Black Farmer Files Lawsuit To Regain Farm With $750,000,000 In Coal And Oil Deposits

the-coal-train-blog.jpg image by Suzanne57

Contributed by muckracker1 (Editor) beforeitsnews.com
Tue May 25 2010 17:57

Latest in 83 year old Black farmer’s fight against illegal foreclosure:
Harry Young files $100 million lawsuit against DOJ and USDA based on loan officer’s testimony at Young’s trial

by Monica Davis

Harry Young is an 83 year old farmer in western Kentucky. He has been waging a five year legal fight to regain his land after the government foreclosured and auctioned the property in 2005. Young filed a $100 million lawsuit against the Secretary of the United States Department of Agriculture, the Department of Justice and various federal officials May 24, 2010. He is seeking a jury trial.

Young, whose land was foreclosed and auctioned in what he contends was an illegal foreclosure, was arrested and tried on charges of allegedly making threats against the Farm Services Agency in Owensboro, Kentucky. He was the last black farmer operating in three western Kentucky counties when his land was sold at what supporters claim was an illegal auction based on fraud in 2005.

At the time, he was not allowed to present evidence of his payments. Young has denied the allegations, that he: made threats, and that he hadn’t made payments on his loan–as alleged by the Assistant US Attorney, who said, in a 2005 press release that “…for many years, Mr. Young had] lived in this house and farmed the land without making payments.”

Young’s land,which includes coal and oil deposits worth as much as $750,000,000 was sold at an auction which supporters say was based on fraudulent, perjured information by federal officials. After the auction,
Young filed suit against the U.S. Department of Agriculture and FSA in May in U.S. District Court in Louisville. In the suit, he asks for $25 million for “the embarrassment, humiliation, pain and suffering and personal indignities” caused by the USDA and FSA. He also asks for $5 million for loss of income from farm and related operations. (Local paper.)

That suit, and two others, were thrown out, based on information from the USDA, which did not include the receipt for the payments totaling over $100,000 in 1985/86. Young was tried on the threat charges in the Western District of Federal Court in Paducah, Kentucky. Supporters say the charges were retaliation for his refusal to stop legal action to regain his farm. His trial on the threat allegations resulted in a hung jury on . Rather than risk another trial, Young accepted a plea bargain deal, where he accepted a pre-trial diversion agreement, agreeing to “stay out of trouble for a year.”

Several issues arise: 1. the government did not acknowledge his loan payments; 2. his account was credited with a loan that another farmer received; and 3. he never received a jury trial in earlier proceedings.

According to a local newspaper covering the foreclosure in 2005:

…Young, who is black, says he is a victim of a racist organization. He points to a letter from Jeffery Hall, state FSA executive director, in December 2004 stating that “no voluntary payments on Mr. Young’s account (have) been received since 1980,” and Young “has remained on the property basically rent free.”

The letter contradicts financial statements that show disbursements of $121,800.26 and $9,394.59 from an escrow account to the Farmers Home Administration, the FSA’s former name, in 1985 and 1986, Young said. (Local paper)

Young also said he was charged interest for loans he never took out. “I don’t owe them nothing,” he said. “I’ve overpaid them if they mark interest off.” (Local paper)

Under oath, in contrast to what had been said earlier–that “anyone could have typed up” the receipt which Young said proved his case, the local FSA county supervisor acknowledged that the signature on the receipt for two loan payments was his. On that basis, Young filed a his latest lawsuit.

For the past 20 years, that this legal battle has been waged, Mr. Young has said that the government was lying about his failure to pay his loan, and had charged him for a loan which he never applied for–the proceeds of which reportedly went to a white farmer. Young has always maintained that he paid his loans–which has been corroborated by by court testimony of the county supervisor of the Farm Services Agency (FSA) and its parent agency, the US Department of Agriculture (USDA), which had earlier claimed that Young hadn’t made a payment on his loan in twenty years. In 2005, the US Attorney out of Louisville, Kentucky, in a press release, said, “For many years, Mr. Young has lived in this house and farmed the land without making payments.”

Justice Department attorneys refused to consider the receipt from the County Supervisor as evidence in 2005. And, when Young showed the receipt to a US Marshal during the auction of his property, the US Marshal reportedly said: “I can’t read.”

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LPS Using TARP Funds to Cover-Up Assignment of Mortgage

Consumer ID thefts or consumer identity thefts is one of the main crimes that cause financial as well as emotional anguish. The rubber-stamping of Assignments of Mortgage and the Double Dipping of foreclosure fees and cost expedite the foreclosure process and line the silk pockets of these attorneys, banks and LPS executives.

This is a copy of the September 14, 2009 e-mail from Adrian Lofton to Bradley Johnson, lead Attorney at Taylor, Day, Currie, Boyd and Johnson apprizing him of their TARP fund violations.

Brad, your firm has created a conflict of interest by representing these banks. In addition to the aforementioned, you are not legally entitled to accept TARP funds to represent these banks after your firm implicated them in these federal violations.
continue reading…

Homeowners strike back at banks: The Daily Tribune

“None of the named defendants have the right or authority to foreclose under (state law) or by contractual right,” he says in the lawsuit.

Published: Tuesday, May 11, 2010

By Jameson Cook, Daily Tribune Staff Writer

Ziyad Kased, left, and May Brikho, both of the Michigan Loan Compliance Advisory Group in Troy, talk to client Mahir “Mark” Salmo, 47, of Sterling Heights, one of 88 plaintiffs in two lawsuits in Oakland and Macomb counties alleging deceptive lending practices against more than two dozen banks. (Craig Gaffield/Daily Tribune)

Lawsuits filed in maneuver to try to stop foreclosure, recover losses from alleged overpayments, improper approval.

About 90 homeowners in Oakland and Macomb counties have accused more than two dozen banks of deceptive lending and other wrongdoing by approving loans far exceeding the plaintiffs’ ability to pay and charging excessive fees, among other allegations.

The accusations are levied in two lawsuits filed in each county’s circuit court within the past two weeks through the Troy-based Michigan Loan Compliance Advisory Group Inc., created to help homeowners in trouble with their mortgages. A third lawsuit with about 10 plaintiffs is expected to be filed in Wayne County Circuit Court this week.

The lawsuits represent an emerging tactic nationwide for struggling homeowners in their attempt to fight off potential foreclosure and gain relief on stifling mortgages from some of the country’s largest banks.

The plaintiffs’ representatives say the banks benefited from federal bailout money while few homeowners are getting help through federal loan modification programs.

“They (the plaintiffs) are victims of deceptive lending. They just want to save their homes,” said May Brikho, senior consultant at Michigan Loan Compliance. “They have tried to reach out to the banks, but the banks just don’t care.”

“The banks created these problems. They should’ve known better. These were all subprime loans. The banks knew they weren’t going to last.”

She noted the ubiquitous effect of the housing crisis. “These are problems that affect everybody.”

Of four banks contacted Thursday, Citimortgage and Bank of America banks indicated they had not been served with one or both lawsuits, so declined comment. Wells Fargo and Chase banks did not respond to a media inquiry.

Joe Bosogno, who operates a similar organization to Michigan Loan Compliance in New Jersey, blames mortgage brokers who worked for banks and mortgage companies for inflating applicants’ income so the mortgages could be sold as an investment device. The sale of subprime loans as investment devices contributed to the nation’s economic collapse.

“This (deceptive lending) was going on all over the country,” Bosogno said. “A number of attorneys are stepping up right now and doing aggregate lawsuits. It’s become a nightmare for the banks.”

Michigan Loan Compliance’s attorney, Ziyad Kased, in the lawsuits calls the banks’ actions “intentional and malicious,” and says the plaintiffs “have suffered substantial economic losses, loss of title and slander of title to the credit rating.”

The lenders “and their underwriters of such loans intentionally deceived the mortgagors by conspiring to promote unaffordable mortgages by companies that had direct ties to investment banks that profited from promoting and selling such debt instruments to innocent investors at everyone’s expense,” Kased said.

The loans depicted in the lawsuits range from $100,000 to $388,000 in Macomb and $87,000 to $809,000 in Oakland, with the bulk ranging from about $150,000 to $350,000.

None of the 88 plaintiffs representing 78 loans in the two counties have yet lost their homes and all are trying to prevent foreclosure. The majority of plaintiffs in Macomb currently reside in homes in Sterling Heights, Warren and Shelby Township. A majority of the Oakland plaintiffs live in West Bloomfield, Commerce Township and Farmington Hills.

The plaintiffs, who obtained the loans between 1995 and 2008, are still making payments despite their struggles.

“We advise our clients to continue to make their payments, but it’s their choice,” Brikho said.

A majority of the plaintiffs emigrated here from the Middle East, and some don’t speak English. Brikho said that while the banks may have taken advantage of that situation, it is only a secondary issue, as many of the plaintiffs are U.S. born.

Michigan Loan Compliance charges clients a fee for services. The organization is also using the courts to help other clients already in a pre-foreclosure fight losing their homes, Brikho said.

Kased said he expects the banks will try to get the cases moved to federal court, where he said bank lawyers believe they can receive better treatment and “drag it out” via legal maneuvers. Kased said he will oppose the transfer. He said he believes the cases should remain in each county since each region’s real estate market differs.

Most of the plaintiffs had their incomes inflated by a substantial amount, Kased said. The industry standard for debt to income ratio is 31 to 38 percent. The ratios of the plaintiffs far exceed that range, going from 68 percent to 714 percent, with most being between 100 and 200 percent in Macomb, and 36 percent to more than 1,000 percent in Oakland, where the differences range wider, several below 100 percent and several above 400 percent, according to the lawsuit.

In many cases, the lender or broker added income of a borrower’s family member who was not part of the loan and/or failed to learn of underreported expenses, Brikho said.

The borrower’s financial situation in most cases has worsened since then, due to job loss or reduction, she said.

One of the plaintiffs is Mahir “Mark” Salmo, 47, of Sterling Heights, and his wife, Thaira. They are suing PNC Bank for the $100,000 loan they received in 1997 before PNC acquired National City Bank.

The bank OK’d Salmo’s loan based on him earning nearly $4,000 per month, he said. In fact, he was earning $1,218 per month, he said.

“They asked me a few personal questions and I answered them,” he said. “I didn’t think I would get it. I couldn’t believe when I got it a couple of days later.”

Salmo in 2003 was given a $250,000 line of credit based only on his high credit score and his home being appraised at $415,000, he said.

He used the money to buy two businesses — a Tubby’s shop in Oak Park and a Wireless Communications store in Sterling Heights. The businesses closed, and Salmo said he lost $300,000.

“I lost both of them because the economy went down,” he said. “I had high rent and couldn’t keep up. I tried to work the landlord, but they wouldn’t budge. Now I have nothing. Everything I have worked for, for 35 years, is gone.”

He is now saddled with an approximately $1,000 monthly payment on the original loan and $600 per month for the equity loan, which is interest-only.

His home value has dropped significantly. He owes $30,000 on the original loan and $230,000 on the second loan.

“I should never have gotten that money,” he said of the second loan. “It’s like a bad dream.”

He said it hurts him most that he can’t financially help his mother, a homeowner who also is a plaintiff.

Salmo is thankful that his wife and three children aged 21 to 24 are working and supporting him, allowing him to make payments.

Salmo, a Chaldean, has lived in the United States for 35 years and said he still loves America despite his problems.

“This is the greatest country in the world,” he said.

Salmo’s interest-only loan is an example of how the banks committed homeowners to mortgages they eventually wouldn’t be able to honor; the real estate bubble that was bound to burst, Sosogno said.

Bosogno said a worse option given to some homeowners, including at least one in the Macomb lawsuit, was “negative amortization” mortgages in which the balance actually increases despite payments.

On top of the original loans, 22 plaintiffs in the Macomb case and 26 in the Oakland case obtained second loans that also were awarded deceptively, the lawsuit says.

The lawsuits ask the judges to make the mortgages “null and void.” Kased argues that the courts have determined that the mortgages should not have been assigned, so the mortgage note holders “in reality own nothing.”

“None of the named defendants have the right or authority to foreclose under (state law) or by contractual right,” he says in the lawsuit.

The plaintiffs allege the banks charged “outrageous” fees for origination, loan discount, appraisal, document preparation, broker processing, lender underwriting and yield to premium, “to name a few,” the lawsuit says. APPRAISAL FRAUD??

The plaintiffs, according to the lawsuit, “were never advised of the split charges and excess interest rate differentials split between the broker and the original lender, they were not informed of various costs that were overinflated as shown on the HUD settlement statements.”

The plaintiffs also weren’t told details of variable rate loans, the lawsuit says.

In years after the mortgage was executed, the defendants failed to respond to the “qualified written request” complaint as required by law to do so, the lawsuit says.

The lawsuit seeks compensatory damages for actual loses and exemplary damages for experiences such as mental anguish and humiliation.

The Macomb case was assigned to Judge John Foster and the Oakland case was assigned to Judge Colleen O’Brien.

First American sues 8 rivals over AVMs: LENDER PROCESSING SERVICES (LPS)

Things that make you go Hmmm…

Patent infringement lawsuit seeks damages from Zillow, LPS, others

BY MATT CARTER, TUESDAY, MAY 4, 2010.

Inman News

First American CoreLogic Inc. has filed a lawsuit against eight companies, including Zillow Inc. and Lender Processing Services Inc., claiming the companies’ automated property valuation services infringe on a 1994 patent.

In its complaint, CoreLogic seeks an injunction against the companies to prohibit them from using or selling any products that fall within the scope of the patent, and for triple damages to “compensate CoreLogic for its profits lost.”

None of the companies named in the April 16 lawsuit have filed formal a response to the complaint, and none would comment to Inman News.

The companies named in the lawsuit provide automated valuation model (AVM) services to businesses or consumers — computer-generated property value estimates that typically rely on a property’s unique characteristics, public property records and other market statistics.

A spokeswoman for Zillow — a site that became one of the Internet’s most popular real estate portals by offering instant, free property “Zestimates” to consumers — said the company was aware of the lawsuit, and “has no plans to change any aspect of our business as a result of this complaint.”

LPS — a technology and data provider for the National Association of Realtors’ Realtor Property Resource database — said the company does not comment on pending litigation, but “does intend to continue providing AVM services.”

NAR’s RPR LLC subsidiary intends to generate revenue by incorporating active and sold listings data into automated property valuations that the company hopes will become a standard for the lending industry, government agencies and others (see story).

Other companies named in the lawsuit include: Fiserv Inc., Intellireal LLC, Interthinx Inc., Precision Appraisal Services Inc., Real Data Inc. and RealEC Technologies Inc.

Patent lawsuits can sometimes take years to resolve, as defendants may be able to demonstrate that a patent was issued for an idea that was not new, or that a patent claim was overly broad or vauge.

In its lawsuit, CoreLogic claims the rights to U.S. Patent 5,361,201, issued Nov. 1, 1994, for an “automated real estate appraisal system” and assigned by its inventors to HNC Inc

Summarizing the system in their patent application, inventors Allen Jost, Jennifer Nelson, Krishna Gopinathan and Craig Smith described how predictive models could generate estimated property values based on individual property characteristics and neighborhood or area characteristics.

Through a trial and error process, they said, the models could be fed “training data” in order to “learn” the relationships between individual property characteristics and area characteristics.

In the learning stage, the model’s predicted property values are compared to actual sales, and the weights assigned to different variables repeatedly adjusted to achieve the greatest degree of accuracy.

Although the process was similar in concept to established regression analysis techniques, the inventors said the application would also employ “neural networks” to automatically detect relationships between variables that would otherwise need to be detected and inputted manually by programmers.

Neural networks, they said, would allow rapid development of models and automated data analysis — a vital capability if the goal is to value properties in thousands of neighborhoods or areas, each requiring its own model.

Once the models had been developed, the inventors said, they could also be programmed to monitor their own performance and adjust their assumptions when performance dropped below a predetermined level.

In addition to an estimated property value, the models would be able to compute the predicted margin of error, allowing for a value range to be generated for each property — a common feature of AVMs offered to consumers.

The patent application described the algorithms and dozens of variables that could be used to generate valuations, and included source code written in ANSI C and Microsoft Excel macro.

The patent was assigned to Transamerica Intellitech Inc. in August 2000, and then to First American Real Estate Solutions, now part of CoreLogic.

First American is spinning off its information solutions group into a separate, publicly traded company, to be known as “CoreLogic.”

***

Bank of America Sues First American on ‘Lien Protection’ Claims

Is this the first of many to come?
Bank of America Sues First American on ‘Lien Protection’ Claims

March 18, 2010, 10:46 AM EDT

By David Mildenberg

March 18 (Bloomberg) — Bank of America Corp. stepped up efforts to curtail the cost of soured mortgages by suing First American Corp., claiming the title insurer refused to cover more than 5,500 loans that caused $535 million of losses.

First American, the second-biggest title insurer, was supposed to protect the bank against defective titles on home- equity loans and lines of credit, according to the suit, filed March 5 in a North Carolina court. The suit focuses on loans in which Bank of America relied on a borrower’s word regarding any outstanding liens or mortgages, the suit said.

Home lenders are sparring with mortgage insurers, bond investors and Fannie Mae and Freddie Mac over who should bear the cost of record defaults. Bank of America, the biggest U.S. lender by assets, said last week it’s writing off $1.5 billion to $2 billion of unpaid home-equity loans each quarter, and has sued MGIC Investment Corp., the biggest mortgage insurer, for allegedly denying millions of dollars of claims.

The policies described in the First American case sound like “liar’s title insurance,” similar to the “liar loans” common among subprime lenders in the middle of the last decade, said Jack M. Guttentag, chairman of GHR Systems, a consulting firm in Wayne, Pennsylvania. Liar loans are industry slang for mortgages made to borrowers who inflated their income on applications that weren’t verified by lenders.

Lenders such as Charlotte, North Carolina-based Bank of America bought “lien protection” plans as a faster, cheaper approach for home-equity loans than full title insurance policies as housing sales soared in the mid-2000s. Full title insurance typically involves an independent check by the insurer on whether the title might face competing claims for ownership or financial obligations.

2,000 Letters

The American Land Title Association, a trade group representing title insurers, opposed some of the lien-protection plans because they offered less legal protection than traditional title insurance.

First American denied or ignored most of Bank of America’s claims in 2008 and 2009, according to the lawsuit. Last August, Santa Ana, California-based First American started sending more than 2,000 letters to the bank seeking information and documents related to the claims, the suit said.

First American subsidiaries “regret that their valuable customer, Bank of America, has chosen to file a legal action against the companies,” spokeswoman Carrie Gaska said in an e-mailed statement. “We are hopeful that we will be able to resolve this matter outside of court with continued discussions.”

The suit was filed in Mecklenburg County Superior Court in Charlotte. Bank of America spokeswoman Shirley Norton had no comment.

MGIC has said it will defend itself against Bank of America’s lawsuit, which was filed by the lender’s Countrywide unit. Bank of America ranked second last year in home mortgage lending behind Wells Fargo & Co.

–With assistance from John Gittelsohn in New York. Editors: William Ahearn, Rick Green

To contact the reporter on this story: David Mildenberg in Charlotte at dmildenberg@bloomberg.net

To contact the editor responsible for this story: Alec McCabe in New York at amccabe@bloomberg.net