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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The first time they endorse it with the w/o recourse stamp it is to pay themselves and most likely they convert the instrument. The second endorsement is usually when it is sold to pool. But what I have learned using those, "I created the cash" arguments seem to get you know where.... So lets look at this from a standpoint in which they cannot slither out of. If we can figure out what is happening between the first endorsement and the 2nd to the pool and or what and how the pool was set up..... I guarantee that there are some federal questions, and a valid federal question on it's face calls for a default judgment and the contract is Ultra Vires.

UCC 3-203

(b) Transfer of an instrument, whether or not the transfer is a negotiation, vests in the transferee any right of the transferor to enforce the instrument, including any right as a holder in due course, but the transferee cannot acquire rights of a holder in due course by a transfer, directly or indirectly, from a holder in due course if the transferee engaged in fraud or illegality affecting the instrument.

But I still dont know if they are selling unregistered securities?

The long and short of it is the procedural court rules don't outweigh substantive due process law. For instance, a foreclosure complaint ladden with FDCPA violations showing it was filed using deceptitve technigues of untrue copies and false swearing couched in words of art should be halted from the outset not rumberstamped, as common professional courtesy.

Once again, a use of the forest to hide the trees. Did your attorney friends point out the fraud on the court in all of these 99% foreclosure proceedings. Plain and simple an alleged loan tranasction, as sold to the people, doesn't bear the slighest resemblance to the way banks are mandated to record those transactions on their books.

Just like blaming the alleged current economic crisis, land grab, on the victims of the predatory lenders (who've been paid several times over) yet still feign financial distress. I guess we're suppose to believe the derivatives vacum sucked up all the phanthom funds.

Looks like the emperor has no clothes.

what they should have done is register the note with the county recorder. Using the Registered Mail number makes it a registered security:

All commercial instruments such as promissory notes, credit agreements, bills of exchange and checks are defined as legal tender, or money, by the statutes such as 12 USC 1813(l)(1), UCC §1-201(24), §3-104, §8-102(9), §§9-102(9), (11), (12)(B), (49), (64). These statutes define a promissory note or security to be negotiable (sellable) because it is a financial asset. This is necessary because contracts requiring lawful money are illegal pursuant to Title 31 USC §5118(d) (2). All debts today are discharged by promises to pay in the future. All Federal Reserve notes are registered securities and promises to pay in the future. They are secured by liens on promissory notes of collateral owned by real people. The statutes do not provide the Federal Reserve Corporation a monopoly on promissory notes, as debt collectors insist. Real people create promissory notes that are usually sold to the FED in exchange for their promissory notes. The FED uses the promises of the people’s collateral to secure their notes. If people want their commercial instruments to be legal tender, they must be secured by a maritime lien on your prepaid trust account recorded at the county and registered on a UCC1. It then becomes a registered security and a financial asset that can be negotiated.
One should be aware that debt collectors only deal with fictions of law, such as corporations or “persons”. Therefore, one should have a Bailee/Bailor contract filed on a UCC1 and create all documents as the Bailee, signed by the Bailor. The Bailor is never allowed to appear in their jurisdiction.
When quoting UCC statutes, the courts require them to be quoted with state or federal statute designation. UCC codes are UN statutes, but are codified in every local jurisdiction. In Minnesota, a code such as UCC §2-302 becomes Minnesota Statute 336.2-302.
The counterclaim is based on several defenses:

The contract should be rescinded because the creditor does not provide full disclosure, or the contract is extremely deceptive and unconscionable, In re Pearl Maxwell, 281 B.R. 101

The Truth in Lending Act, Regulation Z, 12 CFR §226.23, says that the security agreement signed with a lender can be rescinded if they have not provided the proper disclosures. Although home mortgages are exempt from some rescissions, this option becomes available if they foreclose and they stated the incorrect amount of the debt, or used the wrong form. The original debt was actually zero because the borrower’s financial asset was exchanged for the FED’s promissory notes in an even exchange.

The Fair Debt Collection Practices Act 15 U.S.C. §§1601, 1692, 1693, provides remedies for deceptive or unconscionable contracts and allows payment in any legal tender. The contract was deceptive and unconscionable if the actual debt was zero.

Real Estate Settlement Procedures Act 12 U.S.C. §2605, et seq. Provides remedies for deceptive communications from the lender.


UCC §2-302 provides a remedy for unconscionable contracts.




Promissory Notes and other commercial instruments are legal tender and financial assets to the originator and a liability to the lender. If a security interest in the note is perfected, by recording it on a lien as a registered security, the maker or originator becomes an entitlement holder in the asset. But the debt collector does not understand that they have this liability because most people are unaware of it.

The corporation’s records should be requested in discovery. They will show that the corporation has an offsetting liability to the debtor pursuant to FAS 95, GAAP and Thrift Finance Reports (TFR). These records include:

FR 2046 balance sheet,

1099-OID report,

S-3/A registration statement,

424-B5 prospectus and

RC-S & RC-B Call Schedules

The corporation never registers the commercial instrument because they know it is a financial asset to the debtor. So the debtor must register it to establish a security interest in the financial asset and take the position of a secured creditor. So it should be listed on a maritime lien against the prepaid trust account and filed with the county recorder and put on a UCC1.

§8-102(13), §9-203; §9-505, §9-312.

46 USC §§31321, 31343, 46 CFR 67.250, §9-102(52), §9-317, §9-322

One should file a claim for set off or recoupment to have the assets cancel out the liabilities according to:

FAS 140, §3-305, §3-601, §8-105, §9-404

If a lender sells an unregistered note that is a security, it is a violation of state law and provides a right to rescission of the contract pursuant to Minnesota Statutes 80A.80, 336.9-318, 336.9-408

The prepaid trust account is held by the Alien Property Custodian, who is also the Secretary of Treasury of Puerto Rico.

UCC §1-201(24), §3-104, §3-306, §3-105,

UCC §§8-102 (7), (9), (15), (17), §8-501, §8-503, §8-511

UCC §§9-102(9), (11), (12)(B), (49), (64)

12 USC 1813(l)(1)

I see your process I know of some of the technology that you stated here by registering the notes initially on a ucc-1 and then assigning them on a ucc-3 to each bank for set off.. I understand Reg z and the 35 dollar rule for tolerance for disclosures three year right to rescind.

2) TOLERANCE FOR DISCLOSURES.--Notwithstanding section 106(f), and subject to the time period provided in subsection (f), for the purposes of exercising any rescission rights after the initiation of any judicial or non judicial foreclosure process on the principal dwelling of the obligor securing an extension of credit, the disclosure of the finance charge and other disclosures affected by any finance charge shall be treated as being accurate for purposes of this section if the amount disclosed as the finance charge does not vary from the actual finance charge by more than $35 or is greater than the amount required to be disclosed under this title.

But I don't understand how they are selling unregistered securities if they are bundled and then securities are sold I just started reading a leading book on securitization of credit and they never said one time that they sell promissory notes but what they do sell is securities...but what my gut is telling me is that there is fraud somewhere in between the transaction It may be from them transferring to the mortgage pool 15 USC 78(c)(10)
but shall not include currency or any note, draft, bill of exchange, or banker's acceptance which
has a maturity at the time of issuance of not exceeding nine months. So I guess by them selling the note to the mortgage pool it may be considered an un registered security since the note exceeds the maturity date of nine months. I guess then you would have to look at FR 2046 balance sheet, 1099-OID report, S-3/A registration statement, 424-B5 prospectus and RC-S & RC-B Call Schedules to see what the mortgage pool paid for the note....And I also believe on the mortage pools side that there is fraud which would make the note un enforceble from the mortage pools prospective.. I have to dig this out...through their books..

UCC 3-203


(b) Transfer of an instrument, whether or not the transfer is a negotiation, vests in the transferee any right of the transferor to enforce the instrument, including any right as a holder in due course, but the transferee cannot acquire rights of a holder in due course by a transfer, directly or indirectly, from a holder in due course if the transferee engaged in fraud or illegality affecting the instrument.

But anyway I good info...
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