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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Jim Sinclair’s Commentary

France had Joan of Arc, we have Marie McDonnell.

Dear Jim,

I want to alert you and your CIGA’s to my most recent audit of the Essex Southern District Registry of Deeds, commissioned by Registrar John O’Brien. Please read the press Release and my audit findings attached hereto.

Here are some key quotes from me:

Salem, MA
June 29th, 2011

Kevin Harvey, 1st Assistant Register

Marie McDonnell, President, McDonnell Property Analytics, Inc.

Southern Essex Registry of Deeds Audit Reveals That 75% of Assignments of Mortgage Are Invalid; O’Brien Says Banks Responsible for an Epidemic of Fraud. Once again urges Attorney’s General to stop Bank settlement talks.

Yesterday at the Annual Conference of The International Association of Clerks, Recorders, Election Officials and Treasurers (IACREOT), Register John O’Brien revealed the results of an independent audit of his registry. The audit, which is released as a legal affidavit was performed by McDonnell Property Analytics, examined assignments of mortgage recorded in the Essex Southern District Registry of Deeds issued to and from JP Morgan Chase Bank, Wells Fargo Bank, and Bank of America during 2010. In total, 565 assignments related to 473 unique mortgages were analyzed.

McDonnell’s Report includes the following key findings:

  • Only 16% of assignments of mortgage are valid
  • 75% of assignments of mortgage are invalid.
  • 9% of assignments of mortgage are questionable
  • 27% of the invalid assignments are fraudulent, 35% are ”robo-signed” and 10% violate the Massachusetts Mortgage Fraud Statute.
  • The identity of financial institutions that are current owners of the mortgages could only be determined for 287 out of 473(60%)
  • There are 683 missing assignments for the 287 traced mortgages, representing approximately $180,000 in lost recording fees
  • per 1,000 mortgages whose current ownership can be traced.

McDonnell told O’Brien, “I have been auditing residential mortgage loans for the past twenty years on a one-by-one basis. In the process, I have been cataloging the ramp up in predatory lending and mortgage fraud for all of those years, but I was not prepared for the shocking results of my audit. What this means is that the degradation in standards of commerce by which the banks originated, sold and securitized these mortgages are so fatally flawed that the institutions, including many pension funds, that purchased these mortgages don’t actually own them because the assignments of mortgage were never prepared, executed and delivered to them in the normal course of business at the time of the transaction. In a blatant attempt to engineer a ‘fix’ to the problem, the banks set up in-house document execution teams, or outsourced the preparation of their assignments to third parties who manufactured them out of thin air without researching who really owns the mortgage.”

O’Brien asked McDonnell what this means for his constituents. “It is vitally important for your constituents to know that if they are in foreclosure now or if their homes have been foreclosed upon, they can stop the foreclosure from proceeding, or institute a court action to vacate a completed foreclosure.

The MA Supreme Judicial Court has established the law of the land in its decisions U.S. Bank, N.A. v. Ibanez and Wells Fargo Bank, N.A. v. LaRace and I can tell you that every single assignment of mortgage that was recorded for the purpose of foreclosing the homeowner is invalid, overtly fraudulent, or criminally fraudulent. My findings also show that your constituents who are not in foreclosure, and have never been delinquent in their payments also have clouds on title due to the recording of defective and invalid discharges and assignments of mortgage.”

“My registry is a crime scene as evidenced by this forensic examination,” stated John O’Brien.

“This crime that has affected thousands of homeowners in Essex County who, through no fault of their own, have had their property rights trampled on and their chain of title compromised. This evidence has made it clear to me that the only way we can ever determine the total economic loss and the amount damage done to the taxpayers is by conducting a full forensic audit of all registry of deeds in Massachusetts. I suspect that at the end of the day we are going to find that the taxpayers have been bilked in this state alone of over 400 million dollars not including the accrued interest plus costs and penalties. The Audit makes the finding that this was not only a MERS problem, but a scheme also perpetuated by MERS shareholder banks such Bank of America, Wells Fargo, JP Morgan and others. I am stunned and appalled by the fact that America’s biggest banks have played fast and loose with people’s biggest asset – their homes. This is disgusting, and this is criminal,” said O’Brien.

O’Brien continued “Once again I am asking Attorney General Martha Coakley and the other state Attorney’s General to follow the lead of New York Attorney General Eric Schneiderman and stop any settlement talks with the banks. The results of this report are only for my registry, but I can assure you that this type of criminal fraud is rampant across the nation. This leaves me to question why anyone would consider settling with these banks until we know the full extent of the damage that they have caused to the homeowners chain of title across this country and the amount of money they have bilked the taxpayers for their failure to pay recording fees.”

The Full Report is included with this release and may also be requested at

CIGA Marie
(CIGA - Comrades in Golden Arms)

Marie McDonnell, President

Truth In Lending Audit & Recovery Services, LLC
Mortgage Fraud and Forensic Analyst
Certified Fraud Examiner
P.O. Box 2067, Orleans, MA 02653
Tel. (508) 694-6866 Fax (508) 694-6874

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Loinel Tribbey
Didn't Joan end up burned at the stake?

Are Democrats Doing More Harm To Homeowners Than Republicans?

                                                        Jun 26, 2011   //   by Steve Dibert   //   Massachusetts, Michigan, Steve's Blog  //  No Comments                                                

Steve Dibert, MFI-Miami

I’ve been involved in Democratic Party politics on and off for most of my adult life and what amazes me about the majority of 21st century Democratic politicians is that the majority of them have virtually no knowledge of the basic mechanics of finance and banking.  When I try to educate them, they look at me with a blank look and then dismiss me like they know everything when in reality they know almost nothing.

The problem is they assume that they know enough to get by and because they are an elected official, it’s enough information for them to take on the banks.  What makes it worse is most of them have no interest in learning more of how the system works.

Here’s a perfect example, last month when MERS executive, Bill Hultman gave testimony to the Michigan House Banking Committee, Ingham County Register of Deeds, Curtis Hertel, Jr. and I gave Democrats and Republicans on the committee hard hitting questions to ask him.   We knew the Republicans wouldn’t ask these questions since they wouldn’t want to bite the banking lobby’s hand that feeds them.  We had hoped the Democrats would take advantage of the opportunity to grill one of the key players in destruction of the housing market.  Especially since the hearing was being blasted live on the web.   We even put bullet points on the sheets so the members would understand the questions and appear more educated than Mr. Hultman.  In the video, the Democrats on the Committee sat there mute and refused to ask a single question.

I was baffled by the fact that not a single Democrat opened their mouth.  This became even more troubling when Republican Chairman, Marty Knollenberg commented after the hearing about how he had no idea what MERS was until two months before hearing.  Why aren’t they standing up, holding press conferences or calling for his removal?

Joe DiSano, a Democratic Political Strategist based in Michigan appeared on the Tony Trupiano Show in Detroit the other day and made an interesting observation, “I think there is a question if the Democrats are going to take advantages of the missteps from the opposing party.  Democrats are not known to take advantage of those opportunities…”

It appears that aside from not knowing anything about finance and banking, Michigan Democrats have never studied military history.  Here’s a phrase that Michigan Democrats politicians need to memorize and live by, L’audace, l’audace, toujours l’audace!

Then you have the other side of the coin, Democratic politicians in other states who embrace L’audace, l’audace, toujours l’audace! to an extreme and become so blinded by wanting to do the right thing when it comes to helping homeowners that they lose all sense of reality and don’t do the smart thing.   Politicians armed with only limited knowledge of banking and their own naivete can lay the groundwork for a disaster of biblical proportions.

Doing the smart thing is critical especially when litigation or public policy is involved because one poorly crafted lawsuits, piece of litigation or public relations stunt by an inept attorney or politician can set a dangerous precedence that can ripple across the country affecting hundreds of thousands of homeowners.

This is exactly what is going on in Massachusetts.

In Massachusetts, The Southern Essex County Register of Deeds, John O’Brien is so obsessed with exposing robo-signing that he has bombarded the media with press releases for the past six months.

The most interesting one being the one in February where he claimed MERS owed the Southern Essex District nearly $22.3 million in unpaid recording fees.  This number is based on the claim that the mortgage was assigned twice in the MERS system.  This is unlikely because in the nearly 500 mortgage investigations MFI-Miami has done involving MERS mortgages only two have been assigned multiple times in the MERS system.  Usually the mortgage goes in and comes comes out when being assigned into a mortgage pool or when it is publicly recorded prior to a foreclosure.   I will give O’Brien huge kudos for bringing MERS into the spotlight even though I believe his math is flawed.

O’Brien has also teamed up with a Marie McDonnell, a forensic mortgage examiner on Cape Cod.  Now, I normally don’t write about competitors because I find it in bad taste but in this case, I’m making an exception.  If you continue reading this article you will understand why.

This is a woman who was once chastised by a judge for unlicensed practice of law and was then lectured by the judge in the case for putting her own interests ahead of her client’s.

Mike Dillon who operates a public records search business and operates the mortgage fraud advocacy site, also shares a similar story on his website about Marie McDonnell.

She markets the investigation work she did on the Ibanez/LaRace cases as the crown jewel of her career.   Thanks mainly to the hard work of other people like attorney Glenn Russell, the cases received a favorable ruling from the Massachusetts Supreme Judicial Court.

However, what she doesn’t tell people is that she was kicked off the case as an expert because she lacked a finance or mortgage background and the research she provided had to be re-done and certified by someone else. She heavily promoted her involvement in this case before it went to the SJC and ran the risk of looking foolish because of her removal.  In order to save face, she filed an Amicus Curiae in the case.

She then promoted this Amicus Curiae as if it was the linchpin that held this case together and that it was the secret weapon that caused the SJC to hear the case.  When in reality, it had no bearing on the case or the favorable outcome.

Again what she doesn’t tell people is that anyone can file an Amicus Curiae in a case.  It’s nothing more than an unsolicited opinion filed on a pending court action from the general public. She used it as a marketing ploy to solicit homeowners ignorant of the law and to increase her presence with the online foreclosure activist community.

She also has a history of lifting other people’s research and claiming it as her own.  She did this several months ago using an investigation that MFI-Miami did into robo-signing at Orlans Associates and Orlans Moran.  When she was confronted about it she openly admitted to taking MFI-Miami research and used it in her solicitation material to several Register of Deeds across the US.

Don’t get me wrong, John O’Brien is an okay guy and a great public servant, but unfortunately like most other Democrats it appears he believes in some Utopian Fantasy World inspired by 40 year old John Lennon music or the dusty writings of Bobby Kennedy.  He thinks because some one offers their services for free, they are looking out for their neighbor or want to hold hands in a circle and sing Ladysmith Black Mambazo songs.    In many cases, this is not true.  After all, free advice is seldom cheap.   There are plenty of opportunists who want to take advantage of a politician’s trust and play on their vanity if there is a chance for profit.

I admit I’m a cynic which is why I gave up my Democratic Party membership nine years ago.  I gave up believing what people tell me.  It could be from the hypocrisy of politics, the cut throat nature of the mortgage industry or watching too many David Lynch movies but I’ve come to believe none of what I’m told and only half of what I see.

Democratic politicians need to understand that people are better served when our elected officials stand up and do the smart thing politically.  Not what they feel is the right thing.  The first smart thing they can do is to get educated about how mortgage lending works and who the players are instead of just simply jumping on the bandwagon of bashing Linda Green and DocX.  They then need to stand up, ask questions and demand answers from the banks.

If you ask the majority of the politicians from both sides of the political aisle who hires companies like DocX, LPS, or NTC chances are Curtis Hertel, Jr. is the only one who knows the answer.

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Joan of Arc was in yesterday past.

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Loinel said:

This is unlikely because in the nearly 500 mortgage investigations MFI-Miami has done involving MERS mortgages only two have been assigned multiple times in the MERS system.

Maybe you should apply to law what you just wrote.

Securitization requires multiple of true sales of the mortgage note, thanks for the professional information.

Now people may understand why I recommend nobody!
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William A. Roper, Jr.
I found the post by Lionel of Steve DIBERT's commentary to be rather interesting.  I had wondered about Marie McDonnell's credentials, but hadn't done any due diligence.  Though I haven't heard directly from Mike DILLON about Marie, Steve Dibert's link to Mike's commentary is instructive:

Mike DILLON's longstanding credentials as a foreclosure defense activist are beyond reproach.  Mike is both thoughtful and trustworthy!

While I think some of Ms. McDonnell's assertions about her study of Essex assignments might be true, without reading the actual report and understanding her definitions and methodolgy, it is hard to be confident.  I am absolutely confident that the bulk of mortgage assignments recorded in Essex or any other Massachusetts jurisdiction are forgeries.

Even if the report were meritworthy, this is not necessarily a validation of either Ms. McDonnell's credentials as a forensic loan auditor nor the value of such an audit for a borrow.  I would encourage Forum participants to read Mike's assessment and to proceed with caution!
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 Any knowledgeable attorney will tell you these TILA, RESPA,  audits are basically worthless. They will also tell you, "securitization," "MERS," arguments will only STALL foreclosures, so they are basically useless as well.

The only methodology that will EVER get the homeowner any financial settlement from the banks or their house free & clear is to find contract breaches and/or tortuous conduct in the mortgage transaction, which by the way is a contract.

That's why 99% of the loan audit companies are basically ripping off homeowners.

Mortgage Fraud Examiners exposed this problem of bogus forensic loan audits over two years ago in a press release: "Beware of the Latest Foreclosure Rescue Scam—“Forensic Loan Audits."


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