Although the coverage in the press is presented in the context of the ongoing home foreclosure crisis, the practice of “robosigning” is also prevalent in the universe of consumer credit and debt litigation. That is my experience, so that is what I’ll describe here.
After the complaint is filed a consumer will have the opportunity, through Discovery, to obtain documents for evidence at trial. A typical request in the consumer debt context is for a signed document stating that the plaintiff owns the debt. Often what we’ll get back is a facsimile of an account record and some kind of notarized statement that the “keeper of the record” is familiar with the account and attests to the accuracy of the document, which is usually a facsimile of an account statement. But the seal of the notary is from a different state than the plaintiff’s address, from someone who has never seen the record, or who is not familiar with any of the details of the account [typically what they have is an electronic printout containing a name, address,and social security number and an account balance].
In the context of foreclosure, attorneys from states with judicial foreclosure, like Florida, have been deposing these individuals and finding out that they don’t know any of the facts and circumstances of the accounts they are responsible for. They sign hundreds of documents a day and can’t possibly know the details of each file. All they are doing is providing signatures in a machine-like fashion, hence the name “ROBOSIGNING.”
Now along comes this bill, H.R.3808, and Congress, through its power to regulate interstate commerce, is going to legitimize this practice by requiring both federal and state courts to accept these signatures as legitimate.
WTF???
I am still enough of an idealist to believe the court system strives for equal justice for all. What can you say when the political power of institutional plaintiffs is expressed through this kind of legislation? An individual standing before the court must meet one standard while an institutional plaintiff can meet a far lower standard of proof. Any reasonable person would have to cite this as an example of corruption.
This is why I am having trouble working for the Democratic party this year. Obama, and to some extent Gov. Patrick, are unable to disentangle themselves from corporate interests, particularly financial interests.
Clearing bad debt from the court system is in the common interest because people can’t really participate in the economy until their credit clears. If banks, mortgage brokers and alike seek to use the courts to collect debts, houses, whatever, they ought to meet the same standard of proof as everyone else. Making the courts into agents for mortgage aggregators and debt buyers on their own terms is bad policy. It smacks of the circumstances of Shay’s rebellion.
I did at least call the White House and ask that the president not sign the bill. It hurts all the more because this exactly the kind of practice that I expected the Obama administration to stop.
On the face of it, it looks like the President won’t sign the bill. He is returning it to Congress, where it passed unanimously on voice. So expect the bill to come back to the President with the lame duck session. He’ll have no worries about mid-term elections. The bill will be law in a heartbeat after elections.
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p>Then expect all the egregious sins of the lenders to run rampant. Foreclosures on unencumbered properties, notice declarations where no notice given, false witness. The fraud happening now will only increase. Whatever state has the weakest laws and record keeping will be the source of the foreclosure documents.
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p>But our elected is paid by the banks, the large corporations. We get what they pay for. Expect many bills aimed at We The People to pass in the next few months.
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p>“A bank is a place where they lend you an umbrella in fair weather and ask for it back when it begins to rain.” –Robert Frost
My beloved and I refinanced our house this week. We’ve lived in the same house for 30 years, have just rewritten the mortgage terms from time to time.
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p>We sat with a local attorney who has done the closing the last two times we refinanced. It took over 30 minutes of signing, swapping and initialling – and we didn’t HAVE any questions or issues. There are more and more mandated forms, disclosures, titles and warranties each time – some were 10 page documents that we each had to sign twice and initial each page as well. There had to be a new inspection of the property and search of the title (guess what – we owned the house!) Neither of us read the papers, as it would take hours, but just kept initialling away. Because the only change was the interest rate.
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p>And the mortgage will be sold before we make a single payment in December.
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p>Multiply that by 12,000. And that’s just the mortgages, as you note.
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p>It is approaching the limits of possibility to have every transmitting documetn made available.
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p>And do not misunderstand – I have a friend who lost his business under RTC practices in the S&L days. The bank which held his paper went under, and RTC refused to ‘unbundle’ his property, so could either lose his building or buy 25 of them. And he had never so much as made a late payment.