Lawsuit: Timeshare Outfit Uses Foreclosure Threat In Attempt To Squeeze $276 In Late Fees Over "Missing Penny"

In Passaic County, New Jersey, Courthouse News Service reports:

• An attorney claims his Hawaiian timeshare company charged him $276 in late fees and threatened to foreclose on his property because he owed it a penny. Jonathan Dorman says the Kahana Beach Vacation Club subjected him to abuse and threats until he wrung from it the information that it was charging him 20 months of late fees for a penny - which a supervisor said "appeared to be the result of a computer glitch."

***

• He says he offered to pay the penny, but the accounts receivable rep refused to accept it, but "continued to verbally berate plaintiff," and said he "was on the phone to get plaintiff to the pay $276.77 that was past due." [...] Dorman seeks punitive damages for fraud and violations of the Fair Debt Collection Act. He filed the case pro se.

For more, see Lawyer Fights $276 in Late Fees & Foreclosure Threat, Over a Penny.

For the lawsuit, see Dorman v. Kahana Beach Vacation Club an Consolidated Resorts, Inc.

Pending NYS Law Targets Loan Modification Scams, Deed Ripoffs; Bill Awaits Governor's Sign-Off

In the Throgs Neck section of The Bronx, the New York Daily News reports:

• The bottom-feeders are back, but a bill on Gov. Paterson's desk could protect distressed Bronx homeowners from fraud. Two years after the subprime mortgage crisis imploded, unscrupulous loan modification consultants are still scamming homeowners like Angeleta Beckford.

• The 54-year-old coughed up more than $17,000 for consultants who promised to save her Throgs Neck home from foreclosure - not knowing she could have gotten free help from the state, said Senator Jeff Klein (D-Bronx, Westchester), the bill's sponsor.

• One firm took $400 per month from Beckford. Another persuaded her to sign over the deed and title to her home, she charged. "They scammed me," said Beckford. "I spent so much money. ... It's a nightmare."

• Many scammers have been charged with fraud in federal court. But other cold-blooded consultants continue to prey on Bronx homeowners, Klein said, by flooding their mailboxes with flyers that make false promises.

• The bill requires consultants to put a disclaimer on loan modification ads telling homeowners they can receive similar services for free through the New York State Banking Department.

For the story, see Home fraud shield law on Gov. Paterson's desk would fight loan scams.

Store Owner Suspects City Of Using Code Enforcement Rules To Take His Property, Squeeze Him Out Of Business

In Plantation, Florida, the South Florida Sun Sentinel reports:

• For the latest example of local government run amok, look no further than the small Farm Store owned by Nasir Ahmed on Peters Road in Plantation. It's a drive-through convenience store where people roll up to buy beer, cigarettes and milk.

• After nearly 15 years of ownership — after working hard, paying his taxes and paying off the mortgage — Ahmed might lose the store because of a city code-enforcement nightmare. What Ahmed says were minor violations have turned into a $156,700 fine and a foreclosure judgment.

• "I think the city wants this property," said Ahmed, 52, an immigrant from Bangladesh. "Ever since I paid off the mortgage, there's been problems."

***

• If the city wants this property for a public purpose, eminent domain allows government to take it by paying the owners fair market value. But this seems like a squeeze play to force Ahmed off the land.

For more, see Plantation store owner could lose property in code-enforcement nightmare (City gets foreclosure order after fine surpasses $150,000).

Would-Be Renter Out $1350 In Craigslist Rent Ripoff; Scammer Tricked Victim Into Transacting Bogus Deal Inside Bank Where He Claimed To Be Employed

In Sarasota, Florida, the Sarasota Herald Tribune reports:

• Nothing Betty Baker experienced after she replied to an ad on Craigslist for a $750-per-month apartment in June gave the single mother any reason to pause. The owner walked Baker through the spotless duplex, the paperwork was in perfect order. So she met the owner at the bank where he worked to sign the lease and hand over a $1,350 check for the deposit and rent.

• The check was cashed. Then, citing damage from a water leak, the owner postponed the move-in date several times. Then he stopped calling, and Baker could not find him. She returned to Synovus Bank on Main Street in Sarasota -- she had previously handed the man her money there -- and was given the bad news by an employee in the lobby.

• "He said, 'I hope you didn't give him any money because someone else was just there with the same story,'" Baker said. "That is the moment when my heart sank and I knew this guy just got me for nearly $1,400." The "owner" turned out to be anything but. He also was not a bank employee. The lease was bogus.

***

• Sarasota police identified the man who they say scammed Baker as Teddy Foster and discovered that he allegedly bilked two more people out of $1,000 on the same property in the same manner a month earlier. There is a warrant for his arrest.

• He is part of a fast-growing national scam tied closely to the foreclosure crisis and the Great Recession. The millions of vacant homes that have resulted are ready-made bait for stressed people looking for the cheapest rent possible. The prevalence of the swindle -- with endless variations that also can target the real owner or property manager -- is also a sign of scammers desperate for quick cash.

***

• The basic scam works this way: The fraudster finds a vacant home from the ranks of foreclosures, or via a legitimate for-rent advertisement, and places an ad on Craigslist for a below-average price. Included are various perks: all utilities included, or perhaps multiple pets allowed.

***

• Sarasota Police Det. Jack Carter had no complaints of online rental scams last year but already has had a dozen since January, three now in various stages of prosecution. The charge is a third-degree felony that carries with it the potential for five years in jail and a fine of up to $5,000.

• "The permutations are unbelievable," Carter said. "Sometimes the victims show up on the same day and say, 'I'm renting this place,' and the other says, 'No, I'm renting this place,' and the third says, 'No, I'm renting this place." The scammer often gets the renter off Craigslist but converses with them in other ways to avoid the site's roving online security teams looking for fraud. "They have gone as far as to get a transient to meet the renter at the house," Carter said. "They think the guy is a gardener or caretaker letting them into the house." The house in question has been broken into ahead of time and unlocked.

***

• Many law enforcement agencies in Southwest Florida say they have not received any complaints, but Julie LeLande, owner of Sarasota's LeLande Properties, said many cases she has dealt with have gone unreported. "None of the people I've talked to have reported it to the police," she said. "It is just so rampant."

For more, see Web-based scam snaring renters.

Homeowner Suffers Through Series Of Lock Outs As Lender Changes Door Hardware Seven Times After Falling 30 Days Behind On House Payments

In South Florida, WFOR-TV Channel 4 reported on local homeowner Xavier Bracco, and the recent problems with his mortgage lender:

• [L]ast fall, Bracco's dream turned into a nightmare."I felt as if like everything was coming down," said Bracco. When he got a pay cut, forcing him to miss one mortgage payment by only 30 days. He called the bank to tell them the news. "I said I'd be late 30 days," said Bracco."

• But in March after he came home from a business trip he found someone had broken into his house. "I came in and starting seeing my doors opened," said Bracco. It turns out, the people who were breaking in were sent from the bank that holds Bracco's mortgage. They were sent there to change the locks while Bracco was away on business. It apparently was a strong arm way of taking possession of the house.

• "For the first time in so many years I started to cry," said Bracco of those times. According to logs kept by the contractors hired by the bank which were left on Bracco's kitchen counter, every time Bracco changed the locks back and then went off on business the crew sent by the bank broke back into his house and changed the locks again. "I changed one set (of locks)," said Bracco. "And they changed the other set."

• They did that seven times. According to logs the crew signed and left behind the bank has changed the locks at least seven times and they kept doing it until Xavier Bracco finally hired a lawyer.(1)

Source: I-Team: Mortgage Help Not Helping.

(1) Earlier media reports reveal that at least one Massachusetts law firm is apparently going around the country taking on these illegal lockout cases on behalf of screwed-over homeowners. See:

• Bank admits mistake on Willcox home foreclosure (involving an Arizona homeowner) (for a copy of the resulting federal lawsuit, see Newman v. Bank of America, N.A. and go here for the attached Exhibits),

• Family's recently purchased home, gutted by property removal service (involving a Michigan homeowner) (for a copy of the resulting federal lawsuit and accompanying Exhibits , see Rought v Deutsche National Trust Company, Trustee, et al.).

For those homeowners who've been screwed over by wrongful lockouts by foreclosing lenders (and their confederates) and seek some possible guidance on how much their cases might be worth if they seek to sue, see:

• Nevada High Court OKs $1M+ Damage Award To Homeowner Due To Mortgage Company Misidentification Of Home In Foreclosure (for the court ruling, see Countrywide Home Loans v. Thitchener, 192 P.3d 243; 2008 Nev. LEXIS 79; 124 Nev. Adv. Rep. 64 (September 11, 2008)),

• Long Island Judge Hammers Wells w/ $155K Tab For Oppressive, Heavy Handed, Egregious Conduct For Pre-Sale Lockout Of Homeowner In Foreclosure (for the court ruling, see Wells Fargo v. Tyson, 2010 NY Slip Op 20079 (Sup. Ct., Suffolk County, March 5, 2010)).

Another Homeowner Who Never Missed A Payment Victimized By Wrongful Foreclosure Lock-Out; Bank Agent Admits Screw-Up

In Scottsdale, Arizona, KTVK-TV Channel 3 reports:

• The foreclosure crisis has forced thousands of Valley families out of their homes but a few days ago a Scottsdale woman got locked out of her home, which is not in foreclosure.

• Banks are hiring private companies to lock people out of their foreclosed homes but mistakes are being made due to more homeowners going into foreclosure. Cory Miller says she came home to her Scottsdale condo last week to find she had been locked out. Someone had put a lock box on her door and taped up a scribbled note which said they were given the address as a foreclosed property.

• Miller says, “I haven't missed a payment. Ever!" Miller says she called police thinking perhaps it was a scam or maybe she had been robbed. A Scottsdale police officer arrived to check things out and it turned out the whole thing was a mistake.

• The note on the door was signed by someone from Regis Development. Miller says she called them, explained they had the wrong house and they sent someone to fix her lock. The CEO of Regis Development admits to the mistake. The company is hired by banks to put lock boxes on foreclosed homes. Leo Loiacano admits, “Unfortunately when stuff like this happens, it's a serious nature. You're acting on behalf of a bank and if they send you to the wrong the spot you're in the wrong spot."

• Miller says the whole situation left her feeling unsettled. “If somebody told me yesterday that somebody can gain access to your home and lock you out I would’ve said ‘You're out of your mind there's no way’ but today I'm living it." 3TV spoke to attorneys and police about the matter and they all say there is no way to prevent this kind of thing from happening.(1)

Source: Scottsdale woman locked out of home due to foreclosure mistake.

(1) For a recent similar incident in Arizona, see BofA Bagged Again On Wrongful Foreclosure Attempt; Says It's Sorry For Action Against Couple With Paid-Off Loan After Local Media Steps In.

Earlier media reports reveal that at least one Massachusetts law firm is apparently going around the country taking on these illegal lockout cases on behalf of screwed-over homeowners. See:

• Bank admits mistake on Willcox home foreclosure (involving an Arizona homeowner) (for a copy of the resulting federal lawsuit, see Newman v. Bank of America, N.A. and go here for the attached Exhibits),
• Family's recently purchased home, gutted by property removal service (involving a Michigan homeowner) (for a copy of the resulting federal lawsuit and accompanying Exhibits , see Rought v Deutsche National Trust Company, Trustee, et al.).

For those homeowners who've been screwed over by wrongful lockouts by foreclosing lenders (and their confederates) and seek some possible guidance on how much their cases might be worth if they seek to sue, see:

• Nevada High Court OKs $1M+ Damage Award To Homeowner Due To Mortgage Company Misidentification Of Home In Foreclosure (for the court ruling, see Countrywide Home Loans v. Thitchener, 192 P.3d 243; 2008 Nev. LEXIS 79; 124 Nev. Adv. Rep. 64 (September 11, 2008)),

• Long Island Judge Hammers Wells w/ $155K Tab For Oppressive, Heavy Handed, Egregious Conduct For Pre-Sale Lockout Of Homeowner In Foreclosure (for the court ruling, see Wells Fargo v. Tyson, 2010 NY Slip Op 20079 (Sup. Ct., Suffolk County, March 5, 2010)).

Plea Deal Yields Prison Time For Mom, Daughter Duo In F'closure Rescue, Lease-To-Own Rent Skimming Scam Targeting Strapped Homeowners, Would-Be Buyers

In Bakersfield, California, the Bakersfield Californian reports:

• A mother and daughter will go to prison for their part in a real estate scam that cheated dozens of people out of 24 homes, a prosecutor said []. Alice Kantin,(1) also known as Meyer, 69, and her 38-year-old daughter, Dawn Kantin, pleaded no contest [] to felony charges that will put the mother in prison for two years and the daughter in prison for five years, Deputy District Attorney Gordon Isen said. [...] The Kantins will also be ordered to pay restitution in an amount to be determined, but it is unknown if they have any money to pay the victims, Isen said. The loss is a few million dollars, he said.

***

• Each were charged with 44 felonies of conspiracy, embezzlement, theft, notary fraud and forgery stemming from transactions between 2007 and 2009.

• Both women reportedly agreed to take over payments for distressed homeowners by using rents from people who had an option to buy the homes, investigation reports say. But in most cases, the homes went into foreclosure during a time the senior Kantin poured at least $290,000 into her bank account, the reports say. Both the homeowners and renters lost everything, the reports say.

For more, see Mother, daughter plead no contest to felonies in real estate scam.

(1) Reportedly, Alice Kantin operated from a firm called Desert Air Real Estate Investments Inc. in Bakersfield, according to court reports.

Participant In Alleged "King Solomon" Sovereign Movement, Home Hijacking Racket Targeting Vacant Foreclosed Homes Escapes Forgery-Related Convictions

A California Court of Appeals recently reversed all forgery-related convictions of Maurice Antoine Simmons, a participant in the alleged King Solomon II(1) (not to be confused with the original King Solomon of Biblical fame) home-snatching scam involving vacant foreclosed houses in the San Diego-area.(2)

The trial court, which originally sentenced Simmons to prison for two years eight months, now gets the case back for resentencing on the remaining convictions of filing a false instrument (six counts), conspiracy to file a false instrument (one count), and (this one's the biggie, folks!) driving with a suspended license (one count).(3)

Source: People v. Simmons, No. D056165 (Cal. App. 4th Dist. Div. 1, September 27, 2010).

(1) In footnote 2 of its ruling, the appeals court notes that King Solomon II prefers to use a copyright symbol at the end of his name (i.e., King Solomon II ©) and legally changed his name from Terry Lee Herron.

(2) The appeals court summarized Simmons' role in the scam as follows:

• In mid-2008, Simmons became acquainted with a man known as King Solomon II. Simmons paid $5,000 to King Solomon II so that he could learn about the concepts of "sovereignty" and "common law," on which King Solomon II purports to be an expert.

• While being mentored by King Solomon II, Simmons came to believe that he could become a sovereign by surrendering his birth certificate to the chairman of the Federal Deposit Insurance Corporation, among other things, and that under his sovereign status he could claim abandoned real estate as his own, even if the real estate was bank owned pursuant to a foreclosure process.

• According to Simmons, the process of obtaining ownership of abandoned properties under the concepts of "sovereignty" and "common law" involved posting a notice on the properties or on a courthouse bulletin board, and then — after waiting 30 days — recording a grant deed on the property, changing the locks, turning on the utilities, and removing the mailbox and the street numbers from the property.

• In October 2008, Simmons, with the participation of King Solomon II, caused grant deeds to be recorded in the San Diego County Recorder's office for six properties. Specifically, each grant deed stated that Simmons was conveying the property at issue to Sovereign Solomon Brothers Archbishop Corporation Sole, which is a Nevada corporation created by King Solomon II. The grant deeds were signed by Simmons and notarized.

• Simmons did not have the ability to convey the properties because he did not own any of them. Three were owned by banks after having been acquired through a foreclosure process. Three were owned by individuals.

• However, the county recorder's office does not determine whether a grant deed presented for recording is a valid legal document. It looks only for recordability. As the six grant deeds met the technical requirements, they were recorded, and Simmons began to take possession of the properties. According to Simmons, he and King Solomon II planned to turn the properties into "sanctuaries" for homeless families.

(3) For earlier posts on the alleged King Solomon II, sovereign movement home-snatching racket, see:

• California Man Gets 32 Months For Filing Phony Deeds To Illegally Claim Title To Homes In Foreclosure,
• California Man Says "Prove It" To Multiple San Diego-Area Mansion-Stealing, Deed Theft Allegations; Local Authorities Notice Phony Deed Filing Trend.

Lender's Foreclosure Attempt Of Alleged Predatory Loan To 75-Year Old Widow Hits Roadblock As C. Florida Non-Profit Law Firm Steps In, Files Suit

In Sarasota, Florida, the Sarasota Herald Tribune reports:

• Mildred McClendon's troubles with a small second mortgage show just how quickly people caught up in predatory home loans can find themselves on the verge of losing their home. The 75-year-old Sarasota widow, her attorneys say, was granted a second mortgage that was written up illegally, and the lender then tried to foreclose, even though McClendon continued to make her monthly payments.

• Along the way, they say she was also charged bogus late fees and penalties, and in just the past 10 months the mortgage company doubled the amount McClendon is said to owe -- from $8,000 to $16,000. Then the firm then offered a settlement agreement that would allow it to take her $55,000 home of 40 years if she missed just one payment.(1)

• A local legal aid group has helped McClendon file a lawsuit against Nationstar Mortgage in Texas. It is the first of many lawsuits Gulfcoast Legal Services(2) expects to file to make mortgage companies and collection agencies treat troubled Southwest Florida homeowners more fairly.

• McClendon's case has so many loan irregularities on such a small amount owed that Gulfcoast Legal attorney Elizabeth Boyle is optimistic McClendon will not owe anything after her lawsuit goes through the courts. "It's rare that this relatively early in the case we would have so much evidence of wrongdoing," Boyle said.

***

• The lawsuit is related to others Gulfcoast Legal Services plans to file on behalf of troubled homeowners who made mortgage payments for months on modified mortgages only to have the lender file a foreclosure anyway.

For more, see Second loan turns into a foreclosure nightmare.

(1) Go here for more on The Predatory Nature of Home Loan Modifications.

(2) Gulfcoast Legal Services is a Central Florida-based non-profit corporation providing free legal aid to income eligible residents of the greater Tampa Bay area, having offices in Pinellas, Manatee, Sarasota and Hillsborough Counties.

DOCX Foreclosure "Document Fabrication" Price Sheet?

4closurefraud.org has an interesting post on the DOCX’s GetNet™ Document Recovery solution, which DOCX describes in its promotional literature as:

• "[a] national network of runners that is engaged to provide document recovery, expedited recordation services, title searches, and insurance submissions.

DOCX claims in its promotional literature that:

• "The service is unique in that our clients can request that DOCX obtain any missing recordable documents through this web site through our online GetNet™ Work Order Form. Status of existing projects can also be obtained through our Online Services."

For more on this document retrieval service, including the DOCX price sheet (in downloadable form, ready for easy distribution to foreclosure defense attorneys, government investigators, journalists, members of Congress, consumer advocates, homeowners, and any other interested persons), see Psst. Hey you, yea, you. I got just what you need. Lender Processing Services’ DOCX Document Fabrication Price Sheet.

1st Time Homebuyers May Be Out Thousand$ In Tax Credits Due To Stalled Closings Resulting From Recent 'Robo-Signer' Mess

HousingWire reports:

• Homebuyers who were set to close on the purchase of a foreclosed home may not qualify now for the homebuyer tax credit after lenders suspended those sales in 23 states, real estate agents tell HousingWire. The closing deadline for the homebuyer tax credit was extended earlier in the year from July 30 to Sept. 30 in order to make sure more first-time buyers received the $8,000 credit. Existing homeowners were set to get $6,500.

***

• "There are brokers who were at the closing table, with their buyers, and GMAC (Ally) pulled the carpet out from underneath them. Can you imagine the lawsuits they are going to have, for the people expecting the tax credit, which had to transfer title by Sept. 30?" one REO broker told HousingWire.

For more, see Foreclosure robo-signers put homebuyers' tax credit at risk.

Fresno Feds: Duo Pocketed Bank Loan Proceeds While Simultaneously Conning High-Equity Elderly Home Sellers Into Owner Finance, Equity Stripping Ripoff

In Fresno, California, The Sacramento Bee reports:

• The founder and longtime owner of Century 21 Apollo real estate was arrested Friday and charged with defrauding banks and elderly homeowners of more than $10 million. Jim Lankford, 71, and his roommate, Jon McDade, 46, bilked seniors and lenders for 11 years, according to a federal grand jury indictment [].

***

• Authorities say the men targeted seniors who owned homes free and clear and ran schemes that enriched the two with multiple loans on each property. Some homes were sold in short sales with Lankford's firm reaping commissions or lost to foreclosure, the indictment says.

• "Lending institutions did not know the loans they were extending were going to purchase property for which there was seller-backed financing, and sellers who agreed to finance the purchases did not know that the defendants had [simultaneously] obtained loans from lending institutions to purchase the properties," the document reads.

• In some cases, Lankford filed deeds with forged signatures or deceived elderly owners into signing away their homes "by telling them it had another legal purpose," authorities allege.

***

• Authorities previously said Lankford was the mastermind behind erasing a $22,400 loan by filing a document in 1999 -- "signed" by a woman who had died in 1995. He faced six felony charges, but a judge threw them out because investigators discovered the alleged crime after the statute of limitations had expired.

For the story, see Feds indict Modesto men in real estate scheme.

For the U.S. Attorney (Sacramento/Fresno) press release, see Modesto Century 21-Apollo Realty Owner Charged With Defrauding Elderly Homeowners ($10 Million in Losses Alleged):

• The indictment alleges that the defendants would divert the proceeds of the mortgage loan to themselves, and would lull the elderly property owners by mailing them monthly interest-only payments.

For the indictment, see U.S. v. Lankford, et ano.

Schwarzenegger Signs Bill Targeting Forensic Loan Audit Ripoffs

In Sacramento, California, The Sacramento Bee reports:

• California homeowners could get protection from "foreclosure-relief" scams under a bill signed into law by Gov. Arnold Schwarzenegger. Assemblyman Ted Lieu, D-Torrance, said his measure targets so-called forensic loan audits, where homeowners paid upfront fees, purportedly to determine their lender's compliance with state and federal mortgage laws.

For the story, see New state law targets mortgage relief scams.

Atlanta-Area Law Enforcement Probes Alleged Loan Modification Racket Accused Of Ripping Off Thousand$ From Financially Strapped Homeowners

In Atlanta, Georgia, WGCL-TV Channel 46 reports:

• A CBS Atlanta exclusive investigation has exposed a local company victimizing people who are trying to lower their home and car loans. CBS Atlanta has spoken with dozens of families who say they've been devastated by one man who's profiting off their misfortune.

• Fred Lee, an agent with Matrix Capital, has been served with a cease-and-desist order in Georgia and he is under investigation by the DeKalb County Police Department, but you'd never know it. His business is booming and the number of victims is growing.

***

• Lee and his company, Matrix Capital, sell people the promise of a loan modification for $1,500 up front. He said he'll get you a lower interest rate, and while he's negotiating, you don't have to make a payment. You can live mortgage free. And people have believed him. He holds packed meetings across the Southeast, luring in new clients. [...] But his victims say they were never told their homes might go into foreclosure. And no one we spoke with had a successful modification through Lee.

***

• DeKalb County Police now tell us they have also launched an investigation into Fredrick Lee's company. They started investigating Lee four months ago when 30 victims stepped forward to police to tell them the same story. "Essentially it is a theft, a fraud,"(1) Sgt. John Germano said.

• Germano told us Lee has been skirting the law, moving from state to state,(2) changing his company name, and preying on people in dire financial situations. In fact, CBS Atlanta News found out in 2007 the Georgia Department of Banking and Finance issued Lee a cease and desist letter ordering him to stop brokering mortgages in Georgia. "That company changed names, but continued to do business," Germano said.

***

• If you have information on Fred Lee or Matrix Capital, please email [CBS Atlanta Wendy Saltzman] at wendy.saltzman@cbsatlanta.com. You can also contact the DeKalb County Police Fraud Unit at 770-724-7704.

For the story, see Company Promises Lower Mortgage Payments (Lands Clients In Foreclosure).

(1) Georgia law enforcement authorities recently charged another alleged loan modification scammer with racketeering and theft by deception (see Self-Proclaimed Minister Faces Racketeering, Theft By Deception Charges For Allegedly Ripping Off Homeowners By Peddling Bogus Loan Modifications).

(2) According to the report, Lee was busted in Maryland doing the same thing. Another cease and desist order was issued there, but police say Lee has worked his way around the system and around the country making the same sales pitch. Reportedly, Lee also applied for and got a mortgage license in North Carolina in 2002, but his license was later revoked. Lee was said to have been sued over loans he brokered in Virginia.

Customers Claim Forensic Loan Audit Outfit Left Them Out Thousand$ & Homeless

In Rancho Cordova, California, KOVR-TV Channel 13 reports on companies U.S. Loan Auditors and My U.S. Legal, two firms who have been accused by disgruntled clients of ripping them off out of thousands of dollars by claiming to perform forensic loan audits on their home loan documents, purportedly in an effort to avoid foreclosure.

For the story, see Call Kurtis Investigates: U.S. Loan Auditors (Families Say The Company Took Thousands; They Ended Up Homeless).

Maine Residents File Class Action Suit In Effort To Hold Lender Accountable For Allegedly "Routinely & Systematically" Using False F'closure Documents

In Biddleford, Maine, the Molleur Law Office announces:

• Five Maine residents filed a complaint(1) today [Oct 1, 2010] against GMAC Mortgage, LLC ("GMAC") on behalf of themselves and a class of Maine homeowners alleging that the company routinely and systematically files false certifications that it has a right to foreclose on Maine homeowners, and false affidavits when asking courts to enter foreclosure judgments.

***

• The Maine residents are represented by Andrea Bopp Stark from the Molleur Law Office in Biddeford, Maine; Thomas Cox(2) coordinator of Maine Attorneys Saving Homes in Portland; the National Consumer Law Center and the Center for Responsible Lending.

For more, see Molleur Law Files Class Action Complaint Against GMAC.

(1) For the GMAC Maine Class Action Lawsuit and related documents, see:

• Archibald, et. al. v. GMAC Mortgage, LLC.,
• Exhibits 1 - 4,
• Exhibits 5 - 25,
• 2009 Deposition of Jeffrey Stephan,
• 2010 Deposition of Jeffrey Stephan.

(2) Mr. Cox, an attorney who reportedly has retired from the practice of law but apparently has yet to leave the "playing field" (see Retired Maine Attorney Joins Fight Against Foreclosures; Volunteers Services With Local Legal Aid Program), successfully represented a homeowner facing foreclosure as co-counsel in a case decided by the Maine Supreme Court in August. Based on the facts in that case, the Maine high court found that MERS was not a "mortgagee" within the meaning of the state's foreclosure statute, 14 M.R.S. §§ 6321-6325, and therefore had no standing to institute foreclosure proceedings. See Mortgage Electronic Registration Systems, Inc. v. Saunders, et al., 2010 ME 79 (August 12, 2010).

Mortgage Loan Servicing's 'Dirty Dozen'

In West Palm Beach, Florida, Fraud Digest reports:

• On September 28, 2010, Fraud Digest released its list of the Dirty Dozen - the mortgage servicing companies most responsible (in the opinion of Fraud Digest) for flooding courts with millions of fraudulent mortgage assignments and Affidavits in foreclosure cases. Robo-signing (preparing over 10,000 sworn statements each month with no actual knowledge of the truth of the matters asserted) was certainly not limited to Jeffrey Stephan and GMAC Mortgage.(1)

Go here for Fraud Digest's Dirty Dozen.

Thanks to Deontos .is for the heads up on the Dirty Dozen list.

(1) Recent Fraud Digest reports cite the work of some of the more seemingly notorious "multiple corporate hat-wearing vice presidents" (also commonly referred to as "robo-signers" and "affidavit slaves") around the country that no doubt appear to have played significant roles in the creation of the "flood" of dubious documents currently clogging the courts (linked names below contain additional information on each):

September 30, 2010 report:

• To assist JPMorgan Chase, Fraud Digest suggests that it dismiss those actions where the Affidavits or Mortgage Assignments were signed by the following robo-signers: Beth Cottrell, Whitney Cook, Christina Trowbridge and Stacy Spohn from the Chase Home Finance office in Franklin County, OH; Margaret Dalton and Barbara Hindman from the Jacksonville, FL office of JPMorgan Chase; and any of the Lender Processing Services robo-signers from the Dakota County, MN office including Christina Allen, Liquenda Allotey, Christine Anderson, Alfonzo Greene, Laura Hescott, Bethany Hood, Cecelia Knox, Topako Love, Jodi Sobotta, Eric Tate, Amy Weis and Rick Wilken.

September 29, 2010 report:

• On September 29, 2010, another "Corrective Assignment" came to light, filed by the Florda law firm of Shapiro & Fishman. (See Corrective Assignment #2 in the Pleadings Section of Fraud Digest.) Like the first Corrective Assignment, a statement appears in bold that the new Assignment was filed because Linda Green [go here for even more on Linda Green], now infamous robo-signer from Lender Processing Services in Fulton County, GA, did not have authority to sign as an officer of Mortgage Electronic Registration Systems (MERS) when she signed the first Assignment.

September 23, 2010 report:

• China Brown has been employed for many years in the Ft. Mill, SC offices of America's Servicing Company, a division of Wells Fargo Bank, N.A. She signed many different job titles on mortgage-related documents, often using different titles on the same day. She often signs as an officer of MERS ("Mortgage Electronic Registration Systems, Inc.") On many Mortgage Assignments signed by China Brown, Wells Fargo, or the trust serviced by ASC, is shown as acquiring the mortgage weeks or even months AFTER the foreclosure action is filed. Titles attributed to China Brown include the following: Assistant Secretary, MERS, as Nominee for 1st Continental Mortgage Corporation; Assistant Secretary, MERS, as Nominee for American Brokers Conduit; Assistant Secretary, MERS, as Nominee for American Financial Resources, Inc.; Assistant Secretary, MERS, as Nominee for Amtrust Bank; Assistant Secretary, MERS, as Nominee for DSKL Enterprises, Inc. dba Mortgage Masters of the Treasure Coast; Assistant Secretary, MERS, as Nominee for First Magnus Financial Corp., an Arizona Corp.; Assistant Secretary, MERS, as Nominee for Guaranty Bank; Assistant Secretary, MERS, as Nominee for Impac Funding Corporation; Assistant Secretary, MERS, as Nominee for Ivanhoe Financial, Inc., a Delaware Corp.; Assistant Secretary, MERS, as Nominee for Lenders Direct Capital Corp.; Assistant Secretary, MERS, as Nominee for RBC Mortgage Company; Assistant Secretary, MERS, as Nominee for Shelter Mortgage Company, LLC; and Vice President of Loan Documentation, Deutsche Bank National Trust Company, as Trustee for First Franklin Mortgage Loan Trust 2006-FF11, by Wells Fargo Bank, N.A., as Attorney-in-Fact.

September 21, 2010 report:

• Tywanna Thomas was employed for many years in the Alpharetta, GA offices of Lender Processing Services. She signed many different job titles on mortgage-related documents, often using different titles on the same day. She often signed as an officer of MERS ("Mortgage Electronic Registration Systems, Inc.") There are at least four distinct versions of the Tywanna Thomas signature, indicating that several different persons signed the name “Tywanna Thomas.” Titles attributed to Tywanna Thomas include the following: [click here for the list of at least 20 "corporate hats" allegedly worn by Tywanna Thomas].

September 20, 2010 report:

• In thousands of cases, [Jeffrey] Stephan signed as an officer of many different banks and mortgage companies, including [lists approximately 20 job titles]. [...] Stephan often signed as an officer of mortgage companies that had filed for bankruptcy or dissolved. (Go here and go here for more on Jeffrey Stephan).

September 20, 2010 report:

• Kathy Smith has been employed for several years in the Jacksonville, FL (Duval County) offices of Lender Processing Services, Inc. She signs many different job titles on mortgage-related documents, often using different titles on the same day. She often signed as an officer of MERS ("Mortgage Electronic Registration Systems, Inc.") She often signs documents with other LPS-Jacksonville employees including Alisa Dhimitri, Theresa Esposito, Michelle Halyard, Michael Hunt, Joseph Kaminski and Cynthia Stevens. Titles attributed to Kathy Smith include the following: [lists 7 titles ].

September 19, 2010 report:

• Denise Bailey has been employed for several years in the Houston, TX (Harris County) offices of Litton Loan Servicing, LP. She signs many different job titles on mortgage-related documents, often using different titles on the same day. [...] She often signs documents with other Litton Loan Servicing employees Diane Dixon and Marti Noriega. She often does not disclose that she is working for Litton Loan Servicing and signs to assign mortgages TO Litton Loan Servicing or its client trusts. [...] Titles attributed to Denise Bailey include the following: [lists 5 titles].

September 16, 2010 report:

• Jessica Ohde was employed for many years in the Alpharetta, GA offices of Lender Processing Services. She signed many different job titles on mortgage-related documents, often using different titles on the same day. She often signed as an officer of MERS ("Mortgage Electronic Registration Systems, Inc.") There are at least four distinct versions of the Jessica Ohde signature, indicating that several different persons signed the name “Jessica Ohde.” Titles attributed to Jessica Ohde include the following: [lists six titles].

Purported Forensic Loan Auditor Impersonating Lawyer Peddling Foreclosure Rescue Services Gets Year In Jail, 5 Years Probation, $35K Restitution Order

In Marin County, California, the Contra Costa Times reports:

• A loan auditor who impersonated a Mill Valley lawyer in a foreclosure scam was sentenced to a year in jail []. Nicolas Moscouplos, 54, of Sacramento was also ordered to pay restitution to the victims, said Deputy District Attorney Leon Kousharian. The restitution amount is approximately $35,000, said Moscouplos' public defender, Michael Schroettner.

***

• The case began in May after the Mill Valley lawyer, Mohamed Salem, contacted the sheriff's department to report that someone had opened an Internet site using his name. The website, www.canwinforeclosure. com, appeared to offer Salem's legal services in helping residents fend off foreclosure actions. Salem reported that he became aware of the site after receiving complaints from lawyers regarding paid services that were not being provided.

***

• Investigators identified at least 12 victims. Moscouplos eventually pleaded guilty as charged to false impersonation and identity theft. He was sentenced by Judge Kelly Simmons in Marin Superior Court. The judge also sentenced Moscouplos to five years of probation.

For the story, see Scammer sentenced for impersonating Mill Valley lawyer.

Plea Negotiations Tank In Criminal Prosecution Of Loan Modification Pair; Michigan AG's Office Ready To Go To Trial

In Brighton, Michigan, WHMI Radio 93.5 FM reports:

• Two employees of a Howell mortgage company charged with violating foreclosure rescue regulations are heading to trial. Michelle Garbuschewki of Howell, also known as Michelle Justice, along with Lisa Joboulian of Northville are charged with violating the Credit Services Protection Act.

• The pair, who worked for Elite Mortgage, were in 53rd District Court in Brighton [] for a scheduled plea hearing but nothing was worked out and the case was adjourned. A spokeswoman from the Michigan Attorney General’s Office says negotiations have broken down and they are now waiting for a trial date to be scheduled.

• The terms of any offered details have not been revealed but the state is seeking restitution — estimated at more than $25,000 — for all eight complainants. Garbuschewski previously admitted to WHMI that she and Joboulian had taken money up front from customers facing foreclosure, but said she thought the law applied only to mortgage companies, not loan-modification companies like Elite Mortgage, which has since closed its doors. The Attorney General’s office says they received eight complaints against Garbuschewski, Joboulian and Elite Mortgage, although only two complaints are included in the current charges.

Source: Plea Negotiations Break Down In Foreclosure Violation Case.

Self-Proclaimed Minister Faces Racketeering, Theft By Deception Charges For Allegedly Ripping Off Homeowners By Peddling Bogus Loan Modifications

In Atlanta, Georgia, MyFox Atlanta Channel 5 reports:

• The FOX 5 I-Team has the exclusive video of the arrest [last week] of a self-proclaimed minister who police say took more than $100,000 from his most recent victims. An I-Team investigation caught the man on hidden camera offering to save people's homes from foreclosure, even after the state had warned him to stop.

• The man spent time in federal prison for fraud and when he got out of prison and settled in Metro Atlanta to start another business, which the state told him was illegal. That same man was warned a second time by the state to stop. Then, after an I-Team hidden camera investigation he was raided by local police. What did he do? Police say opened up shop again.

For more, see I-Team: Trinity Arrest.

See Media Report Probes Into Minister's Activities Involving Dubious Loan Modification Services, for more on Trinity Corporation's 'Uncle' Mike Surgent, the self-proclaimed minister bagged by the cops for allegedly ripping off homeowners by peddling bogus loan modifications.

Forensic Loan Audits "Had No Value" Admits Soon-To-Be Booted Attorney As State Bar Continues "Historic" Effort In Slamming Bogus Loan Mod Lawyers

In Los Angeles, California, Metropolitan News Enterprise reports:

• The State Bar of California said [] that Orange County attorney Mark Alan Shoemaker has agreed to be disbarred for loan modification misconduct. Shoemaker, 50, did so as a result of complaints from 18 homeowners who received little or nothing for their money when seeking help in trying to change the terms of their mortgage and avoid foreclosure, the State Bar said.(1) He is the sixth lawyer to agree to disbarment since the group created its Loan Modification Task Force in April 2009.(2)

***

• The State Bar said that Shoemaker, as president of Advocate For Fair Lending, promised homeowners “trapped in their mortgages” that his company could “reduce your payments, interest and balance without refinancing your home.” Clients paid a minimum $1,000 a month for three months for the company’s services.

• The company promised to audit loan documents, which, Shoemaker said in a stipulation letter, “had no value to clients.” Demand letters were sent to lenders and when they didn’t respond, AFFL said the client would need an attorney for an additional fee.(3)

For more, see Sixth Attorney Agrees to Disbarment for Loan Modification Misconduct.

See Another Lawyer Agrees To Disbarment For Loan Modification Activities for the State Bar of California press release.

(1) Shoemaker's reportedly admitted State Bar violations include:

• knowing or being “grossly negligent in not knowing” employees who were not lawyers were giving legal advice,
• failed to perform legal services competently,
• failed to refund unearned fees (see footnote 3, below),
• inadequately communicated with clients,
• failed to account for advanced fees and costs,
• charged an unconscionable fee,
• failed to deposit funds in a client trust account, and
• aided a non-attorney in the practice of law,

(2) “What the State Bar discipline system is doing to lawyers engaged in loan modification misconduct is historic,” State Bar Chief Trial Counsel James Towery reportedly said. “The [State Bar] has never so aggressively gone after a group of attorneys for misconduct.” Towery reportedly described as “remarkable” the results of State Bar prosecutors working to stop foreclosure-related unethical behavior. According to the story, in addition to the six disbarments, the State Bar’s Loan Modification Task Force has obtained 12 resignations of attorneys involved in loan modification misconduct. Six trials are pending, another 1,800 active investigations related to loan modification are underway, and more than 4,000 complaints have come through the task force since it was formed, the story states.

(3) Homeowners ripped off by the dishonest conduct of a California attorney (including a failure to refund unearned legal fees) who want to recover their money can apply for possible restitution from the Client Security Fund of the State Bar of California (up to $100,000 if the screwing over occurred on or after January 1, 2009; up to $50,000 is reimbursable if the dirty deed(s) occurred before January 1, 2009. See also Can the Client Security Fund Help You?).

For earlier posts referencing California's Client Security Fund in the context of loan modification ripoffs, see:

• Thousands Of Distressed Homeowners Left Hanging After Attorney Abruptly Chucks Law License; Calif. State Bar Urges Victims To File Restitution Claims,
• Calif. State Bar Probers Have Hands Full With Loan Mod Ripoff Complaints; 1200 Probes Pending; Attorney Scams Begin To Drain Client Security Fund.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (list now includes Canadian protection funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

State Bar Of California Clobbers Another Rogue Member For Involvement In Loan Mod Ripoffs; Usually Never Met Clients In Possible Lawyer-Renting Racket

In Los Angeles, California, Metropolitan News Enterprise reports:

• Orange County attorney Brian Colombana, who handled dozens of foreclosure cases, has admitted extensive misconduct that will lead to his disbarment, the State Bar of California said []. [...] He becomes the fifth attorney to agree to disbarment in the wake of complaints by homeowners who paid fees to lawyers the State Bar says did little or nothing to help them.

***

• According to the State Bar, Colombana, who practiced in Laguna Hills, accepted nearly $36,000 in fees from 12 distressed homeowners, but did not obtain a single loan modification. Eight of the clients live in states where Colombana is not licensed to practice, and he admitted to engaging “in a scheme to defraud these clients, by exploiting them for personal gain and accepting employment where he was not licensed to practice law.”(1)(2)(3)

For more, see Lawyer Faces Disbarment for Misconduct, State Bar Says.

See Another Lawyer Agrees To Disbarment For Loan Modification Activities for the State Bar of California press release.

(1) Reportedly, two of Colombana’s clients lost their homes to foreclosure, one had to sell his home at a loss and another cashed in insurance policies to bring the mortgage current and avoid foreclosure. Colombana, 29, affiliated with several loan modification companies, including Loan Negotiators of America, Housing Law Center and Mortgage Relief Law Center, and in most cases, he never met his clients, the story states.

No word in the story on whether law enforcement authorities are considering whether criminal theft by deception charges are applicable in this case.

(2) Online rumor has it that Colmbana may be back in the troubled mortgage business, peddling reports to help people know if they meet the federal guidelines for the HAMP program. See NPV Report. Brian Colombana is Back in the Mortgage Modification Business. This Time With a Report. In related posts, see:

• Liberty Law Firm in California. Is It Brian Colombana, Esq. or American Financial Modifications?,
• Liberty Law Firm – Scam, Complaint, Review, or Praise?

(3) Homeowners ripped off by the dishonest conduct of a California attorney (including a failure to refund unearned legal fees) who want to recover their money can apply for possible restitution from the Client Security Fund of the State Bar of California (see also Can the Client Security Fund Help You?).

For earlier posts referencing California's Client Security Fund in the context of loan modification ripoffs, see:

• Thousands Of Distressed Homeowners Left Hanging After Attorney Abruptly Chucks Law License; Calif. State Bar Urges Victims To File Restitution Claims,
  Calif. State Bar Probers Have Hands Full With Loan Mod Ripoff Complaints; 1200 Probes Pending; Attorney Scams Begin To Drain Client Security Fund.

For similar "attorney ripoff reimbursement funds" that sometimes help cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:

• Directory Of Lawyers' Funds For Client Protection (list now includes Canadian protection funds, courtesy of the American Bar Association);
• Check the USA Client Protection Funds Map;
• Check the Canada Client Protection Funds Map.

Central Florida's "Hang 'Em High, Harry" Ready To Wield Heavy Gavel To Hammer Sloppy Foreclosure Mills Unable To Follow Simple Court Rules

In Sarasota, Florida, the Sarasota Herald Tribune reports:

• Criminal defense attorneys used to call Judge Harry Rapkin "Hang 'Em High Harry" for his tough prison sentences, and his latest crackdown in foreclosure court might have home lenders trying to come up with a similar nickname.

• Rapkin unleashed a new order last week, aimed at attorneys for lenders who are still making the kind of simple errors that would be considered ridiculous in any courtroom. A lot is at stake; Rapkin sees hundreds of cases where the lender is minutes away from taking someone's property. Rapkin's new order completely dismisses foreclosure cases when they do not follow the simplest of rules.

***

• "This isn't brain surgery," said Sarasota attorney Michael Belle, who reviews foreclosure filings for the judges as part of a court-sponsored program. On Sept. 24, the day Rapkin debuted the order, a quarter of the 250 cases seeking his permission to retake property made one of the errors, 61 in all.

• Rapkin's checkboxes [listing the most common mistakes he sees in foreclosures] give him a quick way to make rulings on the cases. But it also has a twinge of ridicule: as in, can you believe professional attorneys can get things this wrong? Belle said it is a sad commentary about how a judge feels he must hold the hand of these attorneys just to meet elementary standards. "Judge Rapkin is now finally saying I can't trust these guys anymore, so here's what I'm going to do," Belle said.

For more, see Sarasota judge simplifies foreclosure cases (COURTROOM: A checklist of filing errors can bring a case to a halt).

Fort Lauderdale-Area Court System Not Immune To 'Kangaroo-Itis' In Foreclosure Actions As Local Chief Judge Takes "See No Evil, Hear No Evil" Posture

In Fort Lauderdale, Florida, WFOR-TV Channel 4 ran a story that made the following reference to the goings-on at the local county courthouse in connection with foreclosure actions that, to some, may appear to be a rubber-stamping kangaroo court system, and where the local chief judge is seemingly taking his cues from Mizaru, Kikazaru, and Iwazaru, better known as the proverbial "Three Wise Monkeys":

• If there's any question about how bad the mortgage foreclosure crisis is, all you need to do is sit in on special courts like the one in Broward County. They do nothing but handle mortgage foreclosure cases using retired judges paid by the state of Florida. The special foreclosure courts were set up by the state in July with $9.6 million in seed money to try to reduce the backlog of some 67,000 foreclosure cases statewide.

• In Broward County, the I-Team found the line of lawyers handling these cases stretching out the door and some cases before a judge lasting mere minutes to close. "We're under a mandate from the legislature to track the cases," said the Honorable Victor Tobin. Judge Tobin heads Broward County's special foreclosure court and oversees its operations. "We're under the gun to move 62% of those cases (off the docket) in one year," said Judge Tobin.

• Though the retired judges preside over as many as 600 to 700 cases a week, Judge Tobin disagrees with those who charge that the cases are rushed through. "There is no pressure on that judge in the contested docket to move the cases in any particular fashion," said Judge Tobin. "You take your time, give everybody a hearing, be sure they're heard, listen to the arguments and (then) rule (in the case on the merits.)"

• But critics, such as [local foreclosure defense attorney Roy] Oppenheim, say that pressure to clear the calendar and move the cases has resulted in rushed judgments, sloppy judicial decisions and even cases of judges overlooking forged or unverified documents such as unverified bank notes and mortgages.

• "The banks effectively, in my opinion, hijacked the judicial system where the judicial system to a large extent became a private collection agency for the banking industry," said Oppenheim. Oppenheim calls these special foreclosure courts "rocket dockets" And he says homeowners get burned when judges more often than not side with banks at times without even seeing or reading evidence presented by the homeowner.

• "These (unverified) affidavits these judges have known have had problems for well over a year and allowed these to steam roll through," said Oppenheim. "And not fulfill, in my opinion, their constitutional oath of office as judges. In terms of protecting and upholding both the United States Constitution and the Florida Constitution in terms of protecting the Constitutional rights, the property rights of homeowners and citizens of this state."

• Judge Tobin disagrees."They (the judges) are under no edict to side with the bank as opposed to the homeowner," said Judge Tobin. Judge Tobin admits mistakes get made but he defends the system of specialized foreclosure courts. "You can't look at 50,000 cases…and not have a problem in individual cases," said Judge Tobin. "I haven't really seen it here in the 17th (Judicial Circuit.) I know they've had (problems or) issues have been raised in other jurisdictions. I know the (Florida) Attorney General is looking at the issue. We haven't really had it. But that doesn't mean that it's not there."

• In fact, the problem of fraudulent court documents is so bad Florida's Attorney General has now opened a criminal investigation.

Source: I-Team: Mortgage Help Not Helping.

In a related column, see Naked Capitalism: Florida’s Kangaroo Foreclosure Courts: Judges Denying Due Process on Behalf of Banks.

Mass. AG Begins Probe Into Mortgage Lenders Over Foreclosure Irregularities; Asks Them To Stop Actions Until They Can Show State Law Was Complied With

In Boston, Massachusetts, The Boston Globe reports:

• Attorney General Martha Coakley said yesterday that her office is investigating Bank of America and other creditors for their possible failure to follow state foreclosure laws, and she asked the lenders to put a temporary freeze on foreclosure proceedings in Massachusetts.

• “We are concerned about revelations that Bank of America and other major lenders have failed to properly review foreclosure documentation,’’ Coakley said in a statement. "In light of these revelations, we are asking Bank of America and other major creditors to cease foreclosure proceedings for Massachusetts homeowners until they can demonstrate that they have complied with Massachusetts law.’’

For more, see Coakley is investigating Bank of America, others.

The Ghosts Of The Dearly Departed WAMU, Lehman Brothers Continue Cranking Out Foreclosure Docs?

Shelter Island, New York attorney Abigail Field writes in AOL's DailyFinance:

• GMAC, JPMorgan Chase and Bank of America and One West Bank employees routinely sign hundreds of documents without verifying what they're signing. Those documents are then submitted to courts as if the documents were true, to enable the banks to foreclose on delinquent properties. Wells Fargo and CitiMortgage told the New York Times their employees do not engage in similar practices. Yet new evidence I've found shows they have. At deadline, I was still awaiting response from the banks.

***

• For example, in one case I reviewed, Herman John Kennerty of Wells Fargo gave a deposition describing the department he oversees for Wells Fargo. It's a department dedicated to simply signing documents. Kennerty testified that he signs 50 to 150 documents a day, verifying only the date on each.

• What else might he want to verify? Well, in one document he signed that I've reviewed, he supposedly transferred the mortgage from Washington Mutual Bank FA to Wells Fargo on July 12, 2010. But that's impossible, since Washington Mutual Bank FA changed its name in 2004, and by any name WaMu ceased to exist in 2008, when the FDIC took it over.

***

• In a similar example, one M. Matthews signed a number of documents that CitiMortgage has used to try to foreclose on properties. While Matthews may or may not sign hundreds of documents a day -- I have not yet found a deposition in which he swears that he does -- he certainly does not seem to verify the contents of the documents he's signing.

• For example, he signed a document supposedly transferring a mortgage from Lehman Brothers to Citi in 2009. It's hard to see how that's possible, since Lehman had already ceased to exist. When confronted with its nonsensical filing, Citigroup decided not to foreclose. Instead, it gave the homeowner a meaningful mortgage modification -- $15,000 principal reduction, plus a 30-year fixed mortgage at 3%.

For more, see Robo-Signing Scandal Spreads: Documents Show Citi and Wells Also Committed Foreclosure Fraud.

California Judge Stalls Foreclosure Eviction After Being Made Aware Of "Dubious Docs" Signed By Central Florida "Affidavit Slave"

In Los Angeles, California, the Los Angeles Times reports:

• Zeenat "Zee" Ali, who dropped out of medical school to contest the foreclosure of her mother’s Diamond Bar home, won another round in court this week when a judge in Pomona put the eviction on hold at least until November.

• In an order filed Tuesday, Los Angeles County Superior Court Judge R. Bruce Minto said the family had "shown a probability of success" in its claim that fouled-up paperwork invalidated the transfer of the mortgage in 2006 when it was sold in a bundle of loans that were used to create mortgage-backed securities.

***

• The defendants are now-defunct Downey Savings(1) of Newport Beach, which wrote the loan; Deutsche Bank; and Central Mortgage Co., a subsidiary of Arkansas' Arvest Bank Group that handled customer service on the loan.

***

• Her lengthy battles with the banks in state and federal courts, conducted without benefit of an attorney, were described in a Times article(2) and blog post in early August. At that time, Ali, 23, had just retained a lawyer, Kenneth T. Zwick of Costa Mesa. Zwick filed the request for a temporary restraining order that Minto granted this week.

• Zwick's grounds for requesting the order included the allegation that a document transferring customer-service rights on the Ali mortgage had been signed improperly by Crystal Moore, identified in the papers as a Downey vice president.

• Citing stories in the St. Petersburg (Fla.) Times,(3) the request said Moore in fact worked for Nationwide Title Clearing Inc. in Palm Harbor, Fla.,(4) where she and another employee had been "robo-signing" thousands of mortgage documents as though they were officers of banks, when in fact they were not. "A few people in Florida pretended to be vice presidents of dozens of banks," Zwick said in an interview.

• Jeremy Pomeranz, a Nationwide Title Clearing senior vice president, said Moore works for his company but denied that anything improper had occurred. Nationwide Title Clearing employees such as Moore are often appointed vice presidents by lenders for the limited purpose of allowing them to sign transfer papers when pools of loans are sold, Pomeranz said. He said that in the case of the Ali loan, Downey’s board had named Moore a vice president for that purpose.

For the story, see Eviction delayed again in challenge to Diamond Bar foreclosure.

(1) The fact that one of the mortgage companies appearing downstream in the loan's chain of title is now out of business can only make it that much more difficult for the current holder to properly establish said chain, thereby enhancing the chances of a favorable resolution for the homeowner.

(2) See Fighting parents' foreclosure, Diamond Bar student wins rounds against Deutsche Bank (With no legal training, Zeenat Ali, 23, has been doing battle in court, winning judgments against the bank and two other companies mainly on procedural grounds).

(3) See When 'Bryan J. Bly' became 'NB,' did he know what he was signing? (St. Petersburg Times, June 20, 2010).

(4) Nationwide Title Clearing is named in Fraud Digest's recently released list of the Dirty Dozen - "the mortgage servicing companies most responsible (in the opinion of Fraud Digest) for flooding courts with millions of fraudulent mortgage assignments and Affidavits in foreclosure cases." (Thanks to Deontos .is for the heads-up on the Dirty Dozen list.)

BofA Finally Dumps Debt Collector After Report Of Use Of Racist, Obscene Calls Hits National TV; Bank Continued Using Outfit Despite $1.5M+ Jury Award

In Dallas, Texas, ABC News reports:

• Two days after being confronted by ABC News, Bank of America has fired a debt collection agency after several of its operators were caught using racist and obscene phone calls to collect debts from bank customers.

• "What's up, you f---ing n---r?" said one of the collection agents in a message to 32-year old Allen Jones of Dallas, who owed $81 on his Bank of America credit card. "This is your f---ing wake up call, man," the debt collector said in a message left at Jones' home at 6:30 a.m. In a message left a few minutes later, the debt collection agent told Jones, "You little, lazy ass bitch, get your mother f---ing ass up and go pick some mother f---ing cotton fields, bitch."

• Jones said the calls continued even after he told the debt collection company he had paid his credit card bill. [...] Jones saved the taped messages and hired lawyers to sue ACT. A jury in Texas found the [sic] both the debt collectors and the corporation responsible and awarded Jones more than $1.5 million.(1)

• Despite the verdict, Bank of America continued to use ACT, accepting the company's explanation that these calls were made by rogue employees, until the bank CEO, Brian Moynihan, was given a copy of the taped calls and questioned about the use of the agency.

For more, see Investigation: Debt Collectors, the N-Word and Bank of America (Bank Fires Collection Agency After Operators Caught Using Racist, Obscene Phone Calls to Collect Debts).

(1) Click Here, Here, Here, Here, Here, Here, and Here to listen to phone messages left by the debt collectors (Warning: Offensive Content in the phone messages, and be prepared to first sit through a ponderous commercial before hearing the messages).

Questions On Potentially-Defective Titles To Real Estate Recently Foreclosed Continue To Be Raised

Buried in a recent Bloomberg News report on Chase Home Finance operation supervisor (ie. "robo-signer", "affidavit slave") Beth Ann Cottrell contains this excerpt noting that the dubious documents being used by lenders and foreclosure mills to foreclose on homes could lead to defective title ownership to the same homes when they are ultimately taken back by these outfits and subsequently unloaded or otherwise dumped onto the unwitting general public:

• If the documents are shown to be false after a home has already been resold by a bank, that casts doubt on who is the rightful owner, said O. Max Gardner III, an attorney at law firm Gardner & Gardner PLLC in Shelby, North Carolina, who has represented homeowners in fighting foreclosures and has cases pending against JPMorgan.

• “I’m sure a lot of title insurance companies are concerned about the potential liability right now,” as borrowers challenge how banks made statements, he said. “The judges could absolutely hold the bank and attorneys in contempt.”

Source: JPMorgan Based Home Foreclosures on Faulty Court Documents, Lawyers Claim.

Now That The Dam Is Bursting Open, Are The "Ambulance Chaser" Billboards Trolling For "Wrongful Foreclosure" Cases Far Behind???

A story in The New York Times on the foreclosure mess fueled by the recent Ally/GMAC, dubious-document scandal contained this gem:

• The issue has broad consequences for the millions of buyers of foreclosed homes, some of whom might not have clear title to their bargain property. And it may offer unforeseen opportunities for those who were evicted.

• “You know those billboards that lawyers put up seeking divorcing or bankrupt clients?” asked Greg Clark, a Florida real estate lawyer. “It’s only a matter of time until they start putting up signs that say, ‘You might be entitled to cash payment for wrongful foreclosure.’”(1)

Source: GMAC’s Errors Leave Foreclosures in Question.

(1) If the following "wrongful lock-out/trash-out" cases provide any sense for what "wrongful foreclosure" cases might be worth, the billboards should begin dotting the landscape before year-end:

• Nevada High Court OKs $1M+ Damage Award To Homeowner Due To Mortgage Company Misidentification Of Home In Foreclosure (for the court ruling, see Countrywide Home Loans v. Thitchener, 192 P.3d 243; 2008 Nev. LEXIS 79; 124 Nev. Adv. Rep. 64 (September 11, 2008).),

• Long Island Judge Hammers Wells w/ $155K Tab For Oppressive, Heavy Handed, Egregious Conduct For Pre-Sale Lockout Of Homeowner In Foreclosure (for the court ruling, see Wells Fargo v. Tyson, 2010 NY Slip Op 20079 (Sup. Ct., Suffolk County, March 5, 2010)).

Title Insurer Extends Policy-Writing Suspension To JP Morgan Chase Foreclosures

The New York Times reports:

• A major title insurance company has stopped insuring homes foreclosed by JPMorgan Chase, another sign that the controversy over the legal practices of the big lenders is starting to influence the housing market.

• The company, Old Republic National Title Insurance, told its agents Friday that it would not write policies on foreclosed Chase properties until “the objectionable issues have been resolved,” according to a memorandum sent out by the firm’s underwriting department.(1)

• A Chase spokesman declined to comment. Old Republic executives did not return calls for comment. The title insurer, which is based in Minneapolis, said earlier in the week that it would not write policies for properties that had been foreclosed by another big lender, GMAC Mortgage.

For more, see Company Stops Insuring Titles in Chase Foreclosures.

See also, USA Today: Old Republic to stop writing policies for some foreclosures:

• [M]aryln Weiner, a title agent and real estate lawyer in Boca Raton, Fla., said she received a bulletin saying that Old Republic would also not insure title policy to a purchaser who has bought a property from Chase when the bank has foreclosed on the home and are now selling it to third parties.

• "They won't insure it after completion after the foreclosure," Weiner says. "This is going to set us back years. It's really going to be a mess. I think you're going to see actions to reopen foreclosures that already took place. This will have tremendous consequences and all title companies will do the same thing. We've never seen anything like this before."

(1) It seems to me that the underwriting department should also be concerned with the mortgages purportedly held by Chase, GMAC, etc. on those homes that are not in foreclosure as well. It stands to reason that if these companies can't prove that they own the loans that are in foreclosure, they probably can't prove that they own the loans they purportedly hold that aren't in foreclosure, either. Should a non-delinquent borrower decide to sell his/her home in a standard, conventional transaction (or any borrower for that matter, delinquent or not, who is trying to unload the home in a short sale), who does the title/closing agent look to for the satisfaction of mortgage when paying off the home seller's existing loan??? (If the purported existing mortgage lender can't prove that it owns the loan they claim to hold, they certainly have no authority to sign the satisfaction of mortgage.)

In theory, at least, it seems that the entire residential real estate sales industry, in my view, should be coming to a grinding halt by the end of the month.