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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Wall St. firms get subprime subpoenas - report

Merrill Lynch, Bear Stearns, Deutsche Bank among firms N.Y. Attorney General is scrutinizing, newspaper says.

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Regulating the subprime industry
Goldman CEO Lloyd Blankfein worries that proposals to limit subprime borrowing and markets will go too far.
 
NEW YORK (CNNMoney.com) -- Several top Wall Street firm face a New York State probe into whether their packaging and selling of debt tied to high-risk mortgages violated the law, according to a published report.

The Wall Street Journal reported Wednesday that the office of New York State Attorney General Andrew Cuomo sent subpoenas to Merrill Lynch (Charts, Fortune 500), Bear Stearns (Charts, Fortune 500) and Deutsche Bank (Charts), asking such information as how the debt was pooled into securities and the banks' relationship with credit-rating firms.

The paper said that a spokesman for Cuomo's office couldn't be reached. It said Bear Stearns and Deutsche Bank declined to comment and a Merrill spokesman would only say, "We always cooperate with regulators when asked to do so."

Many of the mortgage-backed securities that ran into trouble due to rising default and delinquency rates this summer had high debt ratings, even though they were backed by loans made to lenders without top credit ratings themselves, or who had not provided full documentation of their income.

The Journal says this latest inquiry apparently is looking at what role securities firms played in the current crisis with their underwriting standards, in particular, the relationships between mortgage companies, third-party due-diligence firms, securities firms and credit-rating firms.

Two of the firms receiving subpoenas, Bear Stearns and Merrill, have been at the center of the meltdown of the mortgage security market, although Deutsche Bank has thus far been relatively unscathed by problems in the sector. Deutsche's third-quarter earnings rose 31 percent despite $3.2 billion in writedowns due to subprime problems.

By comparison, two hedge funds run by Bear Stearns' asset-management division collapsed this past summer, helping to spark the crisis in credit markets and costing investors an estimated $1.6 billion. It also led to a 61 percent drop in earnings at Bear in the third quarter.

Merrill Lynch was one of the major investors in that fund and other subprime mortgage securities - bets which cost it nearly $8 billion and also led to the ouster of CEO Stanley O'Neal.

A month ago Cuomo announced he had issued subpoenas to government-sponsored lenders Fannie Mae (Charts) and Freddie Mac (Charts, Fortune 500) in his investigation into what he said are conflicts of interest in the mortgage industry.

He said he wanted information about loans Fannie and Freddie purchased from banks, including Washington Mutual. (Charts, Fortune 500) He charged at that time that Washington Mutual improperly pressured appraisers to provide inflated values. To top of page

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CW Subpoenaed

Countrywide Subpoenaed by Illinois - New York Times

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Got Turkey?

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I would not trust Lisa Madigan I went to visit her office and they told me lending fraud was not in their jurisdiction and they only dealt with consumer fraud. They went on to explain that they only dealt with important issues like psychics misrepresenting themselves and causing financial damage to consumers.

Her office along with other Illinois enforcement agencies made the claim that there is no way a lender can cause financial loss for the consumer because they are the ones lending money. Most of these same agencies made the claim that a lender would not misrepresent a loan because that might cause default and cause the lender a loss.

There was no mistake or misunderstanding at Lisa Madigans office I was patient kept explaining and re-explaining and showed clear evidence.

When I showed clear evidence of a foreclosure filling 30 days after a loan was disbursed that had never been agreed to and there was no closing docs for Lisa Madigans assistant looked exasperating and said I don't know what you are talking about are you trying to report an identity theft?

I hope she has turned over new leaf and is sincere.

Rod Blagojevich the Illinois governor gave the same Ameriquest office which stole my home gave them 25 million in tax breaks to expand in Illinois. He is Democrat
and Ameriquest targets minorities, seniors and women a large constituent base for Democrats in Illinois.

Lets hold these politicians feet to the fire and make sure they put their money where their mouth is.

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