Why Beau Biden Had to File Suit Against MERS and the Crooks Behind MERS…
…Because the Feds and state attorneys-general drafting this deal have come up with terms so pitifully weak that these negotiators make Nevil Chamberlain look like Scott Boras by comparison. That’s why.
Kafka couldn’t have concocted the scenario that led to this. Millions upon millions of families foreclosed upon, and not even knowing who ‘owned’ their homes. No deed records to provide even the slightest bit of information to go on. The single biggest financial scandal in our nation’s history with an incalculable human toll. Deliberately engineered by the most gluttonous financial institutions imaginable.
Gretchen Morgenson of the New York Times spills the beans on the paltry proposed sanctions(you may need a subscription to read this):
Cutting to the chase: if you thought this was the deal that would hold banks accountable for filing phony documents in courts, foreclosing without showing they had the legal right to do so and generally running roughshod over anyone who opposed them, you are likely to be disappointed.
Which is why Beau Biden, along with attorneys-general from New York, Massachusetts, and Nevada, abandoned the proposed settlement to seek justice in their own jurisdictions. They were concerned about the settlement:
It looks as if they were right to worry. As things stand, the settlement, said to total about $25 billion, would cost banks very little in actual cash — $3.5 billion to $5 billion. A dozen or so financial companies would contribute that money…
The banks contend that they have seen no evidence that they evicted homeowners who were paying their mortgages. Then again, state and federal officials conducted few, if any, in-depth investigations before sitting down to cut a deal.
Of course the banks don’t have any evidence because MERS was concocted by the banks to try to make sure that there was no evidence. Yet here we have the Wall Streeters who comprise Obama’s economic team and a bunch of co-opted and/or over-their heads AG’s rushing to settle this without any of the real facts.
How stupid is it to cut a deal before you even know the extent of the fraud? Don’t bother to answer, it’s a rhetorical question. Oh, and just look at the generous relief being offered to the victims:
One of the oddest terms is that the banks would give $1,500 to any borrower who lost his or her home to foreclosure since September 2008. For people whose foreclosures were done properly, this would be a windfall. For those wrongfully evicted, it would be pathetic. Roughly $1.5 billion in cash is expected to go into this pot.
Got that? If you were truly delinquent, you get $1500 you don’t deserve. If you were a victim, you get $1500 which won’t do you any good in getting your home back. And that’s assuming that the banks or whomever have a really good program for tracking down people living out of their cars somewhere. That’s because nobody has any clue as to who was foreclosed upon either fairly or unfairly. The United States of America in the 21st Century, ladies and gentlemen.
I could quote this entire article as the rest of it is all every bit as outrageous. Suffice it to say that this article (read it, subscriptions are free for up to 20 articles a month) demonstrates why OWS Wall Street is essential. If you are immune to the cynical putting-lipstick-on-a-voracious-pig, then luxuriate in your Greenville Chateau, shovel down some foie gras, wash it down with some Sauternes, and retire to your vomitorium.
If you’re as outraged as I think you should be, let your elected officials know that they can’t countenance this behavior with impunity (I’m talking about you, Jack Markell, Tom Carper, John Carney, Chris Coons…). And thank Beau Biden for having the sheer human decency to do what’s right. Which, come to think of it, shouldn’t be too much to ask of a public official. He’s doing his job. In so doing, he demonstrates why officials like Biden are essential to the success of the OWS movement. Both need and deserve our support. And neither can succeed without the other. Or without us, for that matter.
I think that Kamala Harris in CA has also rejected the settlement at least to conduct her own investigation. Not sure if she has decided to sure MERS yet. And there are counties and cities out there who are also contemplating their own lawsuits or trying to pressure their AGs to investigate at least. Montgomery Co, PA is suing for lost fees. Iowa AG Tom Miller looked like he was going to lead all of the AGs to a serious spanking of MERS, but the fact that he is trying to get a tepid settlement out of them make it look like he got got or something.
But good on Beau! This MERS thing ought to be all the evidence you need that Corporations Are Not People — can you imagine that if a single person had perpetrated the scams MERS did that they wouldn’t be in jail by now?
It indeed looks like Tom Miller ‘got got’. From Politico:
“When Obama ally Tom Miller, the Iowa attorney general, threw Schneiderman off the task force that was attempting to reach a settlement with big banks on their improper handling of foreclosures, newspaper editorials across the nation weighed in to back Schneiderman. Even former Sen. Al D’Amato (R-N.Y.) praised him.
Wonder what post Miller might get in a second Obama Administration. Eric Holder’s replacement? Or a nice Federal judgeship?
At least Obama and Holder are prosecuting John Edwards.
Talk about your, pardon the expression, ‘low-hanging’ fruit.
Gawd, I just crack myself up sometimes…
A thing I forgot to mention in my post is that there is a great deal of nervousness about the terms of the settlement in terms of what liability releases that MERS (and their owner banks) may get. Bloomburg has a report noting that the Iowa AG says that the rights of states and municipalities to sue is intact, but who knows. If they are giving away accountability, they may be closing off other efforts to get that.
It’s hard to believe that there wouldn’t be generous releases from liability in this deal, all the more reason to oppose it. It does injustice to the term ‘justice’.
Here’s a really good blog post about MERS:
http://www.dailykos.com/story/2011/10/28/1030963/-MERS-turning-Mortgages-into-Monopoly-Money-for-over-a-Decade?via=sidebyuserrec
Lord have MERSy.
Great post, El Som. How quickly would Green Knight Wharton have agreed to this settlement?
Edwards is pond scum, but his prosecution seems questionable:
http://www.esquire.com/blogs/politics/john-edwards-trial-dismissed-6531584
While I understand that the banks/MERS weren’t necessarily up to date on the paperwork of who was holding the mortgage; can someone please provide a link to a story that indicates where there was any sort of widespread problem with folks being evicted who were current on their mortgages and not in default?
In all the hoopla over this, I have yet to see any report that suggests people who were current on their mortgages suffered.
Thanks in advance.
Let me see if I have this request straight: If a person is behind on their mortgage, you think it’s OK for someone who doesn’t own the mortgage to foreclose on the home anyway.
Typical corporate lickspittle.
Google still works, you know. And the stories do come up there — I just checked.
Here’s a great article about the horrible ‘compromise’ that Obama is leaning towards:
http://crooksandliars.com/mike-lux/worst-deal-they-could-cut
Two questions: Is it possible that Tim Geithner could actually be a more disastrous public official than Dick Cheney?
To Jack Markell: With at least 1/4 of nationwide mortgages ‘under water’, do you still believe that we should ‘let bygones be bygones’ when it comes to the single largest criminal corporate enterprise in American history? Seriously, Governor, with your ‘1000 Photo Ops in 1000 Days’ Tour, it’d sure be great if you could find some time to answer that question.
Two problems.
One, there were a lot of trick mortgages sold, designed to get people into homes and then get over their heads, that never should have been legal in the first place.
Second, the job losses and lack of income growth due to unwise government policy have reached a level beyond the responsibility of the individual homeowner. Prior to the early 2000s it was reasonable to assume modest growth in income and home value. People figured if they had some personal economic misfortune, they could just do the right thing and sell the house.
Nobody anticipated that many, many people’s personal incomes would drop enough to make their mortgage unaffordable. And nobody anticipated the market would become a national disaster that would preclude responsibly selling the house. That is why government needs to step in.
“And nobody anticipated the market would become a national disaster that would preclude responsibly selling the house.”
Actually, quite a few of us predicted this. In fact I began to doubt my own assessment simply because the housing and land markets continued to inflate for so long. I also disagree that ARMs are trick mortgages. Guns don’t shoot people either.
@El Somn 8:01 pm: *heart*
In today’s SFChronicle: (the Delaware bank goes unnamed)
Bayview woman moves back into foreclosed home
http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/11/02/BUHP1LONA4.DTL
If there’s a ground zero for recession-induced home foreclosures in San Francisco, it’s the Bayview district.
Close to one-third of the San Francisco homes that were facing foreclosure in August are in the largely African American neighborhood.
By 2012, according to figures provided by RealtyTrac, which tracks foreclosures nationwide, more than 1,400 homes in the Bayview’s 94124 ZIP code area will have been foreclosed.
More than 100 of them are currently listed for sale on a Yahoo real estate page.
Bayview residents who say they were victims of fraudulent or excessively burdensome mortgages and now face foreclosure sought to draw attention to their situation Tuesday.
Bringing the media out in force – along with a city supervisor, members of the Service Employees International Union and a small contingent from Occupy San Francisco – was a press release announcing that one of the residents, Carolyn Craig, had “re-entered” the three-bedroom home on Quesada Street her family had lived in for 52 years before being evicted in January.
“If you ask me the question ‘Why are you doing this,’ I am here today because I’m reclaiming my home,” she said, to cheers from a crowd of about 60.
In fact, the home had been “reclaimed” a few days ago, a neighbor told me, “but we didn’t want to tell people ahead of time we were breaking in.”
Craig, who is back living in the house with her husband and two daughters, would not say what led up to the foreclosure, including details of loans the family may have taken out over the years. She said she had been defrauded by a now-bankrupt predatory lender, and that the company picking up the loan, Bayview Mortgage Capital in Coral Gables, Fla., had refused various entreaties.
“I’ve attempted to pay my mortgage, tried to modify the loan, even sued them, but they haven’t worked with me,” she said.
When I called the company, a voice mail message said the office was closed and that the mailbox was full. That might have been because supporters, at the urging of the activists, had earlier attempted to call the company demanding it rescind the foreclosure.
“You see a concentration of bad loans in the Bayview,” said Grace Martinez, an organizer with the Alliance of Californians for Community Empowerment, which helped neighborhood residents stage Tuesday’s event. “There seems to have been a concerted effort to deliberately target these neighborhoods. And nothing is being done for them.”
Neighbors I spoke to agreed. Craig’s “father built the house. How can a bank take it?” wondered Darryl Hughes, who said he has lived in the Bayview for 48 years, and knew the Craig family well.
Vivian Richardson, who lives one block up from the Craig family on Quesada Street, said she faces eviction on Dec. 31, despite attempts to negotiate with the lender, a Delaware bank. Richardson, who has become something of a neighborhood activist herself, said she’s planning to stay.
“Actually, quite a few of us predicted this. ”
Not until it became obvious. Before then, Republicans were busy congratulating themselves that the economy was growing (albeit weakly).
What they didn’t explain was that they had floated the entire consumer economy on cash stripped from home equity and were hollowing out the middle class and funnelling the money to the 1%, finally evident in 2008. But they kept the plates spinning long enough to get re-elected in 2004.
When we first started discussing this topic, I admit that I had at best a rudimentary understanding of what was going on. I knew enough to know that this was really important, but I didn’t know enough to know all of the machinations. (I know, I know.) While I still don’t, these threads have really shown just how insidious and all-encompassing this financial crime of the century is/was.
Thanks to our commenters and the articles that many have dug up, I’ve learned a lot more about this, none of it comforting.
However, knowledge is power, and I hope that you are learning just as much from this as I am. The better we understand this, the better equipped we are to push for solutions. The better equipped we are to help the Beau Bidens and Eric Schneidermans of this world to fight for those who have been victimized by the greediest institutions and individuals imaginable.
Keep it coming, guys and gals, b/c, in this case knowledge really IS power.
For most people if you have a secure job and a house with an up-to-date mortgage, you really wouldn’t know much about this topic unless you followed it closely on the blogs.
Overall the lesson for me is: The banks don’t need your deposits anymore, and don’t want to perform any real service. Why would they want your money, when they get money for free from the Fed? Depositor money is actually an annoyance, because then they have to spend money to service you. Their entire business model is now to trick you into some contractual obligation to pay them endless fees.
With free money from the Fed, I don’t see why the banks are so anxious to foreclose rather than work it out.
Not until it became obvious.
Not so. There were definitely folks who were trying to remind people that they were buying into a bubble — not a long term stable market. The number and consistency of those warning was why Alan Greenspan was routinely denying the existence of such a bubble, even though he could have helped put a stop to it. The problem with a bubble is that no one wants to put an end to the party. Which is a very big hint as to why Dodd-Frank provisions to oversee TBTF behavior are likely useless. Who takes away the punch bowl just when everyone is having a good time?
Remember to join the Banxodus!
Well, that was my point, so I guess we agree. Greenspan was the chief plate-spinner. He inflated the housing market to cover up the failure of the Bush tax cuts (which he supported) and to conceal the massive upward transfer of wealth. Not to mention Republicans like Mike Castle sitting on the House Financial Services committee. I don’t recall any Republicans calling out Bush and Greenspan for this failure during the 2004 election. They didn’t want to interrupt the asset-stripping and the upward flow of wealth to their donors.
Greenspan pulled the same stunt in the 1990s when he inexplicably failed to raise margin requirements in the face of the obvious equities bubble.
LOL, this comment got caught in moderation for no obvious reason.
I have no idea why that comment got caught in moderation.