New Orleans The top court in Massachusetts has now served notice on more pervasive foreclosure fraud in Wall Street’s securitization pools. The court turned back two foreclosures as nothing more than grave dancing by US Bancorp and Wells Fargo, since they could not prove that they actually owned the title when they pulled the plug on the homeowners in 2007. Though the decision seems nails the whole securitization schemes as likely fraught with fraud, the banks and others are still obfuscating without any promise of reform.
So if US Bancorp and Wells Fargo are not to blame who is? Sit down and focus now, because anyone might lose their feet in these dizzying explanations, and I for one don’t want to be responsible, and clearly the bank are not willing to be responsible for anything at all!
- According to the Times the spokesman for US Bancorp says it’s not them, but the servicer, American Home Mortgage Servicing, the messed up. Why? They were “solely a trustee concerning a mortgage owned by a securitization trust.”
- Same for Wells Fargo according to their spokeswoman, who gilds the lily by saying, “The loans…were not originated, owned, serviced, or foreclosed upon by Wells Fargo.” They were just the trustee, so it was someone else’s fault, is their claim.
Some of this is nothing more than poppycock. I remember well meeting with representatives of Deustche Bank in New York City and elsewhere on these issues repeatedly, when they were one of the leading trustees for many mortgage securitization pools. They would complain about how little they made as trustees and describe their role as technical, almost like a name of the door with little real power or authority, but the gatekeeper for all of the investors in the pool and the holder of record. The conversations in 2007 and 2008 drove us crazy because in real estate records, the trustee’s name appears routinely as the foreclosing agent and would often be on signs in the neighborhood in places like Oakland where they were prominent. They would fuss and fume, but the bottom line was that they routinely made the offer to me that they would pull out any controversial mortgage from the pool rather than have it become an issue and when I gave them a list of properties where we had issues, they offered to identify the servicer so that we could work out a solution.
So the “trustee” might have had the short stick in this game, but contrary to the claims of their spokesfolks, they were paid to do what the court found them guilty of not doing well, and they were anything but innocent bystanders here!
The only one talking truth here seems to be one of the lawyers, Paul Collier, representing an aggrieved borrower:
“It’s been pretty clear…that the securitization industry has behaved as though it were immune from consumer protection laws, state homeowner protection laws and real estate regulations in its underwriting, securitization and foreclosure practices. I am quite confident that this is merely the first petal off the rose with regard to predatory foreclosure practices.”