Tag Archives: Gutting the Underbelly of the Beast

UPL, FELONY PERJURY: THE UNINTENDED CONSEQUENCES OF DOCUMENT MANUFACTURING!

OP-ED — The author of this post is a consultant to attorneys on chain of title issues and the system of things. This is not legal advice but rather an exploration down a path that few even think to travel. 

“I was just doing my job.”  

What kind of response do you think you’d get from a robosigner in a deposition when asked how they prepared or executed a recorded assignment?

Part of what I have not discussed in my series on GUTTING THE UNDERBELLY OF THE BEAST is what might inadvertently happen when documents are manufactured by third-party or servicer document mills with the intended purpose of causing them to be recorded in the land records to give standing to a plaintiff in an upcoming (or current) foreclosure case.  For all intents and purposes, the documents were recorded to give some sort of legal force and effect, right?   After all, foreclosure mill lawyers and trustees (in non-judicial settings) rely on these assignments to go on about the business of stealing (uh, er, foreclosing on) peoples’ homes, right?

If I were go back into time (April 3, 2011) and trace the interviews conducted by Scott Pelley on the 60 Minutes segment, The Next Housing Shock, you would see a prime example of how a document mill operates.  These third-party document manufacturers exist all over the U.S. largely in part to excessive demands on the marketplace to produce still-missing documentation, designed to “fit” a specific situation to achieve a desired result.  The actual result was that Lorraine M. Brown (who has since served her time and is out of prison) was convicted for heading up a document mill that operated outside of the “arms-length” purview of the mortgage servicers, as Pelley explained on the broadcast.

Then there were two Florida attorneys working for the Attorney General’s office in Tallahassee: June Clarkson and Theresa Edwards.  Both were basically forced out of their jobs after releasing a detailed report on document manufacturing misbehaviors:

florida ag report_unfair deceptive and unconscionable acts in foreclosure cases

In March of 2012, the mortgage loan servicers and the 49 states Attorneys General came to an agreement NOT to continue the process of document manufacturing unless the documents actually contain legitimate information and are not misrepresentative in nature.  No sooner did the ink dry on that agreement, the servicers and the third-party mills working with servicers were back at it again.

From 2012 until as late as 2016, Bank of America cranked out tens of thousands of documents a year using contract workers in its Simi Valley, California manufacturing plant.  According to one worker there, when he complained to his supervisors that he didn’t feel right about what he was signing, he was told, “You’re lucky you have a job, now get back to work!”   His supervisor was undoubtedly NOT an attorney but rather, an actual employee of Bank of America.

Unauthorized Practice of Law, Explained (in pertinent part)

State Bars from across the country have gone after suspects who violated their statutes by practicing law without a license to do so.  Here’s a couple of examples of those statutes:

TEXAS

As you can see from the following language below, UPL is not just holding yourself out to be a lawyer or doing things only a lawyer could do without being licensed.  This statute applies to a whole range of concerns, which are then determined on an individual basis (I highlighted the pertinent parts):

SUBCHAPTER G. UNAUTHORIZED PRACTICE OF LAW

Sec. 81.101. DEFINITION. (a) In this chapter the “practice of law” means the preparation of a pleading or other document incident to an action or special proceeding or the management of the action or proceeding on behalf of a client before a judge in court as well as a service rendered out of court, including the giving of advice or the rendering of any service requiring the use of legal skill or knowledge, such as preparing a will, contract, or other instrument, the legal effect of which under the facts and conclusions involved must be carefully determined.

(b) The definition in this section is not exclusive and does not deprive the judicial branch of the power and authority under both this chapter and the adjudicated cases to determine whether other services and acts not enumerated may constitute the practice of law.

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Could an assignment be that “other document incident to an action or special proceeding”, such as a foreclosure wherein that document is given legal force and effect by the court in the taking of someone’s home?  Texas also has statutes that cover the recording of false documents:

Tex. Pen.Code, Title 7, Ch. 32, § 32.46(a)(1) makes it a felony to cause a forged or fraudulent document to be filed or recorded.

1. Common Law Fraud: To sustain a cause of action for actual fraud, the plaintiffs must prove (1) the defendant made a material representation that was false; (2) the defendant knew the representation was false or made it recklessly as a positive assertion without any knowledge of its truth; (3) the defendant intended to induce plaintiffs to act on the representation; and (4) plaintiffs actually and justifiably relied on the representation and thereby suffered damages. See Ernst & Young, L.L.P. v. Pac. Mut. Life Ins. Co., 51 S.W.3d 573 (Tex. 2001); 2. Texas Civil Practice & Remedies Code § 12.002 allows for recovery of up to $10,000 per fraudulent document; 3. Texas Civil Practice & Remedies Code § 16.003 provides for a 2-year challenge to recorded documents.

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Sadly, the two-year challenge to phony documents was probably put there by some self-serving legislators who were bought off by the banks, who knew that at some point, the suspect document might be discovered; however, it appears to run in conflict with the felony penal code’s mandates.  So which carries more weight? The penal code or the civil code?   If the penal code was enforced, the sheriff’s enforcing the laws couldn’t say, “Oh, it’s a civil matter. Take it up with the judge.”, as he’s kicking you to the curb.  A felony action runs longer than Texas’s civil code statute.

FLORIDA

Sadly, Florida Statutes only cover holding one’s self out as an attorney when one is not, but several case studies have presented us (below), with some interesting overviews about real property law:

” … the Court has held that it constitutes the unlicensed practice of law for a nonlawyer to prepare a warranty deed, quitclaim deed, land trusts, leases and mortgage agreements. The Florida Bar v. Irizarry, 268 So. 2d 377 (Fla. 1972); The Florida Bar v. Hughes, 697 So. 2d 501 (Fla. 1997); The Florida Bar v. Lister, 662 So. 2d 1241 (Fla. 1995); The Florida Bar v. Valdes, 464 So. 2d 1183 (Fla. 1985).”

UPL in Florida is a third-degree felony.  Florida appears very non-committal in its commentaries on what broadly constitutes UPL; however, as seen below from the General UPL Definitions, document manufacturing without a supervising attorney appears to be a real “gray area” (that needs some attention):

10-2. DEFINITIONS RULE 10-2.1 GENERALLY

Whenever used in these rules the following words or terms have the following meaning unless the use of the word or term clearly indicates a different meaning:

(a) Unlicensed Practice of Law. The unlicensed practice of law means the practice of law, as prohibited by statute, court rule, and case law of the state of Florida.

(b) Paralegal or Legal Assistant. A paralegal or legal assistant is a person qualified by education, training, or work experience, who works under the supervision of a member of The Florida Bar, an out-of-state lawyer engaged in the authorized practice of law in Florida or a foreign lawyer engaged in the authorized practice of law in Florida and who performs specifically delegated substantive legal work for which the supervising lawyer is responsible. A nonlawyer or a group of nonlawyers may not offer legal services directly to the public by employing a lawyer to provide the lawyer supervision required under this rule. It constitutes the unlicensed practice of law for a person who does not meet the definition of paralegal or legal assistant to use the title paralegal, legal assistant, or other similar term in offering to provide or in providing services directly to the public.

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Florida also has a felony perjury statute with teeth in it, as it has a civil component attached:

817.535 Unlawful filing of false documents or records against real or personal property.

(1) As used in this section, the term:

(a) “File” means to present an instrument for recording in an official record or to cause an instrument to be presented for recording in an official record.
(b) “Filer” means the person who presents an instrument for recording in an official record or causes an instrument to be presented for recording in an official record.
(c) “Instrument” means any judgment, mortgage, assignment, pledge, lien, financing statement, encumbrance, deed, lease, bill of sale, agreement, mortgage, notice of claim of lien, notice of levy, promissory note, mortgage note, release, partial release or satisfaction of any of the foregoing, or any other document that relates to or attempts to restrict the ownership, transfer, or encumbrance of or claim against real or personal property, or any interest in real or personal property.
(d) “Official record” means the series of instruments, regardless of how they are maintained, which a clerk of the circuit court, or any person or entity designated by general law, special law, or county charter, is required or authorized by law to record. The term also includes a series of instruments pertaining to the Uniform Commercial Code filed with the Secretary of State or with any entity under contract with the Secretary of State to maintain Uniform Commercial Code records and a database of judgment liens maintained by the Secretary of State.

(e) “Public officer or employee” means, but is not limited to:

1. A person elected or appointed to a local, state, or federal office, including any person serving on an advisory body, board, commission, committee, council, or authority.
2. An employee of a state, county, municipal, political subdivision, school district, educational institution, or special district agency or entity, including judges, attorneys, law enforcement officers, deputy clerks of court, and marshals.
3. A state or federal executive, legislative, or judicial officer, employee, or volunteer authorized to perform actions or services for any state or federal executive, legislative, or judicial office, or agency.
4. A person who acts as a general or special magistrate, auditor, arbitrator, umpire, referee, hearing officer, or consultant to any state or local governmental entity.
5. A person who is a candidate for public office or judicial position.
(2)(a) A person who files or directs a filer to file, with the intent to defraud or harass another, any instrument containing a materially false, fictitious, or fraudulent statement or representation that purports to affect an owner’s interest in the property described in the instrument commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(b) A person who violates paragraph (a) a second or subsequent time commits a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

(3) If a person is convicted of violating subsection (2) and the owner of the property subject to the false instrument is a public officer or employee, the offense shall be reclassified as follows:

(a) In the case of a felony of the third degree, to a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(b) In the case of a felony of the second degree, to a felony of the first degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.

(4)(a) If a person is convicted of violating subsection (2) and the person committed the offense while incarcerated in a jail or correctional institution or while participating in a pretrial diversion program under any form of pretrial release or bond, on probation or parole, or under any postrelease supervision, the offense shall be reclassified as follows:

1. In the case of a felony of the third degree, to a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
2. In the case of a felony of the second degree, to a felony of the first degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(b) If a person’s offense has been reclassified pursuant to this subsection, the sentencing court shall issue a written finding that the offense occurred while incarcerated in a jail or correctional institution and direct that a copy of the written finding and judgment of conviction be forwarded to the appropriate state institution or county facility for consideration of disciplinary action and forfeiture of all gain-time or any early release credits accumulated up to the date of the violation.

(5) If the person is convicted of violating subsection (2) and the owner of the property covered by the false instrument incurs financial loss as a result of the instrument being recorded in the official record, including costs and attorney fees incurred in correcting, sealing, or removing the false instrument from the official record as described herein, the offense shall be reclassified as follows:

(a) In the case of a felony of the third degree, to a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(b) In the case of a felony of the second degree, to a felony of the first degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(6) A person who fraudulently records a claim of lien in the official records pursuant to part I of chapter 713 is subject to the fraud provisions of s. 713.31 and not this section.
(7) If a person is convicted of violating this section, the sentencing court shall issue an order declaring the instrument forming the basis of the conviction null and void and may enjoin the person from filing any instrument in an official record absent prior review and approval for filing by a circuit or county court judge. The sentencing court may also order the instrument forming the basis of the conviction sealed from the official record and removed from any applicable electronic database used for recording instruments in the official record.
(8)(a) Any person adversely affected by an instrument filed in the official record which contains a materially false, fictitious, or fraudulent statement or representation has a civil cause of action under this section without regard to whether criminal charges are pursued under subsection (2). A notice of lis pendens in accord with s. 48.23 shall be filed which specifically describes the instrument under challenge and the real or personal property affected by the instrument.

(b) Upon a finding that the instrument contains a materially false, fictitious, or fraudulent statement or representation such that the instrument does not establish a legitimate property or lien interest in favor of another person:

1. The court shall determine whether the entire instrument or certain parts thereof are null and void ab initio. If the court finds the instrument void in its entirety, it may order the instrument sealed from the official record and removed from any electronic database used for indexing or locating instruments in the official record. The court may also, permanently or for a period of time, enjoin the defendant who filed the instrument or who directed the filer to file the instrument from filing or directing a person to file an instrument in the official records without prior review and approval for filing by a circuit or county court judge, provided that as to third parties who may have given value for an interest described or granted by any instrument filed in violation of the injunction, the instrument shall be deemed validly filed and provides constructive notice, notwithstanding any failure to comply with the terms of the injunction.
2. Upon a finding of intent to defraud or harass, the court or jury shall award actual damages and punitive damages, subject to the criteria in s. 768.72, to the person adversely affected by the instrument. The court may also levy a civil penalty of $2,500 for each instrument determined to be in violation of subsection (2).
3. The court may grant such other relief or remedy that the court determines is just and proper within its sound judicial discretion.
(c) The prevailing party in such a suit is entitled to recover costs and reasonable attorney fees.
(d) The custodian of any official record shall, upon payment of appropriate fees, provide a certified copy of the sealed instrument to the party seeking relief under this section for use in subsequent court proceedings; in addressing or correcting adverse effects upon the person’s credit or property rights, or reporting the matter for investigation and prosecution; or in response to a subpoena seeking the instrument for criminal investigative or prosecution purposes.
(e) Upon request, the custodian of any official record shall, upon payment of appropriate fees, provide a certified copy of the sealed instrument to any federal, state, or local law enforcement agency.
(f) If feasible, the custodian of the official record where the instrument is recorded shall record any court order finding that the instrument is null and void in its entirety or in certain parts thereof.
(g) An instrument removed from an electronic database used for recording instruments in the public record pursuant to this section shall be maintained in a manner in which the instrument can be reduced to paper form.
(9) A government agency may provide legal representation to a public officer or employee if the instrument at issue appears to have been filed to defraud or harass the public officer or employee in his or her official capacity. If the public officer or employee is the prevailing party, the award of reasonable attorney fees shall be paid to the government agency that provided the legal representation.
(10) This section does not apply to the procedures for sealing or expunging criminal history records as provided in chapter 943.
History.s. 1, ch. 2013-228.

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The foregoing is some pretty substantive stuff, eh?   Now let’s examine a couple of the key items that got Florida foreclosure mill attorney (su casa, mi casa) David J. Stern disbarred:

In Count One of the Complaint that got him disbarred, at Paragraph 6:

During all times material, respondent elevated several staff to managerial/supervisory positions in the Stern law firm, including, but not limited to, attorneys Beverly McComas and Miriam Mendieta, and nonlawyer, Cheryl Samons, who was the office manager of the foreclosure department and/or manager of operations.

Cheryl Samons’ signature (as you may have been aware) showed up on thousands of documents as an Assistant Secretary of Mortgage Electronic Registration Systems, Inc., many times utilizing a notary (Terry Rice) whose commission was not valid at the time of acknowledgment.  These documents were then recorded in land records all over Florida and used to foreclose on unsuspecting homeowners.

Paragraphs 9 , 14 and 16 (of the Bar Complaint further stated:

(9) In their supervisory capacity, Mendieta, McComas, and Samons were accountable and answerable only to David J. Stern as the managing attorney and sole shareholder of the Law Offices of David J. Stern, P.A.

(14) Ultimately, the firm’s supervisory echelon employees such as Mensieta, McComas, and Samons, due to their extensive supervisory and managerial duties and responsibilities were given annual salaries that ranged from $200,000 to $600,000.

(16) David J. Stern’s lack of supervisory oversight, together with that of the supervisory echelon, contributed to many allegations of misconduct, including many judicial referrals to the Bar, on the part of the Stern law firm and its associates, which included, but were not limited to: (B) Improperly executed and/or improperly notarized documents, including, but not limited to, assignments of mortgage, and affidavits of reasonable attorneys’ fees …”

So if David J. Stern was not directly supervising the activities of Cheryl Samons, she could pretty much do whatever she wanted, including drafting documents that contained false and misrepresentative information (under Florida Criminal Code § 817.535).

Don’t you think that these third-party document mills operate in much the same way?   Without attorney supervision?   Exactly how much did Cheryl Samons get paid?

What is so different from what David J. Stern got disbarred for … and Lorraine M. Brown went to prison for … that these robosigners and their respective notaries can’t be held to the same criminal standards?  All of the depositions I’ve read of Stern Law Firm employees say nothing about how much anyone got paid and none of them appear to inquire as to the accuracy of the information contained on the document, with the exception of authority vested in the signer by MERS.

CALIFORNIA

BUSINESS AND PROFESSIONS CODE – BPC

DIVISION 3. PROFESSIONS AND VOCATIONS GENERALLY [5000 – 9998.11]

( Heading of Division 3 added by Stats. 1939, Ch. 30. )

CHAPTER 4. Attorneys [6000 – 6243]

( Chapter 4 added by Stats. 1939, Ch. 34. )

ARTICLE 7. Unlawful Practice of Law [6125 – 6133]

( Article 7 added by Stats. 1939, Ch. 34. )

6125.

No person shall practice law in California unless the person is an active licensee of the State Bar.

(Amended by Stats. 2018, Ch. 659, Sec. 89. (AB 3249) Effective January 1, 2019.)

6126.

(a) Any person advertising or holding himself or herself out as practicing or entitled to practice law or otherwise practicing law who is not an active licensee of the State Bar, or otherwise authorized pursuant to statute or court rule to practice law in this state at the time of doing so, is guilty of a misdemeanor punishable by up to one year in a county jail or by a fine of up to one thousand dollars ($1,000), or by both that fine and imprisonment. Upon a second or subsequent conviction, the person shall be confined in a county jail for not less than 90 days, except in an unusual case where the interests of justice would be served by imposition of a lesser sentence or a fine. If the court imposes only a fine or a sentence of less than 90 days for a second or subsequent conviction under this subdivision, the court shall state the reasons for its sentencing choice on the record.

(b) Any person who has been involuntarily enrolled as an inactive licensee of the State Bar, or whose license has been suspended, or has been disbarred, or has resigned from the State Bar with charges pending, and thereafter practices or attempts to practice law, advertises or holds himself or herself out as practicing or otherwise entitled to practice law, is guilty of a crime punishable by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code or in a county jail for a period not to exceed six months. However, any person who has been involuntarily enrolled as an inactive licensee of the State Bar pursuant to paragraph (1) of subdivision (e) of Section 6007 and who knowingly thereafter practices or attempts to practice law, or advertises or holds himself or herself out as practicing or otherwise entitled to practice law, is guilty of a crime punishable by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code or in a county jail for a period not to exceed six months.

(c) The willful failure of a licensee of the State Bar, or one who has resigned or been disbarred, to comply with an order of the Supreme Court to comply with Rule 9.20 of the California Rules of Court, constitutes a crime punishable by imprisonment pursuant to subdivision (h) of Section 1170 of the Penal Code or in a county jail for a period not to exceed six months.

(d) The penalties provided in this section are cumulative to each other and to any other remedies or penalties provided by law.

(Amended by Stats. 2018, Ch. 659, Sec. 90. (AB 3249) Effective January 1, 2019.)

6126.3.

(a) In addition to any criminal penalties pursuant to Section 6126 or to any contempt proceedings pursuant to Section 6127, the courts of the state shall have the jurisdiction provided in this section when a person advertises or holds himself or herself out as practicing or entitled to practice law, or otherwise practices law, without being an active licensee of the State Bar or otherwise authorized pursuant to statute or court rule to practice law in this state at the time of doing so.

(b) The State Bar, or the superior court on its own motion, may make application to the superior court for the county where the person described in subdivision (a) maintains or more recently has maintained his or her principal office for the practice of law or where he or she resides, for assumption by the court of jurisdiction over the practice to the extent provided in this section. In any proceeding under this section, the State Bar shall be permitted to intervene and to assume primary responsibility for conducting the action.

(c) An application made pursuant to subdivision (b) shall be verified, and shall state facts showing all of the following:

(1) Probable cause to believe that the facts set forth in subdivision (a) of Section 6126 have occurred.

(2) The interest of the applicant.

(3) Probable cause to believe that the interests of a client or of an interested person or entity will be prejudiced if the proceeding is not maintained.

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As you can see from California’s statutes, there really isn’t much in the way of disciplinary punishment for those actually “doing the deed”, other than felony perjury under the Penal Code:

PENAL CODE – PEN

PART 1. OF CRIMES AND PUNISHMENTS [25 – 680]

  ( Part 1 enacted 1872. )

TITLE 7. OF CRIMES AGAINST PUBLIC JUSTICE [92 – 186.34]

  ( Title 7 enacted 1872. )

CHAPTER 4. Forging, Stealing, Mutilating, and Falsifying Judicial and Public Records and Documents [112 – 117]

  ( Chapter 4 enacted 1872. )

115.  

(a) Every person who knowingly procures or offers any false or forged instrument to be filed, registered, or recorded in any public office within this state, which instrument, if genuine, might be filed, registered, or recorded under any law of this state or of the United States, is guilty of a felony.

(b) Each instrument which is procured or offered to be filed, registered, or recorded in violation of subdivision (a) shall constitute a separate violation of this section.

(c) Except in unusual cases where the interests of justice would best be served if probation is granted, probation shall not be granted to, nor shall the execution or imposition of sentence be suspended for, any of the following persons:

(1) Any person with a prior conviction under this section who is again convicted of a violation of this section in a separate proceeding.

(2) Any person who is convicted of more than one violation of this section in a single proceeding, with intent to defraud another, and where the violations resulted in a cumulative financial loss exceeding one hundred thousand dollars ($100,000).

(d) For purposes of prosecution under this section, each act of procurement or of offering a false or forged instrument to be filed, registered, or recorded shall be considered a separately punishable offense.

(e) (1) After a person is convicted of a violation of this section, or a plea is entered whereby a charge alleging a violation of this section is dismissed and waiver is obtained pursuant to People v. Harvey (1979) 25 Cal.3d 754, upon written motion of the prosecuting agency, the court, after a hearing described in subdivision (f), shall issue a written order that the false or forged instrument be adjudged void ab initio if the court determines that an order is appropriate under applicable law. The order shall state whether the instrument is false or forged, or both false and forged, and describe the nature of the falsity or forgery. A copy of the instrument shall be attached to the order at the time it is issued by the court and a certified copy of the order shall be filed, registered, or recorded at the appropriate public office by the prosecuting agency.

(2) (A) If the order pertains to a false or forged instrument that has been recorded with a county recorder, an order made pursuant to this section shall be recorded in the county where the affected real property is located. The order shall also reference the county recorder’s document recording number of any notice of pendency of action recorded pursuant to paragraph (2) of subdivision (f).

(B)  As to any order, notice of pendency of action, or withdrawal of notice of pendency of action recorded pursuant to this section, recording fees shall be waived pursuant to Section 27383 of the Government Code.

(f) A prosecuting agency shall use the following procedures in filing a motion under subdivision (e):

(1) Within 10 calendar days of filing a criminal complaint or indictment alleging a violation of this section, the prosecuting agency shall provide written notice by certified mail to all parties who have an interest in the property affected by the false or forged instrument, or in the instrument itself, including those described in paragraph (5).

(2) (A) Within 10 calendar days of filing a criminal complaint or indictment alleging a violation of this section, the prosecuting agency shall record a notice of pendency of action in the county in which the affected real property is located.

(B) Within 10 calendar days of the case being adjudicated or dismissed without obtaining an order pursuant to subdivision (e), the prosecuting agency shall record a withdrawal of the notice of pendency of action in the county where the affected real property is located.

(3) The written notice and notice of pendency of action described in paragraphs (1) and (2) shall inform the interested parties that a criminal action has commenced that may result in adjudications against the false or forged instrument or the property affected by the false or forged instrument, and shall notify the interested parties of their right to be heard if a motion is brought under subdivision (e) to void the false or forged instrument. The notice shall state the street address, if available, and the legal description of the affected real property.

(4) Failure of the prosecuting agency to provide written notice or record a pendency of action as required under paragraphs (1) and (2) within 10 calendar days shall not prevent the prosecuting agency from later making a motion under subdivision (e), but the court shall take the failure to provide notice or record a pendency of action as required under paragraphs (1) and (2) as reason to provide any interested parties additional time to respond to the motion. Failure of the prosecuting agency to so notify interested parties under this subdivision or record a pendency of action as required under paragraphs (1) and (2) within 10 calendar days shall create a presumption that a finding as described in paragraph (9) is necessary to protect the property rights of the interested party or parties.

(5) If the instrument sought to be declared void involves real property, “interested parties” include, but are not limited to, all parties who have recorded with the county recorder in the county where the affected property is located any of the following: a deed, lien, mortgage, deed of trust, security interest, lease, or other instrument declaring an interest in, or requesting notice relating to, the property affected by the false or forged instrument as of the date of the filing of the criminal complaint or indictment.

(6) Any party not required to be noticed under paragraph (1) or (5) who nonetheless notifies the prosecuting agency in writing of the party’s desire to be notified if a motion is brought under subdivision (e) to void the false or forged instrument shall be treated as an interested party as defined in paragraph (1) or (5).

(7) The court shall set a hearing for the motion brought by the prosecuting agency under subdivision (e) no earlier than 90 calendar days from the date the motion is made. The prosecuting agency shall provide a copy by certified mail of the written motion and a notice of hearing to all interested parties described in paragraphs (1), (5), or (6), and all other persons who obtain an interest in the property prior to recordation of notice of pendency of action no later than 90 days before the hearing date set by the court. The notice shall state the street address, if available, and the legal description of the affected real property.

(8) At a hearing on a motion brought by the prosecuting agency under subdivision (e), the defendant, prosecuting agency, and interested parties described in paragraphs (1), (5), or (6), shall have a right to be heard and present information to the court. No party shall be denied a right to present information due to a lack of notice by the prosecuting agency or failure to contact the prosecuting agency or the court prior to the hearing.

(9) (A) At a hearing on a motion brought by a prosecuting agency under subdivision (e), if the court determines that the interests of justice or the need to protect the property rights of any person or party so requires, including, but not limited to, a finding that the matter may be more appropriately determined in a civil proceeding, the court may decline to make a determination under subdivision (e).

(B) If, prior to the hearing on the motion, any person or party files a quiet title action that seeks a judicial determination of the validity of the same false or forged instrument that is the subject of the motion, or the status of an interested party as a bona fide purchaser of, or bona fide holder of an encumbrance on, the property affected by the false or forged instrument, the court may consider that as an additional but not dispositive factor in making its determination under subdivision (e); provided, however, that a final judgment previously entered in that quiet title action shall be followed to the extent otherwise required by law.

(g) As used in this section, “prosecuting agency” means a city attorney, a district attorney, the Attorney General, or other state or local agency actively prosecuting a case under this section.

(h) An order made pursuant to subdivision (e) shall be considered a judgment, and subject to appeal in accordance with, paragraph (1) of subdivision (a) of Section 904.1 of the Code of Civil Procedure.

(Amended by Stats. 2014, Ch. 455, Sec. 1. (AB 1698) Effective January 1, 2015.)

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LAW FIRM PARTICIPATION

When it comes to the actual document recording, you may see the law firm involved in the preparation or handling of the document.  Here are some examples:

As opposed to other law firms who are doing the foreclosing that rely on third-party document mills, title companies and servicer document mills to manufacture standing to keep documents beyond arms-length for the purposes of plausible deniability in the preparation of these suspect documents:

NDEX West LLC is another name for National Default Exchange, which foreclosure mill Barrett Daffin (a North Dallas foreclosure mill with offices on the West Coast) is involved in. At one time, then-California Attorney General Kamala Harris was investigating NDEX West.  It is uncertain whether that investigation has been concluded. NDEX West may or may not even be aware that it was or is currently being investigated (unless someone reads this blog and tells them about it).  I was made aware of the investigation through my corporate attorney, who was contacted by Kamala Harris’s office.

When the law firm participates, one must determine (generally through bona fide discovery … and not just your own personal opinion) whether the law firm actually “supervised” the execution and/or preparation of the document; how much interaction the law firm had with the document’s execution and/or creation; and whether or not the law firm reviewed any alterations to the document (common in third-party document mills), wherein you see a lot of surrogate signing, notary fraud and other suspect issues that have to be vetted, NOT TO MENTION the actual information being false and in violation of statutes like the foregoing California Penal Code and the Florida Criminal Code § 817.535.

It further makes one wonder HOW people can create, execute and cause to be recorded millions of documents (which are separate acts of perjury committed under the statutes) and not get burned by UPL issues because they created documents with the purported effect of representing something of a legal nature in the land records without the review and/or supervision of a licensed attorney.  This is something that the legislatures of all 50 states certainly need to take a closer look at because illicit document manufacturing has not stopped, despite what the servicers say!

Then you’d obviously ask yourself … if Cheryl Samons was allowed to do what she did and her acts constituted suspect felony behavior, why isn’t she in jail too?  Not only did her suspect assignment show up in the Harpster case in Pasco County, Florida, years later one of those same suspect assignments showed up in a Hillsborough County, Florida case! strominger assn_stern

The Strominger case was eventually dismissed.

THE SYSTEM OF THINGS HASN’T BEEN PLAYED OUT YET

In Nevada, two title officers with LPS were taken to task on a 606-count indictment, only to have all of those charges thrown out due to prosecutorial misconduct.

David J.Stern may have been disbarred; however, he still is out of the business with a puttload of money from his ill-gotten gains as the reputed “King of the Foreclosure World”. He had the supervisory capacity to oversee his non-lawyer staff (as mandated by bar rules), yet he apparently chose to ignore them.  If document mills don’t have “supervisory attorneys”, what would the unintended consequences of document manufacturing by companies like Indecomm Global Services, Security Connections and Nationwide Title Clearing be?

The reason Samons and others like her are NOT in jail is because we do not go far enough into “the system of things” to make that happen.  We are simply happy to NOT be foreclosed on and that’s good enough for us right now.   Why spend the extra money?

Maybe at a point in time in the near future … we’ll get there.  But for now, until someone rises to the occasion within a legal proceeding, we’re not there yet.  Keep in mind that it is my suggestion to ALWAYS depose a notary first and make sure to have a copy of the office floor plan.  Most of the leasing agents have access to them, as required under a lease, to illustrate “finish out” details.

Below is an example of one signing room floor plan (allegedly MERS’s address in Ocala, Florida, which really belonged to EDS):

The foregoing illustration was actually used in the promotion of the agent, who referred to this location as ideal for a “document manufacturing plant”.  Where in the hell did he get that idea from?   I generally look at these floor plans to determine the location of where the notaries are located, versus the persons executing the documents.  One of Bank of America’s so-called “employees” chose to admit in an interview that none of his signatures were ever witnessed by notaries when he worked in that document manufacturing plant for over three years.  His documents were collected from him and taken to the notary section to be acknowledged, which contradicts what the notarial execution language says, “under Penalty of Perjury under the laws of the State of California.”   Am I making sense here?  I recently received a copy of an assignment of mortgage signed by this admitted robosiger/contract worker for Bank of America, which goes to show you that the “damage” created by the recording of these documents (to that property’s chain of title, etc.) is on-going, despite what the banks and their servicers may think.

CIVIL CONSPIRACY IN RELATION TO DOCUMENT MANUFACTURING

How many robosigners and notaries does it take to form a civil conspiracy?   One of each.   If a law firm was giving any “direction” or “supervision” to the matter of executing and recording these documents, don’t you think they’ve become part of that “conspiracy”?   We’ll leave that question for a solid answer when someone manages to get proper discovery in a future case.  If you manage this, please let me know!  We’d all like to know.

In most U.S. states, civil conspiracy is not actionable in of itself (as a cause of action); however, according to existing case law, civil conspiracy can be used to prove the intent in an underlying tort (misrepresentation).  This is where we get back into document content and not whether someone had permission from MERS.  In my book, a corporate resolution that the Grantor cannot or refuses to prove had teeth in it (which MERS constantly refuses to prove) in order for someone to sign on its behalf poses an interesting challenge.  Does MERS actually become part of the civil conspiracy because of some alleged authority granted by it?  MERS can’t stay hidden in the woodwork forever.  At some point, the courts (I predict) will determine some sort of liability connected with a criminal proceeding.

Again, the system of things has to come full circle for this to occur.

 

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THE SYSTEM OF THINGS COMES HOME TO ROOST IN OREGON!

(BREAKING NEWS – OP-ED) —  The author of this post is a consultant to attorneys on matters involving chain of title, foreclosure matters and issues related to the system of “things”. This isn’t legal advice.  It’s the system’s way of telling you something’s wrong. 

PORTLAND, OREGON … Another group of attorneys, accompanied by a non-profit Oregon civil liberties group (made up of lawyers) has decided that the Oregon Bar has violated their civil rights and wants a federal court to stop the Oregon State Bar (a Public Corporation) from mandating that attorneys HAVE TO join their little “club” in order to practice law.

As I explained previously in GUTTING THE UNDERBELLY OF THE BEAST – PART 8, two Oregon attorneys filed a challenge to the Oregon State Bar’s public statement containing political views the two didn’t agree with nor subscribe to as part of the dues they pay the Oregon State Bar, claiming their civil rights have been violated.

Instead of simply suing the Oregon State Bar, Daniel Crowe, Lawrence Peterson and the Oregon Civil Liberties Attorneys have filed civil rights claims against the Bar’s Board of Governors, its President, its President-elect, its CEO, its Director of Finance and Operations and its General Counsel, claiming they all had a hand in the violation of their freedom of speech, freedom of association and for damages caused by charging them attorney fees to belong to what we in the mainstream like to call “the good ‘ol boy club”.

It stands to reason that every State of the Union has a Bar Association, which regulates the professional behaviors of counsel that practice law within its jurisdiction and to protect the public from unscrupulous behavior caused by them or the people who work for them who are non-lawyers.  These same bar associations also go after non-lawyers who hold themselves out as if they were lawyers in order to collect fees for writing pleadings and advertising their services at a discount, hoping to gain an income, which in effect, deprives lawyers of their income.  It’s what they called the unauthorized practice of law.

Even the U.S. Supreme Court has gotten into the act, its citations abound, as noted within the pleadings, which you can read here:

Crowe et al v Oregon State Bar et al, U.S. D. Ore No 3-18-cv-02139 (Dec 13, 2018)

For those of you who need some background, here is the original suit originally filed, that contains the actual political speech as an attached exhibit:

Gruber, Runnels v Oregon State Bar, US D. Ore No 3-18-cv-1591 (Aug 29, 2018)

It also stands to reason that every other major profession that operates within each state (insurance salesmen, credit service organizations, hair stylists, architects, engineers, etc.) also be regulated to prevent public harm, which an argument has also been made that this licensing entity should include lawyers (in other words, when we have the State doing it, why should we even have a bar in the first place?) under its governing umbrella.

Why am I not surprised that political advocacy-based litigation was prompted when the Oregon State Bar decided to publicly post a statement containing political undertones shortly after the “push back” occurred in downtown Portland?   This has brought “the system of things” to its opposite extreme … challenging the constitutionality of the “bar association” altogether using the Oregon State Bar as a poster child, specifically citing the April 2018 Bar Bulletin, which included two statements on alleged “white nationalism”, one of which specifically criticized President Donald Trump, attached as an exhibit to the pleadings.

I think we can all agree that the two-party system of things we have currently in place in America has screwed us all in one way, shape or form.  Each one of you have a bone to pick with the way things operate in America, right?  We all want America to be a better place, but instead, thanks to politics of all shapes and sizes, all of our civil liberties have been trampled on … and we sit idly by doing nothing while both sides promulgate their agendas upon us while wasting our tax dollars.  So it’s not just the Bar that’s in play here, it’s our whole system of things.

If we take away the Bar’s right to discipline its own membership, then how can we stop the bank’s attorneys from lying to judges and screwing all of us over in courts all across America?  How then can we stop law firms from participating in the creation and execution of documents that are recorded in our land records, particularly assignments of mortgage and deed of trust, that create standing for plaintiffs who have no enforcement rights to notes and mortgages, from continuing to come into court and illicitly rape Americans of their wealth with no consequence to them or the judges with their agendas that give them what they want (your homes)?

To some of you, this may be nothing more than airing dirty laundry before the American public in federal court; however, this is where you go when you want to go after a State Corporation, because the “state” will circle its wagons when attacked … and you’ll get nowhere … which is why we have State Tort Claims Acts.  While this suit is not posited as such, you get my drift.

While this is a blatant challenge to the State Bar’s right to mandate that attorneys belong to it so that if they “step outta line, the men come and take you away” (to quote Buffalo Springfield) … remember the chorus to that song?  It just got replayed in your mind … I see this thing settling out of court with the Bar agreeing never to do that again.  However, what if there is retribution against all the attorneys who brought these actions?  What then?  Where does it end?  Why shouldn’t every State Bar across the land be prevented from engaging in political speech?

Politics has become embedded within our entire judicial system!  If it wasn’t, we wouldn’t have judges with “agendas” that refuse to hear the truth about “whether we made a mortgage payment or not” or “Are you in default?” (as if we’re supposed to know what the term default means).  Half of you out there think that the term default means you didn’t make your mortgage payment, but as the saying goes, “That ain’t necessarily so!”  That WORD has political undertones in today’s foreclosure courts because it gives judges impetus to throw it around like confetti and use it to kick people to the curb with no proof that a default actually occurred … all the judge has to do is to get the borrower to admit he didn’t make his mortgage payment … the WHY doesn’t matter after that.   And the judge just stepped in and did the bank’s attorney a big favor by helping him win his case!  It’s no wonder that in the criminal realm, 92% of all convictions come out of the mouth of the accused!

And here I thought that by disciplining your children, teaching them right from wrong, could be considered “practicing law”.  Now, the system hangs you out to dry for child abuse for even swatting your kid on the behind in public for inappropriate behavior.

This is where conservatism and liberalism have ruined America.

 

 

 

 

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RISK MANAGEMENT TAKES SO MANY FORMS

(OP-ED) — The author of this post is a consultant to attorneys on matters involving chain of title, foreclosure matters and matters involving in “the system of things”.  None of  what you’re reading here is anything but common sense, not legal or financial advice … and a matter of fact explanation about how one manages risk!

PROFESSIONAL LIABILITY IN A LITIGIOUS SOCIETY

If “the system of things” teaches us anything, it would be what the legal costs would be for having to defend a professional negligence suit … anywhere from $66,000 to $250,000.  If you have to retain an expert witness to testify on your behalf, fees could run has high as $10,000 … all this over about a two-year period.  That’s two years of hell for anyone.

A lot of these attorneys representing the banks think just because their firm has E&O insurance, they have nothing to worry about.”   That’s what they think.

Again, we think of professional liability carriers and wonder what exactly is covered under such an event as described above.  Professional liability insurance places the law firm under a microscope.  Insurance companies are by nature risk averse and so they’d be reluctant to insure anyone with a propensity to commit statutory or ethical behavior on an ongoing basis for which the insurance carrier would have to pay a damage claim for harm caused by the attorney.

Remember in previous posts, I mentioned how insurance companies became so filthy, stinking rich?   They avoid paying claims on cases at all costs.  They invest in things that will bring them a maximum rate of return and shelter their profits inside of real estate and other wealth-building mechanisms.  But they will look to shave off dollars paid out in damage claims by settling for a lesser amount to keep more of what they make.  I don’t mean to irritate you with more “facts”, but that’s the nature of the beast.  This is why I wrote the ten-part series on “Gutting the Underbelly of the Beast”.   Professional liability insurance, of which errors and omissions falls under, is there to help manage risk.

IT’S TOO BAD HOMEOWNERS IN THE NEW MILLENNIA WEREN’T RISK AVERSE 

If homeowners (as borrowers) would have taken that to heart long ago, we wouldn’t be in such a mess nationally.  The rate of foreclosures wouldn’t have been so damned high.

It’s sad that we’ve been so conditioned to want everything “sooner than later” and “more of it than less of it”.  We’ve been programmed to have feelings of “entitlement” … to reward ourselves handsomely for a job well done.  Hell, even Presidents of the United States have gone on TV and told us that we deserve the American Dream at a time when credit was plentiful and anyone could virtually buy the home of their dreams.  With the Glass-Steagall Act being repealed, the banks became sponsor-sellers, the MERS® System took root and the end result was bad banking behavior which fueled the 2008 crash.   It fascinates me that Wall Street would assume so much risk without first figuring out how to manage it.  I’m talking about mortgage loans, student loans, car loans, payday loans, installment loans to buy appliances … and we’re not even touching credit card debt yet. Much of this debt has been securitized.

Student loan debt has now replaced mortgage debt as the number one crisis in America!   Student loan debt collectors have become more unscrupulous in dealing with consumers.  Baby boomers over 60 years of age are financially liable for $66.7-billion worth of student loan debt (whether co-signed or originally taken out to finance their own education).

I used to clean up people’s credit for a living.  My success rate was 85% in removing negative trade line items from people’s credit reports.  I decided to write a book about it: The Credit Restoration Primer.  It was the first of many books that explained how the credit system works and how credit bureaus are governed by law to make sure your credit reports are accurate.

WHAT WE LEARNED IN PRINCIPAL ISN’T PRACTICAL

Mom and Dad always told me that if you want something bad enough, you save up and pay cash for it.  Right?  Radio talk show host Dave Ramsey promotes debt-free living.

But wait!  The world won’t wait for me to save up for a house!  Right?

By the time I save up enough money to pay cash for a house, prices would be so inflated I couldn’t afford to pay cash.  Plus, I’ll be a retiring. (the afterthought)

Once health issues set in, it will be too late to take care of a home. It wouldn’t be advantageous to pay cash for a house in the future while I’m throwing away money on rent (paying someone else’s mortgage) while trying to save on my own terms just because mom and dad told me to avoid debt whenever possible. (just looking at semi-rational scenarios)

But wait!  Mom and Dad worked like slaves to put food on the table and seemed to be doing okay.  Or did they?   Look at their outcomes.  Work for the Company Man.  Get a gold watch. Get a kick in the ass (out the door, to old to work when we can find younger people to replace you at less cost) and then retire, get sick and die.   The “get sick” part is where the family again struggles to make ends meet while coping with huge medical bills because of lack of health insurance or high deductibles.

We’ve taken from what we’ve learned and decided that based on current data, we’d be better off in debt.  How crazy is that?  The banks and credit card companies would just love it if you got yourself in head over heels in debt.  They’re rich and you’re broke.  Yes, you may have “stuff”, but you’re broke!

BECOMING RISK AVERSE IN A SOCIETY THAT PROMOTES DEBT

Whether you like it or not, the Age of Entitlement is upon us.  We have nice things because we want them, no matter the risk in obtaining them.  We cannot become financially successful without a plan.  Then again, there are some that are just happy being able to make ends meet.  But it’s never enough, is it?  You always want what your parents had and then some.

The media is guilty of putting ideas in your head.  Ideas that promote debt. We allow it to permeate our thought processes because it expands our comfort zones and makes us feel better.  We have become programmed to make bad decisions because we “want it now, not later”.  Lacking legal and financial education seems to have been a deliberate thing, despite the fact the government keeps telling us it’s budgeted money to educate us in certain financial matters (like the money appropriated for “education” under the new Fair Credit Amendments Act in 2003). Where was that “education”?  I sure didn’t see any of it.

Why didn’t they teach “Checkbook 101”, “Mortgage 101” or “Student Loan 101” in high school?   I personally didn’t learn too much in civics class.   Maybe my teacher really didn’t give a shit whether I learned anything or not.  In high school, it’s all about the annual test scores and nothing else.

In the land of plenty, why are so many people starving?  Why are there still homeless people?  Have our principles simply been ignored?

Being homeless or without food presents a personal safety risk.  Thus, the government steps in and has the answer: Welfare, Section 8  housing, homeless shelters and food stamps!

But wait!  You have to fill out a form, giving Uncle Sam all of whatever personal information you can give, so the government can build a database with you in it.

The ideas that run through your head when it comes to food, water and shelter involve risk management (believe it or not).  If you can’t plan for a rainy day, why take the risk?  There’s always welfare.  Someone has to pay for it.  Let’s all have a pity party while we figure out who.

We have a government that writes checks its body can’t cash.  Our national debt is into the trillions.  Every time a new budget gets passed, a huge chunk of it is “pork”, so politicians will keep getting re-elected to keep the special interest groups that got the “pork” benefits happy.  This is the Congress that is bought and paid for by lobbyists, like those who work for Fannie Mae and Freddie Mac.

Our government has set such a wonderful example for us, hasn’t it?  Congress can’t balance its own budget, so why should we?

Spending makes us feel better. People get all emotional over colors, floor plans and styles, they forget practicality and price. To top that off, many buy over budget because they think they can afford it.  Prior to the 2008 crash, people took out risky loans, most of whom could never repay them. Many folks allowed the lenders to inflate their earnings so they could buy more home, which was a great disservice.  I’m not saying it’s all the homeowner’s fault.  The lenders played right into the game, offering predatory loans which were risky in an already unstable, credit-saturated market.  The teaser rate was merely a game played by unscrupulous lenders on uninformed borrowers who wanted their piece of the American Dream, only to find themselves on the street years later.  Our government promoted all of this and America bought into it.  Congress repealed Glass-Steagall through the Gramm-Leach-Bliley Act. It was a bipartisan effort.  No one but the banks knew how they were going to use securitization to “rig” the economy.  Notice how the government hasn’t put any of them in jail?  Our executive branch is supposed to enforce the laws that Congress makes.  Why did we forget that?  Why wasn’t that drummed into our heads in high school?

Do we chalk up our current system of behaviors due to lack of knowledge?  It’s no wonder insurance companies are rich.  They avoid risk.   Why aren’t we doing that?

CERTAIN WAYS TO AVOID RISK (MY PARTIAL LIST … TAKE IT FOR WHAT IT’S WORTH): 

(1) Research your planned purchases BEFORE you spend money!  See if you can get products that are either more durable or have a longer shelf life.  America has been so conditioned to mass produced products we’ve become a “throw away nation”.  We’re already seeing difficulty in America in disposing of trash.  Spending a little extra for something that has a longer warranty or shelf life is more prudent in the long run. If you have to use credit to buy that item, make sure it fits within your budget and have a time frame set in your mind (and on paper) on when you intend on paying it off.

(2) Investigate all insurance policies BEFORE you invest … and don’t over insure!  Compare policies.  The last policy I got didn’t cover that much in computer replacement in case of a lightning strike, so I upgraded my policy for $204 more to cover replacement of ALL my computers in my home.  Sometimes, not having ENOUGH insurance puts you at risk … and, in the alternative … sit down and total up all of your policies’ annual premiums.  If you’re paying more than 10% of your income on insurance, you’ve bought too much in policy benefits (or you bought a policy that doesn’t fit your current needs).  It’s like buying whole life insurance policy when pure term is cheaper and you can gage your financial position based on your age and what your current needs are and not get killed financially by changing face value amounts.  Having insurance is part of managing risk.  When homeowners default on their loans, hazard insurance is the first thing that gets cancelled for non-payment of premium.  This is why I pay annually.  It’s cheaper and you have a definitive date to plan for, so your risk is calculated.  General liability insurance on the average runs $350 a year!  If you’re going to protect yourself against high-risk situations, it’s a good thing to have.  I’m not a big fan of homeowners’ indemnity policies.  They essentially insure nothing and with MERS around, shit happens.  There’s nothing like buying a piece of real estate with a tainted MERS mortgage somewhere in the chain of title.  You never know what the future holds if your home’s fate is in the hands of some unknown REMIC.

(3) Avoid impulse spending!  I go shopping just to see how informed the clerks are.  I will rarely buy anything unless I absolutely need it.  This type of buying is especially true in grocery stores.  Why do you think they have food samples for you to try?  To get you to buy extra!  If you have a frustrating time buying groceries and stretching your family’s budget at the grocery store, you have no business going out to eat (because you’re frustrated with high grocery prices) and you’ve probably succumbed to the grocery chain’s slick marketing campaigns.  The stuff they WANT YOU to spend extra on is always in the middle of the aisle or on the end caps.  If you have to take your kids shopping with you, make them go into the check-out lane BEFORE YOU and make them watch the clerk load the cart to make sure nothing you bought was missed.  That way, you give them something responsible to do and they’re not basking at the candy racks at the checkout counter and bugging you with “I want! I want! I want!” overtures.  Hey!  They learned this conditioning on television.  It’s called cartoons (advertising targeted at children in between the cartoon segments).

(4) Plan your educational expenditures by properly planning your career move! Many folks went to college and majored in stuff that had no career future.  They went to school and took classes they liked and spent a fortune (in student loan money) over-educating themselves in foolish majors (like forestry or liberal arts, for example).  It’s one thing to double major in horticulture and business if you’re going to manage a food production facility (like a farm, poultry or egg production or similar skill set) or work for a Fortune 500 company with a guaranteed paycheck.  But wait!  There are risks there too!

First, there is no guarantee that you’re not replaceable!  The first time you make a sexist remark in the workplace, you’ll be labeled a target of some political movement that is responsible for polarizing America.  You’ll be shamed.  This is what you have to look forward to in the national workplace now.  Everyone’s got a political opinion. Everyone’s got Twitter.  Everyone’s got Facebook.  Everyone’s got Instagram. Ask Anthony Weiner (who’s getting out of jail soon) what the consequences are of putting sexually explicit pictures on your phone and sending them to someone.

Second, if you’re nearing retirement age, but have great experience factored into your work history, you can bet the company will be looking for someone younger with much less experience that they can pay less of a salary to.  This posits a risk in this day and age.

Third, there are unplanned illnesses.  You know your body better than your doctor does.  If you have health issues, get them fixed FIRST before embarking down the path to a new career.

(5) If you have to retrain to get out of being unemployed or underemployed just to stay afloat … research self-employment FIRST … then the skilled trades! 

Anything involving food, water, shelter and personal welfare (medicine, nursing assistant, dental assistant) are the BEST career moves NOW.  I know for a fact that my kids are not like me.  They do not have the discipline to be self-employed like I am. I always told my kids to work off the “trade side” and go to a short-term facility that offers grants more than student loans.  In the alternative, attempt to get a job in a trade that is willing to train you while you work (OJT).  True, it doesn’t pay much but the gains from improving your learning curve far outweigh the temporary disadvantages. If you’re going to have to take out a student loan, put a limit on what you’re willing to borrow.  The average student loan debt in America at present is $30,000!  That means, if you can stay at the lower end of that curve, say, $10-15,000, you’ll pay it off in less time.  But you’d better have a job lined up (or at least research enough to know there will be a job in that career path for you) when you graduate.   Paralegal certificates are easier to get these days and there are certain parts of the legal field where jobs are plentiful for lower-echelon workers.

Again, I like self-employment better.  I can work from home and be a consultant when I want.  I can do seminars when I want … or not.  I can work as much as I want or as little as I want.  Every day however, I’m up by 6 a.m. doing research for an hour or so!  Old habits die hard.

I had fun as a mobile DJ.  I made good money too and didn’t have to spend a fortune on equipment.  I rented someone else’s gear first.  When I got enough to buy my own gear, I continued to rent the gear for another DJ to use and over time, I was able to put 28 DJ’s to work and make damned near a six-figure income! That was in 1983.  Imagine what self-employment could do for you and research all of the possibilities.  In some trades or skills, you can rent what you need before you have to make a commitment to purchase stuff.

Avoid franchises!  I know … they look attractive, but there’s a hefty price tag and a huge commitment to follow their schools of thought, whether they work or not.  This is why they put ads in entrepreneurial magazines, to snag the ignorant who are attracted by their teasers.  If you don’t have a couple of million bucks lying around, you’re not going to be able to get into a McDonald’s franchise or a Hooters franchise or any other franchise you think is sexy or at best attractive.  A lot of people like to compete with Starbucks and open coffee shops or coffee carts.  Not a bad living.  Any kind of food cart is a cheap date, but you’ll face local licensing issues and potential consumer issues (conflicts on the street, hold-ups, shoplifters, etc.).

My mom had her own news stand inside the Rochester Gas & Electric building for a number of years before she passed.  It was a safe environment (there was a security guard in the lobby near where her stand was set up, inside a rented nook in the lobby) and she made a modest living and did well despite renting a studio apartment (unfortunately, she never had the opportunity to own a home).  She never got a college degree.  Back then, you just applied yourself.  But the work ethic has changed and so has the marketplace we live and work in. People seemingly care less about the end result (doing a good business) so long as they get a benefit from it (a paycheck with no commitments).

Self-employment is the “new shit”!  Set up an LLC or a full C-Corp. I don’t know if you knew this or not, but the IRS audits full corporations and LLCs less than self-employed sole proprietors.  LLC’s (I’m told by several credible CPAs) get up to 75 deductions a year, while sole proprietorships only get 35 deductions annually.  Full C-Corps get up to 350 deductions per year!  Put your personal property and your homestead into separate trusts as part of asset protection to guard your investments.  Being a consultant or an investor is NOT a bad thing, especially with the right training.  I spend a ton of time researching other people’s careers to determine their longevity.  I can look at a credit report and tell a lot about the consumer (how leveraged they are).  They may have a great cash flow and credit that sucks.  That tells a lot about how they manage risk (0r don’t).  When you can get to the point of investing in other people’s projects (with them doing all the work), then you’re really on top of your game!

(6) Learn to construct a financial statement!  There are FREE classes both online and offered by community colleges and libraries that will teach you how!  Once you know HOW to build a financial statement, you can then figure out what kind of a budget makes you more attractive to expand your horizons. It takes less than a day out of your schedule to learn how.

(7) Do NOT buy vacant land unless you intend on a pre-planned build job! There’s nothing worse than buying a vacant lot (and overpaying for it) only to find that you’re about to get hit with high sewer assessments or increased property taxes due to an unforeseen annexation.  Don’t buy land in flood plains!  I don’t care how glamorous the lot is.  If you’re going to buy, buy in secure areas with a home-building plan.   I actually acquired a 3/4-acre tract and put a used mobile home on it from a lot I bought through the Texas Veterans Land Board for $75 down and made payments on both until the timing was right to sell the 12-acre parcel.  I ended up with a $222 a month land payment and a paid off mobile home, which I fixed up and later made a $27,000 profit selling it.  In the process of selling the 12-acre lot, which was soon to be adjacent to a major toll road, I paid off $35,000 worth of debt!  Being mortgage free is wonderful.  I wish everyone in America could experience it.

Land purchases are great if you have a definite plan to build.  Getting suckered into development purchases is penny-wise and pound-foolish!  Avoid HOAs!  Research chain of title to make sure there’s no restrictions on the lot you’re going to buy and that the title is clean.  If you can buy 5+ acres, owner financed, even better.  You can put a used mobile home on it and build as you go.  A lot of people are doing that these days.  I would do it again if I had to (in a heartbeat)!  You can put in a garden, a well and eventually solar panels … and live off the grid.

AVOID buying second or vacation homes! I know this goes against the grain of you overachievers out there that think you deserve everything. Part of the problem is, second homes or vacation homes is nothing but an equity builder and equity is “fake” until realized.  Many people rent out their second homes but with this creativity comes more legal restrictions. I just don’t like tying up money you could use to really build wealth owning a business.  If you’re going to plan your career, look at self-employment and design your home purchase in an area as your principal residence that doesn’t have to support your business in order for it to survive.  Truck farming is another creative way to stay “under the radar”, eat well and have plenty of fresh, healthy fruits and vegetables left over for bartering.  Farm organic (but don’t advertise it … it raises an FDA red flag and subjects you to scrutiny). I’ll write another book about “being invisible” at some point.

From the investor’s perspective, forget the idea of a second home or a vacation home.  Build a rental income portfolio by investing in distressed properties that you can rent out and make a decent return, while making the bank payments.  There are people with money that have crappy credit, so option payment financing puts instant cash in your pocket you can use to buy another property or fix up your own place or pay down debt!

I know a couple that started out with a mobile home on 8 acres. They originally purchased a mobile home.  They put up a garage and pens and she got her veterinary assistant’s certificate (short term skill training) and got a business license to open up a kennel.  They eventually managed to build their mortgage-free home from scratch.  Yes, it took time, but the rewards were realized in the profits they made from their home-based business!  Ah, the peace and quiet of country living along with the security of knowing you’ll have lots of barking dogs to warn you of unwanted intruders!  I know that a lot of you aren’t cut out for that kind of work, so I posit this as a creative example of “putting your mind to something” to have a working investment.  Credit card companies are throwing credit card applications at these folks because they have cash flow.  They are credit resistant though, because they’ve budgeted and saved for a rainy day, mixing old school principals in today’s modern times.

(8) Say “NO!” to MERS mortgages!  Getting a loan that you know is going to be securitized is crazy because with the digital age, you’re putting your whole future at risk.  Your chain of title is going to ride on someone else’s say-so! You don’t want an electronic database involved in your life any more than you’d want your mother-in-law calling every other minute to query where you’re spending your next dime!

(9) Bank with public banks and credit unions!  Only go with banks that portfolio their loans (meaning they hold the loan in their own vault) and don’t sell them to any entity outside of their own bank!  If the bank is a member/subscriber of MERS, go somewhere else.  You don’t need to support these mega corporations any longer!  Generally, the credit unions give you savings accounts and additional protections that the mega-banks take for granted (when they’re taking YOU for granted).  AND … DO keep cash on hand.  I recommend at least $500 for every person in your household.

(10) Consolidate and pay down on credit cards!   Close the ones you hardly use, have high interest rates or hit you with annual fees.  Unless there’s a real purpose for having a department store credit card … those cards should be the FIRST cards you get rid of!  All your other plastic will work in those stores.  I take issue with these low-dollar credit campaigns like Macy’s and JCPenney’s do as a means to get customers. It’s not worth the hassle of applying for a $300 credit limit just to get a deal on buying one item or saving money on your initial purchase.  You’ll have an inquiry on your credit report, which could bring down your overall credit score.  It’s too easy to forget paying on cards with really low balances, which could jack up your credit score when you least expect it. I find keeping a credit card available for travel or emergencies is the most prudent, don’t you?

TEN WAYS TO “CLOCK” YOUR OPPONENTS UP SIDE THE HEAD! 

Read the 10-part series on this blog: “Gutting the Underbelly of the Beast”!

That way, you’ll learn how “the other side” manages risk.

Listen to this author (Dave Krieger) on City Spotlight-Special Edition, every Friday night at 6:00 p.m. Eastern Time on WKDW-FM!  Get the latest financial news and education!

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THIRD U.S. CIRCUIT ISSUES PRECEDENTIAL RULING IN FDCPA CASE AGAINST MCM … REVERSED AND REMANDED!

BREAKING NEWS — OP-ED — 

This ruling just out of the United States Third Circuit Court of Appeals:

CLASS ACTION SUIT REVERSED AND REMANDED FOR FURTHER PROCEEDINGS! 

Schultz v Midland Credit Mgmt Inc et al, 3rd App Cir No 17-2244 (Sep 24, 2018)_Precedential

Midland Credit Management sent Robert and Donna Schulz separate dunning letters which misstated the rights of the debt collector in reporting a forgiveness of debt as required by IRS regulations, which only applies if the debt is over $600.

The FDCPA (Fair Debt Collection Practices Act) specifically prohibits a debt collector from using “false, deceptive or misleading representation in connection with the collection of any debt.” 15 U.S.C. § 1692e

The District Court had jurisdiction, but as many U.S. District Court judges do, they favor debt collectors and not debtors and often rule against the debtors, misinterpreting the law or in the alternative, the intent of the law.

The 14-page ruling is an educational tool for both litigants and their lawyers.  Understand that MCM knew or should have known better.

This is also a clear and classic example of a STATUTORY VIOLATION as described in the 10-part series GUTTING THE UNDERBELLY OF THE BEAST!

Also, read the footnote on Page 8, where “multiple discharges of indebtedness of less than $600 are not required to be aggregated.” 26 C.F.R. §1.6050P-1(a)(2).  That means that the debt collector can’t total up all of the separate debts (even if they add up to more than $600) and use language in their communication to the debtor which violated the foregoing statute or code. Debt collection, as imparted and regulated by the FDCPA, sets specific standards for what constitutes a violation of statute.  Understand that the FDCPA provides a remedy, at law.  The federal court has jurisdiction because the law is a federal law.  There are state debt collection laws that could have been cited in the federal case along with the FDCPA and the Court would have had to apply the applicable State Laws to the case as they were intended by the legislature to be followed.  When this doesn’t happen at the state level, we have appellate courts to do our bidding.  Just because the judge misinterpreted the law doesn’t mean he should be taken off the bench.

The system of things only applies to his removal if he does something morally or ethically egregious that cannot be resolved by anything other than attacking his bond for provable damages.

I don’t care if he’s a senior judge, like a lot of them are on the federal bench.  Also take to heart that the attorneys litigating FDCPA claims these days like to do class actions because there’s more in it for them in attorney’s fees.

However, also note that the special witness in the class action (the Schultz’s) could get up to $25,000 for their testimony in leading the class action.  Think about that in part when you apply “the system of things” to statutory violations!

Stay tuned for PART 10 of GUTTING THE UNDERBELLY OF THE BEAST!   It’s sure to be a doozey!

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5TH U.S. CIRCUIT MAKES IT CLEAR … NO FREE HOUSE! MERS RULES!

(BREAKING NEWS – OP-ED) — 

The author of this post is not an attorney and therefore cannot render legal advice.  However, he believes that everyone reading this post can clearly understand the intentions of the 5th U.S. Circuit Court of Appeals.  It doesn’t take an Einstein to figure out the blatant meaning behind the Circuit Court’s thinking here.  As an Op-Ed piece, I would think the Burke’s counsel needed to approach the assignment of deed of trust to Deutsche Bank (who I refer to hereinafter … and not lovingly … as Douche Bank) National Trust Company, as Trustee for a REMIC that was empty in the first place!  The courts still do not “get” this yet; thus, we have a ruling that is holding the lower court’s feet to the fire (the lower court may have gotten it right).  Here’s the case for your review:  DBNTC v Burke, 5th App Cir No 18-20026 (Sep 5, 2018)

NO ONE CHALLENGED FULLY CHALLENGED THE DOCUMENT! 

For a number of posts since the McGinnis case was brought up, I’ve been talking about the assignments. I am not totally sure that the Burke’s lawyer was up to speed on any of what I’ve been talking about, but if we were to look up the assignment in question, which the lower judge took issue with, we could pick it apart, piece by piece … and figure out how and why Douche Bank went to federal court to get the result it did, when home equity lines of credit in Texas start out as Rule 736 motions (the cheapest way for the lender’s servicer to steal the property in any Texas state court).  Once you’re done consuming the contents of the 6-page ruling, you can decide where the “manifest injustice” really is!

You see, the Burke’s probably had the funds to fight this the right way.  How and why they didn’t plead or properly attack the assignment is beyond me.  Why they didn’t attack MERS’s “beneficial” interest is beyond me too, because Restatement of Mortgages (Third) § 5.4 clearly does NOT fit Mortgage Electronic Registration Systems, Inc.

However, if you look at the bad case law set by the suit against MERSCORP in the Southern District of Texas, the Burke’s arguments fall short of a “win” (which is not what was desired here).  Instead, from all appearances, the lower court (Judge William Smith, U.S. District Court, Houston) justice got into a pissing contest with the 5th Circuit over the validity of the assignment.  In order to fully comprehend what’s happening there, you’d have to pull the law of the case on the subject (which I did) … see it below:

DBNTC v Burke, U.S. S.D. Tex No 4-11-CV-01658 (Sep 16, 2014)

If you notice the numbers on the case, it’s been going on since 2011.  I would suspect it’s been going on since the “suspect” assignment was recorded in Harris County, Texas and Douche Bank and Ocwen (who was the servicer in that case) “manufactured” the document with the intent to steal the property.  The problem is, the Burke’s put an Affidant forward to the Court from a “Chief Fraud Examiner” (Charles K. Lamm) … hmmm … who died and made him chief?   Mr. Lamm’s affidavit was excluded because he was NOT allowed to be an “expert witness” at trial.  Another presumptive mistake by the Burkes and their counsel.  Again, as I spoke of earlier in the articles GUTTING THE UNDERBELLY OF THE BEAST, the first mistake was allowing this case to proceed in federal court, where the homeowner and his attorney have minimal control over the foreclosure, especially where any form of “MERS” is brought up.  You also have to look at “the times” (the period in our history of litigating against any MERS entity) … that things have come about in a different way, which has resulted in virtual conflict among the States of the Union as to whether any MERS entity has any right to claim itself as anything, when Restatement of Agency (Third) was clearly brought into the equation.  I bring you the screen shot from the case to discuss the importance of understanding WHY I’m talking about what constitutes an “Expert Witness” and proper discovery to bring about the desired results within “the system of things”, even if it comes to an unfolding scenario in federal court (an obvious ongoing fight for what appears to be over 4 years):

NO EVIDENCE … NO RULING IN YOUR FAVOR! 

If you’ll notice in the foregoing screen shot WHAT the Court said is that there is NO SUPPORT FOR THE EVIDENCE SUBMITTED!  Further, the Court pointed out that NONE of Mr. Lamm’s documents were authenticated.  That, my friends, is sloppy lawyering.  This was typical for what was going on in the courts around this country (and probably still does occur) at the time because people still haven’t gotten past the emotional state of running into court and screaming “FRAUD!”, expecting to get results in their favor, with no discovery, no depositions and no live testimony from a proper expert witness.  What “personal knowledge” could be gleaned from Mr. Lamm, as all he did was examine documents he had nothing to do with creating.  Where were the depositions here?  I don’t see any mention of them anywhere within the 4-page Order of the lower court in 2014, do you?   What the hell were these litigants thinking?   The same thing many homeowners think when they see what they believe is a “suspect” document.  They hire some self-proclaimed “chieftain” to analyze their document and tell them what they want to hear, with no evidentiary support to back it up … and definitely … no personal knowledge of anything.  This pattern has followed many a homeowner through unsuccessful foreclosure processes all over the U.S.   I guess people have not awakened to the principles of the Rules of Evidence yet.

IN SOME STATES, GOING AFTER ANY FORM OF MERS IS A BIG WASTE OF TIME AND MONEY! 

Unless money grows on trees and you have such a tree growing in your yard, or you live in Tennessee (where the Ditto decision gutted MERS like a chicken), whatever State you happen to be in (in this case, Houston, Texas), the courts are split on what MERS is … and what MERS isn’t.  It isn’t just in the federal circuits … it’s in the state courts too.  A lot depends on what legislation was promulgated (and by whom) to get “nominees” into the mix within the county land records, which in turn decimated the county’s earnings directly because of HOW the MERS® System works.

The only way I see this coming to a finite end is to “gut the underbelly of the beast”, where the beast least expects it.  This case serves as an underlying reason why “the system of things” has to work the way it was designed to work, NOT the way you think it should.

This is done by going after the attorneys for the banks and their servicers and holding them liable for felony perjury on the court (which BTW can be exerted in either state or federal; however, there is no “money flow” from the federal side, only from the counties that are heavily insured or self-insured) by directly attacking the document(s) involved, which means you have to focus on those creating (manufacturing) them.  If you want to win, there is no getting around this.  If you want to take down MERS, you have to take them down in principle by going after the “users” of the MERS® System and NOT MERS DIRECTLY!  You see, the “users” are all trained liars!

For the rest of the story, see the upcoming post … GUTTING THE UNDERBELLY OF THE BEAST – PART 7.  In that segment, you can learn and differentiate when judges “do the right thing” versus when they don’t.  When they don’t do the right thing … is when the system of things kicks in!

 

 

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