Quelle Surprise! San Francisco Assessor Finds Pervasive Fraud in Foreclosure Exam (and Paul Jackson Defends His Meal Tickets Yet Again) « naked capitalism

It is clear that there has been widespread abuse of mortgage recording procedures that are being ignored by everyone because no one is willing to stand up for the homeowners or to stand against the banks. It is tragic that the administration and the politicians of this country are unwilling to do the right thing. They are all turning their backs on the people every time a large dollar figure gets waved in front of their eyes as has been done with the bogus settlement with the banks and states AGs. Look at the information provide here from the New York Times and then commented on by Yves Smith of Naked Capitalism.
"So the latest report from San Francisco county should come as no surprise. From Gretchen Morgenson of the New York Times, emphasis ours:

An audit by San Francisco county officials of about 400 recent foreclosures there determined that almost all involved either legal violations or suspicious documentation, according to a report released Wednesday….
The improprieties range from the basic — a failure to warn borrowers that they were in default on their loans as required by law — to the arcane. For example, transfers of many loans in the foreclosure files were made by entities that had no right to assign them and institutions took back properties in auctions even though they had not proved ownership.

Yves here. I wish Morgenson had not deemed the latter abuses as “arcane”. They are actually pretty basic to lawyers – you can’t assign rights you don’t possess or sell what you don’t own. And these are concepts that laypeople can grasp readily. Back to the article, which makes clear the state attorney general Kamala Harris, who was doing a victory lap over the mortgage settlement, had nothing to do with this probe:
read the rest by following the link below Quelle Surprise! San Francisco Assessor Finds Pervasive Fraud in Foreclosure Exam (and Paul Jackson Defends His Meal Tickets Yet Again) « naked capitalism

Credit Slips also has another article on the same story about the abuses found in San Francisco.

Here's a bombshell: the San Francisco City Assessor commissioned a serious audit of foreclosure documentation filed in the past few years. The audit examined 400 foreclosures.  It found problems with 85% of them, often multiple problems. What's more, some of the problems are pretty serious as they implicate not only borrowers' rights, but the integrity of mortgage-backed securities and the property title system.
The San Francisco City Assessor's audit also serves as a benchmark for evaluating the Federal-State servicing settlement.  The San Francisco City Assessor managed to accomplish in a few months what the Federal government and state Attorneys General weren't able to do in nearly a year and a half with far greater resources at their disposal:  perform a credible investigation of foreclosure documentation with serious implications about the securitization process in general.  That's a lot of egg on the face of Shaun Donovan, Eric Holder, Tom Miller, et al.  The SF City Assessor report shows that it really wasn't so hard for a motivated party to undertake a serious investigation. And that raises the question of why the largest consumer fraud settlement in history proceeded with virtually no investigation.

$1.2 Trillion in Secret Additional Bailout for Banks with No Collateral and No Commitments « Livinglies's Weblog

From livinglies.wordpress.com


$1.2 Trillion in Secret Additional Bailout for Banks with No Collateral and No Commitments « Livinglies's Weblog

Of course the figure is much higher, but the secrecy surrounding the money given by the Fed to the banks is something to enrage any tea party advocate and for that matter any taxpayer. The Federal Reserve window was opened to banks who actually sold their mortgage bonds — worth nothing — to the Federal Reserve under the guise of a loan that would never be repaid. The program correctly explained in this video was one of many totaling more money than the principal on all the defaulted loans put together. The kicker is that the mortgage bonds they sold probably didn’t belong to them! (But they were acting as agents for investor/lenders whether they like to think of it that way or not.

Add to that the proceeds they received from insurance, credit default swaps, cross collateralization, overcollateralization and servicer payments (made to creditors with reports stating the loans were performing), and you have real boondoggle fueled by ideology instead of arithmetic. If the banks received more money than they loaned, then how are those loans in default? If your Aunt Tilly pays off your mortgage, your non-payment after she pays it off is not a default because there is no payment due! In this case it was Uncle Sam who paid it off and a bunch of third parties who were all making money, having sold the loans multiple times under the guise of exotic derivatives and synthetic derivatives.

SO the Banks made a ton of money in “off balance sheet” transactions which remain off balance sheet because they are hiding profits and not paying taxes. THEN they claimed losses because the money they made was “off balance sheet” and received a “bailout” they didn’t need equal to all the money that was loaned.

SEC placating? Or actually set to curb flash trading?

SEC placating? Or actually set to curb flash trading and restore trust?

wsj story on attempt by sec to get handle on flash trading, while putting in place circuit breakers that will actually prevent the likes of the flash crash seen a few months ago. 

Recently I saw that the average length of holding a stock had gone down to some ridiculous number less than 20 seconds.  If the SEC doesn't get a handle on these computerized trades the common person will stand little chance of success in the stock market.  These ridiculous swings in pricing at the blink of an eye will forever know the small investor out of the market. 

The trust of Wall Street is an inherent part of the foundation of our capitalistic system.  If we allow money managers and the like to abuse the system with little regard for the common man, the growth of our economy will be stunted.

SEC placating? Or actually set to curb flash trading and restore trust?

Currently the country is being run by the financial system.  Congress and the administration, current and past, have had plenty of opportunity to protect the interest of Main Street America.  They have failed to step up to the plate to challenge the BIG MONEY institutions and repeatedly have caved to the demands of the Too Big to Fail Banks.  

The SEC has to create a system that is not based solely on the demands of Wall Street.  We are at a cross roads in our history.  The opportunity to show the world that the US government is not bought and sold by the big money players.  There is no trust in Wall Street or our financial system in middle America. 

The SEC has ignored laws on the books regards MBS, CDO, and CDS paper when rampant fraud and abuse was present.  There chance for redemption is in front of them but the banks and bankers continue to call their bluff.