Michigan Man Cops Plea In Alleged Home Theft From Elderly Couple

In Wayne County, Michigan the Detroit Free Press reports:

• A Grosse Pointe Woods man accused of defrauding an elderly couple in a real estate scheme pleaded no contest in Wayne County Circuit Court on Wednesday. [...] According to the Wayne County Prosecutor's Office, in February 2004, [John] Matouk, who owned half a property [...] in Dearborn with the couple, forged a quitclaim deed from the couple that transferred the entire property to his company, LM Investments of Dearborn LLC.

• Matouk then allegedly obtained a $650,000 mortgage on behalf of LM Investments and spent the money on himself. In September 2007, the couple discovered the scheme and reported it to authorities.

Source: Man takes plea in real estate case.

For earlier story on this case, see Man charged in Dearborn land swindle case.

Go here, go here, go here, and go here for other posts related to deed theft by forgery, swindle, etc. DeedTheftAlpha

Forgery Charged In Case Involving 94 Year Old Woman Allegedly Cheated Out Of Home By Son, Daughter-In-Law, Lawyer

The Belfast Telegraph reports:

• A Northern Ireland solicitor has denied involvement in a £100,000 fraud in which a 94-year-old woman was allegedly cheated out of her home by her son and daughter-in-law. Co Down solicitor Ann Ervine is accused of falsely claiming to have witnessed pensioner Annie Martin sign over her Saintfield home to her son George Ignatius Martin and daughter-in-law Mary Martin.(1)

For more, see Lawyer accused of cheating woman (94) out of her home.

Go here, here, here, here, here, and here for other posts on elder financial abuse.

(1) During an arraignment at Belfast Crown Court last week, Ervine (51) pleaded not guilty to forgery and using false Land Registry forms with intent; and was joined in the dock by husband and wife George Ignatius Martin and Mary Martin, who both pleaded not guilty to obtaining property by deception, forgery and using false land registry forms with intent, according to the story. DeedTheftAlpha FinancialAbuseOfElderlyAlpha

Judge Voids Tax Lien Foreclosure Sale; Finds Faulty Notice To Owner = No Due Process; Subsequent Purchaser Ordered To Give Back Property

In Bridgeport, Connecticut, The Connecticut Post reports:

• A Wood Avenue lot seized by the city through foreclosure and sold to a developer must be given back to the original owner, a Superior Court judge ruled last week. Judge John Blawie ruled that because the city did not send notice of the foreclosure to the correct address, its attempt to take property for tax delinquency is null and void.

• Waikele Properties Corp., the Garden City, N.Y.-based developer that bought the Wood Avenue property from the city after the foreclosure, had begun clearing the property, digging a large hole in the center to build a house.

• "In this case, the best address for the [defendant] was available right in City Hall. Because city officials did not comply with the notice procedures found in the governing statute," Blawie states in his ruling. "This court finds that due process was not afforded the [defendant] before tax liens on the property were foreclosed."

***

• "Because notice of the petition was never mailed to the correct address, the defendants had no opportunity to present their case in court and be heard in its support before the property was taken by the plaintiff for unpaid taxes," the judge said. "At the very least, the defendants were deprived of the opportunity to make payment of any delinquent city property taxes before the court ordered the forfeiture of their property to the plaintiff."

For more, see Foreclosure notice to dead man (Judge orders seized, then sold, land returned to owner).

Go here for other posts on foreclosures involving faulty notifications to property owners. foreclosure faulty notice

Lawsuit Alleges Rent-To-Own, Rent Skimming Scam Led To Foreclosure

In Augusta, Georgia, the Augusta Chronicle reports:

• Regina Preetorius blames the real estate market crash. A class action lawsuit filed in federal bankruptcy court says something else caused people who did business with her company, S.D.A. & Associates, to lose their investments and face eviction papers -- fraud.

***

• [Juan Valencia and Decia Bostic-Valencia] got kicked out of a house in south Augusta last year despite putting nearly $16,000 down, paying $4,000 to "loan broker" Fred Climer and making 12 monthly payments of $976, the lawsuit says. They thought that they were working toward home ownership in a rent-to-own, bond-for-title deal, [their attorney Jack] Long said. Unbeknownst to them, the complaint alleges, S.D.A. took their money while letting an outstanding mortgage on the house go unpaid, leading to foreclosure.(1)

For more, see Fraud involved in home deals, lawsuit claims.

Go here for other posts and updates on this story.

For more on problems with "Rent To Own" and Lease / Option real estate deals, go here and go here.

(1) According to the story, the lawsuit names Mrs. Preetorius, her husband, Charles "Greg" Preetorius, and Mr. Climer as defendants and seeks to create a class of plaintiffs who fell into predicaments similar to the Valencias. rent to own lease purchase option scams yellowstone

Mass AG Brings "Sewer Service" Charges Against Process Server In Civil Suit For Allegedly Failing To Deliver Legal Papers To Parties Named In Lawsuits

From the Massachusetts Attorney General's office:

• Attorney General Martha Coakley’s Office has filed a lawsuit and obtained a temporary restraining order against Boston-based process server Stokes & Levin, Inc. and its sole officer and director, Darren Stokes, in connection with allegations that Stokes & Levin engaged in a pattern of falsifying service of legal papers and filing those documents with state and federal courts.

***

• According to the complaint, [...] Stokes & Levin filed documents on multiple occasions with courts, indicating that it had served documents on the intended recipients, when in fact, Stokes & Levin had not served the documents at all. These alleged actions left individuals exposed to potential liability in cases that they may not have been aware of.

• Stokes & Levin also allegedly misrepresented in court filings and at court hearings that service of legal documents had occurred, thereby signaling that cases could proceed, when in fact, the intended recipients had not received the documents and were not on notice of the legal proceedings and hearings in which they were expected to participate and attend.

For more, see AG Coakley Obtains Temporary Restraining Order Against Process Server for Making False Representations to Courts.

Go here for other posts on "sewer service" which, according to at least one source, is so named on the theory that the process server simply tosses the legal papers into the sewer instead of attempting to deliver them to the proper party named in the lawsuit. The server then files a sworn statement with the court attesting that the papers were properly served on the named parties. SewerServiceAlpha

Lenders' Problem Of Proving Promissory Note Ownership In Foreclosures Continues

In Sarasota, Florida, a recent column in the Herald Tribune describes the story of a local couple facing foreclosure that illustrates the problem some lenders are having proving in court that they have right to bring a mortgage foreclosure action, because of an inability to present proof of ownership of the promissory note secured by the mortgage.

• Though there was apparently good cause to foreclose, and though Wells Fargo was represented by a Tampa firm that specializes in mortgage cases, Judge Paul Logan has dismissed the case. Why?

• [The homeowners' attorney Nina] Perry hadn't claimed the couple had made the payments or soon would. She said that the plaintiff hadn't been able to show it had the right to sue, because there was no proof it owns the mortgage. Such proof isn't always easy now, when so many mortgages have been packaged as securities and sold and resold in bulk to various financial institutions that are often confused themselves about what they own.

• Perry says the Bradenton case isn't necessarily over. The foreclosure could be filed again, with new evidence or maybe with a new plaintiff. But in the meantime, the owners haven't been kicked out and it may have become a better time for the right plaintiff -- if found -- to choose to make a deal.

For more, see Proving who owns a mortgage isn't easy.

For posts that reference the failure of some mortgage lenders and their attorneys to prove ownership of the promissory note when starting foreclosure actions, Go Here, Go Here, Go Here, and Go Here. missing mortgage foreclosure docs gamma

Lien Stripping Of Subordinate Home Mortgages In Bankruptcy Gaining In Popularity?

In Las Vegas, Nevada, the Las Vegas Business Press reports:

• Homeowners upside down in their mortgages and facing foreclosure may have a new recourse. The relatively new practice of "lien stripping" is becoming a popular way to get out from under double mortgage payments and sometimes save homes. Not everyone, however, is praising the practice.

• The lien removal business has increased in recent months as property values continue to sink. At least a handful of local bankruptcy attorneys are performing lien stripping for clients. One is making it a focal point of her practice.

For more, see That LIEN AND HUNGRY LOOK (Mortgage 'stripping' becomes marketing tool for bankruptcy attorneys).

For other posts on homeowners using Federal & state consumer protection statutes to try and undo bad mortgage loans, Go Here, Go Here, and Go Here. UndoMortgageLoans TILAdelta

Some Cash-Strapped Florida Condo Associations Resorting To Rent Skimming For Badly Needed Funds?

In Miami, Florida, the Daily Business Review reports:

• Members of the board of The Grand condominium north of downtown Miami were increasingly frustrated as they waited for lenders to take over units facing foreclosure. Each month the units were in limbo was a month that desperately needed maintenance fees went unpaid.

• Finally, the board decided on an unorthodox solution: Be the first to foreclose on the unit, then find a tenant and recover some of the delinquent dues through rents — at least until the lenders take back the unit.

***

• Miami attorney Dennis Bedard is advising condo boards he represents to foreclosure on units whose owners are behind on maintenance fees and begin renting out the condos. [...] So far this year, The Grand, a Bedard client, has foreclosed on and rented 12 of 810 condos in the high-rise building at 1717 N. Bayshore Drive.(1)

For more, see Condo Meltdown: Condo boards in quest of cash.

(1) It is quite common for an institutional mortgage to contain an "assignment of rents" clause, which basically says that any rent generated by the property pledged as collateral for a mortgage loan itself shall serve as additional collateral for said loan. While the condo association pocketing the rent and stiffing the mortgage lender in the way described in this story may not be liable on the promissory note for making the mortgage payments, it could nevertheless be violating the terms of the mortgage (ie. by extracting the rent collected from the condo unit, which, technically, is part of the loan collateral, and applying it for its own purposes).

Also, assuming that a mortgage lender could legally considered to be an"owner" of an interest in the property in that it holds a security interest therein, I wonder if a mortgage lender could attempt to invoke Florida's anti rent skimming statute, F.S. 697.08 against a condo association in this type of case.

Tennessee AG, Memphis Legal Services Firm File Suits Against Upfront Fee Foreclosure Rescue Operator

In Nashville, Tennessee, WTVF-TV Channel 5 reports:

• The Tennessee Attorney General filed suit Tuesday against a company suspected of charging consumers for services it and its principals have not provided. The lawsuit filed against Tennessee Housing Protection Agency, Inc., alleges violations of consumer protection laws.

• "With foreclosures in Tennessee going up, we are concerned that homeowners across the state may turn to ‘foreclosure rescue' operations such as this that in some cases offer only false hope," said Tennessee Attorney General Bob Cooper, in a news release.

• The lawsuit also alleges that the Memphis-based company's name is misleading and deceptive to consumers. The name sounds similar to an agency authorized by the state. The company is not a government agency and is not affiliated with the state.

• The Memphis Area Legal Services also filed lawsuits against the company and its principals.

Source: AG Files Suit Against Foreclosure Rescue Company.

Go here for the WTVF-TV Channel 5 video.

See also:

• Tennessee AG's press release: Attorney General Files Suit Against Tennessee Foreclosure Rescue Company,
• Memphis Commercial Appeal: Home-loan help agency faces suit (Foreclosure rescue 'unfair, deceptive,' customers say).

North Carolina AG Files Suit Against 3 Foreclosure Rescue Operators For Clipping Consumers Out Of Illegal Upfront Fees

From the North Carolina Attorney General's office:

• Attorney General Roy Cooper is taking legal action to stop three Charlotte area foreclosure rescue companies from charging high fees but failing to save consumers’ homes.(1) [...] Cooper made the announcement at the Better Business Bureau (BBB) of the Southern Piedmont, which has assisted with the cases.

• “Homeowners turn to foreclosure rescue services because it sounds like the solution to all of their problems,” said Tom Bartholomy, president and CEO of the BBB of Southern Piedmont. “We want homeowners to know that anyone who charges you an advance fee for foreclosure help is trying to scam you and is breaking the law.”

• In 2005, Cooper worked with state legislators to make it illegal for any foreclosure assistance business to collect fees upfront.

For more, see AG Cooper goes after Charlotte foreclosure rescue scams (Firms take struggling homeowners’ money, fail to save their homes).

(1) According to his press release, Cooper announced yesterday that he has filed suit against the following companies and their agents: Robert E. Cassell, Jr., doing business as American Mortgage Assistance in Fort Mill, SC; Home Assure, LLC and its vice president Michael Grieco of Charlotte; and Metrolina Mortgage Relief, LLC and its president Jeffery Mika of Charlotte.

San Diego DA's Office Using Mail To Issue Scam Warnings To Homeowners Facing Foreclosure

In San Diego, California, NBC-TV Channels 7/39 report:

• Those falling behind on their house payments are increasingly being targeted by scam artists. Authorities say it's a problem that is likely to get bigger as more homeowners face foreclosure. The deputy district attorney's office has moved to protect homeowners, by sending out pamphlets to people who are late paying their mortgage or have received what's called a notice-of-default.

• "We've seen a lot more activity in people taking advantage of distressed homeowners and we want to make sure they know how they're protected," said Michael Groch, Head of the Economic Crimes Division at the Deputy District Attorney's Office. He said those offering services to help those facing foreclosure: (1) Cannot accept money up-front, (2) Cannot take an ownership interest in the home, (3) Must provide a written contract detailing services offered, including how the contract can be terminated.

• Groch says not following these guidelines could be a misdemeanor or a felony. They can carry a maximum sentence of up to three years in prison.

For more, see Scam Artists Target Foreclosure Victims (Authorities move to protect distressed homeowners).

Bringing Equity Strippers To Justice May Be Tough Row To Hoe

In Minneapolis, Minnesota, Minnesota Public Radio reports:

• There's no running count being kept, but observers agree that most of the tens of thousands of Minnesotans scammed by equity strippers, predatory lenders and mortgage fraudsters have not gotten justice. The record for those who try is mixed.

For more, see Thousands of foreclosure scams yield a small number of criminal charges.

Go here for criminal prosecutions of foreclosure rescue operators.

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

California AG Files Criminal Charges In Alleged Foreclosure Rescue, Loan Modification Scam That Clipped Homeowners For Up To $5K In Upfront Fees

The California Attorney General's office announced yesterday:

• California Attorney General Edmund G. Brown Jr. [...] announced the arrests of three members of a fraud ring who preyed on desperate Southern California homeowners by falsely promising to renegotiate their home loans, but instead “ripped them off for thousands of dollars” while their homes fell into foreclosure.

***

• California [authorities] arrested Rosa Conrado of San Bernardino, Saul Amador of West Covina, and Jesus Flores of Baldwin Park, believed to be members of the fraud ring. Law enforcement officers have issued arrest warrants for Juan Perez of Grand Terrace, and David Giron of Ontario, who are also suspected to be involved in the scheme. The Attorney General’s Office filed a 39-count complaint that includes multiple grand theft, money laundering and conspiracy charges against these suspects.(1)

***

• “Loan-modification scams are becoming more and more prevalent across the country, particularly in California,” Attorney General Brown said. “California homeowners should be aware of the warning signs of foreclosure scams, so they don’t fall victim to these cynical schemes.”

For more, see Attorney General Brown Breaks Up Foreclosure Scam Ring.

California AG court documents in this case:

• Felony Complaint - People v. Amador, et al.,
• Declaration In Support Of Arrest Warrant,
• Flyer and Envelope allegedly used by the defendants to solicit business.

Go here for criminal prosecutions of foreclosure rescue operators.

(1) The arrests came after an investigation into First Gov, also operating as Foreclosure Prevention Services, uncovered that the company was soliciting hundreds of homeowners with mail flyers offering to help them stop the foreclosure process on their homes. The scammers falsely told homeowners that they would renegotiate their mortgages, reduce monthly payments, and transfer any delinquent loan amounts to the renegotiated principle. The company demanded an up-front fee, ranging from $1,500 to $5,000, to participate in the loan-modification program. The company also told the victims to stop any mortgage payments or communications with their lender, claiming they would interfere with the company’s effort to negotiate the loan modification.

Ohio Man Guilty Of 26 Counts In Foreclosure Rescue, Rent Skimming Scam; Allegedly Conned 14 Homeowners Into Belief He Would Renegotiate Home Loans

In Newark, Ohio, the Newark Advocate reports:

• As the guilty verdicts piled up -- 26 in all -- Harry Blausey sank further into his chair in Common Pleas Judge Thomas Marcelain's courtroom. [...] Blausey was facing 27 felony counts connected to a scheme he perpetrated on Licking County homeowners facing foreclosure.

• He was found guilty of deceiving those couples and individuals into signing over deeds to their homes on the premise Blausey would negotiate with their mortgage companies to avoid defaulting on their home debts. Testimony and documentation from the prosecution claimed Blausey had little, if any, communication with the lenders and profited by renting out the homes until they were sold at auction.

***

• He was convicted of [...] nine counts of grand theft, 13 counts of securing writings by deception and four counts of theft.(1)

For more, see Blausey guilty on 26 counts (Businessman convicted on all but most serious charge).

See also, The Columbus Dispatch: Newark man guilty in mortgage-fraud case.

Go here for other posts on foreclosure rescue operator Harry Blausey.

Go here for criminal prosecutions of foreclosure rescue operators.

(1) According to the story, Licking County Assistant Prosecutor Duke Frost said the potential exists to press forward with another indictment. "There are other pending allegations of similar conduct involving this defendant, and they'll be handled in the same manner as in any other case," he said.

Prince George's County Mortgage Foreclosure Fraud Unit Intent On Criminally Prosecuting Scammers

In Prince George's County, Maryland, The Sentinel reports:

• [I]n the last two months and on several occasions, [Prince George's County] State's Attorney Glenn Ivey has emphatically stated his intent to aggressively surface and prosecute mortgage scammers who have defrauded new homeowners. "Not in this county, not in this state," is the mantra under which the new Division operates, said its staff.

***

• [The Economic Crimes Unit of Ivey's office] is screening more than 10 calls a day, making a distinction between bad financial decisions vs. fraud for theft and fraud for profit and then investigating and prosecuting the most egregious first.

• While Montgomery County's State's Attorney's office is also prosecuting mortgage fraud, Prince George's is the only jurisdiction with a dedicated unit, said Assistant State's Attorney Doyle Niemann, also of the Division, some weeks ago.

For more, see Briefing sheds light on mortgage fraud.

Nantucket's "Joe The Plumber" Sues Lenders To Back Out Of Bad Loans

On Nantucket Island, Massachusetts, The Inquirer and Mirror reports:

• [A]fter falling behind on his home mortgage last month, Joe Ciarmataro, an island plumber, has sued two mortgage companies in Nantucket Superior Court, claiming they knew he could not afford the $790,000 loan he took out to purchase a condominium on Witherspoon Drive in 2007.

• The lawsuit alleges “unfair and deceptive acts and practices” by Connecticut-based Master Key Mortgage as well as a Texas corporation, American Home Mortgage Servicing, and that Ciarmataro was defrauded by the two companies.

• Filed last week in Nantucket Superior Court, the lawsuit is illustrative of the national debate over whether predatory lenders or irresponsible borrowers are more responsible for the meltdown in the housing market and the dramatic rise in foreclosures.

• Ciarmataro is seeking to have a judge rescind the mortgage altogether, in addition to compensation for losses, interest costs and attorney’s fees.

For more, see Nantucket’s own “Joe the Plumber” sues mortgage co. for unfair practices.

California Judge's Use Of "Rocks for Brains," "Obnoxious" & Other Remarks Towards Attorneys Yields Public Scolding By State Judicial Watchdog

In San Bernardino, California, The Associated Press reports:

• A retired San Bernardino County judge has been publicly scolded by California’s judicial watchdog for rude, demeaning comments to attorneys. In one case, Superior Court Judge Paul Bryant Jr. suggested a prosecutor had “rocks for brains” for agreeing to a settlement. He called another lawyer “obnoxious” in front of his client.

• The Commission on Judicial Performance admonishment Monday said Bryant failed to be “patient, dignified and courteous toward individuals he dealt with.” Bryant says only that it’s been a pleasure to serve the courts.

• Bryant was a judge at the Rancho Cucamonga courthouse for 18 years before retiring. Now, he often serves as a retired judge on assignment in San Bernardino civil courtrooms.

Source: Judge scolded for rude courtroom remarks.

To view the admonishment, see In re Bryant - Decision And Order Imposing Public Admonishment.

For other posts on the questionable judgment exercised by some of the members of our esteemed judiciary, go here and go here. knuckleheaded judges zeta

Hip Hop Artist Alleges Forged Deed To Property In Baltimore Bankruptcy Court Proceeding; Seeks To Void Title Transfer

In Baltimore, Maryland, The Associated Press reports:

• Usually you wouldn't think of a member of Salt-N-Pepa being shy at all in front of an open mic. But when the mic is on a witness stand at a court in Baltimore and the issue is money, you can understand why Sandra "Pepa" Denton said she was a little nervous. The judge told her to "take a deep breath and relax" to calm her nerves.

• Denton was in court in a case that pits her against her ex-husband and his new wife over a property sale. She claims Emora Horton bought the home in Baltimore after a friend forged a signature on a deed. Denton wants the property returned to her. The defendants deny taking part in any fraud or forgery. A ruling is expected in January.

Source: Member of Salt-N-Pepa in Court.

------------------

See also, The Maryland Daily Record, which reported:

• Whether Denton will get that property back, with or without liens, turns on the legal distinction between fraud and forgery, lawyers in the case say. “It really lives or dies on the forgery issue,” U.S. Bankruptcy Judge Robert A. Gordon said to Denton’s attorney, J. Michael Broumas.

***

• Attorneys for the entities that made loans [secured by the property] argue [the deed signer's] actions instead constitute fraud [as opposed to forgery], since [the deed signer] signed his own name and made no attempt to conceal his identity. Under such a scenario, the property might still be Denton’s but would come with the lenders’ considerable liens, Broumas said. [...] Judge Gordon said his own research centered on a case out of the District of Columbia, McNairy v. Baxter, in which a forged limited power of attorney document made a subsequent deed ineffective.

For more, see:

• Rapper ends hearing with hugs, tears (Property still at issue, but Pepa lets ex-rival’s debt go); and
• Singer claims ex-husband pushed her into investing in Baltimore property.

IRS Eases Tax Rules On Mortgage Securtization Trusts That Engage In Loan Modifications Aimed At Reducing Foreclosures

Mondaq.com reports:

• Many pools of mortgages are held in tax advantaged entities that qualify for tax purposes as REMICs that avoid double taxation under the Internal Revenue Code. But for an entity to qualify as a REMIC, the pooled mortgages must be basically treated as static pools of mortgage loans. Loan modifications could force a REMIC to lose its favorable tax treatment, and once REMIC status is lost, it is lost forever. This means that REMIC efforts to minimize foreclosures through loan modifications can threaten favorable tax status of the REMIC and its owners.

• To address these risks, the Internal Revenue Service and U.S. Department of the Treasury have taken actions to expand safe harbor rules that apply to REMICS. Through a number of recently issued revenue procedures, the IRS has provided assurances that REMICs can retain their favorable tax status when mortgage servicers make certain loan modifications as part of programs aimed to reduce foreclosures. The safe harbors allow REMICs to engage in certain, previously prohibited activities that in the past could have resulted in significant tax penalties.

For more, see Relaxed REMIC Requirements: IRS And Treasury Efforts To Address The Subprime Mortgage Crisis.

NJ To Take Statewide Approach To Mandatory Mediation Program In Owner-Occupied Home Foreclosure Actions, State Chief Justice Says

The New Jersey Judiciary announced:

• [New Jersey Supreme Court] Chief Justice Stuart Rabner [last week] announced the roll-out of a statewide Judiciary program to assist homeowners in foreclosure actions. The program will provide mediators to help homeowners and lenders negotiate with one another and try to work out agreements to avoid foreclosures.

• Chief Justice Rabner said, “While the courts must remain neutral in all foreclosure matters, it is in everyone’s best interest to have a forum where homeowners facing foreclosure have the opportunity to negotiate to save their homes. Our goal is to get lenders and borrowers to meet at the table and work out a mutually beneficial arrangement. I encourage continued cooperation among the courts, lenders, borrowers, and the bar as we address the increasing number of foreclosure actions in New Jersey in today’s difficult economic times.”

• Under the program, the courts will require mediation in all cases in which homeowners contest owner-occupied foreclosure actions. Volunteer mediators will meet with eligible homeowners and their lenders in an effort to resolve the foreclosure action and renegotiate the terms of mortgage agreements.

For more, see Judiciary Announces Foreclosure Mediation Program to Assist Homeowners at Risk of Losing Their Homes.

Florida Court To Impose Formal Conciliation Process Upon Lenders In Home Foreclosure Actions

In Sarasota, Florida, the Herald Tribune reports:

• As more and more Florida homeowners slip into foreclosure, the law firms handling the cases for the banks have become harder to reach, those familiar with the system say. Homeowners and their attorneys, and even judges, cannot get a call back, making it impossible to dispute a debt or work out deals other than foreclosure until the case is in front of a judge. "The lenders are just not talking to them," Chief Circuit Judge Lee Haworth said.

• Now, Haworth and other 12th Judicial Circuit court judges are going to force those law firms to meet with the homeowner within 45 days for a frank discussion on alternatives to foreclosure. Those discussions could center around refinancing, forgiving part of the debt or clarifying the amount required to reinstate or pay off the loan.

• The Homestead Foreclosure Conciliation Program will start in December. It aims to keep people in their homes and reduce the strain on the court system from foreclosure cases, which are on pace to double this year compared with 2007. The program applies only to property registered as a primary residence under the homestead exemption. Local bar associations and legal aid organizations agreed to provide some attorneys to assist those homeowners during the meeting at no cost.

• The law firms representing lenders are also required to notify any homeowner of the program, contact them and invite them to participate. The large increase in foreclosures has strained almost every part of the foreclosure process, from serving legal papers to finding courtroom time. Coming to a solution within 45 days would avoid protracted legal battles and reduce the number of cases going through the system.

• Those long legal battles seem to be the only way to get law firms representing banks to return calls, Miami-based foreclosure attorney Rick Neustein said. "Most of the time they don't want to talk to us until they see this thing is being hotly contested," Neustein said. "They don't get serious until we're defending the foreclosure for nine months."

• Haworth said the main issue is only a small number of law firms handle the foreclosure cases for the banks for small legal fees, so they want to put as little time as possible into a case.(1) If the law firms do not comply with the new order, they will face courtroom sanctions that would cost them money, since it would take their attorneys more time to handle the cases.(2)

For the story, see Lenders told they can't hide (if there's a problem with this link, try here).

For more on the new foreclosure procedural rules in Florida's 12th Judicial Circuit, see:

• Administrative Order Establishing Circuit-Wide Homestead Foreclosure Conciliation Program.
• Attorney's Certificate of Compliance With Twelfth Circuit Homestead Foreclosure Conciliation Program.
• Chief Judge's Letter Summarizing New Foreclosure Procedures & Administrative Orders.

Go here for Notice To Attorneys Filing Foreclosure Actions in Florida's 12th Judicial Circuit.

(1) Go here for more on so-called Assembly Line, Foreclosure Mill Lawyering in foreclosure actions.

(2) According to the story, the law firms for lenders would not be able to settle the case through a summary judgment, a quick resolution to cases. The lender attorneys would no longer be able to appear at hearings over the telephone. And that lender's cases would be assigned the lowest priority for court hearing times, which may delay the case for an extended period. ForeclosureMillAttorneysAlpha

Lawmaker To Attempt To Lift State Homestead Exemption Limit To Attract Wealthy To Move To Nevada

Buried at the end of a story on a proposed new law to safeguard Nevada tenants unwittingly renting homes from landlords in foreclosure, the Las Vegas Sun reports:

• [L]egislators and local governments so far have asked that 633 bills be drafted for introduction next year. [One] recent request comes from Assemblyman Morse Arberry, D-Las Vegas, who wants to remove the cap of $550,000 on homestead exemptions.(1)

• The law protects the forced sale [except for mortgage foreclosures] of a home whose value is up to $550,000 to recover a debt if the property has been designated as a homestead. The 2007 Legislature raised the homestead exemption from $350,000 to $550,000.

• And Arberry said he is working on a bill to eliminate the cap as a way to attract rich people to locate in Nevada. Otherwise if these affluent people had a $1 million home that was designated as a homestead, it would be shielded from judgments to collect any debt [except home mortgages and certain other debts].

• The present law provides that if the home is worth more than $550,000, a judge must appoint three independent appraisers to value the home. If it exceeds the homestead exemption permitted, the judge must decide whether any part of the property can be sold to satisfy the debt without “material injury” to the home. If the judge decides the property can not be divided, than [sic] he can order home sold and the money divided between the creditor and the homeowner.

For the story, see Bill to protect renters in foreclosure cases.

(1) If successful, Nevada will be eligible for induction into the Homestead Exemption Hall of Fame, joining the great states of Florida, Texas, Oklahoma, Kansas, and Iowa who likewise impose no dollar limit on the amount of home equity (ie. loosely defined for homestead exemption purposes, as home value less existing home mortgages, unpaid real estate taxes, IRS tax liens, and unpaid home improvement costs - check the relevant state law for the exact specifics) a state resident can play "keep away" with when fending off unsecured general and judgment creditors seeking repayment of debts they've been stiffed on. There are, however, limitations based on property size, such a limit may depend on whether the home is located within or outside of an incorporated municipality (or, in the case of Texas, whether state law considers the homestead to be an "urban homestead" or a "rural homestead").

Extortion Sting Results In Charges Against Maryland Man For Allegedly Trying To Squeeze $5K From Winning Bidder At Foreclosure Sale

In Elkton, Maryland, The Associated Press reports:

• The Cecil County Bureau of Investigation has charged an Edgewood man with extortion for allegedly demanding money from the winning bidder in a home foreclosure auction. Authorities say 48-year-old Frank Wilhelm telephoned the winning bidder one day after the auction and threatened to challenge the sale unless he was paid $5,000. Lt. Bernard Chiominto says challenging the sale would have frozen the bidder's payment, possibly for months.

• Wilhelm was arrested last Thursday in Perryville, after the winning bidder contacted police and helped them set up a sting. According to Chiominto, Wilhelm told investigators that he had heard that winning bidders "usually pay up" when threatened with a contested auction sale.

Source: Edgewood man faces extortion charge.

Professional Conflicts Of Interest An Obstacle For Some Attorneys In Pro Bono Foreclosure Fight

American Banker reports:

• As the mortgage crisis deepens, lawyers around the country are volunteering to help distressed homeowners avoid foreclosure, but those with the most relevant experience often face the potential for conflicts of interest involving lender clients. [... G]etting involved has [...] created a delicate situation for some of the largest law firms, which have the most staff to contribute to such projects — but often represent major lenders.

***

• The conflict-of-interest question was particularly urgent for the Lawyers' Foreclosure Intervention Network, a New York pilot program that had to negotiate a structure that would satisfy the state's laws and the city's high concentration of major financial institutions — and the major law firms that represent them. [Read the New York City Bar's Ethical Opinion on Firms Handling Foreclosure Matters Pro Bono].

For more, see Homeowner Legal Aid Programs Address Conflicts.

Connecticut Renter Facing Foreclosure Eviction Invokes New Bailout Law In Attempt To Fight Off Fannie

In Hartford, Connecticut, The Hartford Courant reports:

• Four days after Evelyn Colon paid the September rent for her Hartford apartment, a U.S. marshal knocked on the door. He handed her a notice that she had to be out in a month. Fannie Mae, the huge mortgage financier, had foreclosed on her building and was evicting Colon and two other tenants.

• Colon is now fighting her eviction in what her attorneys believe is the first court challenge in the country to use a provision(1) deep within the government's $700 billion bailout legislation to seek protection for renters facing eviction after foreclosure. She will be able to stay in her apartment while the case is litigated.

***

• Colon's attorneys at Greater Hartford Legal Aid Inc., an agency that helps low-income clients, are arguing that Fannie Mae became a federal agency when it came under the control of the Federal Housing Finance Agency Sept. 7 and is therefore bound by the financial services bailout legislation.

For the rest of the story, see Hartford Tenant Fights To Stay In Home After Foreclosure (if link expires, try here or try here).

See also, WTNH-TV Channel 8: Renter fights back against foreclosure:

• "Basically we've asked the court to throw this case out, the eviction, out of court, or, if the court doesn't feel comfortable doing that, to kind of put things on pause until the Treasury or another federal agency, perhaps the F.H.F.A. (Federal Housing Finance Agency), issues a policy statement saying what does the language in the Bailout Bill mean," said Stephanie D'Ambrose from Greater Hartford Legal Aid.

(1) Section 109(b) of the Federal bailout bill may require the U.S. Secretary of the Treasury to work with the F.H.F.A. and other government entities to permit tenants like Evelyn to remain in their apartments after foreclosure. BetaTenantRentSkimming

L.A. Official Calls For Stop To Illegal Foreclosure Evictions; Lender Accused Of Stiffing Booted Tenants Out Of $7K "Relo Fee" Required By City Law

In Los Angeles, California, CBS 2 reports:

• Los Angeles City Council President Eric Garcetti called Friday on Countrywide Home Loans to stop the practice of evicting tenants from apartment buildings that have gone into foreclosure. The councilman pointed to the case of Johnny Lee, who lives in a triplex in Echo Park. Following foreclosure, Countrywide allegedly pressured Lee to leave the apartment and offered him a $2,000 relocation fee. City law requires a $7,000 fee in such cases, according to Garcetti.

• A representative for Countrywide was not immediately available for comment. "It's really frustrating, and I feel like I was duped," Lee said. "I had no idea that this was illegal and that I had a right to stay or to a minimum amount of money. In fact, I was told I would have to be out within 30 days and didn't have the right to any money, even my security deposit," he said. "I encourage others in this situation to learn more about their rights as tenants."

• In a letter to Countrywide, Garcetti said the Calabasas-based company attempted a similar eviction earlier this year in South Los Angeles. "Months later, it appears that Countrywide and its agents continue to violate city law by illegally pressuring tenants to vacate foreclosed properties and offering relocation fees below what is required by law," Garcetti wrote. "I am writing to ask that your company cease and desist illegal foreclosure-related eviction practices immediately. In addition, Countrywide must bring its eviction practices and guidelines into compliance with the city's Rent Stabilization Ordinance."

Source: Councilman To Countrywide: Stop Illegal Evictions.

See also: Countrywide to EP tenants: get moving. BetaTenantRentSkimming

Forensic Loan Review Firms Begin To Pop Up Offering To Find Errors In Loan Docs For Homeowners Fighting Foreclosure

A syndicated column in the Los Angeles Times reports:

• Homeowners who are having difficulty getting the attention of their lenders to discuss their troubled mortgages might want to obtain a forensic loan review to determine if their lenders made any mistakes when the mortgage was issued.

***

• In a forensic loan review, a legal pathologist scours your loan documents looking for errors in, among other things, the truth-in-lending statement the lender provided shortly after you applied for your mortgage and the lender's annual percentage rate calculation so you could compare loan costs. If the truth-in-lending statement doesn't match the HUD-1 closing-cost sheet you received at closing, if the APR is off by just a hair, you might have cause for legal action against the lender.

For more, see Errors in loan documents can save strapped homeowners (Even small mistakes in the paperwork may give borrowers the legal leverage to persuade lenders to rework their mortgages).

----------------

For a recent story of a foreclosure mitigation company which offers to audit and find errors in loan documents and promises homeowners help in fighting foreclosures, and which is now being sued by the Florida attorney general for alleged deceptive practices and the unauthorized practice of law, see:

• Lauderdale firm didn't deliver mortgage relief, state suit alleges (Lauderdale company denies wrongdoing and says it was let down by law firms it trusted to help individuals),
• Broward Foreclosure Debt Mitigation Company Sued for Deceptive Practices. UndoMortgageLoans TILAdelta

Texas Man Sues To Void Deed In Alleged Land Swindle

In Beaumont, Texas, The Southeast Texas Record reports:

• A Jefferson County man has filed suit against a Beaumont couple and the woman's mother, claiming their conspiracy against him has forced him to lose property that belongs to him. Glen Ray Waldrop claims he is the owner of 3.27 acres located [...] in Beaumont.

• He entered into what he believed to be a contract for deed with Jeff Allen and Theresa Ann Theal in May 2001, according to the complaint filed Oct. 21 in Jefferson County District Court. In the contract for deed, Waldrop believed the Theals would purchase the property through monthly installments, the suit states.

***

• In fact, the document Waldrop signed was a general warranty deed, transferring ownership of the property to the Theals, he claims. [...] Waldrop knew nothing about the general warranty deed or [the mother's] role until the Theals ceased their monthly payments in April 2007, the suit states.

For more, see Disabled man claims he was swindled out of property by local couple.

Go here, go here, go here, and go here for other posts related to deed theft by forgery, swindle, etc. DeedTheftAlpha

Iowa Widow Seeks To Stop Foreclosure, Void Deed & Mortgage; Claims Now-Deceased Husband Forged Her Signature On Legal Documents

In Polk County, Iowa, the Des Moines Register reports:

• Ed Boesen's widow says she has rights to two commercial properties because her husband forged her signature on a loan document and a property transfer document. Maureen Boesen is asking a judge to clear the titles on two properties despite more than $5 million worth of defaulted loans on them.

• Lawyers for Maureen Boesen, as well as James Monroe, attorney for the Boesen estate, made the claim in Polk County District Court in response to two lawsuits filed by lenders against Boesen's estate. The lawyers contend Ed Boesen forged his wife's signature on a mortgage document on one of the properties and on a deed transfer on the other.

• "Maureen Boesen asserts she owns the property and that the signatures on documents are without her authority," a motion filed last week by her lawyers says. As a result, neither loan is valid, the lawyers claim.

For more, see Boesen widow alleges forgery.

Go here to compare Mrs. Boesen's actual signature with those that were allegedly forged.

Go here, go here, go here, and go here for other posts related to deed theft by forgery, swindle, etc. DeedTheftAlpha

Feds, 23 States Join In "Operation Clean Sweep" In Attempt To Nail Credit Repair, Loan Modification, Debt Relief Operators

From the Florida Attorney General's Office:

• Attorney General Bill McCollum [last week] announced Florida’s participation in a collaborative effort targeting credit repair operators, many of which deceptively claim they can remove any and all negative information from consumers’ credit reports.

• The Federal Trade Commission (FTC) and 23 states joined forces in Operation Clean Sweep, a nationwide initiative to address this consumer protection issue. “Whether through credit repair, debt management, debt settlement, or interest rate reduction schemes, it is unacceptable to deceptively convince consumers facing financial distress to part with their money,” said Attorney General McCollum. Collectively, the FTC and the states took actions against 36 companies engaged in potentially deceptive or misleading conduct.

For more, see Florida Joins FTC, States Targeting Credit Repair Operations in "Operation Clean Sweep."

See also: Palm Beach Post: Claims of debt fraud soaring (Until he can persuade lawmakers to impose rules, Florida Attorney General Bill McCollum hopes lawsuits his office has filed and its investigations "send a message to this industry that preying on consumers in financial distress will not be tolerated.").

For the Florida AG's recent press release on a recent civil suit filed in this regard, see Broward Foreclosure Debt Mitigation Company Sued for Deceptive Practices.

Mortgage Loan Modification Companies Beginning To Draw Attention From Feds, Lawmakers

In Modesto, California, The Modesto Bee reports:

• The Justice Department is gearing up to probe potential scams targeting distressed homeowners in the San Joaquin Valley. On Friday, Rep. Dennis Cardoza, D-Merced, urged Attorney General Michael Mukasey to investigate mortgage-reduction schemes marketed in the region.(1)

• For an upfront fee, homeowners are being told their monthly mortgage payments can be renegotiated. At best, the homeowners may end up paying for work that's available for free. At worst, they'll pay for work that isn't done at all.

***

• The questionable solicitations come in different ways. Phone calls offering mortgage negotiation services have been ringing through the San Joaquin Valley for several months. [...] Official-looking letters are arriving in valley mailboxes, some citing congressional bill numbers or phone numbers for a "loss mitigation department."

• And Thursday in Modesto, some homeowners attended a workshop in which they were asked to pay $3,500 to get their mortgage woes resolved. Typically, the companies offer to renegotiate a mortgage in exchange for an upfront fee amounting to one month's mortgage payment, or more.

For more, see Loan-help schemes scrutinized (Claims to fix mortgages for fee set off red flags for the feds and Cardoza) (may require free registration).

(1) It may be that, in California, the services marketed by these operators may already be regulated under the state law regulating the conduct of foreclosure rescue operators who provide mortgage consulting services to financially distressed homeowners. The law, among other things, specifically prohibits the collection of an upfront fee. For the law, see California Mortgage Foreclosure Consultants Act - Section 2945 through Sction 2945.11 of the California Civil Code, as recently amended this year by AB 180, Mortgages: foreclosure consultants.

Arizona BBB Warns Of Possible Loan Modification Scams

The Better Business Bureau of Greater Arizona reports:

• In today’s economy, most homeowners would welcome a lower interest rate on their mortgage, which could result in a lower monthly payment. This has opened the door for loan modification companies to take advantage of consumers more than ever.

• Better Business Bureau is receiving reports from concerned Arizona consumers who are being solicited by unknown companies offering to help them reduce the interest rate on their mortgage loan.

• “The majority of the consumers being targeted by phone tell us they have never been late on their payments and are not even close to facing foreclosure,” said Matthew Fehling, President/CEO of BBB. “Consumers are being advised by these companies to stop making their mortgage payments and negotiate a lower interest rate. This is a definite red flag,” added Fehling.

For more, see BBB Warns Consumers about Loan Modification Phone Calls.

Reports Of Hedge Fund Threats Against Loan Servicers Making Loan Modifications Outrage Lawmakers

In Washington, D.C., Politico reports:

• Barney Frank is not happy with hedge funds. Specifically, he and other top House Democrats are “outraged” that some hedge funds are telling mortgage service companies not to modify distressed mortgages with the help of the government program Frank helped craft.

• The New York Times reports that at least two hedge funds told servicers they might take action against them if the servicers participated in the government program to help homeowners avoid foreclosure. The program, which became law in July, just took effect at the beginning of October.

• Frank (D-Mass.) and four other Democratic members of his Financial Services Committee wrote an angry letter to the CEOs of the hedge fund companies named in the article, Braddock Financial Corporation and Greenwich Financial Services. The lawmakers wrote that they “strongly urge” the companies to reverse their position on the modification issue and informed each CEO that they’re scheduling a Nov. 12 hearing at which both will be asked to testify.

For more, see Frank threatens financial industry, calls hearing.

See also:

• House Financial Services Committee press release: Lawmakers Demand Hedge Funds Drop Opposition to Foreclosure Prevention,
• Letter to Braddock Financial Corporation,
• Letter to Greenwich Financial Services,
• Letter to Managed Funds Association.

Disbarred Florida Attorney Gets 10 Years For His Part In Alleged Sale Leaseback, Foreclosure Rescue Scam That Defrauded 50+ Homeowners

In Tampa, Florida, WTSP-TV Channel 10 reports:

• A federal judge has sentenced a disbarred lawyer to ten years in prison on his guilty plea to a mortgage scheme that stole the equity from more than 50 homeowners. Graham Daniel Kligerman, 34, of Clearwater, was also ordered to pay $6.5 million in restitution. The U.S. Attorney's office said Kligerman was part of a mortgage foreclosure rescue scheme that defrauded more than 50 homeowners.

For more, see Disbarred lawyer sentenced in mortgage fraud.

See also:

• U.S. Attorney (Tampa, Florida) Press Release: Clearwater Man Sentenced To Ten Years For Mortgage Fraud,
• The Tampa Tribune: Clearwater Lawyer Gets 10 Years For Real Estate Scam,
• St. Petersburg Times: Disbarred Clearwater lawyer gets 10 years in Florida mortgage scheme,
• Original Criminal Complaint - U.S. v. Kligerman,
• Go here for more on Graham Kligerman.

Go here for criminal prosecutions of foreclosure rescue operators and home equity scammers.

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

DC AG Settles Civil Suit With Title Closing Agent In "Money Store" Equity Stripping, Sale Leaseback Foreclosure Rescue Scam

In Washington, D.C., the Office of the District of Columbia Attorney General announced:

• Acting Attorney General Peter Nickles announced [yesterday] that the District has entered into a consent order with a title settlement company and its principal which participated in the Metropolitan Money Store mortgage rescue scam. The companies, Regional Title & Escrow, LLC and RTE Title LLC, and their principal, Valeria Tomlin, are permanently prohibited from performing settlement services in the District and will pay $575,000 to homeowners in the District of Columbia and Maryland who were stripped of title and substantial equity in their homes. The settlement is subject to approval by the DC Superior Court.

• The District’s complaint alleged that Tomlin and her title companies performed settlement services and otherwise participated in mortgage loans they knew were not bona fide. In entering into the consent judgment, Tomlin and her title companies denied that they engaged in wrongful conduct.

[...]

• The complaint also alleges that Metropolitan Money Store conducted a major mortgage rescue scam in which it targeted 25 homeowners in the District of Columbia. As part of a “Foreclosure Reversal” scheme, Metropolitan Money Store and others falsely promised to help the homeowners avoid foreclosure, keep their homes, and repair their damaged credit. Metropolitan Money Store then diverted proceeds from purported sales of these homes to itself and related companies.

• The District continues to seek relief for victimized homeowners from other defendants in its lawsuit filed in Superior Court, District of Columbia vs. Metropolitan Money Store, et al., Civil Action No. 6023-07 B.

For the D.C. AG's press release, see District Announces Agreement With Title Settlement Company in Mortgage Rescue Scam.

Go here and go here for other posts on the alleged Metropolitan Money Store foreclosure rescue scam. joyjackson

NJ AG Targets 39 In Suits Alleging Equity Stripping, Sale Leaseback Scams; Involved $13.5M In Bogus Loans & 48 Homeowners Screwed Out Of $3M+, Says AG

In Bergen County, New Jersey, The Star Ledger reports:

• Forty-eight New Jersey property owners have lost more than $3 million in home equity through "foreclosure rescue" schemes operated by Vest Financial and JP Global Property Management Inc., according to civil lawsuits filed by the state Attorney General's office.

• The lawsuits accuse the two companies, as well as 37 mortgage loan providers, mortgage industry employees, lawyers and others of violating the state's Consumer Fraud Act and the Racketeer Influenced and Corrupt Organizations Act. The state is seeking restitution for the property owners, penalties and permanent bans to keep them offering similar schemes to others.

***

• [New Jersey Attorney General Anne] Milgram said the companies preyed on desperate homeowners behind on their mortgages by persuading them to sell their properties to third-party investors as part of complex "sale and lease-back" schemes. [...] Vest Financial and JP Global never followed through on their promises. Instead, Milgram said, the companies stripped the homes of their equity value through the scheme and left the homeowners with no means to pay rent and with ruined credit histories.

For more, see State accuses firms of running predatory 'foreclosure rescue' schemes.

See also: Legal Newsline: Milgram: Foreclosure rescue schemes nothing but fraud ("Milgram says the defendants used predatory foreclosure rescue schemes to convince homeowners to sign over their homes, obtained at least $13.5 million in fraudulent loans and stole at least $3 million in homeowner equity.").

From the New Jersey Attorney General's office:

• NJ AG's lawsuit #1: Milgram v. Vest Financial LLC, et al.,(1)
• NJ AG's lawsuit #2: Milgram v. JP Global Property Management, Inc., et al.,(2)
• NJ AG's press release: Attorney General Sues Foreclosure Rescue Operations for Fraud and Racketeering (Defendants Allegedly Preyed on Homeowners Desperate to Avoid Foreclosure).

Go here for criminal prosecutions of foreclosure rescue operators.

For more on equity stripping scams, generally, see DREAMS FORECLOSED: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (4.61 MB approx.).

(1) The Defendants in this lawsuit are: Vest Financial, formerly of Paramus; Metropolitan Mortgage Services, Inc., of Cliffside Park; Alex Armani of Cliffside Park; Sohrab Moussavian of Englewood; Anthony Scordo III of West Orange; Felix Nihamin, an attorney who resides in Franklin Lakes and practices in New York City; Francis A. Ciambrone, an attorney with law offices in Paramus; Rhys A. Herrmann, of Belleville; JP Global Property Management LLC of Bloomfield; Peter H. Eckhardt, Jr. of Livingston; Philip Altieri of Flemington; Kristopher Pilone of Manalapan; DBK Realty Investments LLC of Edison; Tom A. Andriopoulos of Washington Township (Bergen County); Settlement Source, LLC of Edison; Vivian M. Ruiz of Hillsdale; and Glen B. Thompson, New York City.

(2) The Defendants in this lawsuit are: JP Global Property Management; Jeremy P. Sorvino of Waldwick; Jeffrey M. Malen of Ringwood; Peter Eckhardt, Jr.; Christopher William Eckhardt of Washington Township, (Bergen County); Anthony Scordo III of West Orange; Nihamin; Michael J. Andalaft, an attorney with law offices in Cedar Grove; Capital Hill Mortgage, Inc.; Stanley Capital Mortgage Company, Inc. of Englewood Cliffs; Rhys A. Herrmann of Belleville; Brendan Joseph Flynn of Fort Lee; Maryann E. Sorvino of Ridgewood; Frances B. Benna of Elmwood Park; Vincent F. Latorre of Kenilworth; Jennifer R. Kortman of Livingston; Rebecca A. Kortman of Chatham; William McVeigh of Wharton; Mauricio V. Almeida of Colonia; and Thompson.

California Woman Wins Race To Prosecutor's Office; Cops Plea In Upfront Fee Foreclosure Rescue Scam; Agrees To Testify Against Two Alleged Co-Scammers

In Monterey County, California, the Salinas Californian reports:

• One of three defendants in a Gonzales foreclosure scam made a plea deal Friday to charges including felony conspiracy to defraud, the Monterey County District Attorney’s Office said. All three defendants were accused of scamming more than 55 people in Monterey County of at least $100,000.

• Maria de Lourdes Ponce of Gonzales and Santa Cruz residents Fabian Olivares Casillas and Melissa Garcia were arrested in August, said John Hubank, a deputy district attorney with the consumer and environmental protection unit, on suspicion of taking thousands of dollars from homeowners after promising to save their homes from foreclosure.

Source: Plea deal in foreclosure scams against 55 Monterey County residents.

See also, The Monterey County Herald: Guilty plea in fraud case.

For the Monterey County DA's press release announcing the original charges, see District Attorney files felony charges filed against foreclosure scam artists.

Go here for earlier posts and available updates on this story.

Four Month Foreclosure Moratorium, Mediation Program Looming In Miami?

In North Miami, Florida, WFOR-TV Channel 4 reports:

• Miami-Dade County is dubbed the foreclosure capital of the state, and now the county could be taking on the most drastic housing relief effort to date. If Miami-Dade's chief judge approves this moratorium, it could stop all foreclosures for four months, starting as soon as November 1st. It's a measure that could eventually be adopted in all counties across the state.

***

• [North Miami Mayor Kevin] Burns wants a countywide moratorium on foreclosures, oddly enough one that even the banks could support. The program is mirrored of what Philadelphia started this summer that has remarkably saved 80% of their homes in foreclosure.

• "If they can do it in Philadelphia, the City of Brotherly Love, I think they can do it the City of North Miami but also in Miami-Dade County," said Burns. "And I assure you that if the Chief Judge approves it here in Miami-Dade County, they'll do it throughout the state of Florida."

• The plan is pretty simple: There would be a 120 day halt to all existing foreclosure filings, and new filings would be sent to mediators within 45 days of the filing. Essentially banks and homeowners would be forced to meet to work something out.

For the story, see North Miami Mayor Proposes Foreclosure Moratorium.

Bar Associations Ramp Up Nationwide Pro Bono Efforts In Fighting Foreclosures

The National Law Journal reports:

• [L]awyers across the country are doing their share to help homeowners facing foreclosures stemming from the subprime mortgage crisis. From Massachusetts to California, bar associations have formed task forces and organized pro bono projects offering services such as hotlines and free consultations regarding foreclosures, an issue many lawyers say could only get worse.

For more, see Bar Associations Nationwide Bulk Up Pro Bono Efforts in Foreclosure Cases.

Lenders Are Failing In Obligation To Identify All Occupants In Homes When Requesting Foreclosure Evictions, Says Chicago-Area Sheriff

According to a press release from Cook County, Illinois Sheriff Thomas J. Dart's office:

• [W]hile mortgage companies are supposed to conduct a basic due diligence investigation before requesting an eviction – identifying all occupants – sheriff’s deputies are regularly finding no work done by the mortgage company in advance, leaving the identifying work to deputies working at taxpayer expense.

• “These mortgage companies only see pieces of paper, not people, and don’t care who’s in the building,” Dart said. “They simply want their money and don’t care who gets hurt along the way. On top of it all, they want taxpayers to fund their investigative work for them. We’re not going to do their jobs for them anymore. We’re just not going to evict innocent tenants. It stops today.”

***

• [Dart] wants mortgage companies to be forced to provide sufficient information to the Sheriff’s Office in order to conduct an eviction. That will provide greater notification to tenants that their building is in foreclosure and will require mortgage companies and their attorneys to do more leg work in advance of an eviction.

For more, see Cook County Sheriff Suspends Foreclosure Evictions (Move comes in wake of growing mortgage crisis).

In related stories, see:

• Illinois Attorney General Backs Sheriff's Eviction Moratorium,
• Lawsuit Withdrawn Over Eviction Orders (A mortgage lender that filed a lawsuit to force the Cook County Sheriff to evict a suburban Chicago woman from her home has withdrawn the lawsuit. Accredited Home Lenders says it's also suspending its eviction action against Shirley McFarland of Dolton from her foreclosed bungalow.). BetaTenantRentSkimming

"No One Leaves Campaign" Takes To Boston Streets As Students Spread Word To Protect Tenants From Illegal Practices In Foreclosure Evictions

In Boston, Massachusetts, The Boston Globe reports:

• [106] Boston law and college students plan to join community activists to walk the streets of Dorchester, Hyde Park, and South Boston, to advise tenants to stand their ground and stay in their homes. Calling it the "No one leaves campaign," students aim to advise tenants of their legal rights to stay in their homes, even after foreclosure. That will help slow abandonment and blight in vulnerable neighborhoods. They are focusing on the 28 zones in Boston and Chelsea with the most foreclosures.

• "Tenants have an amazing amount of rights and a lot of ability to fight these evictions," said Harvard Law School student Nick Hartigan, 25, one of the main organizers. "Banks should do the responsible thing and allow people to stay."

***

• [Tracie Tyler, a 47-year-old administrative assistant fighting her eviction] is energized to have student involvement in what she sees as the important quest of getting the news out. "They are young, they are vibrant, they inspire us older folks," Tyler said. "There are people that are afraid who don't know where to go."

For more, see Students take to the streets to aid displaced tenants.

See also, Harvard Law Record: Harvard Law's foreclosure taskforce tackles housing crisis (Legal Aid Bureau leads effort to stop eviction of tenants in foreclosed properties). BetaTenantRentSkimming

Capital One, U.S Trustee Settle Charges Of Allegedly Screwing Over Consumers Filing Bankruptcy Over Credit Card Debt

The Wall Street Journal reports:

• The U.S. Trustee Program, an arm of the Justice Department that monitors bankruptcy courts, settled with Capital One Financial Corp. on Thursday over allegations that its credit-card unit filed about 5,600 claims on credit-card debts that it wasn't entitled to and improperly received $340,000 from debtors as a result.

• The settlement marks a victory for the U.S. Trustee Program, which in recent years stepped up its investigations into potential wrongdoing by some creditors against debtors in bankruptcy, following complaints from consumer advocates, law professors and judges that debtors weren't being adequately protected. That has been a particularly hot topic amid the current nationwide foreclosure crisis, in which many homeowners have turned to bankruptcy as a way to save their homes.

For more, see Capital One in Settlement Over Card Debt (may require subscription; if no subscription, go here, then click link for the story).

Finance Company Attempts To Collect Payments On A Paid Off Mortgage; Threatens Foreclosure, Damages Homeowner's Credit In The Process

In Saratoga Springs, Utah, KUTV Channel 2 reports:

• How would you like to pay off your mortgage, only to have some unheard of finance company ruin your credit ... And threaten foreclosure?? That's exactly what happened to a Saratoga Springs woman who decided to Get-Gephardt in desperation. The letter from M.G.C. Mortgage says the account is delinquent and they have the right to foreclose on the property...and they've reported it to our nation's credit bureaus!!!

For the rest of the story (video only), see Collections on a Paid Off Mortgage.

Foreclosure Rescue Victims May Have Been Scammed Again By Woman Accused Of Unauthorized Practice Of Law

In Central Florida, the St. Petersburg Times reports:

• [L]ike dozens of other Hispanic residents across Florida, they faced eviction because of their dealings with now-closed mortgage company 4 Solutions of Tampa. And like many of those 4 Solutions customers, they called Barbara Hernandez of Orlando after reading an ad in Spanish newspaper El Nuevo Dia where she offered to help people involved with the company.

• The residents say that she promised they'd get their houses back. That she said she'd lead them in a class-action lawsuit. That for only $50 a month, she'd help them file papers and go to court with them. About 80 families turned to her. The problem? She isn't a lawyer.

***

• Roberto Cruz, an attorney with the [non-profit law firm] Legal Advocacy Center of Central Florida, recently filed the [Florida Bar] complaint against Hernandez alleging unlicensed practice of law. Cruz of Sanford represents several residents hurt in deals worked out by 4 Solutions.

For more, see Victimized homeowners' advocate is not a lawyer.

San Bernardino Deed Theft Suspect Nabbed In Georgia

In San Bernardino County, California, the county district attorney's office recently announced:

• [H]oward Jerome Edwards was arrested by the Henry County Police Department at his residence in Locust Grove, Georgia. Edwards was arrested on the outstanding felony warrant that included charges of forgery, identity theft, and filing forged documents with the San Bernardino County Recorder’s Office.

According to the DA's office press release, Edwards and co-defendant John Foster, 50, of Riverside, forged the victim's signature on a Grant Deed and Deeds of Trust for property located in Fontana. Subsequently, Edwards and Foster sold the Fontana residence for $675,000.

Source: Man Arrested in Georgia on Real Estate Fraud Charges.

Con Man Gets 5+ Years For Victimizing Widow, Pocketing $2M In Refinance Scam

In San Francisco, California, The Recorder reports:

• Michael Edison, a con man who stole $2 million from the widow of a legendary law firm founder, has agreed to spend more than five years in jail. [...] Michael Edison admitted targeting Jean Phleger, widow of Brobeck, Phleger & Harrison founder Atherton Phleger, in a financial swindle. Originally introduced to Phleger by her son-in-law, the actor Don Johnson, Edison agreed to refinance Phleger's house, pay down her old mortgage, and use $2 million in leftover cash to pay Phleger's bills. But Edison instead used the money for a private jet, a boat docked in Malta, cars, and goods at Kmart, Foot Locker and other stores, according to court filings.

For more, see Con Man's Plea May Spare His Wife.

For earlier story announcing the indictment, see the San Francisco Chronicle: Man indicted in $2 million fraud.

Texas Man Faces Theft From Elderly Charge; Allegedly Conned Dementia-Suffering Widow Into Signing Away Deed To Home For Less Than 15% Of Value

In Houston, Texas, FOX 26 reports:

• Joseph Kelly Lecureux, 39, is charged with theft from the elderly; authorities are accusing him of trying to take advantage of an elderly widow whose home was on the verge of foreclosure. [...] According to Marian Rosen, [the homeowner's] attorney, the elderly widow was suffering from dementia when she signed the deed to her home over to Lecureux, selling it for less than 15 percent of it's value.

According to the FOX 26 video coverage, the widow's attorney filed a successful civil suit voiding the deed and restoring title to the home in the name of the widow. Sometime thereafter, local law enforcement authorities filed the criminal charges against Lecureux.

For more, see Man Faces Theft From Senior Charge (read story) (watch FOX 26 video report).

Go here, go here, and go here for other posts related to deed theft by forgery, swindle, etc.

Go here, here, here, here, here, and here for other posts on elder financial abuse. FinancialAbuseOfElderlyAlpha deed theft xenon

NJ Homeowners Claim Fraud In Sale Leaseback, Foreclosure Rescue Lawsuit; Pattern Of Activity Should Qualify As Racketeering, Says Attorney

In Central New Jersey, the Asbury Park Press reports:

• [Little Egg Harbor resident Michael] Moreno says he was stripped of nearly $70,000 in equity in the February 2006 [sale leaseback, foreclosure rescue] deal, and he faces eviction from the house he thought he saved. He also is one of two former homeowners suing [Robert] Heath and related companies in an attempt to undo deals they claim are fraudulent.(1) Their attorney, Kevin Carlin of Hamilton, said the documents on the deals list transactions that never happened, a violation of federal law. Carlin also said there are more than 40 similar real estate transactions involving Heath in the state. In the lawsuit, Carlin argues "the pattern" of activity should qualify as racketeering.

***

• Deborah and Lawrence Mayo of Brick also have joined the lawsuit against Heath, and they also claim there was a fraudulent transaction. Carlin said at least three other families have contacted him about allegedly bad deals with Heath's businesses. Two of those families already were evicted from their homes, Carlin said.

***

• "On paper it looks like a typical real estate transaction with a purchase and a sale, but when you look behind the paper — which is what courts of equity will do — what you see is that the transaction was actually the granting of an equitable mortgage; they were really just refinancing the property," Carlin said. "And they accomplished it by using an attorney who gave the appearance of a disinterested party while she was the wife of the principal [Heath]."

For more, see Eviction looming, man sues over deal (He, others say they feel cheated).

(1) According to the story, Heath's Marlboro-based company, MGT Group, would offer to sell the home back to Moreno at a later date.