The banks are terrified they might actually be held accountable for their actions!

If you haven’t already heard, there is a monumental case that was heard Thursday morning in the Florida Supreme Court, and every single homeowner should be paying close attention to this case.

To watch a replay of the oral arguments, please click here.

The case is Roman Pino vs. Bank of New York. It involves all the customary fraud I have seen in countless cases.

Missing documents, fraudulent assignments, fraudulents notaries, and forged documents, and a bank once again trying to shuffle it’s dirty deeds under the rug like loose dirt.

When Bank of New York first tried to foreclose on Pino, a regular working guy from Greenacres who fell behind on his mortgage when his business dried up, there was no assignment of mortgage.

So Bank Of New York’s lawyers tried to re-file with a new assignment, one which was fraudulently backdated (AKA robosigned).

The bank’s original lawyers, by the way, were from David J. Stern’s office. You know their story.

When our good friend and colleague Tom Ice, Pino’s lawyer, challenged the documents, Bank of New York suddenly decided they didn’t want to foreclosure anymore, dropped their lawsuit and scurried back into their hole.

End of the story??

Not even close. Ice continued to dog Bank of New York like a pitbull, because he, believe it or not, also thinks the banks need to actually be held accountable! (Remarkable I know.)

He tried to have the voluntary dismissal overturned, so that Bank of New York could face sanctions for the forged documents they tried to use to swindle Roman Pino and the court.

Like countless others banks, Bank of New York got their hand caught in the cookie jar. But now they are trying to remove their hand before it slams on them.

While the lower courts have sided with the bank and refused to overturn the dismissal, the 4th District Court of Appeal has asked the Supreme Court to weigh in on a question of “great legal importance, which in their own words, “has the potential to impact the mortgage foreclosure crisis”, since “many, many mortgage foreclosures appear tainted with suspect documents.”

The question is whether banks can avoid punishment simply by dropping a foreclosure lawsuit.

So now you know why this case, and the legal implications it carries, has the entire banking industry shaking in their ratskin boots.

Even though Pino has already settled with Bank of New York, and ‘remarkably’ got to keep his home, the effect this decision will have will go far beyond Roman Pino.

It could finally mean justice for homeowners throughout the state of Florida.

The Mortgage Bankers Association and the Florida Bankers Association have filed a brief with the court, as have the American Land Title Association and the Florida Land Title Association.

Guess who they are backing?

All of these organizations are asking the Court to rule in Bank of New York’s favor, so they can continue the status quo.

The banks are playing a shell game, trying to get the Court to overlook the obvious frauds committed by Bank of New York, all in the name of a “potentially devastating” economic effect a judgement against Bank of New York might have.

In their brief the Bankers Associations claim that banks will write less home loans if they can’t dismiss and then re-file a foreclosure.

Is that a threat?

What they are really saying is ‘Just let us keep doing what we’ve been doing, and let’s forget all about the rules of law.”

The housing market will be just fine. This is a scare tactic on the part of the banks, so please don’t be fooled. They are just worried their con-game will come to an end.

What the Pino case is really about is the court protecting the integrity of the judicial system and protecting the constitution. It is imperative for court to rule against Bank of New York to keep its own integrity above repute.

It’s unfathomable that a bank could simply avoid punishment for a crime that would land you or me in jail just because they decided to drop their lawsuit.

Bank of New York is arguing the case should be left alone, because engaging in fraud is not reason enough to overturn the dismissal.

If the justices dismiss this case, banks will be able to walk away from their transgressions whenever they choose. It’s not only inappropriate, but outrageous.

Roman Pino vs Bank of New York goes to the heart of protecting our constitutional democracy, and it’s critical that the Florida Supreme Court reign in the illegal conduct and behavior of the banks, because as Ice wrote in his brief, the court should not “draw a line that protects wrongdoers and blesses fraud upon the court.”

If the justices side with the banks they will be encouraging continued falsehoods, their impartiality will be implicated, and a form a anarchy that will ultimately lead to total disrespect for our constitutional principles will be unleashed.

From The Trenches,

Roy Oppenheim

A group from the Miami Workers Center clean up the area around an abandoned bank-owned house, as police officers wait nearby (Photo Courtesy:Miami Workers Group)

It never ceases to amaze me the glaring duality of the world I live in.

I am constantly reminded that we live in world where you and I have to play by one set of rules, yet the vast financial complex that resides on Wall Street isn’t held to even a fraction of those standards.

The latest example comes way of a small protest in Liberty City last week.

A few members of the Miami Workers Center, a grassroots organization, arrived at an abandoned foreclosed home, a property that like countless others is nothing more than a glorified trash dump.

Their nefarious plot? To clean the home up, and try to make it a little less of an eyesore.

Scary right?

And what did this group, which included a grandmother and an pregnant woman, encounter when they arrived at that home?

About a half dozen cops, who threatened to arrest any of them if they stepped foot on the Bank Of America-owned property.

The protesters, to their credit, didn’t give up and cleaned up the public areas around the home. Not once was a burglary tool spotted.

The officers watched over these men and women like mother hens as they picked up beer bottles and broken glass, among other fabulous ‘accessories’ the home had accumulated over the last few years. (Bank of America took the home in 2010.)

But when the banks not only trespass, but break into my clients homes? How many police officers can I get on the case? Not a single one.

Even after the banks burglarize a home, when I have proof of a crime that would land you or I in jail, I am told it’s a civil matter, if I even get that.

Usually all I am left with is a big shrug. Banks can change locks or even tear a house apart, yet when a few ladies decide to pick up trash and try to better a neighborhood, that’s when the cops decide to enforce the laws?

Why do the property rights of banks, banks that simply do not care about their neighbors, mean more to the police than that of good citizens?

As Newsweek joined the voices wondering if in fact the banks are too big to jail, I ask you, how can we put them behind bars if we can’t even get an officer to respond?

Bankers have access and influence that just hasn’t been broken, even by a President who promised hope and change.

Newsweek points out that when it comes to justice in the financial sector, President Obama has not lived up to the hype.

Now he’s been busy when it comes to civil rights or health-care fraud, but when it comes to financial fraud the feds just can’t be bothered.

Prosecutions of financial crimes are at 20 years lows, and they’ve dropped nearly 40 percent since 2003.

Once again, it comes down to two sets of rules. Bankers get to pick and choose which rules they play by, but citizens trying to do some good don’t get that luxury.

From The Trenches,

Roy Oppenheim

Not only is America’s foreclosure crisis still going strong, it now comes with even more fraud and deception.

With heightened media coverage surrounding the recent national mortgage settlement and refinements to government assistance programs, experts say selling “the schtick” has only become easier for criminals. But there are red flags consumers can watch out for when trying to determine whether or not an organization is legit.

First, homeowners should never have to pay anything up front for a loan modification or information on how to negotiate with their lender, says Roy Oppenheim, whose Florida-based law firm Oppenheim Law has handled more than 1,000 mortgage and foreclosure fraud cases over the past 5 years.

“If you’re paying upfront to a non-lawyer who’s claiming they can modify your loan, that’s a big scam,” Oppenheim says.

Read More from US News and World Report

Short Sales Soar as Home Foreclosures Fall

The foreclosure crisis isn’t over, but a new trend in real estate sales could be the light at the end of the tunnel for many borrowers and lenders. Short sales, which occur when homeowners sell their homes for less than what they still owe, outpaced foreclosures for the first time ever in January,according to a new report from Lender Processing Services, Inc.

The Federal Housing Finance Agency announced this month that mortgage servicers will be required to review and respond to short sale offers within 30 days and make final sale decisions within 60 days. The new requirements, which take effect in June, have kept lenders busy expanding and training the staff needed to catch up with growing short sale demand.

“When the robosigning crisis hit, there was effectively an 18-month moratorium on foreclosures,” said Roy Oppenheim, a foreclosure defense attorney with Oppenheim Law in South Florida. “The banks got caught with their hand in the cookie jar and the lid slammed closed on it. Fraud, robosigning — it all came to a stop. But through this $25 billion settlement, they’re using the crisis to their advantage. The settlement creates a major incentive for the banks to do short sales.”

Read More from Lawyers.com

Short sales pick up in housing market

Lenders are pricing short sales more aggressively, RealtyTrac adds. In January, the average short sale price was 10% lower than a year earlier, exceeding the drop in U.S.home prices.

Some mortgage servicers started pursuing short sales more aggressively months ago. Bank of America says it did 107,000 short sales last year, up from 92,000 in 2010 and double the 2009 volume. New measures are also likely to boost short sales.

Freddie Mac and Fannie Mae, which own or guarantee 60% of home loans, will soon require lenders to decide short sale offers within 60 days. Realtors have complained that short sale offers often linger. The recent $25 billion mortgage settlement also encourages short sales.

New rules have slowed foreclosures in many states, increasing short sales, says Florida foreclosure defense attorney Roy Oppenheim.

Read More from USA Today

What would he have said about the banks fraudulent acts?

Last weekend Chuck Coulson, the man once called Richard Nixon’s ‘hatchet man”, passed away at the age of 80.

Known both for his being one of the ‘Watergate Seven’ and his subsequent 2nd life as a born-again evangelist, I can only wonder what he thought of of our current foreclosure crisis.

I don’t know if he ever gave it much thought, but I suspect there would be a level of amazement.

Watergate, which started over a single break-in, landed almost 50 men in jail, including many top Nixon aides like Coulson.

The banks have broken into thousands of homes in their efforts to secure ‘abandoned properties’. Except you and I both know that most of these homes were anything but abandoned.

Sometimes they weren’t even in foreclosure. I’ve had about a dozen clients who’ve had their locks changed or had their homes ransacked by repo agents who were hired by the banks.

The banks, playing the role of Nixon and his cronies, have used aggressive tactics that Coulson, in his days as Nixon’s legal counsel, might have employed.

Coulson allegedly said he would walk over his own grandmother to get the president re-elected, which sounds appropriate because banks have done almost everything else in order to foreclose on homeowners who often didn’t deserve it.

Yet for crimes that would seem to fit in any file on Watergate, there is not a single banking executive who has been arrested.

I’ll bet good money Coulson would wonder why.

Coulson was convicted for his efforts in trying to discredit the man who leaked the Pentagon Papers, but what would he have said about the ‘hatchet job’ banks have done on homeowners?

False documents, forged signatures, tax fraud, all in the name of the mighty dollar. Coulson would likely have admitted that everything the banks have done since the bubble burst is 1,000 times worse than anything he and his cronies did.

There have been many great injustices throughout our nation’s history, and when the book is finally closed on this era of “Too Big To Fail”, I think the banks illegal foreclosures efforts and their bastardization of our legal system will clearly outweigh Watergate.

From The Trenches,

Roy Oppenheim

Judge Signs $25 Billion Foreclosure Settlement

It’s finally official. The so-called $25 billion foreclosure settlement has been signed off by a federal judge.

This comes after the settlement was filed in court last month. DC District Judge Rosemary Collyer did the honors Wednesday.

I won’t rehash my thoughts about what’s good and what’s bad about this settlement. Everything that needs to be said about it has been said.

You and I know that the banks will get more of a pass than they are entitled to for all of their robosigning shenanigans. In reality they are really only paying out about $5 billion in actual money, and I’ve still haven’t seen a single banking officer jailed.

Just remember this fight ain’t over yet!. This settlement was a necessary step, in order for the feds to move on to their investigation into securitized trusts.

THAT is where the banks will hopefully get what’s really coming to them.

Mortgage settlement oversight begins in North Carolina

Now that the settlement is official, the new government agency that will be watching the banks is now open for business.

North Carolina Banking Commissioner Joseph Smith is going to oversee the office and how the banks will receive “credits” towards the settlement for providing homeowners mortgage relief.

Relief, unfortunately, will often come in the form of transactions, such as short sales, that the banks were already doing before the settlement was announced.

“By itself, this settlement will not remedy every problem that system faces. But trust in our mortgage system can move forward if we use this opportunity to show fairness, transparency and accountability,” Smith said. “

Let’s hope!

“Dramatic” 65 percent increase in Palm Beach County foreclosures

Just as I predicted! Last month I told the Palm Beach Post that banks had been given the green light to prosecute new foreclosure cases, and lo and behold, that is exactly what has happened.

The Post now reports that Palm Beach County saw a 65.4 percent increase in new foreclosure filings last month, compared to March of 2011.

Palm Beach Clerk and Comptroller Sharon Bock called the jump “dramatic”. I call it completely expected. The settlement has given banks a road map on how to proceed.

But as I have already said, with the Clerk’s Office about to have their budget significantly reduced, you will see another logjam in the court system.

Without the necessary support staff, it will be nearly impossible for the courts to keep up with the banks.

Fed lays out rules for banks to rent REOs

Another idea I’ve long advocated is beginning to see the light of day.

The Federal Reserve has laid out the groundwork on how banks can rent out foreclosed homes. There is nothing to be gained by allowing homes to remain empty, so this is an absolutely necessary step if the housing market is going to recover.

Of course there are many landlord/tenant, state and federal housing regulations that will need to be followed, and we can’t trust the banks to be good landlords on their own.

In their report the Federal Reserve says that banks “should use a framework that appropriately records the organizations’ rental decisions and transactions as they take place”

Let’s just hope that those records are better than the ones the banks kept during the robosigning era.

HA!!

Have a great Passover and Easter Holiday!

Bill extends Mortgage Debt Relief Act of 2007

I warned you earlier this month that if you’re considering a short sale, the time to get the ball rolling is now.

That’s because the Mortgage Debt Relief Act, which was passed in 2007, is set to expire at the end of this year. If that happens you’ll have to pay taxes on any forgiven debt that comes out of a short sale.

I remain skeptical that Congress, in this election year, will come through and extend the MDRA, but at least some Congressmen haven’t forgotten how important this legislation is. Then again, in an election year anything is possible.

U.S. Reps. Jim McDermott, D-Wash., Shelley Berkley, D-Nev., and John Larson, D-Conn., have introduced the Homeowners Tax Fairness Act. It would extend the Mortgage Debt Relief Act for another three years.

Let’s hope Congress gets their act together and passes this bill.

NY Foreclosure Case Could Be A Game Changer

It remains to be seen if a foreclosure dismissal will have an impact here in Florida, but none the less it has the chance to be a real game changer.

The case is OneWest Bank, FSC vs Galli. OneWest had tried for a partial summary judgement against the Gallis, but the judge in the case denied it and instead ruled in favor of Mr. and Mrs. Galli.

As I’ve always said, you have to make the banks prove they own the note, but in reality it’s more than that. I could pick up a note off the street and say I owned it, but it wouldn’t necessarily be true.

But Judge John Maltese correctly pointed out that MERS (the illegal entity the big banks set up to subvert the recordation system of our country) had assigned this mortgage several times before OneWest even came into the picture, something the judge ruled MERS did not have the right to do.

By the judge’s own words, “How the plaintiff came into possession of the mortgages and notes in this case is suspect.”

We have rules in place for a reason, rules the banks constantly try to skirt, so thank you to Judge Maltese for not allowing it in this case.

How Quilting Can Explain The Foreclosure Crisis

I never thought I’d use the words quilting and foreclosure in the same sentence, but there’s a first time for everything right?

San Francisco artist Kathryn Clark once worked as an urban planner, and her response to seeing people losing their homes was to turn neighborhood maps into a quilt, with an empty spot representing a foreclosed home.

The result is simple, yet a haunting example of what foreclosure can do to a neighborhood.

Even if you’ve never had to face foreclosure up front, I doubt you can look at one of her quilts and not come away with an understanding of just how widespread the foreclosure crisis is.

Have a great weekend and we’ll see you soon in the trenches!

Could Fannie Mae and Freddie Mac finally be willing to sign off on principal reduction as a way to keep homeowners out of foreclosure and in their homes?

Edward DeMarco, the acting head of the Federal Housing Finance Agency and de facto leader of the two GSEs has been steadfast in his opposition.

President Obama has made principal reduction priority one. It was one of the highlights of the mortgage settlement and many economists point to it as the way out of this housing mess.

But DeMarco still hasn’t budged, because he says principal reduction will cost the taxpayer money and isn’t good for Fannie and Freddie’s bottom line.

Except maybe it is.

According to NPR and ProPublica, executives at both Fannie Mae and Freddie Mac have concluded that principal reduction would prevent larger losses and in fact, save the two companies money.

Their report claims that in part because of new Obama incentives, which would reimburse lenders half of what they write off, that Fannie and Freddie would benefit from principal reduction

These presentations have yet to be made public, but Democrats are already clamoring to see them. And so am I.

Look I’m not saying that principal reduction comes without risk. Could everyone decide to stop paying their mortgages in order to get a write-down? Sure.

But just because you might get hit by a car doesn’t mean you don’t cross the street. The housing market will NEVER rebound if people keep getting kicked to the curb.

And I don’t care what Edward DeMarco has said, the bottom line shouldn’t be his bottom line. It shouldn’t be about what is cost effective, it should be about what keeps borrowers in their homes. Last time I checked, they are taxpayers too.

And now in the wake of NPR and ProPublica’s investigation, it seems DeMarco has few legs to stand on.

We’ve seen what happens when foreclosure infects a neighborhood. Boarded up homes. More crime. Lower home values. Can you really tell me that the risk of moral contagion is so powerful that you would rather see empty neighborhoods instead?

I remember one Congressman in early 2009 who said “I don’t give a —- about moral contagion. I just care about keeping folks in their homes!”

Nice Thought!

Whether you like it or not principal reduction is finally on the horizon. It is an viable option. It does keep people in their homes. And as I’ve said all along, that’s the end game.

More and more banks will do. Yes they had their hand forced. And so far the sky hasn’t fallen.

And while less Fannie and Freddie loans are seriously delinquent, we can’t have two sets of rules. So if it’s good for the goose (big banks) then it’s good for the gander (Fannie Mae and Freddie Mac)

Now Edward DeMarco told NPR that he is reviewing these proposals to accept principal reduction. He’s come off as the grumpy old troll before, refusing to budge despite what I think is overwhelming evidence in favor of principal reduction.

Maybe, just maybe, he will finally come around. If not, he’ll likely be set packing!

It’s time to call them out once more. Not for another column, but rather, a lack of one.

In October 2010 their column “The Politics of Foreclosure” made light of the plight many of my clients have undergone, and shrunk the foreclosure crisis down to a mere inconvenience for a few Washington insiders.

You and I, of course, know different.

And as the crisis grew wider and wider, and the expansiveness of the banks fraud became even more apparent, The Wall Street Journal’s Editorial Board continued to be a haven for outdated ideas, protection of the status quo and disgust for anyone trying to do good by the American homeowner.

When the AG settlement was first announced back in February, the Wall Street Journal called it a ‘bank job’ worthy of the Barker gang.

I found it disturbingly amusing that a settlement that was basically little more than a public spanking for the banks angered them so. The settlement didn’t land a single banking executive in jail, yet the columnists at The Wall Street Journal still treat the banks as the victims in the housing crisis.

The crisis, you know that the banks basically created.

The Wall Street Journal editorial board still believes the banks didn’t illegally foreclose on a single homeowner, something I personally know not to be true.

Either their editorial board is remarkably stupid or just ignorant.

And so I shouldn’t be all that surprised that they have been silent after the Department of Housing and Urban Development released audits that laid out how pervasive the culture of fraud was amongst our nation’s lenders.

If robosigning was, as The Wall Street Journal referred to it just the ‘nameless, faceless employee in the back office who reviewed the file, not the other nameless, faceless employee who sits in the front’, then why did the banks go through such giants roadblocks to keep HUD investigators at bay?

The entire process of submitting foreclosure claims was flawed, and HUD said exactly that. The pressure to push these illegal documents through came from the top. Managers ignored the signers admissions that they ‘could not handle the workload’, and responded by demanding a faster turnaround.

The lenders’ integrity was compromised, and the documents they submitted were, once again using HUD’s own words, unreliable and inauthentic…in other words, fraudulent.

But you wouldn’t know that if you read the Wall Street Journal’s editorials.

The paper reported on the audits yes, but there was no retraction, no admissions that maybe, just maybe, robosigning was more than an just a pesky little problem.

So where is the outrage now? Certainly not in the Wall Street Journal. Unless it’s against Eric Schneiderman. Or Martha Coakley.

Their editorial board must be living on another planet.

The outrage, however, is still right here in my blog.

The banks may not be trying to pass off fraudulent documents like they used to, but that doesn’t mean they won’t try every dirty trick in the book to get you out of your home.

As I said last year, the banks hijacked the judicial system (and they are still trying), and whether the Wall Street Journal will admit it or not, everyone else now knows it.