It is impossible to overstate the severity of the real estate crisis in the United States which has been caused entirely by the reckless fraud of the nation’s largest banks – the Wall Street Oligarchs. We now have mortgage-fraud being openly acknowledged by the banksters, and on a scale never before seen in human history.
We have a single individual with JP Morgan (JPM) openly admitting that she and her team committed more than 18,000 acts of fraud per MONTH, while one Bank of America official admitted that she personally committed 7,000 to 8,000 acts of fraud monthly. Regular readers will recall that in a recent commentary I reported on two, separate anecdotes where the Bank of America attempted to foreclose on properties which did not even have mortgages.
In that same commentary, there was also an anecdotal report from a Florida lawyer who specializes in foreclosure proceedings, who stated that he regularly encountered (so-called) judges who were rubber-stamping these foreclosures without even looking at the documents. The lawyer also reported that one particular judge had already written her judgments (confirming foreclosure) before the foreclosure trial started.
We thus have the following chain of events, a Wall Street bank pushes a stack of 18,000 foreclosures in front of a small group of clerks (who make convenient patsies), and tells them they have to clear this many documents every month – knowing that it is impossible to process that volume and still follow mandatory legal procedures.
Stacks of these foreclosures are then pushed before judges. In the case of Florida, they are being processed by judges called out of retirement. Many of these people are likely no longer allowed to operate motor vehicles. These past-their-prime judges then rubber-stamp these fraudulent foreclosure documents, without even looking at them – effectively stealing the home from the homeowner through the coordinated fraud being committed by Wall Street banks and the U.S. government.
This is the sort of systemic horror-story which we would expect to hear coming out of some tiny, Third World country, with a ‘two-bit’ legal system – not from the Leader of the Free World. The crime-waves being confessed to by JP Morgan and Bank of America follow similar (if not worse) admissions by Ally Financial (GMAC’s mortgage subsidiary).
Naturally, the U.S. propaganda-machine isn’t reporting this mass-fraud as a crime-wave, but merely as “mistakes”. Let me make things clear. Doing something once is a “mistake”. Doing something 10 times is a pattern. Doing something 100 times is serial fraud. Doing something at least 7,000 times a month is a crime-wave. Obviously the banks themselves must have understood they were engaging in fraud.
In the case of JP Morgan, we have the largest, and one of the oldest banks in the United States. It has been processing foreclosures in the U.S. for more than a century. It clearly has an intimate, administrative understanding of how long it takes to process a foreclosure. When its largest mortgage-processing unit started reporting (month after month) a rate of productivity which was utterly impossible (while following mandatory legal procedures), it obviously should have put a stop to these mistakes at a much, much earlier time.
How much earlier? That is the unknown question. We already know that Ally Financial had already been sanctioned for such mortgage-fraud by a Florida judge as far back as 2006. But that was only the first time it was caught. With courts in many U.S. states severely clogged with enormous backlogs of foreclosures (more than 500,000 in Florida alone), we have no way of knowing how many foreclosure-judges are also rubber-stamping everything that is put before them.
Tragically, as despicable and inexcusable as this bankster crime-wave has been, these past horrors pale into insignificance when stacked-up against the future problems which have been created by Wall Street greed. A Bloomberg article begins to explore this legal nightmare.
“Defective documentation has created millions of blighted titles that will plague the nation for the next decade,” said Richard Kessler, a Sarasota, Florida attorney. Kessler conducted a study which found defects in approximately 75% of all court filings.
Let me expand upon this horror. For any and every U.S. residential property which has a mortgage that has come within reach of the large U.S. banks over (at least) the last four years, it now has a title which cannot be relied upon by any potential buyer. And as the Florida lawyer states, this is not just going to be a problem for one year, or five years, but roughly a decade (if not longer).
Readers must understand how our legal systems operate. A party which has defective title to a property (i.e. the Wall Street banks) can never pass "good title” to any buyer. From the time that defect is created, no subsequent buyer can ever own that home, legally. Should that defect be discovered – several years later – by the original owner, that owner then has several more years in which to file a claim (based upon our limitations statutes).
If the original owner can demonstrate that he was stripped of his title through one of these millions of acts of Wall Street fraud, the original owner must and will be awarded clear title to that property, without one penny of compensation to the new owner.
To be more specific, any U.S. home which has been bought / sold more than once in the last five years, and any / every home with a mortgage tied to one of these fraud-factories cannot be trusted when it comes to being able to purchase clear title.
This means that any prospective buyer of a U.S. home must do extensive research on that property before ever making an offer, especially if they are considering making a purchase in the fraud-capitals of the U.S. housing market: Florida, California, Arizona, and Nevada. In the case of any home which has been tainted by Wall Street fraud, any sane buyer will simply walk away.
For those who decide they must buy a particular home, at the very least you will have to hire a lawyer to do a detailed analysis of the title. Given how complicated these Wall Street webs of fraud are, hiring a lawyer won’t guarantee good title, but it will give you someone to sue, if your home is later taken from you (by the rightful owner).
The most-obvious warning siren applies to foreclosure sales. Previously seen as a way to get a cheap home, it now appears more like a way to buy a home with a ticking-bomb inside it. No one in the U.S. should consider purchasing a foreclosed property without conducting extensive research on its title.
Keep in mind that this foreclosure-fraud is also only one way in which title to U.S. residential property is now seriously in question. Court cases to date have only dealt with defective titles in foreclosure proceedings – in other words the defect is discovered at that point in time.
The yet-unanswered question is what about the tens of millions of other securitized mortgages which have been “sliced-and-diced” by the Wall Street banks to the point where it is unclear whether any homeowner with one of these tainted-titles is capable of passing good title to a prospective buyer? I first brought up this bigger legal-nightmare roughly a year ago, in a two-part series titled “Who Owns Foreclosed U.S. Properties?”.
In other words, even if a homeowner remains current on their payments, as long as there is an outstanding mortgage on that property, title rests with the mortgage-holder – and thus title must be conveyed from the genuine holder of that mortgage to any prospective buyer. If the bank which is servicing the mortgage does not hold full-and-clear title, and cannot locate / identify a single holder of clear title, then it becomes impossible to legally convey title of the property from one homeowner to another.
Much of this additional uncertainty can be attributed to the Wall Street creation known as “MERS”. This private company was created by Wall Street to attempt to bypass established legal procedures for financial companies to hold and transfer mortgages. The Wall Street fantasy was that any one of the Oligarchs could submit a file to MERS, claiming rightful title to a particular property, and have MERS rubber-stamp that title.
When the housing-bubble created by Wall Street imploded (and the real fun began for the Oligarchs), they expected to be able to waltz into foreclosure courts, show the judge their rubber-stamp from MERS, and then have the judge, in turn, rubber-stamp the foreclosure. This problem will last for much longer than ten years – since MERS has not yet been entirely wiped-out by court judgments finding against it.
Only after MERS and that entire registry system is abolished will the ten-year countdown (described by the Florida attorney) begin. Similarly, with respect to the millions of acts of foreclosure fraud now being admitted by Wall Street, this will be a problem for ten years only if U.S. regulators and law enforcement authorities put a total stop to such fraud immediately. If this national disgrace is allowed to persist, then that must extend the previous ten-year estimate for this catastrophe.
When I first began to refer to Wall Street banks as “fraud-factories” more than two years ago, some people found the term offensive. It has now been openly confessed by at least two of these companies that this is exactly what they are.
First they destroyed much of their own sector, through their multi-trillion dollar Ponzi-schemes based upon the housing-bubble these fraud-factories created. Now they have destroyed much of (if not most of) the U.S. residential real-estate market. Nothing but a complete national audit of the titles of all U.S. residential real estate can restore full trust to this market.
Unless / until that should occur, Wall Street has rendered much of the U.S. real estate market radioactive. And like radiation, these “toxic titles” are invisible – and can only be discovered through specialized detection. For anyone in the U.S. considering purchasing any U.S. home with an outstanding mortgage, the words “caveat emptor” have never been more applicable.
Disclosure: I hold no position in JP Morgan, Bank of America, or GMAC.