As much as state attorneys general could be an effective force in acting for consumers and investors against banks, the fact that an attorney general has saddled up does not necessarily mean the effort is serious. At a minimum, it might just be a gambit to garner some good PR without seriously inconveniencing the perps; at worse, the action might be a pure Trojan horse.
Consider the curious conduct of one Bill McCollum, the lame duck attorney general of Florida. It appears that McCollum has been going after the foot soldiers in the foreclosure chicanery business (although some of them, like David Stern, head of the biggest foreclosure mill in the state, have earned a tidy fortune). His recent actions have targeted firms offering dubious foreclosure advice, and more recently, the foreclosure mills as well as a firm that may be best known for its real estate related document fabrication activities, Lender Processing Services, through its DocX subsidiary.
Now starting with these actors isn’t a bad thing at all; in fact, prosecutors often target low level criminals with the hope of getting them to turn evidence on the kingpins. And there is good reason to think McCollum has no interest in asking tough questions that will inconvenience bigger fry.
McCollum Is falling in with the banking industry party line. He appears to regard not disrupting the foreclosure process, a top priority of the financiers, as a worthy goal. Gee, isn’t preserving the rule of law and making sure no one is abused or defrauded the sort of thing his office is tasked to defend, not the functioning of markets or the bottom lines of banks? From the Wall Street Journal (hat tip reader f247):
“They’re training a lot of new people, and apparently now they are comfortable with the legality of their foreclosure process,” Mr. McCollum said in an interview. “The primary purpose of these meetings is talking about not having this stuff held back. It’s very important for us to not have a backlog of foreclosures. We already have a backlog. We don’t want it to get worse.”…
Mr. McCollum, Florida’s attorney general, said most errors in the foreclosure process have been “procedural,” adding that his top priority is to resolve the mess in a way that allows foreclosures to resume quickly….
The talks also centered on how to quickly get the foreclosure process moving again, according to the Florida attorney general’s office. Mr. McCollum described the meeting as more cooperative than combative.
Let’s look at the timeline:
August 10: McCollum announces investigation of foreclosure mills. McCollum also happens to be running for governor as a Republican and facing a tough opponent in the primaries. One must wonder whether this investigation was a Hail Mary pass to bolster his candidacy
August 24: Florida primary, McCollum loses to Rick Scott
September 3: McCollum asks if he can resume being a lobbyist once he leaves office. Per the St. Petersburg Times:
Barely a week after he lost the Republican primary for governor, Attorney General Bill McCollum sought legal advice on whether he can lobby the governor’s office and Cabinet — the very people he works with now — after he leaves office in January.
The answer: No.
He’ll have to wait two years before he can collect fees to represent private clients before the state government that has employed him the past four years… He asked the Commission on Ethics not to reveal his name as the person making the inquiry, but the agency did anyway….
McCollum’s Sept. 3 letter to the Commission on Ethics noted that state law and the Constitution already bar him from lobbying his current agency, the attorney general’s office, for two years after leaving office in January….
But because the attorney general also is a member of the Cabinet, McCollum asked “what entities” are also covered by the lobbying restriction.
The attorney general, as a Cabinet member, serves on a variety of boards overseeing the state pension fund, environmental, land use and other issues.
In its opinion, the ethics commission said: “One’s public service career and contacts developed in that capacity should not be used to enrich oneself at the expense of the public (and) the provision was intended to prevent influence peddling and the use of public office to create opportunities for personal profit through lobbying once an official leaves office.”….
McCollum, a lawyer who served for 20 years in Congress, listed a net worth of $1.3 million in 2009. He collects $82,000 annually as a congressional pension.
For several years after he left Congress, McCollum was a $400,000-a-year lobbyist for the Baker & Hostetler law firm.
It’s also worth noting that the biggest foreclosure mill targeted, the Daniel Stern law firm, has hired heavyweight Republicans to defend it. Per FireDogLake:
David Stern has already become fairly well-known to the media as a high-volume foreclosure servicer — a foreclosure mill. What’s not as well-known is that David Stern’s legal representation, Tew Cardenas, is rather important to Florida’s Republican Party. While Jeffrey Tew has donated only on a rather limited basis to candidates, Alberto Cardenas has donated more than $70,000 to candidates, incumbents and committees during the last two election cycles. . . .
Among Cardenas’ beneficiaries are Rep. Roy Blunt (MO-07) and Rep. John Mica (FL-07), who respectively sit on the House Energy and Commerce Committee (Blunt), House Permanent Subcommittee on Investigations (Blunt), and House Committee on Oversight and Government Reform (Mica), and the House Committee on Transportation and Infrastructure (Mica is the ranking member). His family members are likewise generous to Republicans and have donated more than $9000 over the last several years.
Unfortunately, this case study illustrates yet again the dangers of taking headlines at face value.
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This guy made $400k for several years and is only worth $1.3 million? Perhaps government fails to attract the brightest bulbs? No doubt he can find employment in one of Stern’s foreclosure mills. How fast can he sign?
Are you kidding? Do you know how difficult it is to build up $1.3MM on $400k per year after taxes and living expenses? Do you understand math? Most investment assets basically show no gain over the last ten years. Even if you struggle and manage to put away a full $100k of the $400k, do you have any sense of how long it would take to get to $1.3MM in net worth, or are your math skills that deficient?
I’m not crying for this guy, but in my experience, most people earning $400k per year over the last ten years don’t have $1.3MM in net worth unless they were very frugal compared to their peers and very lucky in their investment decisions.
You may be a wizard at math but you clearly know nothing about money, or taxes either if you think these 400K guys pay any.
Having worked in a state attorney general’s office, I would say it’s a good bet that they don’t have anywhere near the resources needed to investigate this fully. State budgets have been steadily cut from 1980s on. One ploy used by those being investigated is to flood the investigator’s office with paper, during discovery, correctly betting that it will be just about impossible for investigators to wade through all the muck to find the pearls. Not saying that’s the case with McCollum, but it’s quite possible.
Some have been exposing this from a while ago. So the all the AG’s need to do is research this site below.
David J. Stern and Cheryl Samons was first exposed back in Febuary
http://stopforeclosurefraud.com/tag/law-offices-of-david-j-stern-plantation-florida-33324/
As was LPS/DOCX
http://stopforeclosurefraud.com/lps-101/
Here is a bit more into MERS
http://stopforeclosurefraud.com/mers-101/
ROBO-SIGNER Depos
http://stopforeclosurefraud.com/depositions/
See not so hard and all that money saved by just these 4 links.
The official line seems like a Reverse Nuremburg defense: “we told the processing flunkies what to do, and they ignored the rules and gamed our variable compensation package. They didn’t follow orders.”
It is indeed time to hold Doug Gansler’s feet to the fire like never before. I am fighting for my property rights and house every day, they will have to take me out in a body bag. I have emailed Doug Gansler many times for help or answers –to no avail, I only got one robo response, not another word. Well Mr. Gansler what do you have in mind for the State of Maryland homeowners?
Awful, just awful. Doug Gansler needs to get on it in Maryland – there are areas that are just bombed out in this state. Everyone seems to know perfectly well what happened, particularly with Fannie Mae, big banks in Maryland just gave away loans designed to fail. Particularly disgusting is the “rescue” of Chevy Chase Bank by Capital One. Crooked bank managment claimed their TARP handouts (and other benefits) had nothing to do with their decision to buy Chevy Chase. Chevy Chase was using deplorably lax standards in collusion with and provided by, Fannie Mae, grabbing the cash, looting and setting fire to their own bank.
Yves,
You are absolutely right about the Florida Attorney General. I am hoping that there will be at least a few AGs that are more motivated plus the MBS investors plus the foreclosure defense attorneys that together will create a big enough breach. Else the empire wins again. I feel that Darth Vader is a very appropriate representation of Obama as will be documented in the prequels some time in the future.
Yves, thanks for amplifying. McCollum’s quotes in that article are ridiculous. It doesn’t seem like the FL AG’s office was doing anything whatsoever since announcing the investigation last spring, at least until this became a national issue and the spotlight was on them.
At least the OH AG is *talking* like he won’t sweep this under the rug:
“‘If financial institutions are trying to laugh this off … by trying to dismiss the 50-state investigation as motivated by politics and going to somehow evaporate 10 days from now, then they are not addressing the seriousness of the situation,’ [the OH AG] told Reuters.”
Yves,
Many thanks for your zeal in pursuing the truth. I feel that I now understand the story, first with the enriched local mortgage company that typically gouged the prospective home buyer, then with the handoff to a national bankster (after paying more points to the mortgage co.), then with the national bankster selling the mortgage to Fannie or Freddie (through MERS), then the original note is discarded because MERS cannot hold or own anything (show me the note), then the bundling by Fannie or Freddie with commissions paid on each end when they are turned over to the banksters once again for selling to the suckers (investor tranches). The banksters have little incentive to report how bad the loans are because they have also placed bets that the loans will default.
Meanwhile, back at the tranch, no loans are assigned to investor tranches because they have to default first to determine which tranche it is assigned to. This failure to consummate the sale violates the rules (New York State) that the investors require to maintain favorable tax treatment. These investors will be required to “payback” the tax gains.
I am not clear about the most important point. Why would the title companies go along with this when they would have been the first ones to realize that the original notes were no longer existant? Were they paid large fees to provide fraudulent “title” work? Larger fees for filing fraudulent assignments?
The title companies had to be complicit for this schemer to work for so long.
If we Americans refuse to fill our prisons with the dung heap of the mortgage fraud crooksters, what is the value of our justice system?
Someone called their office, had her foreclosure criminal documents with full explanation supporting assertions, not interested, no call back, no contact. This a month ago. So it goes. The soul of a nation lies wounded, yet some politicians, either don’t get it or are still stuffing their pockets with free money. But rest assured those who are in powerful places and refuse to uphold the law will be open to unique lawsuits.
I suspect much of the talk around foreclosures these days is driven by the upcoming elections. The revelations of fraud combined with the discussion of foreclosure moratoriums have people confused about what they should do. In my opinion, it all comes down to whether borrowers will take individual action, assuming they haven’t been bled dry financially. We can’t expect the AG’s, or anyone else in an elected position, to ignore their own self interests.
Christine Springer is absolugtely correct — yes it all does come down to individuals takking action. All you have to do is surt the web for nlo less than 15 minutes to find out. There is a ground swell of MAD AS HELL AND NOT GOING TO TAKE IT citizens on the move. I refuse to be ripped off. The ink was not even dry before it was chopped up and sold as securities. You see there never really was a “loan” it
Christine Springer is absolugtely correct — yes it all does come down to individuals takking action. All you have to do is surt the web for nlo less than 15 minutes to find out. There is a ground swell of MAD AS HELL AND NOT GOING TO TAKE IT citizens on the move. I refuse to be ripped off. The ink was not even dry before it was chopped up and sold as securities. You see there never really was a “loan” it
Christine Springer is absolugtely correct — yes it all does come down to individuals takking action. All you have to do is surt the web for nlo less than 15 minutes to find out. There is a ground swell of MAD AS HELL AND NOT GOING TO TAKE IT citizens on the move. I refuse to be ripped off. The ink was not even dry before it was chopped up and sold as securities. You see there never really was a “loan” it
Christine Springer is absolugtely correct — yes it all does come down to individuals takking action. All you have to do is surt the web for nlo less than 15 minutes to find out. There is a ground swell of MAD AS HELL AND NOT GOING TO TAKE IT citizens on the move. I refuse to be ripped off. The ink was not even dry before it was chopped up and sold as securities. You see there never really was a “loan” it