NYS F'closure Mill, MERS Named In Class Action Racketeering Suit; Action Seeks To Void "Tens Of Thousands" Of F'closures, Impose Million$ In Punitives

From a press release from New York City attorney Susan Chana Lask:

• On August 17, 2010, attorney Susan Chana Lask filed a Federal Class Action Complaint on behalf of tens of thousands of New York State homeowners who lost their homes to an alleged foreclosure fraud orchestrated for years by a New York “foreclosure mill” attorney and major mortgage companies. The case is filed in the US District Court, Eastern District of New York, entitled “Connie Campbell against Steven Baum, MERSCORP, Inc, et al.”, Case #10CV3800.

• It alleges RICO civil racketeering, RESPA, Fair Debt Collection Practices Act violations and that homeowners paid inflated foreclosure and other fees fictionalized by Mr. Baum who profited from the scheme since 2005. The action seeks to return tens of thousands of foreclosed homes to their owners or the values thereof and hundreds of millions in punitive damages against Mr. Baum, MERSCORP and HSBC.

• Attorney Susan Chana Lask discovered the alleged foreclosure scheme after her client lost her 1.7 Million Dollar Brooklyn Caroll Gardens Brownstone home to a $190,000 mortgage foreclosure filed by attorney Steven Baum for HSBC. The foreclosure court filings were false as filed in HSBC v. Cncepcion Campbell, et al, New York Supreme Court, Kings County, Index #20393/07.

• Steven Baum’s foreclosure complaint he filed was for HSBC against Ms. Campbell . It admits the loan was never assigned to HSBC, yet he sued for HSBC. A later Satisfaction of Mortgage was not filed for HSBC but for a company named MERS, admitting HSBC never owned the loan and the foreclosure complaint should have never been filed in the first place. The actual Mortgage was always in MERSCORP's name and never assigned as required by law. Just who owns the loans Steven Baum forcloses on is a deliberate mystery and potentially tens of thousands of New York homeowners lost their homes on a mystery.

• But there's more. The documents filed in the Courts are signed by attorneys from Mr. Baum's office under penalty of perjury that they are filing with knowledge of the transaction; however, they have no knowledge as they admit they do not have the documents they attest to in their office. In fact, in the later case filed of [plaintiff] Concepcion Campbell [...], New York Supreme Court, Kings County, Index # 08-3467, when Ms. Lask subpoenaed Mr. Baum's firm for the original Note, they responded it was not needed and refused to produce it; implying they never had it yet they swear they reviewed it in their court filings "under penalty of perjury."

• Also, in the original foreclosure case of HSBC, they file documents by an alleged officer of MERS named Rebecca A. Cosgrove by a notary in "Erie County". But MERS is located in Virginia and Erie County is in Buffalo New York where Steven Baum's office is. It is suspect that Ms. Cosgrove is even an officer of MERS, no less that she flew all the way to Buffalo NY for the day just to sign a document before a notary. In fact, other courts recently discovered these same false notaries and "officer" claims in other cases involving Mr. Baum and MERS.

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• Courts blast Mr. Baum for his sloppy filings claimed to be deliberate to hasten foreclosures on unwitting homeowners and courts. On July 29, 2010 NY County Supreme court Judge Alice Schlessinger summed up a MERS foreclosure as “I am unable to say with any confidence that this was an honest transaction." (Index #109824/05).(1) The Manhattan US Trustees office started an investigation of Steven Baum months ago.

For the entire press release, see Class Action RICO Suit Alleges Tens of Thousands of New York Foreclosure Frauds Orchestrated by "Foreclosure Mill" Attorney & Banks (Hundreds of Millions in Damages Demanded for New York Homeowners).
For the lawsuit, see Campbell v. Baum, et al., Case #10-CV-3800 (E.D. N.Y. August 17, 2010).
(1) See Mortgage Elec. Registration Sys., Inc. v Folkes, 2010 NY Slip Op 32007(U) (NY Sup. Ct. New York County, July 21, 2010). Justice Schlessinger summarizes her decision in this particular case in the following excerpt (bold text is my emphasis, not in the original text):

• I am not prepared to grant plaintiffs cross-motion for summary judgment. Beyond that and despite the fact, as counsel points out, that Folkes does not oppose their motion, I am dismissing the action. I am doing this for essentially three reasons. Some of which has to do with deficiencies in documentation.

• Even without opposition, a plaintiff in a foreclosure action must satisfy a court that it has proper standing or title to bring the action, that the mortgage and note was actually funded by the plaintiff, and that the transaction itself, the one sued upon, has the indicia of reliability and is free of fraud. Kluge v Fugazy, 145 AD2d 537 (2nd Dep’t 1988); Katz v East-Ville Realty Co, 249 AD2d 243 (1st Dep’t 1998). None of those criteria have been satisfied here.