Monday, November 29, 2010

Judge Needs to be Less Cool and Calm

This is in response to Kris Hundley’s article “Judge Cool and Calm as Default Cases Arrive” (reprinted from the St. Pete Times in Sunday’s Sun).  Maybe the good judge should be a little less cool and calm and a little more outraged at the rampant criminal fraud that currently plagues the foreclosure process.  The article states how the judge’s decision is “easy” in four cases, due to the mere fact that no homeowner has challenged the lender’s foreclosure claim, and how he had granted eight such summary judgments that morning.

As a foreclosure defense attorney, I know that in today’s foreclosure crisis, faulty paperwork, often amounting to outright criminal fraud, is the rule rather than the exception.  According to reporter Matt Taibbi in his recent Rolling Stone article (briefly referenced in the Times piece), almost no bank in the vast majority of pending foreclosures has a reliable record of who owns the loan.  In many cases, they have intentionally shredded the actual mortgage notes and employ “robosigners” - typically low level employees who forego legal requirements of making a dilgent search for the notes - who fraudulently have signed off on hundreds, even thousands, of false “lost note” affidavits.

But ninety percent of homeowners do not realize that they may have a valid defense in their foreclosure cases, and judges like the one in the article dutifully sanction fraud by rubber-stamping judgments likely obtained by criminal means.  This may be due to a belief that if banks were held accountable for their reckless and criminal behavior, the economy would collapse completely.  But the economy will never recover as long as banksters and corporate criminals are coddled, bailed out and spared the long prison sentences they so richly deserve.  As it stands now, they are provided with a powerful incentive to engage in even more egregious crime, and to view the resulting slap on the wrist as no more than a cost of doing business.  Under our sick system, dysfunctional in almost every respect, for the rich, crime pays.

Given the current milieu of pervasive fraud, a judge’s duty in uncontested cases is to proactively investigate each file to ferret out the probable fraud contained inside, and to forward evidence of wrongdoing to the state attorney.  Anything else is a grave abdication of judicial responsibility.


  1. A point that is alarmingly absent in these cases - a point which many of us would like some clarification upon - is that if the government has bailed out the banks (effectively having paid the banks for the unpaid mortgages) why, then, are banks repossessing these properties? The mortgages have been paid! Every Joe & Jane citizen chipped in to pay the mortgages on those unfortunate to have lost their homes to banks - whether by fraudulent banking practices or by homeowners'poor budgeting skills. So if banks have been reimbursed (by the govt) for their losses, why are banks fussing and crying (and destroying peoples' lives) to be paid AGAIN? It seems not only morally wrong, but definitely illegal! Like 2 airplanes downing 3 buildings at WTC and everyone's too tired or 'terrorized' to ask questions. Are we all asleep, or just narcotized by TV, avoiding Limbaugh whiplash?

  2. That's a good point, Sean, and one I'll have to look into. As far as I know, no foreclosure defense attorney has made this argument. Taking the legal implications to their conclusion, the banks would at least have to repay the taxpayers when and if they sell the repossessed houses (yeah, right). What I'm not sure about is whether the banks were bailed out for the foreclosure mess itself, or for other losses (which I'm sure were also due to their own criminality, greed, stupidity, or all of the above).