Tag Archives: wells fargo

More Mess on Securitization Foreclosures

Foreclosure_Fraud_Stop_RGBNew 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.”

Amen, brother!

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Debit Charges and Senate Hucksters

Dodd-Frank Bill

Dodd-Frank Bill

New Orleans The Dodd-Frank Financial Reform Act called for the Federal Reserve to put an end to the debit card surcharge padding when that retailers were paying to banks and credit card companies, usually amounting to 44 cents a transaction.  New Fed proposals would cap the amounts at 7 to 14 cents, about an 80% reduction.  Hooray!

But banks and card issuers are crying like babies at losing this opportunity to scam consumers on the swipe.  Visa lost 10% of its value on the market yesterday.  Bank of America and Wells Fargo record as much as 2.5% of their revenue from this scam, according to the Wall Street Journal.

I love this not only because it is a win for the biscuit cookers, but also given ACORN International’s Remittance Justice Campaign, this is another indication of what at least one authority – the United States Federal Reserve – believes is the actual cost-plus profit of such a transaction.  With enough indirect data, eventually we will understand real costs, not just predatory pricing strategies.

This is also a boost for citizen wealth, if it turns out right:

“A $100 transaction today, for example, means merchants currently pay banks as much as $1.30 in debit interchange fees, according to figures provided by the Nilson Report. Under the proposals, the merchant would pay no more than 12 cents, said David Balto, a fellow with the left-leaning Center for American Progress.”

Hey, let’s have that buck back!

Here’s the head scratcher though, thirteen (13) United States Senators wrote a letter to Fed Chair Bernacke complaining that the card companies and banks were getting stiffed.  I badly want to know who these 13 are, since their names probably comprise something that will be as close as we can come to a list of the Banking and Credit Senators or Anti-Consumer Senators, someone should come up with a better name.  I have to admit to having been foiled even after a half-hour of searching since I was only able to come up with 7 of the 13 names, so anyone who knows speak up:

  • Richard Shelby (R-AL) (Senate Banking Committee)
  • Mark Warner (D-VA) (home state of Capital One!) (Senate Banking)
  • Chris Coons (D-DE) (corporate registry state for many of these companies)
  • Tom Carper (D-DE) (see above)
  • David Vitter (R-LA)  (WTF?)
  • Judd Gregg (R-NH)
  • Evan Bayh (D-IN)  (looking for a goodbye present?)
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