As more and more facts come out, the existence of an enormous epidemic of lying and perjury by banks and their law firms in the past decade or more is becoming very clear.
Banks created mortgage securities by transferring originated mortgage loans to a trust. But they violated most state fraud laws by not recording assignments of the transfer of the loans. Hence under state law, the trust did not legally own the loan. When trouble arose, the same bank - now under the guise of the servicer of the trust - proceeded to lie to courts or in filings by saying the trust did own the mortgage loan and had the rights to foreclose. They were simply making it up - no one checked the loan papers to see that the trust in fact did own the loan. Those statements were made under oath subject to perjury laws.
Often law firms hired by the banks did that last step. The bank management did not care about accuracy - they simply send the work to the low bidder, which might even have been a legal boiler room.
How many of these defective mortgage loans exist? My guess is millions.
I personally know a several cases of this happening in both residential and commercial mortgage loans. This travesty is not simple speculation or anti-capitalist rant.
Land records of millions of homes is now under a cloud.
Think about this: you eventually pay off the mortgage loan. The servicer signs a release of lien which needs to be recorded. But what happens when the entity signing that release is not in the chain of ownership back to the original lien recorded. I wonder if the county will reject the recording? What about a new title insurer when you try to sell the property? The title search will show a lien from some entity that has never been properly extinguished. This problem could arise 10 or 20 years from now.
What happens if the original company - perhaps a special purpose subsidiary of the bank - now longer exists? Perhaps it was closed when the mortgage origination business soured in 2008-9. Now what? No corrective papers can ever be filed. This is no wild speculation.
Today's FT online" The Attorney General of Massachusetts has filed suit against five major banks "accusing them of “corrupting” the state’s land records through pervasive use of fraudulent documentation in seizing borrowers’ homes." Further, "[Ms] Coakley seems to believe what only a few of us have said publicly: robosigning was often only a symptom of failure to properly assign and endorse mortgages from originators to the trusts,” said Mr Rosner, in reference to home loans bundled into securities."
What is to be done?
The only solution is a massive class action that would require the banks to stand behind the title to all the real estate involved in these mortgage loans, and to commence action to repair the title to every single property affected. With massive penalties for noncompliance. And to take it out of bank top management pay. After all, top management is ultimately responsible.
Word of the Day
"Spoliation" - noun [$10] an old one from the file
Spoliation means 1. the act of plundering; 2. the act of injuring beyond reclaim.
Sentence: The spoliation by the major banks of the entire land ownership system in America is a colossal fraud that needs severe punishmant on the banks themselves and on the top management who were captains of that fleet of financial Vikings.
Showing posts with label banks. Show all posts
Showing posts with label banks. Show all posts
Friday, December 2, 2011
Thursday, January 6, 2011
Reform IV. End the Credit Score Racket.
Credit scores. You hear ads about them all the time, how YOU are supposed to check yours and fix the errors. And Identity Theft. YOU are supposed to check for this and fix the confusion and harm it can cause you. And the financial industry tries very hard to sell you identity theft insurance. They cause pain by spreading lies and you are supposed to buy insurance from them. That's a protection racket.
Banks, landlords and all sorts of companies use this information to make decisions about YOU. Does the credit score company ask you for permission to collect this data? Nope. From where do they collect the data? Anywhere and from anyone.
You have a dispute about a bill. Maybe you never even got the bill. The vendor calls and says pay up, or they'll report the matter to a credit score company. That will hurt you whenever you apply for credit or try to rent an apartment or for all sorts of things, even buying insurance for your car, house or life.
Isn't this reminiscent of a protection racket? Pay us or we'll cause you pain.
"Identity theft": a bank loses money in a scam. They try to force YOU to work to fix THEIR mistakes or they'll spread lies about YOU.
This whole industry and practice is a racket, one of many in the financial industry to loot and pillage from the public. They're like a mafia, seeking all kinds of ways to extort money and work from YOU, while giving you ... nothing.
Identity theft. Let's analyzes this "theft". Who loses money? The banks, etc. get scammed and lose money. And do they try to collect from the perp? Nope. Instead they post lies about YOU to their partners in crime, the credit score companies. Then YOU are forced to fix the errors, or THEY make it impossible for you to get a loan. Identity theft is the banks' problem. Let them fix the errors and try to apprehend the actual thief.
Credit Score Reforms.
1. Permission. No company should be permitted to keep a data collection about YOU unless YOU give them permission. Improve the existing law that requires them to give you a report IF you ask, to a requirement that they give it to you every year regardless of your asking or not. Why should you be forced to spend your time to get your data?
2. Limit on Power. Require that no bank or insurance company make having a credit score a condition to getting a loan or an insurance policy. Ditto for renting apartments, etc. They can make loans the old fashioned way: doing their own homework.
3. Defamation. Make credit score companies responsible for ANY harm that lies they post about you cause you; strict liability should apply, plus a fine for about $500 payable to YOU for your time used to notify them of their lies. Open them up to defamation lawsuits. Require them to check whatever they post about you and force the giver to bear the risk of giving false data. This makes THEM liable for any costs of "identity theft" and would put the costs further onto the banks, vendors, etc. that post the false information about YOU.
All this would level the field. The common man and woman would no longer be terrorized by credit score agencies and threat by debt collectors. Over time, banks would stop relying on these nameless data systems and learn about their local economies and people. Small banks would have an advantage; big banks would be put at a disadvantage.
That's good. Let's end the credit score protection racket.
Word of the Day
"Deracinate" - verb, transitive [$10] literary
Deracinate means 1. tear up by the roots; 2. obliterate, expurge.
Sentence: Financial "innovation" for the past two decades has been a disaster. It has created piratical beasts - from large carnivores and small parasites; they prey on the common man and woman and create huge risks to the economy, all for their own gains. Let's deracinate all these "reforms" and go back to the old ways of the mid 1980s. The system worked better then and was much fairer.
Banks, landlords and all sorts of companies use this information to make decisions about YOU. Does the credit score company ask you for permission to collect this data? Nope. From where do they collect the data? Anywhere and from anyone.
You have a dispute about a bill. Maybe you never even got the bill. The vendor calls and says pay up, or they'll report the matter to a credit score company. That will hurt you whenever you apply for credit or try to rent an apartment or for all sorts of things, even buying insurance for your car, house or life.
Isn't this reminiscent of a protection racket? Pay us or we'll cause you pain.
"Identity theft": a bank loses money in a scam. They try to force YOU to work to fix THEIR mistakes or they'll spread lies about YOU.
This whole industry and practice is a racket, one of many in the financial industry to loot and pillage from the public. They're like a mafia, seeking all kinds of ways to extort money and work from YOU, while giving you ... nothing.
Identity theft. Let's analyzes this "theft". Who loses money? The banks, etc. get scammed and lose money. And do they try to collect from the perp? Nope. Instead they post lies about YOU to their partners in crime, the credit score companies. Then YOU are forced to fix the errors, or THEY make it impossible for you to get a loan. Identity theft is the banks' problem. Let them fix the errors and try to apprehend the actual thief.
Credit Score Reforms.
1. Permission. No company should be permitted to keep a data collection about YOU unless YOU give them permission. Improve the existing law that requires them to give you a report IF you ask, to a requirement that they give it to you every year regardless of your asking or not. Why should you be forced to spend your time to get your data?
2. Limit on Power. Require that no bank or insurance company make having a credit score a condition to getting a loan or an insurance policy. Ditto for renting apartments, etc. They can make loans the old fashioned way: doing their own homework.
3. Defamation. Make credit score companies responsible for ANY harm that lies they post about you cause you; strict liability should apply, plus a fine for about $500 payable to YOU for your time used to notify them of their lies. Open them up to defamation lawsuits. Require them to check whatever they post about you and force the giver to bear the risk of giving false data. This makes THEM liable for any costs of "identity theft" and would put the costs further onto the banks, vendors, etc. that post the false information about YOU.
All this would level the field. The common man and woman would no longer be terrorized by credit score agencies and threat by debt collectors. Over time, banks would stop relying on these nameless data systems and learn about their local economies and people. Small banks would have an advantage; big banks would be put at a disadvantage.
That's good. Let's end the credit score protection racket.
Word of the Day
"Deracinate" - verb, transitive [$10] literary
Deracinate means 1. tear up by the roots; 2. obliterate, expurge.
Sentence: Financial "innovation" for the past two decades has been a disaster. It has created piratical beasts - from large carnivores and small parasites; they prey on the common man and woman and create huge risks to the economy, all for their own gains. Let's deracinate all these "reforms" and go back to the old ways of the mid 1980s. The system worked better then and was much fairer.
Monday, January 3, 2011
Reforms for a Square Deal. I.
I'll borrow the policy label that the great President Theodore Roosevelt used to describe his policies for the common man and woman: A Square Deal. They people deserve a Square Deal from the government and the Ruling Classes. The common people are the ultimate source of national sovereignty in the US, and the ultimate reason it survives. Their national cohesion makes the US exist. They fight the wars. Today begins a series advocating simple and not so simple reforms that will help move the US towards ... what ?
What do we want ? What is our End Point ? What is our metaphorical eschaton for the US ?
We want a happier society more consistent with the Preamble of the Constitution of the US and consistent with our inalienable rights to Life, Liberty and Pursuit of Happiness. I've written elsewhere how this can be accomplished in a broad context of philosophy and also political economics. A happier society would provide near complete freedom for a great majority in the middle, a secure safety net for the poor and considerable regulations for the top - those budding aristocrats. The top pays for the safety net. Simple. I've proven that such a society would be happier [See posts of January 29 and April 9 of 2010]. Now what's the optimal path ?
Today and in coming days I will write about specific reforms that will move us there. First, a simple banking reform.
Banking Reform
There's too much vig in the system. The big banking corporations want a bigger and bigger slice of every transaction and everyone's pay checks. For what ? Nothing. The government provides deposit insurance at a non-profit basis. The Treasury prints the paper money and mints the coins. The debit card systems, the pay day lenders, the fees on bank accounts, the refusal to open accounts for the poor, the fees on every transaction: all are unfair vig the bosses want to loot from the people.
A reform: as a condition of having Federal deposit insurance, any bank or credit union must offer a transaction account for free that a person can use to deposit checks (electronically OR paper) and obtain cash or a debit card. For free, regardless of credit history (as no credit is being given). Now a person with any job can store his money safety and use it in the economic system. He can deposit a check for services rendered (whether from an employer or a friend), and get cash when the check clears. This rule would apply to small business accounts, too. And one more thing: the ability to get a bank check for minimal fee to pay for large expenditures that require checks (car purchase, etc.)
I don't have to suggest reforms for debit cards transaction fees since the Fed has already proposed new rules (after much research) to eviscerate the rapacious fees of the banks. Payday lenders could still exist ... to lend. The same for check cashing services. If they provide value or convenience, they could exist. But the poor could access the normal banking system and ... live freely without the parasites and vig paid.
Krypto Fund
My dog Krypto performed superlatively last year in her money management job. Krypto Fun made a 14.1% total return in 2010, better that most hedge funds. The S&P 500 total return was a bit over 15%; that's 100% equity, while Krypto Fund is less than 50% equity. Obviously Krypto Fund's risk reward is far superior. Good doggie ... here's your fee, a fine dog biscuit.
Word of the Day
"Gracile" - adjective [$10]
Gracile means 1. gracefully slender; 2. graceful.
Sentence: Attractiveness in ladies is not unidimensional: Audrey Hepburn was a gracile beauty; Marilyn Monroe was voluptuously gorgeous, but definitely not gracile.
What do we want ? What is our End Point ? What is our metaphorical eschaton for the US ?
We want a happier society more consistent with the Preamble of the Constitution of the US and consistent with our inalienable rights to Life, Liberty and Pursuit of Happiness. I've written elsewhere how this can be accomplished in a broad context of philosophy and also political economics. A happier society would provide near complete freedom for a great majority in the middle, a secure safety net for the poor and considerable regulations for the top - those budding aristocrats. The top pays for the safety net. Simple. I've proven that such a society would be happier [See posts of January 29 and April 9 of 2010]. Now what's the optimal path ?
Today and in coming days I will write about specific reforms that will move us there. First, a simple banking reform.
Banking Reform
There's too much vig in the system. The big banking corporations want a bigger and bigger slice of every transaction and everyone's pay checks. For what ? Nothing. The government provides deposit insurance at a non-profit basis. The Treasury prints the paper money and mints the coins. The debit card systems, the pay day lenders, the fees on bank accounts, the refusal to open accounts for the poor, the fees on every transaction: all are unfair vig the bosses want to loot from the people.
A reform: as a condition of having Federal deposit insurance, any bank or credit union must offer a transaction account for free that a person can use to deposit checks (electronically OR paper) and obtain cash or a debit card. For free, regardless of credit history (as no credit is being given). Now a person with any job can store his money safety and use it in the economic system. He can deposit a check for services rendered (whether from an employer or a friend), and get cash when the check clears. This rule would apply to small business accounts, too. And one more thing: the ability to get a bank check for minimal fee to pay for large expenditures that require checks (car purchase, etc.)
I don't have to suggest reforms for debit cards transaction fees since the Fed has already proposed new rules (after much research) to eviscerate the rapacious fees of the banks. Payday lenders could still exist ... to lend. The same for check cashing services. If they provide value or convenience, they could exist. But the poor could access the normal banking system and ... live freely without the parasites and vig paid.
Krypto Fund
My dog Krypto performed superlatively last year in her money management job. Krypto Fun made a 14.1% total return in 2010, better that most hedge funds. The S&P 500 total return was a bit over 15%; that's 100% equity, while Krypto Fund is less than 50% equity. Obviously Krypto Fund's risk reward is far superior. Good doggie ... here's your fee, a fine dog biscuit.
Word of the Day
"Gracile" - adjective [$10]
Gracile means 1. gracefully slender; 2. graceful.
Sentence: Attractiveness in ladies is not unidimensional: Audrey Hepburn was a gracile beauty; Marilyn Monroe was voluptuously gorgeous, but definitely not gracile.
Wednesday, October 13, 2010
Foreclosure Follies
How ludicrous is this whining by banks about courts requiring them to do foreclosures properly!
These banks collect billions in servicing fees, yet want to make more and more money so they cut corners and they refuse to hire more people to process the loans. They hire law firms to specialize in the foreclosure process, but all that means is the lawyers lie for them, too. Fannie Mae and Freddie Mac are among the worst offenders. All this is just outrageous. Now they go on TV and get shills to say how all this correct procedure is somehow hurting the real estate recovery.
That's more Boob Bait for the Booboise - talking points for their lackeys in the media and financial industry.
Yet making simply loan modifications and approving short sales quickly - real actions that would save them money - are not done.
In my opinion, any state that permits non-judicial foreclosures should immediately change to requiring judicial foreclosures. The financial industry has proven that it is incompetent, utterly ruthless and selfish.
Make them do it right. That's why they are being paid.
Word of the Day
"Subserve" - verb, transitive [$10]
Subserve means 1. to serve as an instrument or means of; 2. to promote the welfare or purposes of.
Sentence: Courts should be a forum of impartial justice adn correct, fair procedure; they should NOT subserve bank profits.
Banks have been caught lying on court papers and not properly serving borrowers that a foreclosure sale date is set. They lose notes and cannot prove they actually own the loan, yet they want to foreclose faster.
These banks collect billions in servicing fees, yet want to make more and more money so they cut corners and they refuse to hire more people to process the loans. They hire law firms to specialize in the foreclosure process, but all that means is the lawyers lie for them, too. Fannie Mae and Freddie Mac are among the worst offenders. All this is just outrageous. Now they go on TV and get shills to say how all this correct procedure is somehow hurting the real estate recovery.
That's more Boob Bait for the Booboise - talking points for their lackeys in the media and financial industry.
Yet making simply loan modifications and approving short sales quickly - real actions that would save them money - are not done.
In my opinion, any state that permits non-judicial foreclosures should immediately change to requiring judicial foreclosures. The financial industry has proven that it is incompetent, utterly ruthless and selfish.
Make them do it right. That's why they are being paid.
Word of the Day
"Subserve" - verb, transitive [$10]
Subserve means 1. to serve as an instrument or means of; 2. to promote the welfare or purposes of.
Sentence: Courts should be a forum of impartial justice adn correct, fair procedure; they should NOT subserve bank profits.
Wednesday, August 4, 2010
Small Business Lending
The press in the US and UK runs stories about a dearth in small business lending. I have no doubt such exists. Too many anecdotal stories add up to a problem, and where else could one find out about problems in obtaining loans from ... lots of small businesses.
Why ?
The answer is obvious. The mega banks and super regional banks are sucking all the deposits of the people to fund Wall Street trading operations. Or they fund purchases of securities. We know that Citibank, Wells Fargo, Bank of America and JP Morgan control about 40% of deposits. Do you suppose they make 40% of the small business loans ? No way. The same applies to the big regional banks.
For three decades the big fish have been eating the small fish to get bigger & bigger. Big banks have bought hundreds or thousands of small banks to get their deposits. Do they keep open small town loan offices. Nope.
The government's Small Business loan program does help ... A LOT. Recently one of my companies sold a property to its current operator. Where did he get the loan ? From a small bank via an SBA loan.
The answer to all this is so simple. Break up the big banks ... AND the super regionals. Or put a MUCH LOWER cap on their deposits, net of small business or home loans. This would force them to either forego those deposits or make loans using them.
See how easy it truly is to solve problems for the people, once one gets away of the DC racketeers and knaves.
Word of the Day
"Perihelion" - noun [$10] (plural - perihelia or perihelions) A Mencken Word
Perihelion means the point in the orbit of a planet, comet, etc. at which it is closest to the sun. (Opposite - aphelion)
Sentence: (From The Impossible H. L. Mencken, page 415) "If it has its perihelions of triumph and gloriy, it also has its nadirs of defeat and despair."
Why ?
The answer is obvious. The mega banks and super regional banks are sucking all the deposits of the people to fund Wall Street trading operations. Or they fund purchases of securities. We know that Citibank, Wells Fargo, Bank of America and JP Morgan control about 40% of deposits. Do you suppose they make 40% of the small business loans ? No way. The same applies to the big regional banks.
For three decades the big fish have been eating the small fish to get bigger & bigger. Big banks have bought hundreds or thousands of small banks to get their deposits. Do they keep open small town loan offices. Nope.
The government's Small Business loan program does help ... A LOT. Recently one of my companies sold a property to its current operator. Where did he get the loan ? From a small bank via an SBA loan.
The answer to all this is so simple. Break up the big banks ... AND the super regionals. Or put a MUCH LOWER cap on their deposits, net of small business or home loans. This would force them to either forego those deposits or make loans using them.
See how easy it truly is to solve problems for the people, once one gets away of the DC racketeers and knaves.
Word of the Day
"Perihelion" - noun [$10] (plural - perihelia or perihelions) A Mencken Word
Perihelion means the point in the orbit of a planet, comet, etc. at which it is closest to the sun. (Opposite - aphelion)
Sentence: (From The Impossible H. L. Mencken, page 415) "If it has its perihelions of triumph and gloriy, it also has its nadirs of defeat and despair."
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