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False Affifavits “Replacement”? Ohio AG Says “Not So Fast” OR Have You Heard of the Law Mr Banker? Answer: No.

30 Oct

Perfection is.

Ohio Attorney General Guts Bank “Just Submit New Affidavits” Plan

from naked capitalism by Yves Smith

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We have pointed out several times that banks were being awfully optimistic in assuming that they could simply replace improper “robo signed” affidavits with ones that were done correctly. The submission of a phony affidavit is a fraud on the court. The lawyers involved are subject to sanctions and judges could reject the filing, forcing banks to restart foreclosures from scratch.

The Ohio attorney general is using the leverage this situation presents to turn the table on banks. From the Wall Street Journal:

In two letters released Friday, Attorney General Richard Cordray criticized a number of banks and loan-servicing companies, including Wells Fargo & Co.; Ally Financial Inc.’s GMAC Mortgage; Bank of America Corp.; and J.P. Morgan Chase & Co. Mr. Cordray said the banks are trying to paper over fraud committed in foreclosures with temporary fixes that don’t address underlying problems in the banks’ practices.

“It is not acceptable for a party who believes they submitted false court documents to merely replace those documents. Wells Fargo and any other banks are not simply allowed a ‘do-over,’” he wrote in the letter to Wells. The other letter was sent to Ohio judges, who were asked to notify Mr. Cordray when banks file substitute affidavits….

“The banks are committing fraud on the court, essentially perjury, and then saying ‘Whoops! You caught me! Here’s some different evidence and use that instead,’ ” Mr. Cordray said in an interview Friday. “I know a lot of judges are not going to take kindly to that.”

Amusingly, Wells Fargo, the most self-righteous of the big banks (it went from claiming its practices were fine and falsely claiming it had no robo signers to suddenly deciding it had to resubmit 55,000 affidavits), does not get it:

A Wells Fargo spokeswoman said Friday the company intends to cooperate with Mr. Cordray’s inquiries and doesn’t “believe that any of these instances led to foreclosures which should not have otherwise occurred.” She added that Wells Fargo has “chosen to submit supplemental affidavits out of an abundance of caution.”

It’s going to be even more fun if more state AGs decide to put banks through the unfamiliar process of respecting the law.

 

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