What's that strange thing that I smell in the wind? Could it be the smell of Justice coming home to America?
These two stories are all over the web, but I wanted to make certain that my friends here on DailyKos got the news, and of course hopefully will spread the word.
First off, New York Attorney General Eric Schneiderman is going after Bank of America big time. I reported on him in a diary a few weeks ago, as did Matt Taibbi, and I still refuse to give up hope on our nation. I hope you might feel the same way. I have written to the AG Eric Schneiderman to give him my full support and I hope you will too. I'm not even a New Yorker, but there is much more at stake here than we may realize.
Wow, new stuff coming our fast and furious on this continuing story:
NEW YORK -- Bank of America, the largest U.S. bank by assets, "significantly hindered" a federal investigation into the firm's faulty foreclosure practices on potentially billions of dollars worth of taxpayer-backed loans, a federal auditor told an Arizona court.
The bank withheld key documents and data, prevented investigators from interviewing bank employees or asking certain questions, and was slow to provide information, according to a June 1 declaration by William W. Nixon, a fraud examiner and assistant regional inspector general for audit for the U.S. Department of Housing and Urban Development inspector general's office. Bank of America, the largest handler of home loans in the U.S., threw up roadblocks to the investigation, Nixon said, like preventing his team from performing a "walkthrough" of the bank's documents unit. The bank also failed to fully comply with subpoenas issued by Nixon's team. HUD's internal watchdog issued two subpoenas requesting documents and information, and what was returned was incomplete, had conflicting information, and in some cases, the bank provided excerpts of documents rather than the complete record. Federal investigators found one bank employee who signed more than 75,000 foreclosure documents over the two-year period. If the employee worked every day during those two years, that amounts to about 103 documents signed per day, or one every five minutes.
Another Bank of America employee was found to have signed nearly 47,000 foreclosure documents over the examined period, which amounts to about 64 documents signed per day, or one every seven minutes.
OMFG. The Hoover Damn of the entire scandal is breaking big time, and it's about time it did.
Know this much: if you do not have a clear title on your property, then guess what? You can never sell it it. Got that yet? If you do not have a direct link to the Title companies and Insurance companies and State's rights to your property then your 'note' on your property is a worthless piece of shit. Got that yet? This is what the MERS Whiitewash has been all about, and this is why the gutless and creepy greedy asshole, AG Tom Miller of Iowa (who was heading up the other 49 State US AG's so call deal with the Banks, has fallen apart at the seams, and I'm glad that it has.)
This is the very reason I actually believe in, and HOPEFULLY so should you, to get behind AG Eric Schneiderman of New York. This is indeed how a real 'grassroots movement happens in out nation,' and make no mistake about that. If you have had the courage to move your money out of the too big to fail Banks, than I beg you to support this new movement too.
The investigation, which began quietly in recent weeks, is part of a larger inquiry that is scrutinizing whether mortgage companies and Wall Street firms took the necessary steps under New York state law when creating mortgage-backed securities, these people said, who requested anonymity because they weren't authorized to speak publicly about the probe.
The inquiry could prove explosive: Wall Street's great mortgage securitization machine took millions of home loans and bundled them into securities for sale to investors. If the legal steps that guide securitization -- like taking mortgage documents from one party to another, a critical step under New York law -- were not undertaken, then the investors who bought the bundled loans could force the companies to buy them back, compelling them to eat enormous losses. New York state investigators could also find that those securities aren't valid financial instruments at all and take action under state law.
"If mortgages were not properly transferred in the securitization process, then mortgage-backed securities would in fact not be backed by any mortgages whatsoever," Adam J. Levitin, a bankruptcy expert and professor at Georgetown University Law Center, said at a House panel last November. Levitin said the problem could "cloud title to nearly every property in the United States" and could lead to trillions of dollars in losses. The six largest U.S. banks, including Bank of America, Goldman and Morgan, currently hold nearly $668 billion in so-called Tier 1 capital, cash banks are required to hold as a backstop against unforeseen losses, Federal Reserve data as of March 31 show. All six companies are defined as "well capitalized" by federal bank regulators. Schneiderman's inquiry also raises questions about the speed the Obama administration and a coalition of state attorneys general and bank regulators are moving towards a settlement agreement to resolve claims of widespread foreclosure abuse.
And you know that last sentence says it all:
Schneiderman's inquiry also raises questions about the speed the Obama administration and a coalition of state attorneys general and bank regulators are moving towards a settlement agreement to resolve claims of widespread foreclosure abuse.
The truth of the matter, is that AG Eric Holder has been given every single opportunity to go after these Banks and Mortgage companies and what he is really doing is nothing. He is waiting for the Statue of Limitations to run out the game.
As one of my favorite writers over a FDL says about Schneiderman's latest move:
This is an ENORMOUS deal.
This is an ENORMOUS deal. Schneiderman is looking at the failure to properly convey notes and mortgages to the securitization trusts, which court records clearly show was practically the industry standard during the housing bubble. Abigail Field’s work looking at just a handful of mortgages in one district court showed a perfect record of failure. These trusts were strictly time limited under New York law, and there’s no way for the banks to really make this right. By the way, the mortgages Field looked at had Countrywide as the originator. Countrywide is now part of Bank of America.
If this plays out as it could, Schneiderman could declare these securities invalid under New York trust law. There would be a lawsuit in response, of course, but the exposure of Bank of America for this claim is massive, potentially bigger than their capital reserves. Pretty much every investor in a BofA MBS would demand their money back on the faulty security. Not to mention the inability to foreclose on borrowers because of the lack of proof of ownership of the loan. We’re talking about trillions of dollars in losses on millions of loans with no true owner. It’s a nightmare scenario for the banks.
UPDATE: Gretchen Morgenson reports that Schneiderman and Delaware AG Beau Biden (the VP’s son) are investigating securitization fail at Bank of New York Mellon and Deutsche Bank. These were two of the bigger trustees, who had the responsibility of properly packaging mortgage backed securities.
Major hat tip to David Dayen, a major awesome writer on the financial front over at FDL. Loves ya David if you are reading this!!!!
For a full run down and a wonderful highly detailed update of these events, might I suggest that you take the time to read Yves Smith's great article today?
Finally, another very appreciated hat tip to my good friend Dburn, for turning me on to this major piece of welcome news as to the on-going bullshit of the MERS White Washing Machine that is falling apart.
Appeals Court Clarifies MERS Role in Foreclosures
The ubiquitous Mortgage Electronic Registration Systems, nominal holder of millions of mortgages, does not have the right to foreclose on a mortgage in default or assign that right to anyone else if it does not hold the underlying promissory note, the Appellate Division, Second Department, ruled Friday. "This Court is mindful of the impact that this decision may have on the mortgage industry in New York, and perhaps the nation," Justice John M. Leventhal wrote for a unanimous panel in Bank of New York v. Silverberg, 17464/08. "Nonetheless, the law must not yield to expediency and the convenience of lending institutions. Proper procedures must be followed to ensure the reliability of the chain of ownership, to secure the dependable transfer of property, and to assure the enforcement of the rules that govern real property." The opinion noted that MERS is involved in about 60 percent of the mortgages originated in the United States.
More on this article here:
Again, can I say: It's about fucking time. I never believed for a minute that the Banks and the epic Fraud Machine of the Mortgage industry was going to get away with what they were pulling. This goes to the very heart of what is known as State's rights for centuries of precedents based on basic contractual laws.
And BTW, this is the exact same argument that Senator Carl Levin and his own bi-partisan committee made after their own two year investigation that gave everything AG Eric Holder ever needed to go after these same fucking crooks and liars that destroyed our national economy.
So here is the message:
You are the change you have been waiting for, and there is no other excuse left in our empty bag of tricks to blame it on anyone but ourselves if we do not support this brave man, AG Eric Schneiderman of New York.
Someone has to light the candle back to sanity, why not him? Who else will?
The easy way out is to give into our own apathy and despair, and I for one refuse to let you do that. I lift you up, as you have lifted me up, and that is how the Democrats work together. Our party is bigger than the President we elect, it is about the spirit or our party and the Unions that built out nation. I ask and beg you all now, not to lose hope when we need it the most.
Yes, we've been punched more than a few times these past few decades, but it does not mean we can't come back from these hard times. I refuse to believe in that. I refuse to let either the Media or the Supreme Court or anyone else take the spirit of our people away from their hearts and minds. I refuse that.
Keep the faith, don't give up the hope. The dream lives on as Teddy Kennedy said.
Sometimes, a single light of a candle can light the entire world all a new, and I hope that all of you will fully support AG Eric Schneiderman of New York.
You can voice your support of him here:
Contact the Attorney General
On this page, you will find information to help you contact Attorney General Eric T. Schneiderman and key links for reaching the Attorney General's Office.
To contact our office by phone, please call one of our hotlines:
General Helpline: 1-800-771-7755
To contact our office by mail, please write to:
Office of the Attorney General
Albany, NY 12224-0341
"Americans are reducing mortgage payments at a record clip, directing cash that once went for debt into consumer spending and savings. Low interest rates, defaults and refinancings have shaved more than $100 billion off the nation's annual mortgage bill — an amount comparable to all unemployment benefits for one year or this year's Social Security payroll tax cut.
Homeowners have trimmed interest payments alone by 11% — or $67 billion a year — from the peak in 2008, according to the Bureau of Economic Analysis (BEA). The savings come equally from grabbing lower interest rates and reducing what's owed by paying down principal or defaulting on loans. The nation has slashed total mortgage debt from nearly $11 trillion at the mid-2008 peak to $10.3 trillion in the first three months of 2011, the BEA reports."
These graphs are shocking. The total numbers showing that 22.7% of all houses with a mortgage being underwater is bad enough, but look at how many are over 25% underwater. Almost 10% or about 4.6 million homes are more than 25% underwater. Guess what? These are future foreclosures.
There is already 4% to 5% more houses on the verge of being underwater and with the recent acceleration in home prices lower, you can be sure they are there already. At the current rate of decline in home prices, at least 30% of all houses with a mortgage in the country will be underwater by this time next year. And Ben Bernanke expects the economy to improve in the 2nd half.
I find it amusing that there are now 48 million homes in the US with a mortgage. A few years ago, that number was 54 million. I wonder what happened to those 6 million homes? Any guesses?
But hey, don't forget this single fact: how many of these homes have a clear title?
First they came for our homes, then they came for our savings and our pension funds, then they came for our Unions, then they destroyed our economy (and got paid off for doing so) and destroyed our jobs, and gave us all bullshit half assed payoff to a fake HCR bill and a Financial Reform bill. Now 'they,' are coming after the final safety net: Social Security and Medicare.
I've had enough, have you?
Thanks as always.