This is the largest suit of its kind for a minimum wage dispute in California. This is no laughing matter because it’s $17 million. However, I do think it’s funny, sad, and appropriate that the suit involves Realtors and minimum wage…that about sums it up for most Realtors the past few years.
When the FHFA dropped the bomb on Friday afternoon before Labor Day, it was initially met with commentary in the financial world as a nuclear bomb going off. Many figured it would implode many of the banks sued – particularly Bank of America, JP Morgan Chase and Citi…all of which seem particularly vulnerable due to the mortgage irregularities . Then we had worsening news over the weekend with regard to the financial problems in Europe. Europe crashed on Monday while Americans bar-b-qued. Everyone figured Tuesday would be a bloodbath and it looked like it was going to be, but then the market staged a rally all day long and dramatically cut it’s losses.
It turns out the FHFA is already backtracking on the extent of the law suit and there are others who are very skeptical of the relationship between our government and the banks that they figure this is just cover anyway. I don’t think anyone really thinks this suit is going anywhere. It will get settled for pennies on the dollar and despite accusations of fraud, no one will be prosecuted for criminal activity. Everything will be good. Things will go on generally as they normally have and while the taxpayers will continue to pay for these defaults and fraudulent investments, the taxpayers will remain uninformed as to what has happened.
The New York Post, while not necessarily known for hard hitting investigative research and analysis, has published a story this weekend about its findings after a 3 month investigative report on foreclosures in New York state. To their surprise, of the sample 40 foreclosures that they had looked at, 37 of them had a broken chain of title. For those who follow this stuff, you can’t sell or transfer property without having the property chain of title.
The investigation looked at foreclosures that were part of a Chapter 13 bankruptcy filing. The reason they looked at Chapter 13’s is because the bank has to prove it has rights to the property in order to make the claim on the debt. According to the New York Post, they looked at “Chapter 13 filings because the banks or mortgage servicers file proofs of claim for the debt and must, under penalty of perjury, include accurate information about the mortgage, note and fees. In New York, filing public records with “intent to deceive” is a felony.”
Despite all the coverage this past winter of robo-signing issues, issues with this practice apparently are continuing.
“The largest financial institutions in the US are doing it every day, and I have not seen it slow down or stop,” says Westchester attorney Linda Tirelli. “The game is always the same: Make up documents and foreclose as fast as you can.”
The 50 States Attorneys General along with the U.S. Department of Treasury are trying to negotiate a $25 billion deal to provide immunity for the banks so they don’t have to defend their mortgage practices and prove that they have the proper documents in order to foreclose. If approved, this will eliminate the rights of homeowners to pursue a legal option against the banks. For now, homeowners are still able to sue the banks in order to have them prove that they have the right to foreclose. In Minneapolis, one attorney who is charging ahead to help homeowners is Bill Butler.
We haven’t heard much lately about the proposed $20-$25 billion payoff where the top 5 banks will pay the 50 States Attorneys General so that the banks can continue to foreclose on homeowners without the worry of being challenged in court as to whether or not they have the proper legal paperwork.
From everything that I’ve read, if this deal gets done, homeowners will not be able to sue the banks and ask them to prove that they have the proper legal documentation in order to foreclose.
I called Minnesota’s Attorney General, Lori Swanson, and spoke with a staffer this afternoon. When I explained my concern about the proposed deal, the woman staffer assured me that Attorney General Lori Swanson has been doing a lot for homeowners and she’s on the side of homeowners. I hope so. I know it’s going to be tempting to take the deal and the money and throw homeowners rights under the bus in favor of the top 5 banks.
For those who may be facing foreclosure and wish to look at their options with regard to requiring the bank to prove their proper, legal ownership in their home, you may want to check out Bill Butler’s law firm in Minneapolis.
- Foreclosure fight brings state Attorney General to North Delridge (westseattleblog.com)
- NY AG Schneiderman charges Bank of New York with defrauding investors (americablog.com)
- Side Deal With Bank Of America Would Cede Liability In Exchange For Homeowner Relief (huffingtonpost.com)
- Foreclosure Fraud and Robo-signing (johnmurphyreports.com)
- When Is A Crime Not A Crime? (theforeclosuredetonator.wordpress.com)