Wednesday, January 04, 2012

Pennsylvania Man Gets 81 Months For Using Fraudulent POAs To Pocket Cash From Refinancing Homes Owned By Elderly Parents, Other Family Members

From the Office of the U.S. Attorney (Philadelphia, Pennsylvania):
  • Anthony Iacono, Jr., 60, of Rutledge, PA, was sentenced [] to 81 months in prison for fraudulently obtaining over $2 million in cash, and real and personal property, announced United States Attorney Zane David Memeger. Iacono pleaded guilty to wire fraud, credit card fraud and aggravated identity theft charges on August 19, 2010.


  • Judge Bartle described the actions of the defendant as committed with a "depravity of heart and mind." Iacono fraudulently obtained over $2 million in loans secured by properties owned by his parents and other family members using fraudulent powers of attorney and credit cards in the names of relatives and businesses owned by relatives.


  • To obtain the credit card used in the identified credit card transactions, Iacono used the victims' names, dates of birth and social security numbers without permission. When he failed to pay the loans, his family bore the brunt of the lenders efforts to recover their money.


  • In addition to the prison term, U.S. District Court Judge Harvey Bartle III ordered forfeiture and restitution in the amount of $2,098,000. There was no fine imposed because the Court found the defendant without means to pay one.

Source: Pennsylvania Man Sentenced For Identity Theft.

Financially Strapped Seniors Selling Off Pension, Retirement Payments To Meet Pressing Cash Needs?

In Greenville, North Carolina, The Daily Refector reports:
  • Many people are doing whatever they can to make it to the next mortgage payment or bill paying day. In some cases people face foreclosure on their homes and need a large cash payment in order to stop the bank.


  • Retirees and veterans who have a defined benefit pension now have another opportunity to get a lump sum payment but it does have a significant downside. They can sell the future stream of monthly pension payments to an investor who will provide a single lump sum of money in return.


  • This use of the secondary market has become very attractive for many investors. One feature of the pension investment is that the retiree signs a contract that yields a 5-6 percent interest rate for the purchaser. These transactions also are facilitated by websites that seek retirees willing to sell their pensions. These middlemen bundle the pension investments and send a sheet showing all available options to investors. The investor works through the middleman in completing the purchase transaction.


  • For this service the middleman agency collects a sizeable fee that is taken out of the stream of payments. Although the stated interest rate may only be 5-6 percent for the investor when the cost of middleman fees are added the effective interest rate is considerably higher.

***

  • Congress has [] taken notice of the pension purchasing business. Sen. Tom Harkin of Iowa heads a U.S. Senate committee that is investigating the pension-for-cash contracting business.


  • He is concerned that retirees are not fully aware of just how much interest they are paying as a result of signing away pension payments. There also is concern that retirees who are desperate have not thought through the effect of losing monthly payments.


  • Even though the Senate investigation is in its infancy, the business of purchasing pensions is not. It is moving forward just as fast as investment firms can find new methods of advertising it.

For more, see Pension payments sold to middlemen.

Cops Begin Meeting With Local Homeowners, Residents To Address Concerns Over Adverse Possession-Claiming Squatters

In Douglasville, Georgia, The Holly Springs-Hickory Flat Patch reports:
  • Members of the Douglasville Police Department and the Douglas County Sheriff's Department have scheduled a meeting on Jan. 3 with homeowners and residents that are concerned with squatters.


  • Squatters have been using Georgia's adverse possession law, which is meant to resolve property disputes, to live in empty houses that are in a state of limbo. The process takes advantage of the high number of foreclosures and abandoned houses in recent years.


  • "We want people to feel more comfortable and want them to know what to look for," said Det. Mac Abercrombie of the Douglasville Police Department. "We see a problem and want to help address a need.


  • "We've been taking a pro-active approach to this problem," said Det. Mac Abercrombie of the Douglasville Police Department. "We've been planning this since October. This is not a reaction to recent stories in the news."

For the story, see Police Meet with Residents to Answer Squatting Questions (Members of the Douglasville Police Department and the Douglas County Sheriff's Department have scheduled a meeting on Jan. 3 with homeowners and residents that are concerned with squatters).

Tuesday, January 03, 2012

Texas Man Agrees To Plea Guilty In Fractional Interest Deed Transfer Foreclosure Rescue Scam

In Austin, Texas, the Austin American Statesman reports:
  • A Lakeway man who has been accused of fraudulent business dealings at least twice has agreed to plead guilty in a new investigation involving allegations that he was paid to fraudulently delay foreclosures on behalf of distressed property owners, according to court documents.
  • Frederic Alan Gladle, 53, is in jail awaiting his guilty plea to charges of bankruptcy fraud and aggravated identity theft. That plea is scheduled for Friday . He faces two to seven years in prison.
  • From 2007 until his arrest in October, Gladle operated a business that helped distressed property owners delay foreclosure by paying a monthly fee — usually about $750 a month, according to prosecutors and charging documents.
  • After clients signed up for his services, one of Gladle's salespeople had them sign deeds transferring a fractional share — usually one one-hundredth — of their distressed property, the documents said.
  • The shares were transferred to an unrelated person who had previously filed a bankruptcy petition in court, the documents said. Those people were unaware that Gladle was using their names, which were obtained from online court records, the documents said.
  • Gladle, or "a co-schemer operating at his direction," would then send a copy of the fractional deed and a copy of the unrelated person's bankruptcy petition to the lender that was expected to foreclose, the documents said.
  • Because bankruptcy proceedings automatically delay foreclosure actions, the lender would not be able to immediately foreclose on Gladle's client's property, the documents said.
  • Eventually, after the unrelated debtors claimed they knew nothing about owning the fractional interest, the foreclosure continued, according to the documents.
  • Gladle would then go through the process again, causing further delay, the documents said. Through the course of the scheme, Gladle and his unnamed associates collected $1.6 million from clients and delayed the foreclosure sales of more than 1,100 properties, the documents said.(1)
For the story, see Lakeway man to plead guilty in scheme to delay foreclosures.

(1) See Final Report Of The Bankruptcy Foreclosure Scam Task Force for a discussion of fractional interest deed transfer scams and other foreclosure rescue rackets involving the abuse of the bankruptcy courts.

Citi Calls Off Erroneous Foreclosure, But Refuses To Bear Costs Incurred For Its Own Screw-Up

In St. Louis Park, Minnesota, the Star Tribune reports:
  • In a last-minute move, Citi- Mortgage called off the foreclosure sale of a St. Louis Park house whose owner battled to stay in her home with the support of the Minnesota attorney general.


  • Nancy Gosselin was scheduled to lose her house in a sheriff's auction scheduled for Tuesday, even though an investigation by the attorney general determined that at most, she had missed one payment of $584 more than two years ago. After Gosselin was featured in a Whistleblower column on Nov. 13, CitiMortgage postponed the foreclosure for a month. Then, this week, Gosselin got the good news.

***

  • A receptionist at Sela Roofing, Gosselin refinanced her house with Bremer Bank for a $84,100, 20-year mortgage in 2005. Then the mortgage was sold to CitiMortgage. Gosselin said she never missed any payments, and a loan officer at Bremer Bank agreed. Yet CitiMortgage began assessing monthly late fees on the Xenwood Avenue house, which she repeatedly contested, and last spring the company refused to accept Gosselin's monthly payments and took action to sell the house at foreclosure.

***

  • In a letter to William Gosiger of the attorney general's office, Susie Birmes of CitiMortgage's Executive Response Unit said it was waiving the late fees, reinstating the loan and canceling the foreclosure. But she said it was not waiving "foreclosure costs and attorney fees in the amount of $2,140.11," which "can be paid at any time during the life of the loan and will be required to pay ... in full, upon payoff."


  • Gosselin remains furious about those charges and says she will not pay them. CitiMortgage can pay their legal fees out of their bailout money," she said. Her Bremer Bank loan officer, Stephan O'Connor, said she should not have to pay them, because she was not at fault.


  • "If they are pursuing those [attorney fees], we will continue to go to bat for the homeowner to see whether the fees can be waived or reduced," said Ben Wogsland, a spokesman for Minnesota Attorney General Lori Swanson. "It's good that Ms. Gosselin will be able to stay in her home, that the sheriff sale has been called off and the loan has been reinstated."


  • Nick Slade, a Minneapolis attorney who works on foreclosure cases, said it takes an enormous amount of time, energy and resources on the part of numerous people to get something done for a homeowner fighting foreclosure. "It's only when you bring in the level of firepower that happened in this case that they pull it out of the nightmare bin in the regular process and give it to somebody and really truly handle it in a way that makes sense," Slade said.

For the story, see Whistleblower: With help on high, foreclosure avoided (St. Louis Park woman has mortgage reinstated, but CitiMortgage still wants fees for its attorneys and foreclosure costs).

Maryland High Court: Criminal Conviction Invalid For Builder Who Accepted Cash From Customers, Then Failed To Deliver Homes

In Prince George's County, Maryland, The Washington Examiner reports:
  • Maryland's highest court has affirmed the reversal of a theft conviction for a builder sentenced to 12 years behind bars for failing to construct Upper Marlboro homes he had contracts to develop.


  • The Maryland Court of Appeals upheld a lower appellate court's decision to overturn Leon T. Coleman's June 2009 conviction in Prince George's County on charges of theft by deception and failing to deposit money into an escrow account.


  • The "evidence was insufficient to conclude that Coleman intentionally deprived the buyers of their property," the Court of Appeals opinion says.


  • The saga began in 2004, when Coleman entered into contracts with 10 families to build homes in an Upper Marlboro subdivision. The contracts said the buyers would purchase lots before their homes were built, according to court records. The buyers obtained loans for the purchases; Coleman used some their initial payments to buy the lots and put the rest in an escrow account, court documents say.


  • But he never went forward with construction because he ran out of money before he could obtain the necessary permits.


  • Prosecutors contended that Coleman never intended to build the homes, saying he didn't use the initial funds for construction and made "misrepresentations" about the development's progress. But that doesn't constitute theft, the appeals court said. "When a defendant has a right to receive money or property, he cannot be guilty of stealing it," the opinion says.


  • The prosecution also argued that Coleman's failure to spend some of the funds he received implies that he kept the money for himself or spent it improperly. The appeals court, however, said there was no evidence that Coleman used the money for anything other than the construction project.


  • Coleman was the first person prosecuted for building violations in Prince George's County under Maryland's Custom Home Protection Act, which requires builders to place advance payments in escrow accounts.


  • But because the buyers received the property deeds before the homes were built, the act isn't relevant, according to the appeals court. The court said the act "does not apply when a builder or vendor deeds land without a home on it."


  • Emma Coleman, the builder's wife, was also initially charged in the case, but the accusations against her were dropped.

Source: Maryland court affirms reversal of builder's theft conviction.

Monday, January 02, 2012

Bankruptcy Court Watchdog In Ongoing Probe Into Allegations Of Foreclosing Banksters' Mortgage Escrow Fee Double Dipping Yielding Million$ In Profit$

In New York City, the New York Post reports:
  • Federal investigators are looking into allegations that banks have wrongly pocketed tens of millions of dollars from troubled homeowners by double-billing for mortgage escrow fees, The Post has learned.


  • Exactly how much in phony profits the banks may have pocketed from this alleged practice is not known, but an analysis by The Post of bankruptcy cases in 2011 shows it could range higher than $150 million for just the new cases filed this year.


  • The problem has gotten so out of hand that lawyers and accountants at the New York City office of US Trustee — charged with protecting the integrity of US bankruptcy courts — are poring over local Chapter 13 bankruptcy cases for evidence of wrongdoing.


  • The federal investigators were tipped to the alleged practice by metro area bankruptcy lawyers. Cases specifically involved Wells Fargo and GMAC Mortgage, but lawyers say most banks had double-dipped.


  • It seems prevalent, and it’s a moneymaking machine,” David Shaev, a Manhattan bankruptcy defense lawyer, said of the banks’ double-dipping.


  • Westchester bankruptcy defense lawyer Linda Tirelli says 75 percent of her clients face escrow double-billing by their lender or mortgage servicer, for amounts up to $2,800.


  • Here’s how the double-dipping scam can be pulled off. Many homeowners opt to pay part of their property taxes and homeowners insurance with their mortgage every month. The funds are then put into an escrow account and used to periodically pay the taxes and insurance.


  • But after falling behind on a few payments, troubled borrowers in Chapter 13 often find that their bank or mortgage servicer tries to collect twice on the escrow funds — once as part of the overall mortgage payment, and again as a separate “escrow shortage” charge.


  • The average double charge is about $2,000, said forensic accountant Jay Patterson of Full Disclosure in Arkansas, who sees escrow issues in half the cases he examines. In 2011, there were 362,000 Chapter 13 cases filed nationwide, according to the National Bankruptcy Research Center. If three-quarters of those cases involved homeowners, and even one-third of that subset of cases had extra escrow charges of $2,000, then banks clobbered homeowners with an astonishing $179 million in false charges.


  • Following on the heels of the widespread robo-signing scandal — where executives signed reams of foreclosure paperwork without reviewing it — the escrow double-dipping is just another example of the shoddy if not outright fraudulent practices by banks thirsty for profit above all else.

Source: Sloppy seconds: Feds probe million$ in 'double-billing' by banks.

Florida Supreme Court Slams Six Attorneys In 'Sticky Fingers' Syndrome Cases

The Florida Bar has recently issued its quarterly gossip sheet, listing Florida attorneys that have recently received one or more forms of discipline.

Among those making this quarter's hit parade for possibly playing fast and loose with the cash sitting in their client's trust account, or who otherwise suffered from 'sticky fingers' syndrome with regard to other people's money, are:

  1. Ryan Scott Hobby, 836 W. Montrose St., Suite 1, Clermont, suspended until further order, following an October 6 court order. (Admitted to practice: 2005) According to a petition for emergency suspension, Hobby appeared to be causing great public harm by misappropriating client trust funds. Hobby admitted through counsel to making 13 improper transfers from his trust bank account to another bank account totaling $14,250. (Case No. SC11-1886)


  2. John D. Hooker, 13610 E. U.S. Highway 92, Dover, suspended until further order, following an October 10 court order. (Admitted to practice: 1974) According to a petition for emergency suspension, Hooker appeared to be causing great public harm by misappropriating trust funds. Hooker improperly commingled funds. He also failed to maintain certain trust accounting records and follow mandatory trust accounting procedures. (Case No. SC11-1766)


  3. James Lewis Hunter, 150 2nd Ave. N., Suite 1170, St. Petersburg, suspended until further order, following an October 10 court order. (Admitted to practice: 2004) According to a petition for emergency suspension, Hunter appeared to be causing great public harm by misappropriating client trust funds. He also abandoned his law practice. (Case No. SC11-1919)


  4. James Crenshaw Kelley, 12651 S. Dixie Highway, Suite 201, Pinecrest, suspended until further order, following an October 31 court order. (Admitted to practice: 1977) According to a petition for emergency suspension, Kelley appeared to be causing great public harm by misappropriating and/or diverting funds entrusted to him. Kelley disbursed more than $124,000 that was deposited into his trust account for a client’s benefit, to himself for personal use. Kelley subsequently wrote the client, begging her not to report his actions to The Florida Bar. (Case No. SC11-2035)


  5. Octavio Enrique Mestre, 9031 S.W. 162nd Court, Miami, disbarred following an October 11 court order. (Admitted to practice: 1992) In 2005, while acting as a settlement agent in a real estate transaction, Mestre failed to satisfy an underlying mortgage and in so doing, failed to preserve and apply the funds in accordance with Bar rules regulating trust accounts. (SC11-1867)


  6. Gregg Adam Steinberg, 4441 Comanche Trail Blvd., Saint Johns, disbarred effective retroactive to August 30, 2010, following an October 7 court order. (Admitted to practice: 1993) Steinberg knowingly made false statements in court under oath; he failed to disclose that he was the subject of a pending criminal investigation; he misappropriated funds; and he engaged in a pattern of blaming others in an attempt to deflect attention from himself. (Case No. SC10-161)

In addition, one attorney received a scolding for associating himself with a loan modification group and sharing fees with nonlawyers:

  • Curt G. Levine, 5036 Dr. Phillips Blvd., Suite 358, Orlando, publicly reprimanded following an October 6 court order. (Admitted to practice: 1973) Levine associated himself with a loan modification group and shared fees with nonlawyers. (Case No. SC10-536)

For the entire gossip sheet, see Disciplinary Actions (1/1/2012).

Wanna-Be House-Buying Couple Left Holding The Bag In Rent To Own Scam Involving Home In F'closure; Attorney: 'Protect Yourself - Get A Title Search!'

In Columbus, Ohio, WBNS-TV Channel 10 reports:
  • With the real estate market down, and some financial problems in the past, the Kaiser family decided they would try to find a home with a lease-option to buy, Consumer 10’s Kurt Ludlow reported on Friday.


  • Sandy and Tim Kaiser rented a condo, with a promise from the owner that he would sell them the condo in a few years. He promised to pay the association fees and the mortgage during that time. The Kaiser’s eventually discovered that the condo was in foreclosure.


  • I’m trying really hard not to be bitter about the fact that I think he knew from the beginning that he wasn’t going to be making his payments,” Sandy Kaiser said. “I think he just booked.”


  • Lawyer Gary Price said what happened to the Kaisers could have been prevented if they had used a lawyer. “Lease to own, it's not the end of the world,” Price said. “Land installment contract's not the end of the world. But comply with the law."


  • Under the law, any deal to sell property, even leasing to own, must be in writing, witnessed and notarized, Price said. "Find out who you're dealing with,” Price said. “Best way to do that, safest way to do that, and yes it costs a little money, is to get a title search.” Finally, the contract must be filed with the County Recorder, Price said.


  • The Kaiser family said that they are waiting for the Sheriff to knock on their door. “I (have to) keep paying him, and he's already stealing from the bank is the way I look at it,” Tim Kaiser said.

Source: Risk Incurred In Renting To Own.

Sunday, January 01, 2012

Minnesota Regulator Slams Loan Modification Racket For Clipping Desperate Homeowners For Illegal Upfront Fees; Victims To Get Refunds

In Bloomington, Minnesota, the Star Tribune reports:
  • State regulators have yanked the license of a Bloomington mortgage modification company it says was preying on desperate homeowners.


  • Mortgage Connection Inc., also called Mordicorp, didn't have the appropriate license, altered documents and charged illegal advance fees for loan modification services that it frequently failed to provide, the Commerce Department said Thursday. In some cases, the consumers fell behind even further on payments and are losing their homes in foreclosure.


  • Thirty-six consumers, including about 19 in Minnesota, were charged on average more than $2,000 in advance fees for modifications they didn't receive. They will get refunds within the next 30 days, the department said.


  • "Time and time again we see vulnerable homeowners turn over their last dollar in hopes that their homes might be saved," state Commerce Commissioner Mike Rothman said in a statement.


  • The company's license has been revoked and its president, Augustus Odoom, has been barred from originating or servicing mortgages and must pay a civil fine of $40,000 if he doesn't return fees to customers, among other things, according to the consent agreement signed last week. Odoom, 58, is recently of Eden Prairie.

For the story, see State slams alleged Bloomington mortgage scammer (Consent agreement calls for consumers to get advance fees returned).

Lien Stripping Question In Chapter 13 Bankruptcy Proceedings Comes To A Head In Minnesota; Advocates Seek Case Law Consistency With Rest Of Country

The Minnesota Lawyer reports:
  • [Minnesota]’s bankruptcy attorneys are hoping that a case before the 8th Circuit Court of Appeals will allow debtors to get out from under second mortgages in Chapter 13 bankruptcies and bring Minnesota in line with the rest of the country when it comes to a practice called lien stripping.

***

  • In the 1990s into the 2000s bankruptcy courts said you couldn’t do lien stripping on unsecured second mortgages, but over the past few years every other circuit except for the 8th started to change its mind and say you can do lien stripping if there is no value on the home,” [Bloomington bankruptcy attorney Craig Andresen] said. “As real estate values have plummeted now you have lots of totally unsecured second mortgages, and Minnesota is still saying that you can’t strip those liens. I felt that if every other court was allowing it, why not Minnesota? It’s time to get lien stripping approved by an appeals court.”

***

  • Jasmine Keller, the Chapter 13 bankruptcy trustee for the District of Minnesota, agrees that second and third mortgages should be stripped because homeowners need help. She said some families have $200,000 mortgages on homes now worth $125,000. For them, lien stripping is no different than when corporations file for bankruptcy protection.

For more, see Lien stripping could be in state’s future (Case could allow practice now barred in bankruptcy).

Fla. AG Seeks State High Court Ruling On Applicability Of Deceptive Practices Law To Attorneys Creating, Using Invalid Assignments In F'closure Cases

In West Palm Beach, Florida, The Palm Beach Post reports:
  • Florida Attorney General Pam Bondi wants the Supreme Court to weigh in on her failed bids to investigate foreclosure law firms, saying unlawful practices have put homeowners "at considerable risk."


  • In what one lawmaker called Bondi's first aggressive move against so-called "foreclosure mills", she filed a request Wednesday for the 4th District Court of Appeal to send a query to Supreme Court justices about her investigatory authority.


  • State subpoenas against the Law Offices of David J. Stern and the Boca Raton based-Shapiro and Fishman, were quashed in the 4th DCA with judges ruling the state has no power to pursue firms under the Florida Deceptive and Unfair Trade Practices. The losses effectively killed the state's ability to pursue civil charges against seven Florida firms currently under investigation.


  • While this week's request is just the first step in getting a Supreme Court decision, some foreclosure defense attorneys and lawmakers lauded the move, saying high court rulings are needed to sort out the state's foreclosure morass.

***

  • At issue in Bondi's request is whether the creation of invalid assignments of mortgages by a law firm and the use of the documents in court is an unfair or deceptive trade practice subject to state investigation.


  • Assignments of mortgage are typically issued to banks as a way to show ownership. They have played a bigger role in foreclosure cases since the real estate bust as the chain of ownership records were obscured when loans were securitized.


  • Earlier this month, the Florida Supreme Court took the unusual step of deciding to take up an already settled foreclosure case involving an allegedly backdated assignment. The opinion, the majority of justices wrote, could impact the "mortgage foreclosure crisis throughout this state."

***

  • Bondi is besieged by critics who say she has been apathetic about the foreclosure investigations she mostly inherited from former Attorney General Bill McCollum. The furor came to a head over the summer when it was learned two of the leading foreclosure investigators had been forced to resign despite stellar performance evaluations.

For the story, see Florida's AG files motion requesting Supreme Court decision on foreclosure cases.

Saturday, December 31, 2011

New Texas Law Aims To Curb Property Owners' Errors, Fraud In Obtaining Real Estate Tax Exemptions On Homestead Claims

In Austin, Texas, the Austin American Statesman reports:
  • Some Texas homeowners are finding that they face new rules when applying for a homestead exemption on their property, the result of a new law that took effect in September.


  • The rules — which lawmakers say are intended to prevent fraudulent homestead exemptions — will affect people whose circumstances have changed. That includes first-time buyers, those purchasing a new home or people who have become eligible for a different type of homestead exemption, such as turning 65 or becoming disabled. It will not affect homeowners who already have a homestead exemption on their primary residence.

***

  • Homestead exemptions remove a portion of a home's value from taxation, lowering the amount of property tax a homeowner must pay. The measure's author, state Rep. Harvey Hilderbran, R-Kerrville, said the changes were needed to prevent property owners from claiming homestead exemptions on more than one property. Hilderbran said he heard complaints from appraisal districts across the state about homestead duplications — particularly from out-of-state and in-state residents filing exemptions for vacation homes.

***

  • Jim Robinson, the Harris County Appraisal District's chief appraiser and legislative chairman of the Texas Association of Appraisal Districts, said the state needed to crack down on duplication of homestead exemptions.


  • "You're talking about major theft, really, when (homestead duplication) occurs," Robinson said. "The homestead exemption is the single largest source of tax relief for people, and when you have people who are cheating on it and are saving gigantic amounts on taxes that they really should be paying, it means that the taxing units where this cheating is occurring have to set a higher tax rate, which penalizes everybody to raise the money that they need to fund their budgets."

***

  • Robinson said one problem occurring all around Texas has been property owners applying for homestead exemptions for rental properties.


  • "We had one case where a man and woman (in Harris County) had more than a dozen homesteads on their ... rental properties, and on each case, they used the address of the rental property, but they would use a different variant of their names. On some of them, they would show both of them as the owner; on some they would show either the husband or the wife as the owner," Robinson said.

For more, see Texans adjusting to changes in homestead exemption rules.

BofA Throws Foreclosure Contractor Under The Bus As Burglary Charge Brought For Alleged Unauthorized Entry, Disturbance Of Family's Belongings

In Martinsburg, West Virginia, The Journal reports:
  • A Martinsburg man contracted by Bank of America to cut grass at a home a day after its foreclosure was arraigned on one count of daytime burglary Wednesday after he allegedly entered the house and rifled through the family's personal belongings.


  • Warren Edward Brown, 30, of Herman Lane, was later released after posting $15,000 bail. One of the alleged victims told police that boxes in a family room had been disturbed, a bedroom closet was rummaged through, a safe in the basement was moved and copper wire had been moved from the garage to the driveway, according to court records.


  • Brown has denied any wrongdoing, telling police that another man working with him found that a back door had been kicked in and that it was part of his job to enter the residence to see if there were any damages or if anything was missing, records show.


  • Brown's supervisor and a Bank of America representative, however, told police that no one, including Brown, was authorized to enter the residence.

***

  • On Oct. 21, [West Virginia State Trooper N.F.] Alatta contacted the field service office for Bank of America and spoke with a representative about the situation. The representative told the officer that Bank of America had submitted an order for the grass to be cut at the residence and stated that no one should have gone into the home, including Brown, records show.

For more, see Bank contractor charged with burglary (Martinsburg man hired by Bank of America to cut grass at foreclosed home arraigned).

Deteriorating Conditions, Suspended Utility Service Leave Low-Income Tenants In Limbo With Financially Strapped Landlord, Foreclosing Lender

In Las Cruces, New Mexico, the Las Cruces Sun News reports:
  • Narine Rodriguez had brought her 2-day-old baby home for only an hour. "I am hoping there is not carbon monoxide here," said the 27-year-old single mom while standing with one foot propping open the apartment door at the Madrid Manor, 202 W. Madrid in Las Cruces.


  • She stood with a group of other tenants who gathered Wednesday afternoon outside her apartment to address what they say is an intolerable situation throughout their complex: roofs leaking and ceilings caving in, bath tubs held together with duct tape, inoperable toilets, neglected heaters they fear may be leaking poisonous carbon monoxide and - the final holiday topper - no water service until late Wednesday, when it was restored.


  • "I don't have any water, nothing running out of the sink," said Monica Salazar, a mother of five children ranging from 3 years of age to 10. She had just arrived home with her kids to find empty water pipes. "I don't know how I'm going to cook now. Obviously, I will have dishes to wash. My kids need to be bathed," said the 31-year-old, who said she always pays rent and bills promptly.


  • "I will call the landlord, but you can never reach them," she said. "All you get is the answering machine. I don't know what I'm going to do."


  • It's a problem that has tenants stuck between their low-income status and a landlord mired in a foreclosure that she says limits her responsiveness to tenant complaints about deteriorating living conditions and suspended utilities.


  • The landlord, who tenants identified as Cheryl Butler, had her published office number disconnected. Butler is listed on the Realtor.com as an agent for Abstract Real Estate and Rentals, [...] in Las Cruces.


  • When contacted on her cell phone, Butler said the Madrid Manor property had been foreclosed on and that she was not responsible for paying its bills. Butler said she was aware the water had been temporarily turned off and had done all she could to remedy it.


  • But, she said, it was the responsibility of "the bank" to pay the water bill and that she could not do anything without the bank's permission. "I can only do what the bank allows me to do," said Butler. When asked for the identity of the bank, she said she could not recall the name, adding: "I only report to the person I report to, and he deals with the bank." When asked for the name of person who reported to the bank, Butler declined to give that person's name.

For the story, see Apartment foreclosure leaves tenants in limbo.

Landlord's Foreclosure Drives Church Congregation Onto Streets; Hold Xmas Services In Parking Lot

In Phoenix, Arizona, KNXV-TV Channel 15 reports:
  • A congregation said they were just locked out of their Valley church four days before Christmas. Their Christmas tree was up and the toys were still inside. Members of the Destiny Center International Church told ABC15 that since their landlord lost the church in a foreclosure, they consequently were kicked out.

***

  • We decided we’re gonna stick it out,” he said. Service will carry-on, just in the parking lot. On Friday, Lephiew said the now banked-owned property allowed members to remove all of their belongings from the building near 35th and Northern Avenues. Everything that was once inside the church is now sitting inside a storage POD outside of it.

For the story, see Congregation evicted from church four days before Christmas.

See also, Parishioners of Foreclosed Church Attend Service in Parking Lot.

C. Florida Church On Verge Of Foreclosure Gets Boot Over Unpaid Electric Bill; Fire Marshal: Lack Of Power To Premises Makes Sanctuary Unsafe For Use

In Lakeland, Florida, The Ledger reports:
  • Polk County's largest church sanctuary sits idle, its power turned off and its future uncertain. Without Walls Central, the 9,000-seat sanctuary in North Lakeland formerly known as Carpenter's Home Church, has not held services since at least August, when Lakeland Electric disconnected electrical service because of missed payments by its owner, Tampa-based Without Walls International Church.


  • Rev. Randy White, a co-founder of Without Walls International and the ex-husband of its senior pastor, Paula White, told The Ledger in November that the Lakeland property was on the verge of either being sold or going into foreclosure and that an announcement on its future would come soon.

***

  • Lakeland Electric discontinued electrical service to the property in August, city spokesman Kevin Cook said. He said Without Walls owed more than $50,000 in unpaid bills at the time. Lakeland Electric applied the church's deposit of $51,180, he said, leaving the owners with a balance of $2,953.79.


  • Lakeland Fire Marshal Frank Bass posted notices at the property in late September reading, "This structure is unsafe for human occupancy and ordered vacated. This structure must remain vacant and unoccupied until all violations are corrected."


  • Bass said he posted the order because the lack of power to the sanctuary makes it unsafe for use.

For the story, see Future In Doubt for Without Walls Central Church Property (Without Walls Central has not held services since at least August).

Friday, December 30, 2011

Schack Blisters F'closing Bankster For Invoking "Absurd" "Pontius Pilate/Sgt. Schultz Defense" After Being Nailed For Submitting Robosigned Court Docs

In Brooklyn, New York, the New York Daily News reports:
  • A Brooklyn judge ridiculed HSBC's "know nothing" defense for filing a false document in a foreclosure case and slapped the bank with the maximum $10,000 penalty. “HSBC sounds like ... Sgt. Schultz in the classic 1960s television comedy, 'Hogan's Heroes,'" Supreme Court Justice Arthur Schack wrote in a Dec. 22 decision made public Wednesday.


  • "The inept Sgt. Hans Schultz ... would feign ignorance about the escapades of his Allied prisoners by telling his commandant, Col. Klink, 'I know nothing! Nothing!'"(1)


  • HSBC had incurred Schack's wrath earlier this year when he caught its lawyers submitting documents filed by “robo-signers" purporting to work for the bank who were were actually employed by a loan servicing firm.


  • Bank officials and their lawyers are required to review and verify the accuracy of filings in foreclosure cases under regulations issued by state Chief Judge Jonathan Lippman. Later, a bank senior vice president submitted a sworn affidavit claiming HSBC had no knowledge of the mortgage in question and blamed the fiasco on the loan servicer.


  • But Schack, whose blistering and colorful opinions from the bench have made him a folk hero for financially troubled homeowners — said HSBC is responsible for the actions of its agents. The ticked-off judge also docked the bank's Rochester-based law firm $5,000 for its conduct in the matter, according to court papers.


  • The judge had ordered HSBC President and CEO Irene Dorner to appear at a hearing last July, but she blew it off. "She was missing in action, demonstrating her personal contempt for the Supreme Court of the State of New York," Schack fumed.


  • A representative for the law firm Shapiro DiCaro & Barak said it is appealing Schack's decision. Bank spokesman Neil Brazil said HSBC neither serviced the loan nor “prepared nor filed any of the underlying legal documents presented to the court.”


  • The tumult stemmed from homeowner Ellen Taher's delinquent mortgage on her Bedford-Stuyvesant, Brooklyn, residence.

Source: HSBC like ‘know nothing’ Sgt. Schultz from ‘Hogan’s Heroes,’ Brooklyn judge says; Blames bank in foreclosure errors.

For the ruling, see HSBC Bank USA, N.A. v Taher, 2011 NY Slip Op 52317(U) (NY Sup. Ct., Kings County, December 22, 2011, Schack, J.).

(1) In hammering the foreclosing bankster, Justice Schack made these comments:

  • Further, as indicated by the Musarra affidavit and the Michael Ware Memorandum of Law, HSBC sounds like a combination of Pontius Pilate and Sergeant Schultz in the classic 1960's television comedy, Hogan's Heroes.

    HSBC washes its hands of any responsibility and places any blame upon OCWEN, its servicer for the TAHER mortgage. To paraphrase Matthew 27:24, in the New Testament, "when HSBC saw that it could prevail nothing, but that rather a tumult was made, it took water, and washed its hands before the multitude, saying, 'I am innocent of responsibility and should not be sanctioned.'"

    John Banner, the actor who played the inept Sergeant Hans Schultz, a guard in World War II's Stalag 13, would feign ignorance about the escapades of his Allied prisoners by telling his commandant, Colonel Klink, "I know nothing! Nothing!"

***

  • Moreover, HSBC's Pontius Pilate/Sergeant Schultz defense is absurd. The case caption states that HSBC is the plaintiff, not OCWEN. If HSBC has its name on the caption, it can't claim ignorance. HSBC as plaintiff is responsible for the actions of its agents, such as OCWEN.

    Mr. Ware's claim that "neither HSBC not Dorner was in any practical position to control the prosecution of this action" is ludicrous. This does not absolve HSBC of its corporate sins. If HSBC is a ship, Ms. Dorner is the Captain and responsible for both the good and the bad. However, in the instant action, HSBC appears to be the RMS Titanic. Ms. Dorner, unlike Captain Edward Smith of the RMS Titanic, did not go down with the ship after it struck an iceberg.

Widow Wins Battle To Wrestle Back Control Of Her Vacated Home From Adverse Possession-Claiming House Hijackers; Squatter Claims $7.5K Mechanics' Lien

In Mansfield, Texas, the Star Telegram reports:
  • A teary-eyed widow got her house back from squatters Thursday morning without a fight. "This has made a toll on me and my family right now," said Brenda J. Thornton, who appeared in eviction court. "This needs to be told. ... How they can come in and do this to us? It hurts."


  • The latest squatter case in Tarrant County was resolved in about five minutes in Justice of the Peace Matt Hayes court after attorney Robert Frisch said his clients, Andre and Selena Brown, were not disputing their rights to the house on Hillgrove Court under state adverse possession law.


  • State law allows persons to claim a right to abandoned property if they maintain it and pay taxes on it. Over time, if no owner claims the property, then the person may stake a claim. The Browns filed an affidavit of adverse possession months ago, claiming a right to the property on Hillgrove Court.Thornton owns the title on the property and raised her family there, she said.


  • "It's a little bit of an unusual situation there but it looks like everything was resolved amicably," Hayes said after the eviction hearing. No testimony was heard and no arguments were presented. Frisch said his clients only wanted to make arrangements with Thornton and her attorney to get their belongings out of the house.

***

  • All told, about 55 affidavits have been filed in the last six months at [County Clerk Mary Louise] Garcia's office by people claiming rights to abandoned property. On Nov. 7, Tarrant County District Attorney Joe Shannon instructed Garcia's office to stop taking the affidavits because of alleged fraud. Shannon's office also has vowed to pursue criminal action against those who file fraudulent paperwork.


  • The Browns were arrested for burglary of a habitation almost two weeks ago. Family members Alicia and Andrew LaTour, who had filed affidavits on another Mansfield home, were arrested earlier on the same charges. Formal charges may be filed in upcoming days, officials said. Frisch represented the LaTours and the Browns.


  • Andre Brown also placed a mechanic's lien on Thornton's Hillgrove Court property, asking for compensation for about $7,500 in construction and repairs he made to the house since moving in. La Rue said that claim would be discussed in the next few days, among other items, such as arranging for the Browns to retrieve their possessions from the house.

For the story, see Widow gets Mansfield house back from squatters.

See also, Mansfield squatter suspects keep it all in the family.

Financially Strapped Homeowners Becoming More & More Comfortable Fighting Back Against F'closure, Using Technicalities To Leave Banksters Sucking Wind

CNNMoney reports:
  • Delinquent borrowers facing foreclosure are learning that they can stay in their homes for years, as long as they're willing to put up a fight. Among the tactics: Challenging the bank's actions, waiting to file paperwork right up until the deadline, requesting the lender dig up original paperwork or, in some extreme cases, declaring bankruptcy.


  • Nationwide, the average time it takes to process a foreclosure -- from the first missed payment to the final foreclosure auction -- has climbed to 674 days from 253 days just four years ago, according to LPS Applied Analytics.


  • It takes much longer than that in Florida, where the process averages 1,027 days, nearly 3 years. In D.C., foreclosure averages 1,053 days and delinquent borrowers in New York often stay in their homes for an average of 906 days.

***

  • Ironically enough, the banks have given delinquent borrowers some of the ammunition they need to delay the foreclosure process. During the "robo-signing" scandal in 2010, it was revealed that bank employees signed paperwork attesting to facts they had no personal knowledge of. Now, borrowers are routinely challenging that paperwork.

For more, see Foreclosure free ride: 3 years, no payments.

Thursday, December 29, 2011

Brooklyn Judge Clips Bankster, Foreclosure Mill Sweatshop For $15K In Sanctions For Wasting Judicial Resources In Continuing Heavily Defective Suit

In Brooklyn, New York, The Buffalo News reports:
  • An outspoken State Supreme Court justice in Brooklyn known for taking on banks and throwing out foreclosures has fined HSBC Bank USA $10,000 for “frivolous conduct” in trying to seize a home without proper paperwork.


  • Justice Arthur M. Schack sanctioned the U. S. subsidiary of London-based HSBC Holdings Plc last week, citing the bank’s “waste of judicial resources” in continuing a foreclosure action “with all of its defects.”


  • In his ruling, he said the bank’s “use of robosigners” is “completely without merit in law,” and he accused the bank of asserting “material factual statements that are false.”


  • He also sanctioned HSBC’s legal counsel, the law firm of Shapiro DiCaro & Barak LLC, for the same reasons, putting blame specifically on attorney Frank M. Cassara but imposing a $5,000 fine on the firm instead of the attorney.


  • The judge did not fine HSBC USA CEO Irene M. Dorner, whom he had ordered to appear in a hearing July 15 to justify why he should not sanction her or the bank. Dorner was out of the country and did not appear at that hearing, but rather sent an attorney as her representative.


  • That had triggered indignant outrage among a few online pundits and foreclosure victims, but Schack acknowledged in his ruling that, because she had the attorney present, “It’s HSBC that I might be able to sanction, not Ms. Dorner as an individual.”

For more, see HSBC Bank USA fined $10,000 in home seizure.

For the ruling, see HSBC Bank USA, N.A. v Taher, 2011 NY Slip Op 52317(U) (NY Sup. Ct., Kings County, December 22, 2011, Schack, J.).

Sale Leaseback-Peddling Prosecution Ends Up With 6-Months House Arrest For One; Sentencing For Another Delayed Pending Evaluation Of Snitch's Help

In Concord, New Hampshire, The Nashua Telegraph reports:
  • A former Nashua man’s sentencing on federal mail fraud charges for stripping equity from troubled homeowners facing foreclosure has been postponed again. Walter Bressler, now of Frisco, Texas, will be sentenced on federal mail fraud charges March 12. Bressler has pleaded guilty to the charges and was supposed to be sentenced Dec. 5, according to documents filed at U.S. District Court in Concord.(1)


  • Meanwhile, a second man who admitted to his role in the same mortgage scheme was sentenced Dec. 6. Richard Winefield was sentenced in U.S. District Court on felony mail fraud charges and was given three years probation with special conditions, including a six-month period of home detention and electronic monitoring. He was ordered to pay $407,500 in restitution.


  • Bressler’s sentencing hearings have been postponed several times to give him and prosecutors time to evaluate his cooperation inresolving other targets,”(2) according to court documents. Bressler was supposed to be sentenced Aug. 11 and then Dec. 12, according to court records.


  • Prosecutors claim Bressler and Winefield helped persuade financially troubled homeowners to sign over the deeds to their properties with the promise they could stay on as tenants, pay rent for two years and then buy the property back at a prearranged price.


  • Instead, the scheme’s participants resold the homes to “straw buyers,” often in amounts that exceeded the original owner’s loans, according to the U.S. attorney. Some of the rent money was used to pay off the new mortgages, but the loans eventually went unpaid and the homes fell into foreclosure.


  • The original owners had no “realistic opportunities” to buy their homes back because they had been stripped of equity and encumbered with large defaulted loans, according to the U.S. attorney.


  • Michael Prieto has been identified by prosecutors as a partner of Bressler’s and Winefield’s, but he hasn’t been charged. Prieto said it was no scheme, but rather a refinancing program intended to help struggling homeowners, which would have worked if they had paid their agreed-upon rent.


  • The agreement and the program … was not a scam,” Prieto previously told The Telegraph. “It was designed for its purpose, which was helping people pay off their debts, giving them breathing room, giving them an opportunity to stay in their homes for two years.”

For the story, see Former Nashua man’s sentencing for mortgage scheme postponed.

(1) Go here for:

(2) "Resolving other targets" is an apparent euphemism used by the Feds and other insiders in place of the more common vernacular familiar to the public, 'throwing under the bus'. The existence of negotiations to assess the value of Bressler's contribution in dragging down more of the scam's confederates reinforces the observation made by one learned Federal judge with regard to plea deal negotiations and the so-called race to the prosecutor's office:

  • "When a conspiracy is exposed by an arrest or execution of search warrants, soon-to-be defendants know that the first one to "belly up" and tell what he knows receives the best deal. The pressure is to bargain and bargain early, even if an indictment has not been filed." United States v. Moody, 206 F.3d 609, 617 (6th Cir. 2000) (Wiseman, J., concurring) (referring to the not-uncommon 'race to the courthouse' that breaks out among participants in an uncovered criminal conspiracy).

Man To Stand Trial For Allegedly Forging Ex-Fiance's Signature To Strip Home Title, Allowing Scammer To Sell It, Pocket The Cash, Flee To Europe

In Elkhorn, Wisconsin, The Janesville Gazette reports:
  • Jacqueline Sharlein recognizes the forged signatures that stripped her ownership of her East Troy home, allowing someone to sell it and flee to Eastern Europe. The signatures were forged by her former fiancé, she said.


  • Gerald Nickels was ordered [] to stand trial after Walworth County Judge John Race ruled Nickels probably committed a felony.


  • Sharlein was the only witness to take the stand during the preliminary hearing, where Nickels silently watched with his attorneys. Sharlein testified she was familiar with Nickels' handwriting, and signatures on a quit claim deed and escrow check matched those of her former fiancé. Sharlein said her first name was even misspelled on one of the signatures.


  • Nickels is charged with forgery and misappropriating identity, both felonies carrying a maximum prison sentence of up to six years.

For the story, see Suspect ordered to stand trial for felony forgery charge.