MORTGAGE FRAUD HAS OBAMA'S BLESSING!

Submitted by: Donald Hank

When I first heard about robo signing and how banks fudged around with mortgage securitization, I must confess, I had a hard time conceiving of this as a crime.

But this author makes it simple:

 

Asking who gets ripped off:

The homeowner.  He has no idea who is the correct [mortgage] holder.  He is paying a note but who’s getting the money?  The correct noteholder or a pretender?  There’s no way for him to know.  And if he stops paying and the putative noteholder forecloses, it may not be the actual noteholder, in which case the debt is not extinguished at all!

Yep, it's a crime, it is happening out in the open, no one is paying for the crime except the innocent mortgagees, and even libertarians like ex governor Gary Johnson are sanguine about it.

You may be impressed by the libertarian candidates and their fulminating about the Fed, but what are they saying about the other bankers and the mortgage industry? Some are giving them a pass.

It takes a broad perspective to understand the issues that profoundly affect each and every one of our lives. NONE of our candidates have it.

Don Hank

A Thursday Night Present… (More Bankster Frauds)

I’ve repeatedly pointed out that it appears that loans were pledged multiple times in various securitizations, which incidentally is black-letter fraud on two counts.  Well, now we have a nice attorney in Hawaii who has run some of these down. It’s no wonder that the Wall Street MBS scheme collapsed. Last night, together with Lisa Epstein, we ran a random audit on WaMu Mortgage Pass-Through Certificates, Mortgage Loan Trusts. One loan was found in 6 different trusts, another loan was found in FIVE trusts’ original SEC loan level data, 39 were listed in 3 trusts, and 503 were listed in two separate trusts. The winner so far is a NEW YORK condo, loan number WaMu loan # 714934858, appeared in 6 DIFFERENT trusts from May through November 2006… Ah, I see. Let’s count who gets screwed by this. The MBS buyer.  He bought…. nothing.  You see, there’s no interest there if the same loan is in more than one security.  Only one of those is valid; the other five are, from a legal perspective, counterfeit since the homeowner only promised to pay once.  If I run off duplicates of a $100 bill we call that counterfeiting, right?  Well? The homeowner.  He has no idea who is the correct holder.  He is paying a note but who’s getting the money?  The correct noteholder or a pretender?  There’s no way for him to know.  And if he stops paying and the putative noteholder forecloses, it may not be the actual noteholder, in which case the debt is not extinguished at all! Isn’t this nice? But remember,nobody committed any crimes according to Barack Obama and, I note carefully, Gary Johnson. If you or I were to make up our own stock certificates or bonds, say much less our own $100 bills, we’d go straight to prison — and we should.  But when a bank does it as appears to be the case here, and not just one either — more than 500 times — they keep the loot! Worse, listen to this allegation: 3. At first, it appeared that that was just sloppiness, but subsequently in our cases we have discovered that it appears to have been common practice intentionally not to deposit the notes (or the mortgages) in the securitized trusts, but to withhold them and unlawfully use them on the side as collateral to support loans or credit from Federal Home Loan Bank Boards, a practice that apparently mushroomed as lenders found themselves in financial trouble and in need of capital. Remember the FHLB problems from the crisis time?  Countrywide was in hock up to their neck in the months before they blew, and they were also known as one of the worst offenders for notes that magically diappeared and were never actually transferred.  Coincidence or crime?  It’d be real nice if someone in law enforcement would look into this, eh? Oh and before you dismiss this story, a drum I’ve been beating on now since 2007, you might note that the author of the cited articleis an attorney in Hawaii. So much for this being nothing more than a bunch of bloggers (who happened to get it right and in fact were spot-on), eh?

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