Former Detroit Cop Clipped For Mortgage Fraud

A former top Detroit Police Department homicide lieutenant has been charged with running a criminal enterprise, the Wayne County Prosecutor’s Office announced Thursday.

Former homicide Lt. William R. Rice, 60, and Cheryl R. Sanford, 44, were arraigned Wednesday. Bond was set at $10,000.

According to the prosecutor’s Deed Fraud Unit, the suspects are alleged to have conducted a criminal enterprise from 2006 through last year, a charge that carries a maximum of 20 years in jail and $100,000, plus criminal forfeiture of proceeds.

“It is alleged that Rice and Sanford provided false information and misrepresented their interests in Detroit and Taylor properties to obtain federal funds to qualify for mortgages,” the Prosecutor’s Office said in a statement.

They are also charged with acquiring or maintaining property used to violate the Controlled Substances Act.

Rice also is alleged to have committed perjury while under oath in connection with a federal bankruptcy proceeding. Both have been charged with 16 counts, each felonies.

Several counts also involved the delivery or manufacture of a controlled substance.

Police Chief Ralph Godbee Jr. issued a statement Thursday night, saying: “If the allegations prove to be true regarding a former member of the Detroit Police Department (DPD), it is extremely disappointing. This is not reflective, however, of the many current and former members of DPD who serve and have formerly served this city with great integrity.”

Read more here

Biloxi Buzz for Saturday

Supreme Court Blocks State's Corporate Spending Ban

Chris Christie Vetoes New Jersey Same-Sex Marriage Bill

RECALL: All Infants' Tylenol Pulled From Shelves

French Teen Reportedly Gave Birth To Hitler's Love Child

Justice Department Will No Longer Defend Law Blocking Military Benefits For Same-Sex Couples

Three Massachusetts Counties Sign Up To Sue MERS

Three Boston-area counties plan to sue the banking industry’s Mortgage Electronic Registration Systems, claiming it helped large lenders improperly trade mortgages among themselves and avoid millions in filing fees.

“It just seems to be if you were a big bank, you didn’t necessarily follow the rules,” Norfolk County Register of Deeds William O’Donnell told the Herald.

Norfolk, Plymouth and Bristol counties have all signed on with law firm Bernstein Liebhard, which is lining up counties across America to sue MERS.

MERS is essentially a private clearinghouse that banks use to buy and sell mortgages to each other.

Lenders file documents once with registries listing MERS as a mortgage’s owner, then sell the loan over and over to each other without submitting any additional paperwork.

Critics claim that violates state land-records laws — and stiffs registries out of a $75-per-transaction fee.

Plymouth County believes it has lost as much as $6.5 million, while Bristol County thinks it’s out $3.1 million and Norfolk County feels it’s due $2.3 million.

Norfolk County Director Dan Matthews added that $40 of each fee goes to the state, which is struggling to plug gaps like the MBTA’s $161 million deficit.

“You might be able to keep the MBTA running if you had all of those $40 payments,” he said.

Read more here

A Valentine from Chief United States Bankruptcy Judge Karen S. Jennemann on Feburary 14, 2012

The Court cannot avoid suspecting that the second allonge indeed was created solely to rebut the trustee‘s assertions in this litigation and did not previously exist. If so, the Court suggests Deutsche and Ms. Faber individually consider the possible consequences of propounding potentially false evidence and perjured testimony to the Court.

Muselman v. Deutsche Bank, U.S. Bankruptcy Court, Middle District of Florida, Orlando Division, Case No. 6:10-bk-07828-KSJ. Document 67, page 8.

As gratifying as this recognition of fraudulent documents may be, it does raise the question: just what are the consequences of propounding false evidence and perjured testimony to the Court. With the exception of a few judges and a few decisions, there have been no consequences whatsoever.

New customers furious at Citibank gimmick, filed federal class action

MANHATTAN (CN) - Irate customers claim in a federal class action that Citibank lured them in by offering 40,000 frequent-flier miles to open an account - but didn't tell them they had to report 2½ cents per mile as income to the IRS.
Lead plaintiffs Bertram Hirsch and Igor Romanov say that Citibank grossly overvalued the miles, which have no actual value to customers and should not be taxable.
"Citibank regularly offers promotional American Airlines miles to induce customers to open up checking or savings accounts at Citibank, usually with a minimum deposit of $25,000," the complaint states.
"What Citibank does not disclose to customers who take advantage of the American Airlines miles promotions is that Citibank will file with the Internal Revenue Service ('IRS') a 1099-MISC reporting that they received miscellaneous income, in the amount of 2.5 cents per mile, for the American Airlines miles provided to such customers.
"It is widely understood in the marketplace that airline miles are not reported to the IRS as being taxable for income tax purposes. Indeed, Citibank expressly informed plaintiff Hirsch that the American Airlines miles that he would receive for opening up Citibank checking and savings accounts were not taxable.
"Even if the airline miles were taxable, Citibank's practice of valuing the airline miles at 2.5 cents per mile is grossly unfair and deceptive. Airline miles have no value to Citibank customers that can be fixed at the time they are awarded. If redeemed, these miles typically have an average value to customers of between .76 cents per mile and 1.2 cents per mile. At least one study recently concluded that American Airlines miles in particular are only worth about .76 cents per mile.
"Citibank failed to make these material disclosures because it knew that very few customers, if any, would take advantage of the airline miles offers because they did not make economical sense. Citibank benefits from this practice by gaining additional banking business and savings deposits from which it could lend out at much higher interest rates than the low interest rates paid to plaintiffs and the members of the class.

Read on.

Avid Law Center Performs Securitization Audits That Could Save Distressed Homeowners From Foreclosure

ALISO VIEJO, CA, Feb 16, 2012 (MARKETWIRE via COMTEX) -- The recent $25 billion mortgage settlement with the nation's five largest banks has left many homeowners wondering how they will be affected, especially those who have already been foreclosed on. Whether a homeowner has already lost their home or they are on the verge of having it taken away, there are steps beyond the settlement that homeowners can take to prove that they are entitled to mortgage relief.

One strongly recommended service is a securitization audit. A securitization audit, such as those conducted by Avid Law Center, is an investigation that determines if a loan was improperly securitized and can uncover other wrongful acts by the lender in the foreclosure process. If the audit identifies enough inconsistencies, there is a good chance that any foreclosure proceedings conducted against the homeowner may have been illegal or wrongful.

"In any litigation surrounding improper foreclosure practices, it is up to the homeowner to prove that the lender is illegally or wrongfully foreclosing. We have found that one of the best ways to do this is with a securitization audit," said Aron Rofer, President, CEO and Managing Attorney for Avid Law Center. "This helps give our attorneys the information they need to determine if we can build a case, and may give our clients the best chance of achieving positive results consistent with their needs."

Read on.

Calif. AG Harris to review findings on SF foreclosures

California Attorney General Kamala Harris said Thursday that her office was reviewing a new report that found most residential mortgages in foreclosure in San Francisco are missing documents or signatures or otherwise violate the law.

More than 80 percent of the loans examined at the order of San Francisco Assessor-Recorder Phil Ting contained such errors, according to the report.

"The allegations are deeply troubling and, sadly, no surprise to homeowners and law enforcement officials in California," Harris said.

Read more: http://www.sfgate.com/cgi-bin/article.cgi?f=/n/a/2012/02/16/state/n174042S58.DTL#ixzz1mc7ZX6cP

EXCLUSIVE: Woman silenced at birth control hearing with House committee on 'Ed Show' yesterday

Chairman Darryl Issa turned away a woman who was set to testify at yesterday's House committee hearing. There were no women testifying in the first panel. This will haunt Issa as well as the GOP on the committee as they continue to play political football. Here name is Sandra Fluke. Who is Sandra Fluke?

She is past president of the school's Students for Reproductive Justice group. She has lobbied the administration at Georgetown (a private, Jesuit, research university) for three years to include birth control in its student health plans. Here is what she wanted to say to the House committee and here is her interview on the 'Ed Show.'

Visit msnbc.com for breaking news, world news, and news about the economy

Palm Beach County foreclosure filings soar 52 percent in past year

Lenders ramped up Florida foreclosures last month, an acceleration driven by continued robo-signing fixes and expected to hasten after last week’s $25 billion mortgage settlement with the nation’s largest banks.

Statewide, foreclosure filings were made on 24,783 homes, a 14 percent jump from January 2011 and the first year-over-year increase in overall activity in more than a year, according to a report to be released today by the Irvine, Calif.-based firm RealtyTrac.

In Palm Beach County, overall foreclosure activity was down 4.5 percent in January from last year, but a 52 percent spike in initial filings affirms experts’ predictions that lenders are revving their home repossession engines.

“They will go full speed, pedal to the metal,” said foreclosure defense attorney Roy Oppenheim of Weston-based Oppenheim Law. “The settlement tells them how to do things and if they do it that way they are free to proceed.”

The nationwide agreement announced Feb. 9 with Bank of America, JPMorgan Chase, Wells Fargo, Citigroup, Bank of America and Ally Financial is expected to bring $8.4 billion in cash and mortgage relief to Florida homeowners.

Full details of the settlement are not expected until it is submitted to a federal judge for approval, but some attorneys and real estate consultants are concerned that it is too forgiving of fraudulent court documents filed by banks and will embolden an increase in foreclosures.

According to an executive summary of the settlement, it contains a “broad release” of banks’ conduct related to loan servicing and foreclosure preparation that bars attorneys general from filing civil claims in those areas.

“It’s the deal of a lifetime for a precious few homeowners,” said Jack McCabe, chief executive of McCabe Research & Consulting in Deerfield Beach. “But for the vast majority of people it still means going through a potential foreclosure and trying to negotiate with a bank that might not be as willing to negotiate after the settlement.”

Read more here

Biloxi Buzz for Friday

House Dems Storm Out Of Birth Control Hearing

Pulitzer-Prize Winning Reporter Dies In Syria

BUCHANAN OUT AT MSNBC

Santorum Backer: 'In My Days, They Used Bayer Aspirin For Contraception'

MBIA tells judge of newly uncovered Countrywide fraud database

I sure hope the Securities and Exchange Commission and other members of the new joint mortgage-backed securities task force are paying attention to the docket in MBIA's New York State Supreme Court fraud and breach-of-contract suit against Countrywide. On Wednesday, MBIA's lawyers at Quinn Emanuel Urquhart & Sullivan sent a letter to Justice Eileen Bransten requesting that she order Countrywide to produce discovery on an internal fraud-tracking database "which MBIA had not previously known to exist." MBIA said it needs the discovery to prepare for upcoming depositions of former Countrywide employees who tried to expose its allegedly fraudulent mortgage underwriting practices, including the well-known whistleblowers Eileen Foster and Mari Eisenman.

I've said it before and I'm sure I'll say it again: Everyone pursuing mortgage-backed securities issuers owes a big debt to bond insurers, who were the first to file MBS suits and have fiercely litigated them for the last three years. In addition to records of the mortgage-fraud database, known as FACTS, MBIA wants Countrywide to turn over the employment files of "two former Countrywide loan officers whose fraudulent activities were initially covered up due to their profitability," and records of senior executive committee meetings that "should show that Countrywide deliberately passed on riskier loans to the secondary market while retaining safer loans for itself, again in violation of its representations and warranties."

Read on.

Here is the the letter. Click here.

The U.S. foreclosure crisis, Beverly Hills-style

BEVERLY HILLS, Feb 16 (Reuters) - The careworn house not far from Santa Monica Boulevard resembles millions of other homes that have been foreclosed on since the calamitous U.S. housing crash four years ago.

Garbage spews from trash bags behind the property. A smashed television leans against broken furniture. A filthy toy dog lies on its side, an ear draped across its face. The garden is overgrown. The house needs a paint job.

Yet the property on North Rexford Drive, Beverly Hills, California, is no ordinary foreclosure.

A sprawling, Spanish-style estate, fringed by majestic pine trees and located near the boutiques of Santa Monica Boulevard, its former owners were served with a default notice in 2010; they were $205,000 behind in their payments on mortgages totalling $6.9 million.

Welcome to foreclosure Beverly Hills-style.


Read on.

Banks Spent Record $62 Million To Wine & Dine Politicians

Commercial banks spent nearly $62 million last year on lobbying, another record total for an industry that has become one of the most active voices in the political arena.

While their return on that investment is difficult to quantify, this much is clear: The financial industry’s spending helped slow down the pace of new regulation and gained it at least a few partial victories in a year filled with anti-bank rhetoric.

Last year’s lobbying expenditures by the commercial banking industry were up 9 percent from the year before, marking the sixth straight year of increased spending, according to data from the Center for Responsive Politics.

The financial sector as a whole spent more than $472 million.

That made the sector the third-biggest lobbying spender, behind the health care industry and general business associations like the U.S. Chamber of Commerce.

Read more here

What does deodorant, soap, and contraceptives have in common?

As Rick Santorum:

Santorum compared contraception to deodorant and soap when making a point about why he believes birth control should not be covered by health insurers.

"Let's mandate that every insurance policy covers toothpaste. Deodorant. That might be a good idea, right? Have everyone cover deodorant, right? Soap. I mean, where do you stop?"

Biloxi Buzz for Thursday

Euro Countries Doubtful Over Second Massive Bailout

Payroll Tax Deal May Allow Drug Testing, Cut Unemployment Benefits

Honduras Prison Fire Death Toll Soars Past 350

Oklahoma Senate Approves 'Personhood' Bill

Actress In Controversial China Political Ad: 'It Was Absolutely A Mistake'

Lawmakers investigating use of arrest warrants against debtors

Some lawmakers and regulators are probing the use of arrest warrants by the U.S. debt collection industry to recover money owed by borrowers behind on loans, credit card payments, and other bills. Warrants are generally issued for contempt of court after the borrower fails to comply with a court order to repay a debt or to appear in court. Although U.S. statistics are unknown because many courts do not track the number of warrants issued by offense, judges interviewed by the Wall Street Journal reported that the number of borrowers threatened with arrest has vastly increased since the beginning of the financial crisis.

For their part, those in the debt-collection industry say that warrants are sought only after all other measures have failed, in the most extreme situations. Most creditors are willing to make reasonable arrangements with people otherwise struggling to repay their debt. However, the vast majority of people fail to respond to creditors’ attempts to contact them. Indeed, by the time a warrant is issued, debtors have often been contacted numerous times, and have ignored multiple phone calls, letters, and court orders. Still, some companies actually prohibit law firms handling their cases from pursuing arrest warrants, recognizing, among other things, the negative publicity that can follow.

Nevertheless, many state lawmakers and regulators are addressing what they view as either potential or actual abuses of the system. Last year, the House of Representatives in Washington state unanimously passed a bill that would require companies to provide proof that a borrower has been notified about lawsuits against him before a judge could issue an arrest warrant. The bill was supported by a trade group representing debt collectors, stating that more regulation is needed to prevent abuse by a small number of companies.

Rest here…

California Audit Finds Broad Irregularities in Foreclosures

An audit by San Francisco county officials of about 400 recent foreclosures there determined that almost all involved either legal violations or suspicious documentation, according to a report released Wednesday.

Commissioned by Phil Ting, the San Francisco assessor-recorder, the report examined files of properties subject to foreclosure sales in the county from January 2009 to November 2011. About 84 percent of the files contained what appear to be clear violations of law, it said, and fully two-thirds had at least four violations or irregularities.

The report comes just days after the $26 billion settlement over foreclosure improprieties between five major banks and 49 state attorneys general, including California’s. Among other things, that settlement requires participating banks to reduce mortgage amounts outstanding on a wide array of loans and provide $1.5 billion in reparations for borrowers who were improperly removed from their homes.

But the precise terms of the states’ deal have not yet been disclosed. As the San Francisco analysis points out, “the settlement does not resolve most of the issues this report identifies nor immunizes lenders and servicers from a host of potential liabilities.” For example, it is a felony to knowingly file false documents with any public office in California.

In an interview late Tuesday, Mr. Ting said he would forward his findings and foreclosure files to the attorney general’s office and to local law enforcement officials. Kamala D. Harris, the California attorney general, announced a joint investigation into foreclosure abuses last December with the Nevada attorney general, Catherine Cortez Masto. The joint investigation spans both civil and criminal matters.

The depth of the problem raises questions about whether at least some foreclosures should be considered void, Mr. Ting said. “We’re not saying that every consumer should not have been foreclosed on or every lender is a bad actor, but there are significant and troubling issues,” he said.

http://bit.ly/wPPhzT

Chief judge announces new foreclosure court part in state of judiciary speech

ALBANY, N.Y., Feb 14 (Reuters) – A new court initiative will allow all New York homeowners facing foreclosure to obtain legal representation and streamline the process of settling mortgage disputes out of court, Chief Judge Jonathan Lippman said Tuesday during his annual State of the Judiciary speech.

The “unprecedented” deal between the state, legal service groups and four large banks — Wells Fargo, Citibank, Chase and Bank of America — includes the creation of a new court part that will hear only foreclosure settlement conferences, Lippman said. Each week of the month will be dedicated to a different bank, with one attorney assigned to handle all cases for that lender.

“There will be no more excuses, no more delays,” Lippman said. “Real negotiations will take place, and homeowners will leave the table with the best available offer.”

The court system, Lippman said, is seeking to avoid scenarios that can delay settlement conferences for years, including homeowners being told their paperwork is out-of-date and lawyers for banks claiming to have incomplete sets of documents.

The program will kick off in New York City, where non-profit legal service groups have agreed to represent all homeowners entering the settlement conference process. The new part will not launch for “at least a couple of months,” said Paul Lewis, who helps coordinate courts’ handling of foreclosure proceedings for the Office of Court Administration.

Last year, New York became the first state to require attorneys for lenders to verify the accuracy of all mortgage documents. The rule led to an immediate dip in the number of foreclosures filed in the state, but court officials recently warned of a continuing crisis that is depriving homeowners of their legal rights and overburdening the court system. More than 345,000 mortgages were delinquent or in default in New York in 2011, according to a report released last month by the Neighborhood Economic Development Advocacy Project

Trashed Out | Chase, Safeguard Properties Clean Out House, Family Heirlooms Gone from Home with NO Mortgage (VIDEO)

Federal Judge Slams Deutsche Bank, American Home Mortgage Servicing, Inc.

“Yet again, the court is called upon to decide whether the purported holder of a

note allegedly transferred into a securitized mortgage pool has standing to obtain relief

from the automatic stay. Yet again, the movant has failed to demonstrate that it has

standing. To make matters worse, the movant filed its motion without evidentiary support of its claim, attempted to create such evidentiary support after the fact, and only

disclosed its “real” evidence on the day of the final evidentiary hearing. The relief will be

denied.”

http://mattweidnerlaw.com/blog/wp-content/uploads/2012/02/Tarantola.pdf

Shareholders and robosigning: Is Wells Fargo ruling a portent?

Reuters Legal:

The big question for the other banks that signed the nationwide foreclosure settlement, though, is whether Illston's robosigning ruling improves the prospects for shareholder derivative suits against them. JPMorgan Chase, for example, was just hit with a Manhattan State Supreme Court robosigning derivative complaint filed by Robbins Geller, one of the plaintiffs' firms in the Wells Fargo case. Earlier this month, shareholders in a consolidated derivative class action against Bank of America in Manhattan federal court voluntarily dismissed their robosigning-based case, but said they planned to refile in Delaware Chancery Court. Two derivative suits against Citigroup alleging flawed foreclosure practices were consolidated in Manhattan federal court in December, but the docket indicates no activity since then.

But those banks, according to the plaintiffs' allegations in the Wells suit, were quicker to renounce robosigning than Wells Fargo. JPMorgan Chase and Ally Financial were the first to halt foreclosures to investigate robosigning allegations, doing so in September 2010. Bank of America followed in October. Wells Fargo was still insisting at the time that its foreclosure practices were sound. According to the shareholder complaint, Wells continued to permit robosigning of foreclosure documents well into 2011, after it told shareholders it was cooperating with the government investigation.

wellsroboderiv--MTDruling

Biloxi Buzz for Wednesday

Burning Sub Reportedly Had Nukes On Board

What The Steve Jobs Biography Got Wrong

White Grandfather Walking With Black Granddaughter Cuffed By Texas Police

Whitney Houston's Family Schedules Private Funeral Service

Gingrich Shoots Down Birther Queen

MA AG Coakley Threatens Blood Thirsty Pursuit If They Don’t Give Homeowners Principal Write Downs

The ink is not yet dry on a $25 billion national foreclosure settlement with five major banks, but Attorney General Martha Coakley has already trained her sights on two more targets.

Coakley, on Friday, told the News Service that unless Fannie Mae and Freddie Mac agree to begin modifying loans for borrowers victimized by fraud, an untold number of Massachusetts homeowners could be left without any relief.

“People are recognizing that we’d love to get the same relief we were able to accomplish through the 50-state settlement for these homeowners caught in the middle because Fannie and Freddie are not willing to entertain loan modifications or principal write downs,” Coakley said.

Massachusetts on Thursday became one of 49 states to sign on to the national settlement with the country’s five largest lenders netting roughly $318 million in relief for Bay State homeowners through loan modifications for borrowers at risk of default or “under water” because they owe more than their home is worth.

Coakley also retained the right as part of the settlement to pursue additional Massachusetts specific claims against the banks as part of lawsuit she filed in December that could bring additional relief.

Those homeowners that borrowed through Fannie Mae and Freddie Mac, however, are not covered under the settlement. Coakley said it’s unclear how many loans backed by Fannie and Freddie are active in Massachusetts, but nearly 60 percent of mortgages nationwide are held by the two agencies, and 45,000 Massachusetts owners have faced foreclosure since 2008.

Many more borrowers, according to Coakley, could be ineligible for relief under the new settlement if their mortgages are serviced by one of the five banks, but owned by Fannie or Freddie.

Read more here

FDIC Sues Failed Bank Execs for $86M

LAS VEGAS (CN) - Federal regulators hit four officers of the failed Silver State Bank with an $86 million lawsuit, claiming they negligently approved wobbly real estate loans that led to the bank's 2008 collapse.
The Federal Deposit Insurance Corp. sued Corey Johnson, the bank's CEO and co-founder, and vice presidents Douglas French, Gary Gardner and Timothy Kirby, in Federal Court.
Johnson "abandoned the bank's prior conservative lending strategy in favor of a high-risk ADC [acquisition, development and construction] lending strategy funded by brokered deposit," the FDIC says in its 76-page complaint.
The high-risk ADC loans were made between January 2006 and February 2008, the FDIC says.
"All of the defendants were grossly negligent and breached their fiduciary duties in originating, recommending, approving and/or administering the loss loans in violation of Silver State's loan policies," the complaint states. "Ultimately, as one witness testified in a sworn statement, the bank's failure was caused by land loans of this nature."
The FDIC claims that under co-founder Tod Little's guidance, the bank's "growth was steady and controlled, with conservative lending focused on small business administration loans to qualified borrowers."

http://www.courthousenews.com/2012/02/14/43861.htm

Federal Judge Says Texas Law Applies To Mortgage Foreclosure In Utah

A federal judge has ruled that Texas laws, and not those of Utah, govern foreclosures by a unit of Bank of America.

The ruling by U.S. District Judge Ted Stewart is the second to go that way in federal courts in this state, and the Utah Attorney General’s Office is asking to intervene to protect Utah’s ability to set its own laws regarding foreclosures.

Stewart handed down the decision this week in dismissing a proposed class-action lawsuit against BofA and its foreclosure arm, ReconTrust, as well as an attorney who performs the foreclosures in Utah for the bank. Stewart adopted the reasoning of Judge David Sam, who reached the same conclusion in a ruling handed down in December.

But Deputy Utah Attorney General John Swallow said his office intends to defend the state law that says only Utah attorneys and title companies with offices in the state can act as a trustee and foreclose on property.

Read more here

Federal Reserve Board releases orders related to the previously announced monetary sanctions against five banking organizations

For immediate release

The Federal Reserve Board on Monday released the orders related to the previously announced monetary sanctions against five banking organizations for unsafe and unsound processes and practices in residential mortgage loan servicing and processing. The Board reached an agreement in principle with these organizations for monetary sanctions totaling $766.5 million on February 9, 2012.

Attachments:

Ally Financial Inc. (PDF)
Bank of America Corporation (PDF)
Citigroup Inc. (PDF)
JPMorgan Chase & Co. (PDF)
Wells Fargo & Company (PDF)

Happy Valentine's Day

Wells Fargo board must face investors' claims that bank failed to disclose details of foreclosure practices to gov't investigators, judge says

Wells Fargo & Co. directors must face investors’ claims that largest U.S. mortgage lender failed to properly disclose details of its foreclosure practices to government investigators, a judge ruled.

U.S. District Judge Susan Illston in San Francisco rejected Wells Fargo’s request to dismiss shareholders’ allegations that directors wrongfully failed to disclose their opposition to a government probe of the bank’s mortgage lending and foreclosure policies.

“The fact that the company was allegedly stymieing the government regulators is certainly material to stockholders when considering whether to authorize a more serious internal investigation,” Illston said in Feb. 9 ruling.

Read on.

Biloxi Buzz for Tuesday

New Jersey Senate Passes Bill Legalizing Same-Sex Marriage

Obama Sending Budget To Congress

Athens Burns As Greece Leaders Debate Bailout Deal

Empire State Building Owners File $1B IPO

Please join my meeting:
https://www.freescreensharing.com/meetings/311-846-432
2. Join the conference call:
Dial: (559)546-1200
and enter the
Meeting ID: 311-846-432
followed by the # key. FINANCIAL FREAKOUT: Banks Decry Volcker Rule

Obama proposes $800 million in aid for “Arab Spring” — (Reuters) - The White House announced plans on Monday to help “Arab Spring” countries swept by revolutions with more than $800 million in economic aid, while maintaining U.S. military aid to Egypt. — In his annual budget message to Congress …

Gregoire signs gay marriage into law — With Gov. Chris Gregoire's signature on Monday, Washington joins six other states and the District of Columbia in allowing same-sex couples to marry. — OLYMPIA — Surrounded by applauding gay couples and with media from around the country looking on …

Rest easy, MBS investors: You're protected in mortgage settlement

(Reporting by Alison Frankel)

Asking investors in mortgage-backed securities to trust the banks that issued them is like asking Charlie Brown to trust Lucy van Pelt. MBS noteholders are so convinced they've been duped by the folks that packaged and sold shoddy mortgage loans that it's little wonder the banks' $25 billion settlement with federal and state regulators has been greeted with a tsunami of skepticism. Sure, MBS investors understand that the settlement doesn't preclude them or regulators from suing over deficient securitizations. But their fear, in the absence of the actual settlement documents, is that the loan modifications the deal calls for will reduce the revenue stream to MBS trusts.

It's an understandable fear. The five banks that agreed to the settlement -- Bank of America, JPMorgan Chase, Citigroup, Wells Fargo, and Ally Financial -- carry some troubled mortgage loans on their own books. Others were bundled into MBS trusts, in which the banks transfer ownership of the mortgages and remain as servicers. MBS noteholders are supposed to receive a stream of income from the principal and interest payments on the underlying mortgage loans. So if a bank agrees to reduce the unpaid principal a homeowner owes on a mortgage that's been securitized, less money flows to the trust and into MBS investors' hands.

Read on.

Lender Processing Services, Inc. (NYSE: LPS) Long Term Investor Filed Lawsuit over Alleged Wrongdoing by Directors

A lawsuit is pending by a current long term investor in shares of Lender Processing Services, Inc. (NYSE: LPS) over alleged breaches of fiduciary duties and other NYSE: LPS stockholders should contact the Shareholders Foundation.

San Diego, CA — (SBWIRE) — 02/13/2012 — The Shareholders Foundation announces that an investor in NYSE: LPS shares filed a lawsuit against members of the Lender Processing Services’ board of directors over alleged breaches of fiduciary duties and breaches of good faith in connection with Lender Processing Services’ default operations.

Investors who are current long term investors in Lender Processing Services, Inc. (NYSE: LPS) shares, have certain options and should contact the Shareholders Foundation at mail(at)shareholdersfoundation.com or call +1(858) 779 – 1554.

Between 2008 and 2010 the volume of foreclosures and bankruptcies increased dramatically. During that time automatically generated, unverified documents submitted in foreclosure and bankruptcy proceedings become known as the “robo-signing” foreclosure scandal of 2010.

The plaintiff alleges that that defendants breached their fiduciary duties and that the board of directors was made expressly aware of the issues with Docx, an LPS subsidiary, but did not end the robo-signing practice.

In early 2010 the U.S. Attorney’s office in the Middle District of Florida announced investigation s of Lender Processing Services, Inc and its subsidiary Docx, for their alleged improper use of allegedly false documents to foreclose on Florida homeowners.

The civil investigation focused on allegations that Lender Processing Services, Inc engaged in creating and manufacturing “bogus assignments’ of mortgage ownership in order to complete foreclosures quicker. Since then, other federal and state authorities, including various regulatory agencies, and other state attorneys general, have initiated inquiries about these matters, and additional agencies may do so in the future.

According to several media reports and various investigations Lender Processing Services’ default-related services division has also been accused of improperly splitting fees with attorneys, calling into question the source of a substantial portion of the company’s revenue.

In October 2010, after Lender Processing Services issued a press release commenting on what it considered “mischaracterizations of its services.” The price of LPS stock declined an additional $2.72, or 8.6% per share, on October 4, 2010, to close at $28.76 per share.

Lender Processing Services said that it discovered, during its own internal reviews, potential issues related to some of these practices which may cause the validity of certain documents used in foreclosure proceedings to be challenged.

The plaintiff alleges that in September and October of 2010, news articles across revealed that many of the automatically-generated documents used in judicial foreclosure proceedings and bankruptcies were improper and invalid and that the volume of Lender Processing Services documents filed in the wake of the financial crisis made clear that the paperwork was frequently automatically generated with very little, if any, factual investigation into whether the foreclosing entity had a legal right to foreclose on the property, and other facts critical to the proceedings.

The price of LPS stock fell another $1.45, or 5.04%, on October 5, 2010, to close at $27.31 per share, on unusually heavy trading volume.

Shares of Lender Processing Services, Inc. (LPS) traded on January 2012 as low as $14.40 per share and recently at under $20 per share.

Those who are current long term investors in Lender Processing Services, Inc. (NYSE: LPS) shares, have certain options and should contact the Shareholders Foundation.

Contact:
Shareholders Foundation, Inc.
Trevor Allen
3111 Camino Del Rio North – Suite 423
92108 San Diego
Phone: +1-(858)-779-1554
Fax: +1-(858)-605-5739
mail@shareholdersfoundation.com

Source: Shareholders Foundation, Inc.

Details emerge on Rep. Buck McKeon's Countrywide VIP loan

Four years after Countrywide Financial became a symbol of the mortgage meltdown, the company and its questionable dealings have become a potent political issue in the Santa Clarita congressional district held by Republican Howard "Buck" McKeon.

Congressional investigators allege that McKeon and Rep. Elton Gallegly, a Republican colleague whose neighboring district includes much of Ventura County, got cut-rate home loans under a Countrywide VIP program known as "Friends of Angelo," named for the now-defunct Calabasas lender's former chief executive, Angelo Mozilo.

McKeon received a $315,000 mortgage refinance in 1998 as his family-owned business, Howard & Phil's Western Wear, was going through a Chapter 11 bankruptcy, according to documents reviewed by The Times. McKeon was no longer involved in the daily operation of the business after his 1992 election to Congress, but he had retained a stake in it. He saw his income plummet in the years before refinancing his Stevenson Ranch home, financial disclosures and bankruptcy filings show.

In spite of that, McKeon received a favorable rate and wasn't required to produce documentation proving he could repay the mortgage — terms ordered by Mozilo himself, according to documents subpoenaed for a House inquiry.

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Del. AG to Chris Hayes on the foreclosure fraud settlement: Settlement does nothing to change the incentivize mortgage servicer structure

Written by Biloxi

There has been so much mixed reviews from the state Attorney General settlement with the five banks on Thursday. Some people say that they are satisified with the settlement. While some people criticize the settlement saying that the deal has not gone far enough and the homeowners got screwed. Regardless of how one feels about the settlement, the settlement is not perfect. But, the nightmare is not over fo the banks because state Attorneys General and pursue the banks criminally and civil that are not part of the settlement and homeowners can sue the banks in court or be a part of a class action, or seek further review/relief from the Office of the Comptroller of the Currency (OCC) according the National Mortgage Settlement website. And it is interesting according to the National Mortgage Settlement website that the state Attorney General settlement could affect some investor-owned loans, yet the settlement will not force investors to incur losses because because any loan modification tied to the settlement will result in more of a financial return than a foreclosure. From the National Mortgage Settlement website FAQ:

Q: Will investors in mortgage-backed securities ultimately pay for part of this settlement?


A: Participating banks own the vast majority of the mortgage loans that this settlement is expected to affect. The settlement could affect some investor-owned loans, depending on existing agreements servicers have with those investors.


When banks weigh which mortgage loans to modify as part of this settlement, they will do so based on first analyzing the costs and the benefits of minimizing their losses. If a loan modification, including principal reduction, is projected to cost the creditor or investor less than foreclosure, the creditor will earn more on that loan.


In other words, this settlement will not force investors to incur losses. That’s because any loan modification tied to this settlement will result in more of a financial return for an investor than a foreclosure would.


And for the homeowners that have lost their homes? Well, there is some good news for them. According to the National Mortgage Settlement website, "Borrowers who receive payments will not have to release any claims and will be free to seek additional relief in the courts. Borrowers may also be eligible for a separate restitution process administered by the federal banking regulators."

As critics of this settlement are dissatisfied that the dollar amount is too small and not large enough to make the victimized homeowners whole, one aspect that critics are not focused on which Attorney General Beau Biden points out in his interview on Up with Chris Hayes show is that the settlement had to be narrrowed to mortgage servicing conduct in order to allow the Attorneys General to pursue criminal investiggation against the banks. But, one thing that Biden brought up that caught my attention is that the settlement does nothing to change the fundmental incentivize structure of the mortgage servicers. Biden explains that mortgage servicers are incentivize to foreclosure because the servicers know that whether a homeowner pays or not, they have to forward the mortgage payment to the investor that they service the note for. Biden then goes on to explain that after months of not receiving money from the homeowner, then the servicer can exercise their right to foreclose because they know they will be the first to receive money off the top of the foreclosure. Biden says that the state Attorneys General have not try to align the interest to leverage the best deal for the investor community and homeowners. And this explains why Biden and the other state Attorneys General have to tackle to mortgage servicers' incentive structure because clearly this structure is not in the best interest of the homeowners and investors. This will continue to be major issue in the housing crisis no matter how much money the banks fork out in lawsuits with states, federal, and well as individuals. Here is Biden's interview with Chris Hayes:

Visit msnbc.com for breaking news, world news, and news about the economy

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Mortgage relief for service members, will receive big payouts

Members of the military services who lost their homes in unfair foreclosures have won a big victory – and will receive big payouts — in the comprehensive settlement of mortgage litigation that was reached last week.

Four big lenders have agreed to identify service members who lost their homes or were denied interest rate reductions in violation of a law that protects active duty and deploying troops from credit card or mortgage abuses – and to make up their losses. The lenders are JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial, formerly GMAC.

The breakthrough was described in a briefing on Friday by Holly Petraeus, assistant director for the Consumer Financial Protection Bureau’s Office of Servicemember Affairs; Tom Perez, assistant attorney general for the Justice Department’s civil rights division; and Attorney General Beau Biden of Delaware.

Wells Fargo, Citigroup and Ally will be required to provide any service member who was a victim of a wrongful foreclosure a minimum of $116,785, plus lost equity and interest, Mr. Perez said. Banking regulators could decide to make the payout even higher.

JPMorgan Chase, which has compensated some service members because of an earlier private settlement, will provide victims either their home free and clear of debt or the cash equivalent of the full value at the time of the sale. “In addition,” Mr. Perez said, “service members will receive compensation for any additional harm suffered.”

Those who think they may qualify can contact an Armed Forces Legal Assistance office. (More details are at servicemembers.gov. Or call the Justice Department at 800-896-7743.)

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Former New Orleans Mayor Ray Nagin under investigation: source

Petition to NY Commissioner Ray Kelly and Mayor Bloomberg to stop the cover-up of the death of whistleblower Sunny Sheu

Here is the text of the petition...

Commissioner Kelly and Mayor Bloomberg:

Anti-corruption Whistle blower Sunny was abducted by two NYPD detectives of the Queens DA bureau and threatened with death if he "went to the authorities".

Soon thereafter, Mr. Sheu was found near death, in a coma on a dead end street in Flushing Queens.

Hours after his death, the NYPD illegally removed his body and sent it to the Medical Examiner with a note saying he had died of natural causes and that there was "no criminality".

The Medical examiner disagreed, ruling the cause of death "Blunt force trauma to the Head with skull fractures and brain injuries." and the manner of death "undetermined", making a criminal investigation mandatory.

-The NYPD is violating NY State law by failing to investigate an "undetermined" death.

-The NYPD is violating NY State FOIL law by withholding information about Mr. Sheu's death.

We demand an immediate, full, transparent investigation by an independent prosecutor and prosecution of all involved, including NYPD personnel

http://signon.org/s/H=fI8C

Bank’s mortgage registry MERS under increasing scrutiny

Mortgage Electronic Registration System (MERS) Inc. wasn’t a party to the federal-state foreclosure settlement with five big banks this week, but its practices have raised the ire of county registrars.

“This system has bypassed the New Hampshire Registry of Deeds Offices and aided in the chaos and destruction that has crashed our economy. The MERS well of data is now completely toxic,” Kelley J. Monahan, register of deeds for Grafton County, wrote in a Feb. 3 letter to Attorney General Michael A. Delaney.

Delaney specifically mentioned that MERS was not released from any potential claims against it in announcing the settlement Thursday.

Because MERS becomes the lienholder of record, it can record the mortgage once, then the note can exchange many times without being recorded again at county registries.

MERS played a key role in securitization, or bundling, of mortgages by the banks for the secondary market.

“It provided this shell game for the homeowner to find out who they were dealing with, because they were dealing with one entity one day seeking a modification and then the next week, the loan would be sold and the game would be started from the beginning again,” Monahan said.

“Foreclosure is a personal and mortifying situation, so people don’t talk about it,” Monahan said. “The more we get this out there, the more people can share.”

Senior Assistant Attorney General James T. Boffetti said, “we have met with almost all of the registers of deeds to talk about the problem with MERS.

“There are some significant problems with the registries precisely because they weren’t recording all of the assignments,” he said.

“The banks created MERS to allow them to do all this mortgage-backed security business,” Boffetti said. “It was a way to quickly make all of these assignments of mortgages electronically without going through the traditional recording of assignments in the registry. That’s a problem. “

While the AG’s office continues to review the MERS situation, Boffetti said he couldn’t say more.

MERS spokesman Janis L. Smith said MERS was not in any current discussions with the multi-state Attorneys General task force.

“Federal and state courts around the country have repeatedly upheld the MERS business model and also affirmed the validity of MERS as legal mortgagee and nominee for the lenders, and we will continue to defend claims against MERS in the court system. We’ve had a very good litigation record.”

Smith said when a mortgage closes, it is recorded in county public land records with MERS recorded as the lienholder.

“Whenever there are transfers taking place between MERS members, the lien is in MERS’ name and MERS is the common agent,” she said. As long as the lien remains in MERS’ name there is no need to record transfers among MERS’ members, she said.

“In the event that there is a transfer from one MERS members to an institution that is not a MERS member, in that case, there would be an assignment of the mortgage or the servicing out of MERS name into the new owner’s name and that would be recorded,” she said.

Mike Dillon, founder of Stellionata Consulting LLC in Manchester, said, “MERS is a privatized national registry of deeds that was developed by a conglomerate of national and international banks.

“There is very little to no transparency whatsoever in the MERS system,” Dillon said. His business provides assignment and securitization analysis and foreclosure defense litigation.

“The only time anything is recorded with regard to MERS is when you originate a mortgage involving MERS or the mortgage is either satisfied or when a foreclosure action is initiated, and in between those periods, a borrower’s note can be sold/assigned/transferred literally 1,000 times without anybody being the wiser to it including the registries of deeds,” he said.

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