MERS: It was developed on Wall Street by a lot of folks in that industry, and each time you have a mortgage, by law in almost every state, the person that sells that mortgage or transfers it, in other words the bank, is supposed to pay a recording fee to your local county clerk so they can keep the title clean and record it. They set this system up so they wouldn’t have to pay these fees, and we believe that eventually they have benefited to the tune of billions of dollars as a result of that, by not paying county clerks across the United States.
Way back in 2010,
Class Action RICO Suit Against MERS Alleges Tens of Thousands of New York Foreclosure Frauds Orchestrated by “Foreclosure Mill” Attorney Steven Baum & Banks
Just who owns the loans Steven Baum forcloses on is a deliberate mystery and potentially tens of thousands of New York homeowners lost their homes on a mystery.
The triple damages claim under civil (sigh) RICO is a billion dollars or so for Louisiana alone — real money — which makes Welborninteresting. Even more interesting is that RICO, as a “theory of the case,” is simple, clean, and easy to explain, unlike so many of our criminal banksters’ crooked schemes.
Why does The New York Times give front page treatment to a $25 million bribery scandal run out of Bentonville, Arkansas, and no coverage whatever to the filing of a $1 billion dollar lawsuit over an accounting control fraud scheme run largely out of Manhattan? (“Your search – Baton Rouge RICO site:www.nytimes.com – did not match any news results”; 2:20AM, April 25, 2012.) A question that answers itself, once asked.
Yet there is progress.
But it all goes back to MERS. It doesn’t so much track mortgage transfers as much as it pretends to track them. And the interested parties pretend that they have a handle on that transfer. This makes it easier to charge additional fees on a borrower, who has no idea who actually owns his or her loan. The entire thing is DELIBERATELY opaque. The less the borrower knows, the more they can get fleeced.
The registry actually served to hide the true owner of a mortgage, making it difficult for borrowers to get help in working out their loans.
The facts in Mr. Kline’s case seem to indicate another flaw with the MERS registry — that it may not even track mortgages effectively.
MERS is the electronic smokescreen that allowed banks to build their securitization Ponzi scheme without worrying about details like ownership and chain of title. According to property law attorney Neil Garfield, properties were sold to multiple investors or conveyed to empty trusts, subprime securities were endorsed as triple A, and banks earned up to 40 times what they could earn on a paying loan, using credit default swaps in which they bet the loan would go into default. As the dust settles from collapse of the scheme, homeowners are left with underwater mortgages with no legitimate owners to negotiate with. The solution now being considered is for municipalities to simply take ownership of the mortgages through eminent domain. This would allow them to clear title and start fresh, along with some other lucrative dividends.
The bottom line- based on Washington state law, MERS is not a legal beneficiary unless it actually held the promissory note secured by the deed of trust when foreclosure was initiated- which in Bain’s case, it did not.
“Obviously the court said no, MERS cannot be that entity, because it is not the note holder and it never is the note holder,” explained Huelsman.
Huelsman says the implications are huge- with the potential to affect hundreds, perhaps thousands of foreclosures initiated by MERS in this state in the past 10 years. The ruling could open the door for legal action by homeowners who’ve been foreclosed by “MERS,” instead of an actual loan holder who’s name is on the promissory note. It also has the potential to affect foreclosures currently being challenged because of MERS.
MERS remains vulnerable to a single judicial opinion affecting MERS’s arguments (and, therefore, lenders’ and servicers’ foreclosure processes) throughout any given state. However, the Essay concludes that the fact that these opinions were deemed newsworthy at all indicates that MERS’s role in mortgage foreclosure litigation is unlikely to be halted or significantly hindered on a national scale.
POK v. MORTGAGE ELECTRONIC REGISTRATION SYSTEMS, INC. | Superior Court of RI – MERS loses Motion to Dismiss in Quiet Title action
Posted on30 August 2012.