Lender Processing Services LPS and ProVest: Resemblance is uncanny

We all have all got acquainted with LPS and have read about ProVest in connection with Law Offices of David J. Stern. If you take a close look at the two logo’s, don’t they have a resemblance? Look at the colors as well…Hmm are we unlocking another possible link?

 House Flipping Makes A Comeback In Florida Foreclosed Homes Sold On Court House Steps for Cash, David J. Stern Law Office Forecloses Buys and Flips for Profit, FBI Needs to Investigate.

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WTF!!! DJSP Enterprises, Inc. Announces Agreement to Acquire Timios, Inc., Expand Presence Into 38 States

DJSP Enterprises, Inc. Announces Agreement to Acquire Timios, Inc., Expand Presence Into 38 States

Adds Established National Title Insurance Agency with Multiple Locations Across the US for Expansion of Cyclical Products and Services to the Real Estate and Mortgage Industries

By DJSP Enterprises, Inc.

PLANTATION, Fla., April 19 — /PRNewswire-FirstCall/ — DJSP Enterprises, Inc. (Nasdaq: DJSP, DJSPW, DJSPU), one of the largest providers of processing services for the mortgage and real estate industries in the United States, today announced it has signed a definitive agreement to acquire Timios, Inc., a national title insurance and settlement services company. Timios is a licensed title insurance and escrow agent operating in 38 States. Headquartered in Westlake Village, CA, with additional offices in Houston and Plano, Texas, Timios will provide DJSP Enterprises the capability to provide its customers a balanced portfolio of services including new loan origination, refinance and national REO closing and title.  Additionally, Timios handles national loss mitigation services and pre-foreclosure title products from its multiple locations strategically placed for time-zone sensitive fulfillment.

Management expects that Timios, which uses advanced technology to produce a paperless environment, will aid DJSP Enterprises in its commitment to provide its customers with enhanced customer service in all lines of its business as it expands nationally. Timios presently services purchase money, refinance, reverse mortgage, REO and Deed-In-Lieu transactions for some of the largest lenders and servicers nationwide.  Last year, Timios closed in excess of $500 million in residential real estate mortgage transactions, and as forecasted, is expected to more than double the volume in 2010.  In addition, Timios has the capability to complete title searches for DJSP Enterprises’ growing REO liquidation business and loss mitigation business outside of Florida.

DJSP Enterprises will maintain Timios’ three offices while consolidating operations and back-office functions to streamline and reduce expenses.

David J. Stern, Chairman and Chief Executive Officer of DJSP Enterprises commented, “This acquisition significantly expands our capacity to effectively handle national services for our current client base.  In addition it will support our cyclical expansion into other lines of the mortgage services business. In particular, our capacity to process national REO closings, refinance transactions, short-sale transactions, Deed in Lieu transactions, property reports, resale transactions, and multiple valuation products will be meaningfully expanded. Timios provides licenses for full settlement services in 38 states and we expect to obtain licenses in at least two additional states before the end of this year.

This acquisition further demonstrates our commitment to becoming the leading cyclical provider of products and services to the real estate and mortgage industries.”

“This transaction represents a great marriage of strengths and assets,” said Trevor Stoffer, president and CEO of Timios, Inc. “Our management teams could not ignore the obvious benefits to both organizations. DJSP Enterprises’ growth in the foreclosure space and our best in class technology and servicing of originations will create a very balanced portfolio. In addition, the financial support from DJSP Enterprises will allow Timios to grow from a boutique services company to a major player in settlement services with a complete offering for lenders.”

DJSP Enterprises will acquire Timios for $1.5 million in cash, 200,000 ordinary shares of DJSP Enterprises, and up to 100,000 ordinary shares of DJSP Enterprises to be earned upon achievement of defined performance metrics. Timios had revenue of $5.05 million for the last 12 months and DJSP Enterprises expects this acquisition to be accretive to earnings by the 3rd Quarter 2010.

The closing of the acquisition is subject to customary due diligence, closing conditions and regulatory approvals.

About DJSP Enterprises, Inc.

DJSP Enterprises is the largest provider of processing services for the mortgage and real estate industries in Florida and one of the largest in the United States. The Company provides a wide range of processing services in connection with mortgages, mortgage defaults, title searches and abstracts, REO (bank-owned) properties, loan modifications, title insurance, loss mitigation, bankruptcy, related litigation and other services. The Company’s principal customer is the Law Offices of David J. Stern, P.A. whose clients include all of the top 10 and 17 of the top 20 mortgage servicers in the United States, many of which have been customers for more than 10 years. The Company has approximately 1,000 employees and contractors and is headquartered in Plantation, Florida, with additional operations in Louisville, Kentucky and San Juan, Puerto Rico. The Company’s U.S. operations are supported by a scalable, low-cost back office operation in Manila, the Philippines that provides data entry and document preparation support for the U.S. operation.

Forward Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, about DJSP Enterprises, Inc. and Timios, Inc. Forward looking statements are statements that are not historical facts. Such forward-looking statements, based upon the current beliefs and expectations of the Company’s management, are subject to risks and uncertainties, which could cause actual results to differ from the forward looking statements. The following factors, among others, could cause actual results to differ from those set forth in the forward-looking statements: business conditions; changing interpretations of generally accepted accounting principles; outcomes of government or other regulatory reviews, particularly those relating to the regulation of the practice of law; the impact of inquiries, investigations, litigation or other legal proceedings involving the Company or its affiliates, which, because of the nature of the Company’s business, have happened in the past to the Company and the Law Offices of David J. Stern, P.A.; the impact and cost of continued compliance with government or state bar regulations or requirements; legislation or other changes in the regulatory environment, particularly those impacting the mortgage default industry; unexpected changes adversely affecting the businesses in which the Company is engaged; fluctuations in customer demand; the Company’s ability to manage rapid growth; intensity of competition from other providers in the industry; general economic conditions, including improvements in the economic environment that slows or reverses the growth in the number of mortgage defaults, particularly in the State of Florida; the ability to efficiently expand its operations to other states or to provide services not currently provided by the Company; the impact and cost of complying with applicable SEC rules and regulation, many of which the Company will have to comply with for the first time after the closing of the business combination; geopolitical events and changes, as well as other relevant risks detailed in the Company’s filings with the U.S. Securities and Exchange Commission, (the “SEC”), including its report on Form 20-F for the period ended December 31, 2009, in particular, those listed under “Item 3. Key Information – Risk Factors.” The information set forth herein should be read in light of such risks. The Company does not assume any obligation to update the information contained in this press release.

   
Company Contact:  
David J. Stern  
Chairman and CEO  
DJSP Enterprises, Inc.  
Phone: 954-233-8000, ext. 1113  
Email: dstern@dstern.com  
   
or  
   
Kumar Gursahaney  
Executive Vice President and CFO  
DJSP Enterprises, Inc.  
Phone: 954-233-8000, ext. 2024  
Email: kgursahaney@dstern.com  
   
Investor Contact:  
Hayden IR  
Cameron Donahue  
Phone: 651-653-1854  
Email: cameron@haydenir.com  
   
 

SOURCE DJSP Enterprises, Inc.

Read more: http://www.miamiherald.com/2010/04/19/v-fullstory/1586456/djsp-enterprises-inc-announces.html#ixzz0lbZw1okr

Goldman Sachs taps ex-W.H. counsel: SCAM THICKENS!

By EAMON JAVERS & MIKE ALLEN | 4/19/10 8:14 PM EDT
Updated: 4/19/10 10:03 PM by POLITICO

Goldman Sachs is launching an aggressive response to its political and legal challenges with an unlikely ally at its side — President Barack Obama’s former White House counsel, Gregory Craig.

The beleaguered Wall Street bank hired Craig — now in private practice at Skadden, Arps, Slate, Meagher & Flom — in recent weeks to help in navigate the halls of power in Washington, a source familiar with the firm told POLITICO.

“He is clearly an attorney of eminence and has a deep understanding of the legal process and the world of Washington,” the source said. “And those are important worlds for everybody in finance right now.”

They’re particularly important for Goldman.

On Friday, the SEC charged the firm with securities fraud in a convoluted subprime mortgage deal that took place before the collapse of the housing market. Next week, Goldman Sachs CEO Lloyd Blankfein will face questions from the Senate Permanent Subcommittee on Investigations, which is looking into the causes of the housing meltdown, the source said.

In Craig, Goldman Sachs will have help from a lawyer with deep connections in Democratic circles.

Craig served as White House counsel during the first year of Obama’s presidency, but is seen as having been pushed out for his role in advocating a strict timeline for the closing of the U.S. detention facility at Guantanamo Bay. His departure frustrated many liberal Obama supporters who saw Craig as a strong advocate for undoing some of what they saw as the worst excesses of the Bush era.

But the source familiar with Goldman’s operations said Craig wasn’t hired just because he’s well-connected.

“It’s about advice and process,” the source said. “People will always leap to the conclusion that it’s about somebody’s Rolodex.”

Skadden declined to comment on Craig’s role with Goldman.

“A former White House employee cannot appear before any unit of the Executive Office of the President on behalf of any client for 2 years—one year under federal law and another year under the pledge pursuant to the January 2009 ethics E0,” said a White House official.

The official also said that the White House had no contact with the SEC on the Goldman Sachs case. “The SEC by law is an independent agency that does not coordinate with the White House any part of their enforcement actions.”

Whatever the reason for his hiring, Craig will presumably be a key player in the intricate counterattack Goldman Sachs officials in Washington and Manhattan improvised during the weekend — a plan that took clearer shape Monday as Britain and Germany announced that they might conduct their own investigations of the firm.

For three weeks, Goldman had planned to hold a conference call Tuesday to unveil its first-quarter earnings for shareholders. Shifting into campaign mode after the SEC’s surprise fraud filing, Goldman has moved the call up from 11 a.m. to 8 a.m. to try to get ahead of the day’s buzz. In an unusual addition, the firm’s chief counsel will be on the line to answer questions about the case, and Goldman is inviting policymakers and clients to listen to the earnings call themselves rather than rely on news reports.

Industry officials said the conference call — which will include, as originally planned, Chief Financial Officer David Viniar — will amount to a public unveiling of Goldman’s crisis strategy.

But the linchpin of that plan is already clear: An attempt to discredit the Securities and Exchange Commission by painting the case as tainted by politics because it was announced just as President Barack Obama was ramping up his push for financial regulatory reform, including a planned trip to New York on Thursday.

“The charges were brought in a manner calculated to achieve maximum impact at point of penetration,” a Goldman executive said.

Among the points Greg Palm, co-general counsel, plans to emphasize on the call is “how out of the ordinary the process was with the SEC,” the executive said. The SEC usually gives firms a chance to settle such charges before they are made public. Goldman executives say they had no such chance,and learned about the filing while watching CNBC.

With a monstrous problem and mammoth resources, the iconic firm is paying for advice from a huge array of outside consultants, including such top Washington advisers as Ken Duberstein and Jack Martin, founder of Public Strategies.

The basic plan: Make a tough, factual case without coming off as arrogant or combative and without souring the firm’s image even further.

Partly because of the firm’s belief that it has become an easy target, no Goldman officials have appeared on television since the SEC announced its case.

The firm thinks it can be more effective if others make its case. On CNBC’s “Squawk Box” on Monday, Andrew Ross Sorkin of The New York Times, who gets special attention from Goldman spinners, raised questions about the substance of the SEC’s case. Shortly thereafter, Sen. Judd Gregg of New Hampshire, the top Republican on the Senate Budget Committee, said he is “a little interested in the timing” of the case.

Reflecting a high-stakes balance for the unpopular investment bank, Goldman plans to stop short of a frontal attack. Instead, it is raising questions and feeding ammunition to allies.

“We don’t want to come across as being arrogant and above it all,” said a Goldman executive who insisted on anonymity. “The SEC is the major regulator of several of our businesses. Being at war with them is not the goal.”

Therefore, an official said, a key Goldman message in the days ahead will be, “We’re not against regulation. We’re for regulation. We partner with regulators.”

Goldman said its most important audience is its client base, from CEOs all over the world to pension-fund managers to entrepreneurs who use the firm’s private wealth-management services. The firm sent its staff two pages of talking points giving basic facts — and the official line — about the SEC case: “Goldman Sachs Lost Money on the Transaction … Objective Disclosure Was Provided.”

The less official message, according to one executive: “Don’t believe everything you read in the complaint. Don’t believe everything you read in the press.”

The official said clients have been sympathetic.

Other audiences include the news media and governments around the world, with Goldman reaching out Tuesday to politicians in Europe, Japan, the U.S. and everywhere in between.

Goldman pays extraordinary attention to its alumni network because so many of its former officials are in visible, powerful positions. An official said the firm tries “to empower them with information,” so that when they’re put on the spot about the Goldman case, they can say, “I’m not there, but let me tell you a few things I’ve been told.”

Created Assignments And “Cloned” Officers Yield Fraudulent Foreclosures Across The Country

By: Cynthia Kouril Monday April 19, 2010 12:27 pm

In courtrooms across the country, judges are foreclosing on homes based on improperly prepared documentation, some of which may even be fraudulent. At the heart of the problem are entities like Mortgage Electronic Registration System (MERS), which itself is owned by many of the largest financial institutions in the U.S. If MERS and other similar firms acting as foreclosing entity were required to show legal proof of mortgage assignment, the documentation offered could reveal a lack of capitalization that would make the bank bailout look like lunch money.

Imagine you are a judge in a state court mortgage foreclosure part, or maybe in a bankruptcy court.

Your experience and training tells you what is supposed to happen. An originator of a mortgage, with the actual wet ink documents in hand and full knowledge of the transaction, makes MERS the nominee for the holder of the mortgage and records the mortgage in MERS’s name and gives physical custody of the wet ink documents to MERS. The originator then assigns the mortgage and note to Bank. Bank, with full knowledge of the assignment transaction, may assign it further, perhaps into a trust to back up Residential Mortgage Backed Security (RMBS). All of this would be done with proper notice to MERS who would always be up to date on who is the most recent assignee of the mortgage. When the time comes to foreclose, MERS would release the wet ink documents to the lawyers for the last assignee, who would use those original documents to foreclose.

Now comes into your court, a party claiming to be the lender—or at least the lender’s successor in interest—saying that it has acquired the homeowner’s mortgage by assignment. The homeowner took out the mortgage 5 or 6 years ago from XYZ originator, but the loan was recorded at the county clerk’s office or local land office as being in the hands of MERS.. I have explained about MERS and other issues relating to sloppy mortgage document handling in prior posts.

Attached to the complaint is a document which, on its face, appears to be an assignment of the mortgage from MERS to plaintiff. It is signed by a person with an official looking title at MERS. So, would you be safe in assuming that the person who signed the assignment:

1) went and fetched this mortgage out of a file room at MERS;

2) checked it over to make sure it was properly assigned from the originator to MERS; and

3) that the party to which the assignment was about to made had paid for the right to own the mortgage, before executing the assignment?

No, you would not.

In the Aughts, during the rush to make loans and generate all those origination fees, front line lenders and mortgage brokers would zoom through paperwork and flip the mortgages immediately over to trusts and servicers. They didn’t always complete the paperwork to assign the mortgage over to either MERS or to the trust. The mortgage may have been filed with the county clerk as belonging to either MERS or to some mortgage back securities trust, but the actual assignment papers might never have been executed. And although money moved around from the servicers, originators and investors, paperwork indicating payment for the transfer of a particular mortgage was not always provided.

Nonetheless, servicers acted as if the loans had actually been paid for and properly assigned and sent out notices to homeowners saying that payments on a particular mortgage were now to be directed to this servicer. The homeowners paid the servicers who presumably forwarded on a net amount, less their servicing fees, to the investors in the Residential Mortgage Backed Securities (RMBS).

Then one day, the homeowner goes into default. The trustee for the trust that is supposed to be holding the mortgage for the benefit of the investors in the RMBS, springs into action and want s to foreclose. Well, actually, the servicer springs into action using the name and consent of the trustee — the servicer makes tons more in fees from foreclosure than it does from mortgage modification.

The servicer hires a law firm. The law firm will need an assignment document as proof that the trustee owns the note and has standing to foreclose. Where does the law firm get this assignment? Does the trustee contact MERS and ask for assignment? Does the trustee have to pay somebody to buy the note? Does MERS prepare the document and send it over?

Nope.

In many instances, an employee of the servicer, or of a document mill executes hired by the servicer, creates and signs the assignment from the originator, indicating that he or she is an officer of the originator. Sometimes an employee of the law firm executes an assignment from MERS indicating that he or she is an officer of MERS.

In neither case, is it likely that the person executing the assignment has ever clapped eyes on the mortgage documents. Rarely, if ever, does the signer have any direct knowledge of whether any money has actually changed hands to effectuate the purchase of this mortgage by the entity which will be receiving it and foreclosing upon it. In order for someone to acquire rights under a note, they must be a “purchaser for value”.

Let me say this again. People who are not actually employees or officers of the originator, sign as if they are. People who don’t actually know if a loan was ever paid for, are executing documents as if they do. They are purporting to transfer mortgages from the originator to either MERS, or to an entity called the “depositor” who deposits the mortgage into a RMBS trust, or directly to a RMBS trust. People who are not employees of MERS are executing documents purporting to transfer mortgages — which may or may not have actually been properly transferred into MERS — from MERS to RMBS trusts.

AND NOBODY IS TELLING THE JUDGES OR THE HOMEOWNERS THAT THESE DOCUMENTS HAVE NO ACTUAL KNOWLEDGE BEHIND THEM.

I am not accusing the people who sign these things of deliberately lying, in the sense that you tell a deliberate falsehood knowing it to be false. I’m sure they “hope” the documents are accurate; they just have no way of knowing.

Click here to read about a law firm that creates, and has its own employees sign, assignments from MERS that it uses as exhibits in the cases it brings. Click here to read about a group of people signing on behalf of many different originators simultaneously.

Having read these articles about created assignments and a “clone army” of officers signing documents, courts should pay attention to the fact that the signatories are pretending to work for the GRANTOR — the original lender or someone in the chain. However, they are really being paid by the GRANTEE — the mortgage servicer working on behalf of the trust. Talk about your conflict of interest.

The signers have no personal knowledge as to the accuracy of anything they are representing.

So, when you, the judge, are presented with this complaint and the documents which purports to effect various assignments, how do you know if any of it is real? You don’t.

DON’T QUIT!

Don’t Quit

Anonymous

              When things go wrong, as they sometimes will,               
 When the road you’re trudging seems all uphill,
When the funds are low and the debts are high,
And you want to smile, but you have to sigh,
When care is pressing you down a bit Rest if you
must, but don’t you quit.

Life is queer with its twists and its turns, As
everyone of us sometimes learns, And many a
failure turns about When they might have won,
had they stuck it out. Don’t give up though the
pace seems slow, You may succeed with
another blow.

Often the goal is nearer than,
It seems to a faint and faltering man,
Often the struggler has given up
When he might have captured the victor’s cup;
And he learned too late when the night came down,
How close he was to the golden crown.

Success is failure turned inside out The
silver tint of the clouds of doubt And
you never can tell how close you are,
It may be near when it seems so far;
So stick to the fight when you’re
hardest hit, It’s when things
seem worst that you

MUST NOT QUIT!

Open Letter to Honorable Judges in Foreclosure and Bankruptcy Proceedings

LYNN E. SZYMONIAK, ESQ.

 The Metropolitan, PH2-05 403

South Sapodilla Avenue

West Palm Beach, Florida 33401

April 19, 2010

 

Dear Honorable Judges in Foreclosure and Bankruptcy Proceedings:
 
 
This letter concerns how a Jacksonville, Florida publicly-traded company, Lender Processing Services, Inc. solves Deutsche Bank National Trust Company missing documents in foreclosure cases. Deutsche Bank National Trust Company (“DBNTC”) is the plaintiff in the majority of foreclosure actions filed in thousands of counties in America since 2007. Deutsche Bank is sometimes referred to as “America Foreclosure King.” There is currently a Department of Justice investigation of LPS and its influence over law firms in foreclosure actions, according to an article in the Dow Jones Daily Bankruptcy Review on April 16, 2010.

In these foreclosure actions, DBNTC is usually acting as the trustee for a mortgagebacked securitized trust. This means that a securities company made a commodity out of approximately 5,000 mortgages that were bundled together. The notes in the trust have a face value of approximately $1.5 billion in each trust. Investors buy shares of these trusts. Deutsche Bank is the most common name in the business of being a Trustee for Mortgage-Backed trusts. Other banks very active in this role of Trustee include Wells Fargo, U.S. Bank, Citibank, Bank of New York, JP Morgan Chase and HSBC.

When each of these trusts was made, the securities company responsible for the securitization (often Financial Assets Securities Corporation in Greenwich, Connecticut) was supposed to have obtained mortgage assignments showing that the trust had acquired each mortgage and note from the previous owner, which was most often the original lender. The trust documents specify that the mortgages, notes and assignments in recordable from will have been obtained by the trust. Most mortgage-backed trusts included the following or equivalent language regarding Assignments:

Assignments of the Mortgage Loans to the Trustee (or its nominee) will not be recorded in any jurisdiction, but will be delivered to the Trustee in recordable form, so that they can be recorded in the event recordation is necessary in connection with the servicing of a Mortgage Loan.

Trustees take very few actions relating to the individual properties in the trust. Typically, the bank acting as a trustee for a mortgage-backed trust hires a mortgage servicing company to deal with issues involving the individual mortgages in the trust. The mortgage servicing companies in turn hire a “default management company” to foreclose when a homeowner defaults on payments on a loan that is part of the trust. Lender Processing Services in Jacksonville, Florida, is the largest mortgage default management company. Deutsche Bank National Trust Company uses several mortgage servicing companies, but most often uses American Home Mortgage Servicing, Inc. in Irving, Texas as its mortgage servicing company.

In tens of thousands of foreclosure cases filed by Deutsche Bank National Trust Company as trustee for a mortgage-backed trust, Deutsche Bank has not produced the mortgage, note or Assignment and instead has filed pleadings claiming that the original mortgage and note were inexplicably lost. In these cases, Deutsche Bank uses specially prepared Mortgage Assignments to show that they have the right to foreclose. These documents were often prepared by clerical employees of Docx, LLC, a subsidiary company of Lender Processing Services, the default management company. Hundreds of thousands of other Mortgage Assignments came from the LPS office in Dakota County, Minnesota. More recently, these documents were produced from the LPS offices in Jacksonville, Duval County, Florida. In thousands of other cases, LPS directs the law firms it hires to use the employees of the law firms to sign as officers of Mortgage Electronic Registration Systems to create the documents necessary for foreclosure

a) Mortgage Electronic Registration Services (MERS) is identified as the grantor and American Home Mortgage Servicing, Inc. is identified as the grantee; within days (or minutes), a second Assignment is filed, identifying American Home Mortgage Servicing, Inc. as the grantor and Deutsche Bank National Trust Company as trustee for the trust as the grantee;

b) a mortgage company no longer in existence is identified as the grantor and American Home Mortgage Servicing, Inc. is identified as the grantee; within days (or minutes), a second Assignment is filed, identifying American Home Mortgage Servicing, Inc. as the grantor and Deutsche Bank National Trust Company as trustee for the trust as the grantee;

c) a mortgage company no longer in existence is identified as the grantor and Deutsche Bank National Trust Company as trustee is identified as the grantee;

d) American Home Mortgage Servicing, Inc., purporting to be the “successor-in-interest” to Option One Mortgage Company, is identified as the grantor and Deutsche Bank National Trust Company as trustee is identified as the grantee;

e) Sand Canyon Corporation, formerly known as Option One Mortgage Company, is identified as the grantor and Deutsche Bank National Trust Company as trustee is identified as the grantee, with no further explanation of how both American Home Mortgage Servicing and Sand Canyon have authority to act for Option One Mortgage.

On several hundred thousand Assignments, the individuals signing as officers of the grantor were actually clerical employees of Lender Processing Services, the mortgage default management company hired by American Home Mortgage Servicing, Inc., working for the grantee – Deutsche Bank National Trust Company. On several hundred thousand Assignments, the very same individuals signed as officers of both the grantor and grantee.

In all of these hundreds of thousands of cases, no Assignment actually took place on the date stated and no consideration was paid by the grantee to the grantor despite the representations in the Assignments. Most significantly, no disclosure was ever made to the Court in the foreclosure or bankruptcy case or to the homeowners in default that the original Assignments to the Trust were never made – or were lost – or were defective and that the recently-filed Assignments were specially made to facilitate foreclosures years after the property was transferred to the trust.

An examination of the signatures on these Assignments shows that many are forgeries, with several different people signing the names Linda Green, Tywanna Thomas, Korell Harp, Jennifer Ohde, Linda Thoresen and many of the other names used on several million mortgage assignments, as I have reported in my article “Compare These Signatures.” Many of these same individuals use at least a dozen different job titles as I have reported in my article, “An Officer of Too Many Banks.” These articles are available at www.frauddigest.com.

A summary of my credentials can be found at www.szymoniakfirm.com.

Please do not hesitate to contact me for additional information.

Yours truly,

Lynn E. Szymoniak, Esq.

This article could also have been titled:  

HOW LENDER PROCESSING SERVICES, INC. SOLVES U.S. BANK’S MISSING PAPERWORK PROBLEM IN FORECLOSURES
-or-
HOW LENDER PROCESSING SERVICES, INC. SOLVES WELLS FARGO MISSING PAPERWORK PROBLEM IN FORECLOSURES
-or-
HOW LENDER PROCESSING SERVICES, INC. SOLVES BANK OF NEW YORK MISSING PAPERWORK PROBLEM IN FORECLOSURES
-or-
HOW LENDER PROCESSING SERVICES, INC. SOLVES CITIBANK’S MISSING PAPERWORK PROBLEM IN FORECLOSURES
-or-
HOW LENDER PROCESSING SERVICES, INC. SOLVES HSBC’S MISSING PAPERWORK PROBLEM IN FORECLOSURES

 

For a copy of the Exhibits referenced below, please contact szymoniak@mac.com.

Copies of Assignments from MERS to American Home Mortgage Servicing, Inc. are attached hereto as Exhibit 1.

Copies of Assignments from American Home Mortgage Servicing Inc. to Deutsche Bank as Trustee are attached as Exhibit 2.

Copies of Assignments from American Brokers Conduit, a mortgage company no longer in existence at the time the Assignments were made, to Deutsche Bank as trustee are attached as Exhibit 3.

Copies of other Assignments to Deutsche Bank as Trustee signed by employees of Lender Processing Services, working for the grantee Deutsche Bank, but signing on behalf of the grantor mortgage companies or banks, or MERS as nominee for the grantor mortgage companies or banks, are attached as Exhibit 4.

Copies of Assignments from American Home Mortgage Servicing, Inc. as the successorin-interest to Option One Mortgage as grantor and Deutsche Bank as Trustee as the grantee are attached as Exhibit 5.

Copies of Assignments from Sand Canyon, formerly known as Option One Mortgage as grantor and Deutsche Bank as Trustee as the grantee are attached as Exhibit 6.

Copies of Assignments signed by employees of law firms working for Lender Processing Services on behalf of American Home Mortgage Servicing, Inc. and ultimately for grantee Deutsche Bank, where such employees signed as officers of MERS as grantor are attached as Exhibit 7.

Copies of Assignments signed by employees of Lender Processing Services on behalf of grantors and notarized in Duval County, Florida for grantee Deutsche Bank, filed by law firms working for Deutsche Bank are attached as Exhibit 8.

Is the SEC Case Against Goldman Sachs Being Staged for Political Advantage?

by Bill Sardi

Recently by Bill Sardi: Preparations Being Made To Move Fort Knox Gold Into Your Bank Account

 

What just happened to Wall Street, with the announcement that the Securities Exchange Commission has filed fraud charges against Goldman Sachs Group, Inc., is so damning that its impact had to be blunted by its late Friday afternoon release. It’s what government does when it doesn’t want the stock market to plunge. But government DOES want to play up to the public’s infuriation over continuing revelations of greed and fraud on Wall Street.

A Monday morning release of this story might have sent the entire stock market into a crash (Goldman Sachs Group Inc, stock is down 23.57 points, erasing ~$12 billion of market capitalization), and that’s because there are likely more fraudulent billion-dollar investments to be revealed.

The American public needs to first grasp a broader view of this event. The Administration in Washington DC, heading for an election in November that will surely be fueled with voter outrage, has decided to strike a seeming blow to Wall Street to strengthen its hand in pushing for financial reform. Yet it is so odd that politicians were the ones who allowed all this to happen (more on this below). Does anyone have an explanation why the SEC has only now decided to file charges involving a 2007 billion-dollar investment? Or why the investor who most benefited financially and who assembled this mortgage-backed investment, John Paulson, has yet to be charged with any wrongdoing?

The smoking gun: an e-mail

 
John Paulson, the billionaire  
   

Another piece of the intrigue here is that the primary provider of evidence in the case is a star Goldman Sachs trader, a Frenchman by birth, who has suddenly left the U.S. for Europe as this story hits the news outlets. Fabrice Tourre, a GS vice president, wrote an email in 2007 that is the smoking gun in this case. Did he leave the U.S. in fear for his life?

Mr. Tourre’s 2007 email, which said “the whole building is about to collapse now,” shortly before the bonds were sold, and which said he would be the only potential survivor, provides foreknowledge of the billion-dollar investment that was sure to fail. Tourre was “principally responsible” for piecing together this novel and new type of investment at GS. He was the point man for Paulson.

When Tourre produced a 65-page “flip book” that contained details of the billion-dollar investment, to be provided to potential investors, this provided the evidence that SEC needed for its case.

 
  Fabrice Tourre, 31-year-old Goldman Sachs vice president, who is reported to have fled the country with the announcement that a 2007 email he wrote is the “smoking gun” in the SECs case against GS.
   

Don’t get the false impression that Mr. Tourre is a whistleblower here. The SEC alleges Mr. Tourre misled investors about Paulson’s role, saying Paulson had invested millions of dollars in hopes the packaged mortgage bonds would rise in value. Of course, Mr. Tourre is not the target of the SEC complaint, Goldman Sachs is. Its senior management had full knowledge of this deal. From 2004 to 2007, Goldman Sachs had arranged about two dozen similar deals.

Nor should anyone get the false notion that Paulson let others do all his bidding. He was actively raising funds and selling investment groups on this kind of instrument for some time, going back to 2006. Paulson wanted to invent the invincible wager.

An article in The Wall Street Journal documents that a senior banker at Bear Stearns Companies turned down this trade, questioning the propriety of selling deals to investors that a bearish client had assembled. (Bear market traders bet that an investment will fall in value, while bull-market traders bet than an investment will rise in value.) 

 

Throw the book at them

Believe it or not, an entire book was written of this now infamous investment before the SEC took action.

Of interest is Greg Zuckerman, The Wall Street Journal’s senior reporter in this case, who wrote The Greatest Trade Ever, about this trade and others like it, long before the SEC took action. The jacket on this book says: “The behind-the-scenes story of how John Paulson defied Wall Street and made financial history.” The book, published in November of 2009, hardly made ripples on Wall Street or in the financial news press. The SEC was sitting on all this information for over two years and did nothing. It was waiting for the right political moment to strike.

Zuckerman’s book outlines how John Paulson assembled risky mortgage investments with another party, Goldman Sachs, investments that were sure to fail, and then bet against them. Goldman Sachs used its reputation to promote the packaged mortgage investment to an overseas investor without revealing it was in cahoots with Paulson. In fact, the overseas bank involved specifically said it would not proceed if the packaged mortgages had been assembled by Paulson.

Paulson made a killing – a billion dollars, and Goldman Sachs made millions assembling the deal from both sides. Paulson’s defense is that he made no misrepresentations, only Goldman Sachs did, but what of the ethics of this deal?

 

Yves Smith, author of Naked Capitalism, and head of Aurora Advisors, a management consulting group, and the author of the new book, Econned: How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism, calls the investment that John Paulson sponsored a “Trojan horse for Mr. Paulson to take a short position, betting against the very same investment he was creating, but his intent was not disclosed…. at the expense of investors who had been kept in the dark and would almost certainly have turned down the deal if they had had the full picture.”

Goldman Sachs living up to its now infamous reputation

It’s obvious now that Goldman Sachs will be the pin cushion for the Administration’s attempt to regain public credibility before the November election. Goldman Sachs is the villain, and it is doing a good job of playing this role.

Just prior to the revelations about the alleged Paulson/Goldman Sachs scandal, the SEC launched other charges against a Goldman Sachs director. Various news sources reported that Rajat Gupta of GS is being investigated on suspicion that he provided inside information to the Galleon Group, a hedge fund founded by Raj Rajaratnam that has now become the biggest insider-trading probe in many years. So the SEC could mire Goldman Sachs with even more allegations in an effort to bring the billion-dollar company to its knees.

This publicly-staged legal action resembles that of President Bill Clinton’s 1995 assault against the tobacco companies, which was launched under the guise of a threat to public health, but really had a political agenda – that of taking away millions of dollars of campaign funds that the tobacco industry was donating to the Republican Party at the time.

If you are as confused as everyone else what the SEC is fussing about, you might click here to take a peek at a graphic created by The Wall Street Journal which visually displays how the deal between John Paulson and Goldman Sachs was prearranged and marketed.

Of course, GS sees nothing wrong with this trade, which should ignite even further public outrage. GS needs a good public relations man at the moment as it digs an even deeper hole every time it attempts to defend its own actions. (Recall GS’ CEO Lloyd Blankfein who recently said he’s “doing God’s work.”)

Congress opened the door

To return to the government’s culpability in this case, the Commodities Futures Modernization Act which Congress passed a decade ago, opened the door for trades like John Paulson’s. This legislation eliminated the long-standing rule that derivatives bets made outside regulated exchanges are legally enforceable only if one the parties involved in the bet were hedging against a pre-existing risk. Prior regulations said the only people who can bet against an investment actually have to own shares in it. Here is Paulson betting against an investment he had no ownership in.

 

The Commodities Futures Modernization Act is akin to allowing unscrupulous investors to buy fire insurance on other people’s houses, says Lynn A. Stout, Paul Hastings Professor of corporate and securities law at UCLA. A rise in arson would surely occur to collect on the investment.

Or like Rick Edelson, an online blogger speaking out in the New York Times, says: “Like the arsonist who buys insurance on another man’s house, Goldman and Paulson did everything they could to burn down the American economy, because it was only by destroying others’ wealth that they could maximize their own profit.”

Good God, do these men see in their greed they have scuttled the American economy, as well as faith in Wall Street investments that fund most pension plans?

When Paulson made billions, Wall Street was not quick to condemn. He got away with it, and that was to be applauded. Some investment bloggers said “well done.” Another said Paulson is “an investing stud. He is to be hailed for his moxie and superior forecasting.”

 

Other defenders of Wall Street claim Paulson didn’t create a real estate market with collapsing home values. But to package non-performing mortgages and then bet against them is like a rigged horse race.

Scripting for a thrilling end

For sure, the Administration in Washington DC will be portrayed in coming months as the hero, rescuing the public from the blood-suckers on Wall Street. Be it government to save us all from problems it created and then pin a badge of honor on itself. The current and former administrations in Washington DC are, and have been, so tightly controlled and managed by Wall Street, even with its ex-CEOs strategically implanted within the Executive Branch, as to call all alleged reforms and sanctions into question. These are just for show.

Goldman Sachs and its billions will face off against the might of US prosecutors with the President’s credibility on the line. Will a publicized trial be showcased on TV? It could become the high drama that the government wants to keep before the public’s eyes, all the way up to the November election.

Will Paulson squirm out of any legal consequences in the same manner as O.J. Simpson when he was asked to put an ill-fitting glove on his hand in a televised hearing? Will the President be able to control himself and not chime in like he did when he said Cambridge, Massachusetts police officers “acted stupidly” when they arrested a renowned black scholar at his home?

Goldman Sachs knows it has to make the President look good or there will be unending SEC prosecution. The public wants to know whose side is the President is on, the financial titans on Wall Street or the unemployed on Main Street? It will be scripted from the beginning.

And now a final question – will Goldman Sachs be the fall guy in exchange for future favors from the government? If fines are handed out and nobody goes to jail, you will know this was likely preplanned. Will Fabrice Tourre serve as the scapegoat? He’s sure to stay outside the country for his own good. Don’t be so naïve as to not believe much of what you see happening is being staged. That’s how politics works. It’s all about political advantage, not law and order, not right and wrong.

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April 19, 2010

Bill Sardi [send him mail] is a frequent writer on health and political topics. His health writings can be found at www.naturalhealthlibrarian.com. He is the author of You Don’t Have To Be Afraid Of Cancer Anymore. His latest book is Downsizing Your Body.

Copyright © 2010 Bill Sardi Word of Knowledge Agency, San Dimas, California. This article has been written exclusively for http://www.LewRockwell.com and other parties who wish to refer to it should link rather than post at other URLs. 

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