Friday, October 29, 2010

Legal Theft in America

Hard to believe, but the courts and the government in America is allowing the banks to proceed with outright robbery. They are allowing the banks to "foreclose" property which the banks do not own. And the owners have very little recourse because, of course, they are on the wrong side of the law. The banks "own" the courts and the police and the government officials, so you litterly have to get down on your knees and beg officials to look at papers and undo the gross crime that has been committed. And this is very hard to do because everybody knows that "the banks can do no wrong".

From Barry Ritholtz's The Big Picture blog:
• Lawsuit accuses Bank of America of seizing wrong house: Dr. Alan Schroit filed the lawsuit Monday in the 122nd State District Court in Galveston against the bank with which he has neither a relationship nor a mortgage. (The Galveston County Daily News)

• Christopher Hamby of Wheelwright, Ky., filed a lawsuit against Bank of America for repossessing his home by mistake and refusing to pay for damages other than replacing the locks. (Floyd County Times)

• Jason Grodensky bought his modest Fort Lauderdale home in December, he paid cash. But seven months later, he was surprised to learn that Bank of America had foreclosed on the house, even though Grodensky did not have a mortgage. (Sun Sentinel)

• A Hampton Pennsylvania woman is suing Bank of America, saying one of its contractors wrongly repossessed her home, padlocked the doors, shut off the utilities, damaged the furniture and confiscated a pet parrot, though her mortgage payments were on time. (Pittsburgh Post-Gazette)

• Charlie P. and Maria Cardoso of New Bedford claimed that their home in Florida was free of any mortgage. They filed a lawsuit for a wrong foreclosure, claiming that the Bank of America had foreclosed. Their lawyers argued that the Bank had already been notified about the wrong foreclosure, in July, despite which it got foreclosed (South Coast Today)

• A Las Vegas woman whose condo was mistakenly emptied in a bungled foreclosure action could be the first person to benefit from a new state law. Nilly Mauck, left Las Vegas in mid-December for a snowboarding trip to Utah and returned to stay with a friend for a few days when she received a disturbing phone call. Something was amiss at the Coronado Palms condominium on Badura Avenue that she had owned for the past two years. (Las Vegas Sun)

• Ricky Rought paid cash to the Deutsche Bank National Trust Company for a four-room cabin in Michigan with the intention of fixing it up for his daughter. Instead, the bank tried to foreclose on the property and the locks were changed, court records show. (Dealbook)

• Sonya Robison is facing a foreclosure suit in Colorado after the company handling her mortgage encouraged her to skip a payment, she says, to square up for mistakenly changing the locks on her home, too. (Colorado Springs Business Journal)

• Thomas and Charlotte Sexton, of Kentucky, were successfully foreclosed upon by a mortgage trust that, according to court records, does not exist. (NYT)
Go to the Barry Ritholtz post to get the links to the underlying newspaper reports.

Here's Ritholtz's commentary on this outrageous "legal crime"...
Yesterday morning, I had The Misinformation Hour on TV as I got dressed for work. One of the comments that was made – “No one was wrongly thrown out of their home” — was repeated or ignored by hosts and guests alike.

This is patently demonstrably false, and yet no one challenged it.

The banks have gotten the Big Lie technique down to a science: State a lie so colossal that no one could believe anyone “has the impudence to distort the truth so infamously.” In practice, adding factually accurate, but irrelevant or misleading color, helps push the lie on unsusp0ecting rubes.

The banks and their many supplicants have been successful in doing just that in the robosigning issue. Any discussion about property rights, due process, or criminal investigations into perjury are thwarted; instead, the focus is on deadbeat homeowners. And note that I am the guy who in Q1 2010 wrote More Foreclosures, Please . . .)

The misdirection is successful, and the average reader/viewer/listener has no idea how badly they are being misinformed.

Beyond property rights and due process, the issue of this legal impossibility of being wrongly foreclosed upon (absent fraud), are the bailouts. Saving broken business models managed incompetently by bad management is a recipe for more errors and angst.

Fraudclosure is a perfect example of this. When you save broken companies from their own incompetence, this is what you get.

We have no record of how many people have been erroneously foreclosed — the banks themselves are the only centralized source of that data, and they ain’t talking — but we have lots of anecdotal evidence.

The plural of anecdote is not data; what is needed is a central collection of all the anecdotal errors of false or erroneous foreclosure — someone with a national office, say a US Attorney’s or Congressman’s office.
The rich have gotten rich in the US not only by distorting the regulatory and tax systems to give themselves an advantage, they have now become impatient and simply seized the legal system to allow them to execute outright theft by means of the instruments of state. Outrageous!

Not only have the ultra-rich scammed and stolen, they are busy undermining democracy via their bought-and-paid-for astro-turf "TEA party":

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