Bank Of America Wants Judge To Throw Out Racketeering Lawsuit Over 'Robo-Signers,' Foreclosures

NEW YORK (by Jonathan Stempel) - Bank of America Corp (BAC.N) has urged a federal judge to throw out a racketeering lawsuit over its alleged use of "robo-signers" in foreclosures.

The largest U.S. bank said the Indiana plaintiffs, who lost their home to foreclosure in 2009, failed to show they were harmed by its alleged practice of routinely submitting perjured affidavits, given they might have lost their home anyway.

It also said the plaintiffs do not deserve relief against Bank of America and its Countrywide Home Loans unit under a federal debt collection law because foreclosures are intended to protect lenders' interest in homes, not to collect debt.

Wednesday's filing with the U.S. District Court in Indianapolis provides an early glimpse into how lenders might defend against the growing number of lawsuits over foreclosure paperwork and securities backed by home loans.

Irwin Levin, a partner at Cohen and Malad LLP representing the plaintiffs Dwayne and Melisa Davis, did not immediately return a call seeking comment. The plaintiffs are seeking class-action status on behalf of thousands of homeowners.

Many homeowners and their lawyers accuse robo-signers of signing hundreds of foreclosure documents at a time on behalf of lenders without having read or understood their contents.

On Thursday, real estate company RealtyTrac Inc said banks foreclosed on 9 percent fewer homes in October than September as paperwork issues stalled processing.

Since the controversy began to swell in September, lenders such as Bank of America, JPMorgan Chase & Co (JPM.N), Wells Fargo & Co (WFC.N) and Ally Financial Inc's GMAC Mortgage have revealed paperwork problems, froze foreclosures, or both.

U.S. investigators, including all 50 state attorneys general, are examining whether banks prepared foreclosure documents that were false or poorly reviewed in order to evict borrowers.

"ROBO-SIGNER EXTRAORDINAIRE"

In their October 19 lawsuit, the Davises said they lost their Knightstown, Indiana home prematurely because of false affidavits from two robo-signers, including a nationally-known "robo-signer extraordinaire." They requested money damages.

But in its filing, Bank of America said that, by not trying to upset their foreclosure, the Davises could not show any harm caused by alleged inaccuracies in the underlying affidavits.

"Plaintiffs plead no facts to support their claim that the result, i.e., a judgment of foreclosure, would have been any different," wrote Matthew Strzynski, a partner at Krieg DeVault LLP representing the Charlotte, North Carolina-based bank.

Bank of America also said the law does not allow attacks on state court foreclosure judgments in federal court even if fraud is involved, and that the Davises waited too long by not raising their claims until after they lost their home.

The case is Davis v. Countrywide Home Loans Inc et al, U.S. District Court, Southern District of Indiana, No. 10-01303.

(Reporting by Jonathan Stempel in New York; editing by Andre Grenon)

Copyright 2010 Thomson Reuters. Click for Restrictions.

Comments

[Longtimeliberal]

05:25 PM on 11/30/2010

I can't imagine this will be thrown out. There are clearly systemic law violations when you look at the whole of the problem. The fact is the bank forclosing may not even legally own the home. The banks/hedge funds made up a electronic transfer system that avoided using regular documentation transfer at each county courthouse to avoid paying State fees. So banks would sell the property without legally transferring ownership. They have a problem.

[JohnnyWalkerBlueLabel]

11:45 PM on 11/21/2010

All these Democrat lawyers associates with robo-signing should be jailed for these infractions. This is a land with rule of law. These democrats have lost sight of this.

Also, all the deed transfer recording fees owed by MERS to county governments needs to be paid. This would probably be enough to bail out the failed states of CA and IL.

[wtf-please]

05:04 PM on 11/18/2010

But in its filing, Bank of America said that, by not trying to upset their foreclosure, the Davises could not show any harm caused by alleged inaccuracies in the underlying affidavits.

NOT SHOW ANY HARM...

THEY CRATERED THE GLOBAL ECONOMY.. lol probably cost ajob or created declining income.. class action lawsuits are being lined up for this very purpose..

[ChasG]

03:51 AM on 11/19/2010

Bank of America cratered the economy?  Specifics, please?

[Longtimeliberal]

05:29 PM on 11/30/2010

The big banks and their affiliates about threw the world economy to the Depression. They thought they could avoid paying State taxes with a made up manipulation thinking they would never get caught. Frankly, the best thing would be to have one of these guys get dissolved. If history is the judge the parts of the bank are then sold off and the economy ends up better with more moderate sized banks. I hope the congress then has the guts to go back and strengthen the regulations on Wall Street. These guys are just out of control.

[RightToCancel]

04:26 PM on 11/18/2010

One of the most rewarding things about this epic battle that is the foreclosure fight is meeting homeowners and other advocates who are standing up and fighting for themselves and fighting for the heart and soul of our courthouses. Our courts, our judges, our way of life is being transformed right before our eyes as real people are going into our courthouses and fighting for their homes and their own families. http://righttocancel.com/
In some ways I'll bet many of the judges appreciate seeing real people in their courtrooms. For decades judges have slaved away, largely in obscurity with only other lawyers to interact with. Now, they see some real people and hear their stories first hand, not filtered through their lawyers.
We have only seen the tip of the mortgage crisis. The scariest part currently of this crisis is that people are losing hope.The common consensus is "why bother...the bank doesn't care...why should I? I will just go rent." The American dream has gone from aspiring to own your own home to just hoping to keep your home. http://righttocancel.com/
If you feel that you have been a victim of predatory lending practices or are currently facing a foreclosure, contact us today and learn how you can take action against your lender using our proven administrative procedure that has already help so many people fight back against the banks and get resolution! [e-mail] Office:813-321-5114 ad me as friend

[Gatormouth]

03:54 PM on 11/14/2010

Much the same argument by was used by Al Capone in Chicago. People die every day, stores and dry cleaners have lots of fires too! Why single him out? PERSECUTION!

[DannyDiamond]

11:48 AM on 11/13/2010

Bank Of America Wants Judge To Throw Out Racketeering Lawsuit Over 'Robo-Signers,' Foreclosures...And the judge surely will! WAKE UP AMERICAN'S!! ORGANIZE YOURSELVES BEFORE IT'S TOO LATE!

[ChasG]

04:00 AM on 11/19/2010

Organize what?

[glojet]

04:01 PM on 11/30/2010

of course they want the judge to throw out the charges....corporate america has sold us all to satan...

[ChasG]

07:03 PM on 11/30/2010

No, there's a little satan in all of us.  We're only human.  That's why we have laws and government.

[TWOMANY]

07:59 PM on 11/12/2010

Bank of America -
TITLE 18 > PART I > CHAPTER 47 > § 1021

§ 1021. Title records

Whoever, being an officer or other person authorized by any law of the United States to record a conveyance of real property or any other instrument which by such law may be recorded, knowingly certifies falsely that such conveyance or instrument has or has not been recorded, shall be fined under this title or imprisoned not more than five years, or both.

--------end snip--------

The CEOs and their Foreclosure Mill Lawyers - should be prosecuted by LAW.

Lawyer responsible for false debt collection claim Fair Debt Collection Practices Act, 15 USCS §§ 1692-1692o, Heintz v. Jenkins, 514 U.S. 291; 115 S. Ct. 1489, 131 L. Ed. 2d 395 (1995). and FDCPA Title 15 U.S.C. sub section 1692.

Wells Fargo v. Reyes, 867 N.Y.S.2d 21 (2008). Dismissed with prejudice, Fraud on Court & Sanctions. Wells Fargo never owned the Mortgage.
-------

The FBI should have arrested these pukes already. Maybe we need to start investigating bank accounts in the FBI. Obviously the USAO is getting BRIBES from somewhere... gee I wonder who...?

[abetterplace]

06:15 PM on 11/18/2010

Oh yea, you've really got something here. One out of how many million. They are all crooks.

No! they aren't crooks, they just want the money they loaned to the low lives that won't pay them back.

[TWOMANY]

06:49 PM on 11/18/2010

They were PAID.

Why do investor lawsuits against lenders allege Mortgage Fraud then magically settle out of court? How did the lenders commit Mortgage Fraud against investors but not defraud borrowers?

Let’s see -
• They filed 100s of thousands PERJURED documents - Lawyers committing Perjury…
• They deliberately sold illegal mortgages to borrowers they knew could not repay.
• They deliberately sold those illegal mortgages to Sponsors but refused to comply with state laws to avoid paying State fees & taxes - REMIC violations
• They deliberately misrepresented the quality of these illegal mortgages to investors - REMIC violation - SEC violations - Fraud
• They deliberately INSURED those loans to cash-in the mortgage Insurance. That's insurance FRAUD
• They deliberately submitted fraudulent assignments to cover-up the FRAUDULENT investment and tax evasion. You know what they say about those cover-ups
• They deliberately submitted the false affidavits to illegally foreclose thus slide-in a quasi-Quiet Title to cover their illegal mortgage scam.

How does one "un-perjure" themselves? Filing Fraudulent Assignments - filing False Affidavits - Forgery - Breach of Contract, Fraud, Conspiracy to Defraud, Tax Evasion - Acts of Bad Faith, Mortgage Fraud, Fair Dept Collection violations, failure of Fiduciary Duty - Wrongful Foreclosure - Deceit and willful Misrepresentation, etc…

That's what the BANKS/LENDERS/BROKERS did. They BROKE the law. The consequences for breaking those laws prohibits them from foreclosing and repossessing the properties. THE BANKS BROKE THE LAW and KNEW the consequences.

[BlueSkyPilot]

03:07 PM on 11/12/2010

When people sign a contract with a bank they are obligated to pay. If the Bank can not prove direct ownership of the debt with a signature of the borrower they should not expect to be payed.

[zingdaddy]

05:36 PM on 11/12/2010

No, the bank has the right to sell or transfer your mortgage and act on behalf of the new owner. The title goes with the mortgage to the new owner. In the past, your bank would then collect your payments on behalf of this new owner, and send your payment along to them for a management fee, or you'd make your payments directly to the new owner.

Where the banks get into trouble is when they or transfer the mortgage to a company that securitizes it, splits the mortgage from the title and resells it who knows how many times, so there is no way to know who owns the mortgage or, if the title can be found, who legally owns it. The paperwork trail has been broken.

The bank cannot collect on behalf of a mortgage holder if that owner also does not hold the title. In the case of a securitized mortgage, that may not be possible to determine.The bank is required to provide a copy of the current title to the borrower or the borrower's representative upon request, usually prior to payment of a mortgage payment. If they can't produce the copy, they can't prove that they are the legal representative of the owner of the title.

At this point, a borrower can assume that the title to their property has been clouded, and that the bank has no legal standing to collect the mortgage payments. A competent real estate attorney should be consulted immediately.

[TWOMANY]

07:45 PM on 11/12/2010

That's not exactly correct. The Borrower goes to originator for loan. Originator sells loan to Bank. Bank sells loan to sponsor. Sponsor sells it to Depositor. Deopositor sells it to Trustee - and a cessPool is BORN with 1000s of other mortgages. Each of the sellers were paid in full. Those folks have NO-Recorse to that loan any longer - unless they are forced to Repurchase it because it was defective. The Trust hires a Servicer. That's the folks we pay.

PER LAW - ONLY the Real Party in Interest or Injured Party can state the claim. That Party MUST PROVE they are the party by providing the "wet-ink" signed docs. That is where the problems begin. The LENDERS deliberately DESTROYED many/most of these docs.
WORSE - the lenders never followed State Real Property Laws. Per Law - they waived their rights to repossess the property.
[A] plaintiff must have Constitutional standing in order for a federal court to have jurisdiction.” In re Foreclosure Cases, 521 F.Supp. 3d 650, 653 (S.D. Ohio, 2007) (citations omitted).

But, the servicing agent does not have standing, only a person who is the holder of the note has standing to enforce the note. See, e.g., In re Hwang, 2008 WL 4899273 at 8.

The Servicer may have standing if acting as an agent for the holder, assuming that the agent can both show agency status and that the principle is the holder. In re Vargas, 396 B.R. 511 (Bankr. C.D. Cal. 2008) at 520.

[Patriot86]

10:20 AM on 11/13/2010

When a bank officer perjures himself...we are obligated to arrest him and send him to jail or do you believe laws don't apply to bankers?

[ChasG]

03:04 PM on 11/21/2010

Can you cite any current cases (or links to stories) involving perjury by bank officers?

[Chris 54321]

10:46 AM on 11/12/2010

"I hope we shall crush in its birth the aristocracy of our moneyed corporations which dare already to challenge our government to a trial of strength and bid defiance to the laws of our country. "
Thomas Jefferson, 3rd US president 1801-1809

[Chris 54321]

10:44 AM on 11/12/2010

...."it is not illegal if corporations do it".

[right Alice]

11:43 AM on 11/12/2010

Yep, b/c they are, in essence, the govt.

http://market-ticker.org/akcs-www?blog=Market-Ticker&page=2

[humanbeing-rick]

10:22 AM on 11/12/2010

How dare Bank of America attempt to influence our judicial system and tell them to throw out one of the very few cases brought up against these crooks. They should be tried for the racketeering, corruption, and recklessness that made them so rich and powerful - and repugnant. Let the best man win, and keep the big money influence out of it.

[Aldyth]

08:49 AM on 11/12/2010

We already know that the banking industry has far more influence than the Average American. If the courts allow this to happen, they will simply be adding another piece of evidence that it is the case.

By the way, those of you who voted for Republican House members this season? You have enabled the banking industry in their effort to take your home and property without due process.

[miltonc4l]

09:22 AM on 11/12/2010

Use your head and break out of your narrow minded "two sides" world view. The vast majority of elected officials in both of these parties are willing to put the interests of the bankers first, regardless of the consequences to the average U.S. citizens.

President Obama is in charge of the EXECUTIVE branch of government. One of the primary duties of that branch is law enforcement. The president has the SEC, OTS, FDIC, OCC (all with regulatory powers over the banks) at his disposal. Not to mention the FBI and the entire justice department!! He could IMMEDIATELY order the Attorney General and the heads of all of these agencies to begin a comprehensive criminal investigation into the epidemic of fraud in the banking and financial industry.

These agencies willingly ignored the illegal practices which led to the so-called financial crisis. Their continued negligence and refusal to enforce the law is facilitating the cover-up, and the president will not lift a finger to stop it.

How do you reconcile that with your "Republican=evil Democrat=good" world view? If it fits, you might want to look up the phenomenon of "cognitive dissonance".

[Chris 54321]

10:43 AM on 11/12/2010

...... and then -

http://www.thirdworldtraveler.com/Controlling_Corporations/ControllingCorporations.html

[zingdaddy]

05:51 PM on 11/12/2010

Agreed, it's all politicians who are affected. But the nature of our government is to allow and even encourage citizens to influence it. That includes corporations.

Right now, corporations are required only to provide the highest profit to their shareholders, and that usually mean its top officers and board members. Th[is means their profit motives often clash[ with[ the needs of the nation, especially when multinational corporations are involved. Other countries can form American corporations and influence us as well. The only way I can see to address this mess is to fundamentally change the nature of corporations.

[take-it-back]

07:58 AM on 11/12/2010

if BofA has taken your house by fraud - find the exact same robo singer, find out where the directors of BofA live, and take THEIR house = after all fraud is now legal in the USA

suprised no one as done it yet, as a jury would lkely be very sympathetic

(just jokin' of course :) )

[Russell Masingale]

05:13 AM on 11/15/2010

no i like it. pitchforks and torches yall?

[Kyle Ransom]

07:57 AM on 11/12/2010

If I were to do this to homeowners I would be thrown under the jail. Time and time again large companies and in this case large banks are able to circumvent the law. Clearly these acts of improperly foreclosing on thousands of homeowners are criminal and they have devastated the lives of many homeowners.
For all those conservatives out there. I am not saying that it is O.K. to sidestep the obligation to pay the mortgage note. What I am saying is that is is not O.K. to have a bank to try to collect on the mortgage note or take back a property by way of foreclosure when the lender does not own the note in due course. This is called fraud and banks should be held accountable for this.

Kyle Ransom
http://gofightforeclosure.com

[maxhardon]

03:43 AM on 11/12/2010

"Bank of America also said the law does not allow attacks on state court foreclosure judgments in federal court even if fraud is involved".

Is this then a tacit admission of fraud?

[ItsBarranti]

03:27 PM on 11/12/2010

"the Indiana plaintiffs, who lost their home to foreclosure in 2009, failed to show they were harmed by its alleged practice of routinely submitting perjured affidavits, given they might have lost their home anyway."

"It doesn't matter that we committed perjury, they wouldn't have been able to pay anyway!"

... So, yes.