Missing Lawyer Suspected Of Looting $3M From Firm's Trust Accounts Paid Off $386K Mortgage Before Deeding Over Home To Wife

In Boca Raton, Florida, the ABA Journal reports:

• Missing for nearly a month along with, authorities allege, around $3 million from his law firm and his title company accounts, a South Florida lawyer satisfied a $386,000 mortgage on his Boca Raton home in December and deeded the house, worth an estimated $445,000, to his wife shortly before he disappeared, reports the Sun-Sentinel.

Source: Lawyer deeded $445K home to wife before vanishing—at same time as $3M in law firm money, bar says.

Ex-NBA "Energizer" Gets Pinched In Arizona For Squatting In Temporarily Unoccupied Home, Then Attempting To Pocket Cash By Renting It Out On Craigslist

In Paradise Valley, Arizona, The Arizona Republic reports:

• A former NBA All-Star is facing several criminal charges after police said he squatted in a Paradise Valley home and then tried to list the place for rent on Craigslist.
  
  Chris Gatling is accused of breaking into a key box and living in the home from July 2010 to August 2011. A police report says the homeowners lived in California but had left the power on.
  
  A local TV station reports that he later listed the four-bedroom house for rent for $800 and called it an “Ex-NBA” home online.
  
  Court records say that Gatling got a down payment from one potential renter but that another got suspicious and contacted police.
  
  Gatling’s attorney, Michael Alarid, said the case is a “misunderstanding.”
  
  Nicknamed “The Energizer,” Gatling played 12 seasons in the NBA, averaging 10.3 points and 5.3 rebounds per game. Gatling, a 6-10 forward/center, made one All-Star roster, in 1996-97, and retired in 2002. According to salary information posted at basketball-reference.com, Gatling made nearly $30 million in his NBA career.

Source: Ex-NBA All-Star accused of squatting in Paradise Valley home.

California Man Close To Acquiring Marketable Title To Home Through Adverse Possession Claim After Maintaining Continuous Physical Presence On Premises & Paying Taxes For 5+ Years; Heirs Of Dead Owner Of Record Have Not Been Heard From

In Oakland, California, KTVU-TV Channel 2 reports:

• Imagine moving into a vacant home and owning it without ever paying the mortgage. That's exactly what Steven Decaprio did. He found the ultimate fixer-upper in a 109-year-old, two-story duplex in West Oakland.
  
  "When I first walked in here, it was basically full of debris, trash and dead animals," said Decaprio.
  
  The sign on his fence now says, "No Trespassing," but 13 years ago, some might say that's exactly what Decaprio did. He said the front gate was chained when he first found the property.
  
  Once inside, Decaprio spent years fixing the abandoned home. He installed new drywall, a kitchen, and new floor. But he also started doing something else.
  
  "Yeah, we paid all the property taxes on the property," said Decaprio.
  
  So far, Decaprio paid thousands of dollars in property taxes. Alameda County records show Decaprio has continued paying them for the last seven years. According to the Assessor's Office, the owner of record is the Estate of Henry Curry, a man who died in the early '80s.
  
  But Decaprio says the house was empty long before then and insists the law is now on his side.
  
  When asked if at any point did anybody contact him to say he was on their property. Decaprio said no. "If you pay the property taxes and occupy the space for five years, you have adverse possession," said Decaprio.
  
  Adverse possession is an old law, with roots in California dating back to the Gold Rush, where someone can obtain title to a property without paying for it.
  
  Palo Alto real estate attorney Julia Wei believes Decaprio is the owner of the property and appears to have met key requirements of adverse possession under California law.
  
  He has paid the property taxes for more than five years. He had a continuous physical presence on the land. And the previous owner has never contacted him about it.
  
  "He went to the assessor's office and recorded a grant deed. He's added his spouse to the title. He's doing all of the things, short of a court action, to demonstrate he is the owner of the property," Wei said.
  
  Without that court action, Decaprio won't be able to sell or borrow against this property, now valued around $300,000.
  
  And he's had trouble getting the county to recognize his ownership. While Decaprio has running water, his house is still not hooked up to the grid. All of his electricity comes from solar panels on the roof.
  
  Decaprio hasn't always been so successful. He was arrested while trying to occupy another property in Berkeley in 2004. "Once you have a hostile neighbors and a city government working against you, it doesn't matter what the laws say," said Decaprio.
  
  Once homeless, Decaprio is now preparing to take the bar exam and runs a group called Land Action, educating others on a variety of issues, including what he calls foreclosure defense.
  
  Since the housing market crashed, there are more abandoned properties that might seem ripe for the taking.
  
  "People don't realize there's a lot of sweat equity that goes into it," added Decaprio.
  

For the story, see State law allows squatter to own vacant home.

Homeowner Spends Thousand$ To Regain Control Of House Held Out For Rent After Adverse Possession-Claiming Crackpot Commandeered Control Of Temporarily-Unoccupied Premises

In Miami, Florida, WFOR-TV Channel 4 reports:

• Carlos Mejeas can’t forget the shock of finding a woman named Michele Bell and a half dozen other strangers living in his six bedroom Miami house, which was on the market for rent.
  
  “I almost had a heart attack. I came to the house she was here. Fifteen people were here,” Mejeas told CBS4 Chief Investigator Michele GIllen.
  
  But finding her living there was just the beginning of his nightmare.
  
  Bell didn’t want to just live in Mejeas’ house, she wanted to own it. According to documents filed with the Miami Dade Property Appraisers office, she had filled out a one page form and applied to adverse possess the house.

***

• For someone to legally adverse possess a property, it needs to be abandoned and the applicant needs to pay property taxes for 7 years. A CBS4 investigation finds that is rarely the case, and in fact many of the homes people are moving into and filed adverse possession for are owned by another party who is current with paying taxes on the property.
  
  In fact, just recently and for the first time, the Miami Dade Property Appraisers Office did a cross check with the Tax Collectors office and found that nearly half of all recent adverse possession applications were invalid and were immediately voided because the taxes were current.
  
  CBS4 investigators visited dozens of houses across Miami-Dade and Broward whose addresses we found on documents filed with the property appraiser’s offices.
  
  One such house happens to be located directly across the street from the home of Carlos Mejeas. Mejeas said he finally got his house back after spending thousands of dollars in legal fees to go to court to try and get Michele Bell and her acquaintances out of his house.

For more, see Adverse Possession Loophole Creating Headaches For Homeowners.

Judge Demands Proof That BofA Served Adverse Possession-Claiming Crackpot With Legal Papers Before Awarding Monetary Damages In Recent South Florida Home Hijacking Spectacle

In West Palm Beach, Florida, the South Florida Sun Sentinel reports:

• Find Loki Boy. That's the order from a Palm Beach County judge.
  
  Bank of America can't be declared the winner in its lawsuit against famed Boca Raton mansion squatter Andre Barbosa until the bank's lawyers first prove he's been served with more court papers, Circuit Judge Jeffrey Gillen has ruled.
  
  That could be challenging, considering the 23-year-old aspiring rapper and self-proclaimed Norse god of mischief has been elusive in the past and it's not clear where he now calls home.
  
  Bank of America — which in early February seized the foreclosed $2.5 million waterfront estate at 580 Golden Harbour Drive — sued Barbosa for damages and wanted the courts to "remove any impediment" to selling the property before a planned April 10 closing date.
  
  But Gillen, in an order signed April 18 and posted Tuesday, denied the bank's motion for a default final judgment against Barbosa. It was unclear if the house sale took place anyway, as a neighbor told the Sun Sentinel the place was sold.

For more, see Court denies bank in case against Boca mansion squatter (Judge wants proof 'Loki Boy' served with lawsuit).

Lawsuit: Brooklyn Landlord Rolls Out 'Welcome Mat' For Whites Only; 'Testers' Say Black Renters Need Not Apply

In Bay Ridge, Brooklyn, the New York Post reports:

• An advocacy group filed suit yesterday against the operators of a Brooklyn apartment building it says turned away black applicants in favor of prospective white ones.
  
  The federal civil-rights lawsuit filed by the Fair Housing Justice Center(1) says the nonprofit sent several undercover “testers” to the building at 7502 Ridge Blvd. in Bay Ridge and found that that whites got a more welcoming reception.(2)
  
  The building’s two superintendents “repeatedly lied to the African-American testers about the availability of apartments, telling them that no apartments would be available . . .even as they were at the same time showing an immediately available apartment to the white testers,” the suit says.
  
  The suit cites one incident in which a black woman asked about renting an apartment and was told that none apartments were vacant and and then was told by the super that the super didn’t have the broker’s phone number. The next day, a white female tester inquiring about an apartment was told a unit was available and given the broker’s number, and informed that the unit rented for $1,400 a month, the suit says.
  
  Hal Shapiro, one of the principals of building owner Merz Realty, said that he’d never condone discriminatory policies and that that he owns several buildings where all the residents are black.

Source: ‘Whites only’ at Brooklyn building.

(1) The Fair Housing Justice Center, Inc. (FHJC) is a regional fair housing organization based in New York City. The FHJC provides a full-service fair housing program to New York City and the seven surrounding New York counties of Dutchess, Nassau, Orange, Putnam, Rockland, Suffolk, and Westchester.

(2) See Fair Housing Defense blog: Standing and Fair Housing Testers for a brief introduction to the subject of outfits that employ testers and their legal standing to file Fair Housing lawsuits.

Rejected Prospective Renter Scores $20K In Feds' Housing Discrimination Suit Settlement Over Landlord's Alleged Occupancy Policy That Family's Four Kids Were "Too Many" For 3-Bedroom Apt.

From the U.S. Department of Justice (Washington, D.C.):

• The Justice Department announced [] that Marcus Manly Magee III, Ina Magee, and their company, M.M. and S. Inc., have agreed to pay $27,000 to settle a lawsuit involving violations of the Fair Housing Act. The lawsuit alleged that the defendants established and implemented an occupancy policy at ­­23 rental properties in Magee, Miss., that differentiated between the maximum number of adults and children who could reside in each home.
  
  Under the consent order, which was approved [] by the U.S. District Court for the Southern District of Mississippi, the defendants must pay $20,000 to a family that was harmed by defendants’ discriminatory practices and $7,000 to the United States as a civil penalty.
  
  In addition, the order prohibits the defendants from discriminating against families with children in the future, mandates a non-discriminatory occupancy policy of two persons per bedroom, and requires the defendants to receive training on the Fair Housing Act.

***

• The lawsuit, filed in November 2011, arose as a result of a complaint filed with the U.S. Department of Housing and Urban Development (HUD). After HUD investigated the complaint, it issued a charge of discrimination and the matter was referred to the Justice Department.
  
  The lawsuit alleged that the defendants violated the Fair Housing Act by refusing to rent a three-bedroom home to a woman with four children because she had “too many children” under the defendants’ occupancy policy. The suit also alleged that by setting a lower maximum number of children than adults who could reside in each home, the defendants engaged in a pattern or practice of discrimination or denied rights protected by the Fair Housing Act to a group of persons.

For the Justice Department press release, see Justice Department Settles Lawsuit Against Owners and Managers of Rental Homes in Mississippi for Discriminating Against Families with Children.

For the settlement agreement, see U.S. v. Magee, et al.

The Fair Housing Act & The "Mrs. Murphy Exemption"

From a post on the Fair Housing Defense blog:

• As discussed in this space in past posts, our federal Fair Housing Act (FHA) contains a handful of exceptions, the most famous of which is the "Mrs. Murphy Exemption."
  
  This provision in the law provides that a home is exempt from the FHA if the dwelling has four or fewer rental units and the owner lives in one of those units. The exemption is based upon the hypothetical elderly widow, Mrs. Murphy, who would like to rent part of her home and who may desire to specifically pick out her tenants.
  
  A frequent question we at the Fair Housing Defense blog hear is “I live in [insert name of your state here]. Does the Mrs. Murphy exemption apply?” The general answer is “Yes” -- because the Mrs. Murphy exemption applies on a federal level to every state in the country.
  
  However, the final answer is often more complicated because many states have their own fair housing laws that provide for more stringent protections than the “floor” set by the FHA.
  
  When enacting their own fair housing laws, each state has the option of providing for the base exemption included in the FHA, but also has the option of limiting or eliminating the exemption under their own fair housing act. Even though you may be in compliance with the FHA, it’s entirely possible that some action that you take might be in violation of other state or local laws, regulations or ordinances.
  
  As such, please see below a quick “50 State Survey” of the Mrs. Murphy exemption to provide general guidance as to whether your state follows the FHA exemption or has chosen to limit that exemption in some way.

For the post, including the 50-state survey of the "Mrs. Murphy" exemption, see The FHA's "Mrs. Murphy" Exemption -- A 50 State Guide.

Chi-Town Lawmakers Consider Proposal To Mandate $12K 'Cash-For-Keys' Payments To Lease-Holding Tenants That Are Forced To Move From Foreclosed Homes; Ordinance Similar To Current Rules In Los Angeles, San Francisco

In Chicago, Illinois, the Chicago Tribune reports:

• Lenders that repossess rental buildings in Chicago — or anyone who buys a rental building at a court-ordered foreclosure auction — would have to pay tenants $12,000 per unit to move or offer them rent-controlled extended leases until the building is sold, under a proposal supported by Mayor Rahm Emanuel.
  
  Dubbed the Keep Chicago Renting ordinance, the proposal is the latest iteration of efforts that began last summer to help renters when their buildings fall into foreclosure and become bank-owned.
  
  But unlike last year's plan, the current proposal goes further than mandating additional notifications to renters and extended rental periods.
  
  After a rental building goes through foreclosure and is sold at auction, tenants with a lease would have to be offered $12,000 per rental unit to move or a one-year lease at a cost of no more than 102 percent of the prior 12-month period's annual rent.
  
  Most foreclosed properties are repossessed by lenders, but any entity that buys a foreclosed rental building at a judicial sale would have to follow the ordinance. The rules would not apply to someone who buys a building in a private transaction after the auction.
  
  The ordinance would cover all rental properties in Chicago, including single-family homes, a condominium unit that functions as a rental or a multifamily building.
  
  "It's really a good ordinance because it gives the banks an opportunity to keep buildings occupied until they sell them," said Ald. Richard Mell, 33rd, the sponsor of the ordinance. "It gives the banks another opportunity to keep the neighborhood in much better shape."
  
  The proposal is expected to generate opposition from the real estate industry, which fears it will cause investors to lose their appetite for properties in a hot rental market, and from banks, which will have to choose between paying fees to vacate buildings or become landlords.
  
  There also is concern that banks will either walk away from properties in foreclosure so they don't have to legally take possession of buildings, creating so-called zombie foreclosures, or that once the buildings do become bank-owned, they will be sold at below-market values to quickly absolve banks of their responsibilities under the law.
  
  Last year, 1,970 multifamily buildings went through the foreclosure process in Chicago, and 90 percent of them became bank owned, according to the Institute of Housing Studies at DePaul University.
  
  "This compromise ordinance ensures that tenants maintain their rights if their building is foreclosed," said Kathleen Strand, a spokesman for the mayor. "Under current law, renters do not have long-term security and receive no assistance with the costs associated with relocation once their building enters foreclosure. Mayor Emanuel's support for this ordinance is one piece of this administration's efforts to mitigate the effects of the foreclosure crisis and vacant buildings on the economy and public safety."
  
  Other cities, including Los Angeles and San Francisco, have passed laws that offer as much as $18,000 and $15,000, respectively, to displaced tenants of foreclosed buildings. A group of 16 public policy and neighborhood groups originally proposed $14,000 of relocation assistance.
  
  "It's certainly our hope that they would keep the tenants in the building in order to avoid the fee," said John Bartlett, executive director of the Metropolitan Tenants Organization. "But if they are going to empty the buildings, and my guess is that still will be the choice of some, there is a uniform fee of what it's going to cost. Right now, the cash for the keys is all over the map."
  
  In Chicago, the average amount offered to tenants is about $6,000, estimated Diane Limas, board president of the Albank Park Neighborhood Council.
  
  Community groups have worked over the past few years to beef up tenant protections within the city and to make renters aware of local ordinances. Still, most groups and legal aid attorneys say they continue to deal with illegal eviction issues.
  
  Within 21 days of taking ownership of a foreclosed rental building, owners would have to notify most tenants of their rights under the ordinance. The proposed ordinance also would require entities that purchase foreclosed rental properties at court auctions to register those properties with the city and pay a $250 fee.
  
  "I wouldn't say we're punishing the banks," Limas said. "What we don't want to see is any more of what we've seen in the past."
  
  The proposal is expected to be heard May 1 by the City Council's Housing Committee.

For the story, see Foreclosure building plan would offer Chicago renters $12,000 to move (Banks, real estate industry expected to oppose ordinance).

For story follow-up, see Foreclosed renter protections measure moves forward.

Chase's Failure To Pay $620 County Impact Fee Allows Opportunistic Investors To Score Waterfront Home For $4350 At County Tax Lien Foreclosure Sale; Servicer's Screw-Up Wipes Out Mortgage, Elderly Former Owners

In Fort Myers, Florida, WTSP-TV Channel 10 reports:

• A pair of Fort Myers men who invented Bagel Bites have left a bad taste in the mouths of a Cape Coral couple being evicted from their house by the culinary duo.
  
  Stan Garczynski and Bob Mosher, who created the bite-size pizza bagels in 1985, bought the waterfront home of Nickie Haggart, 70, and Jim Haggart, 83, at a foreclosure auction in January for $4,350.
  
  Before the real estate market crashed, the 2,991-square-foot home was listed for $1.2 million. It is currently assessed at $387,906.
  
  The house was placed on the auction block after Cape Coral foreclosed on an unpaid water assessment impact fee lien that totaled $620 plus unspecified interest, penalties and attorney fees, according to court records.
  
  The assessment was levied by the Cape as part of the utilities expansion project, which was suspended in 2009 because of concerns over costs to residents and management methods but is set to restart this year.
  
  Nickie Haggart, who was notified Wednesday she and her husband must vacate by Friday morning, said the couple were hit hard by the economic downturn and stopped paying their mortgage five years ago after buying the house in 2004.
  
  It went into foreclosure, but they thought the lender would pay the taxes, assessments and property insurance until the property could be sold, she said. She admits they may have received notices about a foreclosure auction but were preoccupied with health issues.
  
  In February, two days after undergoing a mastectomy to remove a cancerous lump in her breast, she found a note on her door. She then received a call that turned her life upside down, she said.
  
  "(Garczynski) called me and he said, 'I need to get in the house to take pictures,' because he wanted to see what he had to repair before they moved in that weekend," she said.
  
  She said she told Garczynski she had no idea what he was talking about and he explained he now owned the home. She told him they couldn't leave because she was still fighting cancer and her husband was in the hospital with congestive heart failure. "They said, 'We're sorry for your misfortune, but we really don't care what your circumstances are because we own the house,'" she said.
  
  Though her lawyer has bought them extra time since then, she said the final deadline is Friday.
  
  "Can you think of anything more humiliating? The police are gonna come to our door," she said. On Wednesday, she was still looking for a place to move.
  
  Garczynski and Mosher referred comment to their lawyer, Gordon Duncan, who said his clients own the home fair and square.
  
  Duncan said it's been more than 100 days since the home was purchased and the Haggarts have yet to move out. He said Garczynski and Mosher even offered to rent the house to the Haggarts, but the couple refused. Nickie Haggart denied a rental offer was made.
  
  "Here we are now in April. They've known since October that that was going to happen," he said. "To suggest that anyone has been unfair to them I think is misplaced."
  
  He also pointed out Jim Haggart was an attorney and that the Haggarts were previously evicted from a Sanibel home in 2010 for not paying rent.
  
  "I don't think my clients want to be painted as callous but, at some point, they're entitled to possession what they bought 100 days ago," he said.
  
  Marshall Cohen, the Haggarts' attorney, said his clients knew they'd eventually have to move from the home, just not under these circumstances.
  
  And Cohen said it's Chase Bank that really got hosed on the deal. The bank owned the property once it went into foreclosure and should have received several notices about the lien and the impending auction but, for some reason, never acted, he said.
  
  He said the bank apparently overlooked the water assessment.
  
  As a result, it let a property likely valued around $500,000 slip through its fingers over a $619.58 lien, he said.
  
  Though he's not sure what happened in this case, he said paperwork is sometimes lost during the frequent switching of law firms representing banks.
  
  Nickie Haggart, meanwhile, said she still can't believe how she's been treated.
  
  "It's a really slimy way to make a living," she said.

Source: Bagel Bites inventors upset Florida couple with eviction.

See also:

• WZVN-TV Channel 7: Cape Coral home sold for $4K,
• News Press : Battle over Cape Coral home bought cheap at foreclosure auction not over (The Haggarts were evicted from the home Friday. They bought the property for $599,000 in 2004 and put more than $250,000 into it, ...).

Woman Gets 81 Months For Forging Signatures Of Unwitting In-Laws, Others To Score $228K HELOC; Suspect Also Bagged In Effort To Delay Trial By Forging Doctors' Notes Alleging Her Child Had Serious Health Problems

From the Office of the U.S. Attorney (Reno, Nevada):

• A woman who fraudulently obtained a $228,000 home equity loan in her father and mother-in-law’s names by forging their signature and the signatures of others, has been sentenced to 81 months in prison and ordered to pay $228,000 in restitution for her guilty pleas to identity theft and money laundering charges, announced Daniel G. Bogden, United States Attorney for the District of Nevada.
  
  Tandy Anne Kertanis, 33, of Reno, Nev., was sentenced on Thursday, April 11, 2013, by U.S. District Judge Larry R. Hicks. Kertanis pleaded guilty on Aug. 20, 2012, to one count of money laundering and one count of aggravated identity theft.
  
  According to the court records, on about June 19, 2007, Kertanis called Wells Fargo Bank and identified herself as Joann L. Kertanis and applied for a home equity loan in the names of Robert P. Kertanis and Joann L. Kertanis, her father and mother-in-law. Neither Robert nor Joann Kertanis was aware of the application, nor did they authorize Tandy Kertanis to apply for the loan. In late June 2007, Tandy Kertanis returned a package of loan documents to Wells Fargo. The documents contained the forged signatures of Joann L. Kertanis and/or Robert P. Kertanis, as well as forged signatures of a notary public and the defendant’s mother.
  
  The defendant submitted updated loan request documents on July 3, 2007, again containing the forged signatures of her father and mother-in-law, as well as the forged signature of the notary public, her mother, and a Reno attorney with whom she had consulted on a prior occasion. On about July 6, 2007, Wells Fargo Bank approved the home equity loan and electronically deposited $228,000 into the defendant’s U.S. Bank account in Reno.

***

• On Feb. 22, 2012, while Kertanis was awaiting trial in this case, her attorney filed a motion to continue the trial alleging that Kertanis’ young child was suffering from several serious health problems.
  
  Attached to the motion were letters from four medical specialists in Reno and California. These medical specialists were contacted and stated that the letters were false and that the young child was not suffering from any serious disease.
  
  Kertanis is free on a personal recognizance bond and must self-report to federal prison on June 10, 2013.

For the U.S. Attorney press release, see Reno Woman Sentenced To Over Six Years In Prison For Loan Fraud.

Fraudulent Purchase & Financing Of Three Homes Using Stolen IDs Among Ripoffs Subject Of Guilty Verdict For Now-Convicted Straw Buyer Scam Operator

From the Office of the U.S. Attorney (Las Vegas, Nevada):

• Following a six-day jury trial, Nicholas Lindsey, 40, of, Billings, Montana, was convicted [] of nine counts of wire fraud and one count of aggravated identity theft for his role in a mortgage fraud scheme, announced Daniel G. Bogden, United States Attorney for the District of Nevada.

***

• In addition to the [fraudulently-financed purchases of]  five homes of which the [straw] buyers were aware, Lindsey stole two buyers’ identities and used their personal information to purchase three additional properties in their names.
  
  The evidence established that Lindsey leased two of these properties and collected rental income and used the third as his own personal residence.
  
  After collecting profits, Lindsey stopped making the mortgage payments on the properties and allowed all eight homes to default in the borrowers’ names, causing an estimated loss to lenders of $1.6 million.

For more, see Former Loan Officer Convicted Of Fraud And Identity Theft Related To Mortgage Fraud Scheme.

Report: Insider Says Allegations Of Incompetence, Malevolence & Larceny Are All In A Day's Work For Trash-Out Contractor That Screws Over Distressed Homeowners

The Huffington Post reports:

• Outside in the world, Safeguard Properties was supposed to be protecting millions of homes that had slid into foreclosure, shoring up and repairing abandoned properties for the banks that were responsible for tending to all this real estate gone bad.
  
  But inside the offices of Safeguard’s complaint department, Kevin Kubovcik says he gained a starkly different perspective on his company's pursuits as allegations of incompetence, malevolence and larceny rolled in day after day.
  
  People with legal title to their property called to complain that Safeguard contractors had broken into their homes and carted off family heirlooms, valuable artwork and weapons, he recalled. People living next door to foreclosed properties complained that Safeguard mixed up the addresses and locked them out of their own homes.
  
  Complaints came in seemingly without end. "I'd pick up the phone, put it down, and then it would ring again," Kubovcik said.
  
  A recent Huffington Post investigation focused on Safeguard as the largest player in a little-scrutinized industry spawned by the American housing bust: the contractors tasked with the gritty work of maintaining a veritable empire of distressed real estate.
  
  Safeguard has been the target of dozens of lawsuits alleging that its contractors have wrongly broken into properties and carted off people’s property.(1)
  
  In response to previous questions from HuffPost about break-ins at occupied properties, Safeguard dismissed such incidents as "extremely rare" compared to the sheer volume of jobs the company manages. But Kubovcik, who logged and investigated complaints for more than two years until he left the company in April 2010, said his experience attests to precisely the opposite.
  
  "It was a constant barrage," he said.
  
  Kubovcik provided HuffPost with Excel spreadsheets that he said he had personally maintained during the time that he tracked complaints. Though the records are incomplete -- a four-month stretch from September through December of 2009 is missing -- they provide a detailed window into the frequency and types of complaints flowing into the company at the peak of the foreclosure crisis.

For more, see Safeguard Properties Internal Documents Reveal Rampant Complaints Of Thefts, Break-Ins.

(1) For those homeowners who've been screwed over by wrongful lockouts by foreclosing lenders (and their confederates) and seek some possible guidance on how much their cases might be worth if they seek to sue, see:

• Nevada High Court OKs $1M+ Damage Award To Homeowner Due To Mortgage Company Misidentification Of Home In Foreclosure (for the court ruling, see Countrywide Home Loans v. Thitchener, 192 P.3d 243; 2008 Nev. LEXIS 79; 124 Nev. Adv. Rep. 64 (Nev. 2008)),
  .........................
• Long Island Judge Hammers Wells w/ $155K Tab For Oppressive, Heavy Handed, Egregious Conduct For Pre-Sale Lockout Of Homeowner In Foreclosure (for the court ruling, see Wells Fargo v. Tyson, 27 Misc.3d 684, 897 N.Y.S.2d 610 (Sup. Ct., Suffolk County, 2010); reversed on procedural grounds Wells Fargo v. Tyson, 82 A.D.3d 757, 917 N.Y.S.2d 914 (App. Div. 2d Dept. 2011).

For examples of filed lawsuits involving illegal bank break-in, "trash-out" lockout cases, see:

• Bank admits mistake on Willcox home foreclosure (involving an Arizona homeowner) (for a copy of the resulting federal lawsuit, see Newman v. Bank of America, N.A. and go here for the attached Exhibits),
• Couple: Bank Foreclosed On Wrong House (New Bedford Couple Suing Bank Of America) (involving a Massachusetts resident with a home in Florida) (for a copy of the resulting federal lawsuit, see Cardoso v. Bank of America, et al.),
• Family's recently purchased home, gutted by property removal service (involving a Michigan homeowner) (for a copy of the resulting federal lawsuit and accompanying Exhibits , see Rought v Deutsche National Trust Company, Trustee, et al.),
• In a Sign of Foreclosure Flaws, Suits Claim Break-Ins by Banks (involving a California homeowner) (for a copy of the resulting federal lawsuit, see Ash v. Bank of America),
• Former Lake Villa couple sues Bank of America over ‘illegal’ lockout (involving a Chicago, Illinois-area homeowner) (for a copy of the resulting federal lawsuit, see McKee v. Bank of America).

Ordinance-Required, Bankster-Paid Security Deposits For Property Upkeep Due When Initiating Foreclosure Process Create Another Opportunity To Screw Over Homeowners Seeking Loan Modifications

In Worcester, Massachusetts, the Worcester Telegram reports:

• A city ordinance intended to force far-flung banks to see to the upkeep of foreclosed properties here has had the unintended consequence of adding to the financial burden of some struggling mortgage borrowers, much to the dismay of City Hall.
  
  The Vacant and Foreclosing Property Ordinance requires a bank or other company that files a foreclosure petition on any property in Worcester to notify the city and deposit $5,000 for each foreclosure petition in a special account controlled by the city treasurer.
  
  If the bank doesn’t maintain the property to the satisfaction of the Department of Inspectional Services, the city spends the money to see to the upkeep of the property itself. If the bank properly maintains the property, it gets the money back, less an administrative fee, when it sells or otherwise transfers responsibility for the house to another party.
  
  The ordinance has been effective in fighting urban blight caused by national and international financial institutions unwilling or unable to secure and maintain their portfolios of foreclosed properties in the city.
  
  But there’s just one problem.
  
  Banks and other financial institutions increasingly are lumping the $5,000 cost of the property registration bond into what the borrower owes, making it less likely that struggling homeowners can catch up on their payments and end the foreclosure process before losing their homes.
  
  That’s the predicament in which Marjorie Evans finds herself after years of frustrating calls and numerous letters to Bank of America Corp. of Charlotte, N.C., one of the largest holders of foreclosed properties in Worcester.
  
  “If the city is going to do this, they have to understand the banks don’t pay anything. We pay that,” Ms. Evans said. “It’s coming back on folks. The bank is just passing it on to us.”
  
  What’s more, she said, it appears to her from her statements that Bank of America, which has since transferred her mortgage to a Texas company, was applying the entirety of her monthly payments to such fees, not to her loan balance. Ms. Evans was not aware that $5,000 of the fees that appeared on her account without explanation were related to the city’s property registration ordinance until she was contacted by the Telegram & Gazette for this story.
  
  “I kept saying to the bank, ‘Explain these fees,’ but they never would,” she said, sitting at her dining room table with a pad of notes she has compiled from years of dealings with bank officials and federal financial regulators.

***

• Bank of America spokesman Richard Simon said the company was within its rights to then tack on $5,000 in fees to the account of Ms. Evans.(1)
  
  The standard mortgage contract required by state law places the responsibility for maintenance of a property prior to foreclosure on the borrower, Mr. Simon said.
  
  “The mortgage agreement also clearly allows a servicer to charge the borrower for out-of-pocket costs incurred by the servicer related to the borrower’s default or vacancy,” Mr. Simon said. “The bond required in the Worcester ordinance is such a charge, the same as legal fees, filing fees, direct property inspection and preservation costs, appraisal fees and other costs advanced by the servicer.”
  
  But City Manager Michael V. O’Brien is blunt in his outrage over the cost shifting, which he says penalizes borrowers for the bad behavior of big banks, some of whom have allowed foreclosed properties to deteriorate and undermine neighborhoods.

***

• Worcester Anti-Foreclosure Team organizer Jon Marien also criticized the bond cost-shifting, noting that banks are recouping from customers money that they will eventually get back from the city.
  
  “It’s just another dirty trick that we see. It’s ridiculous,” Mr. Marien said.
  
  The city now holds 861 property registration bonds totaling $4.3 million from more than a dozen banks, credit unions and other financial or real estate firms, according to the treasurer’s office. Bank of America’s bonds, at $1.8 million, account for more than a third of the total.
  
  Paul Vigneau, assistant commissioner of inspectional services, said the city has no way of knowing which banks and other financial institutions are passing on the cost of the bond to customers, except when borrowers complain.
  
  “People have called us and said, ‘Your bond cost me $5,000,’” Mr. Vigneau said.
  
  Anecdotally, the practice seems to be becoming more common and not limited to Bank of America, he said.
  
  The $5,000 bond Bank of America posted when it initiated foreclosure proceedings against Ms. Evans was recently returned to the bank, according to city records. That’s because Bank of America sold the servicing rights on a large portfolio of Freddie Mac loans, including that of Ms. Evans, to Nationstar Mortgage Holdings Inc. of Lewisville, Texas, according to Nationstar Mortgage.
  
  The city now holds a $5,000 bond on the property posted by Nationstar Mortgage’s subcontractor, Safeguard Properties of Cleveland, Ohio, according to city records.
  
  But it’s not clear if the $5,000 that Bank of America charged Ms. Evans was ever removed from her account when Bank of America got its money back from the city.
  
  “There have been situations where we’ve released the bond back to the bank and then had to work with homeowners to help them get their $5,000 back,” Mr. Vigneau said.
  
  Ms. Evans said it doesn’t appear to her from her statements that the fee was ever removed from her account before Nationstar Mortgage took over the account from Bank of America, forcing her to start over in contesting the foreclosure proceeding with yet another company. She continues to live in the duplex and dispute the basis of the foreclosure proceeding against her.
  
  “You can’t get them to take these fees off. That’s what the city has to realize,” Ms. Evans said. “Even if the city says the bank doesn’t owe the money any more, it’s still on your loan.”

For the story, see Worcester fees for foreclosed properties backfire on borrowers.

Bay Area Man Loses Home To Foreclosure Despite Remitting $27K To Reinstate Mortgage; Misplaced Cashier's Check, Failure To Apply Payment = More Of The Same At BofA

In San Francisco, California, the Center For Investigative Reporting and NBC Bay Area report:

• Joji Thomas was desperate to save his home. The San Francisco mechanical engineer sold his car, tapped into his wife’s savings and begged friends for money. In July, to stave off foreclosure, he bought a $27,777.85 cashier’s check and mailed it to Bank of America.
  
  Joji Thomas (right) directs movers as he packs up his home in San Ramon. Bank of America foreclosed on the house after the bank lost a $27,777.85 cashier’s check Thomas had sent in an effort to save the home.
  
  A bank representative acknowledged receiving the check two days later, Thomas said. But the payment went missing later that week and was not applied to his mortgage. Bank of America foreclosed on his home and sold it at auction. He moved out April 13.
  
  “I was forced into this,” he said as he cleared the furniture from his home. “I had no other choice.”
  
  Thomas is one of thousands of Bay Area homeowners fighting in court to save their homes from a foreclosure system rife with mistakes, mismanagement and even fraud, a joint investigation by the Center for Investigative Reporting and NBC Bay Area has found.
  
  Despite recent settlements with state and federal regulators and a new California law that tightens rules for the mortgage industry, banks and their subsidiaries continue to file invalid documents and foreclose on properties to which they appear to have no legal right, an analysis of thousands of pages of property records and wrongful foreclosure lawsuits shows.
  
  At the center of much of this is Bank of America, which plays the largest role of any bank in Bay Area foreclosures. From July 2008 through October, Bank of America's foreclosure trustee, ReconTrust, handled 1 in 5 defaulted properties in the Bay Area, roughly 70 percent more than the next biggest trustee, according to RealtyTrac Inc., a real estate information company. During the past five years, 184,000 Bay Area properties went into default; last year, the value of these loans exceeded $11.6 billion.
  
  Jay Patterson, a forensic accountant and certified fraud examiner in Arkansas; Ben Weber, who formerly worked for the city of San Francisco analyzing property records; and Marie McDonnell, a private auditor in Massachusetts, reviewed hundreds of loan documents and property records for this story at the request of CIR and NBC Bay Area.
  
  All three agreed there is evidence that Bank of America and its subsidiaries skirted proper procedures in foreclosure filings. These practices included lying on fraudulent loan transfers and altering dates on property records, which allowed Bank of America to initiate foreclosure and collect payments and fees for home loans it did not own.
  
  Patterson said an average homeowner looking through property records cannot tell if they are fraudulent; a public document that appears to transfer ownership of a mortgage can be fabricated. Patterson traced the true chain of ownership for mortgages on behalf of CIR and found that in many cases, banks were filing false documents.
  
  “Banks didn’t have them and were making them up to foreclose,” said Patterson, who serves as an expert witness for plaintiffs' attorneys in wrongful foreclosure lawsuits.
  
  “Land records are supposed to be the true representation of who owns the land," he said. "But what you’ve seen in the last 10 years is the bastardization of these records, and it might take another 100 years to straighten them out.”

For more, see Error claims cast doubt on Bank of America foreclosures in Bay Area.

Thanks to Deontos for the heads-up on this story.

Poorly-Baked Cakes, Collapsing Buildings, ... & Unperfected Mortgages Challenged By Bankruptcy Trustees

From the blog Bankruptcy-RealEstate-Insights.com:

• “Whether one is baking a cake, building a house, or recording a mortgage, sometimes even the slightest deviation from the directions can lead to catastrophe. Cakes don’t rise, buildings fall down, and … mortgages aren’t perfected.”(1)  So starts the opinion in Couillard.
  
  The Coulillards refinanced a purchase money mortgage. The legal description attached to the refinancing mortgage included an easement parcel, but omitted the two principal parcels. A couple of months after the mortgage was recorded, an “affidavit of correction” to correct an “error” in the mortgage legal description was recorded that attached the missing parcel descriptions. A few years later the Couillards filed bankruptcy.
  
  The bankruptcy trustee brought an adversary proceeding to avoid the mortgage using the “strong arm” powers under Section 544(a) of the Bankruptcy Code. Specifically, this section allows a trustee to assert the rights of a hypothetical bona fide purchaser of real estate that has perfected the property transfer (i.e. recorded a conveyance document) as of the commencement of the bankruptcy case.
  
  Under applicable state law, a conveyance that is not recorded is generally void as against a subsequent purchaser who records first.
  
  Outside of bankruptcy, there is generally an exception if the purchaser has either actual or constructive notice of unrecorded claims.
  
  However, in exercising a purchaser’s rights in bankruptcy, a trustee is subject to only constructive notice, not actual notice. Under applicable state law regarding constructive notice, purchasers are deemed to have notice of claims that are revealed by use or occupancy of the property or by a review of the “chain of title (i.e., the records in the office of the register of deeds and other public records)” for the property.
  
  So, this case turned on whether the Section 544(a) hypothetical purchaser would have had constructive notice of the refinancing mortgage based on a combination of the defective mortgage and the corrective affidavit.

For more, see Mortgage Errors - How Not to Correct a “Boo-Boo."

For the court ruling, see Seelen v. Couillard (In re Couillard), 486 B.R. 466 (Bankr. W.D. Wis. 2012).

(1) The court continued by noting that, outside the bankruptcy context, the bankster's error may not have been a big deal, but within a bankruptcy proceeding, it's a completely different story:

• In this case, a lender made a mistake in recording its mortgage and then attempted to fix the problem. But for the debtors’ bankruptcy, the error might have been considered inconsequential.
  
  However, the bankruptcy trustee believes that the mistake invalidates the lender’s mortgage as against a subsequent purchaser under state law and brought this adversary proceeding to avoid the mortgage pursuant to 11 U.S.C. § 544(a).

--------------------------------------------------

By the way, the court's use of hyperbole associating a mortgage screw-up with the catastrophe of a fallen building or an uncooperative cake is addressed in footnote 1 of the opinion:

• Yes, in the grand scheme of things, not quite as dramatic as a collapsing building, but nonetheless upsetting for the creditor who suffers such a fate. The trauma associated with poorly baked cakes, meanwhile, is proportionally related to the importance of the event involved.

Pension Loans: The New 'Payday-Type' Loan Duping Seniors Into Debt With Hidden Usurious Interest; Deal Disguised As A 'Signing Away Of Retirement Benefits;' Loan Sharks' Response: 'We Don't Make Loans ... We Make Advances!'

The New York Times reports:

• To retirees, the offers can sound like the answer to every money worry: convert tomorrow’s pension checks into today’s hard cash.
  
  But these offers, known as pension advances, are having devastating financial consequences for a growing number of older Americans, threatening their retirement savings and plunging them further into debt. The advances, federal and state authorities say, are not advances at all, but carefully disguised loans that require borrowers to sign over all or part of their monthly pension checks. They carry interest rates that are often many times higher than those on credit cards.
  
  In lean economic times, people with public pensions — military veterans, teachers, firefighters, police officers and others — are being courted particularly aggressively by pension-advance companies, which operate largely outside of state and federal banking regulations, but are now drawing scrutiny from Congress and the Consumer Financial Protection Bureau.

***

• A review by The New York Times of more than two dozen contracts for pension-based loans found that after factoring in various fees, the effective interest rates ranged from 27 percent to 106 percent — information not disclosed in the ads or in the contracts themselves. Furthermore, to qualify for one of the loans, borrowers are sometimes required to take out a life insurance policy that names the lender as the sole beneficiary.
  
  LumpSum Pension Advance and Pension Funding did not return calls and e-mails for comment.
  
  While it is difficult to say precisely how many financially struggling people have taken out pension loans, legal aid offices in Arizona, California, Florida and New York say they have recently encountered a surge in complaints from retirees who have run into trouble with the loans.
  
  Ronald E. Govan, a Marine Corps veteran in Snellville, Ga., paid an interest rate of more than 36 percent on a pension-based loan. He said he was enraged that veterans were being targeted by the firm, Pensions, Annuities & Settlements, which did not return calls for comment.
  
  “I served for this country,” said Mr. Govan, a Vietnam veteran, “and this is what I get in return.”
  
  The allure of borrowing against pensions underscores an abrupt reversal in the financial fortunes of many retirees in recent years, as well as the efforts by a number of financial firms, including payday lenders and debt collectors, to market directly to them.

***

• “The cost of these pension transactions can be astronomically high,” said Stuart Rossman, a lawyer with the National Consumer Law Center, an advocacy group that works on issues of economic justice for low-income people. “But there is profit to be made on older Americans’ financial pain.”
  
  The oldest members of the baby boom generation became eligible for Social Security during the recent housing bust and recession, and many nearing retirement age watched their investments plummet in value. Some are now sliding deep into debt to make ends meet.
  
  The pitches for pension loans emphasize how difficult it can be for retirees with scant savings and checkered credit histories to borrow money, especially because banks typically do not count pension income when considering loan applications.

***

• Financial products like pension advances, which promise quick cash, appear especially enticing because their long-term costs are largely hidden from the borrowers.
  
  Federal and state regulators are spotting fresh examples of abuse, and both the Consumer Financial Protection Bureau and the Senate’s Committee on Health, Education, Labor and Pensions are examining these loans, according to people with knowledge of the matter.
  
  Though the firms are not directly regulated by states, officials from the California Department of Corporations, the state’s top financial services regulator, filed a desist-and-refrain order against a pension-advance firm in 2011 for failing to disclose critical information to investors.
  
  That firm has since filed for bankruptcy, but a department spokesman said it remained watchful of pension-advance products.

***

• Borrowing against pensions can help some retirees, elder-care lawyers say. But, like payday loans, which are commonly aimed at lower-income borrowers, pension loans can turn ruinous for people who are already financially vulnerable, because of the loans’ high costs.

***

• Lawyers for service members argue that pension lending flouts federal laws that restrict how military pensions can be used. [...] Pitches to military members must sidestep a federal law that prevents veterans from automatically turning over pension payments to third parties.
  
  Pension-advance firms encourage veterans to establish separate bank accounts controlled by the firms where pension payments are deposited first and then sent to the lenders. Lawyers for retirees have challenged the pension-advance firms in courts across the United States, claiming that they illegally seize military members’ pensions and violate state limits on interest rates.
  
  To circumvent state usury laws that cap loan rates, some pension advance firms insist their products are advances, not loans, according to the firms’ Web sites and federal and state lawsuits. On its Web site, Pension Funding asks, “Is this a loan against my pension?” The answer, it says, is no. “It is an advance, not a loan,” the site says.

For more, see Loans Borrowed Against Pensions Squeeze Retirees.

Rhode Island AG Tags Attorney-Led Foreclosure Rescue Outfit In Suit Alleging Fraudulent Loan Modification Ripoffs

In Providence, Rhode Island, Courthouse News Service reports:

• A Long Island attorney runs a "Legal Network" under many names that hurts people through a nationwide "fraudulent loan modification scheme," Rhode Island claims in court.
  
  Rhode Island sued these defendants in Superior Court: R.M.A. Legal Network aka R.A. Legal Group aka Alarcon Law Group aka Professional Legal Network, Bruce A. Thomas, Robert Michael Alarcon and Rory Alarcon.
  
  Rory Alarcon, a New York attorney, runs the "network" of companies, most recently out of Holbrook, Long Island, according to the complaint. The other defendants are his agents or employees.
  
  The complaint states: "The Rhode Island Attorney General's Consumer Protection Unit has received at least twenty-one (21) complaints from consumers and/ or names of customers provided by defendant Rory Alarcon through the Civil Investigative demand process who have been defrauded out of thousands of dollars by defendants, whose risk of foreclosure has increased, and/or have been notified that the foreclosure process has begun, all as a result of fraudulent loan modification schemes executed by defendants.

For more, see State Claims Attorney Is Running a Scam.

Even More On The Feds' Bungling Of The Nationwide Foreclosure Fraud Settlement

Rolling Stone Contributing Editor Matt Taibbi writes:

• The obscene greed-and-arrogance stories emanating from Wall Street are piling up so fast, it's getting hard to keep up. This one is from last week, but I missed it – it's about the foreclosure/robo-signing settlement that was concluded earlier this year.
  
  The upshot of this story is that in advance of that notorious settlement, the government ordered banks to hire "independent" consultants to examine their loan files to see just exactly how corrupt they were.
  
  Now it comes out that not only were these consultants not so independent, not only did they very likely skew the numbers seriously in favor of the banks, and not only were these few consultants paid over $2 billion (over 20 percent of the entire settlement amount) while the average homeowner only received $300 in the deal – in addition to all of that, it appears that federal regulators will not turn over the evidence of impropriety they discovered during these reviews to homeowners who may want to sue the banks.
  
  In other words, the government not only ordered the banks to hire consultants who may have gamed the foreclosure settlement in favor of the banks, but the regulators themselves are hiding the information from the public in order to shield the banks from further lawsuits.
  
  Secrets and Lies of the Bailout ...

For more, see While Wronged Homeowners Got $300 Apiece in Foreclosure Settlement, Consultants Who Helped Protect Banks Got $2 Billion.

Antitrust Feds Ring Up 30th Conviction In Ongoing Northern California Foreclosure Sale Bid Rigging Probe

From the United States Department of Justice (Washington, D.C.):

• A Northern California real estate investor has agreed to plead guilty for his role in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions in Northern California, the Department of Justice announced.
  
  Felony charges were filed [] in the U.S. District Court for the Northern District of California in San Francisco against Mohammed Rezaian, of Novato, Calif. Rezaian is the 30th individual to plead guilty or agree to plead guilty as a result of the department’s ongoing antitrust investigations into bid rigging and fraud at public real estate foreclosure auctions in Northern California.
  
  According to court documents, Rezaian conspired with others not to bid against one another, but instead to designate a winning bidder to obtain selected properties at public real estate foreclosure auctions in San Francisco and San Mateo counties, Calif .
  
  Rezaian was also charged with conspiring to use the mail to carry out schemes to fraudulently acquire title to selected properties sold at public auctions, to make and receive payoffs, and to divert to co-conspirators money that would have otherwise gone to mortgage holders and others. According to court documents, a forfeiture allegation was also included in the charges against Rezaian.

***

• The charges today are the latest filed by the department in its ongoing investigation into bid rigging and fraud at public real estate foreclosure auctions in San Francisco, San Mateo, Contra Costa and Alameda counties, Calif.
  
  These investigations are being conducted by the Antitrust Division’s San Francisco office and the FBI’s San Francisco office. Anyone with information concerning bid rigging or fraud related to public real estate foreclosure auctions should contact the Antitrust Division’s San Francisco office at 415-436-6660 , visit www.justice.gov/atr/contact/newcase.htm, or call the FBI tip line at 415-553-7400.

For more, see Northern California Real Estate Investor Agrees to Plead Guilty to Bid Rigging at Public Foreclosure Auctions (Investigation Has Yielded 30 Plea Agreements to Date).

Investor Cops Guilty Plea For Role In Bid Rigging Conspiracy At New Jersey Tax Lien Auctions

From the U.S. Department of Justice (Washington, D.C.):

• A financial investor who purchased municipal tax liens pleaded guilty [] for his role in a conspiracy to rig bids for the sale of tax liens auctioned by municipalities in New Jersey, the Department of Justice announced.
  
  A felony charge was filed [] in U.S. District Court for the District of New Jersey in Newark, against Norman T. Remick, of Barnegat, N.J. According to the charge, from in or about the beginning of 2007 until approximately February 2009, Remick participated in a conspiracy to rig bids at auctions for the sale of municipal tax liens in New Jersey by agreeing to allocate among certain bidders which liens each would bid on. The department said that Remick proceeded to submit bids in accordance with the agreements and purchased tax liens at collusive and non-competitive interest rates.
  
  “The conspirators illegally met and engaged in anticompetitive discussions to allocate bids amongst themselves at tax lien auctions in New Jersey, depriving distressed homeowners of competitive interest rates at a time when they most needed them,” said Scott D. Hammond, Deputy Assistant Attorney General for the Antitrust Division’s criminal enforcement program. “Prosecuting these types of bid-rigging schemes remains a top priority for the division.”
  
  The department said that the primary purpose of the conspiracy was to suppress and restrain competition in order to obtain selected municipal tax liens offered at public auctions at non-competitive interest rates. When the owner of real property fails to pay taxes on that property, the municipality in which the property is located may attach a lien for the amount of the unpaid taxes. If the taxes remain unpaid after a waiting period, the lien may be sold at auction. State law requires that investors bid on the interest rate delinquent property owners will pay upon redemption. By law, the bid opens at 18 percent interest and, through a competitive bidding process, can be driven down to zero percent. If a lien remains unpaid after a certain period of time, the investor who purchased the lien may begin foreclosure proceedings against the property to which the lien is attached.
  
  According to the court documents, Remick was involved in a conspiracy with others not to bid against one another at municipal tax lien auctions in New Jersey. Since the conspiracy permitted the conspirators to purchase tax liens with limited competition, each conspirator was able to obtain liens that earned a higher interest rate. Property owners were, therefore, made to pay higher interest on their tax debts than they would have paid had their liens been purchased through open and honest competition, the department said.
  
  A violation of the Sherman Act carries a maximum penalty of 10 years in prison and a $1 million fine for individuals. The maximum fine for a Sherman Act violation may be increased to twice the gain derived from the crime or twice the loss suffered by the victims if either amount is greater than the $1 million statutory maximum.
  
  Today’s plea is the 12th guilty plea resulting from an ongoing investigation into bid rigging or fraud related to municipal tax lien auctions. Eight individuals – Isadore H. May, Richard J. Pisciotta Jr., William A. Collins, Robert W. Stein, David M. Farber, Robert E. Rothman, Stephen E. Hruby and David Butler – and three companies – DSBD LLC, Crusader Servicing Corp. and Mercer S.M.E. Inc. – have previously pleaded guilty as part of this investigation.

For the Justice Department press release, see New Jersey Investor Pleads Guilty for Role in Bid-Rigging Scheme at Municipal Tax Lien Auctions (Investigation Has Yielded 12 Guilty Pleas).

Federal Regulators Continue Applying Heat On Big Banksters For Targeting Cash-Strapped Consumers With Payday-Style Loans

The New York Times reports:

• Federal regulators on Thursday admonished some of the nation’s largest banks for offering payday-style loans, short-term costly credit tied to customers’ checking accounts.
  
  The guidance from the Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation urged the banks, including Wells Fargo and U.S. Bank, to ensure that borrowers can repay the loans, which otherwise can mire customers in debt and result in a slew of fees.
  
  Banks offer the loans linked to checking accounts with the understanding that the lender automatically withdraws the full cost of the loan when it is due. Factoring in fees, the loans, called deposit advances, can come with interest rates that exceed 300 percent.
  
  The moves on Thursday come as state and federal officials ratchet up their efforts to clamp down on payday lending at storefronts and at large banks. Across the nation, 15 states impose strict interest caps on the loans, effectively banishing payday lenders.
  
  On Wednesday, the Consumer Financial Protection Bureau, which has been examining the loans, issued a report that found the payday and direct-deposit loans can quickly morph from short-term credit into a seemingly unending burden for low-income customers. “For too many consumers, payday and deposit advance loans are debt traps,” Richard Cordray, the agency’s director, said in a statement when the report was issued.

For more, see Banks Urged to Put Limits on Payday-Style Loans.

Philadelphia Woman Who Had Home Stolen Out From Under With Forged Deed Finally Regains Title; "I Had To Go Through Hell For 5 1/2 Years To Get My House Back!"

In Philadelphia, Pennsylvania, the Philadelphia Daily News reports:

• IT WAS THE HARDEST, longest fight of Teresa Isabella's life.
  
  After five years of navigating the civil-court system mainly on her own, Isabella, 66, regained ownership last year of the massive four-story rowhouse just blocks from Rittenhouse Square that was stolen from her.
  
  "It took so many years out of my life, and at what cost, when it could have been done simpler," Isabella said in a recent interview, surrounded by years' worth of court filings, tears streaming down her cheeks. "My full-time job was this."
  
  In 2007, Isabella discovered that a bogus deed had been recorded showing that she had sold the decaying house on 18th Street near Delancey to Maureen McClay for $50,000. The city valued the house at $250,000.
  
  That kicked off a series of fake deeds and sale agreements in which the house changed hands three times from McClay to Hien Nguyen and Anna Nguyen for $90,000, and then to Jack Trung Nguyen for $150,000, all in the space of a year. "By the time I got the paperwork, a new owner had popped up," said Isabella.
  
  She said she called the police, the District Attorney's Office, the state attorney general, the FBI and several legal groups for help. "I wanted help from the city, and no one helped me," she said.
  
  Tasha Jamerson, spokeswoman for the D.A.'s Office, said Isabella had contacted the office and was referred to Central Detectives in the Police Department. The case made its way to the Major Crimes Unit, which handles fraudulent deeds, but it has not been successful, said Sgt. Joseph Cella.
  
  Cella says he urges victims to file an "action to quiet title," a civil complaint that is the only way the rightful owners can get their properties back under their names.
  
  Isabella studied the court system and how to file various legal documents. Five years and thousands of dollars later, Common Pleas Judge Esther Sylvester ruled in Isabella's favor last year, after Jack Trung Nguyen challenged an earlier ruling.Nguyen is now trying to get back money for expenditures.
  
  Isabella has taken all that she has learned from that terrible experience to help fraudulent-deed victims and friends facing foreclosure.
  
  "I had to go through hell for 5 1/2 years to get my house back," she said. "Those are the steps I had to take to get to where I am today. [But] how many people don't know what to do?"

Source: Five years later, woman gets her stolen house back.

Postal Inspectors: Con Artist Duped 88-Year Old Woman Into Giving Him POA, Then Used It To Score Reverse Mortgage On Victim's Free & Clear Home; Suspect Pocketed $51K, Leaves Premises In Foreclosure

In St. Louis, Missouri, WOAI-TV Channel 4 reports:

• Senior citizens are often prime targets for con artists. In one case, an 88-year-old woman is on the verge of losing her home.
  
  "My uncle and aunt purchased this house in 1948," explained Jackie Keller-Smith, who is the woman's niece. "It was paid off in the 70's." Jackie is trying to help her aunt save her home from foreclosure after a con artist stole it right out from under her. "He said 'If you let me stay, I will give you $50 a week,' I think he said," victim Agnes Dismuke recalled. "He didn't give me nothing."
  
  "He" is a man named Larry Bradshaw who investigators say convinced Agnes to give him her power of attorney - according to postal inspectors.
  
  "He used the Power of Attorney to obtain credit cards, loans, and for his own personal gain," said U.S. Postal Inspector Don Washington.
  
  In fact, postal inspectors say Bradshaw refinanced Agnes's home with a reverse mortgage, made off with $51,000, and Agnes never saw a dime.
  
  "He didn't see any husband here, and he just took advantage of me," said Agnes.
  
  She was unaware any of this was happening, and she is now in jeopardy of losing her home, which is in foreclosure.
  
  "This is despicable. She has been here all of her life," Agnes' niece Jackie said.
  
  City officials have halted plans to evict Agnes. But the possibility of her being forced out of her home is still a reality as courts, banks, and law enforcement try to reconcile all of the issues.
  
  Larry Bradshaw was arrested last month on wire fraud charges but has been released pending trial.

Source: Officials: Con artist steals woman's home.

For the U.S. Attorney press release, see Local Man Indicted On Fraud Charges.