CitiMortgage: Foreclosing Homes while working “LIAR” Loan Modifications!

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Lehman sues JPMorgan for billions in damages: REUTERS

Jonathan Stempel

NEW YORK
Wed May 26, 2010 7:56pm EDT

The JP Morgan and Chase headquarters is seen in New York in this January 30, 2008 file photo. REUTERS/Shannon Stapleton

NEW YORK (Reuters) – Lehman Brothers Holdings Inc (LEHMQ.PK) on Wednesday sued JPMorgan Chase & Co (JPM.N), accusing the second-largest U.S. bank of illegally siphoning billions of dollars of desperately-needed assets in the days leading up to its record bankruptcy.

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The lawsuit filed in Manhattan bankruptcy court accused JPMorgan of using its “unparalleled access” to inside details of Lehman’s distress to extract $8.6 billion of collateral in the four business days ahead of Lehman’s September 15, 2008, bankruptcy, including $5 billion on the final business day.

JPMorgan was Lehman’s main “clearing” bank, in which it acts as a go-between in Lehman’s dealings with other parties.

According to the complaint, JPMorgan knew from this relationship that Lehman’s viability was fast weakening, and threatened to deprive Lehman of critical clearing services unless it posted an excessive amount of collateral.

“With this financial gun to Lehman’s head, JPMorgan was able to extract extraordinarily one-sided agreements from Lehman literally overnight,” the complaint said. “Those billions of dollars in collateral rightfully belong to the Lehman estate and its creditors.”

Lehman also said JPMorgan officials including Chief Executive Jamie Dimon decided to extract the collateral after learning from meetings with Federal Reserve Chairman Ben Bernanke and then-U.S. Treasury Secretary Henry Paulson that the government would not rescue Lehman from bankruptcy.

In the widely expected lawsuit, Lehman and its official committee of unsecured creditors are seeking $5 billion of damages, a return of the collateral and other remedies.

JPMorgan spokesman Joe Evangelisti called the lawsuit “meritless,” and said the bank will defend against it.

Any money recovered could increase the payout to creditors. Lehman has also sued Barclays Plc (BARC.L) to recover an $11.2 billion “windfall” from the takeover of U.S. assets.

In March, a bankruptcy judge approved an accord providing for JPMorgan to return several billion dollars of assets to Lehman’s estate, but giving Lehman a right to sue further.

Lehman collapsed after letting its balance sheet swell through exposure to commercial real estate, subprime mortgages and other risky sectors. With $639 billion of assets, Lehman was by far the largest U.S. company to go bankrupt.

EXAMINER REPORT

In his March report on Lehman’s bankruptcy, court-appointed examiner Anton Valukas said Lehman could raise a “colorable claim” against JPMorgan over the collateral demands.

He nevertheless said JPMorgan could raise “substantial defenses” under U.S. bankruptcy law.

Evangelisti contended that “as the examiner’s report makes clear, it was the ill-advised decisions of Lehman and its principals to take on perilous leverage and to double down on subprime mortgages and overpriced commercial real estate — and not conduct by our firm — that led to Lehman’s demise.”

Lehman, though, maintained that JPMorgan extracted the collateral to “catapult” itself ahead of other creditors.

“A century ago, John Pierpont Morgan used his position atop the world of finance to shore up a teetering firm and rescue the nation from the brink of financial collapse,” the complaint said, referring to the Panic of 1907.

“A century later, when the nation faced another epic financial crisis, Morgan’s namesake firm stripped a faltering Lehman Brothers of desperately needed cash,” it added.

The case is In re: Lehman Brothers Holdings Inc et al, U.S. Bankruptcy Court, Southern District of New York, No. 08-13555.

(Reporting by Jonathan Stempel; Additional reporting by Matthew Goldstein; Editing by Phil Berlowitz, Bernard Orr,Gary Hill)

LENDER PROCESSING SERVICES (LPS) “SECRET INSTRUCTIONS” to FORECLOSURE MILLS

THEY KNOW FROM THE BEGINNING WHO THE REAL PARTIES ARE!

WAS ANY OF THIS EVER DISCLOSED TO THE BORROWERS?

LPS Transmittal Letter. Instructions to the MILLS.

  • WHO
  • HOW
  • WHERE

Note at the end it does NOT WANT any emails on these matter.

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Fidelity’s LPS Secret Deals With Mortgage Companies and Law Firms

“PROCESS SERVING INSIDER”…Other monsters in the Sea: PROVEST, LLC

Posted by SUItheGATOR on May 24, 2010 ForeclosureHamlet.org

Another area that should be investigated in the foreclosure mill process is the “process serving” Mills such as ProVest LLC.

I worked at ProVest for 7 months a few years ago, as jobs are scarce. There were some issues there of some of the servers just “drop serving” the summons, (just leaving at the door and saying they gave it directly) or Sewer serves, (saying it was served and they never even left at the door). A few borrowers obtained legal counsel and executed their rights, as they were never properly served, but there are probably more borrowers unaware they have been “had”.

If Improperly served, the court dates cannot be set.

Due to ProVest’s aggressive style, and high volume of work, it is possible many servers, not direct employees, were forced to do the serves this way due to the volume and ProVest’s unrealistic expectations. They wanted a serve within 10 days of it being filed at the court house. As an employee, server or not, if you did not meet their outrageous timeframes it provoked what I call “public floggings” of employees. Not a nice place to work.

ProVest does process serving for many of the foreclosure mills such as Stern and FDLG… And for the record, when I was there, a husband worked for FDLG, and the wife worked for ProVest…

So, if you want more dirt for your compaign, here it is.. Check to see if the borrowers were properly served.

RELATED STORY:

Lender Processing Services LPS and ProVest: Resemblance is uncanny