Fannie, Freddie, Big Banks Helping Lawyers Make Millions Pushing Families Out Of Their Homes

Mother Jones:

Late one night in February 2009, Ariane Ice sat poring over records on the website of Florida's Palm Beach County. She'd been at it for weeks, forsaking sleep to sift through thousands of legal documents. She and her husband, Tom, an attorney, ran a boutique foreclosure defense firm called Ice Legal. (Slogan: "Your home is your castle. Defend it.") Now they were up against one of Florida's biggest foreclosure law firms: Founded by multimillionaire attorney David J. Stern, it controlled one-fifth of the state's booming market in foreclosure-related services. Ice had a strong hunch that Stern's operation was up to something, and that night she found her smoking gun.

Read the whole story: Mother Jones

Comments

[JScott]

07:00 PM on 08/05/2010

Always wonder why banks are so urgent to get folks outta their houses, it can't be to sell em off, they can't get a decent price for em with the recession, and it irritates me and you know the neigbors hate it when the bank doesn't maintain the property and it just sits there looking like an eyesore.

[johndtuttle]

12:53 PM on 08/06/2010

It's because of the fees generated on commission. Just like when the loans were made originally even though the mortgage brokers were well aware the loan would never be paid off all they were interested in was their commissions.

Now, with foreclosure, the people that are driving the Bus make commissions based on how many homes they can foreclose on. The Bank's then write off the losses.

People are under the mistaken conclusion that Banks operate under some sort of Altruistic goal of helping their communities grow, with deposits that very same community gave them for Capital. In reality they are rats feeding on a corpse just hoping they don't get left with the bones...and screw the other rats.

[ejhickey]

01:28 PM on 08/06/2010

Banks are foreclosing because they are not being paid any money on their loan and some money is better than no money , even if it is a loss. also if a new owner buys the house for a lower price, they can start taking care of it and start paying taxes to the local government.

[valkyre]

09:37 PM on 08/06/2010

Many banks want to foreclose because they got sweetheart deals on taking over their competitors assets that allow then to collect money from the FDIC when they foreclose on a home: http://www.youtube.com/watch?v=HmodOyhAV68&feature=related

[ejhickey]

01:11 PM on 08/05/2010

Of course the whole foreclosure problem could be solved if the federal government would guarantee the price of all houses at the price people paid for them.

[OSCPJ]

07:11 PM on 08/04/2010

What everyone fails to understand is why Fannie and Freddie are doing this. The banks value their assetts at whatever they want as per FAS 157 which was passed in 2008 to make the banks look solvent. They can't afford to foreclose and take a loss. Fannie and Freddie, they are owned by the Government, so their loss is the taxpayers loss.

[rico ensabada]

04:15 PM on 08/04/2010

why can't one find a legal address(not a p.o. box)? for all those served with foreclosure notices, i recommend a simple legal envelope addressed(typed) to the that office with the return address to the same address and enclose a blank piece of paper. for about $2.50 in stamps, mail an envelope on a monday, then again on friday which will cover this 5 times. and if you know the attorney who signs the paperwork, put that name as ATT: in the addressed to. if it's from the court, use the court as the return address and the foreclosure law firm as the addressee. have fun! i have and will continue the employ such tactics.

[USNDC]

07:22 PM on 08/04/2010

I don't understand ... what will this accomplish ... please explain ... thanks.

[Passerineblue]

01:01 PM on 08/04/2010

Time is money in the mortgage business and people like Stern are paid to turn things around and get the people kicked out of the house as quickly as possible. However, given the mistakes and errors he and his firm made, he may find himself in deep do do. Frankly, the legal profession is better without him. He's not even practicing law. He just has a staff of word processors and junior attorneys who churn out these pleadings and appear in court.

The moral is, get yourself legal aid or a lawyer if one of these swamp things come at you. I read of one case where a judge forced Wells Fargo to pay two borrowers $250K in damages for emotional distress because of the number of mistakes Wells Fargo had made in both claiming the borrowers were in default when they weren't and overcharging. The case was really a horror story. These people got themselves a lawyer and as you can see it paid off.

Maybe instead of funding some worthless HAMP loan modification program, the gov't should fund legal aid for people to get professional help to fight back in the foreclosure process. There are a lot of unemployed lawyers out there and just getting the facts straight re amount owed, etc. doesn't require a legal genius or anyone with a lot of legal experience.

[cureyourosity]

12:08 PM on 08/04/2010

Government sponsored greed :-(

[cureyourosity]

12:06 PM on 08/04/2010

For the last 3 years Barney Frank has been at the helm the United States House Committee on Financial Services (also referred to as the House Banking Committee) who oversees the ENTIRE financial services industry, including the securities, insurance, banking, and housing industries. The Committee also oversees the work of the Federal Reserve, the United States Department of the Treasury, the U.S. Securities and Exchange Commission, and other financial services regulators.
When Obama finally gets serious about helping our housing market as well as truly affecting our financial services for the better of the American people He should start "cleaning house" by starting with Barney Frank & Fannie Mae.

[CalDemo]

12:30 PM on 08/04/2010

Without Barney Frank we wouldn't have had any Wall Street reforms and he wanted more than the republicans could stomach. He also was our stongest advocate for the Consumer Protection Agency. Better to look for a target on the other side of the aisle, though you can't find one who tendered a stray independent vote.

[OSCPJ]

07:13 PM on 08/04/2010

Barney wouldn't touch Fannie and Freddie. He never once mentioned the 1 Quadrillion Derivatives in a 2400 banking bill.

Barney is paid. Wonder how the SEC can refuse FOIA under the new law?

[Cipo]

09:36 PM on 08/04/2010

Please. The very fact that you can call that ridiculous gift to the banking cabal "reform" is laughable.

[Hdaryl01]

12:02 PM on 08/04/2010

Where is the Florida State Bar? The regulatory authority of lawyers, by lawyers, and for lawyers has done absolutely nothing. This is yet another example of sheer and utter regulatory failure on a profound level. Lawyers regulate themselves. Ethics complaints and grievances are filed and handled confidentially-to protect the lawyers. Ethics panels and grievance committees are packed with lawyers who protect other lawyers in every state. Nothing gets published publicly unless an ethics violation is found. Even then, as in this case, the penalties and sanctions are utterly meaningless in most cases. Stern was complained against in 2002, consented to malfeasance, which merely resulted in a public reproval. No suspension. No disbarment. And, nothing since.

People should be paying attention to this aspect of the story-not only what Stern has done, and is doing, completely unfettered and protected, but also what the State Bar regulators have not done, and refuse to do, for almost a decade.

Manufacturing, and knowingly filing false affidavits and forging and back dating notary stamps constitutes multiple felonies, not to mention multiple legal ethics violations. By any reasonable application of the laws and the rules as they should be applied and enforced, not only should Stern and other culpable attorneys in his firm be disbarred, they should also be serving time.

But, alas, there no longer are any rules. Nor are there any regulators who give a chit. No one cares. There are no rules. There are no consequences. And, the music keeps playing.

[ibsteve2u]

11:53 AM on 08/04/2010

"Flood-up/trickle-down" economics was obviously only the right's first shot at turning the shafting of the American people into a profit center.

They become ever more proficient...

[karen1p]

10:52 AM on 08/04/2010

All you people declaring it's the homeowners fault.....one question......

Historically, the rate of foreclosures nationwide has been not more than 2-3%, why is it that the currrent rate of foreclosures has shot to 15%???

[WordPlaya]

11:43 AM on 08/04/2010

You people just don't get it do you? We are talking about real people here, homeless children and families that are being affected by this poblem and it's consequences. Not everything in the universe is about money. Have some empathy for humanity and your fellow human beings, for god's sake. Makes me wonder if there is one anymore.

[karen1p]

11:46 AM on 08/04/2010

Did you read my post before responding? I AM ONE OF THOSE HOMEOWNERS!!! Of course I have empathy......what the fuc?

[OSCPJ]

07:14 PM on 08/04/2010

Who is going to pay? When you answer that you then should start demanding taxpayer money.

[FoonTheElder]

11:50 AM on 08/04/2010

The cause is from the bubble-meister Alan Greenspan, who kept interest rates low so to help George Bush get re-elected in 2004.
http://www.ritholtz.com/blog/2010/03/explaining-the-impact-of-ultra-low-rates-to-greenspan/

[BBackSoon]

10:51 AM on 08/04/2010

Sounds like an old school land grab. And we thought Obama was our gunslinger in the White hat.

[karen1p]

12:34 PM on 08/04/2010

It IS an old school land grab. And everyone is turning a blind eye.....including local and national AGs.....it's frightening.

[USNDC]

10:32 AM on 08/04/2010

Obama has sat back quietly ... while his "bailed out" Wall Street friends use their new found taxpayer money to foreclose on 1,000,000 more families this year alone.

Now Obama's Lawyer friends are in on the fun.

Barack Obama ... friend of the people !

[moonflowerjewelry]

10:26 AM on 08/04/2010

Yup.
Last year I worked for a friend, a foreclosure specialist (selling agent for banks, including FM). It did not go well and I didn't last long. I couldn't stand feeling like a vulture waiting for the moratorium would lift so we could kick people out of their homes. Hideous. It wasn't the job I thought I was signing on for, and I felt lousy every minute of it. They profited on one end by helping people buy houses they couldn't afford, then scrambling to maintain that living on the back end by moving those folks out. Ironically they had to short sale their McMansion that was purchased in the boom times.

[sc300nc]

10:22 AM on 08/04/2010

Is the prez counting all of these attornies jobs as jobs saved or created with his stimulus plan?

[DebtNavigation]

10:16 AM on 08/04/2010

Legal maneuvering has been availing in a vanishingly small number of #foreclosure cases. It's time to get practical and political. In short, buck the system through civil disobedience and change the system at the ballot box.

In Mexico in the mid-'90s Wall Street engineered a currency coup that tripled the debt owed by small businesses and family farms and also allowed for them to be massively ratejacked on top of it. Mexicans consequently formed the "el Barzon" movement and pushed back Wall Street and deposed their ruling party of 60+ years. In this country YouTube phenom Ann Minch has already declared the debtors' revolt and begun going after them http://www.revoltstartsnow.com

If you've been pushed under, you can read every other page of my book for free: http://www.scribd.com/doc/25443175/Debt-Hope-Down-and-Dirty-Survival-Strategies-Evaluation-Version-Complete