Author Archives: D Boggs

Is the New York Fed’s massive loan program to Wall Street even legal?

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It’s long past the time for the U.S. Congress to ask the overarching question: is the New York Fed’s massive loan program to Wall Street firms even legal? And was it legal from 2007 to 2010 during the financial collapse on Wall Street?

The Federal Reserve system was created in 1913 with a Discount Window that was to be the lender-of-last resort to deposit-taking banks to prevent panics and bank runs from bringing down the U.S. banking system. To this day, only deposit-taking institutions are allowed to borrow at the Fed’s Discount Window .

The core function of deposit-taking banks throughout U.S. history has been to use those deposits to lend to worthy businesses that can help grow the U.S. economy, keep America competitive, and bring good paying jobs to the American people.

Never in its history has the Federal Reserve, the U.S. central bank, been authorized to function as the lender of last resort to Wall Street stock trading firms. Those firms are supposed to be part of a free and efficient market system where those that take on undue risks trading stocks, bonds and derivatives are allowed to fail if their gambles go south. But during the financial crisis of 2007 and 2008, the Federal Reserve set up loan programs specifically designed to bail out the bad bets of securities firms on Wall Street. The Fed’s current loan program appears to be doing the exact same thing.

Below is a list of the 24 Wall Street firms (known as primary dealers) that are exclusively eligible to receive the hundreds of billions of dollars in overnight and longer term loans from the Fed via its regional bank known as the Federal Reserve Bank of New York (New York Fed). This loan program began abruptly on September 17 of this year.

Federal Reserve’s 24 Primary Dealers as of October 7, 2019 (Source — Federal Reserve Bank of New York)

Federal Reserve’s 24 Primary Dealers (Source: Federal Reserve Bank of New York)
Of the 24 firms, only one has the word “bank” in its name. That’s the U.S. branch of the Bank of Nova Scotia. Eleven of the firms have the word “Securities” in their name and are listed at Wall Street’s self-regulator, FINRA, as broker dealers – meaning their primary activity is selling securities (stocks, bonds, etc.) for their customers or their own account. The rest are investment banks that underwrite security offerings and have trading desks – again, not deposit taking banks. (Some, of course, are units of so-called universal banks, which thanks to the repeal of the Glass-Steagall Act in 1999, are allowed to own federally-insured commercial banks as well as all the high-risk stock trading businesses.)

Among the list of 24 firms are Citigroup Global Markets and Morgan Stanley. Both of these are investment banks and ranked number 1 and number 2 on the New York Fed’s insidious bailout program during the financial crisis known as the Primary Dealer Credit Facility. (See chart below.) Citigroup Global Markets borrowed a mind-numbing $2.02 trillion in revolving loans from that program while Morgan Stanley borrowed $1.9 trillion of the total $8.95 trillion that was funneled to Wall Street securities firms. The PDCF loan facility lasted from March 16, 2008 to February 1, 2010 – a very long time for what the Fed characterized as an “emergency” action.

According to the Government Accountability Office’s audit of the Federal Reserve’s lending programs during the financial crisis, the PDCF worked like this:

“On March 16, 2008, the Federal Reserve Board announced the creation of PDCF to provide overnight collateralized cash loans to the primary dealers. FRBNY [Federal Reserve Bank of New York] quickly implemented PDCF by leveraging its existing legal and operational infrastructure for its existing repurchase agreement relationships with the primary dealers… Eligible PDCF collateral initially included collateral eligible for open-market operations as well as investment-grade corporate securities, municipal securities, and asset-backed securities, including mortgage-backed securities.”

But six months after PDCF began, Wall Street had run out of good collateral but still needed trillions of dollars in revolving loans. So the New York Fed started accepting dodgy collateral. The GAO report tells us this:

“On September 14, 2008, shortly before Lehman Brothers announced it would file for bankruptcy, the Federal Reserve Board announced changes to TSLF and PDCF to provide expanded liquidity support to primary dealers. Specifically, the Federal Reserve Board announced that TSLF-eligible collateral would be expanded to include all investment-grade debt securities and PDCF-eligible collateral would be expanded to include all securities eligible to be pledged in the tri-party repurchase agreements system, including noninvestment grade securities and equities.”

In other words, at a time when the stock market was in a state of freefall, the New York Fed was accepting “equities” (stocks) as collateral and “noninvestment grade securities,” a polite term for junk bonds: All being done to bail out Wall Street’s investment banks and stock-trading broker dealers – a job which has never been part of its mission.

One has to wonder just how long it will be before the New York Fed, openly or secretly again, starts to accept dodgy collateral from Wall Street for its loans.

It’s not a comforting thought that just one year ago we were reporting on the voices advocating for the Federal Reserve to be allowed to buy up stocks during the next Wall Street crisis of its own making.  (See The Chorus Grows for the Fed to Buy Up Stocks in the Next Wall Street Crisis)  

 

 

 

 

GAO Data on Emergency Lending Programs During Financial Crisis
Note: The GAO data excludes some Fed programs. For the full tally of $29 trillion, see the report from the Levy Economics Institute.

Originally published by wallstreetonparade.com ~ By Pam Martens and Russ Martens: October 11, 2019

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I welcome those reading my blog. I appreciate all of the emails I have been receiving. I also appreciate those who have registered and subscribe to this blog. If you have come from Facebook please comment on this site, rather than any Facebook post of this page due to the fact that there are many readers who are not part of Facebook forums, or even Facebook itself. I encourage all readers to put their comments on this site so that all of the information will be accessible to all readers from all parts of the internet. I urge you to join this site and receive the RSS feed, or bookmarking us, sharing us with your friends on Facebook and Twitter. If you know of anyone who might benefit from this information I urge you to pass on this website address! Share and let’s make some change together!

Thank you for stopping by.

©2014-2019 Doug Boggs All Rights Reserved

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The institutional manufacturing of the foreclosure process

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October 21, 2019. By Douglas Boggs

The institutional manufacturing of the foreclosure process begins with the servicer advising the borrower to stop payments to make sure it puts them in a better position for a modification. So, the servicer advises a homeowner to fall behind on their payments in order to qualify, if they wish to obtain any government sponsored relief. The distressed homeowner does as advised and falls behind in order to qualify for the government sponsored mortgage relief program and is subsequently placed in default. This is textbook and this common process has happened to millions of people across the United States.

The Servicer immediately cashes a credit default swap for some percentage of the mortgage balance and has some split with the investor. Now, make a note that the investor’s are those who invest in mortgage backed securities(MBS) and hedge funds that untilize MBS’s as investment vehicles. They are the owners of the note once the note is securitized. Also note, that if they are the owners of the note, this means that the chances that the foreclosing party holds a near 90% chance that they hold absolutely NO right to foreclose. But, this is a differentt story for later and some of which I have previously posted herein this blog. Ok, moving on now, then the servicer would send 10 or 15 sets of mortgage modification applications to the homeowner and collect payments of $300 each under their HAMP servicing agreement with the fed.

Following this, they offer a trial modification to the homeowner and promise that it will convert to a permanent modification if the homeowner makes all of their payments on time. The bank loses the paperwork 3, or 4, or 10 times, or more and charges the fed each time they process a new application.

Rarely, in some studies as low as 1%, the homeowner is approved for the temporary modification and starts paying the narrowly reduced payments while the servicer dual tracks the homeowner for foreclosure and hires LPS, the parent company to LSI Title to file some fraudulent assignments in the name of the deceased bank the servicer bought the servicing rights from (Countrywide, World Savings, Indymac, whoever) .

The servicer shoplifts the temporary payments while the homeowner thinks they are going to the mortgage-backed-security(MBS) towards P&I thus putting the homeowner further behind, allthewhile fucking their own MBS investor. The servicer gets paid a fee by the fed for servicing the temporary mod under their HAMP servicing agreement. The servicer denies the modification and forecloses on the property and collects a fee from the investor for servicing the foreclosure and collects an 80% FDIC loss share payment from the FDIC which it splits with the investor.

The house is sold, usually to a company that buys foreclosure properties in bulk for less than their retail value which is done to manipulate the real estate market, and the investor recovers the REO value less the banks REO sale fee.  The company that buys the foreclosed property works with the servicers in order to manipulate the market as a whole. In my case, I found a corporate maze of over a dozen corporations tied to two individuals that use this process to hide assets. The judge was privy to this and quite friendly to the party in question. Perhaps on the take, or perhaps they play golf. However, well versed with each other.

The Non Judicial foreclosure process is a fast food style of law where the Unlawful Detainers get stream lined and rubber stamped by the Judges because the Judges are making a profit on each property in the process as a percentage to look away.

The only reason any of this could take place is due to the fact that the Legislation changed the Servicing powers and the ability to transfer the trusteeship of the Deed of Trust. The Registrars and everyone else mistook this legislation to mean that the Trustee can be reassigned by the Beneficiary or Servicer and possess the rights of the primary Trustee named on the Deed of Trust that was originally signed by all of the parties.

The illegal government rubber-stamped dismantling of the middle class. How can you ever stop a ruling class from doing something that is this lucrative???

So, to do a short recap. There are branches of the Wall Street financial institutions that are manipulating the mortgage back security markets, collateralized debt obligation markets, paying off the Security rating agencies. The government is complicit in the manipulation of the real estate markets, the modification programs, the rating agencies, the Security and Exchange Commission, and the FDIC. The Wall Street financial institution then work the other side of the con with the large foreclosure firms that are in bed with the judicial system. The back door payments to the judges, or as the padding of their retirement pension funds through the financial institutions, the justice system looks the other way. All of this happens when a borrower signs for a mortgage loan. Despite the fact that the financial institution is not even actually lending any money to the borrower, but simply manipulating the monetary process in its spreadsheet.

Little does the homeowner know that their signature also allows the trustee, who is partners with the financial institutions, to be able to steal their home any time, any day, no matter what. You think your home can’t be taken even if you are current on your mortgage payments, you a gravely mistaken. If you think your home can’t be taken from you even if you paid CASH, you are gravely mistaken. This is done through the systemic unregulated fraud that the financial institutions and the government are fully cognizent of and are complicit in order to work at such a massive systemic level. The legislation allowed this illegality to transpire, despite the settled (1978) CA Supreme Court decision that the trustee is to be independent of the transaction between the borrower and the lender. So, the government complicity is paramount from legislative to justice.

The fallout is not simply the defrauded homeowner. The economic fallout are the hundreds of millions of dollars that the County Registrars across the nation are defrauded from through the creation of MERS. The bailouts for the financial institutions will continue, plus they write off the legal penalties for the taxpayer cover. The tax payer feels a bit better when the banks are penalized for millions, only to find it hidden in the “make America great again” tax overhaul for the wealthy. Steve Mnuchin was previously a foreclosure king if you didn’t recall.

Nothing has changed. It all has become more streamlined from Wall Street, through the White House, onto the floor of the house, and “trickling down” into the Main Street U.S.A.’s across the country. The writing is on the walls of justice that the world is still turning the way the system was designed to do, as the Trump administration and the Supreme Court is looking into the constitutionality of the Consumer Finance Protection Bureau.

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I welcome those reading my blog. I appreciate all of the emails I have been receiving. I also appreciate those who have registered and subscribe to this blog. If you have come from Facebook please comment on this site, rather than any Facebook post of this page due to the fact that there are many readers who are not part of Facebook forums, or even Facebook itself. I encourage all readers to put their comments on this site so that all of the information will be accessible to all readers from all parts of the internet. I urge you to join this site and receive the RSS feed, or bookmarking us, sharing us with your friends on Facebook and Twitter. If you know of anyone who might benefit from this information I urge you to pass on this website address! Share and let’s make some change together!

Thank you for stopping by.

©2014-2020 Doug Boggs All Rights Reserved

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Supreme Court will hear a challenge to the Consumer Financial Protection Bureau

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It seems that the Supreme Court will hear a challenge to the constitutionality of the Consumer Financial Protection Bureau. The organization has been stripped down as of lately under the current Administration to a point where it is nearly just a namesake of hope to those who ever felt it held any solace or reparations to any homeowner.

“Under President Donald Trump, the CFPB has already dramatically pared back its role as a financial watchdog. A report published by the Consumer Federation of America earlier this year found that the agency had dropped enforcement activity 80% compared with its peak in 2015. Average monetary relief, the report found, was down 96%.”– consumerfed.org

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KEY POINTS

  • The Supreme Court announces that it will hear a case challenging the constitutionality of the Consumer Financial Protection Bureau, a regulatory agency established in the wake of the 2008 financial crisis.
  • A decision in the case is likely by the end of June, meaning that the fate of the regulator will be announced in the middle of the 2020 presidential campaign.
  • That could be particularly significant for Sen. Elizabeth Warren, a consumer advocate whose role in creating the agency has formed a central pillar of her presidential bid.
GP: Consumer Financial Protection Bureau Headquarters 190304

Signage is displayed inside the Consumer Financial Protection Bureau (CFPB) headquarters in Washington, D.C., U.S., on Monday, March 4, 2019.Andrew Harrer | Bloomberg | Getty Images

The Supreme Court on Friday announced that it will hear a case challenging the constitutionality of the Consumer Financial Protection Bureau, a regulatory agency established in the wake of the 2008 financial crisis.

The case was brought by Seila Law, a California-based law firm, which alleges that the structure of the agency grants too much power to its director, in violation of the Constitution’s separation of powers.

Unlike the heads of many other federal agencies, the director of the CFPB may only be removed by the president “for inefficiency, neglect of duty, or malfeasance in office.” Given the CFPB’s broad law enforcement powers, that independence is unconstitutional, Seila Law has argued in court papers.

In an order posted Friday, the justices asked both sides to address whether the bureau can remain even if its structure is found to be unconstitutional.

A decision in the case is likely by the end of June, meaning that the fate of the regulator will be announced in the middle of the 2020 presidential campaign. That could be particularly significant for Sen. Elizabeth Warren, a consumer advocate whose role in creating the agency has formed a central pillar of her presidential bid.

It is possible that a ruling against the CFPB would maintain the agency but only on the condition that its director, who serves a five-year term, can be removed at the pleasure of the president. If Trump loses his reelection bid in 2020, that would mean that a Democrat will be able to replace Trump’s current appointee, CFPB director Kathy Kraninger, when they take office.

Read more: The head of the CFPB now believes that the financial regulator is unconstitutionally structured

To date, the CFPB has survived multiple court challenges.

The federal appeals court in Washington upheld the agency last year on the basis that the Supreme Court, more than 80 years ago, signed off on the Federal Trade Commission, a similarly structured regulator, in the 1935 case Humphrey’s Executor. In May, the CFPB defeated Seila Law before a panel of the 9th U.S. Circuit Court of Appeals.

“Seila Law contends that an agency with the CFPB’s broad law-enforcement powers may not be headed by a single Director removable by the President only for cause. That argument is not without force,” Circuit Judge Paul Watford wrote for the court.

But, he said, given Humphrey’s Executor and a later case which reaffirmed the ruling, the CFPB is constitutional.

“The Supreme Court is of course free to revisit those precedents, but we are not,” he wrote.

Under President Donald Trump, the CFPB has already dramatically pared back its role as a financial watchdog. A report published by the Consumer Federation of America earlier this year found that the agency had dropped enforcement activity 80% compared with its peak in 2015. Average monetary relief, the report found, was down 96%.

Given the makeup of the Supreme Court, it’s likely that the agency’s structure could be struck down.

Justice Brett Kavanaugh, whose confirmation last year delivered conservatives a reliable majority, made clear in a dissent from the Washington appeals court decision upholding the bureau that he believes the structure of the CFPB is impermissible.

“Indeed, other than the President, the Director of the CFPB is the single most powerful official in the entire U.S. Government, at least when measured in terms of unilateral power,” Kavanaugh wrote at the time. “That is not an overstatement.”

Notably, Kavanaugh did write in that dissent that he believed the director’s independence could be limited while leaving the rest of the bureau intact, “so that the Director of the CFPB is supervised, directed, and removable at will by the President.”

The case is Seila Law v. Consumer Financial Protection Bureau, No. 19-7.

ORIGINALLY PUBLISHED CNBC – FRI, OCT 18 20192:58 PM EDT; UPDATED FRI, OCT 18 2019 3:34 PM EDT Tucker Higgins@IN/TUCKER-HIGGINS-5B162295/@TUCKERHIGGINS

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I welcome those reading my blog. I appreciate all of the emails I have been receiving. I also appreciate those who have registered and subscribe to this blog. If you have come from Facebook please comment on this site, rather than any Facebook post of this page due to the fact that there are many readers who are not part of Facebook forums, or even Facebook itself. I encourage all readers to put their comments on this site so that all of the information will be accessible to all readers from all parts of the internet. I urge you to join this site and receive the RSS feed, or bookmarking us, sharing us with your friends on Facebook and Twitter. If you know of anyone who might benefit from this information I urge you to pass on this website address! Share and let’s make some change together!

Thank you for stopping by.

©2014-2019 Doug Boggs All Rights Reserved

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Judge Dismisses CFPB Case Against OCWEN

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A case levied against Ocwen Financial Corporation (NYSE: OCN) by the Consumer Financial Protection Bureau (CFPB) in 2017 has been dismissed by a federal judge in Florida, though the Bureau has the option to refile the case if it so chooses, according to a story in National Mortgage News.

Originally filed by the Bureau in early 2017, the lawsuit alleges a host of violations on the part of Ocwen, including illegally foreclosing on 1,000 borrowers, mishandling escrow accounts, enrolling consumers in add-on programs without their consent, and knowingly populating its mortgage-tracking software with incorrect or incomplete information.

The basis for the dismissal by Judge Kenneth Marra rested in a concept known as a “shotgun pleading,” which is defined as a legal complaint which offers an excessive number of facts while lacking any semblance of clear organization, and then asserts those disorganized and abundant facts as the basis for a cause of legal action. In answering the complaint against the company, Ocwen offered that it was an example of a shotgun pleading in seeking the case’s dismissal.

Marra agreed with Ocwen, citing legal precedent regarding shotgun pleadings from the Eleventh Circuit Court of Appeals in his reasoning for the dismissal, a court which covers federal jurisdictions in Alabama, Florida and Georgia. However, the case was dismissed “without prejudice,” which will allow the CFPB to refile it should they choose to continue pursuing legal remedies related to Ocwen’s alleged violations.

Ocwen publicly praised Judge Marra’s decision.

“We are pleased that the district court has decided to dismiss the CFPB’s complaint without prejudice,” Ocwen said in a press release responding to the dismissal. “Ocwen will continue to vigorously defend itself should the CFPB refile and continue to pursue its claims. We are committed to our mission of creating positive outcomes for homeowners and communities, and we believe that Ocwen’s servicing practices have and continue to result in substantial benefits to consumers.”


Ocwen has been facing a number of financial difficulties in recent years, though a continuous bright spot for it in terms of business performance has been Liberty Home Equity Solutions, its reverse mortgage lending subsidiary. Most recently, Liberty recorded strong numbers in its reverse mortgage business in Q2 2019 in spite of Ocwen’s larger aim to return to overall profitability, according to financial disclosures released last month along with an accompanying earnings call.

Liberty also recently launched its own proprietary reverse mortgage offering, EquityIQ, which was touted by Ocwen’s leadership as part of Ocwen’s larger initiative to grow its lending volume and achieve a more balanced revenue mix, according to Ocwen CFO June Campbell in August.

Read the original National Mortgage News story on the CFPB case’s dismissal.

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I welcome those reading my blog. I appreciate all of the emails I have been receiving. I also appreciate those who have registered and subscribe to this blog. If you have come from Facebook please comment on this site, rather than any Facebook post of this page due to the fact that there are many readers who are not part of Facebook forums, or even Facebook itself. I encourage all readers to put their comments on this site so that all of the information will be accessible to all readers from all parts of the internet. I urge you to join this site and receive the RSS feed, or bookmarking us, sharing us with your friends on Facebook and Twitter. If you know of anyone who might benefit from this information I urge you to pass on this website address! Share and let’s make some change together!

Thank you for stopping by.

©2014-2019 Doug Boggs All Rights Reserved

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Wow!!! What a day…..

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From the desk of Ken Dost – Sept. 25, 2019

Wow !!! What a day….. 11 years 3 months and 2 days total since the nightmare began. By shear determination and grace of God, managed to stop more nonjudicial auctions than I can count, arrested and put on trial for chasing after an asshole taking pictures of my house charged with reckless driving, and could have went to jail for 6 months I think it was, but found innocent; fought a 3.5 year judicial action by HSBC, through 3 judges, until HSBC got their summary judgment on May 28, 2015. Made it through 3 auctions attempts.  Today though, September 25, 2019, full satisfaction of judgment, that will be almost 700K coming back… and that is nothing compared to all else I will have secured … accounts and lock boxes all over the world … but that is not the important point of this post.. 

The important point of this post is say yay!! We have a path, a Bona fide path to long standing and permanent relief.. it is not entirely done yet, as there are a couple of items yet to do to make it completely bullet, bomb, and Commonwealth-proof. 

It is a good day, not just me and mine, but for who struggle against a system that does not hear, see, or recognize the human pillaging that is taking place around the world. It is a good day cause the route that this despotism travels is now discovered and disseminated.. 

We, as a society, have a lot of work to do to wash away all the deceptions we have made to believe as fact; and to reeducate ourselves to the actual facts.  We are so out of touch with actual reality, that is to say, how the world actually functions in the present times, not how it did in 1933, or even how it was on June 22, 1998. The following day, June 23, 1998, the world as we understood changed forever, with the state street v signature financial group ruling. It was not just this ruling, it is the Legislative Acts between 1998-2002, the enacting of UCC rev 9 in 2001, that same year, by the OCC’s sweeping deregulation and preemption policies. It just so happens that these two major events get dusted by the implosion of the twin towers giving birth to the global war on terror .. 

I have my own ideas as to why, having to do with the expiration of the 1933 bankruptcy and trading with the enemies act, which people mistakenly believe still applies. Neither does though, because of what is mentioned above. You need to understand that the entire economy as you understood it .. mortgage loans, ownership, ordinary courier practices, the decades old economic paradigm, was eviscerated between 1998-2002, just like the twin towers … here one minute and gone the next.., Between 2002-2005 an entirely new economic system was being engineered and laid in place. Our attention was elsewhere, while the business of banking and foreign agent patent law firms were busy engineering an economic coup d’atet, that OCC gave protection to, by preemption.

From the desk of this blog host: If you haven’t heard of Ken or have been following him online during any of his long legal story, it is certainly something to be impressed with. What he has uncovered is an amazing feat to which I am eager to learn more and master over time as he has. I look forward to hearing more about his journey and knowledge of his views of the corruption of the systems that we are all in some way are beholden to. It is through efforts of people like him that for those who live on this blue ball, suspended in a sun beam, that we call home can hold hope that we will make this world a better place.

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I welcome those reading my blog. I appreciate all of the emails I have been receiving. I also appreciate those who have registered and subscribe to this blog. If you have come from Facebook please comment on this site, rather than any Facebook post of this page due to the fact that there are many readers who are not part of Facebook forums, or even Facebook itself. I encourage all readers to put their comments on this site so that all of the information will be accessible to all readers from all parts of the internet. I urge you to join this site and receive the RSS feed, or bookmarking us, sharing us with your friends on Facebook and Twitter. If you know of anyone who might benefit from this information I urge you to pass on this website address! Share and let’s make some change together!

Thank you for stopping by.

©2014-2019 Doug Boggs All Rights Reserved

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