Action Date: January 5, 2010
Location: West Palm Beach, FL
(Part 2 of a Series on Mortgage Fraud and Foreclosure Document Mills) IS MORTGAGE SERVICING JUST A KANSAS CITY SHUFFLE? Regarding the fabrication of documents, despite the hundreds of thousands of foreclosure cases, there are very few cases where the issue of the authenticity of documents, particularly Assignments, has been raised. Assignments are often the critical missing documents in foreclosure actions. When the Assignments have not been properly made, the lender cannot prove it owns and possesses the Note and has a right to foreclose. The issue of fabrication of Assignments may not be frequently raised because most defendants in foreclosure actions are not represented by counsel; inexperienced litigants do not suspect that Assignments may have been fabricated. Only a few lawyers have raised the issue of fabrication, but the issue is clearly arising more often. In the cases where the authenticity of an Assignment has been questioned, the challenges have come most often from judges. Because their dockets are filled with foreclosures, judges are often in the unique position to see hundreds, if not thousands, of Assignments, and compare the names, job titles, and even notary information on the Assignments. The judge who has written the most opinions that include discussion of the validity of Assignments is New York State Supreme Court Judge Arthur M. Schack of Brooklyn. In a 2008 case, Judge Schack wrote: "If these statements are true, then Mr. [Scott] Anderson lied in executing the May 1, 2007 assignment of the Valentin loan... The May 1, 2007 recorded assignment was executed by the same Mr. Anderson, wearing his hat as Vice President of MERS, at Ocwen's office, located at 1661 Worthington Road, Suite 100, West Palm Beach, Florida 33409, and sworn to before Doris Chapman, a Florida Notary Public. The Court is troubled that Mr. Anderson acted as both assignor of the instant mortgage loan, and then as the Vice President of Ocwen, assignee HSBC's servicing agent." (HSBC Bank USA, N.A. v. Candida Valentin, 2008 NY SlipOp 52167 (U), 21 Misc. 3d 1124 (A)). In another case, Judge Schack noted that the same person [Erica Johnson-Seck] signed an Affidavit as Vice President of MERS and 28 days later as an officer of DEUTSCHE BANK. Judge Schack compared the mortgage servicing industry to a con game, saying: "With the assignor MERS and assignee DEUTSCHE BANK appearing to be engaged in possible fraudulent activity by: having the same person execute the assignment and then the affidavit of facts in support of the instant application; DEUTSCHE BANK’S purchase of a non-performing loan from INDYMAC; and, the sharing of office space in Suite 400/500 in Kansas City, the Court wonders if the instant foreclosure action is a corporate “Kansas City Shuffle,” a complex confidence game. In the 2006 film, Lucky Number Slevin, Mr. Goodkat, (a hitman played by Bruce Willis), explains...'A Kansas City Shuffle is when everybody looks right, you go left. . . It’s not something people hear about. Falls on deaf ears mostly . . . No small matter. Requires a lot of planning. Involves a lot of people. People connected by the slightest of events. Like whispers in the night, in that place that never forgets, when those people do. In this foreclosure action is plaintiff DEUTSCH BANK, with its “principal place of business” in Kansas City attempting to make the Court look right while it goes left? (Deutsche Bank National Trust Company v. Ramash Maraj, 18 Misc 3d 1123 (A)). Judge Schack looks at the names of individuals signing Assignments and their job titles, and checks to see whether the same person claims to be an officer of many different banks. He checks the addresses to see how many banks and servicing companies are claiming to use the very same address. He even checks the notary information. In most of the cases, he denies the foreclosure.