... Herein of the Responses in Florida and in Other States to Foreclosure Fraud Business Practices, continuing analysis begun here on September 29, 2011 and on October 6, 2011. See in addition the post here on October 4, 2011.
A central fact in Foreclosure Fraud business practices is that Homeowner Defendants do not have legal representation for the most part. To put it another way, Foreclosure Defendants do not usually have lawyers. That fact must be kept firmly in mind or nothing understandable can come of this story.
Florida's judicial responses include establishing a so-called "Rocket Docket" in which Foreclosure Lawsuits are the only thing on the Court docket and they are disposed of quickly, or they were disposed of quickly until the Plaintiffs' Fraud Business Model began to come to light.
Retired Judges have been brought back in many Circuits in Florida to handle these specially treated cases. No other class of cases enjoys this attention in Florida.
Finally, the Supreme Court of Florida has established a State-wide Residential Mortgage Foreclosure Mediation Program, again especially for the express purpose of mediating Foreclosures in lawsuits involving homes.
It is an unsettled question in Florida whether Clerks of Courts will continue to accept fraudulent and falsely sworn Affidavits for filing. There is presently an argument over whether Florida Clerks of Court have the power to reject anything submitted for filing on a ground related to its content, as distinct from any other ground, such as a missing notarization or the wrong-sized paper perhaps. See Gary Blankenship, "Who Owns the Note? Paperwork Problems Still Plague Foreclosure Actions" p. 1, col. 4 (Florida Bar News, September 15, 2011).
In other States, for example a Register of Deeds in Massachusetts, officials have found the authority to reject fraud and false swearing in Court filings that other States including Florida only argue about. John O'Brien is the Register of Deeds for South Essex County in Massachusetts who has found the authority. He calls his office "a 'crime scene'" because of the fraudulent paperwork:
O'Brien had a forensic audit performed on 2,000 documents filed in 565 mortgage assignments on 473 "unique" mortgage cases by J.P. Morgan Chase, Wells Fargo, and Bank of America. Among the findings were that owners could be determined on only 60 percent of the properties, and particularly problematic were those that had MERS [Mortgage Electronic Registration System] paperwork or were owned by federal government-sponsored entities, such as Fannie Mae or Freddie Mac.
Of all the assignments examined, only 16 percent were valid, and another 8.7 percent were questionable. Seventy-five percent were invalid. The audit found 27 percent of the invalid assignments were fraudulent, 35 percent had been processed by robosigners, and 10 percent violated the Massachusetts Mortgage Fraud Statute.
The MERS mentioned in this quoted piece as being "particularly problematic" in its paperwork, given its corporate birth by the real estate financing industry, "has handled about 35 million mortgages, or about half of the residential market in the U.S." Id.
Some of the techniques explored by the South Essex County Register of Deeds in Massachusetts seem easily transferable to other Counties in other States and Commonwealths, and are plainly easy to duplicate. For example, his Office has made a list of clearly identified false and fraud swearers. He has ordered his Office to require an additional Affidavit from the Plaintiff when the Plaintiff's paperwork in a given Mortgage Foreclosure Case is prepared by business organizations on this list. The additional Affidavit simply requires that the Plaintiff affirm or swear that the original papers filed on its behalf in the Mortgage Foreclosure Action were correct.
There have been no takers:
O'Brien has taken the unusual step of publishing a list of known robosigners and refusing to accept any paperwork with their signatures. Instead, he returns it to the lender, along with an additional affidavit for the lender to certify [that] there is nothing wrong with the paperwork. None of the affidavits have been signed and returned, he said; rather, the lenders have executed new paperwork with other people signing the affidavits and related paperwork. O'Brien said he forwards those redone filings to the state Attorney General's Office for investigation of possible fraud.
Id. [Emphasis added.]
End of Part 2 of 3 parts.
The 22nd Annual Bad Faith Litigation Conference of the American Conference Institute is being held in 2011 in Orlando, Florida. The author will be speaking on emerging issues of Bad Faith, such as the issues frequently featured in Foreclosures. Here is a link to the American Conference Institute Website Page which features this Conference including registration. If you or someone you know would like to attend, the ACI is offering a discount to the readers of this weblog. If you would like to explore the ACI discount offer, contact:
Marc Gerstein
Delegate Coordinator
Office: 1-212-352-3220 x5432
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