Anatomy of Mortgage Fraud: MERS’s Smoking Gun, Part I. Contains some absolute gems:
MERS purportedly offers an alternative to paperwork, maintaining an electronic record of mortgages that are usually packaged into mortgage backed securities (MBSs)… MERS was created to run multiple frauds.
In foreclosure cases across the nation, the banks have been filing “lost note affidavits”, certifying that they cannot find the notes that are required to prove that they have the right to take away someone’s home…. By law, the notes are supposed to be at REMIC trustees, held against the MBSs sold on to investors — and must be presented to foreclose.
The real mystery is why these trustees cannot produce the notes… MERS’s instruction manual… demonstrate that failure to properly endorse the notes and transfer them to the REMIC trustee was not an occasional mistake, but rather was MERS’s business model… MERS planned from the get-go to defraud the counties, and the IRS, and the homeowners, and the buyers of the mortgage-backed securities.
In the document, MERS claims that its recommended procedures are “customary”. In fact, there are several hundred years of “custom” that requires endorsement of notes at the time of transfer, with a clear chain of title to ensure that anyone who claims to be a creditor, and who tries to seize someone’s home, has clear documentary proof of entitlement. What MERS proposes in this document is to break the chain of title, to eliminate the protection that debtors need to prevent mortgage servicers and MERS from illegally stealing their property through the use of robo-signers and the manufacture of fake documents. In other words, both law and custom were formulated to prevent the sort of foreclosure fraud that has become normal business practice — what the MERS document calls “customary”.
I do not know why MERS proposed illegal activity as a new custom.
Hat tip Market Ticker
I can’t in good conscience post any more of his report. If you are interested in the topic read the whole thing.
I guess that could explain why Marci Kaptur’s Anti-MERS Bill is the Target of Misleading PR by Title Insurance Industry
Rep. Marci Kaptur of Ohio has introduced a short bill, H.R. 6460, which would seriously restrict the operations of MERS by effectively removing Freddie, Fannie and Ginnie as users. The bill would bar the GSEs from guaranteeing or owning any mortgage that is either assigned to MERS or lists MERS as the mortgage of record. Note that those are the two roles typically set forth in the registrations at local courthouses which register mortgage in the name of MERS.
How much have the banks with their fraudulent practices cost Americans? Who knows, a lot of the human costs can’t really have a dollar figure put on them. Also the system is not fixed. The costs can not yet be calculated. We can not know. In fact we can never really know. But the recent Fed audit contains some eye popping numbers:
Consider this: the recent Fed audit revealed over $3.3 trillion in emergency assistance to the banks and other corporate behemoths during the financial crisis—no strings attached. Source: The Nation. Hat tip Naked Capitalism.
But it’s hard to grasp the enormity of a trillion. How many seconds is it:
One Trillion Seconds = 31,688 years, so 3.3 trillion seconds is 104, 570 years.
If you count one number every second it will take 104,570 years to get to 3.3 trillion. Homo sapiens apparently evolved around 120,000 years ago.
As I mentioned, the numbers don’t really mean anything. But 3.3 trillion is the middle number of those revealed in this report of the recent Fed disclosure:
The estimated $3.3 trillion in liquidity and more than $9 trillion in short-term loans and other financial arrangements dwarf the $700 billion Treasury Department bank bailout out signed into law under President George W. Bush.
The numbers are astounding. The report also states:
The Fed’s multi-trillion bailout was not limited to Wall Street and big banks, Some of the largest corporations in this country also received a multi-trillion bailout. Among those are General Electric, to which the Fed made over $16 trillion in financing under a commercial paper funding facility alone; McDonald’s; Verizon; and Toyota.
We have posted before on the foreign component in No losses by government decree.
Honesty, trust and the rule of law are components of our economic system. Their existence is part of the reason we have been able to generate so much wealth. Without them we will be poorer. We will be impoverished. No one has a right to be affluent. Money has to be earned. This is true for the individual as well as society.
Money might appear to grow on trees, or be simply be electronic blips in computers. But ultimately this is not real wealth. It can’t be. Absent trust its value will prove to be ephemeral. The US and the Western world are playing with fire. And in this instance Prometheus will not suffer alone.