion of loans held by older Americans that are seriously delinquent jumped by more than 450 percent.  Homeowners who are younger than 50 have a higher rate of serious delinquency than their older counterparts, but the rate is increasing at a faster pace for older Americans than for younger ones, according to AARP’s analysis of more than 17 million mortgages.

Americans who are 50 or older are hard-pressed to recover from the collapse of the housing market that started in 2006 and was compounded by the recession that started in 2007. Eight in 10 own homes, but many live on fixed incomes, have little savings or have already burned through much of their retirement savings. They also have fewer working years left to build back what they may have lost.

And those who are forced to re-enter the workforce often find they can’t command the same salary that they did in the past.

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Older minorities are facing foreclosure rates that are almost double those faced by white borrowers of the same age, mirroring a nationwide trend seen in other age groups as well. Among older African-Americans, 3.5 percent were in foreclosure at the end of 2011, and the rate was 3.9 percent for Hispanics. Just 1.9 percent of white homeowners were in foreclosure.

The issue has become so dire in Rep. Elijah Cummings’ Maryland district that he has assigned one of his 20 staffers to work full time to help struggling homeowners, and his office holds regular foreclosure prevention workshops. He said the federal government can do its part by promoting principal reduction and loan modification programs.  “These are people who in many instances have never missed a payment in 20 years,” Cummings, a Democrat, said in an interview. “You see grown men crying because of the potential loss of a home.”

Among older homeowners, those who are 75 or older are in the worst shape when it comes to foreclosures, the report showed. In 2007, one out of every 300 homeowners 75 or older was in foreclosure. Five years later, about one in 30 face that same fate.

Many of those oldest homeowners may have lost income they were counting on, such as the retirement benefits of a deceased spouse. In the meantime, their mortgage payments have stayed the same.  The situation is likely to get worse before it gets better, AARP officials predicted, because of a housing market that is recovering at a snail’s pace.  “This crisis is far from over,” Whitman said. “We need to think about more creative solutions now that we have this data.”

We need to outraged by these realities.  Enough talk!  We need to demand justice. Mr. Holder, respectfully, you have all the evidence you need, how can you not act?  If you don’t have the backbone to bring these creeps to justice, then at least just declare all the mortgages illegal and give debt forgiveness to every mortgage holder over fifty as a penalty for the fraud.  You have options, please exercise them now.

High Crimes and Misdemeanors – The Bankers are the Elite of Organized Crime

We all know in our “gut” that the banking elite have pulled off the biggest heist of wealth in the history of mankind….and they got away with it.  No significant principle of any bank has gone to jail or even been indicted for the obvious fraud, deception, and grand larceny that has been perpetrated on the citizens of the world.

However, are we going to allow them to get away with MURDER, literally?  As more and more Attorney Generals of various states have begun to open investigations in the mortgage fraud that is as obvious as an elephant in the room, more and more mid and lower level banking managers and foreclosure managers  have come forward to admit the fraudulent schemes that have been perpetrated on home owners.

In Nevada, the AG was getting very very close to the truth, particularly because of a few brave whistleblowers that were beginning to step forward.  The principle whistleblower in Nevada was a brave young lady named Tracy Lawrence.  She is now dead!

Tracy Lawrence, the notary public who blew the whistle on a massive foreclosure fraud scheme, was found dead in her Las Vegas home on Nov. 28, MSNBC reported.

Cause of death has not yet been determined, but Officer Jacinto Rivera, a Las Vegas Metropolitan Police Department spokesman, said the case was not being investigated as homicide. She was 43.

Earlier this month, Lawrence came forward and admitted to the Nevada Attorney General’s Office that she notarized 25,000 fraudulent documents for Lender Processing Services, a Florida company used by most major banks to process home repossessions. The documents were filed with the Clark County Recorder’s Office between 2005 and 2008, The Los Angeles Times reported.

Lawrence also accused two loan officers of allegedly running the massive robo-signing scheme, saying they forged signatures on tens of thousands of default notices. Nevada now alleges that Gary Trafford, 49, of Irvine, Calif., and Gerri Sheppard, 62, of Santa Ana, Calif., directed their employees to forge foreclosure documents, notarize the signatures on the documents they had forged and file the fraudulent paperwork in order to begin foreclosures on homes throughout the county.

Trafford and Sheppard have been indicted on more than 600 counts of offering false instruments for recording, false certification on certain instruments and notarization of the signature of a person not in the presence of a notary public. Authorities are currently negotiating the terms of their surrender, KSNV MyNews 3 reported.

Earlier this month, Lawrence pleaded guilty to one count of notarizing the signature of a person not in her presence, The Associated Press reported. Had Lawrence shown up at her sentencing hearing on Monday, she could have faced a potential sentence of up to one year in jail and a fine of up to $2,000.

On Nov. 17, Lender Processing Services issued a statement acknowledging that the signing procedures on some of documents were flawed. The company also agreed to fully cooperate with the attorney general’s investigation.

“I am deeply committed to ensuring that LPS meets rigorous standards of professional conduct and operating excellence,” newly appointed LPS President and CEO Hugh Harris stated. “I have full confidence in the ability of our leadership team and over 8,000 dedicated employees to deliver on that commitment.” According to RealtyTrac, Nevada has had the highest foreclosure rate in the nation for 56 straight months.

Lender Processing Services, Inc. (LPS) is a leading provider of integrated technology and services to the mortgage and real estate industries. LPS offers solutions that span the mortgage continuum, including lead generation, origination, servicing, workflow automation (LPS Desktop), portfolio retention and default, augmented by the company’s award-winning customer support and professional services. Approximately 50 percent of all U.S. mortgages by volume are serviced using LPS’ Mortgage Servicing Package (MSP).

(Reuters)  December 1st- The Massachusetts attorney general has filed a lawsuit against five large U.S. banks accusing them of deceptive foreclosure practices, a signal of ebbing confidence that a multi-state agreement can be worked out. Attorney General Martha Coakley said on Thursday she filed the lawsuit partly because it has been taking too long to hammer out a nationwide settlement.

For more than a year, state and federal officials have been negotiating a deal in which banks would pay billions of dollars in fines – to go toward housing relief – in exchange for legal protection against future suits.  The Massachusetts lawsuit, filed in state court in Boston, accuses Bank of America Corp, JPMorgan Chase & Co Inc, Citigroup Inc, Wells Fargo & Co and GMAC of deceptive foreclosure practices, such as using robo-signers and false documents. “Our suit alleges that the banks have charted a destructive path by cutting corners and rushing to foreclose on homeowners without following the rule of law,” Coakley said in a statement.

The attorney general in Iowa, Tom Miller, who is leading the negotiations for the states, said in a statement they hope to reach a settlement “soon.” He also said Coakley had indicated she is still open to joining the settlement.  “We’re optimistic that we’ll settle on terms that will be in the interests of Massachusetts,” Miller said.

However, analysts said Coakley’s lawsuit is a bad sign for banks, which hope a deal with states and federal authorities could help the industry move beyond the legal fallout that has dogged it since the peak of the financial crisis. “I can’t say anything is dead, but it sure looks like this is a negative. The banks are going to have these suits out there for years.” said Paul Miller, a bank analyst with FBR Capital Markets.

The discussions have been bogged down by states concerned the deal was either too lenient or provided the wrong kinds of relief, and by the banks who sought release from mortgage-related claims beyond the original conduct at issue.

The Massachusetts complaint accuses the banks of using fraudulent documents when processing foreclosures; of foreclosing on properties without holding the actual mortgage; and of failing to uphold promises to modify loans for the state’s homeowners. It also names the banks’ private mortgage registry, MERS, as a defendant, accusing it of dodging fees and corrupting the state’s land recording system.

On Thursday, Coakley was firm that she would not sign a mortgage settlement that included “broad liability release regarding MERS and other issues.” A person familiar with the talks said Massachusetts has sought to protect its ability to pursue certain claims against the banks for their use of MERS. Those liability issues are still being hashed out in negotiations, the person said.

The banks targeted in the suit said Coakley’s move imperils chances for broader relief. Bank of America said in a statement that a collaborative resolution, rather than continued litigation, would more quickly heal the housing market and help drive an economic recovery.

Chase said in a statement that it is disappointed Massachusetts filed a lawsuit when negotiations are ongoing on a broader settlement that it said could bring immediate relief to borrowers. GMAC said it was unhappy that Massachusetts “elected not to continue a more constructive path that could help borrowers in the state, but rather has chosen to use the court process.”

Wells Fargo disagreed with Coakley that it has not kept a promise to modify loans. Citi said it had not yet reviewed the lawsuit, but the bank believes it has operated appropriately and in compliance with existing laws.

Coakley, who took office in 2007, has been aggressive in moving against Wall Street firms and U.S. banks. Her office said it has secured more than $600 million in relief for investors and borrowers, while keeping more than 24,000 people in their homes.

I think we ought to urge the AGs to forget about “settlements and fines” and start talking about issuing criminal warrants instead.  When we read about 103 year women facing eviction from their home of 53 years and Chase refusing that same old lady from paying off the loan, and we have a death under more than suspicious circumstances, and we have an organized system of fraud under MERS and LPS which was involved in nearly 100% of these fraudulent actions, it is time a few hundred upper level managers of this organized crime operation move to our wonderful Federal penal system to live out their lives.

How much more bold are these banksters going to get?  Maybe it is time to pull the plug on the big five and show them they are not too big to fail. Run the banks, not because we are nervous about losing our money, but because they are crooks and thieves.  Even the Mob would never charge the interest rates these guys are demanding on credit cards, in addition to the fraud they are perpetrating on their mortgages.  How much more proof do we need?  We, the consumers, are the power, not the AGs, nor the Treasury Department which has been absolutely mute on the subject, even though these actions are in violation of Interstate Commerce Laws.  The Occupy Movements are all good, but they must be supported by our actions.  It is both easy and simple for each one of us to close our accounts at the Big Five banks and open them in our locally owned credit unions. It would also convince us we are still in charge.  Just a thought.

Finally, Maybe Some Justice.

As we wrote in this blog over a year ago, it is certainly odd that not one banker, hedge fund manager (real hedge fund managers, not dear Bernie’s ponzi scheme), or one regulator, or member or employee of the Fed has been indicted for criminal behavior or been sued for neglect, unless you count the $550 million settlement by Goldman Sachs to avoid a criminal investigation.  At least we know the going price for “sticky” legal problems of that magnitude to get “resolved”.

I suggested then that the entire blue pinstriped suit bankster crowd all get projected against the RICO Act because I suspect they would test “positive.  What do you think?  Well, we might just get a chance to see that happen.  All I can say is finally someone with some guts. I am speaking of Patrick Byrne, CEO of Overstock.com.

Speaking on the Salt TV Network recently, President and CEO of Overstock.com (NASDAQ: OSTK) Patrick Byrne referred to his company as “bold” and revealed that, in November 2010, after four years of fighting, a judge forced Goldman Sachs (NYSE: GS) to turn over some documents that prompted Overstock to re-file its suit against Goldman as a RICO [Racketeer Influenced and Corrupt Organizations] action. The case went before a hearing and it has been approved.

“The laws that got written in the ’80s to allow the feds to go after organized crime – the lawyers can now look at what they did,” said Byrne. “There is nothing about RICO that says you have got to use a gun. This was a highly organized crime.”

Byrne went on to say that he feels Americans are living in an oligarchy. “There are two power centers in this country – Wall Street and Washington D.C., and Wall Street has really got Washington D.C. under its thumb,” said Byrne. “Five years ago, people thought I was a lunatic to say that, and now it is trivially obvious. That means that you can’t count on Washington. You cannot count on the regulators, you cannot count on the Senate Banking Committee, and you cannot count on the New York-based financial press. The only thing that is going to fix this is to get them in front of 12 Americans in a jury room. That is the only thing they cannot buy in America.”

The case will be heard before a jury on December 5, 2011. “It is going to be the OJ Simpson trial of the financial world,” said Byrne. “It will be heard in California, in San Francisco. It will be exciting. I have said publically that I will not settle. It would be treason for me to settle. It would be like asking a Jewish person, how much would you settle with Hitler for? There is really no number. It is not that complicated a case. I am hearing that it is only going to take a few weeks. It is very simple. There are emails and a bunch of data – it is just about presenting it all to a jury.”

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/g/a/2011/03/16/benzinga930498.DTL#ixzz1H7hfkBzh

Goldman Sachs’s opportunistic moves do not always pan out. Take Litton Loan Servicing which Goldman bought in 2007 when it was trying to obtain as many sub-prime mortgages as it could in order to concoct those CDOs that it foisted on unsuspecting buyers before the financial meltdown in 2008. Goldman Sachs is now considering selling this company.

I do not wonder why they are selling it: Litton serviced $9.7 billion in mortgages and had a delinquency rate of 43% in 2009. Goldman Sachs halted 23,000 foreclosures in order “to sort out affidavits that were signed without a review of the documentation.”

Goldman Sachs’s actions surrounding Litton lie at the heart of the fraud that Goldman Sachs perpetrated, not only on the homeowners of the US but also on the pensions and savings funds that bought the highly rated CDOs that Goldman Sachs touted.

Goldman Sachs had to buy a less-than-sterling company in the hopes of keeping its CDOs rolling along and raking in the money but Litton proved to be a horror show for hundreds of the homeowners who were caught in its snare. Customers who were unfortunate enough to buy their mortgages through Litton have a great deal to complain about. See the hundreds of complaints against Litton listed here.

So there are both ends of the string, now it is up to the courts to unravel the knots to determine if indeed Goldman Sachs conspired to defraud investors.  [you are supposed to looked shocked here] This show will start in San Francisco on December 5th.  I’ll bring the popcorn, you can get the sodas, cause this is going to be a really good show!  I have visions of little rats jumping ship!

Further Updates from the Currency War Front

Well, folks, it’s official – mark November 22, 2010 in your calendars.  With yesterday’s $8.3 billion POMO monetization, the Fed’s official holdings of US Treasury securities now amount to $891.3 billion, which is higher than the second largest holder of US debt: China, which as of September 30 held $884 billion, and Japan, with $864 billion.  The Fed is now buying about $30 billion per week, or about $120 billion per month, for the foreseeable future and beyond, it would mean that China would need to buy a comparable amount to be in the standing. It won’t. In other words, the Ponzi operation is now complete, and the Fed’s monetization of US debt has made it not only the largest holder of such debt, but made external funding checks and balances in the guise of indirect auction bidding, irrelevant. China is now not the one having the most to lose on a DV01 basis on that day when the inevitable surge in interest rates finally happens. That honor is now strictly reserved for America’s taxpayers.

In addition, Tuesday China and Russia sent a loud message to the FED.

Source: Asia One – Su Qiang and Li Xiaokun

St. Petersburg, Russia – China and Russia have decided to renounce the US dollar and resort to using their own currencies for bilateral trade, Premier Wen Jiabao and his Russian counterpart Vladimir Putin announced late on Tuesday.  Chinese experts said the move reflected closer relations between Beijing and Moscow and is not aimed at challenging the dollar, but to protect their domestic economies.

“About trade settlement, we have decided to use our own currencies,” Putin said at a joint news conference with Wen in St. Petersburg.

The two countries were accustomed to using other currencies, especially the dollar, for bilateral trade. Since the financial crisis, however, high-ranking officials on both sides began to explore other possibilities. The yuan has now started trading against the Russian rouble in the Chinese interbank market, while the renminbi will soon be allowed to trade against the rouble in Russia, Putin said.

“That has forged an important step in bilateral trade and it is a result of the consolidated financial systems of world countries,” he said.

Putin made his remarks after a meeting with Wen. They also officiated at a signing ceremony for 12 documents, including energy cooperation.  The documents covered cooperation on aviation, railroad construction, customs, protecting intellectual property, culture and a joint communique. Details of the documents have yet to be released.

Wen said Beijing is willing to boost cooperation with Moscow in Northeast Asia, Central Asia and the Asia-Pacific region, as well as in major international organizations and on mechanisms in pursuit of a “fair and reasonable new order” in international politics and the economy.

Sun Zhuangzhi, a senior researcher in Central Asian studies at the Chinese Academy of Social Sciences, said the new mode of trade settlement between China and Russia follows a global trend after the financial crisis exposed the faults of a dollar-dominated world financial system.

Pang Zhongying, who specializes in international politics at Renmin University of China, said the proposal is not challenging the dollar, but aimed at avoiding the risks the dollar represents.  Wen arrived in the northern Russian city on Monday evening for a regular meeting between Chinese and Russian heads of government.

In related news on the situation in the EU comes the grim but expected news that the Spanish 3-month bill auction failed.  The debt agency sold only €3.26bn of the €4-5bn that was offered, at average yield of 1.743% vs 0.951% prior. What people must understand is that is nearly double the interest rate.  This debt service is the back breaker to the economy.  Tensions are surely going to start boiling over on the Emerald Isle.  If Greece was a big bomb to the EU and ECB stability, and Ireland was Greece’s big brother, then the Spanish economy is their bigger brother Bubba.  These three countries WILL require further bailouts and quite frankly more than the ECB can handle.  The death of the EU is like watching a shot buffalo go down in a Sam Peckinpah movie.

Finally, back in the US, in addition to the impacts of QE2, the mortgage situation as related to the big banks is far from going away.  To put things in clear perspective, the banks bundled, and sold to investors, junk paper consisting of bundled questionable mortgages.  In most cases, those same banks kept the seconds on those mortgages.  However, now the investors do have recourse.  These bundled packages required the banks to “buy back” any equity that was in default or foreclosure.  The bottom line to this is that the top five banks, between the bad second mortgages and the default clauses on the crap they dumped on investors, are on the hook for nearly $400 Billion, which is more than the equity value of those top five banks.

In view of the fact the currency wars have unquestionably erupted, these elements represent the perfect storm.  As a side, the “fear” index on Wall Street today was the highest recorded since 1987.  These events are moving along the worst case scenario lines.  Watch very carefully.

If You Are In Foreclosure, This is a Must Read

After a record 347,420 foreclosure filings and 102,134 bank repossessions in September alone, the U.S. is on pace to top 1.2 million foreclosures this year, up from about 1 million last year, according to new data from RealtyTrac, which collects and analyzes real estate records from across the country.

If you are one of those caught up in this mess, there are a number of things you need to know.  First, do not ignore any notices or requests to appear in court.  Have all of your paper work in order.  However, the most important thing is to make the lender PRODUCE their documentation which establishes their right to proceed with foreclosure.  In almost 75% of these cases THEY DO NOT HAVE IT.  As I wrote in my most recent article, this is a mess.

In a lot of cases, those facing these proceedings are financially strapped and think that they do not have the money to hire an attorney and so tragically they do nothing and are evicted.  What is doubly sad about this is that in most cases they have standing in the courts and could save their homes.  If you are in this situation, there is help out there and you cannot afford not to take advantage of that help.  Read below and may it help just one family.

Source: Herald Online

PALM BEACH, Fla. —

More than a year before lenders, law firms and document companies began owning up to widespread paperwork problems with their foreclosure filings, Lisa Epstein and Michael Redman already knew that something was wrong – very wrong.

Redman, a former online automobile consultant, got his first taste of the problem in early 2008, when he tried to help a relative who was facing foreclosure.

As he tried to determine which of three or four supposed lenders held the note, Redman, 35, realized that not only did he not know the answer, neither did any of the companies that were asking for payment.

Epstein, a nurse who cares for cancer patients, also is going through foreclosure. She got her baptism in the world of shoddy foreclosure paperwork in the summer of 2009, however, when she tried to help a brain tumor patient keep her home.

Epstein helped draft a letter challenging the foreclosure because, as in Redman’s case, it was unclear from court papers who owned the home’s mortgage.

After arriving at the summary judgment hearing in her nurse’s uniform, an emotional Epstein, 45, watched as the ill woman read their letter aloud in court. When the opposing attorneys never showed, the judge refused to finalize the foreclosure. The woman remains in her home as the legal wrangling continues.

For Epstein, who often helped her patients navigate disputes with their health insurance companies, the role of advocate wasn’t new – but the thrill of a courtroom victory was.

“It was like something struck inside me, like this is what I’m compelled to do. I can be a nurse for people caught in this foreclosure crisis,” Epstein said. “I remember thinking, ‘I’m not an attorney, and there are definite obstacles, but maybe there’s a role for me.’ And I ran back to the hospital like I had wings. I felt like this is my purpose.”

Within a year, she and Redman – who didn’t know each other at the time – would leave their respective jobs to pursue their passion for helping others and exposing injustice in the foreclosure industry.

After meeting late last year at a foreclosure fraud seminar, they teamed up to become two of the nation’s most influential civilian beat cops for the beleaguered foreclosure industry.

Equal parts agitators, activists and advocates, Redman and Epstein have made their presence felt in Florida and nationally through their respective websites, 4closureFraud.org and foreclosurehamlet.org.

Under a sun-drenched sky recently, Redman proudly perused his Web log to see recent visits from the Internal Revenue Service, the Homeland Security Department, the Justice Department, Fannie Mae, the Housing and Urban Development Department and the CIA, among others. Someone from the executive office of the president took a recent look, too, he said.

Major banks also are peeping at Redman’s frequent postings and snarky analysis of embarrassing documents that appear to show foreclosure industry fraud.

Two weeks ago, he posted a deposition from a clerk at one of four Florida law firms that the state attorney general is investigating on suspicions that they’re using fabricated documents to evict thousands of homeowners. She told investigators that the firm’s employees regularly signed affidavits without reading them and put incorrect dates on documents.

“This kind of stuff goes on all the time, and it’s everywhere,” Redman said.

Problem foreclosure documents are the latest chapter in the housing crisis that triggered the Great Recession.

In foreclosure cases nationwide, bank officials have signed sworn affidavits, supposedly verifying their knowledge of the matters in question. However, after several bank officials told investigators they’d signed thousands of affidavits without reading them, the nation’s foreclosure process has ground nearly to a halt as officials investigate the practice known as “robo-signing.”

Major lenders JPMorgan Chase and Ally, formerly GMAC, have stopped evictions to check for bad paperwork in Florida and 22 other states that require court orders to seize property. Bank of America earlier this month halted foreclosures while it reviews paperwork in all 50 states.

On Wednesday, Iowa Attorney General Tom Miller said he’d lead the new Mortgage Foreclosure Multistate Group’s investigation of the problem and propose possible remedies. The bipartisan group includes state attorneys and state banking and mortgage regulators from all 50 states.

In Florida, where one of every 56 homes was in foreclosure proceedings in the third quarter of this year, Redman and Epstein have shined a light on efforts to ram cases through courts without much fact-checking.

Foreclosure defense attorney Chris Immel of Palm Beach County said the ongoing scandal was changing that practice nationally and in Florida.

“A lot of that has to do with the activism of people like Mike and Lisa. They get a lot of attention, and a lot of people look to them because they’re very active with their blogs and their activism,” Immel said.

Whether they’re being courted by prominent print news outlets or interviewed on cable television news shows, doing conference calls with state officials or protesting on courthouse steps, Redman and Epstein are consumed by their new roles.

They’ve filed briefs with the Florida Supreme Court and sent questionable documents to state investigators, the FBI, the Justice Department and numerous banking regulators.

Earlier this year, they led two busloads of people to the state capital in Tallahassee to protest a proposed change in Florida law that would have allowed foreclosures without court orders. The measure was defeated.

When it appeared several weeks ago that President Barack Obama might sign legislation that could weaken fraud protections in foreclosure cases, Redman and Epstein posted an action alert, urging people to call the White House and voice their opposition.

“At one point, so many people were calling (the comment line) that you couldn’t even get through. I absolutely think our silent army is not being silent anymore,” said Karen Pooley of Seattle, a 48-year-old building material saleswoman who credits Epstein’s website with teaching her how to find evidence of fabricated paperwork. She ended up finding suspicious documents that helped a friend get his foreclosure sale canceled.

“Not postponed, but canceled,” said Pooley, who’s also fighting her own foreclosure and organizing local volunteers to look for more bad documents. “Lisa was very helpful in teaching me how to search and get this army started.”

Andrew Delaney, who’s fighting the foreclosure of his home in Ashburnham, Mass., drove all the way to Florida in the spring to meet with Redman. He said Redman’s advice on checking court documents for flawed paperwork has allowed him to avoid foreclosure for more than two years as banks try to prove who holds his note.

So don’t give up and ask for help. Also, if you know anyone facing this situation, please pass this article to them.