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It's one thing to read that foreclosures are "riddled with fraud." It's another to hear numbers like 84 percent. These are some seriously shocking numbers. Via Working America:

San Francisco recently carried out an audit on a number of foreclosures. Their findings were released in a report this week that shows just how rampant mortgage fraud has been. From Reuters:

The audit of almost 400 foreclosures in San Francisco found that 84 percent of them appeared to be illegal, according to the study released by the California city on Wednesday.

Similar studies around the country show comparable results. These numbers are astounding. And worse, they’ve essentially gotten away with it.

In many cases during the housing bubble that burst in 2008, original mortgages were repackaged and sold to so many investors that it is now unclear who actually holds the loans. O’Brien could only find the current owners of the mortgages he studied in 287 out of 473 cases.

In the San Francisco study, which studied properties subject to foreclosure sales between January 2009 to November 2011, 45 per cent were sold to entities improperly claiming to be the owner of the loan.

“It is not impossible that there are homeowners who are alleged to have defaulted on loans to which they never fully agreed to and, further, are being foreclosed upon by lenders that might not even own such loans,” the report stated.

This should be unimaginable. Instead it is chilling – the story of a largely unregulated financial industry gone amuck. The consequences to homeowners and their families is devastating. Of course the most chilling aspect of the whole mess is that the banks have never admitted to any wrongdoing. There have been no prosecutions. No banksters are wearing orange prison jumpsuits as a result of their role in defrauding millions of US homeowners.

But wait, wait! I'm sure you'll be reassured to know that Nancy Pelosi wrote a letter to Attorney General Eric Holder, asking him to look into possible violations of federal law.

I'm sure he'll jump right on it. Just as soon as he gets done busting people for medical marijuana...

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29 Comments
Milquetoast's picture
(!)

Obama on Bank Prosecutions: They Did Nothing Illegal, Only Found Loopholes That We Worked to Close

The Chief Executive Officer of the branch of govt in charge of law enforcement says it's all ok so there's nothing to see or worry about here so just move along now...


audit-prosecute-incarcerate

MountainMan23's picture

So .. systematically failing to register every sale with the local county clerk .. just a loophole.

And .. hiring people off the street to swear they'd reviewed all the (non-existent) documents to prove the bank had the right to foreclose .. just another of those pesky loopholes.

Yeah .. right ..


Democracy is too important to be entrusted to politicians.
Rise Up!
Protest!

ikalbertus's picture

I'm sure he'll jump all over this like a cheap suit.

Paul the Sax Guy's picture

And Gingrich and Santorum would say "Good! That's the way it should be."

*spit*


In the marketplace of ideas, too many people shop in the bargain basement.
-- Thunder BlueRose

Why, yes, I am a card-carrying member of the ACLU
http://saxman.bravepages.com

Rich H's picture

Really. Just what are we, the people of the US, supposed to do with leadership like that?

Geazer's picture

Here's $2,000. Now, go run along.....

(Bastids!)


"Trust no one, Mr. Mulder." - Well-Manicured Man

MountainMan23's picture

How in the name of whatever power you want to invoke could anyone think handing someone $2000 as a settlement for fraudulently losing their house was anything but an insult?

Who are these reptiles, and what are they doing running our government?


Democracy is too important to be entrusted to politicians.
Rise Up!
Protest!

Paul the Sax Guy's picture

Well, it's almost enough for moving expenses... that's pretty much what I got in a short sale, but it's a spit in the eye, and ... ok, it may not be criminal in the strict legal sense, though that's questionable, but it's criminal in every way that matters.

Government by spreadsheet.


In the marketplace of ideas, too many people shop in the bargain basement.
-- Thunder BlueRose

Why, yes, I am a card-carrying member of the ACLU
http://saxman.bravepages.com

fastfeat's picture

A tanked-up Uhaul and a one-way ticket to Getthefuckouttahere.


"Parachutes are allowed in checked or carry-on baggage, but may not be worn in flight."

---Southwest Airlines

Paul the Sax Guy's picture

All things considered, where I gotthefuckto has turned out pretty good... glad I didn't give up, but gonna be playing whack-a-mole with money people probably 'til I die or an EMP weapon hits ... come to think of it, maybe that'd not be such a bad thing... the records would be wiped, folks who haven't given up can start again, and people might just start talking to each other again, once they quit screaming...


In the marketplace of ideas, too many people shop in the bargain basement.
-- Thunder BlueRose

Why, yes, I am a card-carrying member of the ACLU
http://saxman.bravepages.com

This Guy's picture

Do you really think families will ever see any of that money? As soon the state governments get that money they will figure out ways to block paying any of it out.

priscianus jr's picture

What people are not getting is that the settlement is not the main act. The AGs' suits are the main act.

MountainMan23's picture

Estimates I heard early on (from Taibbi, I think) were something like 90% of mortgages originated since early last decade were lost in the MERS database, in other words, not recorded legally.

No way to prove who owns the house. So not only would any foreclosure be illegal, no sale would be either. The way I see it, if this were a just world, the current occupant would be able to stay in the house without making any further payments to any bank, since no bank could prove ownership.

Marcie Kaptur in fact has counselled her constituents to challenge any foreclosure attempt on exactly those grounds - make the bank prove they own the property.


Democracy is too important to be entrusted to politicians.
Rise Up!
Protest!

ikalbertus's picture

ever have existed, it was a scam from the get-go to make an end run around county recording procedures. You pay the bank, but MERS holds the deed. Every lending organization had at least one officer deputized by MERS as a vice-president or secretary working for MERS who could file a transfer or foreclosure. We're supposed to believe that a bunch of crooks hell-bent on making a killing are going to make sure that the tranfers are duly recorded.

priscianus jr's picture

Anyone who actually understands what MERS is and how they operate would not be surprised at the degree of fraudulence estimated. Schneiderman is completely on to MERS. Read the recently filed summons and complaint.
http://www.nakedcapitalism.com/2012/02/schnei...

MedfordTim's picture

All we have to do is SAY we own a house and PRESTO!

Done and done, homeowner!

Geronimo.'s picture

What the fuck is going on in this country?


"Great minds discuss ideas; average minds discuss events; small minds discuss people." ~ Eleanor Roosevelt

Paul the Sax Guy's picture

Anyone but you that'd ask that question, I'd say hasn't been paying attention...

*grin*


In the marketplace of ideas, too many people shop in the bargain basement.
-- Thunder BlueRose

Why, yes, I am a card-carrying member of the ACLU
http://saxman.bravepages.com

Milquetoast's picture

..."occupied" by the mili-tagro-pharm-banky-industrial complex.

(basically a fascist takeover)


audit-prosecute-incarcerate

Ape-Man's picture

If this is true, i think they should put the bankers in prison, and award the homes to the buyers!

Let the reich wing call for impeachments. Reparations must be made, and the guilty must be punished so that this never happens again.


"Government by organized money is just as dangerous as Government by organized mob"
-= Franklin Delano Roosevelt =-

Steve E's picture

Obama our President will take care of everything because I heard him say "no one is above the law", way back when we were looking forward not back. Anyway Pelosi apparently has everything on the table this time.

Paul the Sax Guy's picture

Stacked up table... shit keeps falling off...


In the marketplace of ideas, too many people shop in the bargain basement.
-- Thunder BlueRose

Why, yes, I am a card-carrying member of the ACLU
http://saxman.bravepages.com

. . . to do what the Department of Justice and 50 Attorneys' General offices didn't do in over a year and a half.

Maybe it's because he tried.


Corruption favors the wealthy.

Different Anonymous's picture
.

Nancy Pelosi wrote a letter to Attorney General Eric Holder, asking him to look into possible violations of federal law.

This makes me want to cry.

Here we are. This is what it comes down to, Nancy Pelosi writing a fucking letter.

C'mon 12/21/12...

Paul the Sax Guy's picture

On that subject, next month we get to hear a lecture by a guy who's spent his life learning the oral teachings from the descendants... kind of like a Castaneda who's actually learned from a don Juan, and not wrapped his own newage yuppie crap in a pseudo-scholarly package...

Should be interesting... my personal take is that something's going to change... it has to... otherwise all the stupidity, and the rage of folks that found out they're stupid and are pissed off about it, and the polarization of every aspect of life will only get worse, and darker... Old Faithful's gotta let the pressure off every so often, or that kettle's gonna go boom...

Now what changes? Dunno... don't think it's a SciFi Network Original Production (usually crap), a horror story or just the End of Days.... who the hell knows?

But, dammit.... it can't continue to go on the way it's been, and the shit rolling downhill's really gaining some momentum, y'know?


In the marketplace of ideas, too many people shop in the bargain basement.
-- Thunder BlueRose

Why, yes, I am a card-carrying member of the ACLU
http://saxman.bravepages.com

politicky's picture

84% 84% 84%....the loop running through my brain...

dang, I didn't think I could still be stunned by the criminals in the housing markets..

Mighty Vastardikai's picture

I think two words should be slamming the courts to solve this crisis: Adverse Possession.

mediawest's picture

remember this bs, when harris our newly minted states attorney. she is being groomed for senate or some other high politcal gig.... NOT ONE bankster has done a perp walk here in calif. or ny. not one... the coup d'état is real.
and those robo signed fraudulent foreclosures make the whole criminal empire complete..............


"what ever it is, I'm against it. & even if you change it or condense it, I'm against it!".... marx

ricky's picture

In what percent of the foreclosures audited were the proceedings initiated against homeowners who were current in their payments based on the terms
they agreed to when closing on the mortgages for the homes?

I have zero sympathy for banks acting illegally in the foreclosure process.
But those of you who think the economic problems related to the collapse of the housing bubble will be made anything but worse by wholesale criminal prosecutions are as stupid as the banksters who helped create this mess to begin with.


TFR