Saturday, May 23, 2009

Foreclosing Lender Screw Ups When Seizing Collateral Not Limited To Homes As Boat Repo Firm Twice Takes Wrong Vessel - Once With Owners On Board

In Fort Lauderdale, Florida, the South Florida Sun Sentinel reports:
  • A Fort Lauderdale company that claims to be the biggest boat repossession firm in the world has run into trouble for twice seizing the wrong vessel, once with the owners inside. Walter and Joann Dethier were in bed in their 40-foot Magnum sport cruiser, tied to a Key Largo marina, when they heard thumps as electric power lines were disconnected from the marina and tossed on deck. Running out of the cabin, Walter Dethier saw a boat towing them from shore. He jumped onto the dock, and with the help of a neighbor, a retired police officer, successfully challenged the five repo men, who lacked the proper papers. The boat had no liens on it, and when they called the police, the repo crew ran off. Two months later, at home in Connecticut, the couple got a call from the marina manager saying their boat was being taken again.


  • The company admits fault, and the Dethiers, outraged at National Liquidator's failure to take elementary precautions before seizing a boat, as well as what they say is $20,000 in damage to the boat's hull and electrical systems, have retained a lawyer and filed a complaint with the Florida Department of Agriculture and Consumer Services. "They're totally out of control," said Walter Dethier, 65, who had been trying to sell the boat for $289,900. "They're operating as vigilantes. My wife won't sleep on the boat anymore."

  • The Monroe County Sheriff's Office investigated and advised the arrest of the repo team leader, Jason Barroncini, for criminal mischief. But the [state] attorney's office said it should be handled in civil court.

For more, see Couple's boat wrongly repossessed twice by National Liquidators. ForeclosureLockOuts

NYC Pro Bono Recruiting Meetings Begin This Week; Outreach Program Needs Attorneys For Housing, Consumer Credit, Immigration Law For The Unrepresented

In New York City, the New York Law Journal reports:
  • The first of five meetings to recruit, motivate and inform attorneys for the new NYC Legal Outreach initiative will be held [Tuesday night, May 26] in Brooklyn. The campaign is an "unprecedented" joint effort by the judicial and executive branches to expand pro bono legal assistance, Corporation Counsel Michael A. Cardozo said in an interview. The joint program is an attempt to address the growing number of unrepresented consumers with financial and immigration problems brought on by the weak economy.


  • At a press conference last month, Mr. Cardozo said New York City does not intend to "reinvent the wheel," but hopes to use the "mayor's bully pulpit" to boost existing volunteerism. In a May 12 letter to bar groups, law schools and the 100 largest law firms, Mayor Michael R. Bloomberg and [Chief Judge Jonathan] Lippman said that NYC Legal Outreach will target four key areas: foreclosure, eviction, immigration and consumer credit.

  • "Whether you are fully employed, retired, recently laid off or deferring employment, there is a place for you at this 'table,'" the letter said. At the press conference in April, Judge Fern A. Fisher, deputy chief administrative judge for courts in New York City, said there were some 600,000 filings last year in consumer credit and housing cases. Upward of 90 percent to 95 percent of litigants in housing cases are unrepresented, and as many as 99 percent of litigants in consumer credit cases appear pro se.


  • [The Tuesday, may 26th] meeting will be held at Brooklyn Borough Hall, 209 Joralemon St. at 6:00 p.m. Additional meetings will be held on June 8 in the Bronx, June 17 on Staten Island, June 22 in Manhattan and June 25 in Queens.

For more, see City, Courts Kick Off Campaign to Encourage Lawyers to Volunteer.

For times and locations of the five meetings, see the Mayor and Chief Judge's May 12th letter.

NY Fed Looks To Iron Out Conflict Of Interest Issues With City's Largest Law Firms On Pro Bono Help For Homeowners In Foreclosure

In New York City, The Am Law Daily reports:
  • The Federal Reserve Bank of New York has summoned lawyers at some of the city's elite law firms and largest banks for a meeting Wednesday to discuss the low participation in a year-old waiver program meant to allow firms to handle foreclosure cases for homeowners pro bono. [...] At the time of its launch, the program, called the Lawyers Foreclosure Intervention Nework (LFIN), stressed [conflict-of-interest] waivers for firms that represent financial institutions; the expectation was most of the lawyers would come from such firms. But a year later, the program's participants are largely solo practitioners and small firms, with only a couple lawyers from large firms.

  • Fed officials are now trying to figure out if there's a way to bolster participation. A copy of Wednesday's agenda, obtained by The Am Law Daily (download the document), outlines an array of possible fixes, including allowing lawyers at large firms advise volunteer lawyers for the homeowners anonymously.

For more, see New York Fed To Convene Meeting on Foreclosure Pro Bono.

Go here for Wednesday's meeting agenda.

Foreclosure Of NH Assisted Living Home Gets Go-Ahead; Elderly Residents Could Face The Boot; Lender Expects To Acquire Facility & Continue Operations

In Portsmouth, New Hampshire, SeacoastOnline reports:
  • After a three-year fight in the state’s bankruptcy court, The Pines at Edgewood assisted living residence has been foreclosed and will be sold during a June 3 public auction, said Concord attorney Carl Anderson who represents the mortgage lender. Anderson said the auction of the at 936 South Street facility is expected to conclude “a long-fought case,” during which owner David Ramsey objected to the bank’s reorganization plans.


  • As of Friday, Ramsey was in agreement with the current plan which has Flash Island collecting all rent from the 15-bed facility and paying all of the bills, including payroll, said Anderson. At the same time, he said, Flash Island has partnered with a “subsidiary” which will bid during the auction and has applied for a state license to operate a residential home care facility.

  • Anderson said it’s his hope that the subsidiary will be the highest bidder and resume operations as they are now.(1) If that’s the case, the current administrator will keep her job and residents’ lives will be uninterrupted, he said. If a high bidder wants to change the current use, they must give residents notice by law, said the Concord attorney.

For more, see Assisted living residence foreclosed, to be auctioned.

(1) For sale is the circa 1900 Victorian building on 1.6 acres of hillside property. According to a legal notice for the auction, the 7,529 square foot building has eight private rooms, 3 semi-private rooms a 2-bedroom apartment for the administrator, a dining room, kitchen and great room. “It is important that the residents of The Pines not be needlessly disturbed by the foreclosure sale process,” said Anderson. “The intent, and in my view likelihood, is that the day-to-day operations will continue the same.”

100+ Rescued Animals Face Foreclosure From RI Farm; Owner Says Servicer Screw-Up When Mortgage Was Sold Led To Failure To Properly Apply Loan Payment

In Glocester, Rhode Island, WPRI-TV Channel 12 reports:
  • A Rhode Island farmer who helps abandoned and even tortured animals may have lost the fight and is now facing eviction. Dan Mackenzie's foreclosure deadline ended without an extension, leaving him and more than a hundred rescued animals on the edge of eviction or worse. "A lot of them are old, crippled, abandoned, abused, diseased," says Mackenzie. He paid his mortgage on Bonniedale for eight years but when the note was sold, the new bank didn't get the payments and the foreclosure was underway and unstoppable.


  • He raised almost enough for a down payment on a re-finance. But now he needs a new bank or an extension from his old bank. "We need help plain and simple." He thinks the eviction could come any day and that most if not all the animals would go to slaughter.

For more, see Farm faces eviction, animals at stake (Owner fears all animals will be slaughtered).

See also, Farm helps animals in need, seeks help (A confusing paper trail that connects a well-known local farm to three banks and a potential foreclosure. Stuck in the middle is the owner and about 100 animals. Now, his neighbors are trying to help.).

For other posts on animals facing foreclosure, go here, go here, and go here. ForeclosurePetsAlpha

Oregon Bride Persuades Judge To Open Shuttered Hotel In Foreclosure To Host Wedding; Now Cries Foul Over "Extorionate" Receivership Bill

In Hood River, Oregon, The Oregonian reports:
  • Plenty of brides gnashed teeth, sobbed and cried foul in January when the landmark Columbia Gorge Hotel abruptly closed, keeping their wedding deposits. But just one, Lynne Haaland of Toluca Lake, Calif., fought the distance. She persuaded a judge to order the hotel's court-appointed receiver to allow her wedding ceremony.

  • On Saturday, Haaland, 40, tied the knot with Aaron Shepard, 37, at the Hood River hotel, becoming Lynne Shepard. By all accounts the wedding and reception on the spectacular spring day were fabulous, fulfilling her dreams.

  • Yet now the Shepards, honeymooning on the Oregon coast, are stunned by the receiver's invoice: $17,938.60, including a $6,650 lawyer's bill and a $2,000 "landscape fee." The interim receiver, Gorge Rentals Property Management Inc., defends the charges as appropriate. "I'm getting slightly extorted," Lynne Shepard said. "They know I wanted the place so bad."

For more, see Fighting bride KO'd by bill (if link expires, try here).

Scammers Putting Bogus Chinese Drywall Notices On Vacant Homes In Foreclosure To Drive Down Prices At SW Florida Courthouse Sales?

In Cape Coral, Florida, WINK News reports:
  • A mystery in Cape Coral. Notices, warning of Chinese drywall, are popping up on vacant homes in the city. The catch: The warnings are fake! The yellow notices claim to be from the Department of Health, and say the home has been inspected and contains Chinese drywall. Many of the homes are in foreclosure.

  • The Lee County Health Department first learned of the fraud from a home inspector and a realtor. They say no health agency within the county or state does these types of inspections.

  • Why would someone post fake notices? Local realtor Ron Martin with Sun Realty has a theory. He's seen several of the notices on properties over the past few days. "There seems to be a common theme to the ones I've seen and that is that they're all scheduled to be auctioned at the courthouse within 48 hours," said Martin. "One would have to suspect that someone is trying to discourage competition."

  • Posting these fake notices is a crime, and anyone with information is asked to contact the Cape Coral Police Department or call 1-866-9-NO SCAM.

Source: Fake Chinese drywall notices! (Fake Chinese drywall notices on homes in Cape Coral).

Go here for other posts on Chinese drywall.

Elderly Cincinnati Tenants In Bedbug-Infested Building Send S.O.S.; Landlord, City Refuse Assistance In Battle Against Blood Suckers

In Cincinnati, Ohio, WLWT-TV Channel 5 reports:
  • A Tri-State apartment building for seniors is infested with bed bugs and the residents are claiming that nobody will give them the help they need. The Cincinnati Health Department said the responsibility for battling the bugs lies with the landlord. However, residents said they've been begging for help for years to no avail.

  • Deborah Scott said the only defense against the dreaded blood-sucking fiends is her bottle of bug spray. Other residents of the Hillrise Apartments for Seniors in College Hill use their own weapons such as stuffing towels under their doors. The suffering seniors said they buildings management is aware of the problem but has done little to battle the bugs.

For more, see Seniors Battle Bed Bugs At Infested Apartment Complex (Residents Say No One Will Help Them).

Friday, May 22, 2009

Florida Courts Continue Efforts To Establish Loan Workout Procedures In Foreclosure Actions

In South Florida, the Daily Business Review reports:
  • As a state task force labors to develop a uniform statewide approach to the onslaught of foreclosure cases, Broward and Palm Beach counties are rolling out new programs of their own.

  • Palm Beach Chief Circuit Judge Kathleen Kroll will launch a pilot program next month allowing homeowners to confer with law clerks and court interns to get help understanding the paperwork and see if they’re eligible to rework their loan. [...] Broward Chief Circuit Judge Victor Tobin plans to require lenders to make a good-faith effort to meet with all homeowners interested in settling their foreclosure cases. Both are trying to solve complaints by mortgage holders who say they can’t find anyone in a position of authority at their lender to work with them.

  • The Miami-Dade Circuit Court created a mandatory mediation program last month for cases involving owner-occupied homes. [...] Others counties around the state are pursuing different options for bringing their foreclosures caseloads under control. A task force formed by the Florida Supreme Court issued an interim report last week suggesting it would recommend uniform case management procedures and a model mediation program.

For more, see Courts initiate programs to assist homeowners in resolving cases.

Scammer Cops Plea To Illegally Pocketing $140K From Elderly Clients Promoting Phony Foreclosure Flipping Business

In Oshkosh, Wisconsin, the Appleton Post Crescent reports:
  • An Oshkosh man faces prison after he was convicted Monday of two counts of security fraud and one count of selling an unregistered security in a scam that netted nearly $140,000 from elderly clients. Mark H. Brenner, 50, was found guilty of the charges [...] after entering guilty pleas to the felony charges.


  • The criminal complaint said the charges stem from a series of transactions that Brenner had with an elderly husband and wife. Brenner told the couple that his real estate business, Valley Home Buyers, purchased distressed properties, repaired and refurbished them, and then resold the properties for a profit.

  • The couple invested nearly $97,000 between November 2001 and November 2002, with promises of annual interest of 10 to 15 percent. Brenner owed the couple $105,000 by November 2004, entered into another agreement with the couple, and stopped all payments in April 2005. [...] The complaint said Brenner and Valley Home Buyers never purchased a single property and that Brenner used these investment funds to pay his living expenses and interest payments. The investigation also revealed that from 1990 to 1994, Brenner was sued numerous times, resulting in money judgments against him and one foreclosure. The complaint said that Brenner never told investors of his legal woes.

For the story, see Oshkosh man convicted in security fraud scam on elderly.

Ohio AG Threatens Homeowner With Foreclosure Over $24.66 In Flat Tire Mishap

In Fayetteville, Ohio, WCPO-TV Channel 9 reports:
  • A broken road reflector cost Paul Holden the price [of] a new tire, and now it could cost him his home. That's the threat from the Ohio Attorney General if Holden doesn't pay another $24.66 the state says it spent investigating his claim for the flat tire.

For more, see Man Gets Flat Tire, State Threatens Foreclosure.

Go here for the threatening letter from the Ohio Attorney General's office.

Another Foreclosing Lender Screw Up Puts Homeowner Out Onto Street, Belongings Dumped On Front Lawn

In Gwinnett County, Georgia, WSB-TV Channel 2 reports:
  • A Gwinnett County woman is trying to put her life back together after an alleged foreclosure mistake left her home a wreck. Eviction crews dumped all of her belongings in her front yard. But, she said it was the bank that failed to process her loan modification paperwork. Judi Moser said her life is as shattered as her precious crystal. "It's about 150 years old and it's gone," she said, talking about her now-broken crystal bowl. "Who would let people come in and just destroy a lifetime of things," asked Moser.

  • She showed Channel 2 Action News reporter Richard Elliot what's left of her life after deputies and crews evicted her from her home of 29 years -- only to put it all back when they learned the bank made a mistake. "And then they said, 'Oops, wrong, we made a mistake. Let's put everything back,'" said Moser.

For more, see Woman Blames Bank For Eviction Mistake.

Go here for Slideshow of Lender Screw Up.

Go here for other posts on lender screw ups. ForeclosureLockOuts

Thursday, May 21, 2009

Ohio Appeals Court Affirms Theft Convictions, Reverses Others In Cleveland-Area Equity Stripping, Foreclosure Rescue Sale Leaseback Scam

An Ohio appellate court this month issued rulings, affirming in part and reversing in part, the convictions of two criminal defendants in connection with an equity stripping, foreclosure rescue scam.(1)

Defendant Sammy Quick appealed his convictions for two counts of theft, securing writings by deception, mortgage broker prohibition, and receiving stolen property. Defendant Brian Cicerchi appealed convictions for theft, securing records by deception, and telecommunications fraud.

After considering the matter, the appeals court reversed the convictions of securing writings by deception as to both defendants, and the conviction relating to mortgage broker prohibition as to Quick. All other convictions were affirmed.

For the entire rulings of the Ohio appeals court, see:

(1) The victims in this case were an elderly woman suffering from Alzheimer's and her adult daughter who was struggling with drug dependency problems. According to the court decisions, the daughter, who was facing foreclosure, called Sammy Quick and asked him for assistance. He proposed a scheme whereby she could save her home and continue to live there, while at the same time working toward reestablishing her credit. He told her they would “take the house out of my name” for a period of one year to 18 months and at the end of that time, the house would “go back into my name and that I would begin to make payments.” During the time that she did not have title to the house, she would pay rent to the person who did own title. The homeowner testified that at no point did she understand Quick to be proposing that she would sell her house, and she believed that she would get her house back after she rehabilitated her credit. Quick soon asked the homeowner to “sign[] some papers,” but she did not know what those papers were. She thought that she would be receiving $10,000 to pay off her credit cards as a result of transferring the house, but received nothing.

List Of Homeowners Being Forced From Homes By Chinese Drywall Continues To Grow

In Parkland, Florida, CNN reports:
  • Sherri and Ira Rojhani stopped paying the mortgage on their 2-year-old South Florida home in April, victims not of a troubled economy, but, they say, of drywall from China that they believe is making them sick. They join a growing list of homeowners in 13 states who face foreclosure or the prospect of paying both their mortgage and rent on alternate housing as they seek relief from what they describe as corrosive gasses emitted from the Chinese drywall(1). The drywall is now the subject of several scientific studies. [...] Espinal made a 40 percent down payment on his home. He's concerned and angry about what's happened to his investment.

For more, see Chinese drywall hits health, wallets, homeowners say.

In a related story, see Get out of house, doctor tells family.

Go here for other posts on Chinese drywall.

(1) According to the story, the U.S. Consumer Product Safety Commission says Florida leads the nation in complaints about Chinese drywall. Other complaints from homeowners are coming from Louisiana, Virginia, Wisconsin, Ohio, Alabama, Mississippi, Missouri, California, Washington, Wyoming, Arizona, Tennessee and Washington D.C. Many homeowner's have turned to their home insurance companies for help, only to find that any problems would not be covered by homeowner's policies.

Failed Attempt To Take Out Mortgage On Mom's Home Among Criminal Charges Facing Louisiana Woman

In Alexandria, Louisiana, The Town Talk reports:
  • An Alexandria woman faces several charges after she reportedly forged several checks from her mother's account, attempted to take out a second mortgage on her mother's home and stole and pawned the woman's jewelry. Angela Fay Koelling, 39, of [...] Alexandria, was charged with five counts of forgery, theft of more than $500 and identity theft.

For the story, see Alexandria woman accused of ID theft. TheftOfDeedMeta

Oklahoma Man Faces Felony Charges For Renting Vacant Homes In Foreclosure Without Owners' Knowledge

In Tulsa, Oklahoma, KSWO-TV Channel 7 reports:
  • Tulsa County prosecutors have filed charges against a man accused of renting foreclosed homes he didn't own or have authority to rent. Mike Remington is charged with felony obtaining money by false pretense. He's accused of finding homes in foreclosure where the owners have moved - then renting those homes to other people without the knowledge of the owners. Remington has denied wrongdoing and said he had the permission of mortgage companies or the homeowners to rent the houses.

Source: Man charged with renting homes fraudulently.

Go here, go here, and go here for posts on phony landlord rent scams. PhonyLandlordScamZeta

Wednesday, May 20, 2009

FTC Obtains Court Order Halting Scammers' Use Of "" Link To Deceptively Divert Comsumers Seeking Free Mortgage Assistance

From the Federal Trade Commision:
  • At the Federal Trade Commission’s request, a federal district court issued an order to stop an Internet-based operation that pretends to operate “,” the official Web site of the federal Making Home Affordable program for free mortgage loan assistance. The FTC alleged that the defendants deceptively diverted consumers who searched online for the free government assistance program to commercial Web sites that offer loan modification services for a fee.

For the entire press release, see FTC Obtains Court Order Halting Deceptive Mortgage Relief Internet Ads; Marketers Falsely Claimed to Operate

For the court order, see FTC v. One or More Unknown Parties Misrepresenting Their Affiliation With the Making Home Affordable Program.

(1) According to the FTC’s complaint, the defendants purchased “sponsored links” for their advertising on the results pages of Internet search engines, including,, and When consumers searched for “making home affordable” or similar search terms, the defendants’ ads prominently and conspicuously displayed the Web site address “” Consumers who clicked on this advertised hyperlink were not directed to the official Web site for the Making Home Affordable program, but were diverted to Web sites that solicit applicants for paid loan modification services. These commercial Web sites, which are not part of or affiliated with the U.S. government, require consumers to enter personally identifying and confidential financial information. The operators of these Web sites either purport to offer loan modification services themselves or sell consumers’ personally identifying information to persons who sell such services.

Federal Judge Dismisses Cleveland Public Nuisance Suit Against Big Banks Over Subprime Mess That Left Neighborhoods In Ruins

In Cleveland, Ohio, The Plain Dealer reports:
  • U.S. District Judge Sara Lioi has dismissed Cleveland's lawsuit against large investment banks that Mayor Frank Jackson believes enabled the subprime lending and foreclosure crisis here. In a 36-page decision (download PDF file), Lioi ruled that the city's public nuisance complaint was "pre-empted" by a section of Ohio Revised Code that does not allow municipalities to regulate lending. She also wrote that the city failed to demonstrate an unreasonable interference with a public right and that the city did not prove that the banks named in the suit caused the damages.


  • Jackson filed the suit in January 2008, contending that Wall Street giants such as Deutsche Bank and Goldman Sachs irresponsibly bought and sold high-interest home loans. These practices, the mayor argued, depleted the city's tax base and left neighborhoods in ruins.
    The city has appealed Lioi's ruling.

For more, see Lawsuit blaming banks for foreclosure mess in Cleveland is dismissed by federal judge.

Go here for the federal court's ruling.

For the original lawsuit, initially filed in state court and subsequently moved to federal court, see City of Cleveland v. Deutsche Bank Trust Company, et al.

Former Spouse Used Bogus POA To Secretly Take Out Mortgage On Long Island Mansion Now In Foreclosure, Says Ex-Wife

In Brooklyn, New York, the New York Post reports:
  • With all the defiance of a spoiled mob princess -- and the dramatic acting chops of an Oscar diva -- foreclosure victim Victoria Gotti vowed yesterday that no one will be kicking her out of her Long Island estate, insisting, "This is by no means over!"

  • "I'm never going to lose the house -- trust me," Gotti, 46, the daughter of late Mafia boss John Gotti, said outside court, where she attended a hearing on the dispute. "The only way I'm leaving is selling it."

  • [This month], an appeals court allowed lender JPMorganChase to foreclose on the Old Westbury estate because Gotti hasn't made payments on a mortgage with a $650,000 balance in the past two years. To keep the property, which is now on the market for $3.2 million, Gotti is banking on help from the same man she blames for her financial mess: ex-husband Carmine Agnello.

  • Gotti said her shifty former spouse secretly took out the mortgage on the mansion in 1996 by falsely claiming she had given him power of attorney -- and then left her holding the bag for the debt when he transferred his share of the estate to her in 2005.


Hubby Forged Signature on Loan Application, Pocketed £48,000 In Mortgage Proceeds, Says Estranged Wife

In Wales, United Kingdom, the South Wales Echo reports:
  • A CAR dealer accused of forging his wife’s signature on a £48,000 loan application after she left him owned a Porsche, two Spanish villas and a £1m house at the time, a court has heard. Businessman Nigel Bowen, 52, admitted he had since been declared bankrupt, but said he had plenty of money options in 2006 when the mortgage advance – which needed to be signed by both of them – was taken out with Northern Rock.


  • Melanie Underwood, who married him in 2003, last week told the jury that the first she knew about the £48,477 added to the existing mortgage was when she asked the company for a redemption figure because she intended to get a divorce. A handwriting expert said her signature on the application form was a forgery.

For more, see Forge accused had plenty of cash, trial told. TheftOfDeedMeta

Now-Bankrupt Husband Accused Of Forging Spouse's Name On $13M+ In Mortgages Secured By Family Home; Wife, Three Kids Now Face Foreclosure

In Brisbane, Australia, The Sunday Telegraph reports:
  • THE wife of declared bankrupt and former Billabong surfwear boss Matthew Perrin has made startling allegations of identity fraud and forgery in a Supreme Court bid to protect her luxury Gold Coast mansion from the circling Commonwealth Bank.

  • Nicole Perrin claims her signature was forged on two mortgage documents and on a guarantee against loans worth more than $13 million extended to her husband by the bank, court documents show. The Commonwealth Bank claims Mrs Perrin last year took out two mortgages against her $15 million Surfers Paradise mansion, where she lives with the couple's three children. The bank has applied for a court order to repossess the two-storey Cronin Island home after Mr Perrin declared himself bankrupt in March. [...] Mrs Perrin has applied to the Supreme Court in Brisbane for a restraining order to stop the bank taking the home. In her claim, Mrs Perrin says she did not authorise or consent to the mortgages and says it is not her signature on a loan guarantee.
For more, see Wife of bankrupt surfwear mogul claims fraud.

See also, The Sydney Morning Herald: Forgery claims sent to police.

Go here, Go here, Go here, Go here, Go here, Go here, Go here, and Go here for other posts related to deed or refinancing scams by forgery, swindle, power of attorney abuse, etc. TheftOfDeedMeta

Tuesday, May 19, 2009

MERS Jammed In Attempt To Foreclose In 27 Cases; Not A Real Party In Interest, Lacked Standing, Failed To Produce Note, Says Nevada Bankruptcy Judge

In Las Vegas, Nevada, Las Vegas Business Press reports:
  • A Las Vegas bankruptcy judge has dealt a blow to an obscure but critical piece of the mortgage enforcement machinery that could slow foreclosures. After a rare hearing in front of three judges last year that initially encompassed 27 cases, U.S. Bankruptcy Court Judge Linda Riegle has ruled that the Mortgage Electronic Registration System (MERS) could not represent lenders seeking to foreclose on delinquent homeowners already in bankruptcy unless it could produce the actual loan note. This goes to the heart of how home lending has evolved over the past two decades, with a loan rarely staying on the books of the originator but often being sold several times to other institutions or investment groups. As a result, producing a loan document is far more complex than opening a drawer in a filing cabinet.


  • Riegle's ruling not only parsed federal and state law but at least implicitly rapped MERS on the knuckles for its practices. For example, she noted that MERS acted as the attorney on several loans in Las Vegas even after they were transferred to non-MERS members. She also rejected the argument that lenders who belong to MERS and designated it to be their legal representative should be good enough for the court. Without the loan papers, she concluded, MERS' terms and conditions for its members do not give it any rights to foreclose under Nevada law." To reverse an old adage," she wrote, "if it doesn't walk like a duck, talk like a duck and quack like a duck, then it's not a duck."

For more, see Judge's ruling deals blow to national mortgage servicer.

For the judge's ruling, see In re Mitchell.

For posts that reference the failure of mortgage lenders and their attorneys to file the proper paperwork when bringing foreclosure actions, Go Here, Go Here, Go Here, Go Here, Go Here, Go Here, and Go Here. EpsilonMissingDocsMtg

10th Defendant In Maryland-Based Foreclosure Rescue Scam Takes Guilty Plea

In Greenbelt, Maryland, WJZ-TV Channel 13 reports:
  • A 10th person has pleaded guilty in a $35 million mortgage foreclosure rescue scam. Federal prosecutors say 34-year-old Ronald Chapman Jr. of Washington faces up to 30 years in prison and a $1 million fine for conspiracy to commit mail and wire fraud. He pleaded guilty on Monday.

  • Authorities say Chapman and others, through the Lanham-based Metropolitan Money Store, targeted homeowners who risked losing their homes. The scheme took advantage of homeowners and lenders by using straw buyers, fraudulently obtained loans and inflated real estate appraisals to strip equity from more than 100 homes from 2004 to 2007. Losses attributable to Chapman's role are between $200,000 to $400,000. As part of his plea, Chapman has agreed to pay restitution for the full amount of victims' losses.

Source: 10th Defendant Pleads Guilty To Mortgage Fraud.

For the press release from the U.S. Attorney's office, see Loan Officer Pleads Guilty in over $35 Million Mortgage Fraud Scheme (Ten Defendants Have Pleaded Guilty in the Metropolitan Money Store Conspiracy, Including Mortgage Brokers, Real Estate Agents, Loan Processors and Officers, an Attorney and U.S. Census Bureau Employee, and Family Members).

For the indictment, see U.S. v. JoyJackson, et al.

Stiffed Sub Slaps Lien On Homeowners For Unpaid Work, Leaving Them With Having To Pay Twice For New Pools Or Face Foreclosure

In Casselberry, Florida, WFTV Channel 9 reports:
  • Customers of a well known pool company got shocking news this week. A subcontractor was never paid. So there are now liens against their homes forcing the homeowners to pay a second time. [...] Greg Vanek paid Florida Pools of Casselberry in full more than 6 thousand dollars. Then a lien notice arrived by mail, a subcontractor was never paid by Florida Pools. So a lien demanded Greg pay another 5 thousand dollars. [...] Under Florida's Construction Lien Law----a homeowner is responsible for bills the contractor doesn't pay. Unless they pay off the liens, pay twice, worst case they face foreclosure. [...] 3 other Florida Pool customers have been liened, and others [...] were notified a lien's on the way.


  • The best protection, demand signed waivers of liens from all subcontractors before you pay - a complicated process for homeowners. "I don't know enough about liens to even ask that," said Greg Vaneck. If you have signed waivers of lien from subs and suppliers, you can't be forced to pay a second time.

For the story, see Pool Customers Face Liens On Their Homes. StiffingContractorsTheta

Do-It-Yourself Steps In Getting A Mortgage Loan Modification

On his website, Jack Guttentag, The Mortgage Professor writes:
  • If you can no longer afford your mortgage payment, but you can afford a lower payment, and if you cannot lower your payment by refinancing, you should seek a modification of your loan contract.

For the do-it-yourself steps that he suggests in getting a mortgage loan modified, see The A, B, Cs of Getting Your Mortgage Modified.

For the information required by each of the major servicers, and how to access their required questionnaire, see Mortgage Servicer Information Requirements.

Foreclosed Homeowner Accused Of Leaving Behind Suspicious Devices Faces Felony Charges As Cops Evacuate Area Residents

In Riverside, California, KABC-TV Channel 7 reports:
  • Bomb disposal experts [were] at a foreclosed home in Riverside [last week] that was apparently booby-trapped. Several suspicious devices were also located on the property. Realtor Ken Kelley was on the property inspecting the house [...] when he saw what appeared to be pipe bombs [...].

  • Officers arrested the former homeowner, identified as 42-year-old Daniel Gherman from Riverside. Bomb squads detonated one of several devices found on the property. The device was apparently a fake bomb, but they also found what appeared to be a booby trap.

  • Residents in the area were evacuated for a short time. Experts are still working to make sure there are no more dangerous devices in or around the house, and they are concerned the house may be booby-trapped inside. Kelley said there were tripwires inside the home. [...] Even though the pipe bombs outside the home turned out to be fake, Gherman is still facing felony charges, and more charges may be added, depending on what authorities find inside.

For the story, see Foreclosed home apparently booby-trapped.

Go here and go here for other posts on the encounters of police and sheriff's deputies involving foreclosures and evictions. DeputyEvictionTheta

Monday, May 18, 2009

Lenders' Failure To Comply With Bailout Bill Has Florida Attorney Seeking To Delay, Dismiss Foreclosure Actions

In Fort Lauderdale, Florida, the Daily Business Review reports:
  • Lenders receiving U.S. government stimulus money are required to offer distressed homeowners reasonable loan workouts to prevent more foreclosures. But critics say that’s often not happening. Claiming lenders aren’t working with borrowers, Weston attorney Jonathan Kline is in state court trying to block the first of dozens of foreclosure cases.

  • Kline has asked judges to dismiss or delay about 10 cases. He argued the lenders [...] are not complying with the Emergency Economic Stabilization Act of 2008, the bailout bill that originally authorized the Treasury Secretary to spend $700 billion to purchase distressed assets of the largest U.S. banks.


  • The bailout bill requires lenders receiving federal money — including those servicing Fannie Mae and Freddie Mac loans — to offer “reasonable loan modification based on three areas, including reducing the interest rate, reducing the principal amount of what is due and elongating the term of the loan,” Kline said. Kline said he is planning to file similar motions in all of the approximately 200 foreclosure cases he has working.

  • Last week, Kline presented the argument for the first time before Broward Circuit Judge Jack Tuter in a foreclosure case against U.S. Bank, the trustee for Homebank Mortgage Trust, which originated Fannie Mae and Freddie Mac loans. Tuter rejected Kline’s request for dismissal of the foreclosure. “He said it would have been better to present it in an evidentiary hearing, but he liked the argument,” Kline said. Kline said he may request a second hearing and will use that argument on other cases.

For more, see Weston attorney says banks fail to do required workouts.

Go here for Kline's Amended Motion To Abate Or Dismiss Foreclosure Proceedings.

For other posts on homeowners using state & federal laws to stave off foreclosures, Go Here, Go Here, and Go Here. UndoMortgageLoans TILAdelta EpsilonMissingDocsMtg SloppyForeclosuresAlpha

Texas AG Files Civil Suit Charging Loan Modification Firm With Selling Worthless Rescue Services To Homeowners Facing Foreclosure

From the Office of the Texas Attorney General:
  • A Harris County district judge froze several Houston firms’ assets after Texas Attorney General Greg Abbott charged the companies with running foreclosure “rescue” scams. According to the state’s enforcement action,(1) the defendants fraudulently charged their customers for worthless “rescue,” debt counseling and credit repair services. District Judge Patricia J. Kerrigan also granted the Attorney General’s request for a temporary restraining order.

For the entire press release, see Attorney General Abbott Charges Houston Firms with Conducting Fraudulent Foreclosure Rescue Scam (Assets Belonging to Excel Loss Mitigation, United Servicing, others frozen by Attorney General).

For more on this case from the Texas AG:

(1) The state’s enforcement action names Excel Loss Mitigation Inc., United Servicing LLC, Bell Investments & Developments LLC and key directors Frank Bell, David Bell and David Espy as defendants. All of the defendants were also charged with failing to post a bond with the Texas Secretary of State, which is required to legally conduct business in the state of Texas. Excel, which was renamed United Servicing after an influx of customer complaints, proactively contacted hundreds of homeowners who were struggling to pay their mortgages, according to the press release. The Office of the Attorney General is seeking civil penalties of up to $20,000 for each violation of the Texas Deceptive Trade Practices Act, as well as restitution for harmed customers. In addition, the Attorney General seeks penalties for numerous violations of the Texas Telephone Solicitation Act and the state’s Finance Code.

25+ Year Squatters In Abandoned NYC Building Score Big Win; Obtain Title To Manhattan Apartment House As Co-Op

In New York City, the New York Post reports:
  • Sometimes crime does pay. Nearly 30 years after an eclectic group of poets, performers, anarchists and artists illegally occupied a burned-out East Village tenement, they've officially become a Manhattan co-op.

  • Last Monday, the group signed off on the final paperwork allowing them to legally call their one-bedroom apartments home. They're now owners of the Bullet Space building -- named after the art gallery and community space on its ground floor. The cleaned-up, five-story cooperative at 292 E. Third St. is a far cry from the rat-infested hellhole into which they first moved in the 1980s as squatters. Back then it was so derelict, its owners chose to walk away rather than pay taxes. Now the city says it's worth $2.2 million, and real-estate experts estimate its market value between $4 million and $5 million.


Financially Strapped Oregon Couple Bail Out On Loan Modification Attorney; Stops Check, Opts For Free Counseling Instead

In Gresham, Oregon, KGW-TV Channel 8 reports:
  • A mortgage scheme nearly snagged a Gresham couple. [...] “My husband’s trucking business came to a stop and we got really far behind in our house payments,” said Patricia Harmon. A television commercial from Christian M. Dillon attorney at law seemed to have the solution. “It was pretty much a guarantee they could get our loan modified and our payments lowered,” said Harmon. The company wanted $3,000 up front. Harmon was desperate, she wrote a check.


  • Harmon said Christian M. Dillon attorney at law told her to stop all contact with her mortgage company. “Don’t talk to them, even if they call you. Now I discover that's one of the first signs of a scam, is when they tell you not to talk to your mortgage company,” said Harmon. Harmon learned the company had a history of consumer complaints in the nick of time. She canceled her check.


  • The BBB gives the California company an F rating and the Oregon Attorney General recently helped a homeowner in Newport get their money back from the company. Fortunately, you don't have to pay for mortgage counseling. A government approved counselor helped Harmon for free. Christian M. Dillon attorney at law has not returned calls from KGW.(1)

For the story, see Gresham couple avoid suspected mortgage scam.

(1) For a story from The Tampa Tribune on the experience of a Florida homeowner who paid an upfront fee for loan modification services, and who responded to a television commercial from California attorney Christian M. Dillon, see Home sweet home: Beware of foreclosure rescue scams, fees.

Sunday, May 17, 2009

Disbarred New Jersey Attorney Cops Plea To Illegally Pocketing Client Cash From Closing Proceeds In Real Estate Transactions

From the Monmouth County, New Jersey Prosecutor's Office:
  • On May 11, 2009, Gary Edelson, 48, formerly of Red Bank, N.J., appeared in Monmouth County Superior Court and pled guilty to the crime of second degree Misapplication of Entrusted Property. The charge resulted from an investigation which was conducted by the Monmouth County Prosecutor's Office regarding funds that Edelson, an attorney, illegally retained in and dispersed from his attorney trust account.


  • During the course of his representation of his clients in [various] transactions, Edelson deposited large sums of his clients’ money into his attorney trust account. [...] The investigation further revealed that instead of disbursing his clients’ funds in order to finalize the real estate transactions as Edelson was required to do, Edelson instead illegally retained and disposed of more than $300,000 which he was holding in trust. The investigation also revealed that Edelson used funds from his trust account to pay for personal expenses such as his rent, medical insurance, office expenses, and taxes, and that he improperly transferred funds from his trust account into his business account.

For the entire Monmouth County Prosecutor's press release, see Former Red Bank Lawyer Pleads Guilty to Misapplication of Client Funds.

If a New Jersey attorney, in the course of representing you, screws you out of money or property through dishonest conduct, go to the New Jersey Lawyers' Fund for Client Protection for more information.

For other states and Canada, see:

New Workbook Gives Guidance For Financially Strapped Arizona Homeowners

From the Office of the Arizona Attorney General:
  • Consumers at risk of foreclosure are encouraged to do their homework before contacting lenders and servicers. The Arizona Foreclosure Prevention Task Force has developed an easy to understand workbook to guide families through different options and scenarios in order to prepare for meeting with lenders or certified counselor at a HUD approved agency.


  • In addition to providing consumer information, the workbook also describes tactics used by many unscrupulous firms who scam families that are seeking assistance. "This workbook is an important resource for families who are looking at a foreclosure situation." says Patricia Garcia Duarte, Chair of the Arizona Foreclosure Prevention Task Force. [...] The workbook has examples of letters that consumers can read and be prepared to draft for their own use, budget forms to help them document their income and assets, and even a telephone or contact log to help them keep track of discussions and correspondence in trying to resolve their mortgage predicament.

For the entire press release, see Arizona Foreclosure Prevention Task Force Urges Consumers at Risk of Foreclosure to Be Prepared (Workbook developed to help consumers have discussion with lenders).

Go here for the Arizona Foreclosure Information Workbook.

Real Estate Agent Suspected Of Key Role In Mortgage Scam Now Accused Of Rent Skimming By Disgruntled Tenant

In Tampa, Florida, the St. Petersburg Times reports:
  • Tampa real estate agent Lori Polin played a key role in one of the state's "most dramatic" mortgage fraud schemes, according to Florida's attorney general. Polin is still an agent — and she's still engaged in questionable dealings, an angry tenant claims.

  • Jeff Cole, who rented Polin's Tampa condo, says she collected over $14,000 in rent yet stopped making mortgage payments and did not inform him that the bank was foreclosing — an increasingly common problem for tenants in a tanking real estate market. Polin, who still has a $50,000 homestead exemption, also asked Cole and his mother not to tell the bank she was renting out the condo for fear it would kill a sale, he said.

  • "She accepted rent for nine months while lying to her mortgage company about her occupancy status," Cole said. "She asked me and my mother to keep her little secret … to save her own a---." Polin, who works for ReMax Power Advantage in Tampa, did not return phone calls seeking comment. Jeremy Anderson, head of the office, would not comment.

For more, see Tenant paid thousands in rent for condo that was in foreclosure.

Home Improvement Contractor Gets Prison Time In $80K+ Ripoff; Accused Of Shoddy, Incomplete Work On 88-Year Old Widow's Home

From the Office of the New York Attorney General:
  • Attorney General Andrew M. Cuomo [...] announced the sentencing of a Western New York home improvement contractor who repeatedly pressured an 88-year-old widow into paying more than $80,000 for home improvements that were never done or “grossly substandard.”

  • Bryan Boone, 47, of [...] Kenmore [dba Urban Residential Maintenance], was sentenced to the maximum 2 1/3-to-7 years in prison [... and] ordered the defendant to pay full restitution. Boone pleaded guilty to grand larceny in the third degree (class D felony) on November 7, 2008.

  • This so-called home improvement contractor was nothing more than a con artist who thought he could get away with ripping off an 88 year-old widow,” said Attorney General Cuomo. “My office will aggressively pursue crooked contractors who prey on New Yorkers, especially the elderly and vulnerable.”


  • Boone’s work was careless and incomplete. [...] Independent experts who reviewed Boone’s work at the request of the Attorney General’s Office declared it to be grossly substandard and of little value to the homeowner. They estimated the cost of labor and materials to be between $11,000 and $13,000. Besides shoddy and incomplete work, Boone also failed to meet the legal requirements for home repair work, including obtaining the proper permits, providing a written contract to the consumer, and depositing payments into a trust account.

For the entire press release, see Home Improvement Contractor Sentenced To Prison For Scamming Western New York Senior Out Of More Than $80,000 (Bryan Boone pressured 88-year-old widow into writing more than 70 checks over seven months for ‘grossly substandard’ work).

For more on homeowners left in the lurch due to actions by builders/contractors, go here, go here, go here, go here, and go here.

Go here, here, here, here, here, and here for other posts on elder financial abuse.

Go here for other posts on other home improvement contractors hammered by the NY AG. Cuomo hammers contractors FinancialAbuseOfElderlyAlpha StiffingContractorsTheta

Media Probe Finds Bank Robbers, Identity Thieves In Tennessee Mortgage Brokerage Industry

In Nashville, Tennessee, WTVF-TV Channel 5 reports:
  • You trust them with personal information and to help you buy your home. Yet, an exclusive NewsChannel5 investigation found bank robbers and identity thieves working in the mortgage business. Incredibly, they all received a license from the state.


  • For years the state allowed convicted felons to enter a profession that gave them access to personal information and opened the door to mortgage fraud. Take convicted bank robber Charlton Hildreth. In 2001, he walked into a bank wearing a wig, claiming to have a bomb. After prison, he applied for a mortgage license from the state and was accepted.

  • The state licensed Toran Hampton while he was on probation for bank fraud. Hampton's criminal record is pages long. But his biggest crime involved obtaining private bank account numbers and stealing thousands of dollars.


  • Surprisingly, state regulators say during the height of the sub-prime lending crisis there was nothing to keep bank robbers or anyone else from getting a license.(1) [...] A recent Miami Herald Investigation found more than 10,000 convicted criminals in the mortgage industry in Florida. Authorities in Wisconsin confirm hundreds of convicts working there. We may never know how many felons are still working in Tennessee because state officials won't release basic information about who they've licensed.

For the story, see Convicted Felons Approved As Licensed Mortgage Brokers.

(1) A new federal law now requires the state to review the criminal background of loan officers and revoke their license if they were convicted of a financial felony, according to the story.