Tuesday, June 26, 2012

US Court of Appeals smackdown of Ohio Mill Firm - LSR

Major Smackdown of Predator Drone Law Firm (LSR) in  

Appeal from the U. S. District Court for the Southern District of Ohio at Cincinnati.

(Download Opinion - HERE)

A major victory at the federal level reverses a bad decision originally decided in the southern district of Ohio - Cincinnati - which is coincidentaly the home & headquarters of Predator Drone & Foreclosure Mill law firm -Lerner Sampson Rothfuss (LSR)

The court held:
The single issue before us is whether the filing of foreclosure action by the law firm claiming ownership of the mortgage by its client Washington Mutual constitutes a "false, deceptive or misleading representation" under the Fair Debt Collection Practices Act {FDCPA} when the bank has not received a transfer of the ownership documents. We hold that the complaint states a valid claim and reverse the dismissal of the case.

Plaintiff alleges that the statement in the foreclosure complaint that Lerner, Sampson filed against her on behalf of Washington Mutual contained the false statement that Washington Mutual was the holder of her mortgage. District courts have decided, and we agree, that a clearly false representation of the creditor’s name may constitute a "false representation to collect or attempt to collect any debt" under Section 1692e.
Hepsen v. J.C. Christensen and Assocs., Inc., No. 8:07-CV-1935-T-EAJ, 2009 WL 3064865, at *5 (M.D. Fla. Sept. 22, 2009) (imposing liability based on a statement incorrectly identifying the name of a creditor comports with the purposes of the Act); Blarek v. Encore Receivable Mgmt., Inc., No. 06-C-0420, 2007 WL 984096, at *15 (E.D. Wis. Mar. 27, 2007) (same).
Lerner, Sampson does not dispute that the foreclosure complaint identifies Washington Mutual as the actual holder of plaintiff’s mortgage, but claims that Ohio law permits Washington Mutual to anticipate that it would become the title holder after the foreclosure action was initiated but before it becomes final. We disagree that the issue of standing in Ohio, even if resolved in Lerner, Sampson’s favor, has any bearing on whether misidentifying a creditor is materially misleading under the Fair DebtCollection Practices Act.

HUGE footnote (below) referencing outcome of pending OHIO SUPREME COURT: Federal Home Loan Mortg. Corp. v. Schwartzwald

1The Ohio Supreme Court allowed an appeal and stayed briefing in plaintiff’s state case against WASHINGTON MUTUAL, Wallace v. Washington Mutual Bank N.A. ..2011-Ohio-6556..(Dec 21, 2011)....pending resolution of Fed. Home Loan Mort. Corp. v. Schwartzwald, 194 Ohio App. 3d 644, 2011-Ohio-2681, 957 N.E.2d 790 (Ohio Ct. App.), motion to certify and appeal allowed by 129 Ohio St. 3d 1488, 2011-Ohio-5129, 954 N.E.2d 661(Ohio Oct 5,2011)(Consolidating cases and certifying a conflict in the Ohio appellate courts on the issue of whether in order to have standing as a plaintiff in a mortgage foreclosure action, a party must show that it owned the note and the mortgage when the complaint was filed.). Should the Ohio courts decide that a potential mortgagee may anticipate transfer of the note and mortgage and bring valid foreclosure proceedings in advance, the district court will have to decide the impact of such a holding on Wallace’s claim for damages under the Fair Debt Collection Practices Act. We do not agree, however, with the district courts of this Circuit that have treated the debate in Ohio over standing to bring a foreclosure action as dispositive of whether a statement was materially misleading under the Act. See, e.g., Whittiker v. Deutsche Bank Nat’l Trust Co., 605 F. Supp.Kline v. Mortg. Elec. Sec. Sys., No. 3:08cv408, 2010 WL 1133452, at *7 (S.D. Ohio Mar. 22, 2010). Certainly, should the Ohio courts decide that Washington Mutual did not have standing to bring the foreclosure action in the first place, the materiality of the false statement of ownership would be patent. However, even if Ohio holds the opposite, the Act protects the unsophisticated consumer from false statements tending to mislead or confuse—whether Washington Mutual may ultimately succeed in an Ohio court in its foreclosure action has no bearing on whether the initial false statements misled Wallace. The issue arises in the shadow of the recent subprime mortgage crises in which financial institutions are charged with encouraging reckless lending standards and rapid transfer and sale of subprime mortgages so as to profit from the mass securitization and sale of the mortgages
Slipping computer generated, shoddy and manufactured paperwork past lower court judges (old, out-of-touch, too busy) on a “fast track” to foreclosure…used to be easy! The judicial machinery spun out of control when directed by large Predator Drone Foreclosure Mills and their "Bench Warmers"(local counsel used to foreclose) seeking the revered “Green Light” rating (used by LPS Desktop Solutions). Unfortunately thousands of Ohioans lost their homes while these FRAUDclosure factories and drone filing attorneys operated openly in front of Ohio judges ...which unfortunately were asleep-at-the-wheel. (Link to report).

However, recent attention from the OCCUPY movement, highly regarded foreclosure defense attorneys and bloggers (here, here, here) have turned the spotlight on the fraudulent and criminal behavior (of the Foreclosure Mills & Servicers) The robo-signing clearly showed that documents, legally needed to initiate foreclosures, were created and falsely executed. The attention has finally started to drown out the traditional lap dog media trained in "Bank-Speak."

Predator Drone Foreclosure Mills:
The mindless and legally void factory approach used to methodically ram-rod thousands of FRAUDclosures through the judicial machinery of Ohio’s 88 county Civil Court system appears to have finally hit a BUMP. Proof: recent published decisions coming out of some of Ohio's twelve Appellate Courts show that some judges are actually waking-up from a deep legal sleep. The Appellate courts have been routinely overturning and dismissing cases which had improperly awarded Summary Judgment to pretend lenders, bogus trust & trustees, and improper plaintiff parties.

Read full deposition - with admissions - of LSR employee Shellie Hill

Wednesday, June 6, 2012

Shocking Maps of USA Housing Misery (Foreclosure)

Pictures are Worth a Thousand Words

March 2007 - USA Map of MORTGAGES 30+ days delinquent or in Foreclosure

March 2012 - USA Map of MORTGAGES 30+ days delinquent or in Foreclosure
Although distressed mortgages were said to have peaked in 2010, a majority of these delinquencies & foreclosures were isolated to just a few states. Now (March 2012) it is painfully obvious that large regions of the country are suffering according to a 38 page report * from the Federal Reserve Bank of St. Louis.
*Report by James Bullard, President & CEO, FRB-St. Louis

Picture of current recovery....courtesy of Calculated Risk Blog (HERE)

More "distress" to come as previously reported:

Drowning in Debt - Underwater Mortgages - Next Crisis



More Honest Housing Assessments:
Michael Olenick: Beware of Housing Market Cheerleading (NAR ,NAR or WSJ)

Robert Reich: Housing is the rotting core of US Recovery
The biggest continuing problem for most Americans is their homes. Purchases of new homes are down 77% from their 2005 peak ... home sales overall are still dropping and prices are still falling.....
Houses are the major assets of the middle class. Most Americans are therefore far poorer than they were six years ago. Almost one out of three homeowners with a mortgage is now “underwater”, owing more to the banks than their homes are worth on the market.
Optimists point to declining home inventories in relation to sales, but they are looking at an illusion. Those supposed inventories do not include about 5 million housing units with delinquent mortgages or those in foreclosure, which will soon be added to the pile. Nor do they include approximately 3 million housing units that stand vacant – foreclosed upon - but not yet listed for sale, or vacant homes that owners have pulled off the market because they can’t get a decent price for them.

Monday, June 4, 2012

5 Federal Agencies agree on section of Dodd-Frank Act

Memorandum of Understanding on Section 1025 of Dodd-Frank Act

Barack Obama signs the Dodd-Frank Wall Street Reform and Consumer Protection Act alongside members of Congress in 2010

1) Consumer Financial Protection Bureau (CFPB) and the prudential regulators;
2) The Board of Governors of the Federal Reserve System,
3) Federal Deposit Insurance Corporation (FDIC)
4) National Credit Union Administration (NCUA), and the
5) Office of the Comptroller of the Currency (OCC)

The federal supervisory agencies today released a Memorandum of Understanding (MOU) that clarifies how the agencies will coordinate their supervisory activities, consistent with {Section 1025 of} the Dodd-Frank Wall Street Reform and Consumer Protection Act.

HOW: A Memorandum of Understanding (MOU) was signed seeking to coordinate important aspects of the supervision of insured depository institutions with more than $10 billion in assets (and their affiliates). Such coordination includes complex duties such as scheduling examinations, conducting simultaneous examinations of covered depository institutions (unless an institution requests separate examinations), and sharing draft reports of examination (for comment). These coordination undertakings should but will NOT lead to greater uniformity and efficiencies in supervision and help minimize regulatory burden for U.S. Tax-payers on covered depository institutions.

Read Press release from the Federal Reserve (HERE)

Matt Taibbi of Rolling Stone: How Wall Street Killed Financial Reform