Saturday, September 10, 2011

Suspended Counsel Convicted Of Helping Client Break Into, Reclaim Foreclosed Home; Lawyer Faces Similar Charges In Neighboring Counties

In Orange County, California, North County Times reports:

  • A San Diego attorney whose law license has been suspended was convicted [] of helping a client break into his foreclosed Newport Beach home. It took jurors about an hour to convict Michael Theodore Pines, 59, of vandalism, attempted second-degree burglary, the attempted unauthorized entry of a dwelling and obstructing an officer, all misdemeanors.

  • After the verdicts were read, Orange County Superior Court Judge Andre Manssourian ordered deputies to handcuff Pines and take him into custody, Deputy District Attorney Pete Pierce said. [...] Pines, who has been declared ineligible to practice law, faces similar misdemeanor charges in Ventura County, and felony charges in San Diego County, Pierce said.


  • Co-defendant Rene Hector Zepeda, 72, pleaded no contest before the trial started to a misdemeanor count of trespassing. He testified that thought it was OK to break into his foreclosed home, because he relied on Pines' legal advice, Pierce said.

For more, see Foreclosure attorney convicted in Orange County.

Protestor Invasion Of Bankster Headquarters Demanding Loan Mod Yields Paltry Cash For Keys Offer; Borrower Response: Take A Hike, I'll Keep Fighting!

In Pasadena, California, the Pasadena Star News reports:

  • Bassett resident Rose Gudiel rejected a $4,000 cash offer to leave her home without a fight late Monday afternoon at a meeting with OneWest Bank officials. "It was a pretty short meeting and it was basically cash for keys," she said. "They were very adamant about not being able to do anything beyond that."

  • The meeting came just four days after Gudiel received her evection notice and 11 days after 50 protestors invaded the lobby of the Pasadena bank. Gudiel insisted she's not budging from her home [...]. A court date on the eviction notice has been set for Sept. 6 in Los Angeles Municipal Court.

  • "I'm going to keep fighting for my home and I told them that," Gudiel said. "If they bring the police to arrest me, I'm not leaving."

  • Gudiel, a state employee, has been attempting to get the bank to modify her loan, which requires a $2,456 monthly payment, for almost two years. The request came after her brother was gunned down in La Puente in 2009, causing the household income to drop, she said.

  • Although the income has long since recovered, the bank has consistently refused to give her a loan modification, she said. "They came into the meeting and basically said, 'we reviewed your paperwork and this is the best we can do,"' Gudiel recounted. "Which is nothing."

  • Gudiel secured meeting with bank officials after she and a group of 50 protesters overwhelmed security and briefly commandeered OneWest's corporate headquarters [...] Pasadena. OneWest has declined to comment.

For more, see Homeowner rejects $4,000 deal to leave her home without a fight.

Over Two Dozen Mobile Home Park Residents Face The Boot As Rent-Skimming Owner Loses Premises In Foreclosure Sale

In Jonesboro, Georgia, WSB-TV Channel 2 reports:

  • Nearly 30 neighbors in Clayton County say they are forced to find a new place to live, even though they have been paying rent. People living in the Royal Court mobile home park told Channel 2’s Amy Napier Viteri the bank foreclosed on the property, but no one bothered to tell them until now.

  • According to court documents, the bank foreclosed on the property in May, but neighbors say they’ve been paying their rent and water bills all along. Now, they say they have being told they need to move out and have no idea what happened to the money they paid. “How dare you? How dare you do that to us. We were blinded,” renter Kayla Kennedy said.

  • Kennedy wants to know where her money has been going. She paid rent on the lot for her trailer she bought last year. She showed Viteri the bill of sale, but said the woman from whom she bought it, who also runs the mobile home park, may not even have been the owner. “The bank told me she had not made a payment in over two years, so they were already in proceedings to do the foreclosure on the property,” Kennedy said.

  • "We have nowhere to go. We’re fixing to lose our home, everything I’ve got,” neighbor Sheila Sheffield. Sheffield told Viteri they paid monthly rent and water bills to a woman named Wanda Nguyen, who they believed owned the property. Now, a manager told them Nguyen lost the property to foreclosure and water will soon be shut off.

  • Sheffield said she and several others are on fixed incomes and live in the trailer park because it’s all they can afford. “We don’t even have a car. We don’t even have a way to leave out of here,” Sheffield said.


  • Kennedy told Viteri the bank told her they have 30 days to move out, but she is trying to get that extended. If the water company shuts off water to the park, they will have to leave even sooner than that, Kennedy said.

For the story, see Residents forced to move out while paying rent.

Tenant Suit: Flying Rodents Drove Us Out 6 Days After Coughing Up $36K In Advance For 1-Year Apt. Lease; Pair Wind Up In ER For Series Of Rabies Shots

In New York City, the New York Post reports:

  • Two Manhattan women say they fled their Washington Heights apartment in horror after discovering it was already occupied — by bats. In papers filed in Manhattan Supreme Court, Dimitra Mallarios, 56, and Irene Katehis, 23, say they were duped into paying a full year’s rent for an apartment at 640 Fort Washington Ave., only to discover that some flying rodents were already at home in the fifth floor pad.

  • The pair moved into their $2,500-a-month batcave on July 25, but soon found out they weren’t alone in the fifth-floor pad, their court papers say. Two days after they moved in, "Mallarios encountered a bat" which was "flying around one of the rooms in the aprtment," the suit says. The "very scared, nervous and upset" tenant called the building’s super, who "was able to catch the bat in a plastic bag and remove it from the premises," the suit says.

  • The pair "believed that the premises was free from bats and decided to remain in the apartment," the suit says — but the horror was just beginning. Four nights later, the pair came home and "were getting ready for bed when Malliaros noticed a weird bustling coming from her window," the suit says. "[T]he curtain covering the window was moving a lot," and when Malliaros went to investigate the sound, "a bat flew out from behind the curtain headed directly at" her, the suit says.

  • "Malliaros screamed, exited the bedroom and slammed the door, leaving her purse, money and cell phone behind." The pair stayed at a relative’s apartment, where they’ve been living in cramped quarters ever since, the suit says. "The plaintiffs have only returned to the premises to pick up some of their personal effects" and "only during daylight hours," the suit says.

  • They did get a painful souvenir from their six-day stay in their new home — their doctor noticed two marks on Katehis which they believe "were caused by a bat while Katehis was asleep in the premises."

  • As a result, they had to go the ER at Lenox Hill for a rabies vaccine. "They were each given four shorts, which were very painful and involved very large needles," and they need "to get an additional shot each week for the next three weeks."

  • The pair say they’d like to move, but "after paying $36,100 up front for the one year lease of the premises, which includes a security deposit and a broker’s fee, the plaintiffs do not have money to find substitute housing." The suit says they complained to the landlord about the bat problem, but he never returned their call.

  • The suit seeks a refund of their rent from August on, as well as $1 million in damages for their "emotional distress," "severe anxiety" and problems they’ve had sleeping since. Landlord Fairline Management did not respond to requests for comment.

  • The building’s super, Sabri Shabiu, told The Post he had taken one bat out of the apartment, but said he felt the women were exaggerating about the extent of the problem. "No infestation. No way!" he said. Other residents said they hadn’t had any bat issues in the building, although there had been problems with skunks and raccoons in the building’s garden.

Source: Bats drove us from our apartment: lawsuit.

Judge To Prosecutor: 'Nice Try, But No Dice' After Rejecting Move To Yank Bail Release For Multiple-Slay Suspect Who Stiffed Bank On Mortgage Payments

In Newark, New Jersey, The Star Ledger reports:

  • Accused killer Lee Anthony Evans remains free on nearly $1 million bail following a Superior Court judge’s determination [] that he can continue to use an Irvington property on which he balanced his bail funds.

  • Evans, 58, faces five murder counts for the Aug. 20, 1978, killings, and was released from jail last summer after posting bail in the form of three pieces of property

  • The Essex County Prosecutor's Office filed a motion earlier this month to revoke Evans' $950,000 bail, saying the lead defendant in the 1978 slaying of five Newark teenage boys violated its terms by defaulting on a five-year commercial loan on the property and failing to pay related property taxes.


  • Judge Patricia Costello, though, found that the property in question, 10-12 Melville Place, is in fact two parcels, and that just one is in default. Together with the two other properties also not in arrears, both owned by relatives, Evans meets the bail’s terms, she said.

For the story, see Man charged with killing five Newark teens in 1978 can remain free on bail, judge rules.

Friday, September 9, 2011

After Some Foot-Dragging, BofA Agrees To Waive Fees, Reimburse Legal Expenses For Elderly Couple Threatened With Foreclosure Over Early House Payment

In New Port Richey, Florida, the St. Petersburg Times reports:

  • Last week, Bank of America apologized for mistakenly foreclosing on an elderly couple because they had made a mortgage payment too early. But that apology didn't include reimbursing the couple for $1,800 in legal fees or waiving late fees caused by the bank's blunder.

  • After supporters of James and Sharon Bullington cried foul, the country's biggest lender decided Thursday to reimburse the legal fees and waive all late fees connected to its error.


For more, see Finally: Bank of America waives fees it charged elderly couple.

Investor Owning 57 Of 112 Apartments In Rapidly-Deteriorating Condo Complex Stiffs HOA Out Of $335K In Dues, Leaving Other Unit Owners Holding The Bag

In Nashville, Tennessee, The Tennessean reports:

  • Residents of a West Nashville condominium complex could soon be forced to search for new homes because of a complicated dispute between absentee real estate investors and their homeowners association.

  • The West Meade Condominium complex, located off Charlotte Pike next to the Nashville West shopping center, has become dangerously rundown because the homeowners association doesn’t have enough money to pay for repairs.

  • A metal staircase to one of the buildings has nearly rusted through. External support beams have completely separated from the roof hanging above. Roofs to at least three of the buildings are crumbling away. During this summer’s record heat, there wasn’t even enough money to open the community pool.

  • But despite a June court ruling saying the homeowners association is owed $335,000 by Landis Ventures, which owns 57 of the 112 condos, residents say they were told at a recent board meeting that it may soon be time to search for a new place to live. Lack of funds could force the association to declare bankruptcy and sell the condo property, according to the summary of a recent board meeting.


  • A summary of the emergency meeting uncovered by The Tennessean showed that the association soon may not have enough funds to pay for its liability insurance or utility bills.

For more, see Dispute could force out residents of rundown condo (Investors owe $335,000 to homeowners association).

Chicago Feds Take Down Dad, Kids With Convictions, Prison Sentences In Ponzi, Phony Home Mortgage Reduction Scams Screwing 2,000 Victims Out OF $10M+

From the Office of the U.S. Attorney (Chicago, Illinois):

  • A Chicago man was sentenced to 15 years in federal prison, after eight-year prison terms were imposed previously for his son and daughter, in connection with a massive "affinity" fraud scheme in which approximately 2,000 victims were swindled of approximately $10.7 million in losses.

  • The father, Roy Fluker, Jr., 56, of Highland Park, who was arrested in Florida where he fled after failing to appear for sentencing last December, received the 15-year term [...] in Federal Court in Chicago.

  • Fluker, his son, Roy Fluker, III, and his daughter, Ronnanita Fluker, were each convicted of multiple fraud counts following a trial in May 2010.(1)


  • All three defendants participated in a scheme between 2005 and 2008 in which they fraudulently obtained approximately $18 million from victims, as well as some victims’ homes, through their operation of companies called All Things in Common, LLC, which did business as More Than Enough, LLC and Locust International, LLC.

  • [In addition to a Ponzi scheme,] Defendants also marketed what purported to be a financial program called the "Housing Program," which they claimed provided a way for people to reduce their mortgage payments and to own their homes clear of any mortgage within five years.

  • The majority of victims were individuals whom Fluker and his children targeted at gatherings in Chicago area churches and hotels. Fluker and his children marketed their programs exclusively to the African-American community.

For the U.S. Attorney press release, see Father Sentenced to 15 Years in Prison, Following Eight-year Terms Imposed on Son and Daughter, for Their Roles in $10 Million Affinity Fraud Scheme That Swindled 2,000 Victims.

(1) Roy Fluker III, 31, was sentenced to eight years in prison, and Ronnanita Fluker, 34, was sentenced to an eight-year prison term last December, according to the press release. A $9 million preliminary forfeiture judgments against all three defendants was imposed and they were ordered to pay $7,336,957 in restitution.

Plot Owners Remain Lingering In Limbo After Cancellation Of Cemetary Foreclosure Sale; Ripoff By Now-Convicted Prior Owner Plays Role In Turmoil

In Calvert County, Maryland, the Maryland Independent reports:

  • The foreclosure auction on the lawn of the Calvert County Circuit Court for Southern Memorial Gardens was canceled [last week] and some upset plot owners could not get answers as to what will happen next.


  • I don’t know the answer to that,” the bank trustee said to several people who asked what will happen to their plots, who now owns the cemetery and if someone dies now can they be buried on their plot. The 50 or so people were varied in dress from business suits to shorts; many of the plot owners say they are in limbo and do not know where to find answers.

  • Eileen Wilson, who said she paid $47,000 for 16 plots, was upset that she could not get answers and was worried that the bank or someone who bought the cemetery would resell her plots. “There’ll be a war down here,” she said, if that happens. “The Office of Cemetery Oversight did not do their job in the first place,” said Wilson, whose husband is buried in the cemetery.


  • Peggy Bekavac of Dunkirk, whose husband is buried at the cemetery and owns a plot next to him, said that she has been so upset. “People are scared to die. A lot of people are worried,” she said. Bekavac said she bought the plots 17 years ago and wants someone to purchase the property so she can be assured that she will be buried next to her husband. "These people just want what they paid for,” she said.

  • The foreclosed cemetery owner Danny Martin, who was at the auction, blamed the OCO for the foreclosure, saying, “They forced us into foreclosure.” Martin said that he had an agreement with the bank to continue to own the cemetery, but the board would not allow him to do so. Martin said they have had a difficult time due to the economy, but have seen a 67 percent increase in revenue over the last year. If the OCO would give Martin back his license, he said that he could work out a deal with the bank.

  • Martin has also had to contend with services that were not rendered but with fees collected by past cemetery owner Larry Deffenbaugh, who was convicted of theft for a case that had more than 550 victims who were defrauded. Deffenbaugh stole about $2 million, but only had to pay the cemetery $1 million, which was court ordered restitution, he said.

  • Martin said he himself now has 35 criminal charges against him assessed by the OCO, and other employees who worked for Southern Memorial Gardens also have charges against them. “We are not authorized to do business. We can’t even cut the grass,” Martin said.

For the story, see Dunkirk cemetery auction canceled.

Convicted Real Estate, Check Scammer Now Faces Charges Of Ripping Off His Sister In Dubious Home Deal, Leaving Her & Kids Facing The Boot

In Peyton, Colorado, KRDO-TV Channel 13 reports:

  • Target 13 Investigates has warned you about him before, and now a former mortgage broker convicted of theft and forgery has been arrested again. Michael Hoskisson is accused of pocketing over $25,000 from his sister who said she thought she was making mortgage payments to him.(1)

  • Kammie Hoskisson-LaRose said she was stunned when she learned her Peyton home was in foreclosure, after she had been making payments to Hoskisson since 2009. "I'm overwhelmed," said LaRose. "I've put everything I have into re-doing the home."

  • LaRose said she had always been close to her older brother and trusted him when he said he could help her own her dream home. LaRose said her credit score wasn't high enough to get her own mortgage, so Hoskisson told her that his mortgage company would buy the home from its owner, then LaRose would make payments to him and eventually apply for her own mortgage.

  • According to Hoskisson's arrest affidavit, both LaRose and the home's owner, Michael Hill, believed Hoskisson had finalized the sale of the home. The Fourth Judicial District Attorney's Office said that never happened, and the last mortgage payment on the house was made by Hill in 2008. Hill's name is on the foreclosure documents.

  • The D.A.'s office said the mortgage payments LaRose thought she was making had gone into her brother's personal bank account. [...] LaRose said she's trying to work something out with the bank, but it's not looking promising.

  • "My name's not on anything, so I really don't have a say," she said. "They could tell me I'll be evicted in 30 days."

For more, see Springs Man Accused Of Stealing 25K From Sister (Woman May Lose Her Home).

(1) According to the report, Hoskisson is due in court for a hearing on September 16, and is facing charges of theft, identity theft and forgery. Reportedly, Hoskisson lost his mortgage broker license after pleading guilty to theft with a real estate transaction in 2009, and in 2011, he was convicted of forging over $73,000 in checks from an at-risk adult he befriended. Hoskisson was sentenced to five years probation and ordered to pay over $92,000 in restitution to the man's family, the story states.

Thursday, September 8, 2011

NYC Man Faces Grand Larceny Charges After Allegedly Pocketing Upfront Rent On Apartment He Didn't Own

From the New York Post NYPD Daily Blotter:

  • An East Village real-estate agent turned out to be one big phony, authorities said. Renato Bardini, 48, showed an apartment seeker a place on East Third Street near First Avenue last month, authorities said.

  • The victim wanted to move in and gave Bardini a $500 security deposit and a $75 “application fee.” The faux agent also showed the apartment to another victim, who gave him more than $3,000 for rent, deposits and fees. It’s not clear how the fraudster accessed the apartment.

  • Bardini was charged with third-degree grand larceny, scheming to defraud and petit larceny.

Source: NYPD Daily Blotter (Manhattan).

Pair Pinched, Accused Of Clipping Homeowners For Upfront Fees In Mortgage Elimination Racket, Then Forging & Recording Phony Lien Satisfactions

In San Bernardino, California, The San Bernardino Sun reports:

  • Two men suspected of scamming homeowners struggling to avoid foreclosure will be arraigned [] in San Bernardino Superior Court on a 45-count criminal complaint. Prosecutors say Stephen Andrew Easterly, 47, and Emanuel Percival, 36, defrauded at least 25 people with their Fontana business and affected more than $17 million in home loans. "Basically, they were getting people to try to redo their loans," Deputy District Attorney Michael Fermin said.

  • The people were on the verge of foreclosure or wanted a lower payment, he said. The alleged victims reportedly paid between $3,500 and $7,000 to participate in a process they believed would pay off their home loans and save them from foreclosure, according to a news release Monday from the San Bernardino County District Attorney's Office. In the end, they would end up with two outstanding home loans and the houses went into foreclosure, prosecutors said.


  • The search warrant was the result of an investigation into fraudulent Substitution of Trustee and Full Reconveyance and Release of Lien documents - which are usually recorded by a bank when a mortgage is paid in full - with the county Recorder's Office.

  • In this case, Easterly and Percival signed documents as "authorized representatives" of various banks, according to prosecutors. Between the pair, more than 70 fraudulent documents are alleged to have been recorded.

  • Prosecutors said Easterly also created fictitious checks, mailed them to banking institutions and told victims he was paying off their loans.

  • Easterly faces 21 counts of forgery and 16 counts of procuring or offering a false or forged document from Oct. 25, 2010, to June 29, according to the criminal complaint. Percival faces four counts each of forgery and procuring or offering a false or forged document between March 23, 2010, and Nov. 24.(1)

For the story, see Two men accused of scamming struggling homeowners.

For the San Bernardino County DA press release, see Pair Arrested For Real Estate Fraud.

(1) According to the story, both men were being held Monday at West Valley Detention Center in Rancho Cucamonga. Bail for Easterly was set at $1 million, and Percival's bail was set at $500,000, prosecutors reportedly said.

Fla. AG, State Bar Begin Probe Into Alleged Rackets Purportedly Peddling Participations In Mass Joinder Suits Offering F'closure, Home Mortgage Relief

The Palm Beach Post reports:

  • The Florida attorney general's office is investigating the use of mass joinder lawsuits marketed to homeowners facing foreclosure, a new practice that got a California lawyer with ties to a prominent Tallahassee lobbyist shut down earlier this month.

  • Homeowners in 17 states, including Florida, received mailers from companies connected to California attorney Philip Kramer telling them they could join in lawsuits against banks for a retainer fee of between $5,000 and $10,000, according to a complaint filed earlier this month by California Attorney General Kamala Harris.(1)


  • Kramer was featured as "of counsel" on the website of the Tallahassee-based Ramba Law Group, which is led by David Ramba. The website also touted the use of mass joinder lawsuits and linked to several of the court filings. Ramba is a lobbyist for Callery-Judge Grove LP and the Loxahatchee Groves Water Control District. Neither Ramba nor his law group is named in the California complaint.

  • Although Ramba previously defended the mass joinder suits, on Monday he said Kramer's firm unlawfully used his name and created the website without his permission. "I have hired an attorney to unwind whatever this guy was doing," Ramba said Monday.

  • He also said he was unaware until last month that offices in Boca Raton and Pinellas Park had been opened with his name on them to speak with homeowners about joining the lawsuits.

  • A person claiming to be an employee in the Pinellas Park office filed a complaint in June with the attorney general's office claiming that homeowners are falsely told a team of attorneys will review their case to see if it qualifies for the mass joinder lawsuit.

  • "No one reviews their information, especially attorneys, and we are instructed to call these people back the next day and tell them attorneys will accept the case but you must pay $5,000 to join," the complaint says. "The whole thing is a scam."

  • The Florida Bar confirmed it has an open investigation into Ramba's involvement with the mass joinder lawsuits and the Florida attorney general's office said it is looking into whether Florida law was violated.

For the story, see Attorney general investigating lawsuits pitched to distressed homeowners.

(1) For the California AG civil lawsuit, see People v. The Law Offices of Kramer and Kaslow, et al.

See also, Cal. AG Tags Alleged Nat'l 'Mass Joinder Lawsuit' Racket With Civil Suit, Shuts Down Operation That Attempts To Circumvent Upfront Fee Bans, Some Say.

Virginia AG Cites Another Loan Modification Outfit For Allegedly Pocketing Illegal Upfront Fees, Failing To Deliver Promised Services

From the Office of the Virginia Attorney General:

  • Attorney General Ken Cuccinelli announced today that he has filed a lawsuit against R.L. Brad Street, LLC, a mortgage loan modification company based in Chesapeake, for allegedly charging illegal advance fees of up to $3,000 before performing "foreclosure rescue" services for its customers.

  • The attorney general alleges that R.L. Brad Street violated the Virginia Foreclosure Rescue Law by charging advance fees in connection with services to avoid or prevent foreclosure. Section 59.1-200.1 of the foreclosure rescue law prohibits a supplier of foreclosure avoidance or prevention services from "charging or receiving a fee prior to the full and complete performance of the services it has agreed to perform, if the transaction does not involve the sale or transfer of residential real property."

  • R.L. Brad Street allegedly collected fees of up to $3,000 in the form of checks made payable to Rhonda Wyland, the company's member/manager, from consumers before performing any services for them.

  • Cuccinelli also alleges that R.L. Brad Street violated the Virginia Consumer Protection Act (VCPA) by failing to deliver on promises to assist consumers in obtaining mortgage loan modifications. The Virginia Consumer Protection Act generally prohibits suppliers from using any deception, fraud, false pretense, false promise, or misrepresentation in connection with a consumer transaction.

For the Virginia AG press release, see Attorney General Cuccinelli sues Chesapeake-based mortgage modification company (Company allegedly charged illegal advance fees for "foreclosure rescue" services).

Wednesday, September 7, 2011

Judge To Developer: Falsely Luring Condo Buyers With Promises Of Panoramic NYC Views Will Cost You $4.8M+

In Jersey City, New Jersey, the New York Post reports:

  • Jamie LeFrak, heir to iconic New York real-estate company The LeFrak Organization, has been ordered to fork over $4.8 million to 16 jilted residents of one of his luxury apartment buildings in Jersey City.

  • The award closes the loop on a ruling from June that found LeFrak falsely lured buyers to his tony Shore Club condominium with promises of panoramic views of Manhattan that were soon obstructed by another LeFrak building, the 32-story AquaBlu.

  • New Jersey state court Judge Edward O’Connor’s order included $3.8 million in damages, plus interest, for the false advertising. Adding insult to injury, the judge also ordered the 38-year-old developer and his firm to cough up close to $1 million in legal fees -- bringing the final tally to close to $5 million.

  • LeFrak has 45 days to appeal. A call to a LeFrak Organization spokeswoman of wasn’t returned.

Source: LeFrak’s view screw costs $4.8M.

Despite Already Receiving Payment On Delinquent Dues, HOA Forces Foreclosure Sale On Homeowner Anyway

In Riverview, Florida, Fox 13 reports:

  • Riverview resident Stephanie Bonefont has been a homeowner for nearly 11 years, but this week she could wind up homeless. The reason why is the tricky part. The single mother is in a twisted legal fight with her homeowners association, South Pointe of Tampa, over unpaid dues. And she says "they're making off like bandits, getting paid twice for this house. Meanwhile, I have to buy it three times."

  • Back in 2008, her home was foreclosed and the title was sold. Here's the problem: Bonefont said she never got any notices. That's because they were mailed to the wrong address. Then one day she got an unexpected knock at her door. "The guy who came to my door, it wasn't in foreclosure at this point, (the house) was in his name," she said.

  • The homeowners association had sold the title to a man named Pasto Angulo for $7,400 - the amount Bonefont owned on fees. She fought it. Because the notices were sent to a wrong address, a judged reversed the sale.

  • And she said she paid Angulo more than $7,300 to get the deed back in her name. But the homeowners association says not so fast. It says it has no evidence that she repaid Angulo. His attorney confirmed the sale to FOX 13 by providing a copy of the check.

  • But since the association never received a payment directly from Bonefont, a judge will allow the home to go up for sale Friday.

  • "They are double dipping, and unfortunately, my research didn't turn up any cases where this has happened before because I don't think its ever happened, " David Jordan, Bonefont's attorney, said.

  • The homeowners association said in a written statement its moving forward with the lawsuit. "The court twice rejected the legal theories advanced by Ms. Bonefont's counsel and confirmed her property should be sold for homeowners association assessments," a portion of it read.

  • It seems Bonefont's only choice to stop the foreclosure is to write another big check, this time to the homeowners association. "How many people has this happened to that are too afraid to fight - that can't fight?" she said.

Source: Woman says homeowners association wrong for selling home.

Lawsuit: Bankster Violated Court Order Staying F'closure Proceedings; Went Forward & Took Title Anyway, Hired Contractor In Attempt To Take Possession

In Pittsburgh, Pennsylvania, the Pittsburgh Post Gazette reports:

  • A Shaler woman filed a lawsuit in U.S. District Court [] alleging that a mortgage firm and its contractors improperly took title to her house, tried to break in and posted a foreclosure notice on her front door while she was holding a party.

  • Pamela A. Vukman sued Beneficial Consumer Discount Co., the law firm of attorney Martha E. Von Rosenstiel and others, saying that actions taken in relation to her home last October violated an order by Allegheny County Common Pleas Court Judge Lee J. Mazur staying foreclosure proceedings against her.

  • Ms. Vukman's attorney, Jeffrey L. Suher, said that she won a court ruling that Beneficial had violated state law when it foreclosed, and the company has appealed that to Superior Court.

  • Despite her victory in the case, Mr. Suher said, the lender took title to her house. It then hired a company to enter her house, remove trash and change the locks. That company's agent was caught trying to break in, the complaint said.

  • Then, a contractor posted a notice of foreclosure on her front door, causing embarrassment. Mr. Suher said that Ms. Vukman is still in the house. Ms. Rosenstiel declined comment. A Beneficial spokesperson could not be reached.

Source: Shaler woman sues over house foreclosure.

Trio To 'Enjoy' Federal Prison Time For Scheme Designed To Steal Home Equity Out From Under Two Unwitting Property Owners

From the Office of the U.S. Attorney (Los Angeles, California):

  • A North Hollywood man was sentenced [] to 15 months in federal prison for his role in a mortgage fraud scheme in which the schemers used stolen identities to “purchase” homes that were not for sale.

  • Venedie Roberto Valencia, 27, who worked at Bank of America at the time of the offense, was sentenced by United States District Court Judge Dale S. Fischer. In addition to the prison term, Judge Fischer ordered Valencia to pay $51,688 in restitution.

  • Previously in this investigation, two of the Valencia’s co-conspirators were convicted and sentenced to prison. Felix Pichardo, 29, of Lancaster, was sentenced to eight years in federal prison in 2009 and Latrice Shaunte Borders, 31, of Long Beach, was sentenced to two years in federal prison in 2010 for their part in the scheme (see December 14, 2009 U.S. Attorney Press Release).

  • According to court documents, Pichardo, a licensed real estate agent, and Borders participated in two separate fraudulent real estate sales transactions. Pichardo, using identities appropriated from other people, caused loan applications to be submitted to AmTrust without the property owner’s knowledge for real estate which was not for sale.

For the U.S. Attorney press release, see Former Bank Employee Sentenced To 15 Months In Federal Prison For Role In Mortgage Fraud Scheme.

Tuesday, September 6, 2011

Unanswered Questions On MERS' Role In Washington State Foreclosures To Be Decided By State High Court; Fed. Judge Referral Shortcuts Drawn Out Process

In Washington State, The Oregonian reports:

  • Washington state's highest court is set to determine whether thousands of pending foreclosures can proceed out of court, potentially averting months of conflicting and murky rulings. The court will hear arguments over whether lenders can file foreclosures in the name of MERS, a private company that owns a computerized mortgage registry system.

  • Big lenders, including Fannie Mae, Freddie Mac and several large U.S. banks, created MERS in 1995 to get around cumbersome laws that required paperwork to be filed with county clerks when a mortgage changed hands.


  • If the court rules against MERS, it could force thousands of foreclosures into court that would otherwise have been handled without ever going before a judge. And any decision could bring some order to a hodgepodge of state and federal rulings in wrongful foreclosure complaints -- at least, in Washington. Elsewhere, including Oregon, similar cases continue their long slog toward Supreme Court resolution, a legislative fix or a different tack by lenders.

  • At issue is whether MERS meets the definition of a beneficiary under Washington law, and therefore whether it can legally file a foreclosure on a lender's behalf. "MERS cannot meet that definition because MERS is never a note holder," said Melissa Huelsman, an attorney representing Kristin Bain, one of the homeowners in the case. "They are simply a name on a piece of paper sitting there for the purposes of record keeping."


  • In Washington, the questions went to the Supreme Court at the order of U.S. District Judge John C. Coughenour.(1) That expedites a case that could have taken years to reach the Supreme Court, Huelsman said. "This is absolutely a shortcut to get it there," she said.

For more, see Washington Supreme Court to weigh legality of MERS foreclosures.

(1) See Bain v. OneWest Bank, Case No. C09-0149-JCC (W.D. Wash. March 15, 2011) for Judge Coughenour's order deferring on ruling on this issue of state substantive law until the Washington State Supreme Court decides the issue.

In refusing get sucked into the foreclosure fraud muck and add to the nationwide confusion as to whether MERS can or can't 'soil' foreclosure proceedings with its involvement, Judge Coughenour made these comments in deciding to defer to the Supreme Court of Washington (the court most qualified to decide questions of state substantive law in Washington state) until it rules as to whether MERS has any business playing a role in foreclosures under the law of the state of Washington (bold text is my emphasis; [alteration added] to adjust an apparent judicial/administrative oversight in transcribing the text):

  • This Court does [not] need to add even more pages to the legal discourse discussing whether MERS may serve as a beneficiary in deeds of trust generally. Compare, e.g., Silvas v. GMAC Mortg., LLC, No. CV-09-265-PHX-GMS, 2009 WL 4573234 (D. Ariz. 2009) (favoring MERS); Pantoja v. Countrywide Home Loans, Inc., 640 F. Supp. 2d 1177, 1188-89 (N.D. Cal. 2009) (favoring MERS), with, e.g., Mortg. Elec. Registration Sys., Inc. v. Sw. Homes of Ark., 301 S.W.3d 1 (Ark. 2009) (favoring borrower); In re Agard, No. 810-77338-reg (E.D.N.Y. Bankr. Feb. 10, 2011) (favoring borrower). See also Christopher L. Peterson, Foreclosure, Subprime Mortgage Lending, and the Mortgage Electronic Registration System, 78 U. Cin. L. Rev. 1359 (2010).

    Nor will the Court discern, more narrowly, whether MERS may serve as a beneficiary under Washington's Deed of Trust Act. That answer remains patently unclear. See Certification Order, Vinluan v. Fidelity National Title & Escrow Co., No. 10-2-27688-2 SEA (King Cnty. Superior Ct. Jan. 18, 2011). Because a state circuit court has recently certified this very question to the Washington Supreme Court, this Court declines to decide the issue before the Washington Supreme Court evaluates it.


  • Plaintiff admits that she has been delinquent in her mortgage payments. A ruling favorable to Plaintiff in this case and others like it cannot and should not create a windfall for all homeowners to avoid upholding their end of the mortgage bargain—paying for their homes. But a homeowner's failure to make payments cannot grant lenders, trustees, and so-called beneficiaries like MERS license to ignore state law and foreclose using any means necessary. Whether these and similar defendants complied with Washington state law remains unclear.


  • The Court STAYS this action pending the Washington Supreme Court's decision in Vinluan v. Fidelity National Title & Escrow Co., No. 10-2-27688-2 SEA. Counsel for the parties shall notify the Court when the Washington Supreme Court decides whether to accept certification and, if so, when it renders an opinion.


Note: Judge Coughenour deserves to be commended for:

  • making it clear that a homeowner's mere failure to make house payments does not "grant" the banksters "license" to trample over the rule of law when carrying out foreclosure proceedings (a point that seems to fall outside the intellectual grasp of the banksters, and their enablers and apologists),

  • taking this position, notwithstanding any personal feelings he may have against attempts by homeowners to score, as he put it, "a windfall" by dodging their responsibility for paying for what they bought (regrettably, many trial judges find great difficulty in setting aside their personal feelings in this regard while seemingly ignoring the fraudulent conduct by the banksters and their foreclosure mill conspirators - a point evidenced by the growing number of lower court rulings being challenged and reversed on appeal).

50-State AG Foreclosure Fraud Probe Chief: Our Settlement Won't Release Banksters From 'All' Civil Liability Or 'Any' Criminal Liability

Bloomberg reports:

  • The 50-state attorney general group investigating mortgage foreclosure practices won’t release banks from all civil, or any criminal, liability in a settlement, Iowa Attorney General Tom Miller said.

  • Miller said criticism of the multistate case was based on the “false notion” that its organizers were prepared to release the banks from all liability, including criminal liability. New York Attorney General Eric Schneiderman has been portrayed as resisting that position, Miller wrote in a letter to New York lawmakers who complained about Schneiderman’s removal from an executive committee working on the agreement.

For more, see Iowa Says State AG Accord Won’t Release Banks From Liability.

Federal Reserve, NYS Bank Regulator Announce Robosigner Settlements With Goldman, Loan Servicers

The Wall Street Journal reports:

  • The Federal Reserve announced an enforcement action against Goldman Sachs Group Inc., saying the company's mortgage-servicing unit had engaged in "a pattern of misconduct and negligence" in its handling of home-mortgage loans.

  • The Fed's action on Thursday seeks changes in mortgage-servicing practices and unspecified monetary damages. It came as Goldman reached an agreement with New York state banking regulators over wrongful foreclosures,(1) allowing it to complete the Sept. 1 sale of its Litton Loan Servicing unit to Ocwen Financial Corp. A spokesman for Goldman Sachs declined to comment.

  • The Fed action is the latest response by government officials investigating mortgage-servicing irregularities including "robo-signing," in which bank employees signed foreclosure documents without reviewing case files as required by law. Federal and state officials continue to pursue a settlement with the nation's largest mortgage companies over allegations they mishandled home loans.

For more, see Fed Hits Goldman With Mortgage Order (may require paid subscription; if no subscription, GO HERE; or TRY HERE - then click the appropriate link).

(1) See Superintendent Lawsky Announces Agreement with Goldman Sachs, Ocwen, Litton on Groundbreaking New Mortgage Practices (Sale of Goldman’s Subsidiary, Litton, Conditioned on New Servicing Practices; Goldman to Significantly Reduce Loan Amounts for Those Hit by Financial Crisis).

AP Report: Banksters' Dubious Docs Dating Back To 1990s Threaten Land Recording System Across U.S.; Title To Tens Of Thousands Of Properties Infected?

The Associated Press reports:

  • Counties across the United States are discovering that illegal or questionable mortgage paperwork is far more widespread than thought, tainting the deeds of tens of thousands of homes dating to the late 1990s. The suspect documents could create legal trouble for homeowners for years.(1)

  • Already, mortgage papers are being invalidated by courts, insurers are hesitant to write policies, and judges are blocking banks from foreclosing on homes. The findings by various county registers of deeds have also hindered a settlement between the 50 state attorneys general who are investigating big banks and other mortgage lenders over controversial mortgage practices.


  • But now, as county officials review years' worth of mortgage paperwork, in some cases combing through one page at a time, they are finding suspect signatures — either signed with the same name by dozens of different people, improperly notarized or signed without a review of the facts in the paperwork — on all sorts of mortgage documents, dating as far back as 1998, The Associated Press has found.

  • "Because of these bad titles, property owners can't prove they own the properties they think they bought, and banks can't prove they had the right to sell them," says Jeff Thigpen, the registrar of deeds in Guilford County, N.C. In Guilford County, where Greensboro is located, a sample of 6,100 mortgage documents filed since 2006 turned up 74 percent with questionable signatures.


  • Widespread robo-signing that stretches back a decade or more could create problems for homeowners. Regulators have so far not asked lenders to clean up the potentially millions of suspect documents filed in the past decade or earlier. That troubles some banking experts, including Sheila Bair, who until early July was chairwoman of the Federal Deposit Insurance Corp.

  • "We do not yet really know the full extent of the problem," Bair said in written remarks to the Senate Banking Committee. She and others have called for a comprehensive study on the extent of the fraudulent signatures in mortgage documents.

  • If documents with robo-signed signatures are challenged in court, judges could question the ownership of the properties, says Katherine Porter, a professor at University of California Irvine School of Law and an expert on consumer credit law. The consequences extend to homeowners in good standing when they try to sell.

  • If invalid documents are discovered in the chain of ownership, it could delay the sale or make it difficult for buyers to get a mortgage because title insurers won't write a policy for the property, says Justin Ailes, vice president of government affairs of the American Land Title Association, a trade association representing the title insurance industry. Banks and other mortgage lenders won't write a home loan without title insurance.


  • "The banks are playing with the integrity of the land record system," says John O'Brien, the recorder of deeds from Salem, Mass. [...] O'Brien, the recorder of deeds from Massachusetts, says he's only responsible for one county out of more than 3,000 in the U.S. "Federal regulators with a lot more authority than me have to step up to the plate and help correct this," he says.(2)

For more, see Robo-signed mortgage docs date back to late 1990s (if link expires, TRY HERE).

(1) For additional background on the 'chain of title' problem arising by reason of robosigning, see:

(2) See Home Preservation Network: John O'Brien Calls On CEOs and AGs to Come to Salem:

  • John O’Brien, Southern Essex County Register in Salem, Massachusetts has been leading the national effort to hold lenders accountable, and has refused to record robo-signed documents has invited the CEO’s of the nation’s largest banks and all of the state’s attorneys generals to come to the Salem Registry and view first-hand the damage that has been caused to thousands of Essex County homeowners’ chains of title.

  • It's like a tornado came through here,” said Register John O'Brien, referring to the financial havoc and damage done to property records at the Registry of Deeds. “Following any disaster, the powers that be generally show up to assess the damage. That is what I would like these major lenders and the Attorneys General to do – sooner than later,” O’Brien said.

Deed Recording Head Invites Banksters, State AGs To Survey Robosigner-Induced Wreckage To Local Land Records; "It's Like A Tornado Came Through Here!"

The Home Preservation Network reports:

  • John O’Brien, Southern Essex County Register in Salem, Massachusetts has been leading the national effort to hold lenders accountable, and has refused to record robo-signed documents has invited the CEO’s of the nation’s largest banks and all of the state’s attorneys generals to come to the Salem Registry and view first-hand the damage that has been caused to thousands of Essex County homeowners’ chains of title.(1)

  • It's like a tornado came through here,” said Register John O'Brien, referring to the financial havoc and damage done to property records at the Registry of Deeds. “Following any disaster, the powers that be generally show up to assess the damage. That is what I would like these major lenders and the Attorneys General to do – sooner than later,” O’Brien said.

  • O’Brien believes that a sweetheart deal, in the form of a settlement to grant lenders immunity from prosecution, is in the works.

For more, see John O'Brien Calls On CEOs and AGs to Come to Salem.

(1) For additional background on the 'chain of title' problem arising by reason of rob0signing, see:

Media Coverage Raises The Heat On Foreclosure Probe, Shining Light On Evidence Of Continuing Sloppy, Fraudulent Bankster Practices

From the Columbia Journalism Review's The Audit blog:

  • It’s clear that the banks aren’t much chastened by the foreclosure scandal that erupted last fall and which threatens to cost them tens of billions of dollars.

  • An American Banker investigation [] shows shows that several banks are still fraudulently backdating documents to foreclose on homeowners.(1) And it’s not the first to show this. Last month, an outstanding Reuters probe by Scot Paltrow showed similar behavior [...].(2)

  • These stories raise serious questions for the Obama administration and states attorneys general led by Iowa’s Tom Miller who have been rushing to settle and release the banks from liability for fraud. How can you release folks who’ve repeatedly shown that they’ll ignore the law and even recent settlements promising they’ll obey it?

For more, see The Foreclosure Scandal Continues (American Banker and Reuters show banks thumbing their nose at the law).

(1) American Banker: Robo-Signing Redux: Servicers Still Fabricating Foreclosure Documents:

  • Some of the largest mortgage servicers are still fabricating documents that should have been signed years ago and submitting them as evidence to foreclose on homeowners.

(2) Reuters: Special report: Banks still robo-signing.

See also:

Monday, September 5, 2011

Federal Regulator Suit: Banksters Made False Claims Regarding Compliance w/ Sound Underwriting Guidelines When Making, Peddling Securitized Home Loans

Reuters reports:

  • A U.S. regulator sued a number of major banks on Friday over losses on more than $41 billion in subprime mortgage bonds, which may hamper a broader government mortgage settlement with banks.

  • The lawsuits by the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, came as a surprise to the market and weighed on bank shares. The lawsuits could add billions of dollars to the banks' potential costs at perhaps the worst possible time for the industry.

  • The FHFA accused major banks, including Bank of America Corp, its Merrill Lynch unit, Barclays Plc, Citigroup Inc and Nomura Holdings Inc of selling bonds backed by mortgages that should have never been packaged into securities.


  • While the ultimate amount FHFA will seek is still unclear, [an unnamed mole reportedly familiar with the matter] said it could top the $20 billion being discussed by the banks and the state attorneys general.

  • "Defendants falsely represented that the underlying mortgage loans complied with certain underwriting standards and guidelines, including representations that significantly overstated the ability of the borrowers to repay their mortgage loans. These representations were material to the GSEs, as reasonable investors, and their falsity violates (the law) and constitutes negligent misrepresentation, common law fraud, and aiding and abetting fraud," the FHFA said in the suit against Merrill Lynch.

For more, see U.S. regulator sues major banks over mortgages.

See also, The New York Times: U.S. Is Set to Sue a Dozen Big Banks Over Mortgages:

  • The Federal Housing Finance Agency suits, which are expected to be filed in the coming days in federal court, are aimed at Bank of America, JPMorgan Chase, Goldman Sachs and Deutsche Bank, among others, according to three individuals briefed on the matter.

Accused Home Title-Snatcher Faces Charges Of Forgery, Obtaining Property By False Pretenses, Breaking & Entering For Hijacking Vacant F'closed Mansion

In Raleigh, North Carolina, the News Observer reports:

  • Police have arrested and charged a Tarboro man with squatting for at least seven months in a North Raleigh home valued at nearly $2 million.

  • The 7,664-square-foot home in Wakefield Plantation has six bedrooms, six full bathrooms, theater and game rooms, a wine cellar, vaulted ceilings and an elevator. There is also a swimming pool and a Jacuzzi whirlpool bath.

  • Thomas Everette Jr., 31, apparently enjoyed the [...] luxury home so much that he created a fake company with forged documents to transfer the property to himself at no cost, according to police reports.

  • But the scam fell apart when a concerned neighbor did some investigating and called police.


  • Everette is charged with one felony count each of breaking and entering, obtaining property by false pretenses and forgery of deeds or wills, according to arrest warrants filed at the Wake County Magistrate's Office.

  • His arrest came about two weeks after state Attorney General Roy Cooper announced that a group of Triangle residents had filed bogus paperwork at the county's Register of Deeds office to try to claim ownership of six foreclosed homes in Wake County.(1)

  • Anne Redd, a spokeswoman with the Wake County Register of Deeds, said she was contacted by the state Attorney General's Office before Everette's arrest. "They told me they were fixing to get him because he had been living there since December," she said.

  • The neighbor, who called the 911 operator last week, said he had called earlier in February about people going into the house because he thought it was a burglary. Everette avoided arrest, however, by showing paperwork that claimed he was trustee of the property to the police officer who responded, the neighbor said.

  • The house is actually owned by the New York Bank of Mellon and Bank of America after it went into foreclosure last year, according to Wake County real estate records.


  • Investigators say Everette set up a fictitious company, International Fidelity Trust, and filed it with the Secretary of State's Office on April 20. He then created a false deed that listed International Fidelity Trust as the owner of the Victoria Park Lane house, state records show.

  • Next, he filed paperwork giving the home's "occupants" 90 days to satisfy all financial obligations or waive their right to the home. The home was vacant, so there was no one to respond to the bogus claim to the home, county records show.

  • Everette filed another document with the Register of Deeds on July 13, showing that International Fidelity Trust had transferred the home to him at no cost, court records show. On that document, police say Everette forged signatures of a Bank of America official and a South Carolina notary public to gain control of the $1,941,949 property for which he never paid a dime.


  • Everette apparently is not a novice at running scams. He has a 28-page record of previous charges that include breaking and entering, trespassing, violation of a domestic violence order, impersonating a bail bondsman, identity theft, larceny, resisting arrest, obtaining property by false pretense and insurance fraud, state records show. He is being held at the Wake County jail, his bail set at $85,000, a jail spokeswoman said Tuesday.

For the story, see Man accused of being a squatter in N. Raleigh.

(1) See Criminal, Civil Charges Brought In Vacant Home Hijacking Scam; NC AG: Phony Deeds, Bogus Liens "Filled With Gibberish ... A Fraud On The Whole System".

Nevada AG Expands Pending BofA Suit To Include Dubious Lending, Foreclosure Practices; Joins NY AG In Upping Heat On Notorious Bankster

Paul Kiel at ProPublica reports:

  • The state of Nevada dramatically expanded its lawsuit against Bank of America today, turning the narrow case it filed late last year into a broadside that targets virtually all aspects of the bank's mortgage operations. Bank of America has previously denied wrongdoing.

  • The sweeping new suit could have repercussions far beyond Nevada's borders. It further jeopardizes a possible nationwide settlement with the five largest U.S. banks over their foreclosure practices, especially given concerns voiced by other attorneys general, New York's foremost among them. (You can read the suit here).


  • According to the suit, borrowers were duped into unaffordable loans and then victimized again through a misleading mortgage modification program that homeowners tried to use to avoid foreclosure. Finally, the suit alleges, the bank filed fraudulent documents to move forward with the foreclosures.


  • The state's suit had previously been confined to the modification issue. At that time, Bank of America also said homeowners would be best served not through litigation but through reaching a multistate settlement that would "broaden programs for homeowners who need assistance."

  • By expanding the suit, Nevada's Catherine Cortez Masto joins New York Attorney General Eric Schneiderman in stepping up investigations of the bank. In addition to initiating a broad investigation of banks' securitization practices, he recently filed a suit charging that Bank of America had fraudulently foreclosed on homeowners.

For more, see Nevada Wallops Bank of America With Sweeping Suit; Nationwide Foreclosure Settlement in Peril.

Go here for links to other articles by Paul Kiel on the rackets involving bank foreclosures and loan modifications.

Two Notorious Players In Nationwide Foreclosure Robosigning 'Phenomenon' Receive Appeals Court Recognition For Their 'Contributions' To The Effort

A recent federal appeals ruling from the 3rd Circuit Court of Appeals reinstating a bankruptcy judge's hammering of a foreclosure mill for its use of robosigned documents.(1)

While not directly involved in the litigation of the appeal, two notorious players in the foreclosure robosigning 'phenomenon' that's swept the nation nevertheless received recognition by the court for their apparently 'less-than-meritorious' contibutions to this once fast-growing industry.

Although the court 'buried' the recognition of these 'fine' outfits in two footnotes, the court's observations with regard to this pair arguably deserve some highlighting here.

In footnote 2 of the ruling, the court gives a foreclosure mill law firm its due (alterations in the original):

  • Moss Codilis is not involved in the present appeal. However, it is worth noting that the firm has come under serious judicial criticism for its lax practices in bankruptcy proceedings. "In total, [the court knows] of 23 instances in which [Moss Codilis] has violated [court rules] in this District alone." In re Greco, 405 B.R. 393, 394 (Bankr. S.D. Fla. 2009)(2); see also In re Waring, 401 B.R. 906 (Bankr. N.D. Ohio 2009).

In footnote 5 of the ruling, a notorious foreclosure document sweatshop gets its due:

  • LPS is also not involved in the present appeal, as the bankruptcy court found that it had not engaged in wrongdoing in this case. However, both the accuracy of its data and the ethics of its practices have been repeatedly called into question elsewhere. See, e.g., In re Wilson, 2011 WL 1337240 at *9 (Bankr. E.D.La. Apr. 7, 2011) (imposing sanctions after finding that LPS had issued "sham" affidavits and perpetrated fraud on the court); In re Thorne [and try here for more on In re: Thorne], 2011 WL 2470114 (Bankr. N.D. Miss. June 16, 2011); In re Doble, 2011 WL 1465559 (Bankr. S.D. Cal. Apr. 14, 2011).

For the court ruling, see In Re Taylor, No. 10-2154 (3d Cir. August 24, 2011).

(1) See Federal Appeals Court Reinstates Reversed Ruling Hammering Foreclosure Mill For Littering Courtroom With Robosigned Docs; Bankruptcy Judge Vindicated.

(2) See In re Greco, footnote 1, where U.S. Bankruptcy Judge John K. Olson lists the following nine cases filed in the Southern District of Florida which he ties to Moss Codilis 'handiwork:'

  • (1) In re Kearse, 07-21486-BKC-JKO; (2) In re Nicholson, 08-11474-BKC-JKO; (3) In re Greco, 08-13051-BKC-JKO; (4) In re Kassar, 08-13077-JKO; (5) In re Morton, 08-18853-BKC-JKO; (6) In re Studer, 08-19300-BKC-JKO; (7) In re Buhagiar, 08-19610-BKC-JKO; (8) In re Vargas, 08-20302-BKC-JKO; and (9) In re Imburgia, 08-17153-BKC-JKO.

In footnote 2 of the same case, Judge Olson lists the following additional fourteen cases filed in the Southern District of Florida which he connects to Moss Codilis:

  • (1) In re Cecil, 08-10925-BKC-RBR; (2) In re Bertke, 08-16351-BKC-RBR; (3) In re Woods, 08-11231-BKC-PGH; (4) In re Salandy, 08-12866-BKC-PGH; (5) In re Lissandrello, 08-13372-BKC-PGH; (6) In re Biggers, 08-13780-BKC-PGH; (7) In re Colon, 08-14903-BKC-PGH; (8) In re Noble, 08-15675-BKC-PGH; (9) In re Sao, 08-16549-BKC-PGH; (10) In re Shank, 08-18596-BKC-PGH; (11) In re Vega, 08-16381-BKC-AJC; (12) In re Espinoza, 08-21253-BKC-AJC; (13) In re Hargis, 08-21366-BKC-EPK; and (14) In re Brown, 08-23103-BKC-EPK.

'Biggest Case In Ohio F'closure Law In A Century' Takes Unusual Turn; Homeowner's Mtg. Debt Mysteriously Disappears; Banksters, Lawyers: 'No Comment!'

In Cleveland, Ohio, Ohio Public Radio reports:

  • The Ohio Supreme Court is getting ready to take on what some are calling the biggest issue in state foreclosure law in a century. The question before the justices is what paperwork does a lender need to force an owner out of his home? For Ohio Public Radio, WCPN’s Mhari Saito reports that what the state's justices decide could have huge implications for the financial services industry.

  • Antoine Duvall and his wife and young son waited until after Christmas to move into their freshly renovated two-story house in Cleveland’s Collinwood neighborhood. It was 2006 and Duvall, a salesperson for a legal document services company, had just happily signed a mortgage and a promissory note to get his loan from Wells Fargo. But soon, he started to get letters about his loan.


  • The Duvall case seemed like a good one for the state Supreme Court to rule on to settle the issue but it has taken an unusual twist. You might even call it another bank snafu. The homeowner, Duvall, now owes nothing on his mortgage because - in an action unrelated to the Supreme Court case - the loan servicer cleared his debt completely in June.

  • Duvall doesn’t know why it happened and neither his loan servicer nor US Bank’s attorneys are commenting. It’s not clear what the state Supreme Court will do, but attorneys for both sides say the legal question is not going away. The court could still take up the Duvall case or it could address several other cases on the same issue, waiting in the wings.(1)

For more, see Who owns the deed? (The Ohio Supreme Court is taking up the question of what a bank needs to prove to force someone from his home).

(1) The use of '11th hour' legal maneuvers to dodge a potentially adverse court ruling in the foreclosure context by the sleazy banksters is not unheard of. In a recent Florida foreclosure case involving the use of dubious documents to obtain a foreclosure judgment, the banksters and their foreclosure mill avoided having the Florida Supreme Court hear an appeal of a case by reaching a settlement with the screwed over homeowner shortly before the case was presented to the Florida high court (keep in mind that this was a case the banksters had won decisively at the intermediate appeals level). See:

Sunday, September 4, 2011

Negotiations To Keep Brooklyn Great Grandma In Home Of 40+ Years Stall; Activists Plan On Another Protest

In Bedford Stuyvesant, Brooklyn, Bed Stuy Patch reports:

  • Negotiations faltered again last Wednesday for Ms. Mary Ward, the Brooklyn great-grandmother whose home was sold following a predatory lending scheme. After an eviction blockade the prior Friday, August 19, organized by non-profit housing advocates and local residents, supporters were able to postpone the eviction of Ms. Ward by city marshals.

  • The successful blockade ended with Assembly member Annette Robinson volunteering to mediate a meeting on behalf of Ms. Ward and the property’s new owner, Shameem Chowdhury, set for last Monday, August 22. Lawyers for Ms. Ward submitted to Chowdhury a formal offer of $70,000—money Ms. Ward had in escrow. Additionally, Chowdury could donate the property to a land trust as a tax write off.

  • However, Chowdhury has been unresponsive. After he no-showed for the Monday meeting, and the second meeting rescheduled for that Wednesday, August 24, lawyers for Ms. Ward have started preparing a contingency plan in the likely event that the property’s new owner refuses to negotiate.


For more, see Still no Deal for 82-Yr-Old Great Grandma; Another Protest Planned (After a second no-show by the property's owner, organizers plan another protest and march).

HOA Denies Winning Bidder Title To Co-Op Unit Bought At F'closure Sale; NYS Appeals Court: Sale Subject To Association's Governing Docs, Restrictions

In New York City, Habitat Magazine reports:

  • Congratulations! You're the successful bidder at a foreclosure sale of co-op shares. But wait! Can you actually take ownership of the apartment — or do you still need permission from the co-op board? Does a co-op's governing documents trump long-established precepts of property ownership? The answer may surprise you.

  • The 2010 case that set the precedent on this was LI Equity Network LLC v. Village in the Woods Owners Corp.


  • After their eviction [for failure to pay co-op maintenance fees], [the unit owners] defaulted on their loan. The lender declared the loan in default and scheduled a public auction — in this case, a "nonjudicial" sale. LI Equity was the successful bidder — but then the co-op's board of directors said that it would not approve the transfer of shares to.

  • While LI Equity never filed a formal application with the board to obtain the shares, the board independently reviewed and rejected the company's proposal to close on the unit and then, well, sell it to a board-approved purchaser. What's the problem?

  • LI Equity, naturally, sued the co-op in May 2007 on the ground that the company was statutorily entitled to own the apartment, regardless of the terms of the co-op's governing documents.

  • It also sought damages for breach of the implied duty of fair dealing. And the company won in a lower court, which directed that the co-op transfer the shares to LI Equity. The court reasoned that the co-op board did not have the power to interfere with the transfer of the lease and shares from a "judicial" sale, so the same would hold true of "nonjudicial" sale.

  • The appellate court, however, reversed that decision.

    What, My Money's No Good?

  • That court found that LI Equity was subject to the approval requirements found in the co-op's governing documents. It further said that the co-op board properly exercised its business judgment when it applied the approval requirements to the LI Equity's request to close on the shares.

For more, see Who Owns a Co-op Apartment When You Win a Foreclosure? Maybe Not You.

For the ruling, see LI Equity Network LLC v. Village in the Woods Owners Corp., 910 N.Y.S.2d 97, 79 A.D.3d 26 (App. Div. 2nd Dept., 2010).

Cops: Scam Used Title Searches To Find 'High-Equity' Homes For Rent, Tenant 'Posers,' I.D. Theft To Rip Off Landlords' Equity In Rental Homes

In Southern California, The Orange County Record reports:

  • Authorities have arrested seven people, including some in the United States illegally, on suspicion of posing as owners of at least 20 homes they were renting, taking out $5.9 million in home-equity loans and pocketing the cash.

  • The suspects,(1) some of whom are Korean and Chinese nationals, reportedly stole the homeowners’ identities to conduct the transactions, authorities said. One of the suspects is believed to be a resident of Garden Grove, Los Angeles County Sheriff’s Detective Christopher Derry said.

  • Two of the targeted homes were in Orange County: a five-bedroom house on Spartan Street in Mission Viejo and a four-bedroom house on Threewoods Lane in Fullerton, he said.

  • A loan for $200,000 was taken out on the Mission Viejo home and one for $250,000 was taken out on the Fullerton home, Derry said. The rest of the homes are in Los Angeles and San Bernardino counties. Individual law enforcement agencies had been working on their respective cases for a while and had recently begun cooperating, Derry said.


  • Derry said the case was especially hard to crack because the suspects used prepaid cell phones and web-based email addresses, the homes were spread across several law enforcement jurisdictions, and the homeowners learned of the fraud months after the loan transactions, when lenders started the foreclosure process.


  • In a scheme that lasted at least two years, Derry said, the suspects used title searches to find homes for rent that had small or no mortgages on them. Using fake identities and documents, they signed leases and paid security deposits and first month’s rent to gain access to the homes.

  • Then, using “really good” fake IDs, Derry said, the suspects took on the homeowners’ identities, applied for home-equity loans and ordered appraisals. They typically sought loans from “hard-money” lenders who lend for shorter periods and at higher interest rates than commercial financial institutions. Hard-money lenders base funding decisions on property value, equity and salability rather than creditworthiness and income of a borrower.

  • When the loans were funded, escrow companies were directed to transfer the money into several bank accounts opened by the suspects in the real homeowners’ names. From there the money was withdrawn in small amounts as cash or checks.


  • Title companies – which insured the mortgage liens against invalidity or unenforceability – have been paying out millions of dollars to reimburse the lenders for their losses, and homeowners are spending thousands of dollars in court to clear their homes’ titles, Derry said.

For the story, see Police: Renters pose as owners, steal home-equity cash.

(1) According to the story, Federal magistrate John E. McDermott has ordered all seven suspects held without bail. According to McDermott’s order, the suspects are considered flight risks because:

  • Joon Hwan Kim, 24, is a Korean national with no legal status. Kim declined to be interviewed by pretrial services staff.
  • Guang Chen Jin, 37, is a Chinese national and has been unemployed for eight months.
  • Hyung Kyu Lim, 48, is in the U.S. illegally. His mother and four siblings live in Korea.
  • Suhua Lin, 54, is a Chinese national, has recently traveled to China and has family there.
  • Kyounghoon Kim was using multiple identities at the time of arrest, unknown bail resources, family ties to Korea and immigration status issues.
  • Andrew Byun Yoo, 56, has been unemployed for 10 years, has no relevant bail resources and has lived in four other states.
  • Ju Young Chung, 36, has a prior failure to appear and an outstanding warrant.

Double-Talking Judge To Foreclosure Mill: "Lying Is Unacceptable!" But Then OKs Use Of False Affidavits Anyway, Proceeds To Ratify Forced Sale Of Home

In Baltimore, Maryland, The Daily Record reports:

  • Lawyers at Shapiro & Burson LLP repeatedly lied by signing each other's names to foreclosure affidavits, but their actions did not alter the rights of the lender or the homeowners, a Baltimore County judge has ruled.

  • Circuit Court Judge Susan Souder wrote in her Aug. 11 opinion that she did not believe monetary sanctions were appropriate, and that she would leave any punishment levied against the plaintiffs -- all lawyers -- to bar counsel at the Attorney Grievance Commission.

  • Souder dismissed an order requiring the plaintiffs to show cause why the case should not be dismissed and why they should not be sanctioned and ratified the sale of the home.

  • Anthony DePastina, director of litigation for Civil Justice Inc., a Maryland-based public interest legal association, said he understands that these homeowners and others in the foreclosure process have not paid their mortgages and that if another attorney had signed the documents correctly, the whole process would be "copacetic," but, he said, that's not what happened here.

  • "The reality is we're lawyers. We're supposed to play by the rules and know what the rules are," said DePastina, who is not involved in this case. "When we don't, we compromise the integrity of the entire game. And it's not a game."

  • Souder said she could not comment on the case or whether it was the first decision in the county regarding signatures on foreclosure affidavits, many of which have been questioned with show-cause orders.


  • Souder wrote that the "most disturbing" revelation in this case (John S. Burson, et al. v. Grosso) was that Murphy falsely signed Yoder's name to affidavits regarding military status for Frank and Patricia Grosso, the notice of intent to foreclose and the appointment of substitution of trustees.

  • She found it "very disturbing" that the plaintiffs argued that their lies were proper under Maryland rules. "No case, no statute, and no rule cited by Plaintiffs supports the argument that it is proper for a person to sign another person's name to an Affidavit. That Plaintiffs are attorneys who concluded that such lies are 'entirely proper' is astounding .... It is a lie. And lying is unacceptable," she wrote.

  • Despite her shock at the lawyers' behavior, Souder agreed with the plaintiffs that the false affidavits "did not alter the rights of the parties."

For more, see Home sale ratified despite faulty affidavits (requires paid subscription; if no subscription, GO HERE).

More Observations On Proposed 50-State AG Foreclosure Fraud Settlement, The Booting Of NY AG From Probe Committee & The Buying Off Of Tom Miller

From a recent column in The Huffington Post:

  • John O'Brien, Registry of Deeds for Southern Essex County in Massachusetts is asking that Tom Miller, Iowa Attorney General, step down. Miller is the lead AG in the controversial settlement with the big banks on mortgage servicing fraud.

  • In his most recent obscene act Miller kicked Attorney General Eric Schneiderman off of the 50-state task force probing foreclosure abuses and negotiating a possible settlement agreement with the mortgage firms.


  • Schneidernan getting kicked off the committee should come as no surprise to anyone following the foreclosure negotiations and is sickeningly similar to Pam Bondi, Florida's Attorney General firing Theresa Edwards and June Clarkson, who were heading up investigations on a series of mortgage related crimes for over a year. While Bondi insists that the firings were a result of poor job performance, Miller points more towards attitude and that Schneiderman is somehow not a team player.


  • Schneiderman's removal will likely make it easier for state and federal officials to reach an accord with the five banks. However, the potential amount of money they'll be able to extract will likely decrease. American Banker posted the 27 term sheet of the negotiations presented to the banks with major servicing operations by the AGs and Federal Banking Regulators.

  • The deal completely handcuffs state attorneys general whose constituents are suffering serious economic damage as a result of the foreclosure fiasco and fraud by the banks and servicers.

  • When the investigation into robo-signing and fraud, Tom Miller had a brief moment of righteous advocacy until he received $261,445 in campaign contributions from out-of-state law firms and donors from the finance, insurance, and real estate sector shortly after he announced he was seeking criminal charges and retribution from the banks for mortgage fraud -- that's 88 times what he has received in the past decade.

For more, see John O'Brien MA Registry of Deeds: AG Tom Miller Should Step Down.