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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ABC News: “60 Minutes” Greenspan Failed to See Mortgage Mess 

Greenspan Failed to See Mortgage Mess. ... how significant they had become until very late," he said in a CBS "60 Minutes" interview to be broadcast Sunday January 27, 2008

Greenspan Failed to See Mortgage Mess

Greenspan Acknowledges He Failed to See Early on the Risks of 'Subprime' Mortgages  -  See Early on the Risks of 'Subprime' Mortgages


Alan Greenspan
(Getty Images)

(Getty Images)

The Associated Press

By JEANNINE AVERSA AP Economics Writer

Former Federal Reserve Chairman Alan Greenspan acknowledges he failed to see early on that an explosion of mortgages to people with questionable credit histories could pose a danger to the economy.

In an upcoming interview, Greenspan said he was aware of "subprime" lending practices where homebuyers got very low initial rates only to see them later jacked up, causing severe payment shock. But he said he didn't initially realize the harm they could do.Top of Form

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"While I was aware a lot of these practices were going on, I had no notion of how significant they had become until very late," he said in a CBS "60 Minutes" interview to be broadcast Sunday. "I really didn't get it until very late in 2005 and 2006," Greenspan said.

An excerpt of the interview was released Thursday.

A meltdown in the subprime mortgage market has rocked Wall Street. Foreclosures and late payments have soared and lenders have gone out of business. Nervous financial institutions tightened credit standards, making it harder for even more creditworthy borrowers to get financing. This has increased chances the economy might slide into a recession.

Greenspan, who ran the central bank for more than 18 years the second-longest serving chairman in history left in 2006. His successor, Ben Bernanke, has had to deal with a credit and financial crisis stemming from the subprime mortgage mess.

When he was at the helm, Greenspan maintained there was little the Fed which also oversees the safety and soundness of banks could do about the subprime situation. One of the Fed's governors, however, had raised a red flag about questionable lending practices.

"Well, it was nothing to look into particularly because we knew there was a number of such practices going on, but it's very difficult for banking regulators to deal with that," Greenspan said in the interview.

Some blamed Greenspan's interest rate policies for feeding the housing frenzy. Sales had hit record highs and house prices galloped from 2001 to 2005. Then the market fell into a deep slump.

Greenspan Failed to See Mortgage Mess


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Ed Cage  |  1804 Cross Bend, Plano Texas 75023  |  972-596-4363  |




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Tuesday, January 22, 2008

"Greenspan mess" sightings accelerate sharply

This editorial by Barrie McKenna in today's Globe & Mail contains one more in a growing list of recent "Greenspan mess" sightings. It's a good summary of the many sins of the former Fed chairman, so it is reproduced in its entirety (the picture comes from my personal collection, just to liven things up a bit - it's one of my favorites, but the one where he is proudly receiving a medal from "W" probably tops the list).

Did Greenspan sell out investors?
As global markets melt like a slab of butter on a hot frying pan, it's about time to figure out who cranked up the stove.

Where's Alan Greenspan, anyway?

Apparently, he anticipated our unwanted scrutiny.

The former U.S. Federal Reserve Board chief has taken great pains to shift blame for the mortgage crisis away from himself and the Fed's low-interest jet fuel of the 2001-04 period.

The maestro's take: A post-Cold War economic boom in the developing world produced a dangerous underpricing of risk on a global scale that no one - not even the Fed - could control.

Don't look at me, Mr. Greenspan argues. Blame China or India.
"The crisis was ... an accident waiting to happen," Mr. Greenspan wrote in a lengthy op-ed piece in the Wall Street Journal in mid-December. "If it had not been triggered by the mispricing of securitized subprime mortgages, it would have been produced by eruptions in some other market."

In other words, the Fed didn't push interest rates lower, the global economy did. China and other countries flooded the West with cheap products, kept wages low in developed countries and pushed down inflation expectations everywhere. Central banks lost control of long-term rates.

And lower interest rates sent asset prices - for stocks and real estate - sharply higher.

"There was clearly little the world's central banks could do to temper this most recent surge in human euphoria," Mr. Greenspan rationalized.

The explanation - like most of what Mr. Greenspan has to say - is thought-provoking. But perhaps just a tad too convenient.

Even if you accept Mr. Greenspan's argument that the Fed wasn't the source of all the easy money, it's tough for him to hide from the reality that he was a cheerleader for a mortgage industry gone wild.

He, along with George W. Bush, was an outspoken advocate for dramatically increased home ownership. And millions of Americans bought homes for the first time during the Greenspan years, fuelling a massive building boom. Many of those homes are now in foreclosure, housing starts have collapsed and prices are falling in most markets.

In a remarkable February, 2004, speech to a gathering of credit union executives, Mr. Greenspan lavished praise on now toxic adjustable-rate mortgage products. The apparent message to home buyers: They'd be crazy not to take the easy money.

Many of those 2004 mortgages, which started with low teaser rates, are now swamping naive homeowners as they reset to unaffordable higher levels.

So who was responsible for the low rates that made these mortgages possible? Even Mr. Greenspan acknowledges that the Fed's record 1-per-cent benchmark interest rate in mid-2003 boosted these exotic mortgages and raised home prices.

Mr. Greenspan conveniently ignores the Fed's other role - as a banking regulator. When the economic history is written, the conclusion may be that the Fed's biggest failing in the Greenspan era is what it didn't do, not what it did.

The Fed, which doesn't directly regulate the mortgage industry, nonetheless turned a blind eye to a host of obvious lending excesses, which caused systemic risk to the banking industry. Fed officials also watched as Wall Street financial alchemists ran amok, inexplicably turning junk mortgages into credit-worthy bonds.

And the Fed stood by as the major banks, brokers and hedge funds embraced this hazardous mortgage market. Indeed, Mr. Greenspan, a libertarian, argued against stricter hedge fund regulation, even after the 1998 collapse of Long Term Capital Management.

There may well have been "mispricing of risk" around the world, as Mr. Greenspan argued. But there was also plenty of evidence of recklessness closer to home, and scant effort to rein it in.

Ben Bernanke, an academic who succeeded Mr. Greenspan in early 2006, is now left to mop up the economic mess. Unlike Mr. Greenspan, the new Fed chief has been reluctant to reward the risk takers with knee-jerk interest rate cuts. He has also urged much stricter lending standards for the mortgage industry.

Mr. Greenspan, meanwhile, earns a tidy living selling his advice to the industry he failed to keep in check while he was a central banker. He makes speeches to financial groups for six-figure fees. He sells his consulting services to the likes of bond giant Pimco and Paulson & Co., a New York hedge fund. - (that profited hugely by shorting subprime)

The current crisis isn't the making of one man.

But it's fair to say that Mr. Greenspan was a participant in the age of easy money, not just an accidental witness.The Maestro was left off way too easy there at the end.

A conclusion starting with, "In the fullness of time, history may judge the early 21st century as the seminal failure in central banking that led to ..."  Or something like that.

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Allen Greenspan literally wrote the book on how the Federal Reserve and fractional reserve money was a giant Ponzi sheme designed to artificially support the welfare state to create a permanent cash cow for the elites.

He explained the great depresion which may soon be renamed an economic speed bump was created by a speculative expansion in the economy followed by a contraction in credit and a revision in monetary policy designed to transfer gold and wealth to England. The Federal reserve members wanted make it appear as if capitalism was failure and unstable and make it appear as if social programs in England were designed to help the public rather than as a mechanism to create wealth transfer to the rich and enslave the general public in debt. 

He sold out to the corporate looting free for all supported by the Clintons amoung others with the repeal of the Glass-Stegal act created to  prevent another speculative boom bust cycle experienced in the great depresion.
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60 Minutes
"Mortgage Mess" report airs Sunday, Jan. 27, at 7 p.m. ET/PT.

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They still haven't exposed the core of the fraud.  Brokers and appraisers.  Wall St. bought junk.  Who created it?  The real estate and mortgage industry.

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I watched it and thought it was really a shame the way it was done.  Nothing was mentioned about the fraud and it really seemed that the focus was on Wall Street and people buying houses and not being able to pay for them.  we need someone to really get to what has happened and do an hour program on the crooks and not just mention the the people by their names and give their phone numbers and addresses....Let everyone what crooks they are and where they are at and how to get in touch with them.

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I have 6 folders and phone records to boot.


Ann Holden
1050 Shadybrook Dr
Akron, Ohio

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Ann if you have some important information I encourage you to go to

60 Minutes. They do some follow up if the information is good enough.

It's up to us to keep the journey to justice rolling.

      I was mildly disappointed in Steve Kroft's lack of understanding or

even modest coverage of mortgage *servicing* fraud which is the primary

interest of this forum. It did make it appear that the focal point was only

borrowers who got in over their heads which is not our beef by a long

shot. We are primarily concerned with criminal fraud and here both Kroft

and 60 Minutes fell short in my view.

      There was an excellent site that was put forward:

This site shows how serious the problem really is in the Stockton CA area.

      Additionally it was exposed to the mainstream public that both Bear Stearns

and Merrill Lynch were major players in bundling (camouflaging) the very risky

subprime notes with less dubious securities then selling them to unsuspecting

investors and funds. Yes folks, that is indeed, criminal fraud.



      Another burning question left unanswered by Kroft and 60 Minutes was

how in hell Standard and Poor got away with rating this garbagé as AAA.



Ed Cage  |  Plano Texas  |  |  972-596-4363


House Of Cards: The Mortgage Mess

Steve Kroft Reports How The Mortgage Meltdown Is Shaking Markets Worldwide


Play Video

House Of Cards

Steve Kroft reports on how the U.S. sub-prime mortgage meltdown, in which risky loans drove a housing boom that went bust, is now roiling capital markets worldwide. |

(CBS) It was another nervous week for the world's financial markets and for Wall Street. In the last six months, Americans have seen their investments shrink, their property values plummet, and the country edge closer towards a recession. At the heart of the problem is something called the subprime mortgage crisis, which began last summer and continues to ricochet through the economy.

It sounds complicated, but it's really fairly simple. Banks lent hundreds of billions of dollars to homebuyers who can't pay them back. Wall Street took the risky debt, dressed it up as fancy securities, and sold it around the world as safe investments. It sounds like a shell game or Ponzi scheme; in some ways, it was a house of cards rife with corruption, greed, and negligence.

And as correspondent Steve Kroft reports, it started in places like Stockton, Calif.

Stockton is a city of 280,000 people in the Central Valley; 80 miles east of San Francisco and 80 miles north of San Jose. In many ways, this is ground zero for the current financial crisis and a microcosm of everything that went wrong.

A few years ago, it was one of the hottest real estate markets in the country; today it is the foreclosure capital of America.

Real estate agent Kevin Moran represents 102 properties and says all of them are in foreclosure.

Moran gave Kroft a tour of the wreckage in one subdivision called "Weston Ranch," with block after block of vacant and abandoned houses.

"If you see a 'for sale' sign in this neighborhood, that probably is a sign of distress, right?" Kroft asks.

"I would say that, yeah. Two out of three of all the sales are probably foreclosed properties, and/or people who are in distress," Moran explains.

The "for sale" signs and the overgrown lawns in Weston Ranch only show part of the picture. To get a real overview, you need to look at a map from Sean O’Toole's Web site,, which tracks distressed properties in Stockton and other California communities.

"The light blue circles are folks that have gone into default. And that means that's the first step of the foreclosure process," O'Toole says, explaining how his maps color-code properties. "The dark blue is auction properties. And the red icons are properties that were sold at auction, had no bid, and therefore went back to the lender."

As of last week, there were 4,200 Stockton homes either in default or foreclosure; $1.4 billion in bad loans in just one California community, and it is far from over.

"Two months from now, what's this map gonna look like? How many of those light blues are gonna be red?" Kroft asks O'Toole.

"We'll probably see at least 60, 70 percent of these light blues turn red. And we'll see at least this many light blues again," O'Toole predicts.

Banks are auctioning off houses all over California and in South Florida, in Nevada, and in parts of Ohio and Texas, the result of a huge real estate bubble that began forming in Stockton back in 2003, when people priced out of the Bay Area and Silicon Valley discovered that you could buy a four-bedroom home there for just $230,000.

Developers started turning asparagus fields into subdivisions, and lenders handed out free money to anyone who wanted to buy.

"What do you mean by free money?" Kroft asks Jim Grant, the editor of "Grant's Interest Rate Observer" and one the country's foremost experts on credit markets.

"I mean free money. I mean you had to apply not to get a loan, almost. Sometimes you have to apply to get a loan, you almost had to apply not to get one," Grant says.

"When you opened your mailbox in 2004, 2005, you could barely -- people were pressing on you, if you were not institutionalized, all matters of schemes in which to expand your personal debt and mortgage debt. You could, and people did, borrow more than 100 percent of the price of a house with the most fragile of financial bonafides," Grant explains.

Most of the mortgages issued in Stockton, and half of those now in default or foreclosure, were something called subprime loans, meaning less than prime quality. The borrowers often had sketchy credit, were financially strapped or lacked sufficient income to qualify for a standard mortgage. After a year of artificially low payments, the interest rates on subprime loans jumped all the way to ten or 11 percent.

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Produced By L. Franklin Devine and Jennifer MacDonald
© MMVIII, CBS Interactive Inc. All Rights Reserved.

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