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Identity Theft Victim Can't Convince Freddie Mac He Owns His Home

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The Identity Theft Resource Center says Ty Powell is a victim of identity theft. Freddie Mac says he hasn't paid his mortgage in two years. The local paper says he's dead.

Powell says, "I don't know what to say."

He's afraid to leave his Casa Grande, Ariz. house for an extended period of time because the mortgage servicer, Chase, might send someone to break in and try to change the locks -- something Powell said already happened twice last year after the bank foreclosed on him.

The foreclosure was completed last July, and Powell, 30, could be evicted at any time. He said he doesn't sleep much. "I spent Christmas alone," he said.

Powell said he bought the house from a builder in January 2007, paying $217,000 in savings and cash he'd earned playing professional basketball in Brazil after graduating from Yale in 2002.

But as far as Freddie Mac knows, it owns a delinquent $376,703 mortgage taken out in November 2006. Powell said he was in Brazil at the time and had nothing to do with that mortgage.

Jay Foley, founder of the nonprofit Identity Theft Resource Center, said the builder apparently used Powell's personal information, which Powell sent months in advance from Brazil, to take out a fraudulent mortgage in his name. The builder went as far as to make some payments on the mortgage and even attempt a loan workout in 2008.

"The builder took out a mortgage on the house in Ty's name. Then he turned around and maintained the mortgage until Ty came back and bought that house," Foley said. "This builder sounds like a pretty slick dude and I would love to see him making little rocks out of big ones someplace."

Powell said he found an eviction notice on his door in March. He hired a pricey lawyer. "The argument was that I was not properly served," he said, "which was not the right argument." An Arizona judge ruled in favor of Freddie Mac in September.

Foley reached the same conclusion as Powell. "His attorney is arguing the wrong point," he said. "Instead of arguing the loan was fraudulent, the attorney's arguing it's the nature of the service because Ty wasn't served."

Now Powell owes tens of thousands in legal fees, both to his own lawyer and to Freddie Mac's.

Foley isn't the only one advocating for Powell. In October, his congresswoman, Rep. Ann Kirkpatrick (D-Ariz.), wrote a letter to Freddie Mac stating that the "home mortgage loan was secured without his consent along with various credit cards, and student loans." (Kirkpatrick was defeated in November by Republican Paul Gosar, whose office should now have Powell's case file.)

Freddie Mac just doesn't buy it. The loan is in default, the mortgage giant says, so it's their house now.

"We first learned of Mr. Powell's claim after the foreclosure was completed last July," a Freddie Mac spokesman told HuffPost. "He filed suit in March 2010 -- eight months later -- and our request for summary judgment was granted by the court on Sept. 14, 2010.

"We believe the foreclosure was legitimate because the loan secured by the property was in default. Despite a mortgage workout in 2008, no mortgage payment had been received since January 2009. We have also referred the matter to our fraud investigations unit."

The Casa Grande Dispatch reported this summer that Powell "died on July 12, 2010, at Casa Grande Regional Medical Center of heart problems."

Managing Editor Donovan Kramer Jr. told HuffPost there's no record of the email sent to the paper alleging Powell's passing, or much else. "This was a very brief one and apparently there was no corroborating information," he said.

Powell figures the death notice is a threat from the fraudster. Foley said it's more likely an effort by the perp to confuse Freddie Mac.

Either way, there's plenty of information corroborating the claim that Powell is a victim of identity theft. The Identity Theft Resource Center provided HuffPost with a stack of letters from banks and local municipalities absolving Powell of other, smaller frauds committed in his name, like phony accounts and drivers' licenses

Chase, the servicer of the allegedly-bogus mortgage, declined to comment because of "ongoing litigation" it refused to describe. Powell said he didn't know anything about that.

"I've exhausted all of my resources to try to remedy this," he said. Convincing Freddie Mac he doesn't have a mortgage, he said, is like convincing "birthers" that Obama has a legitimate birth certificate. "Obama has the luxury of dismissing these claims as from people on the fringe," he added. "I don't have the luxury of dismissing this ridiculousness."