On Economy, Justice, Obama Housing Plan Fell Well Short

By: Monday November 26, 2012 11:15 am

Geithner’s protestations about employing the “best feasible solutions” are really disingenuous. Unless by “feasible” he means the “solutions which hold banks the most harmless.” The truth is that Geithner wanted to protect banks and their bondholders at all costs, and that didn’t match with delivering debt relief to borrowers. Period.

 

Late Night: Interesting Timing on the DocX Founder’s Guilty Plea

By: Wednesday November 21, 2012 8:00 pm

Yesterday, Lorraine Brown, the founder of DocX/LPS was scheduled to plead guilty to conspiracy to commit mail and wire fraud at 1 PM EST. I found out about it around 2 PM from the wonderful Lynn Syzmoniac who has nagged an noodle the US Attorney’s Office about this case 4-evah (she really is the unsung hero of this development, but Lanny Bruer managed to leave her out of his self congratulatory press release).

The Lorraine Brown Case: Accountability for Fraudulent Document Preparers, Not the Banks Who Requested the Documents

By: Tuesday November 20, 2012 3:35 pm

The Justice Department has issued their formal press release in the plea arrangement with Lorraine Brown, the former President of fraudulent foreclosure document processor DocX, a division of LPS. Brown pleaded guilty to wire and mail fraud and faces five years in prison and up to $250,000 in fines, from what DoJ describes as “a six-year scheme to prepare and file more than 1 million fraudulently signed and notarized mortgage-related documents with property recorders’ offices throughout the United States.” She also acknowledged lying to the FBI and other federal regulators investigating the scheme.

Separately, the state of Missouri, which had previously indicted Brown in the same scheme, announced their own plea agreement with her on fraudulent and forged document filings in his state.

Founder of DocX/LPS Pleads Guilty in Federal Court

By: Tuesday November 20, 2012 3:15 pm

The Founder of DocX, which later changed its name to LPS, has pleaded GUILTY in US District Court for the Middle District of Florida. In the “Factual Basis” document attached to her Plea Agreement, Lorraine Borwn, the founder of DocX, LLC, admits that the documents produced by these companies from the period 2003-2009 were forgeries.

Schneiderman Files Suit Against Credit Suisse for Securities Fraud, Days After SEC Settled Same Conduct

By: Tuesday November 20, 2012 2:35 pm

Continuing on the theme of prosecutions for fraud during the housing collapse, though in this case civil rather than criminal ones, New York Attorney General Eric Schneiderman just announced a new lawsuit against Credit Suisse for defrauding investors in its mortgage backed securities business. The case mirrors the previous suit filed by Schneiderman against JPMorgan Chase over Bear Stearns’ MBS business. Curiously, both of these banks engaged in settlements just this past weekwith the SEC over precisely the same conduct, settlements where they didn’t have to admit wrongdoing.

Short Sales Continue to Dominate Consumer Relief in Foreclosure Fraud Settlement

By: Monday November 19, 2012 7:52 am

The second report from the Office of Mortgage Settlement Oversight has arrived, and it shows a continuation of one trend, tempered by the first batch of consumer relief in the form of actual principal reductions.

Yes, Banks Are Paying “Penalties” in Foreclosure Fraud Settlement With Other People’s Money

By: Thursday November 15, 2012 9:22 am

This one offers a bit of vindication. I cannot tell you how much grief I got from “official sources” over the clear reality that banks would be able to pay off their penalties in the foreclosure fraud settlement with investor money. HUD Secretary Shaun Donovan flat-out said it, and then had to backtrack and obfuscate. But it was clearly set up by the terms of the settlement. Banks would get credit under the settlement for modifying loans in private label mortgage backed securities, which means the investors take the hit.

This became more clear in Bank of America’s side deal, where they would reduce their penalty through modifying loans they don’t own.

Storm-Washing: The New Bank Ploy to Milk Foreclosure Relief PR In Storm-Wrecked Areas

By: Tuesday November 6, 2012 7:25 am

Ever since Superstorm Sandy, we’ve seen the phenomenon of storm-washing from our finance sector. That’s when banks decide to capitalize on the storm and generate some good PR by offering extended relief to homeowners in the storm’s path.

Sham Foreclosure Reviews Major Cash Cows for Foreclosure Reviewers

By: Saturday November 3, 2012 11:06 am

The sad thing here is that HUD Secretary Shaun Donovan actually highlighted the foreclosure reviews as a way for victims to get further compensation. If by “victims,” Donovan meant companies like PricewaterhouseCoopers and Promontory Financial Group, he was right.

The Banks Devise a New Deal for Homeowners: Token Relief for Liability Waivers

By: Sunday October 28, 2012 4:00 pm

The failings of the 49-state foreclosure fraud settlement have by now become so obvious that even traditional media cannot ignore it. When half of the $2.5 billion earmarked as a hard-dollar penalty to states for aid and relief for struggling homeowners just gets sucked up into filling state budget holes, you can hardly make any excuses. And the other 90% of the settlement isn’t exactly destined to flow into the hands of homeowners, either; as we know, banks will probably honor up to 1/4 of their “penalty” by doing things they already do as a routine part of their business.

There’s another potential element to this that we’re already starting to see. In relation to a resolution outside the settlement, Wells Fargo has been sending along refund checks to homeowners who overpaid for loans that the bank steered them into. Just one thing, though: the refund checks, if cashed, serve as a legal claim of liability release.

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