Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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H. Gosh

Cuomo Widens Investigation to Fannie Mae, Freddie Mac (Update1)

By Alan Mirabella

Nov. 7 (Bloomberg) -- New York Attorney General Andrew Cuomo is expanding his investigation of the mortgage industry to include Fannie Mae and Freddie Mac, the two biggest U.S. providers of mortgage financing. Fannie Mae and Freddie Mac shares fell.

Cuomo said in an e-mail today that he plans a news conference in New York City for 12 p.m. Last week, Cuomo sued the real estate appraisal unit of First American Corp., the biggest U.S. title insurer. Cuomo accused the appraiser of inflating home values under pressure from Washington Mutual Inc. The eAppraiseIT LLC unit gave in to demands for higher appraisals to secure more of Washington Mutual's business, Cuomo said.

Cuomo will announce ``a significant new development in his expanding investigation into the mortgage industry involving Fannie Mae and Freddie Mac,'' the statement said.

States including California, Colorado, Ohio, and Connecticut have been investigating the mortgage industry as foreclosures rise nationwide. A borrower who gets a home loan based on an inflated appraisal and falls behind on payments would have difficulty selling or refinancing for enough to pay off the mortgage.

Fannie Mae spokesman Brian Faith and Freddie Mac spokesman Douglas Duvall declined to immediately comment.

Corinne Russell, spokeswoman for the Office of Federal Housing Enterprise Oversight, declined to comment. The agency is the federal regulator in Washington for Fannie Mae and Freddie Mac.

Fannie Mae fell 3.7 percent to $53.34 in New York Stock Exchange composite trading at 9:41 a.m. Freddie Mac fell 3.4 percent to $47.70.

Nine-Month Investigation

Cuomo conducted a nine-month investigation and said last week the evidence against First American is ``damning.'' It includes e- mails between executives at the appraisal company and Washington Mutual that show eAppraiseIT ``willingly violated'' state and federal regulations that call for independent home appraisals.

The appraiser did 262,000 valuations over the past 18 months for Washington Mutual, the biggest U.S. thrift, and earned $50 million, Cuomo said.

In March, Cuomo, 49, said he was investigating the subprime mortgage market in response to the surge in mortgage delinquencies. In May, he subpoenaed real estate appraisers Mitchell, Maxwell & Jackson Inc. and eAppraiseIT, as well as the broker Manhattan Mortgage Co.

Within a month, Cuomo subpoenaed records from Vanderbilt Appraisal Co. LLC, which is owned by Terra Holdings, a real estate company whose principals include New York developers Arthur and William Lie Zeckendorf.

In September, credit rating companies Standard & Poor's and Fitch Ratings said they were subpoenaed by Cuomo. Fitch said its subpoena demanded information on residential mortgage-backed securities and collateralized-debt obligations, which hold mortgage-backed securities.

To contact the reporter on this story: Alan Mirabella in New York at amirabella@bloomberg.net .

Last Updated: November 7, 2007 09:46 EST

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Stephen

Cuomo's on the right track.

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He is almost their, when he and other states begin looking at the "Manufactured Foreclosure's" that's when I will know he is their!   He has the information, and thousands of documents supporting it.  CBASS is in New York, so he has the jurisdiction he needs for them.
 
Several investigators from his office and other offices are working on the connections, its so damn hard to believe they are so far behind in the information curve.
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Nye Lavalle
Cuomo Subpoenas Fannie Mae, Freddie Mac, on Washington Mutual
By Karen Freifeld and James Tyson

Nov. 7 (Bloomberg) -- New York Attorney General Andrew Cuomo subpoenaed Fannie Mae and Freddie Mac, the two biggest U.S. providers of mortgage financing, seeking information on loans they bought from banks including Washington Mutual Inc.

Cuomo said he uncovered a ``pattern of collusion'' in appraisals on Washington Mutual loans. Shares of Washington Mutual tumbled.

The subpoenas also seek information on the due diligence practices of Fannie Mae and Freddie Mac and their valuations of appraisals. Cuomo last week sued the real estate appraisal unit of First American Corp., the biggest U.S. title insurer, accusing it of inflating home values under pressure from Washington Mutual.

``In order to fulfill their duty to consumers and investors, Fannie Mae and Freddie Mac must ensure that Washington Mutual's mortgages have not been corrupted by inflated appraisals,'' Cuomo said in a statement on his office's Web site.

Fannie Mae and Freddie Mac own or guarantee 40 percent of the $11.5 trillion of U.S. residential mortgage debt. The companies agreed to allow a review of Washington Mutual appraisals, Cuomo said.

To contact the reporter on this story: James Tyson in Washington at at jtyson@bloomberg.net ; Karen Freifeld in New York at kfreifeld@bloomberg.net

Last Updated: November 7, 2007 12:16 EST
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