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When Banks Are the Robbers

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Posted on Oct 19, 2010

By Amy Goodman

The big banks that caused the collapse of the global finance market, and received tens of billions of dollars in taxpayer-funded bailouts, have likely been engaging in wholesale fraud against homeowners and the courts. But in a promising development this week, attorneys general from all 50 states announced a bipartisan joint investigation into foreclosure fraud.

Bank of America, JPMorgan Chase, GMAC and other big mortgage lenders recently suspended most foreclosure proceedings, following revelations that thousands of their foreclosures were being conducted like “foreclosure mills,” with tens of thousands of legal documents signed by low-level staffers with little or no knowledge of what they were signing.

Then the Obama administration signaled that it was not supporting a foreclosure moratorium. Not long after, Bank of America announced it was restarting its foreclosure operations. GMAC followed suit, and others will likely join in. So much for the voluntary moratorium.

GMAC Mortgage engaged in mass document processing, dubbed “robo-signing.” In several cases, GMAC Mortgage filed documents with courts that were signed by Jeffrey Stephan. Stephan presided over a staff of 12 in suburban Philadelphia. Ohio Attorney General Richard Cordray filed a lawsuit against GMAC Mortgage, Stephan and the bank that owns GMAC, Ally Financial (itself a subsidiary of General Motors).

According to one report, Stephan received 10,000 mortgage foreclosure documents to process in one month. Based on an eight-hour workday, he would have had to read, verify and sign, in the presence of a notary, about one document per minute. He admitted to signing documents without reading them or checking the facts about homeowners said to be in default. And Stephan was just one of many “robo-signers.”

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Recall that GM received $51 billion in taxpayer bailouts; its subsidiary, GMAC, received $16.3 billion; and Ally Financial subsidiary GMAC Mortgage received $1.5 billion as an “incentive payment for home loan modification.”

So you as a taxpayer may have bailed out a bank that is fraudulently foreclosing on you. What recourse do you have?

Back in February 2009, Ohio Rep. Marcy Kaptur advised homeowners to force lenders to “produce the note.” People facing foreclosure were being taken to court while the bank alleging default couldn’t even prove it owned the mortgage. The mortgage document often had been lost in the tangled web of financial wheeling and dealing. Kaptur told me: “Millions and millions of families are getting foreclosure notices. They don’t have proper legal representation ... possession is nine-tenths of the law; therefore, stay in your property.”

If you stay in your home, your mortgage lender may break in. Nancy Jacobini of Orange County, Fla., was inside her home when she heard an intruder. Thinking she was being burglarized, she called 911. Police determined the intruder was actually someone sent by JPMorgan Chase to change the locks. And Jacobini wasn’t even in foreclosure!

Most banks that suspended foreclosure efforts only did so in 23 states—because it is only in those 23 states that courts actually adjudicate over foreclosure proceedings. One judge who oversees foreclosures is New York State Supreme Court Justice Arthur Schack. He has made national headlines for rejecting dozens of foreclosure filings. He told “Democracy Now!” news hour, “My job is to do justice ... we run into numerous problems with assignments of mortgages, questionable affidavits of merit and just sloppy paperwork in general.”

Bruce Marks runs NACA, a national nonprofit that helps people avoid foreclosure. He told me: “When President Obama was running for president, he said one of the first things he’ll do is put a moratorium on foreclosures. He never did. He never backed bankruptcy reform so people could have the right to go in front of a bankruptcy judge.”

He went on: “And where is President Obama? When he says, ‘Well, you know, we don’t want to upset the market,’ what is good about a market when someone is foreclosed on and ... you’ve got a vacant building? We have to have a national moratorium to give ourselves a window of opportunity to restructure mortgages ... to look at homeowners as people, not as a commodity to make money.”

According to RealtyTrac, banks repossessed 102,134 properties in September, a home roughly every 30 seconds. Every 30 seconds, banks—many that received funds from the Bush administration’s TARP, and that may be using fraudulent practices—foreclose on an American family’s dream of home ownership. Meanwhile, GMAC Mortgage has reported increased profits for the first half of 2010.

Denis Moynihan contributed research to this column.

Amy Goodman is the host of “Democracy Now!,” a daily international TV/radio news hour airing on more than 800 stations in North America. She is the author of “Breaking the Sound Barrier,” recently released in paperback and now a New York Times best-seller.

© 2010 Amy Goodman

Distributed by King Features Syndicate


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By Che J, November 15, 2010 at 3:31 pm Link to this comment

This is bogus news to mislead the public.  Banks are going to have to do the
foreclosures they’ve been putting off.  They’ve been putting off foreclosures to
keep the loan rates down - for themselves, so they can borrow at one percent. 
The housing prices are too high for ordinary people to take advantage of the rates
- these are investor rates.  As soon as foreclosures are released on the market, real
estate prices will go down and rates will go up.  As I said, this news was released
as part of a campaign on the part of banks to stall, and the more Democracy Now
makes of it, the more banks feel they have achieved the goal of fooling the public.

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By Modesto Glykis, November 10, 2010 at 2:40 am Link to this comment
(Unregistered commenter)

The Big Banks Are The Robbers And The Big Banks Are The Traitors Of The Ordinary Investors And Life Goes On.
It was just the right time when President George W. Bush was going out and President Barack Obama was coming in to pull the trigger for the big Bang.
Most of the money the big banks used to loan out to the unsecured home-buyers in the United States, were Globally savings of ordinary citizens which they had their life savings in Stocks and other investments and which were directly or indirectly linked to the big banks of the United States.

All these money where lost and stayed in the suffering American economy giving in short time, economical relive to the American government and in the long ran is a killing of the chicken to get the egg….

People who lost their savings are the victims as usual, more or less they realized where is the problem and in five to ten years from now they will forget and start investing in the same manner until the next time.

Modesto Glykis
Montreal-Laval,Quebec

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By Inherit The Wind, October 23, 2010 at 6:53 pm Link to this comment

FF, yup. You nailed that one.  We ARE in agreement—it all synchs.

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By Fat Freddy, October 23, 2010 at 10:38 am Link to this comment

Inherit The Wind

I said, at the time, you can’t have a tax cut and wage two wars at the same time. It’s like “double stimulation”. Then add the low interest rates, and you’re sure to shoot your load before your pants hit the floor. There was simply too much money in the economy. The Austrians say, too much cheap, easy money will always find “malinvestments”. A neo-Keynesian by the name of Hyman Minsky said the same thing. If there wasn’t a bubble in housing, there would have been one somewhere else. If you remember, the price of oil was high just on speculation. There was actually a mini-oil bubble.

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By Inherit The Wind, October 23, 2010 at 12:15 am Link to this comment

FF:

The Bush cuts almost IMMEDIATELY created a budget deficit that required borrowing. That’s simply impossible to impeach.

The problem was that the tax cuts did NOT go into circulation.  Jobs growth was awful throughout the Bush years—and the best quarter of jobs growth under Bush was worse than the worst quarter of jobs growth under Clinton. Why?

Yeah, once Greenspan knew what he was doing.  The “God” complex happened in the late ‘90’s during the dot-com “New Economy” period where AG got it into his head he had to show the Market who was boss—the Fed.  Money tightened and the bubble burst, kicking off the minor recession Bush rode into the WH.  Once there, with the tax cuts (which AG endorsed and later said “Ooops..we made a mistake) he loosened the money supply up again and we were off to the races that began its collapse in 2006….the better pundits warned it was just the beginning and OH! they were right.

FF:  Realize you and I are not far apart here…just a matter of clarifying emphasis and who really WAS in the driver’s seat—and who was riding on the bus.

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By Fat Freddy, October 22, 2010 at 9:15 pm Link to this comment

Inherit The Wind,

But you must remember that the Fed, under Alan Greenspan, was, by lowering the rates, hiding and off-setting the extreme upward pressure on the interest rate caused by…the 2001 tax cuts.

I’m not sure I agree with that statement. The Bush tax cuts allowed more money to remain in circulation, thus creating more bank deposits, which were multiplied through fractional reserve lending, usually about 9:1, depending on the FRB’s reserve requirements. Which means for every dollar deposited, 9 were created (out of thin air). An increase in the money supply puts a downward pressure on interest rates.

So, really, the fault lies clearly and totally with the Republican administration of Bush and the incompetent leadership at the Fed of Greenspan.

Of course. Any Libertarian, or Austrian economist puts the blame directly on Greenspan. But don’t forget, Greenspan was there during the entire Clinton presidency, and “forced” Bush 41 to raise taxes, or he would raise interest rates. Believe it or not, Greenspan was a very good economist back in the 70s (for a monetarist), but he developed a God-complex.

As for Obama and Bernanke, what are they doing differently than Bush and Greenspan? It’s more of the same, only in overdrive. Don’t forget, during the entire mortgage build-up, Timmaaaay Geithner was President of the Federal Reserve Bank of NY, and Jamie Dimon, Obama’s buddy, was and is on the board of Directors of the Fed NY, and, of course CEO of JP Morgan Chase.

My problem is, the FRB has far too much power and control over the economy. In my opinion, more that can be handled. The FRB was set-up, originally, to be “the lender of last resort”, not to manipulate the economy. However, just being a lender of last resort, implies manipulation of the economy, because it protects banks from their own insolvent, and some would argue, fraudulent practice of fractional reserve lending. In effect, the FRB was the originator of “TARP”, in 1913. If the FRB did not exist, and banks were “forced” to be held accountable, it would eliminate the need for many of the regulations currently on the books. That’s why Austrians say our current system is the equivalent of “feeding a lion with one hand, and whipping him with the other”. It makes for a very schizophrenic lion…and handler.

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By REDHORSE, October 22, 2010 at 7:09 pm Link to this comment

Thanks for the rational insight Gentlemen!!

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By Inherit The Wind, October 21, 2010 at 8:13 pm Link to this comment

FF:

For once we are close to being in sync.  But you must remember that the Fed, under Alan Greenspan, was, by lowering the rates, hiding and off-setting the extreme upward pressure on the interest rate caused by…the 2001 tax cuts.

These force the Federal gov’t which was running a surplus to go into a deficit and start borrowing money.  With the advent of first the Afghan War and THEN the unnecessary Iraq War, the US Govt was draining hundreds of billions from the credit market….which is a market like any other.  Demand more money, the price of money goes up….the interest rate.

So now you have a Republican administration through its tax and spend policy borrowing money at rates sure to drive the interest rate up…but it doesn’t go up!!!!?????  Because, the Reagan-appointed Greenspan was, as you so well put it, keeping the rates down.

Had the US govt’s borrowing stayed low, the pressure on the interest rate to rise wouldn’t have been there and these mortgages WOULD have been affordable.  Had, instead, the Fed allowed the interest rates to rise in response to the Bush borrowing, many of those people would never have even been able to get into those mortgages—as you again described.

So, really, the fault lies clearly and totally with the Republican administration of Bush and the incompetent leadership at the Fed of Greenspan.

I’m simply following your logic and putting some clarity into how the mechanisms you so well described led to disaster.

In the summer of 2001 when the tax cuts went and it became IMMEDIATELY apparent that revenue was not going to rise because of stimulus, I told my wife “Uh-Oh.  We are in for it now.  Bush has poisoned the well.”

The well was poisoned and we see the results.

See, Bush always saw a bolus of government money as something to get to his friends, ostensibly as “investing”.  He did it with the U of Tex endowment, which had been the richest, having passed Harvard, and it lost something like 60% of its value.
He did it with the 2001 tax cut.
He did it with the Medicare funding (The WH swore up and down to congress it would top out at $400 billion then 2 days after it passed said “Opps! Did we say $400 billion? We meant $550 billion”.)
He tried to do it again with Social Security. Had he done so millions of seniors would be now homeless or dying.

That’s just the facts.

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By Fat Freddy, October 21, 2010 at 7:51 pm Link to this comment

ITW

If you really want to break it down, you have to look at where the demand for these securities was coming from, and what enabled the mortgage writers to offer these loans, in the first place. The banks couldn’t package these securities fast enough. Lehman was the largest purveyor of these securities. The reason the demand was so high, is because interest rates on 10 year T-Bills was around 2.5%, about what they are now. The securities were sold with AAA ratings, making them “as safe” as Treasuries, but at much higher interest rates. So, the unknowing investor who only wanted someplace “safe” to put their money, and receive an interest rate that would at least keep up with inflation, starting buying up these securities. The Federal Reserve, through the FOMC, manipulates the rate on Treasuries. The Fed was under pressure to keep interest rates low, to keep unemployment low. It was artificially generated low interest rates that fueled the demand for the mortgage securities, in the first place.

The Federal Reserve (FRB) directly controls the Fed Funds Rate, or “Discount Window”. This is the rate at which the FRB loans money to banks. The FRB is “supposed to” follow the market demand, or value, not dictate it. Instead, the FRB intentionally kept the discount window rate well below any natural market demand value. This artificially brought the prime rate down. The prime rates from 2002 and 2006 were 4-5%. It was this low rate that enabled banks to make riskier loans to people with no money down, low income, and/or not-so-great credit, at a higher interest rate than prime, but still “reasonable”. If the fed funds rate was higher, prime rates would have been closer to 9 or 10%, and those riskier loans would not have been “doable”. (The same holds true for these “payday lenders”. If the prime rates were higher, there probably would be no payday lenders, or at least, they wouldn’t have expanded the way they did. The same with credit cards. Traditionally, credit card rates were 20% for people with good credit.)

So, the real cause of the mortgage crisis (there were many other factors which fueled it) was artificially generated low interest rates by the Federal Reserve.

The reason I say people need to be put out of homes they can not afford, is not to be a dick, but to allow home prices to fall. In many areas, the real estate market is extremely overvalued. It was all of those mortgages that caused home prices to soar. The home prices were artificially inflated by people buying them that were not qualified. Like I said, at the end of the day, these people can not afford these homes. You can’t keep people in homes that they can not afford. It’s keeping home prices artificially high. Yes, in many cases the fraud was initiated by the mortgage companies like IndyMac and CountryWide. Do these people deserve compensation? Sure. But the do not deserve a free and clear home. As long as home prices stay artificially high, fewer lower income people will be able to afford them. However, that’s not a “cure-all” because banks don’t want to sell the foreclosed property for less than the note. But that’s another issue.

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By Inherit The Wind, October 21, 2010 at 4:45 pm Link to this comment

FF:

You are STILL talking about a tiny minority of buyers who aren’t just ordinary borrowers who got shafted.  It’s just that simple.  Yes, you do rip the bankers. Remember? I said I was WITH YOU up to that point!

But the problem is more with the system than with the home-owning borrowers.  Where were the mortgage writers when it was CLEAR the borrower wasn’t qualified?  Writing the mortgage anyway!

I agree about being careful about ARMs.  But our SO many people didn’t fully understand them, and others assumed they’d sell before it became an issue.  Remember? The market was NEVER going to go down…That was Bush’s theory behind privatizing Social Security and putting it into the Stock Market…Even the President believed this bullshit.

You didn’t Freddy.  Neither did I.  We had a fixed rate 30 year and when we re-fi’ed the pressure from the banks was INSANE to go with an ARM.  We didn’t and simply went with a better 30 year fixed.

But my big brother, who generally is no dope, took an interest-only though I begged him not to, sure he could sell it.  He’ll be LUCKY to break even on it.

This idea that SO MUCH of the fault is on the little guy and gal is part of what’s gone so hay-wire in America over the last 30 years, and why we’ve lost our competitive edge.

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By REDHORSE, October 21, 2010 at 1:41 pm Link to this comment

You know, despite our common recoginition of the moral vacuum in Washington and its complicity and collusion in the open looting of the American/World economy by financial/corporate thugs, the real elephant in the room is the wars.

    It is impossible to believe the death of millions has no impact on the lives of the citizens who allow the killing to continue. Do the suicide rates of fellow Vets mean nothing?

    And financially, billions of dollars continue to disappear without account. To discuss the one issue as separate from the other is a capitulation.

    Criminals beyond prosecution have seized control of America. I don’t know what the solution may be, but any action taken is defined by the force of this reality.

    For now the power is still with “We the people—-”. I’m not playing for drama and effect when I ask: How long?

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By yrscrewed, October 21, 2010 at 12:11 pm Link to this comment

I wonder how many consumers were forced by a gun put their head? I wonder how much fraud was caused by Freddie Mac and Fannie Mae?  You do know that they have been cooking the books for years and the CEO was fired and they gave him 30 million. LOL
Another Failed Government Program.  Cost the taxpayers trillions.
Also most of the fraud was caused by “Private Mortgage Companies” Like Countrywide and the like who sold their fraud to Bank America and other Banks.

“Where there’s Money there’s Fraud”  &  “If the Government Controls it, it’s completely Fraudulent”
yrscrewed

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By REDHORSE, October 21, 2010 at 11:44 am Link to this comment

I agree with FAT FREDS continued call for personal adult responsibility. The more personal power and responsibility one accepts the more individual control one has over his/her life. The PROBLEM is that the game is rigged from the top down.

    Individual willingness to take the hard medicine of adult decision and say no to the dream of home ownership may or may not save one from bankruptcy and foreclosure but it can never substitute for the failure of vision and moral leadership in those entrusted with oversight and legal responsibility for the financial process itself.

    The system is set up to bleed the individual financially and emotionally. Refusal of a living wage to enforce high interest debt despite a continued increase in worker productivity. An on going attack on social, health, educational services and infrastructure. The gutting of industry and destruction of entire communities. Unless you’re independently wealthy, this is the only game in town.

    FAT FRED has consistently listed resource groups and pointed at community actions people can organize to regain personal control of their lives. That’s where the POWER of the individual is. It’s where we live.

    I found out the hard way that my State has no control over the Charter of National Banks. And, the Federal Reserve doesn’t answer phone calls. (Most Public Regulatory Systems are window dressing anyway.) When I switched to a local bank, the financial hijinx and fee manipulation stopped. Suddenly I had peace of mind and the vampires were gone. At least I now have “some” power in the situation.

      It’s openly recognized that the mortage bubble was a manufactured scam. Financial thugs create and swap mortage companies and banks among themselves at will, and many are set up to loot communities outright. True, people should know better. It is also true that our leadership should ensure oversight that protects them from shell games and con artists. What can I say. Baboonus Washingtonus is a wicked little creature that fouls the air of Liberty and robs us of dignity at every chance.

    I almost always agree with FAT FRED. Positive action is still available. Take it!!

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By Fat Freddy, October 21, 2010 at 10:48 am Link to this comment

“Can YOU read all the fine print on an APR mortgage with hidden clauses and obscure language and be sure you know what you are getting into?”

I would never take out an adjustable rate mortgage when interest rates are low. That’s about the dumbest thing anybody can do. If interest rates are low, the only direction they can go is up. That means your monthly payment will go up. You take out adjustable rates when interest rates are high, then eventually you can refi into a fixed rate when the rates come down. You can’t protect people from stupid. The problem is, only about 7% of high school students are taught personal finance.

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By Fat Freddy, October 21, 2010 at 10:23 am Link to this comment

I was with you all the way until you made this absurd assertion:

Of course you do. Because you see things through blinders. First of all, this guy in the article, Jeffrey Stephan, was in the Philly suburbs. Have you ever been in the Philly suburbs? Haverford, Radnor, Brynmawr? We’re not talking North Philly here. I can tell you, it’s one of the richest places on Earth. In fact, one of those towns, Gladwyne, in Lower Merion, has the highest per capita income in the entire country. Is that what you want to protect? The rich?

You are so blinded by your political bias, you barely acknowledged the fact that I ripped the banks. Look, so maybe they were tricked. So what? Does that mean they deserve a rich house on the Philly Main Line that they can not afford? Have you ever heard of buyer beware. Nobody forced these people to sign those mortgages. Just like nobody forced people to run $20,000 of credit card debt. Ultimately you are responsible for the decisions that you make. If you don’t want to be held responsible, then go home to Mama. Yeah, it’s a shitty mess, and there’s plenty of blame to go around. but until people like you take off your blinders, and take your heart off of your sleeve, we’ll just keep getting more of the same.

Throw the people out the homes they can not afford, and put the bankers in jail for fraud. I guarantee you, that if you put those bankers in jail, this won’t happen again.

You are looking for any excuse just to punish the bankers. The fact is, the bankers should have been punished a long time ago. So, what is Elizabeth Warren really going to do? Her new agency is controlled by the Federal Reserve. Who owns the Federal Reserve? What a fucking joke.

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By Inherit The Wind, October 21, 2010 at 9:38 am Link to this comment

FF,

I was with you all the way until you made this absurd assertion:

“Because at the end of the day, there are people in homes that they simply can not afford. They got in over their heads, for whatever reasons, and now, we have to help them. Bullshit. Do you really want to help the guy that mortgaged out all the equity in his $400,000 home to buy a new speedboat and take a trip to Italy? What the hell kind of sickness is it that liberals suffer from?”

This is the old Ronald Reagan “Welfare Queen”-the rare exception, not the rule.  I sure there were a few low-lifes who did this but that was FAR from the norm—and I think you know it.

What REALLY happened is akin to cigarette advertising. Realtors and mortgage brokers make their $$$ by selling homes and putting people into mortgages.  They were backed by the advertising of the banks and the giant real estate agencies.  Someone says “Hey! You, too can afford a home!” and you go in and ask how.  And they tell you.  But they don’t tell you the WHOLE story, nor the downside risk, nor how the mortgage will be sold and re-sold and re-sold until NOBODY knows who owns it.

And you and most of the right-wing set are OK with all the banks and mortgage companies and realtors washing their hands of any responsibility for one of the BIGGEST cons in American history…Like them, YOU blame the pigeons, not the con artists.

Can YOU read all the fine print on an APR mortgage with hidden clauses and obscure language and be sure you know what you are getting into?

It was a con job, pure and simple, that began with the sub-primes: “When your bank says ‘no’, Champion says ‘Yes’!”

What was a crisis snow-balled into an avalanche.  You are blaming the pawns in the chess game, not the bigger pieces or the chess master.

And that’s wrong.

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By bogi666, October 21, 2010 at 9:07 am Link to this comment
(Unregistered commenter)

RayLan, the Federal deficit is what funds the Pentagram/spy agencies and can be confirmed with a regression analysis.  Reagan initiated the huge Federal deficits, simultaneously increased the Pentagram budgets. In August Admiral Mullen declared the national debt, Federal deficit, is a national security risk an astounding admission that the Pentagram is a risk to national security since it is funded with the Treasury bond proceeds for the Federal deficit. The purpose of the Pentagram is to protect the WEALTHY CORPORATE WELFARE KINGS world wide many of which don’t pay USG taxes but derive the benefits of the tax monies of others taxes. What the USG is running is a protection racket for the WELFARE KINGS benefit. The Pentagram is an admitted threat to national security because it is funded by the national debt proceeds. Pentagram propaganda declares its purpose is to protect Americans from threats to national security and the Pentagram is a national security risk.A national security threat, the Pentagram, is funded to protect against threats to national security. If this seems insanity, it’s because it is insane.

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By Fat Freddy, October 21, 2010 at 7:18 am Link to this comment

Well, what did you expect???? Really. The FBI warned of widespread fraud in the mortgage industry in 2004. Goldman Sachs was accused of selling bad mortgage securities in 2009. Now, banks are foreclosing on homeowners, fraudulently. Is there a pattern here?

1)When the mortgages were written, there was fraud.
2)When the mortgages were packaged and sold, there was fraud.
3)When the mortgages were foreclosed on, there was fraud.

There’s been fraud through this entire process, everybody knows it, but nobody wants to do anything about it. Instead of setting up a Resolution Trust Authority to wind down these big, zombie banks, we get Elizabeth Warren and the Consumer Financial Protection Agency. Well, I guess she can send all of those bankers to bed without their supper, instead of putting them in jail, where they fucking belong.

If there was a truly free market, these banks would have been ripped apart by the vultures and bottom feeders a long time ago, and we wouldn’t be having these problems, and, we would be on the road to a real recovery.

But no. We had to bail out the banks, and then hope that they would pass it along to the deadbeat homeowners. Well, that didn’t work out very well. Do you want to know why? Because at the end of the day, there are people in homes that they simply can not afford. They got in over their heads, for whatever reasons, and now, we have to help them. Bullshit. Do you really want to help the guy that mortgaged out all the equity in his $400,000 home to buy a new speedboat and take a trip to Italy? What the hell kind of sickness is it that liberals suffer from?

Do you want to help the people that got in over their heads, fine. Write them a check for the first month’s, and last month’s rent on a decent apartment. Then they can save their money for a down payment, and rebuild their credit. Combine that, with the auctioning off of the assets of the zombie banks. When the new owner buys an asset from a failed bank, he gets it at a reduced price. It’s like a “going out of business” sale. The new owner can then pass along the real savings, and either a)write down the principle on some of the mortgages, or b)foreclose and place the house up for sale at a reduced price.

Here’s a simple rule of life. When you reward bad behavior, you can bet your sweet bippy, the bad behavior will continue.

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By RayLan, October 20, 2010 at 6:55 pm Link to this comment

You mean it isn’t all the government spending that blew the economy? It ian’t the government that’s responsible for the deficit?

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By ocjim, October 20, 2010 at 5:04 pm Link to this comment

I have to say that Democrats as presidents are becoming more and more agents of big business. Look at the progression of the last 3 Democrats serving as President: Carter was a decent soul who had concerns for the people and our future; Clinton was more of a Nixon in his politics and near the end of his administration deregulated banks, helping to lead to casino capitalism; Obama in too many ways reminds you of Bush policies and a quite diminished concern for average Americans (good rhetoric but very poor performance) but with 3X the intelligence.

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By berniem, October 20, 2010 at 4:18 pm Link to this comment

I’m sure the banks will be prosecuted as soon as we’re done with the Bush/Cheney trials!

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By kdyson, October 20, 2010 at 4:05 pm Link to this comment

I’m speechless…why would there not be a moratorium on
obviously fraudulent foreclosures?

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By SeaClearly, October 20, 2010 at 3:59 pm Link to this comment

“[W]holesale [nationwide] fraud against homeowners and the courts” is revealed.  “[A]ttorneys general from all 50 states announced a bipartisan joint investigation into foreclosure fraud.”  “Foreclosure proceedings” are “suspended.”  “Then the Obama administration signaled that it was not supporting a foreclosure moratorium.”  “Foreclosure operations” resume.

Exactly what would have happened under Bush II.

“When President Obama was running for president, he said one of the first things he’ll do is put a moratorium on foreclosures” and champion “bankruptcy reform.”  Once in office: ‘Well, you know, we don’t want to upset the market.’ 

Exactly the kind of 180s which took place after Bush (“I don’t think our troops ought to be used for what’s called nation-building”) II took (emphasis on took) office.

Senator Obama, during the campaign: “If a mandate was a solution, we could try that to solve homelessness by mandating everyone buy a house.”  President Obama, after the success of all the secret deals with corporations(?): “[Since] a mandate was a solution, we [can now] try that to solve homelessness by mandating everyone buy a house.” http://wp.me/phRi4-mB

Exactly what would have happened under Bush II.

And yes, Press Secretary Gibbs might be appalled by this truthful commentary, and go on a ridiculing offense.  Exactly what Dana Perino, et al, would have done.

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By Obbop, October 20, 2010 at 1:23 pm Link to this comment

Obey your masters you putrid commoners.

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By calltoaccount, October 20, 2010 at 12:53 pm Link to this comment

Published on zero hedge (http://www.zerohedge.com)

Foreclosure Expert Confirms Mortgages Pledged Multiple Times, Not Actually Securitized, Document Problem Is Really a System of “Push-Button Fraud”

By George Washington
Created 10/20/2010 - 11:40
? Washington’s Blog [1]

Yesterday, I showed [2] that mortgages were fraudulently pledged to multiple
buyers at the same time.

Today, foreclosure expert Neil Garfield (former investment banker, trial lawyer
and board member of several financial institutions) confirms [3] this, explains
that the loans were not actually securitized, and the whole “sloppy paperwork”
excuse is really an attempt to explain away a system of push-button fraud:

The game was to move money under a scheme of deceit and fraud… 

***

So the paperwork was carefully created and crafted to cover the tracks of theft.
Most of the securitization paperwork remains buried such that it takes search
services to reach any of them. The documents that were needed to record title
and encumbrances was finessed so that they could keep their options open
when someone made demand for actual proof. The documents were not
messed up and neither was the processing. They were just keeping their
options open, so like the salad oil scandal, they could fill the tank that
someone wanted to look into.”  full article at:
http://www.zerohedge.com/article/foreclosure-expert-confirms-mortgages-
pledged-multiple-times-not-actually-securitized-docume

Wall Street banks and hedge funds, via the wholly owned, operated and non-
accountable black box Depository Trust and Clearing Corp. (DTCC) have been
allowed for years by Congress, the SEC and the DOJ to manipulate markets and
steal trillions from investors (and taxpayers) via the same exact Ponzi
“counterfeiting” crimes in the equities and bond markets (ie. selling the same
exact shares, bonds, TBills, etc. to multiple buyers, without ever being required
to deliver that which they sold to anyone!  It was their extraordinary and
unimpeded $uccess at this—since at least 1997—that emboldened them to
do it with mortgages.

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By REDHORSE, October 20, 2010 at 12:43 pm Link to this comment

What? Shocked again? Who’d a thought it? Wha’cha gonna do about it? Who’ya gonna call? It’s all echoes in a moral vacuum. Interesting that Obama made the “signal” to restart the foreclosures. Those boys are fearless—and they don’t give a #@%k!!

    Imagine the destructive emotional forces that inhabit an American family living inside a home on the brink of foreclosure and eviction. Do you think the damage doesn’t touch us all?

    America is an open wound.

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By raykeith7, October 20, 2010 at 12:30 pm Link to this comment

How do americans fed-up with both parties begin a grassroots movement to establish a third party?
Has that time arrived?

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By wildflower, October 20, 2010 at 11:18 am Link to this comment

Re Goodman:  “Nancy Jacobini of Orange County, Fla., was inside her home when she heard an intruder. Thinking she was being burglarized, she called 911. Police determined the intruder was actually someone sent by JPMorgan Chase to change the locks. And Jacobini wasn’t even in foreclosure!”

Good grief .  . . this kind of situation has the potential for a tragic ending.  I hope some kind of punitive action was taken against JPMorgan Chase.

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Peetawonkus's avatar

By Peetawonkus, October 20, 2010 at 10:41 am Link to this comment

What is the crime of robbing a bank compared to the crime of founding one?
—Bertolt Brecht

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By JenniferBedingfield, October 20, 2010 at 9:41 am Link to this comment

“But in a promising development this week, attorneys general from all 50 states announced a bipartisan joint investigation into foreclosure fraud.”

I would have to assume that the states are feeling the damaging effects of bailing out the corporate crooks who perpetrated the mess in the first place. However, I don’t have any trust that any investigation will do much wonders. In a society that sticks to “shoot first ask later”, the least that they could have done is be principally consistent and called for allowing the banks to first fail and collapse completely before calling for investigations. Yes, it may hurt the people a wee bit at first but that would at least free us of some of the corporate abuse.

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By rationalrevo, October 20, 2010 at 8:56 am Link to this comment
(Unregistered commenter)

This is a good start, but I recently posted on my
blog on how the lenders should be prosecuted for
market manipulation as well, which isn’t really
possible under current law because it only applies to
stocks and bonds, etc.  But I’m making the case that the law needs to be changed so that at the very least
in the future this type of activity could be
prosecuted for market manipulation.

See my post here:
http://www.rationalrevolution.net/blog/index.blog?
entry_id=2071334

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By Jim Yell, October 20, 2010 at 7:28 am Link to this comment
(Unregistered commenter)

These crimes will continue until and only if our government stops trying to pretend they are not crimes and start putting CEOs and CFOs in prison and seizing their ill gotten weatlth. They are guilty of treason, murder (the number of people dying directly from their theft)and until the government starts doing their jobs it will continue.

Bush started it why has Obama continued it?

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By Rixar13, October 20, 2010 at 6:05 am Link to this comment
(Unregistered commenter)

” Police determined the intruder was actually someone sent by JPMorgan Chase to change the locks. And Jacobini wasn’t even in foreclosure!”
Shoot to kill….... Smile grin

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By tedmurphy41, October 20, 2010 at 5:50 am Link to this comment

So, are we now going to have the belated experience of seeing these people face indictments for this specific behaviour?

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By SoTexGuy, October 20, 2010 at 5:18 am Link to this comment

Another great piece from Amy Goodman.. But I’m suspicious of the rapid momentum building (finally) for some relief or remedy to the foreclosure crisis..

It all sounds so good! .. and if you are losing your home or have friends and family who may be then it may look like a real life saver. I just can’t get past the reality that when Congress or the government acts it may or may not meet our personal expectations but always creates some new benefit for business or government.

Who could benefit from stopping the tumble in real estate values? We’ll be told that it’s the average American homeowner who will profit.. and I guess so if you accept that we all need to live on credit and need the inflation in housing prices to borrow against.

But won’t the banks be the big winners? Lending more, getting those fees and interest and penalties (and when we crash again, another round of foreclosures)..

Don’t forget how much government is dependent on property tax levies for their revenue.. so local and county entities will most surely get a bonus if foreclosures stop..

Mostly, I suspect it’s the huge and immensely powerful real estate associations and builders and developers that are really pushing this.. It’s a given that ultimately, salespeople rule the world. and if you’ve ever been through an open house or a time-share promo with some of these people you know it’s true!

Personally, I’m still ambivalent over the idea of pumping up the real estate market.. I own my home, don’t want to sell it and enjoy not seeing my taxes go up every two years!  and I suspect there are many more people just like me than you would think if you just watched all the hooey about stopping the evil banks from foreclosing on the American dream..

In fact, homeowners like myself or people who are not behind in their mortgage contracts surely outnumber people in foreclosure.. and one way to view government action on restructuring loans and stopping foreclosures is as a BAIL OUT for most everybody but us. For those who, by hook or crook or just plain irresponsibility took on more debt than they should..

In those terms it looks almost exactly like the Wall Street bail-out! Second verse, same as the first.

Adios!

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By Rigor, October 20, 2010 at 4:53 am Link to this comment

And, of course, its worse than we
thought:http://theeconomiccollapseblog.com/archives/the
-biggest-bank-robbery-in-history-more-quantitative-
easing-backdoor-bailouts-for-the-big-banks-without-
having-to-go-through-congress
What is to be done when the cops are the crooks?

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By Inherit The Wind, October 20, 2010 at 4:45 am Link to this comment

That’s OK.  When it gets to the Bush/Reagan Supreme Court they’ll decide 5:4 that it’s perfectly legal for a bank to break in and seize your home without proof they own it or proof you are in default.  They won’t even need the sheriff to evict you!

In fact, once you sign the mortgage they own the house.  In fact, even if your neighbor signs a mortgage and you don’t have one, they can claim they own your house! Just ask Roberts, Alito, Scalia, Thomas and Kennedy!

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By Sofie-Alice, October 20, 2010 at 4:03 am Link to this comment

Indeed a disaster and we have to do something. The marked remark is .... A healthy market has competitive offer and consumption. Those politicians!
Bucarest Appartamenti

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By Sofie-Alice, October 20, 2010 at 3:57 am Link to this comment

Banks always care their own interests, sometimes supported by politician. If a profit can be made from the crisis, then it will be made.
Apartamente de Inchirat Bucuresti

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By G.Anderson, October 19, 2010 at 8:01 pm Link to this comment

Yes, Amy you finally cut loose….they sold out the people of this country, for greed…...

Turned the American people into debt slaves, bought the congress. Then they
destroyed our economy got the tax payer to bail them out, when that money should
have helped the people.

Next they want to get rid of social security, so they can extend their greed to the rest of
the world via our military. 

They are traitors to this country and everything it’s supposed to stand for.

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By calltoaccount, October 19, 2010 at 6:21 pm Link to this comment

It’s a lot worse than “thousands of legal documents signed by low-level staffers
with little or no knowledge of what they were signing.”  The process is
fraudulent to the core


The Foreclosure Crisis: Punchline to a Michael Lewis Joke from 2008?
Posted on 18 October 2010 by Patrick Byrne

“...In late 2008 Michael Lewis wrote a Portfolio article (“The End“) weaving
together a story line concerning a then-recent lunch between himself, Michael
Lewis, and John Guttfreund of Salomon Brothers and Liar’s Poker fame (thus,
arguably, nemeses), and another concerning Steve Eisman, a money manager
who bet heavily against the MBS market.  The climax of this latter story runs as
follows:
“That’s when Eisman finally got it. Here he’d been making these side bets with
Goldman Sachs and Deutsche Bank on the fate of the BBB tranche without fully
understanding why those firms were so eager to make the bets. Now he saw.
There weren’t enough Americans with shitty credit taking out loans to satisfy
investors’ appetite for the end product. The firms used Eisman’s bet to
synthesize more of them. Here, then, was the difference between fantasy
finance and fantasy football: When a fantasy player drafts Peyton Manning, he
doesn’t create a second Peyton Manning to inflate the league’s stats. But when
Eisman bought a credit-default swap, he enabled Deutsche Bank to create
another bond identical in every respect but one to the original. The only
difference was that there was no actual homebuyer or borrower. The only
assets backing the bonds were the side bets Eisman and others made with firms
like Goldman Sachs. Eisman, in effect, was paying to Goldman the interest on a
subprime mortgage. In fact, there was no mortgage at all. ‘They weren’t
satisfied getting lots of unqualified borrowers to borrow money to buy a house
they couldn’t afford,’ Eisman says. ‘They were creating them out of whole cloth.
One hundred times over! That’s why the losses are so much greater than the
loans. But that’s when I realized they needed us to keep the machine running. I
was like, This is allowed?’” 
...If Lewis was right, banks packaging up mortgages did not just do a sloppy
job in the packaging. They were also selling those packages several times over.
Which, to readers of DeepCapture.com, may sound familiar.
If this is really what is happening down below, how would things appear on the
surface? Like this: a bunch of lawyers representing the interests of owners of
these “mortgage”-backed securities would be going into court trying to
foreclose on homes, but not be able to establish clear chain of title. Which is
precisely what is happening. That’s not the same as saying it is why it is
happening. However, if Lewis’ story about Steve Eisman is correct, then
eventually this would have to happen.
Whatever the cause (or amalgam of causes) of this foreclosure crisis, its effects
could ripple into our financial system in a way that some say will become
catastrophic (e.g., “The Real Danger from the Foreclosure Crisis“, George
Washington, Zerohedge).  Banks which believe that millions of people owe them
money suddenly realizing that no specific people owe them money while
millions of borrowers suddenly realize they don’t owe money to any specific
bank; banks suspend foreclosures, but people thrown out of their homes by
banks who lacked chain of title form classes to recover what is rightfully theirs;
title insurance becomes impossible on a non-negligible fraction of homes.
Etc…

http://www.deepcapture.com/is-the-foreclosure-crisis-the-punchline-to-a-
michael-lewis-joke-from-2008/

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By mkwrk2, October 19, 2010 at 6:02 pm Link to this comment

When Banks Are the Robbers…

When they are not?

Michael Kerjman

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By babycatajesus, October 19, 2010 at 5:08 pm Link to this comment

What a disaster!

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By Barbara Ann Jackson, October 19, 2010 at 4:57 pm Link to this comment

Underhanded foreclosures are more criminally exploitive than what becomes reported.  Appalling collection abuses have resulted in mill lawyers (or their affiliates) obtaining ownership of fraudulently foreclosed properties via purported bids at “simulated” auctions with “straw buyers;” and afterwards, some properties become “flipped” illegally to Freddie Mac!  Some foreclosure mill lawyers even have filed into court records fee-making pleadings (summary judgments, etc) when Freddie Mac is not party to cases (proof @ http://www.lawgrace.org ), and they bill $$$$ fees pretending to represent Freddie Mac.

Through falsified Bankruptcy Court pleadings, some lawyers wrongfully, illegally impede homeowners’ restructuring debts, and impede discovery of the actual owners of mortgage notes.  False bankruptcy “Lift Stay” motions in names of either defunct lenders or lenders with no ownership of property notes not only help illegal property repossessions, any other creditors whom debtors owe, becomes deprived wrongfully of entitled shares of proceeds from those auction frauds; and ILLEGITIMATE “deficiency judgments” ; and third party debt-buyers seeking money after unfairly low auction (straw purchase) bids resulted in large debt balances are also problems.

Plus, dishonest foreclosure mills work in concert with Wells Fargo.  Among other things, Wells Fargo has tax advantage from fraudulent foreclosure proceedings after placing distressed homeowners’ names / social security numbers on false IRS (acquisition) form 1099-A’s, even when no lawful “acquisition” of properties occurred; such homeowners wrongfully become forced to explain these turn of events to the IRS after surprise receipts of tax bills.  “Fee-splitting” is also an element of intentional, fraudulent foreclosure. *read about fee splitting:  “Lender Processing Services Discusses Legal Issues” @ http://quicktake.morningstar.com/Stocknet/san.aspx?id=354567

People who think that people who can no longer afford their mortgage should pack up and move out, ignore that it is unjust to render people homeless by use of intentional, dishonest, illegal foreclosure proceedings.  Foreclosure mill illegalities accounts for “illegal foreclosures” and “Tent Cities” which could be Anyplace, USA. 

Foreclosure fraud (on farmers, businesses, as well as residences) MUST become investigated;”  it can cripple peoples’ abilities to move forward with their lives for a very long time –and the cloaked perpetrators are often millionaires; those perpetrators are as bad as, or worse than Bernie Madoff.
=================================================================
“Case In Point: Foreclosure Mills, Judicial Fraud, Consumer Exploitation. . .” http://open.salon.com/blog/wwwlawgraceorg/2010/08/18/case
_in_point_foreclosure_mills_judicial_fraud_consumer


OPEN LETTER TO PRESIDENT OBAMA on Foreclosure Crisis (concerning Wells Fargo)
http://www.pr-inside.com/open-letter-to-president-obama-on-foreclosure-crisis-r1505916.html

Lehman Brothers, Wells Fargo Foreclosure and Insurance Claims
http://www.lawgrace.org/2008/09/14/lehman-brothers’-mortgage-troubles-nationally-evidence-of-
foreclosure-fraud-deception-and-conspiracy-with-wells-fargo-deceptive-judicial-filings/

Important Facts About Foreclosure and Mortgage Fraud
http://www.lawgrace.org/2010/09/30/important-facts-about-foreclosure-and-mortgage-fraud/

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