Matt Taibbi blows the door off the entire Foreclosuregate scam with yet another article…..
In one case handled by Jacksonville Area Legal Aid, a homeowner refinanced her house in 2005 but almost immediately got into trouble, going into default in December of that year. Yet somehow, this woman’s loan was placed into a trust called Home Equity Loan Trust Series AE 2005-HE5 in January 2006 — five months after the deadline for that particular trust. The loan was not only late, it was already in foreclosure — which means that, by definition, whoever the investors were in AE 2005-HE5 were getting shafted.
Why does stuff like this matter? Because when the banks put these pools together, they were telling their investors that they were putting their money into tidy collections of real, performing home loans. But frequently, the loans in the trust were complete shit. Or sometimes, the banks didn’t even have all the loans they said they had. But the banks sold the securities based on these pools of mortgages as AAA-rated gold anyway.
Right. So what’s the bottom line?
In short, all of this was a scam — and that’s why so many of these mortgages lack a true paper trail. Had these transfers been done legally, the actual mortgage note and detailed information about all of these transactions would have been passed from entity to entity each time the mortgage was sold. But in actual practice, the banks were often committing securities fraud (because many of the mortgages did not match the information in the prospectuses given to investors) and tax fraud (because the way the mortgages were collected and serviced often violated the strict procedures governing such investments). Having unloaded this diseased cargo onto their unsuspecting customers, the banks had no incentive to waste money keeping “proper” documentation of all these dubious transactions.
The entire thing was and is a scam. I’ve been blowing the whistle on this for more than three years. There’s no interest in stopping it, and most people’s eyes glaze over.
But the essence of the scam is this: you were asset-stripped, your money stolen, you were sold an overinflated house, and all of it was an intentional scam.
What’s sad is that most Americans who have an opinion about the foreclosure crisis don’t give a shit about all the fraud involved. They don’t care that these mortgages wouldn’t have been available in the first place if the banks hadn’t found a way to sell oregano as weed to pension funds and insurance companies.
That’s one of the larger uglies in all of this. Not only were you ripped off but worse, the banks who did it not only robbed you once on your house, but robbed your pension fund on the back end!
There’s a cynical argument to be made that the entire purpose of TARP and all the other BS pulled by both Obama and Bush was to run the statute of limitations – that is, intentionally delay recognition of the harm until you can’t sue to recover any more.
Then there’s the attempts to block the public’s access to the courts – to observe. A right guaranteed in the Constitution.
Worse, about an hour later, April Charney, the lawyer who accompanied me to court, receives an e-mail from the judge actually threatening her with contempt for bringing a stranger to his court. Noting that “we ask that anyone other than a lawyer remain in the lobby,” Judge Soud admonishes Charney that “your unprofessional conduct and apparent authorization that the reporter could pursue a property owner immediately out of Chambers into the hallway for an interview, may very well be sited [sic] for possible contempt in the future.”
What part of The Constitution did this DOUCHE NOZZLE not bother to read?
We stand for this? Now we not only have perjury across the board and fraud up and down the line but we also have courtrooms where judges exclude the public in direct contravention of both state and federal Constitutions?
This so-called Judge needs to be imprisoned.
Why don’t the banks want us to see the paperwork on all these mortgages? Because the documents represent a death sentence for them. According to the rules of the mortgage trusts, a lender like Bank of America, which controls all the Countrywide loans, is required by law to buy back from investors every faulty loan the crooks at Countrywide ever issued. Think about what that would do to Bank of America’s bottom line the next time you wonder why they’re trying so hard to rush these loans into someone else’s hands.
The banks are insolvent. Bankrupt. Kaput. Period.
We’re beyond Banana Republic stage – this is well into the realm where the looters are now employing as many hired guns as they can find in a puerile attempt to cover their tracks and continue to cover up the original looting with more looting!
The only remaining question is why the public sits still for this obviously outrageous behavior, and when we will see the general public rise off their couches, turn off Dancing With The Stars, demand that this crap stop and the institutions involved be shut down and broken up with their executives subject to investigation, prosecution and imprisonment.