Some great articles by Bill Butler at Liberty Law, who knows a thing or two about securitization and foreclosure fraud, as he won one of the first (if not the first) lawsuits over securitization in 1996. Butler has been railroaded by the Minnesota federal judiciary, having been fined (and now suspended) in the neighborhood of $323,000 for presenting what the courts called “frivolous” arguments in foreclosure cases.
Of course, “frivolous” really means “bank-defeating” and so therefore the arguments couldn’t be allowed. You know, “frivolous” argument and reasoning like this:
In the example above, Wells Fargo Bank, N.A, as Trustee of the Series 2004-B Trust, claims to be the sole and exclusive owner of the securitized mortgage. If Wells is in fact the owner, it must have acquired legal title to the loan on or before February 26, 2004. New York law states that transfers to a trust after the closing date of the trust are void. N.Y. Estates, Trusts and Powers Law §§ 7-1.18, 7-2.4. Glaski v. Bank of America, N.A., 218 Cal.Rptr.4th 1079 (2013). See also, Saldivar v. JPMorgan Chase, 2013 WL 2452699 (Bky. SD Tex. 6/5/13) (holding that trustee mortgagee’s position is void if notes and assignments of mortgage not delivered within 90 day of closing of trust); Wells Fargo v. Erobobo, 2013 WL 1831799 (NY Slip Op. 4/29/13) (holding that NY trust law governs securitization and that notes and assignments of mortgage must be physically delivered to trustee within 90 days of closing for trustee to have claim of ownership). The Internal Revenue Code provides for 100 percent tax penalties for transfers to the trust after the closing date. So, if Wells Fargo cannot show physical receipt of the note and mortgage prior to February 26, 2004, its claim to the home is void. Similarly, if the only evidence Wells Fargo has of ownership is a document executed after February 26, 2004, its claim is void. Here is an example of such a document. It is an assignment of mortgage executed on May 26, 2010 (“5/26/10 AOM”) by Mary Kist in Dallas County, Texas. It is patently fraudulent. It was executed six years after the Series 2004-B trust closed. Every fraudulent securitized mortgage foreclosure has this smoking gun. There are millions of these recorded throughout the country.
According to Marie McDonnell of McDonnell Property Analytics, Mary Kist is a robo-signer. Ms. McDonnell’s thorough and pro bono analysis performed for the Essex, Massachusetts Register of Deeds is here. Mary Kist, sitting in Dallas Texas, had no factual knowledge of the contents of the 5/26/10 AOM and no legal authority to sign it. The fact that Wells Fargo had to go to Dallas, Texas to find someone to sign the 5/26/10 AOM when it is headquartered in San Francisco is powerful and dispositive evidence that it did not acquire legal title to the loan prior to February 26, 2004. These fraudulent assignments of mortgage exist in every securitized mortgage foreclosure. They are always executed years after the closing of the securitization trust and typically by someone who has no idea what they are signing. They are also always executed in a state a long distance from, and outside the subpoena power of, the state in which the foreclosed property is located.
The significance of the too late assignment of mortgage is this. Wells Fargo never acquired “legal title” to the securitized loan. This is an unfixable error. It also exposes the MBS holders to 100 percent tax penalties. Because of this, Wells Fargo, according the Erobobo, Salidivar and Glaski cases cited above, does not and cannot have “legal capacity” or legal “standing” to make a claim to the property. In short, the 5/26/10 AOM is irrefutable evidence that the Series 2004-B Trust is a “busted trust” with no identifiable owner of the mortgage.
Of course, not only was Bill Butler fined and suspended–he himself is now a victim of the very foreclosure fraud he is now barred from attempting to stop. So he figures, why not tell you what happened to him. Like me, he was fighting Fannie Mae:
Fannie Mae’s fraud differs from private securitization fraud. Although Fannie Mae is subject to the same trust rules and makes the same representations regarding physical receipt of securitized notes and mortgages prior to the “Issue Date” of the MBS, Fannie typically comes into record title after the foreclosure. In a typical Fannie case in Minnesota, an entity like Bank of America will conduct the foreclosure and then deed the property to Fannie Mae. Attached is a September 7, 2010 quit claim deed (“9/7/10 QCD”) from BAC GP, LLC to Fannie Mae relating to my home. As you can see, the “total consideration” for this transfer was “less than $500.” Jill Landeros, as “Assistant Secretary” of “BAC Home Loans Servicing, LP” executed the deed in New York. The 9/7/10 QCD claims, without any independent authority, that BAC GP, LLC is the “general partner” of BAC Home Loans Servicing, LP.
If this was done properly in accordance with the Fannie Mae Trust Indenture and Custodial Agreement above, Fannie Mae would have taken legal title to this loan in 2006 and would have in its possession the original note and fully executed assignment of mortgage dated sometime in 2006, the loan origination date and prior to the MBS Issue Date. For the same “busted trust” reasons cited above, because the 9/7/10 QCD is dated four years after last possible closing date of this securitization trust, Fannie Mae does not have legal title to this loan. Like the above example, the 9/7/10 QCD is powerful evidence that Fannie Mae never obtained legal title to this loan.
There are other nuances relating to Fannie Mae foreclosures, including the application of District of Columbia trust law and the occasional fraudulent assignment of mortgage to Fannie, but generally the above—bailout bank servicer with no right, title or interest in the loan conducts the fraudulent foreclosure and then deeds its interest to Fannie Mae—is how Fannie Mae illegitimately steals homes.
Now, most judges will downplay all of this and quite readily rule against anyone making these arguments. Even a lot of attorneys will tell you that, while all of this is true, you did borrow money and do owe it to somebody and that the best you can hope to get from arguments like these is delay in the foreclosure process and you risk really raising the ire of the court if you press on with these arguments. Fortunately, there are lots of procedural snafus that can be used against the banks that don’t have to involve the floodgates-opening truth, so a lot of times those get used against the banks with good results.
But it doesn’t unravel the whole Ponzi…