Fraudclosure Takes a Hit, the REMICS Have Failed

By George Mantor

Finally, in Glaski v. Bank of America, N.A., before the California Court of Appeals, the ruling that many of us have been grinding to get to for nearly five years was certified for publication. Many others better qualified than I will be writing about the details and what it means to those facing foreclosure. I will monitor that and collect the relevant material for a workshop.

Here is the essence of Glaskis successful appeal from the court Registry of Actions.

Appellant Glaski contends that the parties to the foreclosure lacked the authority to foreclose because the beneficial interest created by his deed of trust was not actually held by a party to the foreclosure process. Glaski supports this contention by alleging two separate and distinct breaks in the chain of title of that beneficial interest. The matters raised in this letter concern the alleged break in the chain resulting from the ineffective attempt to transfer Glaskis deed of trust to the securitized trust for WaMu Mortgage Pass Through Certificates Series 2005-AR17. Glaski has alleged that (i) the securitized trust was formed under New York law and (ii) the attempted transfer occurred “after the Closing Date pursuant to the PSA [Pooling and Servicing Agreement] and the requirements for a REMIC [Real Estate Mortgage Investment Conduit] Trust.”

More importantly, as I and others have argued for years, this practice applies to virtually all mortgage pools. If you are upside down on your mortgage, this would be a very good time to beat your banksta into a significant, permanent modification. Both you and they know they do not have the Note.

The Original Promissory Note and the Deed of Trust were supposed to go to the custodian for the trustee prior to the closing period of the pool. They were shredded.

Sure, they were copied; but copies don’t cut it. A Promissory Note is as negotiable as money if it is properly endorsed.

A copy is worthless…in the real world. But in the world of Wall Street, copies, and slices of copies are sold over and over again to entities that have no idea that the referenced mortgages have been, digitized and rehypothicated, and referenced as collateral in multiple pools.

This is the direct result of global monetary policy. When you print unlimited amounts of fiat money and give it to entities like Goldman Sachs and Chase all real assets are quickly bought up. The globe is out of things to do with the money and the theory was that this quantitative easing would force the creation of jobs. Instead, it led to counterfeiting on such an epic scale that the only way to measure it is with a calculator that goes to sixteen digits, something never before needed in the history of man.

Nonetheless, millions of fraudclosures were pulled off by means of photo-shopped documents.

As good news as this may be for homeowners willing to take action, the really big story is that the trustees for the pools have failed to perform their duties and have left the bondholders to now absorb huge tax penalties. Hey, NSA, contact someone over at the IRS and let them know that there are billions of taxes waiting to be collected.

Despite the media and their bloviating blogger trolls posting everywhere that deadbeat homeowners shouldn’t get a break because of a few paperwork errors, the truth is coming to light. And it is a massive crime wave in progress.

Those so called paperwork errors are actually evidence of a colossal, years in the making, global fraud. No amount of whitewash is going to make that go away.

The documents used in fraudclosures are forgeries, plain and simple. But, in creating these obvious forgeries, in their rush to foreclose on any loan they could, they created the very evidence that proves the Notes never went to the custodians of the trustee.

Remember, the loans were new loan varieties designed by Wall Street actuaries who study risk for a living. They knew what features increased the likelihood of borrowers defaulting, and those were the loans that were pushed and highly compensated for.

And those were the loans selected by John Paulson for a pool called Abacus on which he bought credit default swaps that paid him over $1 billion when within a year the loans in the pool failed exactly as they were designed to.

Wall Street kept most of the money intended for loans; set some aside to make initial payments on pools of nonexistent borrowers, bought default insurance for multiple times the collective value of the loan pools, and pocketed the rest. The defaults occurred as planned and they collected again on the insurance while receiving tax payer’s money in the ongoing bailouts. Triple rip-off.

MERS was designed to hide the fact that Wall Street was not the party with the right to the payment, hence not the creditor.

LPS created DOCX to paper over the fact that Wall Street was not the proper party to foreclose. They only got away with it a few million times…until now.

Blaming the borrowers is a smoke-screen deliberately pushed forward as a way to distract attention from the truth. The borrowers are actually insignificant and the foreclosures are nothing compared to all of the loans that never had a borrower.

When they start unwinding this, the real secret will come to light. Many of the pools are made up of fantasy loans that are either complete fiction, or duplicates of loans supposedly assigned to other pools. If hedge funds and pensions were buying, why let a lack of borrowers, even unqualified ones, slow them down?

Just buy more insurance. Look at Jon Paulson and Fabrice (Fabulous Fab) Torre, who has now been convicted.

When the REMICS fail, the great global derivatives fraud will implode on the fiction it is comprised of, and then it is anybody’s guess what happens next.

Out of the court in California come three Swans in black robes.

Will there finally be justice for millions who were nothing more than hand-picked victims of organized crime. Will judges put an end to the pervasive fraud upon the court?

Judges have seen this argument before but they simply shrug-off the fictional filings.

I recently heard this exchange between a lawyer and a Superior Court Judge.

“Judge, these documents are obvious fiction.”

“Counselor, how does that prejudice your client, they haven’t made a payment in three years?”

“I understand your honor, setting aside that they were told by Litton to stop making their payment in order to receive a loan modification under the HAMP program, these are not the people with the right to foreclose…”

“I’m going to cut you off counselor. I’ll let smarter people than I figure it out. Right now I have a ruling to make and these people are the only ones here to foreclose on this loan today.”

Glaski is headed back to Superior Court for further deliberations. Thus, while the appeal court got it right as to the pooling and servicing agreement, the case itself is not resolved.

It may however lead to more scrutiny of the assets in the pools and the tax implications could be staggering. At the very least, it puts some teeth in my argument that the vast majority of fraudclosures are intentional fraud upon the court and the whole thing is nothing more than the biggest Ponzi scheme ever. R.I.C.O. violations abound.