Tag Archives: SB1638

Is Fraud a Silent Sword?

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By Doug Boggs

Is Fraud a silent sword? The Dausi was a poem of the history of the Soninke people and the rise and fall of their eternal city. African legend says, the city of Wagadu, was protected by a great serpent named Bida. Every year Bida rained down gold on the city of Wagadu in exchange he required sacrifice of a young woman chosen by lottery. This agreement was how the kings of Ghana attained their wealth and power. This custom continued for many generations until one day fate had chosen the beautiful Sai Tu Bara to become a wife and sacrifice to Bida. Her fiancé Mamadi, a warrior whose praise name was Sefe Dekote (the ‘silent sword’) due to his taciturn nature and relentlessness towards his goals discovered that Sia was chosen to be sacrificed. Determined to save her life, Mamadi killed the serpent thus making him an outcast. Soon after the death of the serpent Bida, the city of Wagadu was destroyed and the Soninke people scattered. 

Lawyers don’t ask the right questions in order to get the answers that could serve the people most in need. I have found that lawyers ask questions to what they already know the answers to. This practice might help them formulate a response to a specific line of questioning in order to fine tune their making their point. However, this kind of practice will never shed light on any new ideas or evidence.

I have recently come across an article online written by a lawyer, named Abe Salen, of The Wolf Firm. It was posted on February 1, 2018, on a financial services website USFN. The Wolf Firm is a 30 year old legal corporation, based out of Irvine, CA, that claims to do business in California, Washington, Oregon and Idaho. Their website states that they are attorneys to the financial services industry. The byline claims that The Wolf Firm is a member of an organization named, USFN (American Mortgage Banking Attorney’s). USFN, is an organization filled with attorneys from the mortgage banking business. They were recently recruiting new members at the 2019 MBA Servicing Conference. It would be fair to say that they are not attorneys that I would hire or for any homeowner needing assistance with their home foreclosure.

The article begins with “Fraud has consistently been a silent sword used by borrowers and their agents to stall the foreclosure process and keep the non-paying borrower in the property.” This is far from the truth. Fraud is not a silent sword used to stall a foreclosure. Fraud is a cause of action against a company who is illegally foreclosing on a homeowner. Their quip of “…keep the non-paying borrower in the property” is a bit presumptuous. I say that because Wells Fargo Bank began their foreclosure proceedings on me while I was current on my mortgage. Yes, you heard that right. I am also familiar with countless people who have been foreclosed on throughout the country that paid cash for their home and never had a mortgage to which they were “non paying” to. So, that begs the question of just what the word fraud means in a foreclosure procedure.

The next paragraph of the article continues with “Over the last 18 months, a grand scheme has been uncovered by both federal and state law enforcement in which the borrower is generally a non-participant. Rather, the perpetrating entity conducts a public or semi-private search for properties with loans in foreclosure — often properties that have been in foreclosure for some time (several months to multiple years), but with no record of a sale having occurred. The scheme has reached significant levels in California.” This makes the claim that the borrower is generally a non-participant. This is very true to a homeowner with a Deed of Trust attached to their mortgage. In my legal case against Wells Fargo, I showed the court, just how much a homeowner is as a non-participant borrower. I showed the court how the state legislature made a deed of trust in the state of CA void through their passing of SB1638 in 1996, which became law in January 1, 1998. Due to my exposure of that silent sword the courts then silenced my court files and removed them from public view. The fact that a Deed of Trust is void exemplifies just how much a borrower is a non-participant.

“The process is this: once the property is identified, the perpetrating entity begins its fraudulent scheme by recording a bogus assignment. That same day, this entity substitutes in a subsidiary as the foreclosing trustee. Thereafter the “new” trustee immediately (often within 1-3 days) records a Trustee’s Deed Upon Sale, transferring the property to the fraudulent beneficiary. With a recorded transfer in hand, the perpetrating entity sends out private invitations to known REO investors seeking bids for the purchase (at pennies on the dollar) of the subject property. This scheme is “grand” because it encompasses several hundred properties throughout California, with many more suspected — including properties throughout the West Coast and neighboring states, and eastward.” Let’s paraphrase this a little bit: Once the property is identified, means that there is a computer algorithm that spits out information to a law group, such as The Wolf Firm. This information will show properties that are in some part of the foreclosure process. So, as we have already learned, this means that the home is in some part of the foreclosure process, but it does NOT specifically mean that the homeowner has not paid their mortgage. The article goes on to state that a perpetrating entity begins a fraudulent scheme by recording a bogus assignment. Through that bogus assignment, this perpetrating entity substitutes themselves as a substituted trustee in a deed of trust. This action makes this perpetrating entity a fraudulent trustee. Only through the passing of SB1638 can this action occur.

Let’s look into this further. A Non-Judicial foreclosure was designed to take the process of foreclosure out of the encumbered court system. In order to do this, an independent third party, the Trustee, was added to the transaction in order to act as the independence of the court system that was now usurped. The CA Supreme Court ruled in a 1978 landmark ruling that the trustee is to be an independent party in a deed of trust. The trustee is to be held at arms length to the other parties within the transaction so as to be impartial to the needs of the transaction and the non-judicial foreclosure procedure. In a non-judicial foreclosure it is the trustee that acts as and on behalf of the court. The trustee is to make sure that the borrower, as well as the lender, all abide within the rules of the Power of Sale clause, CA Civil Code 2924, in a non-judicial foreclosure procedure. Through the independence of the trustee the courts are then bypassed and considered less encumbered by having less foreclosures on the court docket.

So, The Wolf Firm, freely admits that the system allows for a perpetrating entity to make itself become the substituted trustee. This new fraudulent substitute trustee then files fraudulent documents to the court recording a Trustee Deed Upon Sale. This fraudulent paperwork created the transferring of the property to a fraudulent beneficiary. If all of this fraudulent paperwork can be filed to the court, it is only safe to assume that other fraudulent paperwork can be filed to the court. Such as documents that the borrower has defaulted on a loan when in fact they did not. And in numerous cases there was never a loan against the property for a borrower to default from. However, these documents get filed. Due to this process, I have also seen documents to which one or more of the borrowers listed in the foreclosure procedure signed documents when they were dead and buried.

If the Trustee is independent in the transaction, how could all of this fraud be able to take place? It is their job specifically to make sure that does not happen, as they are acting as the court. That certainly shows a breakdown of the non-judicial foreclosure process. This stems from SB1638 which allowed the beneficiary to name a new trustee at will. So, if the acting trustee would not allow a bank or legal beneficiary to file fraudulent documents or perhaps slide by some of the rule of CA Civil Code 2924 in the Power of Sale clause in order to expedite a fraudulent foreclosure proceeding, that bank or legal beneficiary could substitute a new trustee into the transaction that will act on the beneficiary’s behalf. It is for this reason that the Power of Sale clause becomes moot and therefore the deed of trust becomes void. If the ruling of the legislature no longer adheres to the ruling of the CA Supreme Court and the need for an independent trustee is deemed necessary, than the entire non-judicial foreclosure system is fraudulent and all deeds of trust are fraudulent and therefore void.

“The problems are clear. With the fraudulent recordings occurring so quickly, it may be difficult for servicers and trustees to become aware of the fraudulent cloud on title until a bona fide purchaser is in the mix. Several title companies are now aware of this particular scheme. Further, at least one county has filed criminal charges against the perpetrating entities, with several more jurisdictions conducting in-depth investigations. The FBI is also investigating, and this scheme has gained the attention of numerous media outlets throughout the country.” The Wolf Firm skirts around the real issue here as they discuss the problems being clear. It isn’t that fraudulent recordings occur so quickly, it is that they are allowed to occur at all. It is easy for them to occur when there is no independent trustee in order to oversee the fraudulent documents being filed to the court. The Wolf Firm author discusses the difficulty for the servicer and trustees to become aware of the fraudulent cloud on the title. The trustee is never NOT aware, as it is the acting perpetrating entity which has now clouded the title with fraudulent papers.

“This situation provides a serious reminder that servicers/trustees must stay vigilant in their due diligence as they begin the foreclosure process, and ensure that the title searches remain current throughout the process. Updating title reports at regular intervals during the process is recommended, especially when files are placed on hold, in order to confirm that title remains unaffected — not just from borrower conduct but also from possible third-party perpetrators.” How is it that a trustee is able to remain vigilant when it was put in place by the beneficiary in order to do its bidding. The trustee is in place to make sure that no matter what, the beneficiary is able to foreclose on any home, any time, any where, despite anything. PERIOD. To state that they must stay vigilant to ensure that the title searches remain current is simply a joke. And this joke was authored by The Wolf Firm who is a law firm which acts on behalf of financial services companies. So, they know full well of the lack of independence of the trustee in a deed of trust transaction. They are fully aware and have freely admitted that a trustee does not protect the deed of trust for the borrower whatsoever.

Who are the third party perpetrators that affect the title? Law firms such as The Wolf Firm; Anglin Flewellen Rasmussen Campbell & Trytten LLP, and many other legal firms acting on behalf of financial institutions. These firms know full well that there is no independent trustee and therefore fraudulent documents filed by the trustee are on behalf of the beneficiary, to which these legal firms represent on a daily basis. There are time that these firms take on the role of the substituted trustee or as the legal team for the beneficiary. Usually the beneficiary has a subsidiary firm which is signed on as trustee at the onset of the deed of trust transaction.

The article discusses how a perpetrating entity can become a fraudulent substituted trustee. The article does not discuss how a fraudulent trustee is able to circumvent the ruling of the CA Supreme Court for the independence of the trustee in the Power of Sale clause. The fact that there is no independence of a trustee in a deed of trust transaction based on the fact that a bank or beneficiary can substituted a new trustee at will, simply means that the bank or beneficiary has power over the trustee. So, the trustee ergo works for the beneficiary. Ergo the trustee is not independent. Since the lender does not stipulate this fact to the borrower during the negotiations of the contract and the borrower is never privy to the fact that the trustee is working on the beneficiary’s behalf and has no vested interest in protecting the borrower from any wrongdoing from the beneficiary or servicer, there is no real meeting of the minds in the deed of trust transaction. In contract law, one of the single most used arguments against the validity of the contract is the fact that there was not a meeting of the minds. If there is not a meeting of the minds in a contract, there is no contract. If one party leaves out pertinent information to the contract that is crucial to the decision making of the other party in the contract it is construed as deceptive fraud.

The original article, coming from a law firm that litigates for the financial industry, it is certainly deceptive.

Is fraud a silent sword? Is Sefe Dekote the tool for homeowners to battle against Bida, the big bad banks and law firms acting fraudulently and illegally foreclosing on people throughout the United States? Sharpen your blades foreclosure warriors.

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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.

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©2014-2019 Doug Boggs All Rights Reserved

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It’s actually all quite simple, but so corrupt

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Once you see behind the proverbial curtain you will find that “it’s actually all quite simple, but so corrupt.”  Why do we call it a justice system, when the justice is gone?  Why do we call it a Trustee when it is in fact a strawman?  Why do we call it a Deed of Trust, when there is no trust involved?  Why do we call it a Non-judicial foreclosure procedure, when the courts are partisan to the fraud?  Perhaps it is called Non-judicial because you will never find true justice.

 

It all comes down to this: “The banks are incapable of proving that the Trustee is in fact independent in the Deed of Trust contract which the bank used as the instrument as means to attach the home as collateral against the mortgage.  The bank is incapable of proving that the Trustee has the power to protect the homeowner from any wrongdoing by the bank during the life of the Deed of Trust contract as described by the need for the Trustee to be recognized as an independent party to the Deed of Trust transaction.  If the banks are unable to prove of the independence of the Trustee in a Deed of Trust agreement then they are in fact committing fraud when using a Deed of Trust agreement when they do not inform the borrower of the fact that the Trustee is not independent and is incapable of looking out in the best interests of the borrower in the Deed of Trust.  If the bank uses a Deed of Trust agreement, knowing that the Trustee is not independent as described by the CA Supreme Court in 1978; Garfinkle v Superior Court of Contra Costa County, they are in fact committing fraud against the borrower at the inception of the contract which makes the contract in fact VOID.”

 

Because the bank knows that they are in control of the Trustee in a non-judicial foreclosure action they are able to in fact foreclose on anyone, anytime, anywhere whether they have a mortgage or even paid cash for their property.   Because the banks know that they own the power to replace the Trustee at any time for any reason they see fit they know that if they wish to file fraudulent paperwork to the County Recorder’s Office in a non-judicial foreclosure.  Because there is no party looking out for the interest of the property owner and the courts have handed over the justice system to the Trustee in a Non-Judicial foreclosure action.  Because the courts have entrusted the Trustee, and the CA  Supreme Court has ruled that the Trustee is to be independent in a Deed of Trust agreement they have given the judicial power of correctness to all of the documents that are filed into the court in a non-judicial foreclosure procedure.
The reason the bank or other party is able to file whatever paperwork they choose in order to foreclose on someone is due to a 1998 rule that changed the rules to the Power of Sale clause.  This rule comes from the 1996 Senate bill 1638:

SB 1638, Johnson. Deeds of trust: trustee substitution. Existing law sets forth the procedures for the substitution of trustees under a deed of trust upon real property or an estate for years therein. This bill would, as an alternative procedure, set forth the procedures for the substitution of trustees under a deed of trust upon real property or an estate for years, given to secure an obligation to pay money, by the beneficiary or beneficiaries under the trust deed who hold more than 50% of the record beneficial interest of a series of notes secured by the same real property or of undivided interests in a note secured by real property equivalent to a series transaction. The bill would also establish a process through which all of the beneficiaries under a trust deed can agree to be governed by beneficiaries holding more than 50% of the record beneficial interest of a series of notes in real property or interests in a note equivalent to a series transaction, as specified. In order to substitute trustees or agree to be governed by the majority interest holders, all parties to the transaction would be required to sign and record a document containing specified information.

This rule gave the bank to power to substitute a new trustee at the will of the bank thereby destroying any semblance of law to the Power Of Sale clause or CA Civ Code 2924 therein making any Deed of Trust agreement fraudulent on its face and therefore void.  Which makes EVERY Deed of Trust agreement since Jan 1, 1998 in fact VOID.

 

We will go over the true repercussions of this next.

 

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I welcome those reading my story. 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.

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©2014-2017 Doug Boggs All Rights Reserved

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