Ritholtz: Why foreclosure fraud is so dangerous to property rights

[Winehole23]

Bank of America Corp said it will pay $3.6 billion to Fannie Mae to settle claims related to residential mortgage loans for the nine years to the end of 2008.

The bank also entered into agreements with Nationstar Mortgage Holdings LLC and Walter Investment Management Corp to sell about $306 billion of residential mortgage servicing rights.
The rights allow banks to earn fees from mortgage investors in exchange for collecting home loan payments from borrowers.


As part of the settlement with Fannie Mae, the bank will repurchase $6.75 billion of residential mortgage loans sold to the government agency.

http://www.reuters.com/article/2013/...9060D220130107

[Winehole23]

Surprise, Surprise: The Banks Win

By GRETCHEN MORGENSON

Published: January 5, 2013

IF you were hoping that things might be different in 2013 — you know, that bankers would be held responsible for bad behavior or that the government might actually assist troubled homeowners — you can forget it. A settlement reportedly in the works with big banks will soon end a review into foreclosure abuses, and it means more of the same: no accountability for financial ins utions and little help for borrowers.




Last week, The New York Times reported that regulators were close to settling with 14 banks whose foreclosure practices had ridden roughshod over borrowers and the rule of law. Although the deal has not been made official and its terms are as yet unknown, the initial report said borrowers who had lost their homes because of improprieties would receive a total of $3.75 billion in cash. An additional $6.25 billion would be put toward principal reduction for homeowners in distress.


The possible settlement will conclude a regulatory enforcement action brought in 2011 by the Comptroller of the Currency and the Federal Reserve. Regulators moved against 14 large home loan servicers after evidence emerged of rampant misdeeds marring the foreclosure process.


Under the enforcement action, the banks were required to review foreclosures conducted in 2009 and 2010. They hired consultants to analyze cases in which borrowers suspected that they had been injured by bank practices, such as levying excessive and improper fees or foreclosing when a borrower was undergoing a loan modification. Some 4.4 million borrowers journeyed through the foreclosure maze during the period.


Some back-of-the-envelope arithmetic on this deal is your first clue that it is another gift to the banks. It’s not clear which borrowers will receive what money, but divvying up $3.75 billion among millions of people doesn’t amount to much per person. If, say, half of the 4.4 million borrowers were subject to foreclosure abuses, they would each receive less than $2,000, on average. If 10 percent of the 4.4 million were harmed, each would get roughly $8,500.


This is a far cry from the possible penalties outlined last year by the federal regulators requiring these reviews. For instance, regulators said that if a bank had foreclosed while a borrower was making payments under a loan modification, it might have to pay $15,000 and rescind the foreclosure. And if it couldn’t be rescinded because the house had been sold, the bank could have had to pay the borrower $125,000 and any accrued equity.


Recall that the foreclosure exams came about because regulators had found pervasive problems. A study by the Fed and the comptroller’s office found “critical weaknesses in servicers’ foreclosure governance processes, foreclosure do ent preparation processes, and oversight and monitoring of third-party vendors, including foreclosure attorneys.” The United States Trustee, which oversees the nation’s bankruptcy courts, also uncovered huge flaws in bank practices.


So if you start to hear rumbling that the reviews didn’t turn up many misdeeds, you can discount it as nonsense. One could easily argue that this reported settlement was pushed by the banks so they could limit the damage they would have incurred if an aggressive review had continued.


“We think if the reviews were done right, the payouts would have been significantly higher than they appear to be under this settlement,” said Alys Cohen, staff attorney at the National Consumer Law Center. “The regulators will have abdicated their responsibility if the banks end up getting off the hook easily and cheaply.”


Let’s not forget that this looming settlement will also conclude the foreclosure reviews that were supposed to provide regulators with chapter and verse on how banks abused their customers. Stopping the reviews before they are finished means that the banks will be allowed to claim that abuses were rare and that $10 billion is an adequate penalty.

http://www.nytimes.com/2013/01/06/bu...pie.html?_r=2&

[boutons_deux]

“The regulators will have abdicated their responsibility if the banks end up getting off the hook easily and cheaply.”

they can look forward go through the swinging door into quid-pro-quo high-paid financial jobs.

[Winehole23]

self-service pays for sure

[Winehole23]

http://www.bloomberg.com/news/2013-0...shakedown.html

[boutons_deux]

The Financial War Against the Economy at Large

The weapon in this financial warfare is no larger military force. The tactic is to load economies (governments, companies and families) with debt, siphon off their income as debt service and then foreclose when debtors lack the means to pay. Indebting government gives creditors a lever to pry away land, public infrastructure and other property in the public domain. Indebting companies enables creditors to seize employee pension savings. And indebting labor means that it no longer is necessary to hire strikebreakers to attack union organizers and strikers.

Workers have become so deeply indebted on their home mortgages, credit cards and other bank debt that they fear to strike or even to complain about working conditions. Losing work means missing payments on their monthly bills, enabling banks to jack up interest rates to levels that used to be deemed usurious. So debt peonage and unemployment loom on top of the wage slavery that was the main focus of class warfare a century ago. And to cap matters, credit-card bank lobbyists have rewritten the bankruptcy laws to curtail debtor rights, and the referees appointed to adjudicate disputes brought by debtors and consumers are subject to veto from the banks and businesses that are mainly responsible for inflicting injury.


The aim of financial warfare is not merely to acquire land, natural resources and key infrastructure rents as in military warfare; it is to centralize creditor control over society. In contrast to the promise of democratic reform nurturing a middle class a century ago, we are witnessing a regression to a world of special privilege in which one must inherit wealth in order to avoid debt and job dependency.

The emerging financial oligarchy seeks to shift taxes off banks and their major customers (real estate, natural resources and monopolies) onto labor. Given the need to win voter acquiescence, this aim is best achieved by rolling back everyone’s taxes. The easiest way to do this is to shrink government spending, headed by Social Security, Medicare and Medicaid.

Financial lobbyists quickly discovered that the easiest ploy to shift the cost of social programs onto labor is to conceal new taxes as user fees, using the proceeds to cut taxes for the elite 1%. This fiscal sleight-of-hand was the aim of the 1983 Greenspan Commission.

The government’s seashore insurance program, for instance, recently incurred a $1 trillion liability to rebuild the private beaches and homes that Hurricane Sandy washed out. Why should this insurance subsidy at below-commercial rates for the wealthy minority who live in this scenic high-risk property be treated as normal spending, but not Social Security?

By not raising taxes on the wealthy or using the central bank to monetize spending on anything except bailing out the banks and subsidizing the financial sector, the government follows a pro-creditor policy. Tax favoritism for the wealthy deepens the budget deficit, forcing governments to borrow more. Paying interest on this debt diverts revenue from being spent on goods and services. This fiscal austerity shrinks markets, reducing tax revenue to the brink of default


http://truth-out.org/news/item/13718...onomy-at-large

America is so ed and so un able. But cheer up, mates, Be Happy, Don't Worry.

[Winehole23]

according to new do ents filed in state Supreme Court in Manhattan late on Friday, questionable practices by the bank’s loan servicing unit have continued well after the Countrywide acquisition; they paint a picture of a bank that continued to put its own interests ahead of investors as it modified troubled mortgages.

The do ents were submitted by three Federal Home Loan Banks, in Boston, Chicago and Indianapolis, and Triaxx, an investment vehicle that bought mortgage securities. They contend that a proposed $8.5 billion settlement that Bank of America struck in 2011 to resolve claims over Countrywide’s mortgage abuses is far too low and shortchanges thousands of ordinary investors.


The filing raises new questions about whether a judge will approve the settlement. If it is denied, the bank would face steeper legal obligations.

http://www.nytimes.com/2013/02/04/bu...ment.html?_r=0

[TDMVPDPOY]

fck was looking for this thread to posts in again

have u guys seen where you get arrested for 2 charges, they will charge you the first one to let you posts bail, then bam they send out a warrant for the 2nd charge arrest just to take ur bail money.....

[Winehole23]

LE is all about fees and fines, amigo . . .

[coyotes_geek]

When an outside analysis uncovered serious flaws with thousands of home loans, JPMorgan Chase executives found an easy fix.

Rather than disclosing the full extent of problems like fraudulent home appraisals and overextended borrowers, the bank adjusted the critical reviews, according to do ents filed early Tuesday in federal court in Manhattan. As a result, the mortgages, which JPMorgan bundled into complex securities, appeared healthier, making the deals more appealing to investors.

The Dexia lawsuit centers on complex securities created by JPMorgan, Bear Stearns and Washington Mutual during the housing boom. As profits soared, the Wall Street firms scrambled to pump out more investments, even as questions emerged about their quality.

With a seemingly insatiable appe e, JPMorgan scooped up mortgages from lenders with troubled records, according to the court do ents. In an internal "due diligence scorecard," JPMorgan ranked large mortgage originators, assigning Washington Mutual and American Home Mortgage the lowest grade of "poor" for their do entation, the court filings show.

The loans were quickly sold to investors. Describing the investment assembly line, an executive at Bear Stearns told employees "we are a moving company not a storage company," according to the court do ents.

As they raced to produce mortgage-backed securities, Washington Mutual and Bear Stearns also scaled back their quality controls, the do ents indicate.

In an initiative called Project Scarlett, Washington Mutual slashed its due diligence staff by 25 percent as part of an effort to bolster profit. Such steps "tore the heart out" of quality controls, according to a November 2007 e-mail from a Washington Mutual executive. Executives who pushed back endured "harassment" when they tried to "keep our discipline and controls in place," the e-mail said.

Even when flaws were flagged, JPMorgan and the other firms sometimes overlooked the warnings.

link

[boutons_deux]

Why Pete Petersen has spent $100Ms trying privatize SS. He knows Wall St will simply steal $100Bs.

[Winehole23]

When an outside analysis uncovered serious flaws with thousands of home loans, JPMorgan Chase executives found an easy fix.

Rather than disclosing the full extent of problems like fraudulent home appraisals and overextended borrowers, the bank adjusted the critical reviews, according to do ents filed early Tuesday in federal court in Manhattan. As a result, the mortgages, which JPMorgan bundled into complex securities, appeared healthier, making the deals more appealing to investors.

The Dexia lawsuit centers on complex securities created by JPMorgan, Bear Stearns and Washington Mutual during the housing boom. As profits soared, the Wall Street firms scrambled to pump out more investments, even as questions emerged about their quality.

With a seemingly insatiable appe e, JPMorgan scooped up mortgages from lenders with troubled records, according to the court do ents. In an internal "due diligence scorecard," JPMorgan ranked large mortgage originators, assigning Washington Mutual and American Home Mortgage the lowest grade of "poor" for their do entation, the court filings show.

The loans were quickly sold to investors. Describing the investment assembly line, an executive at Bear Stearns told employees "we are a moving company not a storage company," according to the court do ents.

As they raced to produce mortgage-backed securities, Washington Mutual and Bear Stearns also scaled back their quality controls, the do ents indicate.

In an initiative called Project Scarlett, Washington Mutual slashed its due diligence staff by 25 percent as part of an effort to bolster profit. Such steps "tore the heart out" of quality controls, according to a November 2007 e-mail from a Washington Mutual executive. Executives who pushed back endured "harassment" when they tried to "keep our discipline and controls in place," the e-mail said.

Even when flaws were flagged, JPMorgan and the other firms sometimes overlooked the warnings.

financial intermediaries preying on their clients? tends to undermine trust, but they probably figured on not being caught.

absent the Panic of 2008, they'd likely not have been.

[boutons_deux]

And how the 0.01% benefit from the Banksters Great Depression of their own making0

The Ugly Truth About America's Housing "Recovery" -- It's Wall St. Buying Homes to Rent Back to Their Former Owners

In Georgia, home prices are up 5 percent over last year, a year in which we also had one of the highest foreclosure rates in the country. Seems a little odd, doesn’t it? Don't foreclosures usually drive down the market?

That’s because the housing “recovery,” as they’re calling it, is fueled almost entirely by Wall Street private equity firms, hedge funds and the Fed's unwavering support. After creating a massive bubble in home prices that eventually burst and caused our economy to go into a tailspin, these guys have decided to come back for more, and figured out a way to profit off their destruction -- by turning foreclosed homes into rentals and securitizing the rental income.

Many are claiming this is the “private-sector solution” for the recovery we need to get the economy going again. The argument goes that investors snapping up these homes and fixing them up does more for the community than letting the houses just sit there, blighting the neighborhoods and lowering values.

That argument might have made sense for the pilot program Fannie Mae launched last year. In that bulk auction deal, investors had to agree not to sell properties facing foreclosure for a designated period of time. Many of the homes were occupied with tenants, and vacant homes had been on the market and not sold for at least six months. Of course, that deal proved too restrictive for most Wall Street types, leading the sale in Atlanta to eventually fall through.

The Blackstone group, the biggest player in the new REO to rental market, has spent $2.5 billion in the last year purchasing 16,000 homes, a number that amounts to over $100 million per week. Property records show that many of the homes Blackstone has acquired in Fulton County over the last few months were purchased on the courthouse steps at the monthly foreclosure auction, or through short sales—when a lender agrees to accept less than the amount owed on a loan.

The vast majority of these homes are not empty, but occupied by homeowners who fell behind during the great recession.

The sale often represents the last nail in the coffin of foreclosure in Georgia, a non-judicial foreclosure state where there is very little opportunity or time to make good once a homeowner falls into default. Blackstone, operating under its subsidiary, THR Georgia, buys the homes for cash, usually at deep discounts from the principle balance owed on the mortgage. Take one of the homes it snapped up at the November auction as an example: THR purchased the Southeast Atlanta home at auction for $90,000. The principle due on the mortgage that was foreclosed upon was $219,300.

http://www.alternet.org/occupy-wall-...omes-rent-back

[boutons_deux]

Bank of America Bombs : Whistleblowers Reveal Orchestrated Coverup and Massive Borrower Harm


Borrowers who had had foreclosures that were pending or had completed foreclosure sales in 2009 and 2010 could request an investigation by independent reviewers, selected and paid for by the servicers but subject to approval by the OCC.


Some experts argued that the 2009 and 2010 time range was too narrow and excluded many borrowers who had been treated improperly. These professionals also questioned whether the investigators would operate independently and fairly.
?The OCC consent orders had been launched in an unsuccessful effort to render the ongoing 50 state attorney general/Federal negotiations moot. Critics described how these orders were regulatory theater, with Georgetown law professor Adam Levitin comparing them to promising in public to spank a child, then taking him indoors and giving him a snuggle. Leaks during the course of the reviews confirmed these concerns, revealing deep-seated conflicts, limited competence among the review firms, half-hearted efforts to reach eligible homeowners, and aggressive efforts by the banks to suppress any findings of harm.

As grim as this sounds, the conduct was worse than the leaks suggested. After extensive debriefing of Bank of America whistleblowers, we found overwhelming evidence that the bank engaged in certain abuses frequently, in some cases pervasively, in its servicing of delinquent mortgages. This is particularly important because Bank of America has been identified in previous settlements as far and away the biggest mortgage miscreant, paying over 40% of last year’s state/federal mortgage settlement among the five biggest servicers.

This settlement, as intended, was yet another significant bailout to predatory servicers. As we will demonstrate over our upcoming series of posts, conservative estimates of damages due to borrowers under the consent order who suffered improper foreclosures from Bank of America exceed $10 billion. That contrasts with the cash portion of the settlement amount for Bank of America of $1.2 billion.** The amount owing for other abusive practices would have increased this total further.

Overwhelming evidence of widespread, systematic abuses. No interviewee estimated harm as occurring in less than 30% of the files they reviewed; one put serious harm at 80%. The interviewees did not simply describe individual borrower suffering in graphic terms (as one put it, “I saw files that would make your stomach turn.”) Multiple interviewees would describe widespread, sometimes pervasive patterns of impermissible conduct.


The reviews confirm what both servicing experts and foreclosure defense attorneys have seen since the crisis: Bank of America’s servicing standards were poorly designed and thus unable to handle the deluge of troubled borrowers (suspense accounts, modifications, bankruptcy, etc.). In addition, BofA had a low level of competence in their servicing area and, as a result, the problems with their servicing was made worse. For instance, reviewers gave examples of types of behavior where Bank of America practices were clearly contrary to the law, yet the banks’ personnel confidently maintained that they were proper


OCC’s badly flawed review structure compounded by complex, chaotic, and undermanaged implementation by Promontory. By delegating so much of the review process to “independent” firms (many of whom had little or no experience with servicing and foreclosure), the OCC doubled down on the same incompetence and poor standards that Bank of America and the other servicers already had in their servicing departments. Many of the flaws in the review process (compartmentalized reviews, conflicted supervisors, poor senior review for issues or disputes) were mirror images of the problems at the servicer. These problems were made worse by a bizarre management structure and frequent changes to test content and directives.


Concerted efforts to suppress finding of harm. The organizational design, the way the reviewers were managed, the elimination of areas of inquiry, and evidence of records tampering with Bank of America records all point to a multifacted, if not necessarily well orchestrated, program to make sure as much damaging information as possible was not considered or minimized. To give one example: state law issues were eliminated from the in G test, which covered loan modifications (see Appendix II below), reducing it over time from 2200 questions to 500.


Dubious role of Promontory. Promontory was a poor choice to perform the review. It had virtually no internal expertise in serivcing, provided little or no supervision, and, either by design or incompetence, managed to politicize the review process rather than make it independent.


Promontory’s recent accomplishments include telling MF Global’s board that it had “robust enterprise-wide risk management” five months before it failed [16] and finding only $14 million of Standard Chartered wire transfers in a money laundering investigation to be out of compliance, when the bank eventually admitted the amount was $250 billion [17]. That is no typo, that is an over four order of magnitude difference.


Why does Promontory prosper despite such implausible, indeed, embarrassing performances? It’s because financial firms are eager buyers of extreme management-flattering positions that are seldom subjected to scrutiny thanks to Promontory’s roster of former regulators. Indeed, Promontory occupies a position no firm holds in any other heavily regulated space, that of being the dominant shadow regulator. As we will demonstrate in later posts, the claims made by Promotory about the review process as to its independence and completeness are at odds with considerable evidence on the ground.


http://www.alternet.org/economy/bank...-borrower-harm


It was dubya's OCC that shutdown 19 states, including NY Spitzer whom dubya's DoJ later took down, that ask the govt to stop predatory lending.

[boutons_deux]

OCC Funding

The OCC does not receive appropriations from Congress. Instead, the OCC's operations are funded primarily by assessments on national banks and federal savings associations. National banks and federal thrifts pay for their examinations, and they pay for the OCC's processing of their corporate applications. The OCC also receives revenue from its investment income, primarily from U.S. Treasury securities.
The OCC's Objectives

The OCC's activities are predicated on four objectives that support the agency's mission to ensure a stable and compe ive national system of banks and savings associations:

• Ensure the safety and soundness of the national system of banks and savings associations.
• Foster compe ion by allowing banks to offer new products and services.
• Improve the efficiency and effectiveness of OCC supervision, including reducing regulatory burden.
• Ensure fair and equal access to financial services for all Americans.

http://www.occ.gov/about/what-we-do/...dex-about.html



So OCC is financed by financial sector, OBVIOUSLY NO CONFLICT OF INTEREST

[Winehole23]

Let the lawsuits and the fines begin. Here is the conclusion from the Senate report; more detail later after the hearing today.


“The J.P. Morgan Chase whale trades provide a startling and instructive case history of how synthetic credit derivatives have become a multi-billion source of risk within the US banking system. IE Buffett’s “weapons of mass destruction” pose a dangerous risk to the banking system. I was shocked that JP Morgan breached their risk limits on derivatives positions more than 330 times over 5 months in 2012. Get that? The most iconic name in banking hid hundreds of millions of losses, billions really, from the public, the regulators, the politicians and the shareholders over a span of 3 months. Ouch!


“They also demonstrate how inadequate derivative valuation practices enabled traders to hide substantial losses for months at a time; lax hedging practices obscured whether derivatives were being used to offset risk or take risk;
risk limit breaches were routinely disregarded; risk evolution models were manipulated to downplay risk; inadequate regulations oversight was too easily dodged or stonewalled and derivative trading and financial results were misrepresented to investors, regulators, policy makers, and the taxpaying public who, when banks lose big, may be required to finance multi-billion bailouts.”

http://www.forbes.com/sites/robertle...han-the-crime/

[boutons_deux]

http://www.forbes.com/sites/robertle...han-the-crime/

by this time, the crimes and criminals are well-known, the solutions are, in practice, non-existent

[boutons_deux]

TTP news:

"Everyone but China" Agreement Prevents Regulation of Hot Money and Speculation

For example, one of the things going on in the world economy right now is that there's all sorts of hot speculative capital or finance--bonds, derivatives, and so forth--moving out of the rich countries because the rich countries aren't doing so well and sloshing around in the emerging market in developing countries. And those countries are regulating that so that it doesn't cause asset bubbles and crises in their countries. But our treaty would make those kind of measures illegal.

The TPP requires that capital among all the trading partners in the treaty freeze flows freely and without delay in between all the trading partners. This stands in stark contrast with most of the economic evidence that's been coming out, and even the views of the IMF.

But 20�years of economic evidence shows that there's no strong relationship between opening yourself up to capital flows and economic growth and that there is a pretty strong relationship between opening up to capital flows and having banking crises,

What we're really concerned about is the movement of things like you noted, such as derivatives, currency trades, stocks and bonds, and so forth that can move in and out of a country within minutes and days.

Brazil's had an interest rate at about 10�percent since 2009. The United States interest rate's been about 2�percent. So you borrow money from the United States at 2�percent, you invest it in Brazil--say you buy the Brazilian currency at 10�percent. You make the differential in between the two interest rates. You can manufacture a derivatives trade within that and bet against the dollar and on the Brazilian real at the same time, and if you're leveraged significantly, you can make a killing for yourself. But you might also cause some real problems in the case of Brazil.

JAY: The TPP--everyone but China--is this part of the scenario, that the Trans-Pacific Partnership becomes a tool for waging currency war against China?

GALLAGHER: I'm not sure it's a tool for waging a currency war against China, but it really is going to restrict the ability of the countries to defend themselves with respect to this currency war.


http://truth-out.org/video/item/1517...nd-speculation

iow, how the US private sector is negotiating the rigging the international money game, with no participation or even knowledge by the US govt.

[Winehole23]

Goldman Sachs Group Inc suffered a defeat on Monday as the U.S. Supreme Court let stand a decision forcing it to defend against claims it misled investors about mortgage securities that lost value during the 2008 financial crisis. Without comment, the court refused to consider Goldman's appeal of a September 2012 decision by the 2nd U.S. Circuit Court of Appeals in New York. Goldman shares sank more than 2 percent.


That court let the NECA-IBEW Health & Welfare Fund, which owned some mortgage-backed certificates underwritten by Goldman, sue on behalf of investors in certificates it did not own, but which were backed by mortgages from the same lenders.
Goldman and other banks have faced thousands of lawsuits by investors seeking to recoup losses on mortgage securities.


The bank has said that letting the 2nd Circuit decision stand could cost Wall Street tens of billions of dollars.

http://www.reuters.com/article/2013/...92H0IU20130318

[Winehole23]

JPMorgan, don’t forget, is the largest derivatives dealer in the world. Trillions of dollars in such instruments sit on its and other big banks’ balance sheets. The ease with which the bank hid losses and fiddled with valuations should be a major concern to investors.


As for taxpayers, the Senate report clearly indicates that JPMorgan Chase is too big to regulate. The report found that the bank failed to provide crucial portfolio data to its regulators at the Office of the Comptroller of the Currency and that those regulators did not investigate questionable trading at the bank. The overseers accepted the bank’s assurances that nothing was amiss.


We already know that banks of JPMorgan’s size are also too big to be allowed to fail and too big to prosecute. Such banks are too big to regulate and apparently too big to manage. So how much more evidence do we need that banks like JPMorgan are simply too big a risk for taxpayers to bear?

http://www.nytimes.com/2013/03/17/bu...wr2XcwUOBueXkA

[Winehole23]

regulators asleep at the switch:

For more than five years, many homeowners who complained about mortgage industry foreclosure abuses have wondered whether anyone with a financial stake in keeping them in their home was paying attention. On Thursday, with the release of a new report from a federal watchdog, they got their answer: No.

The report, by the inspector general of the Federal Housing Finance Agency, says banks and other companies that manage more than 10 million home loans for Freddie Mac "largely failed" to alert the mortgage giant to the most serious category of homeowner complaints, despite a requirement they do so. These "escalated complaints" often include the most serious allegations of misconduct, including improper fees, misapplied mortgage payments and a frustrating cycle of lost paperwork and unreturned calls. In some instances, the mismanagement has led to a wrongful foreclosure.


"The results are shocking on a number of different levels," said Steve Linick, the FHFA inspector general, in an interview with The Huffington Post. "It is surprising that servicers were not reporting in such large numbers, that Freddie was not on top of this, and that [the FHFA] did not catch it in its exam."


Four of the largest bank servicers -- Bank of America, Wells Fargo, Citigroup and Provident -- reported no escalated cases to Freddie Mac, despite handling more than 20,000 over a 14-month period, according to the report. Freddie Mac examiners did not notice that the mortgage companies were failing to disclose the complaints, nor did the FHFA, which relied on "incomplete" Fannie Mae examinations, the report concludes. The FHFA oversees the bailed out lenders Freddie Mac and Fannie Mae.

http://www.huffingtonpost.com/2013/0...n_2919641.html

[boutons_deux]

Foreclosure Review Report Shows That the OCC Continues to Bury Wall Street’s Bodies


From the homeowner who died fighting a foreclosure based on a typo to the family evicted at gunpoint at 3am, there is no shortage of heartbreaking stories of improper evictions. But while victims of wrongful foreclosures are frequently too small to find justice, the banks perpetuating the crimes against them remain far too big to be held accountable. The most recent entry in the “banks got bailed out, we got sold out” saga is the latest report by the Government Accountability Office on the Independent Foreclosure Review.


Deception #1: Regulators obfuscated abuses by failing to provide a consistent approach.

Deception #2: Lack of transparency.

Deception #3: The OCC misled the public about how many homeowners were harmed.

Deception #4: Missing Do ents were not considered “errors.”

Deception #5: Regulators tried to find as few harmed borrowers as possible.

http://truth-out.org/news/item/15767...streets-bodies

[boutons_deux]

Here’s How the Foreclosure Reviews Could Have Been Done Much Faster and Cheaper

The OCC made the not-surprising confession in Senate hearings last week that if it had to do them all over again, it would have handled them differently.

On the assumption that the OCC is sincere in its repentance, Michael Olenick offers one way to have executed the reviews at vastly lower cost than the botched process that resulted.

However, there is no particular reason to believe that. As we and other observers said from the announcement of the Fed and OCC consent orders, the IFR was never intended to be a serious exercise. The approach of having bank-friendly consultants hired by the banks assured a compromised outcome.

Years mired in the world of foreclosure fraud leaves one aghast at the level of sheer chutzpah people exhibit. It was difficult, in this context, to believe that the OCC could sink to a new low – especially now that Julie Williams, Chief Counsel of the OCC, exited her regulatory role, through the revolving door of course, and straight to Promontory, a firm she helped enrich enormously by approving it for three large consulting projects in the Independent foreclosure review. But the OCC managed to do the impossible last week in continuing to claim that the consultants they’d approved, and who demonstrated themselves incapable of managing the foreclosure reviews, were actually up to the task.


http://www.nakedcapitalism.com/2013/...+capitalism%29

systematic theft of $100Bs, $Ts?, of Human-Americans' homes and wealth.

and MERS lives on

[boutons_deux]

Are the Banks Already Orchestrating Another Meltdown?

On Friday, the New York Times reported that banks are continuing to practice risky behavior as the economy “improves.” While the mainstream media has been quick to discuss the improving economy, not much conversation has been situated around whom exactly the economy is improving for and how millions of Americans still struggle financially. Just one example, for instance, is that 11 million renters currently pay more than 50 percent of their incomes on housing.

But Wall Street is making more investments, known as structured financial products, and escaping new financial regulations, such as the Dodd-Frank bill that did not change the structure of how loans are bundled — which, when done riskily, causes crisis.


http://www.alternet.org/economy/are-...other-meltdown

[boutons_deux]

Bank Of America Paid Foreclosure Bonuses While Lying To Homeowners


One of the nation’s largest mortgage servicers intentionally, knowingly, and routinely falsifies paperwork and lies to homeowners in order to boot them from their homes, according to bank insiders.

The latest of many civil suits over Bank of America’s handling of foreclosures and mortgage modifications has produced affidavits from six former employees alleging the bank actively and systematically deceived homeowners and sought foreclosures over modifications that would have kept borrowers in their homes. A seventh signed statement from a man who worked for one of the bank’s contractors reinforces the picture of a company-wide culture of putting profits over customers, even in defiance of facts.

The do ents, first reported by Pro Publica, are part of a lawsuit over the bank’s handling of trial loan modifications under the Home Affordable Modification Program (HAMP) created by the Obama administration. The employees, whose work for the bank ranged from loan origination to collections to reviewing internal loan databases, swear that Bank of America used a variety of internal policies to discourage loan modifications and encourage foreclosures, even
when loan do ents visible to the employees showed the bank’s rationale for foreclosing was untrue. Those policies include:

• ‘Blitzing’: According to William Wilson, the bank conducted a “blitz” twice a month, instructing case managers to deny any HAMP application more than 60 days old, including “files [in] which the homeowner had provided all required financial do ents and fully complied with the terms of a Trial Period Plan.”


• $500 bonuses for filling foreclosure quotas: According to Simone Gordon, an employee “who placed ten or more accounts into foreclosure in a given month received a $500 bonus. Bank of America also gave employees gift cards to retail stores like Target or Bed Bath and Beyond as rewards for placing accounts into foreclosure.”


• Lying to clients about do entation: Gordon’s affidavit says it was bank policy to sit on financial do ents borrowers submitted for 30 days, then label them “stale” and require the homeowner to re-apply. Bert Sheeks, the contract employee, was instructed “to find any pretext” to justify closing outstanding loan modification applications, “even in cases where we knew the borrower had, in fact, responded with complete do ents.” Erika Brown “was instructed to inform every homeowner who called in that their file was ‘under review’” even when she could see no one had looked at the do ents in question. Brown says she personally saw more than a hundred instances in which a bank official cancelled a loan modification due to “non payment” when the file showed all payments had been received on time.

The sum of the allegations is that the bank routinely falsified do ents and knowingly foreclosed on borrowers who were in full compliance with modification plans. The program, which was the biggest federal initiative intended to alleviate the foreclosure crisis, should have helped 800,000 more homeowners than it did, according to a 2012 report.

Bank of America spokespeople say the allegations are false. The company has already “spent more than $45 billion to settle claims tied to its 2008 takeover of Countrywide Financial Corp,” the Boston Globe notes, and the top-to-bottom malfeasance alleged in this suit echoes allegations from 2011 that the bank paid to settle. Bank of America is far from alone in that regard, as many of the largest banks in the country have paid to settle allegations of abusive practices such as “robosigning.”

Despite such settlements, the government has prosecuted more protesters than it has banks involved in the foreclosure crisis, and abuses have continued.

Bank of America and other large banks that were supposed to harness HAMP funds to help resolve the foreclosure crisis were instead quite effective at using the program to boost their own balance sheets. The manipulation of the program depicted in these affidavits is more evidence that direct principal reduction would be a more effective use of federal housing funds than HAMP’s attempted partnership with banks.

http://thinkprogress.org/economy/201...bonuses-lying/