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Bear Stearns Execs Committed Fraud Against Investors – Now Head up Goldman and BofA Desks; Meantime Lenders Seek Court Permission to Destroy 22,100 Boxes of ORIGINAL NOTES…

02 Feb

So, the heads of Bear Stearns knew, JPMorgan knew, the Justice Department knew…

Who DID NOT know???

And now the question is whether legal action should be brought against the banks for selling fraudulent securities to insurance companies.

Emails Show Bear Stearns Was Selling Its Investors “A Sack Of Sh*t”, And Now JPMorgan May Be Forced To Pay Up

Bear Stearns mortgage execs who now head up desks at Goldman, BofA, and Ally Financial have been accused of defrauding investors of millions through shoddy mortgage securities they engineered and sold when they were at Bear Stearns, Teri Buhl at The Atlantic reports.  [emphasis added]

Oh – and while we are at it: Mortgage lenders seek legal permission to destroy 22,100 boxes of ORIGINAL NOTES.

Mortgage Lenders Seeking Court Permission To Destroy 22,100 Boxes Of Original Loan Documents

Tyler Durden's picture

Submitted by Tyler Durden on 01/24/2011 14:03 -0500

The solution to the ongoing fraudclosure fiasco is so simply and yet so brilliant (in a way that benefits the banks naturally) is so brilliant, that it has to date evaded most… but not all. The solution: just shred it all. That is what insolvent mortgage lenders Mortgage Lenders Network USA and American Home Mortgage are pushing hard to get permission from their respectively bankruptcy judges in their chapter 7 liquidation cases. Says Reuters: “Federal bankruptcy judges in Delaware are due to hold separate hearings Monday on requests by two defunct subprime mortgage lenders to destroy thousands of boxes of original loan documents. The requests, by trustees liquidating Mortgage Lenders Network USA and American Home Mortgage, come despite intense concerns that paperwork critical to foreclosures and securitized investments may be lost.” With servicer banks increasingly unable and unwilling to provide the original lender docs (since they don’t have access to them) to parties curious in seeing if there is a legal case to continue paying their mortgage, what better solution than to have the banks retort that the original document was sadly destroyed in a court-appointed shredding. In that way all the fraud canaries are killed with one stone, and the party responsible is none other than some bankruptcy judge who had given the go ahead for the wholesale destruction. And since we are not talking peanuts, in the case of MLN it comes to 18,000 boxes of records, while in the AHOM case it is just over 4,000 boxes, we wonder just how many other originators have gotten a comparable idea from the banks, and are currently busy shredding every last detail of an original mortgage note. Good luck trying to convince anyone that the bank is not in possession of a mortgage that was “purposefully” destroyed as part of a company’s liquidation proceedings. Soon to follow: the burning of all books and the banning of all websites that dare to claim this is nothing but pure, grade-A criminal destruction of evidence.

More from Reuters on this stunning development:

In the Mortgage Lenders case, the U.S. Attorney in Delaware has formally objected to the requested destruction because loss of the records “threatens to impair federal law enforcement efforts.”

And, this, dear reader… is ‘improvement!

 

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