In his complaint, filed in Common Pleas Court, Fox seeks at least $25,000 in compensatory damages and $25,000 in a civil penalty, plus undetermined punitive damages that his attorney said will be 2 percent of GMAC’s 2009 gross revenue.
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Now here is a good idea.
GMAC Sued by Vindictive Homeowner
And so it begins. In one of the state’s first lawsuits made by a distressed homeowner against a bank on the basis of alleged fraud during the foreclosure crisis, an Ohio man is out to get GMAC for knowingly presenting improperly-prepared paperwork in the process of his judicial foreclosure case. Yesterday, Michael Fox of Johnstown filed suit against GMAC Mortgage and Jeffrey Stephan, a bank employee who allegedly signed thousands of foreclosure affidavits without any actual knowledge of the cases therein. Stephan, who was deposed in January as part of a separate suit in Florida, admitted that during his tenure as a GMAC “robo-signer,” he signed off on around ten thousand foreclosures a month without once looking at the paperwork.
At present, several of the country’s biggest names in mortgages have frozen their in-progress foreclosures while a federal investigation of fraud in the foreclosure procedures of these lenders is being carried out. Most of these lenders have come forth and confessed that, in an attempt to cope with the unspeakable backlog of foreclosure cases jamming up the legal system in the twenty-three states that require a judicial foreclosure, they hired employees to quickly sign hundreds of thousands of foreclosure documents over the past two years. These employees never even read the court documents that they were supposed to be witnessing, many of which contained incorrect or incomplete information that couldn’t stand up to legal scrutiny. The attorneys general of all fifty states are currently working in conjunction on a joint investigation as to the full extent of this fraud and how foreclosure procedures will need to be amended so it does not happen again in the future.
Fox, whose twenty-two acre horse farm is mortgaged by GMAC, accuses the bank of having flouted the state’s Consumer Protection Sales Practices Act, in addition to having committed common law fraud and an abuse of process as well as civil conspiracy through the attempted foreclosure. In retribution, he is demanding twenty-five thousand dollars from GMAC in compensatory damages, an additional twenty-five thousand dollars in civil penalties, and what NPR described as “undetermined punitive damages that his attorney said will be 2 percent of GMAC’s 2009 gross revenue.” His suit was filed in the Common Pleas Court.
The crux of Fox’s complaint is the fact that Stephan was hired by GMAC and knowingly committed fraud by signing the paperwork without having read it, even in light of the fact that “these hundreds of affidavits would be filed in Ohio courts and relied upon by Ohio common pleas court judges in deciding whether one plaintiff in the particular case had a right to foreclose on Ohio residents.” GMAC, the suit concludes, should have been aware of that same fact and stopped committing the fraudulent acts. Stephan inked Fox’s foreclosure affidavit in January of last year.
Continue reading here…
And for a second report on this story,
Johnstown man sues GMAC Mortgage, alleges fraud in foreclosure process
NEWARK — The inevitable legal response to allegations of fraud on foreclosure documents reached Licking County on Friday with a Johnstown man’s lawsuit against GMAC Mortgage and one of its employees.
Several major lenders recently acknowledged their employees signed thousands of foreclosure documents without reading them as required by state laws. A joint investigation involving all 50 states has begun.
Michael A. Fox, 10999 Jug St., Johnstown, claims in his complaint that GMAC violated the Ohio Consumer Protection Sales Practices Act, committed common law fraud, abuse of process and civil conspiracy in seeking to foreclose on his 22-acre horse farm.
In his complaint, filed in Common Pleas Court, Fox seeks at least $25,000 in compensatory damages and $25,000 in a civil penalty, plus undetermined punitive damages that his attorney said will be 2 percent of GMAC’s 2009 gross revenue.
The complaint states that Jeffrey Stephan, who signed Fox’s foreclosure assignment Jan. 26, 2009, also testified in a Florida state foreclosure case that he signed 10,000 affidavits and assignments in a month without knowledge of the cases or verifying the accuracy of the information.
“Stephan knew or should have known that these hundreds of affidavits would be filed in Ohio courts and relied upon by Ohio common pleas court judges in deciding whether one plaintiff in the particular case had a right to foreclose on Ohio residents,” Fox states in his complaint. “GMAC knew or should have known the same.”
Check out the rest of this one here…
All I got’s to say is…
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[…] And so it Begins – GMAC, Jeffrey Stephan Sued by Vindictive Homeowner […]
* I’m not sure “sloppy paperwork” can be defined so much as shown by example. A coffee ring on a document submitted, a torn or out-of-sequence page, typos, etc. all point toward sloppy paperwork. False personal knowledge statements are not indicia of sloppyness (as those documents may be quite tidy), but rather of something “qualitatively different.”
I lost a home to GMAC, i will be looking for the documents I have in storage
Aurora did the same, so we could also file against all these clowns.
The revenge of the dead beats!!!
by the way we are not dead beats our homes, all our collective homes have been paid in full several times over
I am trying to think through the process by which the lenders will “fix” their “sloppy paperwork.”*
At the most general level – leaving aside differences in state procedures – there will be two basic models needed: the proactive fix where the lender initiates the fix, and the defensive fix, where the present or former homeowner initiates, I suppose, a motion to vacate the judgment authorizing a sheriff’s/trustee’s sale.
As I thought through the proactive fix, I realized that this is going to be very expensive for lenders, and thus am somewhat doubtful about it taking place on a large scale.
The Lenders’ PR makes it sound as if they can just send in qualifying affidavits, the courts will accept them happily, and a new amended order confirming the original judgment will issue. I don’t think this can happen. For new evidence to be put into the court file, the case will have to be re-opened, and I don’t see any way that happens without some kind of motion by the lender for amended findings, conclusions, and order (or whatever the functional equivalent in a particular jurisdiction is). Please correct me if I’m wrong, but I think the lender will have to go through these steps:
1) Determine what evidence needs fixing. In the case of “true and correct copy” statements in affidavits, can the lender find the originals to which those statement refer? If not, why not? In the cases where originals are available, they need to be collected up. In the cases where they are not, start thinking about how this is going to be “splained” to the court. Need memo of theories and likelihood of success;
2) Order title search, and do a much more detailed examination to determine who could be potentially affected in addition to the original foreclosure defendant[s]. Do former junior lien-holders (2nd mtg holders, judgment creditors, IRS, State tax dept., child support collection, mechanics’ lien holders, homeowners associations etc.) need to be made parties? (States vary a lot on this one). Has there been a post-foreclosure sale? If so, the new owner and any secured party need to be joined (in addition to any secured lender, agin, it could be the IRS, child support collection, ex spouses etc.). Determine the method of service, if necessary, on those determined to be potentially affected.
3) Avoid suicide;
4) Draft a motion and notice of motion that allows the court to re-open the file, amend its order based of the “fixed” evidence;
5) Draft a memorandum of law that justifies the re-opening and acceptance into evidence of the “proper evidence.”
6) Follow state procedural rules on motions and scheduling a hearing;
7) Pay neceesary court fees for hearing a motion;
8) Serve on all potentially affected, that is, required parties;
9) Hope like hell they all ignore it;
10) If anybody does respond/object to the motion, determine what the likelihood of success is now in being able to get the new evidence in, now that somebody, or many bodies have objected;
Note: we’re not even in front of the judge yet and I’m tired. When actually in front of the judge, I would expect the questions to be exceedingly unpleasant for the lender.
Am I right here? This is a bare-bones account, IMO, and while I’ve anticipated some of the nasty nuances, I’m sure there are others just waiting to be discovered.