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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Rolling in Dough, Still Kicking Out Families

Goldman Sachs Subsidiary Among 'Loan Servicers' Collecting Criticism

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There's no place like home for the holidays. But this year, Phil and Barb Kubes and their three children will have to settle for memories of Christmas past.

Photo: Litton Leaves Family Out in the Cold: Goldman Sachs Subsidiary Among ?Loan Servicers? Collecting Criticism
A foreclosed home is seen in Denver in this April 2009 file photo. Last month, Phil and Barb Kubes... Expand
(UPI Photo/Landov)

Last month, the Omaha, Neb., family was forced out of their home of 12 years after falling drastically behind on mortgage payments. Having failed to reach a workable solution with Litton Loan Servicing, the Houston-based company that collects their mortgage debt, the Kubes were foreclosed upon and told to vacate.

They ended up renting a house across town.

"It's comfortable," Barb Kubes said. "But it's not home."

Litton is by no stretch the largest loan servicing company -- essentially the mortgage industry's version of a collection agency -- but it is among the ones coming under the most heavy fire in the wake of a housing crisis that continues to roil the country.

Litton, unfairly or not, has drawn the wrath of legions of homeowners, homeowner advocacy groups, lawmakers, labor unions and class action attorneys alike. One glaring reason Litton has attracted so much of the scorn directed at loan servicing in general: It is owned by Goldman Sachs, proverbial poster child for Wall Street's excess and its percieved indifference to the plight of average Americans.


"Upset," Barb Kubes said, choking back emotion, when she was asked how she felt when she found out Litton was owned by massively profitable Goldman Sachs.

It didn't help that her hometown hero, Warren Buffett, the so-called Oracle of Omaha, invested $5 billion in Goldman shares during the height of the crisis last year.

"I'm surprised Warren Buffett would have anything to do with them," she said.

With the exception of maybe AIG, no firm has come to symbolize Main Street's disgust with Wall Street practices more than Goldman. In a move that caused a global backlash, Goldman has said it expects to set aside more than $20 billion for bonuses and other forms of employee compensation and benefits at the end of the year.

 Critics of Goldman's compensation practices say the firm has no business handing out billions to bankers and traders after having been the beneficiary of numerous forms of federal assistance, including TARP money (that Goldman has since paid back) as well as billions in FDIC-guaranteed loans and another $13 billion in taxpayer money given to AIG that was ultimately paid to Goldman.

Though it will derive only a tiny fraction of the billions it expects to earn this year from revenues produced by Litton, Goldman nevertheless finds itself, albeit indirectly, connected to a highly controversial issue at the crux of the housing crisis: Widespread failure by banks to allow homeowners to modify their loans.

A recent study by the Federal Reserve Bank of Boston showed banks have little incentive to modify loans to help homeowners avoid foreclosure because of one simple reason that at this time of year perhaps only Ebenezer Scrooge could appreciate: Loan modification is not profitable for lenders.

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Where's the outrage????  It's there and continuing to build.

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The upper level crooks at Goldman, AIG, Litton, Bank of America etc. and the politicians that supported the bailout and Tarp should all be convicted of treason and hung. That would be nice Christmas present for the victims and restore some of the honor and reputation of our country that has been so badly damaged by sponsoring domestic terrorism on a historically unprecedented scale.

In fact the attack on our country by the bailout did so much damage it hurt other countries dependent on our economy and trade and set the stage for perpetual war so really the crooks that supported the bailout should be considered international terrorists to prevent them safe harbor in other countries.

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4 Justice Now

You are absolutely right! I couldn't agree more. In fact, I'd be more than happy to provide the rope.


The upper level crooks at Goldman, AIG, Litton, Bank of America etc. and the politicians that supported the bailout and Tarp should all be convicted of treason and hung.


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I second that nice one greg in fact one of the founding fathers instructed "The tree of liberty must be refreshed from time to time with the blood of patriots and tyrants. It is it’s natural manure" THOMAS JEFFERSON, letter to William Stephens Smith, November 13, 1787.—The Papers of Thomas Jefferson, ed. Julian P. Boyd, vol. 12, p. 356 (1955).

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