Tag Archives: standing

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 JOURNEY BEGINS WHEN THE PITY PARTY ENDS … STEP TWO!

Op-Ed — (continued from the previous post) STEP TWO … 

The Internet can be a dangerous thing, especially when doing research, trying to find answers to questions surrounding a potential financial issue that could become a crisis, like a foreclosure.

One of the reasons why I post blogs is because people share them.  Others who are in despair happen to run across these posts and some of them walk away with reason.  The “reason” I speak of is the need to recognize when there is a problem and the HOW TO’s to do something about it. Being in denial solves nothing.  It simply prolongs the problem.  Sometimes, it makes the problem worse.

The bigger part of the problem is the second issue I spoke of in the previous article: Confusion.  Understanding what is happening in its most blatant aspects is that there is the potential of losing one’s home.  The WHY of it all stems from the alleged lender’s assertion that payments were missed and that the loan is in default.

In mortgage states, or states that are commonly referred to as judicial states, you not only get your “day in court”, but the bank has to actually PROVE that you are in default AND that they hold your promissory note AND have the right to enforce the terms of the mortgage (and note).   In all cases, the mortgage FOLLOWS the note.  The mortgage is a recorded security instrument, which is found in the public record in the county in which the mortgaged property is located.  It contains terms and conditions which must be adhered to in order to keep the note holder from foreclosing and taking their “security for the loan” back.

In deed of trust states, or states that are commonly referred to as non-judicial states, you don’t get your day in court unless you file a lawsuit and demand that the court issue a temporary restraining order (TRO), which prevents the lender (or its alleged servicing representative) from advertising and conducting a sale of your property on the courthouse steps at a prescribed point in time.  The deed of trust is also a recorded security instrument, which operates similarly to a mortgage, and if properly recorded, is also found in the public record in the county in which the mortgaged property is located.

You should know that if lenders had their way, EVERY STATE would be a deed of trust state.  That way, the lenders and their henchmen would have nothing to prove when it came to advertising and selling homes on the courthouse steps.  Until they actually bribe every state’s legislature to change over to non-judicial from judicial, homeowners still have their day in court. This is the only way the banks can win.  Knowing of this potential makes me wonder why people are taking out loans to buy property when, if they know there is a possibility of their financial future turning dismal, they don’t just buy a small plot of raw land and “build as they go”.  This would seemingly make more sense and involve the banks less.

Another reason the lenders prefer a deed of trust to a mortgage is that when examining the 2007-08 financial crisis, homeowners were affected to the point where most in financial straits could not afford an attorney let alone keeping food on the table.  Knowing the homeowner won’t fight back increases a successful outcome by the lender of taking the property back without much hassle.  Now that the Dodd-Frank Act has been molested and degraded to the point of history repeating itself, how many potential homeowners will be sucked into taking out mortgages from the mega-banks, which the gutting of Dodd-Frank was clearly designed to benefit.  You can bet the major lenders had a lot to do with those major changes to the most recent passage of the “Economic Growth, Regulatory Relief and Consumer Protection Act”.  Because these bills are so voluminous and partisan, they create more “confusion” for the average person on the street who didn’t go to law school.

Your “property” has a chain of title … 

Researching your property’s chain of title is like peeling away the layers of an onion.  The more research you do, the more layers you peel away, leaving the real truth on the table, which, after peeling an onion, leaves most people in tears.  This is why I used the “onion” analogy because peeling onions makes my nose run and my eyes water.  Finding out what really happened to you as the result of your being duped by an unscrupulous mortgage loan officer would make anyone cry, especially when they discover that they made a mistake getting that particular mortgage loan in the first place.  And now, you’ve opened “Pandora’s Box” and found the onion.

Accepting the “truth” for what it is … 

During the times prior to the 2007-08 financial crisis, banks and mortgage companies were loaning money to anyone who could “fog up a mirror”, altering mortgage loan applications, baiting loan applicants with teaser rates tied to adjustable rate, interest-only and negative amortization loans and mortgages that looked normal, only to end up finding one got stuck with a balloon note or interest rates that put their monthly payments out of reach of their paychecks.  This was deliberate and calculated.  The banks played both sides of the coin when they lured the investors into the schemes of securitization and lured the homeowners into loans they neither could afford nor deserved.  The first “truth” you need to recognize is whether you’ve bitten off more than you can chew.  Once you realize what the truth is, it makes it easier to come to grips with and deal with HOW the mistake was made that got you into the dilemma you’re in now.  I went through this “dilemma”.  I got stuck with an “80/20 loan”.  That’s two separate mortgages, wherein the second mortgage (the “20”) had a much higher interest rate and was generally tied to another Wall Street security altogether. I used the foregoing phraseology to describe “securitization”.

It does not take an Einstein to figure out that when there’s more month at the end of the money, you’re not making it.  When you’re even one day late on your mortgage payments, the servicer handling your mortgage “red flags” your account and starts a file on you. The servicer is generally looking for excuses to take your home away from you.  No servicer in today’s times is “nice”; in fact, they’re all common liars from time to time, especially those $9/hour cubicle employees who tell you that you have to be 90 days late before you can apply for a loan mod.  THAT IS THE BIG LIE!  The servicer knows that on Day 91, the REMIC’s credit default swaps, default insurance and any other PMI or LPMI that’s been tied to the loan will be negotiated and the alleged “Lender” will reap over 200% profit off of your mortgage loan … and that’s without even applying for the title insurance payout (the principal amount of the loan less 27% administrative costs) because the chain of title is jacked up (due to the Lender’s own ineptness).

The next major ploy of disbelief is the then-servicer (on or before DAY 90) has its employees dummy up an assignment of mortgage or deed of trust and cause it to be recorded into the land records in the county where your home is located so they can “structure” or “manufacture” standing to foreclose.  The term “standing” in of itself intimates that the lender (or its servicer) has the right to do what it’s doing to you. Most attorneys I know assert “lack of standing” in almost every foreclosure defense, because the simple statements of the servicer (who claims to represent the real party in interest) are not sufficient enough to prosecute a foreclosure.

If your loan is in the MERS® System, it is likely to have been securitized, which means that the chain of title is really messed up an there is likely a REMIC (Real Estate Mortgage Investment Conduit), a tax-exempt entity that soaked investors for loan money, who has no idea you’re in default (the servicer knows!) and the servicer comes in disguised as the Lender, retains an attorney, obtains a foreclosure, sells the house post-judgment and runs away with your earnings.  This is why mortgage loan servicers are in business.  You make gobs of money when 95% of the homeowners run away and leave their homes to the servicer and their law firms, who split the booty, post-sale. MERSCORP (in whatever form) and its wholly-owned subsidiary, Mortgage Electronic Registration Systems, Inc. were created to bolster lighting fast transfers of loans electronically, that have allegedly been securitized (paid for with investor money instead of the bank’s own money) and sold and re-sold multiple times on Wall Street.  This can only happen if the loan is securitized.  MERS IS NOT (AND SHOULD NOT BE) USED IN PORTFOLIO LOANS!

If you just understood what I just said … the REMIC does NOT know when you are in default because the servicer is required to make your payments to the investors, even when you don’t.  When people realize this, they get really pissed off because all along they thought it was all their fault.  The “noose” was tightened around your neck when you signed the mortgage loan in the first place!  Speaking of fault … did you come to realize the word “fault” and “default” are similar?  How do you know you’re actually in “default” if the servicer has been making your mortgage payments all along?   This is the “power over” debt collection game they play with you when you’re late on your mortgage payments.  All this time, the servicer has been making the payment for you and you never knew it.

These are only a fraction of the “truths” I teach at my workshops!

Homeowners who think they’ve been defrauded want to sue everyone tied to the mortgage loan.  THAT is the first big mistake that homeowners make.  That’s because their confusion has caused them to become angered (the third phase of foreclosure) for all the wrong reasons, to the point where they lose all rational consciousness in making proper decisions about litigation. Listening to people putting forth information and then acting on that information (without first vetting it just because it supports some sort of rational argument they have in order to make a living steering people down rabbit holes) accomplishes nothing either.  This is why many people become confused. Once they enter the cesspool of foreclosure cases looking for answers, they get so overwhelmed they don’t know where to turn or who to trust.

My research shows me that if the banks and mortgage companies were conniving and calculated enough to pull one over on you at closing, then the obvious objective is to give them their just desserts in return.  “Wise as serpents, harmless as doves.”  Going out and filing big lawsuits against lenders without a reason or any “litigation logic” using that same rationale is futile and fatal.  Why waste your money and your time?  The fact you are being foreclosed on brings an undue psychological burden on the mindset, which in turn induces stress, which in turn affects both your mental and physical health.  This is why 95% of homeowners “run away” and don’t fight.  This is why America can easily be “taken over” by the “party elite”, because most do not know HOW TO fight, let alone WHY.  If you knew HOW TO fight, wouldn’t the WHY develop into something more logical?   This is like taking karate or some other form of martial arts training.  There’s no “false hope” here because you are confident you stand a chance of winning.  You either choose to fight or you don’t.  You can still walk away from a fight and save your mental and physical anguish by formulating an alternate plan (otherwise known as PLAN B).

Everything from taking out the mortgage loan to fighting the alleged “lender” in court has a certain amount of risk.  Some of this risk is calculable.  Some of it is not.   You chose the path you are on for a variety of reasons and now you must choose the right reasons to either run and hide from your creditors or to get educated, stand up and fight them.   Filing bankruptcy only aggravates your struggle and to that end, I will explain that in the next step.

The journey begins with the chain of title … 

There is only one place that you’re going to be able to locate the foregoing and that is in the office of the clerk or recorder of your county records.  These folks get paid to help you search out the necessary documents.  If you live in a rural area with an underdeveloped county recording system, it’s highly likely that you will have to search all of this by hand through the index, which is organized by last name, then first name until you locate the recorded copy of your warranty deed.  This is your proof that title has been vested in you and no one else.

As a title consultant for many years, I can safely say that in most instances, this is your starting point.  You do not need certified copies of everything, just regular printed copies you can scan and mail to others who may have more research knowledge than you.  Getting together with other homeowners to discuss your findings after a visit to the land records may expose you to more research truths, which you need to begin your quest to justice.

You MUST collect the entire chain of title for your property in order to be able to fully analyze it (or have someone else that is more formally trained analyze it).  Skimping to only obtain the first couple of pages of a mortgage or deed of trust is just plain penny wise and pound foolish.  You need to see the whole document to see HOW you got screwed.  The devil is in the details!

Mortgage = Payments until Death  (Duh … “mort” … in several languages, means “Death”)

STAY TUNED FOR STEP THREE!  (I will discuss HOW the chain of title is used to formulate your case for trial!)

For more information on the Foreclosure Defense Workshop, click on the link!

I’m only doing this once this year!

For more information on Dave Krieger’s information library, CLICK HERE!

NOTE: Foreclosure defense attorneys are attending this Workshop!

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