If the mortgagee (the borrower) files bankruptcy, someone has to prove they own the note, and has to prove exactly how much is owed on the note. The process is that some one who thinks they own the note files a proof of claim, and a motion for relief from the automatic stay. In both, they are essentially swearing that they own the note. The Trustee examines the documents submitted with the proof of claim or the motion. You would just laugh (or cry) at how many of them don’t prove anything about ownership. One problem is that the allonge is endorsed in blank. Another is that the note just isn’t there. A third is that the note is endorsed to one person, and another files the proof of claim. There are plenty of others.

Even where the company eventually proves that they own the note, they are rarely able to provide a complete payment history, which is necessary to prove the amount actually owed. In many cases you can find untrue charges tacked onto the payment history or into the claim.

Get away from the big shitpile. Remember to look at the assets of your money market fund.

To make a really, really long story short, the issue in the Ohio case and a couple like it since is not the actual ownership of the loans, but whether the filer of the FC action can prove ownership using the mandated documents with proper date stamps and so forth. The FC actions were not dismissed with prejudice, meaning that the judge will hear them if Deutschbank returns with the correct paper.

Here’s a much better run-down from Tanta at Calculated Risk, who knows from such matters professionally. If you don’t want to get all weedy right off with someone you hardly know, here’s a choice quote Tanta takes from Judge Boykin’s decision:

Counsel for the institutions are not without legal argument to support their position, but their arguments fall woefully short of justifying their premature filings, and utterly fail to satisfy their standing and jurisdictional burdens. The institutions seem to adopt the attitude that since they have been doing this for so long, unchallenged, this practice equates with legal compliance. Finally put to the test, their weak legal arguments compel the Court to stop them at the gate.

The Court will illustrate in simple terms its decision: “Fluidity of the market” — “X” dollars, “contractual arrangements between institutions and counsel” — “X” dollars, “purchasing mortgages in bulk and securitizing” — “X” dollars, “rush to file, slow to record after judgment” — “X” dollars, “the jurisdictional integrity of United States District Court” —“Priceless.”

I gather, Coastal Capital was another one:

Coastal Capital – Mortgage Banker

2007-02-16

No mainstream story, but I have received private confirmation of the discussion found here. No word on what fraction of their portfolio was subprime, nor how large their originations or holdings were.

About the company:

Coastal Capital is a privately owned mortgage banker that was established in June of 1988. There is a diverse family of companies under the CCAP umbrella such as subservicing, collections and our mortgage banking division. We have over 600 employees and are licensed in 43 states and have grown via referrals only through our network of Account Managers and Brokers.

Here is some more background info sent to me by an industry source:

[Coastal] used to be a large East Coast lender, but recently they were only closing around 12 million a month. The owner sold off all his holdings over the last few months. He was indicted earlier this week for his role in the Duke Cunningham scandal. They started going downhill last year when he closed the subprime unit, sold off his collection companies, and his servicing company. At it’s height in 2003 Coastal was closing 75 million a month.

Here is a story on the ties between coastal and Duke Cunningham:

A common thread in the Cunningham case is a mortgage company, Coastal Capital Corp.

Virginia’s Bureau of Financial Institutions lists John T. Michael as the chief executive officer for the Greenville, N.Y.-based company. According to news reports, Michael is the nephew of Kontogiannis’ wife. In an earlier interview, Kontogiannis told the North County Times that his daughter is also a principal in the company. A source close to the investigation has confirmed that Michael is alleged to be co-conspirator No. 4.

The Washington Post also has the indictment of Coastal’s John Thomas Michael.

Yes, I think it’s a likely a case of someone getting caught out doing stuff that was fairly common in the housing bubble of Alan Greenspan’s making, in cahoots with the hedge funds that’ve been buying up all manner of things and turning them into empty eggshells. Mind how you go!

From July 5, 2007:

FBI lacks resources to fight boom in mortgage fraud
2,500 agents reassigned to terrorism weren’t replaced

Mortgage fraud cost banks and consumers at least $1 billion last year, but neither the Bush administration nor the Democratic Congress is giving the FBI the resources it needs to combat the problem, according to an industry group.

http://seattlepi.nwsource.com/…..age05.html

Hmmmm… we had ads all over the Internet for online bank apps, and no one thought to fund more fraud investigators for the FBI? Jesus, Mary, Joesph, and all the saints and angels, how dumb was that?

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marksb, Preview also not working on Safari, but I assume the site is still in beta.

I’m just curious how many of them also have been willing victims of mortgage fraud over the last little while.

Looking at the political cases isn’t the way to figure out–they’re just the ones that get the press.

http://media.www.dailyemerald&…..ailedition

Now is MediaSentry in anyway connected to the larger story of the telecoms- Mediasentry’s task was to do the actual “internet investigation”- any chance they also helped the telecoms with there mission?

RIAA: Recording Industry Association of America

And I found this interesting: ” Meaning MediaSentry may not be able prove that users actually shared the copyrighted data or how the songs were obtained, whether legally or illegally.” Isn’t this the heart of both the telecoms and RIAA- just because your IP address shows activity it is not showing “users” doing anything inapporppriate. Is your IP address YOU?