Chain of Title
Page 40
33 skyrocketing early payment defaults: McLean and Nocera, All the Devils Are Here, 251.
33 Foreclosures started to occur in large enough numbers: Al Yoon, “Foreclosure Rates Almost Doubled in 2007: Report,” Reuters, January 29, 2008; Les Christie, “Foreclosures Up a Record 81% in 2008,” CNN Money, January 15, 2009.
33–34 Garfield called them “pretender lenders”: Sample complaint template, Living Lies, https://livinglies.files.wordpress.com/2008/11/template-complaint1.pdf.
34 “The reality is that nearly all securitized mortgage loans are worthless”: Neil Garfield, “NY Times Says It All—Almost—Foreclosures: No End in Sight,” Living Lies, June 2, 2009.
34 “The ONLY parties seeking foreclosures”: Neil Garfield, “A Reality Check on Mortgage Modification—NYTimes Gretchen Morgenson,” Living Lies, April 26, 2009.
34 “Democracy is not supposed to be efficient”: Wendell Sherk, “Why Show Me the Note Matters,” Bankruptcy Law Network, March 17, 2009.
3. Securitization FAIL; or, Cirilo Codrington and the Panama Doc Shop
35 Home Affordable Modification Program, or HAMP: “Remarks by the President on the Mortgage Crisis,” Dobson High School, Mesa, Arizona, February 18, 2009.
37 This desire for “bankruptcy remoteness” drove securitization transfers: Mike Konczal, “Foreclosure Fraud for Dummies, 1: The Chains and the Stakes,” Rortybomb (blog), October 8, 2010, https://rortybomb.wordpress.com/2010/10/08/foreclosure-fraud-for-dummies-1-the-chains-and-the-stakes.
37 “On the Closing Date, the Depositor will transfer”: Prospectus, Sound-view Home Loan Trust 2006-OPT2, June 18, 2007, www.sec.gov/Archives/edgar/data/1356081/000088237706000772/d454063_fwp.htm.
38 And under New York law, there was no mechanism: Professor Adam Levitin, Georgetown University, testimony in hearing before the House Financial Services Committee, Subcommittee on Housing and Community Opportunity, November 18, 2010, 56–57, www.gpo.gov/fdsys/pkg/CHRG-111hhrg63124/pdf/CHRG-111hhrg63124.pdf.
38 There are tax consequences associated with this failure: 26 U.S. Code § 860F (a).
39 “There is an 18-minute Nixonian gap”: Neil Garfield, “Ohio Slam Dunk by Judge Morgenstern-Clarren: US Bank Trustee and Ocwen Crash and Burn,” Living Lies, June 29, 2009.
39 a November 2007 report by law professor Katherine Porter: Katherine Porter, “Misbehavior and Mistake in Bankruptcy Mortgage Claims,” Texas Law Review 87 (2008).
40 This was the “re-establishment of lost note” count: Florida Statute § 673.3091.
40 filed a motion to dismiss for lack of standing: US Bank N.A. v. Lisa Epstein, Case No. 50-2009-CA-005542XXXXMB, docket report at http://courtcon.co.palm-beach.fl.us/pls/jiwp/ck_public_qry_doct.cp_dktrpt_frames?backto=P&case_id=502009CA005542XXXXMB&begin_date=&end_date=.
41 Florida Default Law Group (FDLG): Ibid.
41 The newly found note was not endorsed in blank: Copy of note in possession of author.
41 Furthermore, the mortgage assignment went directly: Assignment of Mortgage for Lisa and Alan Epstein, dated May 21, 2009, Public Records of Palm Beach County, Florida. File No. F09015624.
42 “**Chase Home Finance LLC as-attorney-in-fact-for” affidavit: Can be found in Lisa Epstein comment to Florida Supreme Court, October 7, 2009, www.floridasupremecourt.org/pub_info/documents/foreclosure_comments/Filed_10-07-2009_Epstein.pdf.
42 U.S. Bank’s address was listed: https://www.chase.com/home-equity/contactus.
42 JPMorgan Chase had had a ninety-day closing window: Available at SEC website, http://google.brand.edgar-online.com/DisplayFilingInfo.aspx?Type=HTML&text=%2526lt%253bNEAR%252f4%2526gt%253b(%22MATTHEW%22%2c%22WONG%22)&FilingID=5245705&ppu=%2fPeopleFilingResults.aspx%3fPersonID%3d2964553%26PersonName%3dMATTHEW%2520WONG.
43 One screenshot showed that DHI Mortgage: Copy of screenshot in possession of author.
43 The mortgage assignment, dated three months: Assignment of Mortgage for Lisa and Alan Epstein, dated May 21, 2009, Public Records of Palm Beach County, Florida. File No. F09015624.
43 When she typed in Cirilo Codrington: https://www.facebook.com/cirilo.codrington.
44 “the premier legal and financial support services provider in Panama”: Firm Solutions Panama corporate website, http://fspanama.iapplicants.com.
44 Lisa found one Facebook page where Firm Solutions: https://www.facebook.com/pages/Firm-Solutions-Panama-Florida-Default-Law-Group/107309169302890.
45 Mortgage originators sold $1.9 million worth: Adam B. Ashcraft and Til Schuermann, “Understanding the Securitization of Subprime Mortgage Credit,” Federal Reserve Bank of New York staff report, March 2008. The data show $1 trillion in subprime and Alt-A mortgage originations in 2005 and 2006. That calculates to a perminute rate of approximately $1,902,587.
45 Property recordation: Jill E. Martin, Hanbury and Martin: Modern Equity, 19th ed. (London: Sweet and Maxwell, 2012), 9.
46 The Statute of Frauds: Statute of Frauds, 1677, accessed at www.languageandlaw.org/TEXTS/STATS/FRAUDS.HTM.
46 “What creates capital”: Hernando de Soto, The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else (New York: Basic Books, 2000), 46–47.
46 The Massachusetts Plymouth Bay Colony established: George L. Haskins, “The Legal Heritage of Plymouth Colony,” University of Pennsylvania Law Review 110 (1962): 856–57.
46 They created land registration offices: Christopher L. Peterson, “Foreclosure, Subprime Mortgage Lending, and the Mortgage Electronic Registration System,” University of Cincinnati Law Review 78, no. 4 (Summer 2010): 1364–65.
47 the Mortgage Electronic Registration Systems (MERS): Ibid., 1368–70.
47 MERS as the “mortgagee of record”: Ibid., 1362.
48 Law professor Alan White: Michael Powell and Gretchen Morgenson, “MERS, the Mortgage Holder You Might Not Know,” New York Times, March 5, 2011.
48 In re Hawkins: United States Bankruptcy Court, D. Nevada, March 31, 2009, Case No. BK-S-07-13593-LBR.
49 “To grant MERS standing based on legal title”: Peterson, “Foreclosure,” 1384–85.
49 MERS sold their corporate seal: Ibid., 1392.
50 based on the principle of privity: Jesse W. Lilienthal, “Privity of Contract,” Harvard Law Review 1, no. 5 (December 15, 1887).
4. The Originator
51 a consultancy and research firm called the Sports Marketing Group: “NBA Booming, but Football Is America’s Favorite Sport,” Associated Press, February 21, 1991.
51 He called the rise of figure skating: Shannon Brownlee, Katia Hetter, and Karen Nickel, “The Value of Grace, the Price of Spunk,” U.S. News and World Report, January 16, 1994.
52 SOA would tack on a late fee anyway: Nye Lavalle, “Predatory ‘Grizzly Bear’ Attacks Innocent, Elderly, Poor, Minorities, Disabled and Disadvantaged,” 23–25, www.msfraud.org/Articles/predbear.pdf.
52 Loan servicers were mostly automated: Adam J. Levitin and Tara Twomey, “Mortgage Servicing,” Yale Journal on Regulation 28, no. 1 (December 15, 2010).
52 force-placed insurance: Lavalle, “Predatory ‘Grizzly Bear,’” 5–6, 32–33.
53 Sometimes monthly payments were missing: Ibid., 27–34.
53 “miscellaneous advances”: Ibid., 29.
53 “mortgage toxic waste dump”: Ibid., 21–22.
54 So the entire transaction was an elaborate game: Ibid., 93–94.
54 Nye wondered if EMC even had custody: Ibid., 93.
54–55 “the actual owners of the note or mortgage”: Lavalle, “Predatory ‘Grizzly Bear,’” 104.
55 Ultimately the new judge ruled for EMC: Lavalle, “Predatory ‘Grizzly Bear,’” 102–3.
56 They devised ways to digitally extract profits: National Consumer Law Center, “Why Servicers Foreclose When They Should Modify and Other Puzzles of Servicer Behavior,” October 2009.
56 At one point Nye counted forty-four different schemes: Nye Lavalle, “White-Collar Mafia Uses 21st Century Loan Sharks to Prey on Americans,�
� 25–26, http://documents.jdsupra.com/197d1b59-e33e-47e0-92b0-d61992e9ed22.pdf.
56 referred to its customers as “smucks”: Ibid., 30.
56 “nothing—and I mean nothing—that a bank”: Gretchen Morgenson, “A Mortgage Tornado Warning, Unheeded,” New York Times, February 4, 2012.
56 Banks would “double-pledge” mortgages: Nye Lavalle, “You Can’t Trust the Mortgage Paper Trail,” 2013 ed., 23–24, http://stopforeclosurefraud.com/wp-content/uploads/2013/04/CantTrustPaperTrail_Lavalle_4-13.pdf.
57 “Predatory Grizzly ‘Bear’ Attacks Innocent”: Lavalle, “Predatory ‘Grizzly Bear,’” 1–102.
57 “to defend and protect Americans”: Lavalle, “White-Collar Mafia,” 1.
57 “Well-known banks and mortgage companies”: Ibid., 2.
58 “to support knowledge of facts”: Lavalle, “You Can’t Trust,” 8.
58 Nye later published an entire report in 2008: Nye Lavalle, “Sue First and Ask Questions Later: A Pew Mortgage Investigations Report on the Predatory Servicing Practice of False and Forged Signatures Employed by Ocwen & Others,” 2008, www.scribd.com/doc/20955838/PMI-Ocwen-Anderson-Report-Sue-First-Ask-Questions-Later.
59 He predicted the financial crisis: Lavalle, “Predatory ‘Grizzly Bear,’” 15–19.
59 A judge forced the closure of some: Bear Stearns Companies, Inc. v. Lavalle, U.S. District Court, Northern District of Texas, December 3, 2002, summary at www.finnegan.com/BearStearnsCompaniesIncvLavalle.
59 consumer websites like RipoffReport: “Ameriquest Mortgage Company aka AMC Complaint Review,” RipoffReport, March 27, 2005.
59–60 Nye infiltrated the corporate message board for MERS: Brady Dennis and Ariana Eunjung Cha, “Reston-Based Company MERS in the Middle of Foreclosure Chaos,” Washington Post, October 8, 2010.
61 Nye was blocked from reading a study: Morgenson, “A Mortgage Tornado Warning.”
61 With the saccharine title “Report to Fannie Mae”: Marc Cymrot, “Report to Fannie Mae Regarding Shareholder Complaints by Mr. Nye Lavalle,” Office of Corporate Justice Case No. 5595, May 19, 2006, available at www.nytimes.com/interactive/2012/02/05/business/05fannie-doc.html.
61 “Mr. Lavalle is partial to extreme analogies”: Ibid., 3.
61 “Lavalle has identified an issue”: Ibid., 5–6.
61 “Mr. Lavalle’s assertion that Fannie Mae faces”: Ibid., 7.
62 Ford Pinto memo: Mark Dowie, “Pinto Madness,” Mother Jones, September/October 1977.
62 “the fraud of our lifetime”: Morgenson, “A Mortgage Tornado Warning.”
5. The Community
66 “So it was that in the fall of 1932”: T. H. Watkins, The Great Depression: America in the 1930s (Boston: Little, Brown, 1993), 118–19.
66 Home Defenders campaign: Fernanda Santos, “Nationwide Effort Takes Shape to Support Families Facing Foreclosure,” New York Times, February 18, 2009.
66 ACORN members reclaimed Donna Hanks’s abandoned foreclosure: Bertha Lewis, “We Are Willing to Go to Any Means Necessary,” Huffington Post, February 20, 2009; WJZ-TV Baltimore report, February 20, 2009, accessed at https://willnevergiveup.wordpress.com/2009/02/23/acorn.
66–67 Another group called the Neighborhood Assistance Corporation of America: John Christoffersen, “Housing Group Stages Protests at Bank Executives’ Homes,” Associated Press, February 9, 2009.
67 “Bushvilles”: Jesse McKinley, “Cities Deal with a Surge in Shantytowns,” New York Times, March 25, 2009; David Neiwert, “Tent Cities: Welcome to the New Bushvilles,” Crooksandliars.com, March 9, 2009, http://crooksandliars.com/david-neiwert/tent-cities-welcome-new-bushvilles.
67 a way to “foam the runway”: Neil Barofsky, Bailout: How Washington Abandoned Main Street While Rescuing Wall Street (New York: Simon and Schuster, 2012), 156–57.
67 his administration pressured congressional leaders: Paul Kiel and Olga Pierce, “Dems: Obama Broke Pledge to Force Banks to Help Homeowners,” Pro Publica, February 4, 2011. Also David Dayen, “Portrait of HAMP Failure: How HAMP Went from the Bank’s Counter Offer to the Whole Enchilada,” September 13, 2010, http://shadowproof.com/2010/09/13/portrait-of-hamp-failure-how-hamp-went-from-the-banks-counter-offer-to-the-whole-enchilada.
67 “frankly own the place”: Ryan Grim, “Dick Durbin: Banks ‘Frankly Own the Place,’” Huffington Post, May 30, 2009.
67 Treasury Department bigwigs would come in afterward: Kiel and Pierce, “Dems: Obama Broke Pledge.”
67 The banks blamed homeowners: Pat Garofalo, “Banks Blame Borrowers for Lack of Progress on Mortgage Modifications,” ThinkProgress.org, December 9, 2009.
67 Servicers turned HAMP into a predatory lending program: Dayen, “Portrait of HAMP Failure.”
68 Bank of America employees later testified they were given: David Dayen, “Bank of America Whistleblower’s Bombshell: We Were Told to Lie,” Salon, June 18, 2013.
68 Robert “Jack” Wright: Denise Richardson, “Why We Need the Right to Receive a Monthly Mortgage Statement,” GiveMeBackMyCredit.com, April 24, 2008.
68 Fairbanks would eventually settle: “Fairbanks Capital Settles FTC and HUD Charges,” Federal Trade Commission press release, November 12, 2003. Also “Fairbanks Capital Changes to Select Portfolio Servicing, Inc.,” Select Portfolio Servicing press release, July 1, 2004, PRNewswire.com.
68 Mike Dillon: Link to GetDShirtz.com is now dead. Mike’s story can be found at the Home Preservation Network, http://homepreservationnetwork.com/2012-10-23-03-10-19/stories-from-homeowners/item/2776-mike-dillon-manchester-nh.
68 “My foreclosure was filed August 2008”: Living Lies, “Florida Petition Seeks Mediation of Foreclosures,” March 11, 2009, comment by user bt.
68 “Can a foreclosure, in Florida, still take place”: Living Lies, “Reality Check: Holder in Due Course Doctrine Is Not Some Fancy Trick to Get Out of Paying,” April 5, 2009, comment by user Viper.
69 Ana Fernandez: Gretchen Morgenson, “Guess What Got Lost in the Loan Pool,” New York Times, March 1, 2009.
69 Samuel Bufford: Ibid.
69 Judge Walt Logan: Mike McIntire, “Tracking Loans Through a Firm That Holds Millions,” New York Times, April 24, 2009.
69 “If you are going to take away someone’s house”: Michael Powell, “A ‘Little Judge’ Who Rejects Foreclosures, Brooklyn Style,” New York Times, August 31, 2009.
69 Anna Ramirez: Todd Wright, “My Bad! Woman’s House Mistakenly Auctioned by Bank,” NBC6 Miami, August 20, 2009.
69 Tony Louzado: Drew Griffin and Jessi Joseph, “Are Some Law Firms Cutting Corners on Foreclosures?” CNN.com, October 23, 2010.
70 someone with the username “Fraud in FL” commented: Living Lies, “NY Times Exposes MERS,” April 24, 2009, comments by users Fraud in FL, Alina, and Lisa E.
71 “They may sit there all day for a week”: Susan Martin, “Tampa Bay Companies Help Lenders Transfer Home Loans, Foreclose,” Tampa Bay Times, May 1, 2009.
72 Florida Default Law Group withdrew that affidavit and then filed one: Available in Lisa’s comment to the Florida Supreme Court, October 7, 2009, www.floridasupremecourt.org/pub_info/documents/foreclosure_comments/Filed_10-07-2009_Epstein.pdf.
76 “And then it started like a guilty thing”: Shakespeare quoted in Lisa Epstein, “Wells Fargo: Who Are They and Why Did They Have the Power to Deny a Solution to My Mortgage?” Foreclosure Hamlet, October 17, 2009.
76 “This Blog is NOT to be viewed as a source”: Lisa Epstein, Foreclosure Hamlet homepage, www.foreclosurehamlet.org.
76 “When I get those large white envelopes”: Lisa Epstein, “FDLG New Filing with the Court: Plaintiff’s Response to my Request for Production,” Foreclosure Hamlet, October 6, 2009.
77 The Kansas Supreme Court decided the case of Boyd Kesler: Landmark National Bank v. Boyd Kesler, Kansas Supreme Court, No. 98,489, August 28, 2009. Also Neil Garfield, “Kansas Supreme Court Sets Precedent—Key Decision Confirming Living Lies’ Strategies,” Living Lies, September 23, 2009.
77 Kurt Aho: Neil Garfield, “The High Cost of Losing Homes: Death by Gunshot,” Living Lies, September 30, 2009, comments by users Lisa E and Foreclosure Fraud.
6. Mr. Anonymous
80 the Boynton Beach campus shut down: Marcia Heroux Pounds, “Motorola to Close Boynton Plant,” Orlando Sun-Sentinel, January 23, 2004.
80 retail and residential development called Renaissance Commons: Brian Bandell, “Renaissance Commons Loses $52m Foreclosure as Auction Looms,” South Florida Business Journal, August 16, 2013.
84 a sweetheart deal for JPMorgan Chase to purchase WaMu: Christopher Palmeri, “JPMorgan Chase to Buy Washington Mutual,” Bloomberg News, September 26, 2008.
85 Nye’s report about Ocwen employee Scott Anderson: Nye Lavalle, “Sue First and Ask Questions Later: A Pew Mortgage Investigations Report on the Predatory Servicing Practice of False & Forged Signatures Employed by Ocwen & Others,” 2008, www.scribd.com/doc/20955838/PMI-Ocwen-Anderson-Report-Sue-First-Ask-Questions-Later.
86 This assignment was dated April 20, 2009: Clerk of St. Lucie County Public Records, book 3081, page 231, recorded April 20, 2009.
88 “I have researched this in my county records”: Susan Martin, “Tampa Bay Companies Help Lenders Transfer Home Loans, Foreclose,” Tampa Bay Times, May 1, 2009.
88 “Looking Up Public Records”: Michael Redman, “Looking Up Public Records,” 4closurefraud.org, October 18, 2009.
90 “Any feedback is welcomed, good and bad”: Living Lies, “Double Funding, Fabrication of Documents and Forgery of Signatures Revealed,” October 5, 2009, comment posted on October 11 by user Foreclosure Fraud.
90 “This is so blatant and outrageous”: Karl Denninger, “A Birdie on Possible Foreclosure Frauds,” Market Ticker, October 15, 2009, available at www.freedomsphoenix.com/News/59786-2009-10-15-a-birdie-on-possible-foreclosure-frauds.htm.