Tuesday, May 22, 2012

California Warns Homeowners: Mass Joinder Lawsuits Are Almost Always A Scam



Full Article can be found here: help.freehomeownershiphelp.com

FTC Legal Action Halts Alleged Mortgage Relief Scammers Who Lured Homeowners with Bogus Claims

At the request of the Federal Trade Commission, a U.S. district court has halted an operation that took in more than $1 million by allegedly selling homeowners bogus mortgage relief and foreclosure rescue products, including a scam that falsely promised to get help for homeowners who joined others to file so-called “mass joinder” lawsuits against their lenders. This is the FTC’s first case against alleged scammers who pitch these kinds of lawsuits.

 The full article: Federal Trade Commission

Mass Joinder Lawsuits Exposed!

The California State Bar Association has raided the offices of Kramer and Kaslow seizing records of their so called mass joinder suit.

For the full article: investigativeguy.com

Federal Trade Commission- Mass Joinder Lawsuits: A New Twist on Foreclosure Rescue Scams

A new scam is targeting financially strapped homeowners across the country. So-called specialized law firms are sending invitations to homeowners, urging them to participate in "mass joinder" lawsuits against their mortgage lenders as a way to get favorable loan modifications and stop foreclosure.

The Federal Trade Commission (FTC), the nation's consumer protection agency, cautions that the firms involved in this scam promise relief, but generally don't deliver. In fact, many of the firms fail to use qualified attorneys or pursue homeowners's cases, and often leave their clients in worse financial shape than before.

For the full article: Federal Trade Commission

Thursday, May 17, 2012

Successful New Mortgage Foreclosure Defense

Decided on April 24, 2012
 Supreme Court, Queens County
 Wells Fargo Bank, N.A., Plaintiff, against Roland Chateau, et al., Defendants. 

Index No. 1959/10 

Joseph G. Golia, J.

 Defendant's motion for production of Attorney Authority pursuant to CPLR § 322 is granted upon the papers considered. 

 CPLR § 3020 [d] [3] permits plaintiff's attorney to verify a complaint when the plaintiff "is a foreign corporation, or is not in the county where the attorney has his office." Here, plaintiff states in their opposition to the present motion that plaintiff Wells Fargo has their principal place of business in South Dakota. Furthermore, as attested to by plaintiff's counsel in the verification, the plaintiff corporation does not maintain an office within Erie County, NY, the county where plaintiff's counsel's office is located. However, in instances where a verified complaint has been found to "constitute[] prima facie evidence of the attorney's authority"the verification was made by the plaintiff, not plaintiff's attorney (see Raczok v. Capasso, 32 Misc 3d 1242(A) [NY Sup Kings Co 2011]) .

 It should be apparent why a verification made by the plaintiff would qualify as "prima facie evidence of the attorney's authority," but the same cannot necessarily be said about a verification made by the attorney. Verification is an attestation to the fact that the contents of a pleading are true. A verification by the plaintiff that the contents of a pleading are true can simultaneously be implicitly understood as a grant of authority to the attorney. However, while a plaintiff's attorney may be able to attest to the truthfulness of a pleading via verification, such a verification does not necessarily have any bearing upon the question of the attorney's authority to initiate the action. 

 CPLR § 322 states that any request for attorney authority can be made "at any time before answering." Such a motion is not restricted to the window of time before the statutory deadline for an Answer has expired as is argued by plaintiff. Deference must be given to the Legislature's deliberate decision to set the timeframe as it did, and not presumptively apply an interpretation which is at odds with the plain meaning of the text of the statute. 

 The purpose of § 322 is self-evident: to ensure that a defendant is neither dispossessed of their home nor is their interest in their home significantly impaired when the plaintiff landlord/mortgagee does not truly desire such an outcome. Additionally, a court's granting of a motion for leave to file a late answer in a foreclosure action is no great rarity. This is especially true now, evidenced in the facts that the State of New York's policy is to foster settlements in foreclosure actions(see CPLR § 3408, wherein parties to a residential foreclosure action are required to engage in settlement negotiations with the express goal of "reach[ing] a mutually agreeable resolution to help the defendant avoid losing his or her home"), and the fact that good faith engagement in settlement negotiations provides a reasonable excuse for the filing of a late Answer. To find that the filing of a late Answer would present a statutory bar to the granting of a § 322 motion would be in [*2]opposition to both the purpose of § 322 and the State of New York's policy of containing the residential foreclosure crisis wherever possible. Defendant simultaneously submitted to the court a motion to file a late answer and the instant § 322 motion. As such, defendant has not yet filed an Answer, and is thus permitted to seek evidence of attorney authority via a § 322 motion. Plaintiff is hereby ORDERED to file with this Court and serve upon defendant within 30 days of entry of this order evidence of the authority of the plaintiff's attorney to bring the herein action. Such evidence shall be in the form of a notarized affidavit wherein the affiant is an officer or employee of plaintiff corporation who is authorized to execute such a document. If the execution of said affidavit occurs outside the state of New York, said affidavit shall abide by the mandates of CPLR § 2903 [c]. The foregoing constitutes the decision, opinion, and order of the court.

Monday, May 14, 2012

Manhattan U.S. Attorney Recovers $202.3 Million From Deutsche Bank And Mortgageit In Civil Fraud Case

Preet Bharara, the United States Attorney for the Southern District of New York, Stuart F. Delery, the Acting Assistant Attorney General for the Civil Division of the U.S. Department of Justice, Helen Kanovsky, General Counsel of the U.S. Department of Housing and Urban Development (“HUD”), and David A. Montoya, Inspector General of HUD, announced today that the United States has settled a civil fraud lawsuit against DEUTSCHE BANK AG, DB STRUCTURED PRODUCTS, INC., DEUTSCHE BANK SECURITIES, INC. (collectively “DEUTSCHE BANK” or the “DEUTSCHE BANK defendants”) and MORTGAGEIT, INC. (“MORTGAGEIT”). The Government’s lawsuit, filed May 3, 2011, sought damages and civil penalties under the False Claims Act for repeated false certifications to HUD in connection with the residential mortgage origination practices of MORTGAGEIT, a wholly-owned subsidiary of DEUTSCHE BANK AG since 2007. The suit alleges approximately a decade of misconduct in connection with MORTGAGEIT’s participation in the Federal Housing Administration’s (“FHA’s”) Direct Endorsement Lender Program (“DEL program”), which delegates authority to participating private lenders to endorse mortgages for FHA insurance.

Pursuant to the settlement, MORTGAGEIT and the DEUTSCHE BANK defendants will pay the United States $202.3 million within 30 days of the settlement. As part of the settlement, the defendants admitted, acknowledged, and accepted responsibility for certain misconduct. Specifically,

MORTGAGEIT admitted, acknowledged, and accepted responsibility for the following:

MORTGAGEIT failed to conform fully to HUD-FHA rules requiring Direct Endorsement Lenders to maintain a compliant quality control program;

MORTGAGEIT failed to conduct a full review of all early payment defaults on loans endorsed for FHA insurance;

Contrary to the representations in MORTGAGEIT’s annual certifications, MORTGAGEIT did not conform to all applicable HUD-FHA regulations;

MORTGAGEIT endorsed for FHA mortgage insurance certain loans that did not meet all underwriting requirements contained in HUD’s handbooks and mortgagee letters, and therefore were not eligible for FHA mortgage insurance under the DEL program; and;

MORTGAGEIT submitted to HUD-FHA certifications stating that certain loans were eligible for FHA mortgage insurance when in fact they were not; FHA insured certain loans endorsed by MORTGAGEIT that were not eligible for FHA mortgage insurance; and HUD consequently incurred losses when some of those MORTGAGEIT loans defaulted.

The DEUTSCHE BANK defendants admitted, acknowledged, and accepted responsibility for the fact that after MORTGAGEIT became a wholly-owned, indirect subsidiary of DB Structured Products, Inc and Deutsche Bank AG in January 2007:

The DEUTSCHE BANK defendants were in a position to know that the operations of MORTGAGEIT did not conform fully to all of HUD-FHA’s regulations, policies, and handbooks;

One or more of the annual certifications was signed by an individual who was also an officer of certain of the DEUTSCHE BANK defendants; and;

Contrary to the representations in MORTGAGEIT’s annual certifications, MORTGAGEIT did not conform to all applicable HUD-FHA regulations.


Friday, May 11, 2012

Banking Giant HSBC ‘A Criminal Enterprise’

The global banking giant HSBC is a “criminal” operation, charges a former officer for the company’s southern New York region in a video interview with WND.

For the video and full article: Banking giant HSBC 'a criminal enterprise'

AG robo-signing settlement monitor puts complaint forms online

Borrowers will get a chance to file complaints electronically with the monitor of the $25 billion foreclosure settlement with the largest mortgage servicers.

For Full Article: AG robo-signing settlement monitor puts complaint forms online

Monday, May 7, 2012


Press Release April 26, 2012 Contact: David Neustadt 212-709-1691 DEPARTMENT OF FINANCIAL SERVICES TO HOLD PUBLIC HEARINGS ON FORCE-PLACED INSURANCE Force-Placed Insurance Industry Participants and Other Interested Parties To Testify Hearings in New York City to Begin May 17 and likely to last several days Homeowners invited to detail their experiences with force-placed insurance via the Department's Website Benjamin M. Lawsky, Superintendent of the Department of Financial Services, today announced that public hearings will begin on May 17, 2012 in New York City to review whether rates for force-placed insurance are appropriate or excessive and to examine the relationships between and payments to and from insurers, banks, mortgage servicers and insurance agents and brokers. The New York State Department of Financial Services will conduct the hearings from 10 a.m. to 5 p.m. beginning on Thursday, May 17. The hearings will likely continue on May 18 and May 21. The hearings will be held in the Neil Levin Hearing Room on the 5th floor of the Department’s offices at 25 Beaver Street in Manhattan. The hearings will be webcast. The public hearings relate to a Department investigation into whether homeowners and investors in mortgage-backed securities are harmed by high premium charges when banks and servicers "force-place" insurance on the properties they service. This occurs when homeowners' own property insurance may have lapsed or where the bank deems the homeowners' insurance insufficient. The Department has already sent letters to 15 financial services companies directing them to provide written and oral testimony and answer the Department's questions. The companies include banks, mortgage servicers, insurance agents and brokers, insurers and reinsurers. "The object of these hearings will be to probe all the inner workings of this important industry and examine its impact on homeowners and investors. We will use the information gathered at the hearings to determine whether force-placed insurance rates are justified or need correction. We are looking into all aspects of this industry, and will take whatever action is necessary to root out any misconduct and to make sure that homeowners and investors are treated fairly," Superintendent Lawsky said. In addition to financial services companies, testimony will be presented by housing advocates, expert witnesses, homeowners and other interested parties. The Department began looking into force-placed insurance in October, 2011 when it uncovered evidence of potentially problematic and abusive practices in the industry occurring at the expense of homeowners and investors. Homeowners and others who wish to share their experiences with force-placed insurance with the Department and the public can tell their story at: http://www.dfs.ny.gov/consumer/csb_tellyourstory.htm. The Department plans to consider some of these stories at the hearings.