Tacoma Feds Score Multi-Year Prison Sentences For Sovereign Citizen Pair Convicted Of Filing False Liens In Retaliation Against Government Officials

From the Office of the U.S. Attorney (Tacoma, Washington):

• Two men, who previously resided in Pierce County, Washington were sentenced [] in U.S. District Court in Tacoma for their illegal actions associated with a militant anti-government group, announced U.S. Attorney Jenny A. Durkan.
  
  KENNETH WAYNE LEAMING, 57, of Spanaway, Washington, was sentenced to eight years in prison for three counts of filing false liens against federal officials, and one count of harboring federal fugitives and being a felon in possession of firearms.
  
  His co-conspirator, former Tacoma resident DAVID CARROLL STEPHENSON, 57, was sentenced to 10 years in prison for a single count of filing false liens against a federal official. STEPHENSON is already serving an eight year prison sentence for tax fraud. Both men were convicted at trial in March 2013. At sentencing U.S. District Judge Ronald B. Leighton said Leaming had earned “every day” of the prison term. Leaming “flaunts authority, he harasses law abiding people who have an obligation to the people to serve.”
  
  Judge Leighton imposed a ten year sentence, above the guidelines range, on STEPHENSON saying he, “cannot, will not live his life without doing harm to others. He is the master manipulator, the puppeteer... He is in my mind a very dangerous man.”
  
  “These defendants tried to mask their crimes with the cloak of free speech and beliefs,” said U.S. Attorney Jenny A. Durkan. “They thought they were immune from the law or the justice system, but now their frauds aimed at taxpayers and public servants need to come to an end. A lengthy prison term is the best way to protect the public from their schemes.”
  
  When investigators served a search warrant at LEAMING’s Spanaway home on November 21, 2011, they found six firearms. LEAMING was prohibited from possessing firearms because of a prior felony conviction of operating an aircraft without a pilot’s license. Additionally, investigators determined that two wanted federal fugitives from Arkansas had been living with LEAMING in his home. Finally, the search revealed that LEAMING and STEPHENSON, who was an inmate at the time in an Arizona federal prison, had been conspiring to file liens against various federal officials including the Arizona prison warden and the head of the Federal Bureau of Prisons.
  
  The men identify themselves as members of the ‘Sovereign Citizen’ movement. ‘Sovereign Citizens’ profess a belief that both state and federal government entities are illegitimate. Members of this group often engaged in so-called “freedom driving,” i.e., driving about without state-required licenses, either for their vehicles or themselves. When contacted by local law enforcement, members of the group often bombard local officials (from the officer, to local judges, to mayors and other members of local government) with frivolous liens, false claims, and sometimes threats of violence. Many members of this same group had previously come to the attention of federal law enforcement for engaging in various fraudulent tax schemes, wire fraud schemes, and (occasionally) inappropriate communications with various members of federal law enforcement and the judiciary.
  
  In asking for a ten year sentence for both men, prosecutors wrote to the court that only a long prison term would protect the public. About STEPHENSON they wrote, “This is not the case of a defendant who continues to run afoul of the law because of a substance abuse addiction or a history of childhood abuse. Rather, this is a defendant who simply chooses to remain defiant, despite court after court telling him that he must stop, and despite multiple stints in prison. At this point, removal from society is the only way in which the public can be kept safe from the defendant’s crimes.”
  
  As for LEAMING, prosecutors provided information to the court about his repeatedly holding himself out to victims as a lawyer who could solve their problems, when in fact his actions may have damaged their case. About the crimes from the March 2013 conviction prosecutors wrote: “Defendant’s possession of firearms is particularly disturbing in light of several facts. First is obviously his disdain for government. Second is his possession of various items of police equipment, including numerous badges, light bars, and a Crown Victoria sedan modified to appear to be a police vehicle. Last but not least is Defendant’s repeated invocation of the shooting of government officials in Southern California by a disgruntled former police officer - which again appeared to be a veiled threat to engage in violence himself if he is prevented from pursuing his “‘petitions for redress,’” prosecutors wrote in their sentencing memo.
  
  Two other defendants active in the Sovereign Citizen movement have already been sentenced to prison for their criminal conduct. David Russell Myrland was sentenced in 2011 to 40 months in prison for making threats against elected officials in Kirkland, Washington. And in 2012 Timothy Garrison was sentenced to 42 months in prison for assisting in the filing of false tax returns.

For the U.S. Attorney press release, see Two Members Of The So-Called ‘Sovereign Citizen’ Movement Sentenced To Long Prison Terms (Defendants Claim to be Tax and Law Experts Damaging Victims and Ensnarling Justice System).

NC Man Allegedly Filed False, 147-Page $3M Lien Against Gov't Employee Who Presided Over Court Hearing That Led To Foreclosure Sale Of His Real Estate; Watchdog Group: Sovereign Citizens Continue "Clogging Up The Court With Indecipherable Filings ..."

In Raleigh, North Carolina, the News & Observer reports:

• A man who lost a block of three Raleigh townhouses to foreclosure late last year has been arrested on a charge of filing a false $3 million lien against the property of the Wake County court clerk who presided over a foreclosure hearing.
  
  Court officials say the lien and a second one that he Sullivan Colin, 36, was trying to file Friday when he was arrested, are part of harassment of court officials by adherents of a "sovereign citizen" movement that denies government authority.
  
  Colin was taken into custody at the Wake County Register of Deeds office Friday afternoon when he went there to file another lien, officials said, and was arrested Friday evening.
  
  Police charged him with two counts of filing a false lien March 26 against the personal property of Nicole Brinkley, a court clerk who had presided over a foreclosure hearing in which Colin lost properties at 3521, 3523 and 3525 Herndon Oaks Way after lawyers for JP Morgan Chase filed a claim last November.
  
  Blair Williams, chief assistant clerk of court in Wake County, said the 147-page lien that Colin filed in March appeared to be similar to a 150-page document he was trying to file when he was arrested.
  
  The lien is the first instance in Wake County, Williams said, of members of a “sovereign citizen” or “sovereign nation” movement filing civil court actions against court officials. There have been cases in western North Carolina, Williams said.
  
  Police said Colin had said at the foreclosure hearing that he would file the claim.

***

• Monday, he was being held in the Wake County Detention Center in lieu of a total bail of $500,000.
  
  The Southern Poverty Law Center, an organization that tracks extremist movements in the U.S., said members of the sovereigns movement “believe that they – not judges, juries, law enforcement or elected officials – get to decide which laws to obey and which to ignore, and they don’t think they should have to pay taxes.”
  
  Adherents, the center said, “are clogging up the courts with indecipherable filings....”

Source: Police charge $3 million lien against Wake court clerk was harassment.

NYC Judiciary Kiboshes 'Honor System' Method Of Oversight In Connection With Attorneys Acting As Court-Appointed Foreclosure Referees & Their Handling Of Proceeds From Public Sales; Recently-Discovered Surplus Snatching Scandal Where Lawyer/Politician Allegedly Used Unclaimed Funds As Campaign Piggy Bank Triggers Reform

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

• State Sen. John Sampson’s alleged embezzlement scheme has sparked specific reform in how city courts handle foreclosure suits, The Post has learned.
  
  The Brooklyn Democrat was indicted last month for allegedly looting $440,000 from four foreclosure accounts he had been appointed to safeguard.
  
  Officials say the alleged scam was aided by a total lack of supervision over the cash raised by the auction of foreclosed properties. “Because of the Sampson situation, we realized we had no way to check up if the referee was complying with the law,” said Lawrence Knipel, the Brooklyn Supreme Court administrative judge for civil matters. “We weren’t double-checking.”
  
  Under the new rule, judges must confirm that money from foreclosure auctions is properly deposited with the clerk and not pocketed by crooked lawyers.
  
  The oversight began about two weeks ago. Similar monitors will be instated in the other boroughs. “Very shortly, this will be administered citywide,” Knipel said.
  
  The reform could also have been accomplished with a change to the statewide law, but it was unclear how long that would take or whether it would ever happen, a court source said.
  
  Civil judges assign attorneys, or “referees,” who are paid $500 to oversee the auction of a foreclosed property, pay off the mortgage and return any leftover money to the homeowner.
  
  Until the recent reform, there wasn’t any mechanism that checked for excess money that should be returned to the homeowner, which allowed crooks to make off with the dough. But now when the winning bid exceeds the amount owed on the house, the clerk will alert the judge and it will be the judge’s responsibility to check 60 days after the auction whether the money was properly deposited, Knipel said.
  
  In a bizarre coincidence, in 2001 Knipel assigned Sampson a Windsor Terrace property that the politician allegedly used as a piggy  bank. Prosecutors say Sampson, 47, used the money to finance his failed 2005 bid for Brooklyn district attorney. Sampson has pleaded not guilty to the embezzlement charges.

Source: Sen. Sampson’s embezzlement indictment spurs reform in foreclosure suits .

Reverse Mortgage Backfires On Another Elderly Homeowner; Now-Widowed Hubby Finds Himself Needing To Cough Up $300K Or Face The Boot From Home Of 40 Years After Being Talked Into Taking Name Off Deed When Refinancing Residence

USA Today reports:

• As America's population ages, the hard sell is on for reverse mortgages. Promising happier days ahead, the former "Fonz," actor Henry Winkler, is giving the hard sell in relentless television ads. But the housing crash and the fiscal state of today's seniors are causing many of these loans to backfire.
  
  Reverse mortgages were originally designed for seniors who wanted to take out their home equity to spend during retirement. Unlike a regular mortgage, they require no monthly payments, and the borrower can take out a lump sum or receive regular payments.

***

• "It sounded good," said Robert Bennett, a homeowner in Annapolis, Md. He and his wife, Ophelia, took out a reverse mortgage at the end of 2008 for about $300,000. They did it to pay off their regular mortgage and stop making monthly payments. At the time, the lender told them only Ophelia's name would go on the loan, as she was 10 years older. The older the borrower, the less risk the lender takes on.
  
  "In the case of some couples, they make a decision up front to remove one member of the couple from the title in order to get more money or in order to qualify for the mortgage," said [the National Reverse Mortgage Association's Peter] Bell.
  
  Bennett said his lender told him he could be added to the mortgage later, but when Ophelia died, just a month after the loan was made, he found out that was not the case.
  
  "It was set up bad," Bennett said, "I wasn't thinking that — that I would be crossed out completely if she died."
  
  Bennett is now fighting foreclosure, trying to save the home he has lived in for nearly 40 years. To stay, he would have to pay back the $300,000, but the house is now worth about half that, so he could never get a loan to cover it. Like millions of others, Bennett has no equity in his home.
  
  Experts argue reverse mortgages often are being used today for all the wrong reasons. Seniors now have less home equity, less savings and more debt.
  
  "This was originally contemplated as something you could draw money from over a long period of time, as a way of supplementing your income or providing income when you had not others. Now a lot of people are looking to reverse mortgages as a quick fix," said David Certner of AARP.
  
  About 9.5% of the 775,000 reverse mortgages outstanding are delinquent, far higher than the rate on regular mortgage loans. While lenders are pushing them aggressively, fewer are being made today, due to the drop in home values. Advocates say they can be a valuable tool, if used correctly, and that there are ample safeguards.

***

• The Consumer Financial Protection Bureau is now looking at new rules to protect consumers, which could include stricter supervision of lenders and more transparency for borrowers.

For more, see Reverse mortgages backfire on some seniors.

Oregon Man Pinched On Suspicion Of Hijacking Possession Of Vacant Foreclosures, Then Pocketing Cash From Subsequent Rentals; Suspect Allegedly Used Online Craigslist Ads To Reel In Unwitting Tenants

In Sherwood, Oregon, KPTV Channel 12 reports:

• If 40-year-old Jason Dimicelli is your landlord, deputies want to hear from you. Lincoln County deputies say he is responsible for a Craigslist scam that has put renters in multiple counties out of their homes.
  
  Dimicelli was arrested in May for renting out a Newport home without the owner's permission. Further investigation has linked Dimicelli to residential properties in Lincoln, Clatsop, Yamhill and Washington counties.
  
  In Sherwood, Shelly Taylor believes she was a victim of the scam. She had been renting a home there from Dimicelli for only two weeks when she started noticing red flags – the home had no smoke detectors, and basic maintenance had been neglected. Further research showed the home was actually bank-owned.

***

• Although she only actually lived there two weeks, Taylor says she had already paid Dimicelli $2,000 and done hundreds more in upgrades to the home – including replacing the missing smoke detectors. Now Taylor says she is out the money, and out of a place to rent.
  
  Deputies say many of the homes in the investigation were either in foreclosure or bank-owned. They are currently investigating how their suspect was able to get into the homes and change the locks.

For the story, see Deputies: Lincoln City man rented out homes without owner's knowledge.

Jacksonville Pair Face RICO, Organized Fraud/Schemes Charges In Alleged Adverse Possession Real Estate Hijacking & Rental Scam Peddled Online; Cops To Prospective Tenants: Stay Away From Websites Like Craigslist When Looking For Houses!

In Jacksonville, Florida, WJXT-TV Channel 4 reports:

• Two people were arrested [] for gaining adverse possession of seven properties and renting them out to families, the Jacksonville Sheriff's Office announced at a news conference [...].
  
  One of those families who was victimized may have been military and new to Jacksonville, police said.
  
  Rosemary McCoy, 55, and Elton McCall, 38, are charged with racketeering, organized fraud, engaging in schemes, conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act, and trespassing.
  
  The duo told tenants they had a property management company named Going Global, which was just a cover, police said. They said the two have been collecting monthly rent of $700 to $1,000 since October after advertising the houses on Craigslist.
  
  Most of the properties were bank-owned and had been or were in the process of foreclosure, police said.

***

• Channel 4 spoke with one of the victims of this scheme, a renter who asked Channel 4 to keep his identity a secret. "they did everything legitimate," said the renter. "Had a lockbox on the door, gave us a tour through the house."
  
  This renter couldn't believe it when he heard from Channel 4 that his landlords, who he pays each month, don't own the house he's been paying rent for since September 2012. The renter also didn't know that the McCoy and McCall were arrested. [...] "Everything seemed legit?" asked Channel 4's Scott Johnson. "Everything," answered the renter, who police tell us is just one of many who were scammed by McCoy and McCall.
  
  Police said investigators have been keeping a close eye on adverse possession applications at the city clerk's office, which is where they became suspicious. Investigators said McCoy and McCall also collected utility payments, water, cable, etc., and they operated the utilities in their names.

***

• McCoy and McCall recently applied for adverse possession of an additional six houses, police said. Investigators are urging potential renters to stay off of websites like Craigslist when looking for houses.

For the story, see 2 arrested in adverse possession cases (Duo accused of racketeering, organized fraud).

Tenant Advocates Accuse Foreclosing Bankster, Law Firm Of 'Constructive Eviction' By Rendering Premises Uninhabitable To 'Persuade' Occupants To 'Voluntarily' Vacate; Family Of 8 Left Literally 'In The Dark' - Other Tenants Successfully 'Scared Out'

In Chicago, Illinois, Progress Illinois reports:

• Eight members of the Shaw family, including a 14 month-old baby, have been living without gas or electricity for nearly a week, according to parents Shantisha and Ezekiel. Their two-bedroom garden apartment in Englewood, on Chicago’s South Side, is flooding and has mold damage. The two apartments above them are vacant, with broken and boarded-up windows.
  
  “We can’t live like this any more,” said Shantisha Shaw, 36, regarding the home she’s shared with her family since February 2011. A stroke survivor, Shantisha is permanently disabled and lives with her husband and six children.
  
  The Shaw’s landlord was foreclosed upon last year and Freedom Mortgage Corp. took over the deed for the building on December 14, as indicated by the Cook County Clerk of the Circuit Court.
  
  But neither Shantisha, nor her husband, Ezekiel Shaw, said they were notified the building was being foreclosed upon. They said they were not given a 90-day notice to vacate, nor were they provided any instructions indicating where they should send their monthly $550 rent — which includes utilities — following the foreclosure.
  
  The Shaws say they were not provided with any landlord or contact information pertaining to who would be responsible for maintaining the property after the foreclosure. “We’ve been left in the dark, literally,” said Ezekiel, 45. “What are we supposed to do?”
  
  He said he’s been given the run-around:
  
  In February the Shaws received an eviction notice from Pierce & Associates, a leading Chicago-based foreclosure law firm. “Demand is hereby made upon you for immediate surrender of possession of the above premises,” the February 4 letter, identifying Pierce & Associates as attorneys for Freedom Mortgage, states.
  
  “But we don’t have any money, I don’t know what they expect us to do,” said Shantisha. She said the building's utilities were shut off last week and “it’s been like hell”:
  
  It is under these conditions that the Shaw family is receiving support from the Keep Chicago Renting Coalition, which hosted a press conference and rally this week outside the family’s home at 6936 South Green St.
  
  According to the group, city law — the Chicago Residential Landlord Tenant Ordinance — requires that landlord notify renters about foreclsoure filings within seven days of the legal action. The coalition also notes that the Illinois Mortgage Foreclosure Law obligates those who take over foreclosures to notify renters of their acquisition of the property within 21 days of securing it. None of this happened in the case of the Shaw family.
  
  Additionally, Pierce & Associates should have given the Shaw family 90 days to vacate the premises, the coalition alleges, as mandated by the federal Protecting Tenants at Foreclosure Act of 2009.
  
  The coalition of community, social service and labor organizations also alleges that Freedom Mortgage violated the Chicago Residential Landlord Tenant Ordinance by failing to maintain the property after they acquired ownership.
  
  “We want Freedom Mortgage to assume responsibility as new owners of the property, and we need Pierce & Associates to apply best practices regarding renters’ rights,” said Dan Kleinman, policy director for Action Now. “When a law-abiding tenant is willing and able to continue paying rent, they deserve the opportunity to keep their lease. And if the bank absolutely refuses, they need to provide a form of compensation that dignifies what the renter is going through.”
  
  The group has reached out to the office of Illinois Attorney General Lisa Madigan. Kleinman said officials expressed interest in helping the coalition pursue the correct means of redress for the Shaw family. “We need to send a clear message to, not only banks, but the legal firms that represent them, that the law has to be followed and renters’ rights have to be respected,” he said.
  
  Kleinman accused Pierce & Associates of “constructive eviction”, which is the illegal practice of rendering a property uninhabitable in the interest of persuading a tenant to leave the premesis on their own volition.
  
  “The Shaws have done nothing wrong,” he said, noting the buildings’ other tenants have already been “scared out.”

For the story, see Englewood Renters Left Without Electricity, Gas Due To Foreclosure: 'We Were Left In The Dark'.

Indianapolis Tenant-Couple Face The Boot After Finding Out Premises Was In Foreclosure; Phony Landlord Was Homeowner's Ex-Hubby

In Indianapolis, Indiana, WISH-TV Channel 8 reports:

• An Indianapolis couple is scrambling to find a new place to live after accidentally finding out their house is in foreclosure. It only took a minute for panic to fill Claudia Mason's chest.
  
  "First was who are you?" A man was taking pictures of her house.
  
  "i Came on out and asked him what he was doing and found out that he was putting notices up on our house for a sheriff eviction," said Claudia.
  
  Just days prior, Claudia and her husband Craig signed their second year's lease. They thought it must be a mistake but after a quick check by the man with the camera. "Not only was the house completely foreclosed, but who we had been paying rent to didn't own the house now or ever," said Claudia.
  
  Turns out, the landlord had been taking the Mason's rent checks while they lived in a house owned by his ex-wife. Meanwhile, the house was falling into foreclosure.

***

• A simple search of public records revealed a long history of financial problems for the landlord; a handful of lawsuits, over $30,000 in property taxes due and he filed for bankruptcy in 2002.
  
  "We've had to completely drain our savings. We've had to scrap and scrounge so that we can get first months and deposit on a new property plus moving expenses," said Craig. "We found out that in 26 days we are basically going to be homeless," said Claudia.

For the story, see Couple finds landlord doesn't own house.

Cops: HOA Prez Pilfered $148K Of Association's Funds From 66-Unit Condo, Then Blew It At Nearby Casino; Arrest Culminates 2+ Year Probe Triggered By Financial Discrepancies Found By Replacement Board Members

In Pembroke Pines, Florida, the South Florida Sun Sentinel reports:

• Luck finally ran out for a Pembroke Pines condo association president accused of gambling away the community's maintenance money at a casino.
  
  Nancy Marquez, 58, was arrested on charges she stole $148,012 from the French Villas condominium association, Pembroke Pines police said. Taken into custody, she admitted she commingled association funds with her own and used the cash to gamble at Seminole Hard Rock Hotel & Casino in Hollywood, investigators said.
  
  "It made my day when I got the call," said current condo board member Paul Coffman upon hearing of Monday's arrest.
  
  Coffman said he and fellow board members found financial discrepancies in January 2011, when he replaced Marquez as association president for the 66-unit building in the 600 block of French Drive. "We got the invoices and everything for the two years that she was on the board and started going through them," he said. "Some things caught our eye that just weren't right."
  
  The board contacted police, who carried out an investigation that more than two years later resulted in Marquez's arrest.
  
  Because of the inquiry, Coffman and other board members couldn't publicly discuss the missing money — even to concerned condo residents, Coffman said. Meanwhile, bills were being paid late because of the shortage of funds, Coffman said. "When people kept complaining, you had to bite your tongue," he said.
  
  The association received notices from the city of Pembroke Pines that the water would be shut off unless utility bills were paid. Florida Power & Light Co. sent notices threatening to switch off electricity that powered hallway and parking-lot lighting in the community.

***

• She was arrested on charges of grand theft and perpetrating a scheme to defraud. She was freed from jail Tuesday on $7,500 bond, records show. [...] In Pembroke Pines, the French Villas condominium association has since managed to pay down its debt through the satisfaction of liens against foreclosed units, Coffman said. As they sold, the association received a percentage of the money, Coffman said.
  
  "We were getting enough money to makes ends meet," he said. "We have caught up." The debt problems have not disappeared altogether, but the association is in better shape. "We're not sailing yet," he said. "We're still in a dinghy, but we're catching up."

For the story, see Condo president gambles away community's money, police say.

HOA Treasurer Pinched, Accused Of Improperly Dipping Into Community's Till In $260K+ Ripoff Over Four Year Period

In Columbia, County, Georgia, WJBF-TV Channel 6 reports:

• Nestled neatly along a country road, the Stratford neighborhood is relatively quiet and peaceful. But, the news of an arrest in the case of stolen homeowners association money has punctured the typical silence.
  
  Neighbor Song Sparks says, "everybody let their guard down because over a number of times the community was thriving, the grass was being cut, everything was being done. We assumed the statements that we got looked pretty on paper."
  
  However, the ugly truth soon reared its head when the dollars and cents didn't add up. It turns out, Stratford Homeowners Association treasurer Laurie Wainwright-Vanover was suspected of taking more than $200,000 from the coffers.
  
  According to the police report, it happened over a four year period through credit cards and ATM transactions. Homeowner's Association president Tom Gorta says, "obviously, you have to be more vigilant than anything and what you take out of this is trust no one."

***

• Laurie Wainwright-Vanover has been released on a $40,000 bond. [...] Deputies arrested Laurie Wainwright Vanover of Andover Court and charged her with Larceny - Theft By Taking (Felony/Misdemeanor), Financial Transaction Card Fraud, Computer Theft, and Theft By Conversion (Felony/Misdemeanor).
  
  Investigators say, Vanover is accused of stealing $267,663.08 from the Stratford Community Association between November 2008 and December 2012. 

For the story, see Treasurer Arrested, Accused Of Stealing HOA Money.

Sticky-Fingered HOA Treasurer Gets 15 Days House Arrest For Embezzling $26K From Outside Employer, Then Using Partial Proceeds To Dodge Jail Time In Earlier $10K HOA Ripoff

In Bonney Lake, Washington, the Bonney Lake-Sumner Herald reports:

• Bonney Lake woman Jeanette Kay Sturtz, 57, was sentenced Wednesday to 30 days community service and 15 days house arrest after pleading guilty to embezzling more than $35,000 from her homeowners association and a Puyallup landscaping company.
  
  Sturtz was charged March 5 for the theft of nearly $26,000 from Blue Sky Landscape Service, where she worked as a financial controller. [...] In the declaration of probable cause for the case, deputy prosecutor Lisa Wagner noted that the thefts from Blue Sky began the same month thefts from Sturtz's homeowner's association ended.
  
  Sturtz was charged in 2011 with the theft of $10,600 from the homeowner's association where she was treasurer. The charges were dismissed under an El Cid diversion program when it was determined she had paid back what she had taken. The Blue Sky case led prosecutors to believe she had embezzled from her employer in part to pay back the association.
  
  "In (the homeowner's association) incident the defendant had admitted to stealing $10,600.00 from her homeowner's association, and she said that the thefts occurred from February to September 2010," Wagner wrote in the probable cause papers. "That latter date is important because the records in the present case show that the defendant began stealing from Blue Sky Landscaping in September, 2010."
  
  In light of the new embezzlement case, the theft charge in the association case was reopened. Sturtz originally pleaded not guilty March 20. With her plea of guilty to two counts of theft in the first degree, prosecutors agreed to recommend she be sentenced as a first-time offender. Twelve charges of forgery were dismissed from the case.

Source: Bonney Lake woman sentenced as first-time offender in employer theft case.

Bankruptcy Appeals Panel OKs Foreclosing Lender's Pursuit Of Deficiency Judgment Despite Failing To File Action Within State Law-Mandated 90-Day Period After Non-Judicial Sale

From Bankruptcy-RealEstate-Insights.com:

• Pierce v. Carson (In re Rader), 488 B.R. 406 (9th Cir. BAP 2013) -
  
  A chapter 7 trustee objected to the unsecured deficiency claim of a mortgage lender that remained after the lender obtained relief from the automatic stay and proceeded with a foreclosure. The trustee contended that the claim should not be allowed because the lender did not comply with a state law requirement that an action must be commenced within 90 days after a non-judicial sale to preserve the deficiency claim.
  
  The bankruptcy court overruled the trustee’s objection, and on appeal the bankruptcy appellate panel affirmed.

***

• As discussed in a prior blog post, under similar circumstances a bankruptcy court upheld an objection to the lender’s deficiency claim based on the effect of the same state law (see What Comes After Stay Relief: The Disappearing Deficiency Claim (Round 1)).

***

• The Rader courts took a diametrically opposite approach. [...] However, on a broader note, the court concluded that the state statute was preempted by the Bankruptcy Code.

For more, see What Comes After Stay Relief- The Disappearing Deficiency Claim (Round 2).

Oregon Supremes Issue Split Decision In MERS Foreclosure Cases

In Salem, Oregon, The Oregonian reports:

• The Oregon Supreme Court on Thursday cleared the way for banks to return to their preferred out-of-court method of foreclosure.
  
  The high court found that Mortgage Electronic Registration Systems Inc., a lending industry cooperative for cataloging loan ownership, can't foreclose on mortgages itself -- as was common in the early years of the foreclosure crisis -- because it's not the beneficiary of a deed of trust.
  
  The court did rule in favor of MERS and lenders, however, by ruling that not all transfers in ownership of a loan need to be recorded in county records before out-of-court foreclosures can proceed. With those ownership records now considered complete, foreclosures can proceed outside the court system at a lower cost to lenders.
  
  The recording decision reverses part of a ruling by the Oregon Court of Appeals, a lower court, that had been the final word in state law until Thursday. After the appellate court issued its decision in July 2012, most lenders diverted their foreclosures into the court system to avoid possible legal challenges.

***

• The rulings came in the form of two opinions. The decision in Brandrup v. ReconTrust Co. (PDF), written by Justice David V. Brewer, answers four questions sent to the state's high court by the U.S. District Court in Portland, which was considering several foreclosure challenges. As a federal court, it defers to state law in foreclosure matters.
  
  In the other, Niday v. GMAC Mortgage LLC (PDF), Brewer wrote an opinion that applied the answers it set out in Brandrup and affirmed the appellate court's finding. The Supreme Court ruled MERS didn't prove it has authority to foreclose non-judicially, and it remanded real estate agent Rebecca Niday's foreclosure case back to the circuit court that had granted summary judgement against her.

For more, see In MERS ruling, Oregon Supreme Court clears way for out-of-court foreclosures to proceed.

See also, HousingWire: Major Oregon Supreme Court ruling undermines MERS, but leaves registry room to challenge.

Wells First To Settle Fair Housing Suit Alleging It Maintained & Marketed REOs In White Neighborhoods Better Than In Black Neighborhoods, Turning Those Vacant Homes Into Dilapidated Eyesores; Suits Against Two Other Banksters Remain Pending

The Blog of Legal Times reports:

• Wells Fargo Bank agreed to pay $42 million to settle a complaint that it failed to maintain foreclosed properties in minority neighborhoods, turning the vacant houses into dilapidated eyesores.
  
  The National Fair Housing Alliance and member organizations sued Wells Fargo in April 2012, alleging in an administrative complaint filed with the U.S. Department of Housing and Urban Development that the bank violated the Fair Housing Act.
  
  The complaint alleged Wells Fargo’s so-called "real estate owned" properties in white areas were much better maintained and marketed than the properties in African-American and Latino neighborhoods. For example, houses in minority areas often had ill-kept yards, broken doors, peeling paint or boarded-up windows.
  
  “Many neighborhoods across the country have been seriously damaged by the foreclosure crisis, including the impact of [real estate owned] homes on property values, curb appeal, and tax revenue for schools,” said Shanna Smith, head of the National Fair Housing Alliance. “Our joint efforts will help lay the foundation for the industry to get some of those neighborhoods back on their feet.”
  
  The housing groups filed similar complaints against Bank of America and U.S. Bancorp, which are still pending.
  
  Wells Fargo—represented by Skadden, Arps, Slate, Meagher & Flom partners Anand Raman and Joseph Barloon, who are both based in Washington—is the first to settle.
  
  According to the plaintiffs, who turned to Joseph Sellers and Peter Romer-Friedman of Cohen Milstein Sellers & Toll, it’s the first-ever agreement regarding the equal maintenance and marketing of bank-owned homes.
  
  Wells Fargo agreed to provide $27 million to the fair housing organizations to promote home ownership, property rehabilitation and development in 19 communities of color, including areas of Baltimore, Washington D.C. and Prince George’s County.
  
  Another $3 million goes to the housing organizations to cover costs and attorney fees. The bank will also pay HUD $11.5 million to support neighborhoods in an additional 25 cities.

Source: Wells Fargo Pays $42 Million in Fair Housing Case.

See also:

• Department of Housing & Urban Development press release: HUD Announces Resolution Of REO Issues With Wells Fargo (Collaboration will Focus on Investment in Communities);
• National Fair Housing Alliance press release: National Fair Housing Alliance and Wells Fargo Announce Collaboration To Rebuild Homeownership Opportunities in 19 Cities (Ground-Breaking Fair Housing Agreement for Marketing and Maintenance of Foreclosed Properties);
• Conciliation agreement;
• Lawsuit: National Fair Housing Alliance v. Wells Fargo, et al.

Minnesota Couple Claiming Sovereign Citizen Immunity From Prosecution Get Nearly Two Years For Filing $114 Billion In Bogus Liens Against Gov't Officials In Retaliation Over Home Foreclosure

In Ramsey County, Minnesota, the Pioneer Press reports:

• A former Minneapolis couple who filed fake liens against public officials were sentenced Friday to nearly two years in prison after a judge denied their attempt to withdraw their guilty pleas.
  
  Thomas Eilertson, 45, and Lisa Eilertson, 49, were taken into custody immediately upon sentencing by Ramsey County District Judge Lezlie Ott Marek.
  
  "These people are selfish, they're bullies -- in fact, they are paper terrorists," said John Ristad of the Ramsey County attorney's office.
  
  On Thursday, the couple sent a 97-page fax to the court, Ristad said. Among the documents were IRS forms "with my name, (County Attorney) John Choi's name, Judge (Teresa) Warner's name and, Your Honor, your name," Ristad said.
  
  The fax also included evidence of "attempts to bully the local newspapers, demanding retractions and threatening sanctions," Ristad said.
  
  The judge agreed with Ristad that the Eilertsons had violated the plea agreement by failing to remove liens they had filed against officials such as Hennepin County Sheriff Rick Stanek, Hennepin County Attorney Mike Freeman and Steven Bruns, an attorney who represented the lender during the foreclosure of the Eilertsons' Minneapolis home.
  
  The paperwork for the lien removal was sent to the Eilertsons' new address in Coleraine, Minn., but the couple returned it, unopened. They also failed to return calls from the probation department to set up a pre-sentence investigation interview, the judge said.
  
  Thomas Eilertson said he had "no idea" that Ristad was going to be sending the paperwork for the lien removal. He also said he believed that "with the rescission of the plea, everything went back to square one."
  
  The judge said that since she had not ruled until Friday on the Eilertsons' motion to withdraw their pleas, they should have continued as they were ordered at the plea hearing. It was "very clear what they needed to do" before sentencing, Marek said.
  
  Had the Eilertsons complied with terms of the plea agreement, they would have been given stayed prison sentences, with a maximum of four months in the Ramsey County workhouse.
  
  Thomas Eilertson called Ristad's description of some of the couple's recent actions "blatant lies." "I object to prison," he said. "I'm not a criminal."
  
  He asked the judge to delay his entry into prison for two days so he could prepare the couple's 12-year-old daughter "for what's about to happen to our family." The judge said no. "Oh, my god," Lisa Eilertson whispered. Thomas Eilertson then asked for a stay of sentence pending an appeal, but Marek again denied the request. "Oh, no, please," his wife said. A deputy told her to be quiet.
  
  The Eilertsons filed false liens against 12 victims, using the name "Blessings of Liberty," according to criminal complaints filed in Ramsey County District Court.
  
  The Hennepin County sheriff's office referred the case to St. Paul police for investigation because several victims are Hennepin County officials.
  
  The Eilertsons' activities stemmed from 2009, when their home at 4448 Cedar Ave. S. in Minneapolis went into foreclosure. They were evicted in July 2010.
  
  A person they corresponded with online gave them instructions on how to file Uniform Commercial Code liens against people in retaliation for their economic problems. They were told that filing under the name "Blessings of Liberty" shielded them from civil and criminal liability. (It did not.)
  
  The Internet acquaintance said the liens, which are claims against an asset, would allow the Eilertsons to "do death by a thousand paper cuts." The liens, filed in 2009 and 2010 with the Secretary of State's office in St. Paul, totaled $114 billion.
  
  "We never wanted to file liens against anybody," Lisa Eilertson said Friday. "We just wanted answers." Asked if she wanted to say anything more before her sentencing, Lisa Eilertson said, "I don't consent. I don't consent to this."
  
  Marek signed an order Friday directing the Secretary of State's office to remove the liens.

For the story, see Minneapolis couple who filed false liens get 2 years each.

NC AG Slams Brakes On Real Estate Operator Allegedly Peddling Homes Using Land Contract/Contract For Deed Racket; Would-Be Buyers In Possession Under Unrecorded Purchase Agreements Say Their Land Was Mortgaged Out From Under Them By Seller

From the Office of the North Carolina Attorney General:

• A North Carolina company that nearly cost more than 20 Surry County residents their homes has been barred from selling real estate in installments, Attorney General Roy Cooper announced today.
  
  “People who wanted a place of their own made payments in good faith but almost lost their homes anyway,” Cooper said. “We work to stop deceptive land deals to keep consumers from getting hurt.”
  
  Cooper alleges that Nichols Land Company misled consumers who entered into installment contracts with the company, promising them that they would own the property in time but then borrowing against it and defaulting on those loans. As a result, more than 20 consumers nearly lost their homes to foreclosure.
  
  Under a judgment approved by Wake County Superior Court Judge G. Wayne Abernathy on Tuesday, Nichols Land Company (Nichols) and its managers, James A. Nichols, Samuel J. Nichols, Roger L. Nichols, and Tina Nichols, are permanently barred from selling real estate through installment sales.
  
  The court order prohibits the defendants from any property sales where the consumer agrees to pay the purchase price in five or more payments while the defendants retain title to the property. If the defendants violate the order, they will have to pay $200,000 in civil penalties.
  
  As outlined in Cooper’s complaint, Nichols began offering Surry County land for sale through installment contracts starting in 2000. Under these contracts, consumers were told that if they put down a non-refundable deposit, paid monthly installments, and paid the annual property taxes to Nichols rather than to local government, they would eventually own a piece of property after a period of years.
  
  Cooper contends that in 2007, Nichols borrowed a total of $600,050 from two banks, using the land it had supposedly sold to consumers as collateral. Nichols continued to market and sell properties even after taking out loans against them. When Nichols failed to repay the loans, the banks began to foreclose on the properties.
  
  As alleged in court filings, Nichols continued to accept payments from buyers and never informed them about the impending foreclosures.
  
  Many buyers were already living on the properties and had spent their own money to improve them by putting in wells, septic systems, foundations and driveways. Consumers would have lost their homes—and the money they’d spent buying and improving the property— if the banks hadn’t agreed to extend them credit to prevent the foreclosures.

For the North Carolina AG press release, see Surry County real estate seller banned from installment sales, AG says (Nichols Land Company took payments for land, didn’t tell residents that banks were foreclosing).

Trash-Out Subcontractor For Now-Notorious Foreclosure Property Management Outfit Pinched For Allegedly Pilfering $42K+ From Home

In Wolcott, Connecticut, the Republican American reports:

• A Maryland man was charged Wednesday with stealing more than $42,000 worth of valuables and a handgun from a Breezy Knoll home while working for a subcontractor of a property management company, according to court documents.
  
  The property management company, Safeguard Properties, was the focus of a recent report by the Huffington Post(1) in which a former employee claimed he had received a "constant barrage" of complaints about subcontractors breaking into homes to steal heirlooms, artwork and weapons.(2)

For more, see Maryland man tied to theft in Wolcott.

(1) See Safeguard Properties Internal Documents Reveal Rampant Complaints Of Thefts, Break-Ins.

(2) For those homeowners who've been screwed over by wrongful trash-outs, lock-outs, etc. 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).

B.C. Regulator: Many Scam Victims Left Destitute After Being Conned By Dubious Investment Peddler Into Borrowing Against Their Homes To Buy Shaky Securities

In Vancouver, British Columbia, The Vancouver Sun reports:

• A Victoria-area financial adviser has been accused of illegally selling more than $65 million worth of high-risk securities to hundreds of investors, many of them seniors, leaving a trail of financial devastation.
  
  In a notice of hearing Thursday, the B.C. Securities Commission alleged that from June 2007 to December 2010, David Michaels — doing business as Michaels Wealth Management — advised 484 clients to purchase more than $65 million worth of “exempt-market” securities without being registered to advise in securities.
  
  The notice also alleges he defrauded investors by “repeatedly and falsely” claiming that he gave up his earlier registration as a stockbroker because he had lost faith in the stock market when, in fact, he had relinquished his licence in the face of an investigation.
  
  The notice says he targeted retirees through monthly seminars, a weekly show on CFAX 1070 radio and one-on-one meetings, and that he promoted the securities as being less risky than publicly traded stocks and in some cases recommended that investors borrow against their homes to finance the purchases.
  
  The securities were, in fact, extremely risky. They included investments in a couple of oil and gas start-up companies, a company that bought insurance policies at a discount from terminally ill people, and a long-term care facility development in Sidney.
  
  For Michaels, it was a very lucrative business. According to the notice, he collected nearly $5.8 million in commissions and marketing fees from the issuing companies during the material period.
  
  For investors, however, the investments were disastrous: “Almost all of the roughly $65 million invested by Michaels’ clients is now worthless, leaving many of them destitute while their home equity loans remain,” the notice alleges.

For more, see B.C. Securities Commission launches hearing in alleged $65-million investor fraud (Victoria-area financial advisor David Michaels accused of perpetrating massive fraud).

For the British Columbia Securities Commission press release, see BCSC alleges that Vancouver Island man illegally advised hundreds of people and perpetrated fraud.

For the formal charges, see Notice of Hearing: In re Michaels.

Bankruptcy Appeals Court: Homeowner's Challenge To Foreclosing Bankster's Right To Enforce Promissory Note Requires Evidentiary Hearing; Order Granting Automatic Stay Relief Reversed

From a recent ruling by a 3-judge Bankruptcy Appellate Panel for the 10th Circuit Court Of Appeals:

• A mortgage creditor may seek stay relief to pursue its nonbankruptcy law remedies in enforcing its mortgage on a debtor’s home. But, as in any other civil proceeding, that creditor must demonstrate standing to invoke the court’s jurisdiction and the bankruptcy court has an affirmative obligation to determine whether its jurisdiction has been properly invoked.
  
  Here, the debtor, Dianna Kay Steinberg (“Debtor”), challenged the bank’s standing by questioning whether it had the right to enforce the note.
  
  The bankruptcy court granted the motion without providing an opportunity for a hearing on that very important threshold issue.
  
  Debtor appeals the bankruptcy court’s order granting Bank of America, N.A.’s (“BOA”) motion for relief from the automatic stay to foreclose on its interest on her home.
  
  We REVERSE the order of the bankruptcy court and REMAND the motion for a determination whether the creditor holds the note or may enforce the note on some other legal basis.(1)

For the rest of the court's ruling, see In re Steinberg, BAP No. WY-12-082 (10th Cir. BAP May 30, 2013) (unpublished).

Thanks to Deontos for the heads-up on this court ruling.

(1) From the court's ruling:

• Once the issue of BOA’s standing to enforce the Note was raised, the bankruptcy court was required to resolve it on the merits.
  
  Indeed, the Tenth Circuit has previously said as much in In re Miller. There, the Tenth Circuit held that a secured creditor must demonstrate that it has a “right to payment” by adducing evidence that it possesses the note.
  
  And in In re Thomas, we held that if a secured creditor’s possession of the note is challenged, the bankruptcy court has a “duty to ensure that debtors are not subjected to legal challenges by those without standing to do so” by conducting an evidentiary hearing at which the creditor must demonstrate either its possession of the note or some other legal basis for being able to enforce it.
  
  Here, the bankruptcy court granted BOA’s motion without conducting any inquiry into that important threshold issue. Because the bankruptcy court had an affirmative obligation to determine whether BOA has standing, it abused its discretion in granting relief from stay when it failed to conduct an inquiry into whether BOA had possession of the original note.
  
  We therefore reverse the order of the bankruptcy court and remand the motion for a determination whether BOA holds the Note or may enforce the Note on some other legal basis.

Real Estate Brokerage Left Holding The Bag On $29K HUD Fair Housing Settlement Alleging That Since-Fired Sales Agent Inadvertently Left Voice Message With Black Prospective Homebuying-Customer Indicating Belief That White Neighbors Would Panic At Prospect Of Him Moving In

From the Department of Housing & Urban Development:

• The U.S. Department of Housing and Urban Development (HUD) announced [] that LLB&B, Inc., a real estate company based in Mobile, AL, will pay $29,000 as part of a Conciliation Agreement resolving allegations that one of its agents refused to show a condominium to a prospective homebuyer because he is African American.
  
  The homebuyer alleged that he learned of the discrimination when the real estate agent inadvertently left a message on his telephone voicemail indicating her belief that white neighbors would ‘panic’ at the prospect of an African American neighbor.
  
  The Fair Housing Act makes it unlawful to discriminate in the sale or rental of housing based on, race, color, national origin, religion, sex, familial status, or disability. It also prohibits refusing to show a condominium to a prospective buyer and making statements that discriminate because of race or color.

***

• Under the terms of the agreement, LLB agreed to pay the man $29,000, require fair housing training for all its employees, and include the fair housing logo in all its advertising.
  
  The case came to HUD’s attention when a man filed a complaint with HUD, alleging that a real estate agent with whom he inquired about the sale of a condominium inadvertently left a voicemail with him indicating she did not wish to deal with him because he is African-American.
  
  In the message, the real estate agent, referring to the white neighbors who lived near the condominium, allegedly stated, “Those people will panic when they see a black person drive up and look at it.” She added: “I called him back. He didn't answer so that was good! If I didn’t call him back he could sue me for prejudice.”
  
  The man shared the recording with a HUD investigator, who then shared it with the real estate company. Upon hearing the message, the owners of LLB&B terminated the agent’s employment.

For the HUD press release, see HUD And Alabama Real Estate Company Settle Claim Alleging Agent Discriminated Against African American Homebuyer.

Ex-Investment Bankster Accused By His 86-Year Old Mom Of Strong-Arming Her Out Of Dead Hubby's Will, Swiping $500K+ Proceeds From Sale Of Marital Home

In New York City, the New York Post reports:

• A former Lehman Bros. banker strong-armed his 86-year-old mother out of her husband’s will — and took a half-million dollars from the sale of her Fifth Avenue home, she charges in a lawsuit.
  
  Helen Bacanovic, who stood by her older son Peter’s side when he was convicted of perjury in the 2004 Martha Stewart trial, lost her husband, Rabe, in January.
  
  Her younger son, Paul, 49, filed a will with the court in February that named him as its “sole executor” and “left [Helen] no money,” the Manhattan Supreme court papers charge.
  
  But his ailing mom insists in an ongoing Manhattan Surrogate’s Court case that Rabe’s “signature on page seven of the purported will appears to be a forgery.”
  
  In that proceeding, Paul argues that his parents were separated when his dad died and that his dad willingly signed over his $220,000 estate to Paul’s kids.
  
  His mom says she “suffered a stroke” on March 13 “and is in desperate need of money for her medical care and maintenance.” She adds that she sold the two-bedroom condo that she and Rabe owned at 923 Fifth Ave. for $1.6 million last spring and now lives on East 67th Street.
  
  But, she says, Paul swiped $515,000 from that sale. He claims in legal papers that was to repay a $500,000 loan he gave his parents.
  
  A lawyer for Paul yesterday declined to comment until after they’ve reviewed the lawsuit. His brother, Peter, 51, declined to comment outside his mother’s new Upper East Side digs.

Source: Ex-Lehman Bros. banker strong-armed Peter Bacanovic's mom out of her husband's will and took $500K: lawsuit.

For the lawsuit, see Bacanovic v. Bacanovic.

Chicago City Council OKs Ordinance Requiring Foreclosing Banksters To Offer Existing Renters In Tenant-Occupied Homes Either Rent-Controlled Lease Or $10,600 Relocation Payment As Protection From Unwanted Boot

In Chicago, Illinois, WBEZ Radio 91.5 FM reports:

• The Chicago City Council on Wednesday afternoon approved protections for renters whose units have entered foreclosure. The ordinance passed in a 45-4 vote after more than a year of organizing by tenant advocates.
  
  The measure, dubbed Keep Chicago Renting, will require the foreclosing bank to provide the tenants a rent-controlled lease until selling the property or pay them a “relocation assistance” fee of $10,600 per unit. The goal is to keep renters in their homes and keep the buildings from standing vacant and breeding crime.

***

• An earlier version of the proposal, introduced by Ald. Richard Mell (33rd) last July, would have prohibited post-foreclosure evictions outright except under narrow circumstances such as the tenants’ failure to pay rent.
  
  Mayor Rahm Emanuel’s administration worried that version might not withstand legal challenges. Instead of the eviction ban, the city pushed for requiring the banks to pay the relocation fee. Negotiations between City Hall and tenant advocates dragged on for months. The sides did not finalize the amount of the fee until last week.

For more, see City Council enacts ‘Keep Chicago Renting’ ordinance.

More On Sovereign Citizens & The Use Of 'Paper Terrorism' To Take Over Possession Of Homes, Cloud Land Titles

In Montgomery County, Maryland, the PotomacPatch reports:

• The Jan. 5 takeover of an unoccupied Bethesda mansion may sound pretty far-fetched and even a bit wacky, but it's serious stuff, the head of the Montgomery County Police Department's Vice and Intelligence Unit said Wednesday in an interview with Patch.
  
  MCPD released photos Tuesday of a suspect in the case, which has been deemed a burglary of the home in the 7000 block of Natelli Woods Lane. Another man, who is charged in the burglary, told police that he claimed the vacant mansion as a member of the Moorish Nation.
  
  "It's a very conspiratorial, very organized crime," MCPD Sgt. Kenneth Penrod said.
  
  The so-called Moorish Nation is composed of self-defined Moorish nationals who believe the U.S. government is not legitimate. Moorish nationals believe they are descended from the Moors, who once inhabited the land now governed by the United States, they say. Because the U.S. took the land from the Moors illegally, they argue, they have the right to take over property—like the burgled Bethesda mansion.
  
  The Moorish Nation is one of several groups that adhere to a sovereign citizen ideology—"a conspiratorial belief system that argues that most Americans are not subject to most tax and criminal laws promulgated by the government," according to the Southern Poverty Law Center.
  
  Members of sovereign citizen groups often use "paper terrorism," filing bogus tax documents claiming ownership of a property and filing liens against the government trying to uphold the law, Penrod said. So far, this has happened mostly in southern states—including Virginia, Georgia and North Carolina—although New York City has seen it too, he said. This creates a lot of paperwork in the courts, because once a lien is filed, it's hard to get it removed, Penrod said.

For more, see 'Moorish National' Burglary of Bethesda Mansion Part of Larger, Potentially Violent Conspiracy (Case is Montgomery County's first property takeover by members of a sovereign citizen group).

Does Bankster's Switch From Non-Judicial Process To Judicial Foreclosure Lawsuit To Force Home Sale Violate Earlier-Granted Preliminary Injunction In Colorado Case? Judge To Decide

In Denver, Colorado, The Denver Post reports:

• The federal judge poised to decide whether Colorado foreclosure laws are unconstitutional is taking a moment to determine whether lawyers still trying to take an Aurora woman's house are using a loophole to bypass the court.
  
  U.S. District Court Judge William J. Martínez on Tuesday gave lawyers for U.S. Bank until June 12 to prove they had not violated an earlier court order to leave Lisa Brumfiel's four-bedroom house alone until the constitutional question had been decided.
  
  Brumfiel filed an emergency motion to sanction the lawyers — foreclosure attorney Larry Castle and his Castle Law Group — and the investment trust that holds the note on Brumfiel's house. Brumfiel said they violated Martínez's earlier order to "maintain the status quo" while her federal lawsuit was pending.
  
  At issue is whether the bank and trust could rescind the foreclosure case that gave rise to Brumfiel's lawsuit, then file a new one in state district court using a different set of laws to accomplish the same thing.

For more, see Judge eyes sanctions in Colorado foreclosure case.

3rd Circuit: Wheelchair-Bound Homeowner's Use Of ATV On HOA's Public Streets Not A 'Reasonable Accomodation' Under Fair Housing Act Where Benefit To Homeowner "Is Outweighed Substantially By The Potential Danger That [Its] Use Could Cause" To Community's Residents

From a recent Justia.com Opinion Summary:

• Plaintiffs and their son appealed the district court's summary judgment holding that they were not entitled under the Fair Housing Amendments Act of 1988, 42 U.S.C. 3601-3631, to an accommodation and a modification that they requested from the HOA.(1)
  
  Plaintiffs had requested a modification to add a ramp leading to the front door of their home(2) for use by their son, who required the use of a wheelchair. Plaintiffs also requested an accommodation to an HOA policy prohibiting the use of certain types of vehicles to allow the son to use an ATV within the community.(3)
  
  The court vacated the district court's holding on the merits of the modification request for the wheelchair access ramp because that claim was not ripe; affirmed the district court's holding with respect to the accommodation request for permission to use an ATV because that request was not "reasonable" within the meaning of the Act;(4) and affirmed the district court's denial of defendants' request for attorneys' fees and costs.

Source: Opinion Summary: Scoggins v. Lee's Crossing Homeowners Assoc.

For the ruling, see Scoggins v. Lee's Crossing Homeowners Assoc., No. 11-2202, No. 11-2373 (4th Cir. May 17, 2013).

(1) The Fair Housing Legal Clinic of The John Marshall Law School, Chicago Illinois, provided support in preparing the briefs for the homeowners in this case. The Clinic, a Qualified Fair Housing Organization, was established and staffed with full-time attorneys to train and educate law students how to represent victims of housing discrimination.

(2) 'Home' for the Scoggins is "a ten-acre lot [purchased] in 2002 in Lee's Crossing, a subdivision in Loudoun County, Virginia, where they built a home in which they have resided for several years."

The public streets within the Lee's Crossing subdivision are described as "unpaved, making it difficult for Jacob [plaintiff's partially-paralyzed son] to travel within the community using either his manual or power wheelchair."

(3) The restrictive covenants contain rules governing activities conducted on the common grounds of Lee's Crossing. These rules include a policy prohibiting the use of off-road vehicles such as ATVs on the common driveways and roads of the community.

(4) Part of the court's analysis and ruling on this specific point follows ('Jacob' is the plaintiff's partially-paralyzed son who requires the use of a wheelchair; his right to operate an ATV on the family's own 10-acre property is not at issue here):

• Without question, the plaintiffs established that use of an ATV would make it easier for Jacob to travel on the unpaved roads of Lee's Crossing, and that it would be impractical for him to use his power wheelchair for this purpose because of the potential damage to the wheelchair's electronic components. Accordingly, the plaintiffs established that the use of an ATV would afford Jacob the benefit of easier transportation within the community.
  
  Nevertheless, the present record shows that such benefit to Jacob is outweighed substantially by the potential danger that use of the ATV could cause to the residents of the community. The defendants produced overwhelming evidence showing that the use of an ATV as a general matter within Lee's Crossing, and Jacob's use of such a vehicle in particular, present a significant threat to Jacob's own safety as well as to the safety of the other residents of the community.
  
  Among other items, the defendants included in the record a copy of the owner's manual (the manual) for the ATV model that Jacob sought to operate.
  
  The manual emphasizes that the use of the ATV is "FOR OFF-ROAD USE ONLY," and that the ATV does not conform to federal motor vehicle safety standards. The manual contains the additional warning that "the ATV does not have turn signals and other features required for use on public roads." Separately, the manual again states that "[y]ou should never ride your ATV on public streets, roads or highways, even if they are not paved. Drivers of street vehicles may have difficulty seeing and avoiding you, which could lead to a collision." (Emphasis added.)
  
  The evidence further showed that drivers traveling the roads of Lee's Crossing are permitted to operate their vehicles at speeds up to 35 miles per hour, in excess of the speed limits in effect on many public roads. Thus, it is of particular note that the Code of Virginia prohibits, as a general matter, the operation of any all-terrain vehicle "[o]n any public highway, or other public property." Va. Code § 46.2-915.1.
  
  We also observe that the defendants' expert witness, Gary E. Kilpatrick, a certified professional engineer with experience in the operation of ATVs, submitted a report describing the dangers inherent in operating an ATV in an area such as Lee's Crossing. In his report, Kilpatrick stated that "ATVs are designed specifically for operation on off-road dirt terrain," and that the tires of an ATV "do not handle well on hard packed dirt roads, graveled roads and hard surfaced paved roads." Kilpatrick further opined that ATVs are difficult for drivers of other vehicles to see and are not equipped with headlights, brake lights, or other devices to make them visible to other drivers on the road.
  
  In addition to this evidence concerning the general dangers of operating an ATV within Lee's Crossing, the defendants produced evidence showing the increased danger posed in ATV use by persons who have physical impairments. In his report, Kilpatrick stated that riding an ATV is physically demanding, and that, to operate an ATV safely, a rider must "have full use of his entire body, especially his hands, arms, torso and legs." Kilpatrick, who examined Jacob's medical reports, opined that the physical limitations caused by Jacob's partial paralysis render his use of an ATV very dangerous, and that the medication he takes to control spasms in his lower extremities poses additional dangers. Accordingly, Kilpatrick concluded that "because of the hazards associated with riding ATVs, the surrounding terrain and his physical limitations, [Jacob] is and will be a danger to himself, other drivers, [and] pedestrians" if he were allowed to operate an ATV within Lee's Crossing.
  
  The plaintiffs have not refuted the defendants' evidence that any operation of an ATV for other than off-road uses is inherently dangerous.[11] Instead, the plaintiffs challenge Kilpatrick's conclusion that Jacob's physical limitations make his use of an ATV exceptionally dangerous. The plaintiffs rely primarily on Jacob's own testimony, in which he stated that he could operate an ATV safely, and on a video recording of Jacob operating an ATV on the plaintiffs' property without incident.[12]
  
  Having considered this evidence alongside the defendants' evidence, we conclude that the plaintiffs have not presented facts sufficient to create an issue for trial whether Jacob could operate an ATV within Lee's Crossing without creating a danger to the residents of the community. Cf. Williams v. Giant Food Inc., 370 F.3d 423, 433 (4th Cir. 2004) (plaintiff's subjective belief about her abilities, absent sufficient objective corroboration, cannot defeat summary judgment).
  
  In light of this conclusion, we need not reach the other elements of the ATV request claim, including whether the request would be "necessary" to afford Jacob an equal opportunity to enjoy the Lee's Crossing community.[13]
  
  Accordingly, we affirm the district court's award of summary judgment in the defendants' favor on the ATV request claim, because the plaintiffs failed to establish that the proposed accommodation is "reasonable," within the meaning of the FHAA. See Bryant Woods, 124 F.3d at 604 (directing courts to consider the benefits of the proposed accommodation against the extent to which the legitimate purposes and effects of the regulation would be undermined by the accommodation).

Big Apple Housing Authority To Cough Up $70K, Agrees To Create, Maintain Accessible Apartment Building Front Entrance Ramp As Part Of Fair Housing/Disability-Discrimination Suit Settlement

From a recent press release from the Fair Housing Justice Center:

• Federal District Judge William H. Pauley approved a settlement in May 2013 between three public housing tenants with disabilities and the New York City Housing Authority (NYCHA).
  
  The settlement resolves a lawsuit filed in August 2012 by tenants with mobility impairments who reside at the Fulton Houses located in the Chelsea area of Manhattan. The lawsuit alleged that the plaintiffs were discriminated against based on disability in violation of the Americans with Disabilities Act (ADA), the Rehabilitation Act and the New York City Human Rights Law.
  
  In the complaint, plaintiffs asserted that the building they reside in lacked an accessible entrance. The complaint alleged that a ramp leading to the entrance of the building was too steep and dangerous and that it prevented tenants with disabilities from safely leaving or entering the building. The plaintiffs alleged that repeated requests were made for a reasonable modification of the entrance over many years and NYCHA was largely unresponsive.
  
  The Fair Housing Justice Center (FHJC) investigated a complaint received from one of the tenants by obtaining a report from an FHJC cooperating architect. After documenting the inaccessible entrance to the building, the FHJC assisted the tenant to obtain legal counsel.
  
  The settlement requires that NYCHA create and maintain an accessible ramp at the front entrance of the building at 418 W. 17th Street within 120 days of the order and an architectural design expert retained by the plaintiffs will evaluate the ramp to confirm compliance.
  
  Also, the agreement provides that the staff at NYCHA’s Fulton Houses development will participate in disability discrimination training. Finally, NYCHA agreed to pay a total of $70,000 to cover damages for three tenants and attorney’s fees. The tenants were represented by Kevin M. Cremin and Orier Okumakpeyi with MFY Legal Services, Inc.

For the press release, see Tenants Resolve Disability Discrimination Lawsuit (NYCHA To Modify Building Entrance & Pay $70K To Settle Case).

Fair Housing Suit: Operator Of Independent Senior Living Residences Discourage, Refuse Renting To Wheelchair Users; Management Accused Of Making Intrusive, Discriminatory, Medical, Religious Inquiries

The Fair Housing Justice Center recently announced:

• On May 29, 2013, the Fair Housing Justice Center (FHJC) filed a lawsuit in federal court (S.D.N.Y.) alleging that the owners and managers of five independent senior living residences with more than 600 apartments discriminate on the basis of disability, religion, and race.
  
  The FHJC alleges that the Esplanade Residences located in Staten Island, Manhattan, Westchester County, and Rockland County maintain policies and engage in practices that violate local, state, and federal fair housing laws.

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• In September 2012, the FHJC received a complaint based on a letter to the editor which appeared in the Staten Island Advance (www.SILive.com). The letter accused the Staten Island Esplanade of refusing to rent to persons who use wheelchairs.
  
  Rather than deny the allegation, an agent for the Esplanade wrote: “The Esplanade is a community catering to active independent senior residents. The Esplanade is not an assisted living facility. As such, our residents are ambulatory and do not require the use of wheelchairs.”
  
  In response to this complaint, the FHJC commenced an undercover testing investigation and sent matched pairs of testers to Esplanade residences over four months. At each of the five locations, one tester inquired about housing for an elderly relative with disabilities who uses a wheelchair and the other tester inquired about housing for a non-disabled elderly relative.
  
  Some examples of the alleged discriminatory conduct cited in the complaint include:
  
  • The Manhattan Esplanade refuses to rent to prospective residents who use wheelchairs. An agent for the Manhattan Esplanade told a tester “you have to come in vertical.” The same agent explained that if existing residents start using a wheelchair, “We don’t even allow wheelchairs in the dining room.” According to the agent, residents who use wheelchairs have to eat in a separate dining room with other wheelchair users and their aides. When the tester asked why people who use wheelchairs need to be separated, the agent stated because “it depresses the elderly” to see people using wheelchairs.
  
  • At the Esplanade at Palisades, an agent told a tester that “power” wheelchairs are not allowed.
  
  • At the White Plains Esplanade, when a tester told an agent that his relative used a manual wheelchair, the agent stated that would be acceptable as long as she was “self-propelled.”
  
  • At the Esplanade at Chestnut Ridge, an agent stated that, even though there was an elevator to the second floor, wheelchair users are only allowed to rent apartments on the first floor and that existing residents were given a preference for first floor apartments. The agent admitted that with these policies, more apartments would be available to the tester’s relative if she did not use a wheelchair. The agent later explained that when “independent” seniors come into the residence and see people using wheelchairs or walkers, they are immediately “put off.”
  
  • At the Esplanade Staten Island, a tester was informed that motorized wheelchairs are not allowed.
  
  • To rent at any of the Esplanade residences, applicants are subjected to intrusive and discriminatory medical inquiries and required to obtain a physician’s report and disclose any mental or physical disabilities as part of the rental application process.
  
  • At several Esplanade residences, agents asked testers about their relative’s religion. All Esplanade residences use an application form that requests the applicant’s religion and whether an applicant is “practicing.” In a newspaper article, an Esplanade employee referred to life at the residences as “the Jewish hotel experience.”
  
  • Esplanade brochures and websites use only white human models to depict residents.

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• The lawsuit seeks injunctive relief to stop the discrimination and ensure future compliance with fair housing laws, in addition to damages, costs, and attorney’s fees. The FHJC is represented by Diane L. Houk, of Emery Celli Brinckerhoff & Abady, LLP, and Kevin M. Cremin and Nahid Sorooshyari of MFY Legal Services, Inc.
  

For the press release, see FHJC Investigation Uncovers Discrimination in Senior Living Residences.