Is Foreclosure Fraud The New Black Swan For Banks
Video: Ex-Ginnie Mae CEO Joseph Murin on housing and illegal foreclosures:
- "It's going to get much worse. Expect delays of 6-18 months."
Excellent detail. Murin says he expects foreclosure delays of between 6-18 months due to the moratorium, which is much longer than most current estimates of 30-90 days.
Here's the nightmare scenario for banks -- more homeowners start to challenge the ownership of their mortgage, and choose to stop paying in the interim, destroying bank profits and balance sheets while they wait for resolution from Congress or the courts. Could get ugly. Quickly.
Both Janet Tavakoli and Chris Whalen said Thursday it could necessitate a 2nd-round of bank bailouts. The outcry from taxpayers would be deafening.
How in Hank Paulson's lost paradise of hell do you sell TARP 2.0 to an already bailout-loathing public, when the need for the new rescue is precipitated by bank losses from foreclosure fraud! You don't.
If you're Obama, you can't even look at the door to the room that has the desk where you would sit, and come to the table with this death-wish. Geithner would hasten his departure to Goldman, so you'd be alone. Buh-bye 2012.
Won't happen. Chances are zilch, less than ZIRP even. The result of which would create a new solvency crisis for banks, and this time it could very possibly be for real, given that no politician outside of Paul Kanjorski and Judd Gregg would even entertain bailout euthanasia. And there would be no more FASB rule-change Hail Mary to save their insolvent balance sheets.
Oh, and one more thing. Has anyone stopped to consider whether a similar practice might exist with securitized commercial real estate foreclosures. That will be for tomorrow. It could be the unanticipated Black Swan event of 2010-11. And this bird will be pissed off.
A surfing bird, probably. Clip from Family Guy included below.
---
Update: Janet Tavakoli sent along the following email tonight:
"The SEC is a failed regulator. This step is not optional when securities are created and underwritten, and underwriters should be held accountable.
The result:
- Banks are vulnerable to lawsuits from investors in the securitization trusts.
- This problem could cost the banks significantly more money, which could mean TARP II.
This was far from the only problem with the securitization process. It was a massive, widespread, interconnected Ponzi scheme with various types of concurrent fraud. So far our regulators, court system, and Congress have failed in their duties."
###
Get all the latest:
Update On The Foreclosure Fraud Crisis (Links, Latest Developments, New Ratigan Op-Ed, Denninger Video)
---
---
If the Black Swan were a Surfing Bird (choose your version):
Trashmen «Surfin Bird» live 1963 -- the original
#
Full Metal Jacket -- Surfing Bird
#
The Ramones -- Surfing Bird Live -- 1979
Make sure you're watching at 1:45-2:00 for the break.
#
Family Guy -- Bird is the Word
Stewie sticks a gun in his mouth at the end.
Oct 8, 2010 at 4:20 AM
Reader Comments (30)
tavakoli quote on tarp 2.0 is at the very bottom...
Chris Whalen quote on new round of bank bailouts because of foreclosure fraud.
---
[JT Note: The SEC is a failed regulator. This step is not optional when securities are created and underwritten, and underwriters should be held accountable.]
The result: "Banks are vulnerable to lawsuits from investors in the [securitization] trusts,"
"This problem could cost the banks significantly more money, which could mean TARP II."
JT Note: This was far from the only problem with the securitization process. It was a massive, widespread, interconnected Ponzi scheme with various types of concurrent fraud. So far our regulators, court system, and Congress have failed in their duties.
http://firsttuesdayjournal.com/another-prediction-that-california-metro-area-price-peaks-won’t-return-until-2025/
http://dailybail.com/home/is-ge-the-real-reason-paulson-panicked-in-the-aftermath-of-l.html
http://www.businessinsider.com/foreclosure-fraud-the-new-black-swan-for-banks-2010-10
It is the election season, and congress will act quickly to accept contributions to allow the banks to not show proof of the bank owning the mortgage, I have even heard of multiple banks saying they own the mortgage on the same property after the original bank failed. Courts have already allowed it happen, that is why the lawsuits are coming into play.
Everyone in trouble should challenge for proof because it is not your fault the system is screwed up.
The law defends the plunderer...
"The outcry from taxpayers would be deafening. "
Not really, the herdists will go out and vote for their favorite herd, while the majority will stay home to watch dancing with the stars. The banks and politicians know this, there will be a small noise coming from those not enamored by tv or the divine right of Kings.
Family guy bird...
The law defends the plunderer...
---
You can say that again.
---
Stewie sticks the gun in his mouth at the end...
http://www.fraudforeclosure.com/
http://www.bloomberg.com/news/2010-10-06/ally-sued-by-ohio-over-alleged-fraud-in-mortgage-foreclosure-documents.html
http://fridayinvegas.blogspot.com/2010/10/kid-dynamite-slaughters-cow.html
It's not a joke...econ blogger kid dynamite does slaughter a cow...photos are graphic...
CR Note: This is from economist Tom Lawler, who joked today: Maybe large servicers should be forced to put up billions in "claims fund," like BP? (the latter "caused" slime, while the former are just "slimy"!)
The mortgage-foreclosure debacle, which started with a story about a GMAC “technicality” (and included a “GMAC denies foreclosure moratorium” story) but which quickly “ballooned” as more mortgage servicers were “implicated,” has now exploded into a full-blown “issue” of unknown proportions. One thing is pretty clear – many larger mortgage servicers simply “screwed up” by trying to deal with the surge in foreclosures by taking shortcuts to keep costs down, and this mistake has blown up in their faces.
http://www.calculatedriskblog.com/2010/10/lawler-foreclosure-gate-who-will-and.html
Without clear title, foreclosing parties cannot establish standing. No standing means there's no case or controversy, and the court lacks jurisdiction to hear the suit in the first place. A couple of points here.
First, it means a lot of prior foreclosure judgments are flat out void.
Second, while the court may lack jurisdiction over the foreclosure dispute, it retains jurisdiction over fraud and has the power to assess attorneys fees and costs against the foreclosing party.
See for example http://www.msfraud.org/law/lounge/U.S.BankvHarpster.pdf at p. 3.
In general check out http://www.msfraud.org/law/lounge/Standing.html and just read a few decisions (they're usually short) to get a feel for how nasty this foreclosure mess may get.
As Karl Denninger has been stating, the original documents MUST BE LOST...otherwise they would be using them...
MERS is being remarkably silent...the very real possibility exists that none of the original documents have been saved...that they're all lost...it threatens to be a shitstorm followed by a tsunami...
Ugly....
I wonder if pressure from corporate interests or crooked politicians has anything to do with that.
It's not simply loss of my home that ‘eats my lunch’, it's such things as horrible, horrible YEARS of judicial abuses, privacy invasions, danger for my safety, blackballed from LAW employment, and other reprisals to which I am yet subjected, due to APPALLING LAND GRAB racketeering (AKA) foreclosure. And, it is similar appalling injustices of which I know have happened to other people, merely because they also lawfully sought their rights to DUE PROCESS OF LAW. I will not cease speaking out / I’m not an Internet troll. I am doing every lawful thing I know, because I simply want MY LIFE BACK. *http://www.lawgrace.org/2010/09/30/important-facts-about-foreclosure-and-mortgage-fraud/
And thanks to Seeking Alpha who picked up this story and has placed it on their front page...
http://seekingalpha.com/
Unfortunately that is how Main street feels while watching Wall street get breast fed at their expense.
Do you have a case number for your case in federal district court? For example 08-0079.
I'd like to check out some of your allegations on PACER. Litigation tends to crystallize issues.
I checked her link too. Pro se litigants frequently fuck up basic shit. I suspect that's the case here. What intrigues me is her energy and resolve. We'll see.
Fuck it. I'm in NC this weekend hanging with homies who still bite on the left-right puppet show. It's football, though, I guess I shoukd rejoice.
---
tell me about it...i can't even get my girlfriend to break loose from the lies...
---
I hope your girlfriend doesn't read The Bail ;-)
Because for more than 5 years, I have been sounding the alarm about FORECLOSURE DEBT COLLECTION abuses, I’m glad the fantastic occasion to expose the NUTS & BOLTS of the most ominous element of foreclosure fraud has finally come! I call it “the ELEPHANT IN THE ROOM! I hope the Florida's Attorney General prevails in investigating foreclosure mill firms who CLEARLY fabricate foreclosure documents!!
It is imperative that MILLS are investigated for INTENTIONALLY FABRICATING court documents because certain lawyers are engaged in SELF-DEALING FORECLOSURES. Most definitely, it is NOT A WASTE OF TAX PAYER MONEY to probe awful, underhanded illegalities surrounding foreclosures which have caused thousands of people to be UNLAWFULLY evicted and homeless –while unscrupulous lawyers became CRIMINALLY ENRICHED.
LONGSTANDING foreclosure frauds incorporate false CIVIL as well as BANKRUPTCY court pleadings; repetitive and illegal property flipping (thus blighted neighborhoods); “simulated auctions” and “straw buyers”; FALSE “lift stay” motions and FALSE “proof of claims;” and "fee-splitting." Certain lawyers achieve extra benefits from litigating foreclosure defense lawsuits, and MISREPRESENT to their mortgage-clients that homeowners are delaying foreclosures, but actually its continual deceptive lawyers' activities –while billing $$$$ to clients and actually committing MALPRACTICE + fraud upon the courts + fraud & illegal exploitation of homeowners!
Because fraudulent foreclosures include many facets, culmination can take years while arranging cash cow “PAWNS” needed for big pay-offs. [Super Future Equities Inc. v. Wells Fargo, et al., @ http://www.bankruptcy-lawnetwork.com/2007/05/11/what-are-those-mortgage-servicers-doing/.
LIKE AMERICA NEED JOBS, FORECLOSURE MILLS NEED INVESTIGATION. State Attorneys General everywhere now need to recognize the ELEPHANT IN THE ROOM –which has been for a long time, hiding in plain sight: foreclosure mill fraud! *http://www.lawgrace.org/2010/09/30/important-facts-about-foreclosure-and-mortgage-fraud/