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Fl. Lawyer Committed Criminal Mortgage Fraud which was Not Reported by Judge Marra

Mario German is a Florida attorney with a checkered past, based upon review by LIT. We found a clear case of closing attorney mortgage loan fraud and now he’s allegedly finchin’ escrow funds.

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LIT COMMENTARY

Now He’s Stealin’ Again.

Mario German is a Florida attorney with a checkered past, based upon review by LIT. We found a clear case of closing attorney mortgage loan fraud by Florida attorney Mario D. German which was never reported to the prosecutor or Florida Bar by S.D. Fl.  District United States Judge Kenneth A. Marra.

This type of scheme normally comes with lengthy jail terms, for example, see the case of Phillip Graham Rose, a closing attorney from Raleigh, was sentenced to 42 months and ordered to pay $1.6 million to the victims of the scheme.

A good example and explanation of this type of scheme is detailed by the Eleventh Circuit in US v Hill, a straw buyer mortgage fraud case, which we cite just a small snippet;

“The higher the property value the larger the loan, the larger the loan the higher the sales price, and the higher the sales price the larger the profit. In order to obtain loans for the highest possible property value, and reap the highest possible profit, Hill and his associates made a multitude of misrepresentations to lenders. They lied a lot. They lied about the true buyers, and they lied about the source of the down payments, and they lied about the value of the properties, and they lied about the income and employment of the buyers, and they lied about whether the buyers would occupy the properties, and they lied about whether any other properties owned by the buyers were being leased.”

U.S. v. Hill, 643 F.3d 807, 820 (11th Cir. 2011)

There is no way that Judge Marra was not aware of exactly what Mario German’s role was in this case, as outlined in his detailed order, yet he chose to blank the mortgage fraud.

Fast forward to 2020/21 and there’s two active cases, one now remanded to Florida State Court claiming theft of $202k and the other is in S.D. Fl. Federal Court, wherein German has stolen escrow funds and in the state court case he’s come up with a ‘hacker theory’ as to why those escrow funds vanished. LIT suggests the hacker and fraudster is right in view, namely the thievin’, schemin’ rogue lawyer called Mario German.

The most recent filing is a customer from Texas, who was buying used catalytic converters from suppliers in South America, only to find that his funds which were wired to German’s escrow, the $178k or so would allegedly be finched by German for his own personal use.

These are just the 3 cases we discovered and have reached court. The question remains, are these the only instances of this type of criminal behavior?

Below LIT has provided the most relevant filings for these three Mario German cases in the hopes that the FBI, DOJ, the Florida Bar and the clients attorneys have access to this information and act accordingly.

It’s highly unlikely the federal court in Florida or the judges therein will act appropriately,  as they are known to exclude and hide key evidence from litigants before the court.

The $178k Theft Case

Global Resource, Inc. v. Mario D. German Law Center, P.A. (9:21-cv-80561) District Court, S.D. Florida

ONGOING…

LIF Update: SEP 5, 2021

Judge Cannon decides to slow it down and send out an unnecessary scheduling order  on September 3, with trial date in July 2022. The default judgment(s) should have been entered and the corrupt lawyer(s) reported to the Florida Bar and Prosecutor. That, however, is not what happens in S.D. Fl. Federal Court when it involves lawyers.

LIF Update: AUG 26, 2021

On July 19, (Doc. 35) Global Resource file a response saying they are waiting for all parties to be held liable, including Mario German and his law firm before asking for default judgment.  The deadline for response is 20 July, 2021 has well and truly past and not a peep on the docket, as LIT anticipated. This is a clear case of theft of funds by all parties named by Global Resource and Cannon needs to release the cannonballs. It’s time.

LIF Update: JULY 9, 2021

Judge Cannon issues a training guide on requirements for a default judgment for two of the defendants only (Nexus and Krantz), and which excludes Mario German and his law firm. Deadline for response is 20 July, 2021 and it better be an A Grade reply.

LIF Update: JULY 4, 2021

Judge Cannon denied default judgment while a ‘show cause’ order was pending. That expired on Wednesday, June 28th, 2021.  You would have expected an order on Thursday 29th entering default judgment and reporting the rogue lawyer to task via sanctions and he should be reported to the prosecutor. Instead, nothing. That liberal delay is never applied to civil litigants, it should not apply to a thievin’ lawyer.

LIF Update: May 15, 2021

When you read Mario German’s pro se reply, it just reminds us of LIT’s article and review of the attorney fraud perpetrated in the case at the First Circuit. You can read it here and make your own assumptions, but we can see that German is being evasive and struggling to answer the complaint with general and unavailing denials.

Michael J. Krantz, Disbarred Lawyer, named Defendant along with his company Nexus.

Krantz answers for company and himself (although that’s not clearly identified on page 1 of his reply, he states as much later on). As we’ve said before, you’re fine pro se in federal court if you are defending yourself, but for NEXUS, as a registered company, you have to hire a lawyer. You cannot represent the firm pro se.

Insofar as his answer, it’s hard to swallow when you read the reason for the actions which led up to this former lawyer being disbarred in 2015 – effectively the same allegations as here, misappropriation of escrow funds in a wire transfer arrangement.

IN RE: MICHAEL J. KRANTZ NO. BD-2015-073

S.J.C. Judgment of Disbarment entered by Justice Spina on August 10, 2015.1 SUMMARY2

This matter came before the Board of Bar Overseers and the Court on the respondent’s affidavit of resignation pursuant to Supreme Judicial Court Rule 4:01, 15. In the affidavit, the respondent acknowledged that the material facts summarized below could be proved by a preponderance of the evidence.

The respondent was admitted to practice in the Commonwealth on October 22, 1986.

In December 2011, in his capacity as an attorney, the respondent agreed to assist in the transfer of 15,500 Euros, with a U.S. dollar value of approximately $19,500, from an account maintained by his client in Lebanon to an account in the United States, and to hold the funds in escrow.

Between December 2011 and about July 2012, the respondent intentionally misappropriated the escrow funds, and did not return the funds to his clients on demand and on the termination of the representation.

This conduct violated the Massachusetts Rules of Professional Conduct, including, among others, Mass. R. Prof. C. 1.15(b) and (c), 1.16(d), and 8.4(c) and (h).

In addition, the respondent engaged in the unauthorized practice of law in Florida,

and operated a law office and used letterhead and other documents falsely identifying himself as practicing in a law firm in Florida, when he was a sole practitioner and was not licensed in Florida.

This conduct violated Mass. R. Prof. C. 5.5(a), 7.1, and 7.5(a).

On October 3, 2014, bar counsel filed a petition for discipline. On July 1, 2015, the respondent filed an affidavit of resignation.

On July 13, 2015, the Board of Bar Overseers voted to recommend that the affidavit of resignation be accepted and the respondent be disbarred forthwith.

On August 10, 2015, the Supreme Judicial Court entered a judgment accepting the affidavit of resignation and disbarring the respondent from the practice of law in the Commonwealth effective immediately upon the entry of the judgment.

1 The complete Order of the Court is available by contacting the Clerk of the Supreme Judicial Court for Suffolk County.

2 Compiled by the Board of Bar Overseers based on the record filed with the Supreme Judicial Court.

ORDER FOLLOWING STATUS CONFERENCE

THIS CAUSE comes before the Court following a Status Conference Hearing held on May 28, 2021 [ECF No. 28]. For the reasons discussed in open court, the Court hereby ORDERS AND ADJUDGES as follows:

1. Defendant Nexus Capital Management, LLC, shall obtain counsel permitted to practice law before this Court and have counsel enter a notice of appearance on the electronic docket by no later than June 14, 2021.

2. Furthermore, by no later than June 14, 2021, Defendant Michael J. Krantz is directed to either: (1) retain counsel permitted to practice before the Court and notify the Court of such, or (2) file a Notice of Intent to Proceed Pro Se.

3. Defendant Michael J. Krantz also is directed to contact the Clerk of Court’s Office to ensure that he receives e-mail notifications of all activity on the Court docket.

4. The Court reserves ruling on Plaintiff’s pending Motion to Strike Pleadings [ECF No. 18] until further notice.

5. The Clerk is directed to mail a copy of this Order to the address on file for Mr. Michael J. Krantz.

DONE AND ORDERED in Chambers at Fort Pierce, Florida this 28th day of May 2021.

AILEEN M. CANNON
US District Judge

cc: counsel of record

U.S. District Court
Southern District of Florida (West Palm Beach)
CIVIL DOCKET FOR CASE #: 9:21-cv-80561-AMC

Global Resource, Inc. v. Mario D. German Law Center, P.A. et al
Assigned to: Judge Aileen M. Cannon
Cause: 12:0635 Breach of Insurance Contract
Date Filed: 03/16/2021
Jury Demand: None
Nature of Suit: 190 Contract: Other
Jurisdiction: Diversity

 

Date Filed # Docket Text
06/21/2021 33 PAPERLESS ORDER denying without prejudice 31 Plaintiff’s Motion for Entry of Final Default Judgment against Defendants Nexus Capital Management, LLC, and Michael Krantz. The Court’s Order to Show Cause 32 directed Defendants Nexus Capital Management, LLC, and Michael Krantz to show written cause for their failure to comply with Court orders by June 28, 2021. In addition, the Order to Show Cause 32 provides Defendants Nexus Capital Management, LLC, and Michael Krantz one final opportunity to comply with the Court’s Order 29 requiring that they retain counsel qualified to practice before the Court, or, in the case of Mr. Krantz, to indicate an intention to proceed pro se in this matter. Accordingly, Plaintiff’s Motion is premature at this juncture and may be refiled at a later date should Defendants Nexus Capital Management, LLC, and Michael Krantz fail to comply with the Court’s Order to Show Cause. Signed by Judge Aileen M. Cannon on June 21, 2021. (ahz) (Entered: 06/21/2021)
06/17/2021 32 ORDER TO SHOW CAUSE AS TO PRO SE DEFENDANTS MICHAEL J. KRANTZ AND NEXUS CAPITAL MANAGEMENT, LLC – Show Cause Response due by 6/28/2021. Signed by Judge Aileen M. Cannon on 6/17/2021. See attached document for full details. (ail) (Entered: 06/17/2021)

COMPLAINT FOR DAMAGES

COMES NOW Plaintiff Global Resource, Inc., who brings this Complaint against Defendants on the following grounds:

JURISDICTION AND VENUE

1. This Court has diversity jurisdiction over this action pursuant to 28 U.S.C. § 1332. The matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, Plaintiff is a Delaware corporation with its principal place of business in Texas, and Defendants are citizens of Florida, as detailed in paragraphs 3 through 9, herein.

2. Venue is proper in this Court pursuant to 28 U.S.C. § 1391 because all or a substantial part of the events or omissions giving rise to Plaintiff’s claims occurred in Palm Beach County, Florida, in the Southern District of Florida.

THE PARTIES

3. Plaintiff Global Resource, Inc. (hereinafter “Global Resource”) is a Delaware corporation formed in 2004 with its principal place of business in the State of Texas. Global Resource’s sole director and owner is Sean Ramey (hereinafter “Ramey”), an individual who resides in Houston, Texas.

 

4. Defendant Mario D. German Law Center, P.A. (hereinafter “German Law Center”) is a Florida for-profit corporation formed in 1999 with its principal address at 55 N.W. Fifth Avenue 400, Boca Raton, FL 33432. On information and belief, German Law Center’s sole officer and director is Mario D. German, an individual who resides in Palm Beach County, Florida.

5. Defendant Nexus Capital Management, LLC (hereinafter “Nexus”) is a Florida limited liability company formed on or about August 1, 2013 with its principal address at 1374 Cypress Way, Boca Raton, FL 33486. Nexus’ sole member and manager is Defendant Michael
J. Krantz, an individual who resides in Palm Beach County, Florida.

6. Defendant Mario D. German (hereinafter “German”) is an individual who resides in Palm Beach County, Florida. German is the Director of Defendant German Law Center.

7. Defendant Michael J. Krantz (hereinafter “Krantz”) is an individual who resides in Palm Beach County, Florida. Krantz is the sole member, with the title of “Manager”, for Defendant Nexus.

FACTUAL ALLEGATIONS APPLICABLE TO ALL CLAIMS

8. Plaintiff Global Resource is a company engaged in the business of, among other things, purchasing automotive and industrial materials and refining them to extract a variety of residual metal compounds.

9. In connection with these activities, in or around May 2020, Global Resource entered into agreements with three suppliers for catalytic converters, evidenced by purchase orders attached as Exhibits 1-3 hereto. Specifically, those agreements provided the following:

a. Pursuant to a purchase order dated June 25, 2020, Global Resource agreed to order 1,500 kilograms of catalytic converters from a Venezuelan supplier for
$75,000 [Exhibit 1];

b. Pursuant to a purchase order dated July 12, 2020, Global Resource agreed to order 1,000 kilograms of catalytic converters from a Bolivian supplier for
$55,000 [Exhibit 2]; and

c. Pursuant to a purchase order dated July 13, 2020, Global Resource agreed to order 2,060 kilograms of catalytic converters from a Brazilian supplier for
$86,520 [Exhibit 3].1

10. Because the Suppliers were located outside the United States and did not have merchant accounts set up to receive funds directly from Plaintiff’s corporate credit account, Plaintiff and the Suppliers set out to find a solution to facilitate payment.

11. In or around May 2020, one of Plaintiff’s Suppliers referred Plaintiff to Angely Quintero, an agent of Defendant Nexus. Quintero introduced Plaintiff to Nexus, which Quintero represented was a legitimate payment service that could facilitate payments from Plaintiff to the Suppliers.

12. Quintero did not disclose to Plaintiff that Quintero had an arrangement with at least one Supplier to receive a 2.5% commission for referring Plaintiff to Nexus.

13. In or around May 2020, Quintero set up an introductory phone call between Ramey, acting for the Plaintiff, Defendant Krantz, and Joseph J. Camargo, acting as the agent for German Law Center.

1      The three suppliers will collectively be referred to herein as the “Suppliers” and the purchase orders will collectively be referred to herein as the “Purchase Orders”.

14. During that phone call, Krantz and Camargo made the following representations about Nexus and German Law Center, respectively, to Ramey:
a. Nexus was frequently engaged in providing payment services to companies and high net worth individuals who needed to transfer money overseas, including to and from Venezuelan citizens, which could be challenging to an inexperienced layperson;

b. Nexus had a large book of clients who could attest to Nexus’ legitimacy and efficacy as a payment servicer;

c. Nexus frequently, if not exclusively, utilized bank accounts belonging to German Law Center as escrow accounts for facilitating payments between its clientele;

d. German Law Center, whose representative Camargo was on the call, recognized, accepted, and actively participated in this business relationship by offering up its bank accounts for use as escrow accounts and directing funds pursuant to Nexus’ and Nexus’ clients’ instructions; and

e. Nexus and German Law Center were capable of and prepared to provide their services to Plaintiff by acting as transfer agent for the payment of funds from Plaintiff to the Suppliers.

15. Shortly thereafter, the Suppliers each signed an agreement with Nexus, titled “ESCROW / TRUST (Fiducia) AGREEMENT”, whereby Nexus represented that it would facilitate the payments from Plaintiff to the Suppliers, acting as “agent” for the transactions in exchange for a commission of 2.5% of the total payment price on each transaction (hereinafter the “Escrow Agreement(s)”). One of those agreements is attached hereto, unsigned by the supplier. [See Exhibit 4]. Discovery should yield the executed copies of these agreements, which are not in Plaintiff’s possession.
16. In July 2020, Nexus sent a letter to Plaintiff confirming Nexus’ arrangement with the Suppliers (hereinafter the “Confirmatory Letter”). Specifically, Nexus stated:
a. Nexus is retained primarily to provide Consulting, Custody, Paymaster, Escrow Services to facilitate the purchase, sale and delivery of assets to the Clients in the most secure and expeditious manner;

b. To provide the fastest most streamlined to facilitate Purchase and Sales of their assets, Nexus has engaged several Professional Associations (PA) and Law Firms to assist in these operations [sic]; and

c. Nexus is utilizing Attorney IOLTA accounts at principal USA banks to receive the funds for these transactions.

17. The Confirmatory Letter also included a list of five bank accounts at Chase, Bank of America, and Wells Fargo with corresponding Swift Codes, routing numbers, and account numbers. Under the list of bank accounts, Defendant Krantz affixed his signature on behalf of Defendant Nexus accompanied by the statement: “I hereby swear, under penalty of perjury, that the information provided herein is true and correct.” [See Exhibit 5].

18. Nexus represented to Plaintiff that it would “utilize” Defendant German Law Center for the transactions at issue. Notably, one of the Bank of America accounts listed in the Confirmatory Letter with the account number ending in “4048” was German Law Center’s IOLTA (Interest on Lawyers Trust Accounts) account. Id.

19. To fulfill Plaintiff’s obligations to the Suppliers pursuant to the Purchase Orders, and based on Defendants’ representations that they would facilitate Plaintiff’s payments, Plaintiff wired funds intended for disbursement to the Suppliers to German Law Center’s IOLTA account. Plaintiff selected the IOLTA account specifically because, among other things, Plaintiff had a general understanding that lawyer trust accounts were subject to stricter regulation.

20. Plaintiff initiated the following wires to German Law Center’s Bank of America account with the account number ending in “4048”:

21. Plaintiff wired a total of $178,400 to German Law Center. As detailed in the preceding table, the “Memo to Payee” in connection with each wire stated that the funds were intended for payment of a particular Supplier.

22. On July 1, 2020, Defendant Krantz sent an e-mail to Plaintiff instructing Plaintiff to fully execute a form titled “Release of Funds in Escrow” (hereinafter “July 1 Release Agreement”). [See Exhibit 6].

23. The July 1 Release Agreement, printed on Nexus letterhead and attached to that email, was formatted as a letter to Defendant German Law Center instructing it to release Plaintiff’s previously deposited funds for the benefit of the Suppliers.

24. Specifically, the Release Agreement instructed German Law Center to undertake the following:

You are hereby authorized to release funds sent in or otherwise deposited by me, Mr. Sean Ramey into your IOLTA account in the amount of SEVENTY TWO THOUSAND FIVE HUNDRED and 0/00 US Dollard ($72,500 USD) as provided by this agreement.

MARIO D. GERMAN LAW CENTER P.A. has received the above transfer and is in receipt of your transfer or wire receipt, and is prepared to distribute funds according to this agreement.

MARIO D. GERMAN LAW CENTER P.A. is hereby directed to disburse said funds held in escrow in the following manner; NINTY [sic] SEVEN AND A HALF Percent (97.5%) of gross transfer is to be released as directed solely by Mr. Sean Ramey (the Remitter) without delay and or limitations after the funds have fully cleared and credited into MARIO D. GERMAN LAW CENTER, P.A. Escrow Account. I, Sean Ramey direct these funds are to be distributed to Nexus Capital Management for the benefit of [one of the Suppliers]. The balance of funds held in Escrow by MARIO D. GERMAN LAW CENTER, P.A. is to be retained by Mario D. German Law Center, P.A. as fee for the Escrow and Paymaster services provided.

(all emphasis in original).

25. Additionally, the final paragraph of the Release Agreement contained the following language, titled “Disclosure”:
Once this document is duly executed it is a binding agreement that carries my full authority without any limitations whatsoever, and furthermore once the funds are transferred and or transmitted to the banking instructions as described herein above all liability and or responsibility on the part of MARIO D. GERMAN LAW CENTER, P.A. and/or Mario D. German, Esq. and or their officers is completely released without limitations and with prejudice.

(all emphasis in original).

26. On July 1, Ramey, acting for Plaintiff, executed and returned the July 1 Release Agreement to Krantz. [See Exhibit 7].

27. On July 11, 2020, Ramey executed an identical “Release of Funds in Escrow” form directing German Law Center to release 97.5% of $52,500 Plaintiff previously deposited for the benefit of the second Supplier. [See Exhibit 8].

28. On July 24, 2020, Plaintiff executed an identical “Release of Funds in Escrow” form directing German Law Center to release 97.5% of $37,900 Plaintiff previously deposited for the benefit of the third Supplier. [See Exhibit 9].

29. Defendants did not release the funds as instructed.

30. In reality, Defendants never intended to complete the transactions at issue, and, instead, transferred the money to themselves and/or for their own benefit.

31. None of the Suppliers ever received the funds deposited in German Law Center’s account for their benefit.

32. On August 14 and August 19, Plaintiff contacted Krantz and Camargo via email to inquire as to the status of the funds. Neither Krantz nor Camargo responded to these emails. See Exhibits 10 and 11.

33. On October 27, 2020, Ramey spoke with Camargo––who was, at all times acting for The German Law Center––over the phone. During this call, Camargo, on behalf of German Law Center, agreed to advance $20,000 to one of the Suppliers to facilitate shipment of the goods (which were never delivered to Plaintiff due to lack of payment). In support of this transparent stalling tactic, Defendants fabricated a wire transfer confirmation. [See Exhibit 12].

34. German Law Center never intended to pay this advance, never paid this advance, and in fact made this representation to convince Plaintiff that Defendants had not stolen Plaintiff’s funds or committed a fraud.

35. On December 14, 2020, Plaintiff emailed Krantz and Camargo once again requesting return of the funds. [See Exhibit 13]. Neither Krantz nor Camargo responded.

36. During this time period of August through December 2020, Plaintiff had several phone calls with Camargo acting for The German Law Center, who provided a variety of excuses as to what happened to Plaintiff’s money, including that (a) the money could not immediately be disbursed to the Suppliers due to anti-money laundering regulations governing large transactions with foreign individuals/entities; (b) that the Suppliers provided the wrong account numbers for disbursement; and (c) that the money had been invested in another venture and earning interest.

37. Defendants have avoided Plaintiff, concealed what happened to Plaintiff’s money, and made representations designed to lull Plaintiff into believing nothing had gone wrong so that Plaintiff would not exercise its legal rights or alert the criminal authorities.

38. Defendants fraudulently induced Plaintiff to transfer funds to German Law Center’s IOLTA account so that they could keep Plaintiff’s money for themselves or use the money for their benefit. Indeed, that is precisely what they did.

39. Apparently, Defendants did not limit their scheme to Plaintiff as they have been sued by other victims for similar fraudulent behavior, including by Recycled Paper International, LLC in the case styled Recycled Paper International, LLC v. Mario D. German Law Center, P.A., et al., Case No. 9:20-cv-81888 (S.D. Fla., Amended Complaint filed Oct. 22, 2020).

40. All conditions precedent to bringing this lawsuit have been satisfied or waived.

CLAIM I

CONVERSION AGAINST ALL DEFENDANTS

41. Plaintiff re-alleges and adopts all of the allegations set forth in paragraphs 1 through 40 above.

42. This is an action for conversion against German Law Center, German, Nexus, and Krantz.

43. German Law Center and Nexus, acting through the individuals discussed above, induced Plaintiff to transfer funds to German Law Center’s IOLTA account in connection with an agreement that Defendants would facilitate payments to Plaintiff’s Suppliers.

44. Plaintiff transferred money to German Law Center’s IOLTA account in connection with an agreement that Defendants would facilitate payments to Plaintiff’s Suppliers.

45. Defendants then converted the money by removing it from German Law Center’s IOLTA account and using it for various improper purposes or otherwise retaining it for themselves.

46. At all material times, Plaintiff was the rightful owner of the monies transferred to German Law Center’s IOLTA account.

47. Plaintiff has demanded the return of his monies, but the money has not been returned.

48. Plaintiff has been deprived of its possession of money in a manner that equates to conversion.

WHEREFORE, Plaintiff demands a judgment against Defendants, jointly and severally, for actual damages in an amount to be determined by the trier of fact, costs of the lawsuit, pre- and post-judgment interest, and such other relief as the trier of fact deems just and appropriate.

CLAIM II

CONSPIRACY TO CONVERT ASSETS AGAINST GERMAN AND KRANTZ

49. Plaintiff re-alleges and adopts all of the allegations set forth in paragraphs 1 through 40 above.

50. In or around May 2020, individual Defendants German and Krantz agreed to a series of unlawful acts that would convert Plaintiff’s money for their own benefit and benefit of others.

51. The underlying tort was conversion of Plaintiff’s money, as alleged in Claim I (which Claim is hereby incorporated, including paragraphs 41 through 48).

52. Each individual defendant had his own role in the conspiracy and performed overt acts in furtherance thereof:

a. Krantz established and managed Nexus to have an entity to enter into “Escrow Agreements” with the Suppliers and to facilitate Plaintiff’s Release Agreements with German Law Center;

b. German established and managed German Law Center and its IOLTA account, in which Plaintiff deposited the converted monies. In addition, German controlled the IOLTA account and unlawfully disbursed Plaintiff’s money from that account for his benefit, and for the benefit of the other Defendants herein.

53. Plaintiff has suffered significant damages in the loss of its money, as set forth herein, through the conversion of its money.

WHEREFORE, Plaintiff demands judgment against German and Krantz, jointly and severally, for actual damages in an amount to be determined by the trier of fact, costs of the lawsuit, pre- and post-judgment interest, and such other relief as the trier of fact deems just and proper.

CLAIM III BREACH OF CONTRACT

54. Plaintiff re-alleges and adopts all of the allegations set forth in paragraphs 1 through 40 above.

55. Plaintiff entered into an oral contract, evidenced by the Releases attached as Exhibits 7-9, for Nexus to process the funds for the benefit of the suppliers. Alternatively, Plaintiff was a third party beneficiary of the Escrow/Trust Agreement entered into between Nexus and the suppliers, an example of which is attached as Exhibit 4.

56. Under the contractual terms, Nexus, through the German Law Center IOLTA account, was required to disburse $70,687.50, $51,187.50, and $36,952.50, which Plaintiff had previously deposited into German Law Center’s IOLTA account, to Plaintiff’s Suppliers.

57. Nexus breached the terms of the agreement to disburse the funds by diverting the funds for its own benefit, and for the benefit of the other Defendants in this lawsuit.

58. Nexus’ conduct constitutes gross negligence or willful misconduct, as set forth herein, because it diverted the funds for the benefit of Defendants rather than disburse Plaintiff’s funds to the respective Suppliers as instructed.

59. Plaintiff has suffered damages as a consequence of Nexus’ material breaches of the contract.

WHEREFORE, Plaintiff prays that this Court enter judgment in its favor and against Nexus for actual damages in an amount to be determined by the trier of fact, costs of the lawsuit, pre- and post- judgment interest, and such other relief as the trier of fact deems just and appropriate.

CLAIM IV

BREACH OF FIDUCIARY DUTY AGAINST GERMAN, GERMAN LAW CENTER, AND NEXUS

60. Plaintiff re-alleges and adopts all of the allegations set forth in paragraphs 1 through 40 above.

61. German Law Center, as account holder for the IOLTA account in which Plaintiff deposited its monies in exchange for payment, was the effective trustee of Plaintiff’s funds and owed a fiduciary duty to Plaintiff.

62. German, as sole member of German Law Center, being a member of the Florida Bar and benefiting from that designation, and otherwise holding himself out as having control over German Law Center’s IOLTA account, was the effective trustee of Plaintiff’s funds and owed a fiduciary duty to Plaintiff.

63. Nexus, as the agent facilitating the transfer through the German Law Center’s IOLTA account to the suppliers of Plaintiff, owed a fiduciary duty to Plaintiff to execute the transfer according to the consent and direction of Plaintiff.

64. Indeed, German, German Law Center, and Nexus, as trustees of the funds transferred by Plaintiff with the obligation to act primarily for the benefit of Plaintiff and the suppliers, were given the trust and special confidence of Plaintiff to execute the funding instructions to the suppliers as agreed.

65. German, German Law Center, and Nexus breached their fiduciary duties by failing to disburse Plaintiff’s money consistent with its instructions and/or failing to return those funds to Plaintiff, resulting in a complete loss of all monies Plaintiff deposited in German’s and German Law Center’s IOLTA account.

66. As a result, Plaintiff has suffered financial damages in the form of the loss of all the funds deposited in German’s and German Law Center’s IOLTA account.

67. German, German Law Center, and Nexus had actual knowledge that failing to disburse Plaintiff’s money in accordance with Plaintiff’s instructions was wrong and that failure to do so would result in Plaintiff losing these funds.

68. Despite that knowledge, German, German Law Center, and Nexus intentionally pursued that course of conduct, which indeed resulted in Plaintiff’s total loss of the funds it deposited in German Law Center’s IOLTA account.

WHEREFORE, Plaintiff prays that this Court enter a judgment in its favor against German, German Law Center and Nexus for actual and punitive damages in an amount to be determined by the trier of fact, costs of the lawsuit, pre- and post-judgment interest, and such other relief as the Court deems just and appropriate.

CLAIM V

FRAUD IN THE INDUCEMENT

69. Plaintiff re-alleges and adopts all of the allegations set forth in paragraphs 1 through 40 above.

70. This action is against all defendants except German.

71. Nexus, directly and through its agent, Krantz, intentionally made false statements or omitted material facts regarding its role as escrow/transfer agent on Plaintiff’s contracts with the Suppliers, as set forth herein.

72. German Law Center, directly and through its agent, Camargo, intentionally made false statements or omitted material facts regarding its intention to hold Plaintiff’s funds in its IOLTA account and disburse Plaintiff’s funds according to Plaintiff’s instructions, as set forth herein.

73. Defendants Nexus and German Law Center, and their representatives, knew that the representations were false and intended for Plaintiff to rely on those false representations in wiring its money to German Law Center’s IOLTA account to enrich themselves.

74. Plaintiff reasonably relied on those false representations to its detriment.

Specifically, the representations and omissions caused Plaintiff to wire $178,400 to German Law Center’s IOLTA account as set forth herein, and to delay seeking enforcement of its rights while it was being led on by the ongoing fraud.

75. As a result of the false statements, material omissions, and fraudulent conduct by Defendants, Plaintiff suffered financial damages in the form of loss of the monies deposited in German Law Center’s IOLTA account.

WHEREFORE, Plaintiff prays that this Court enter judgment in its favor against all Defendants except German, awarding compensatory and punitive damages, costs of the lawsuit, and such other relief as the Court deems just and appropriate.

CLAIM VI

NEGLIGENT MISREPRESENTATION

76. Plaintiff re-alleges and adopts all of the allegations set forth in paragraphs 1 through 40 above.

77. This action is against all defendants except German.

78. Nexus, directly and through its agent, Krantz, intentionally made false statements or omitted material facts regarding its role as escrow/transfer agent on Plaintiff’s contracts with the Suppliers, as set forth herein.

79. German Law Center, directly and through its agent, Camargo, intentionally made false statements or omitted material facts regarding its intention to hold Plaintiff’s funds in its IOLTA account and disburse Plaintiff’s funds according to Plaintiff’s instructions, as set forth herein.

80. Defendants, except German, should have known that the statements made to Plaintiff were false, and would lead to Plaintiff’s reliance thereon.

81. Defendants, except German, intended for Plaintiff to rely on the false representations that, among other things, Plaintiff’s money that it deposited in German Law Center’s IOLTA account would be disbursed to the Suppliers consistent Plaintiff’s instructions.

82. Plaintiff reasonably and justifiably relied on the false statements to Plaintiff’s detriment, including, but not limited to, wiring $178,400 to German Law Center’s IOLTA account and delaying enforcement of its rights based on the false statements.

83. Defendants’ conduct, except German, constituted gross negligence as their conduct was so reckless or wanting in care, as set forth herein, that it constituted a conscious disregard for the rights of Plaintiff. Among other things, Defendants knew they intended to misappropriate Plaintiff’s money once it was deposited into German Law Center’s IOLTA account.

84. As a direct and proximate result of this conduct, Plaintiff suffered financial damages in the form of loss of the funds wired to German Law Center’s IOLTA account.
WHEREFORE, Plaintiff prays that this Court enter judgment in its favor against Defendants except German, awarding compensatory and punitive damages in an amount to be determined at trial, costs of the lawsuit, and such other relief as the Court deems just and appropriate.

CLAIM VII

UNJUST ENRICHMENT AGAINST ALL DEFENDANTS

85. Plaintiff re-alleges and adopts all of the allegations set forth in paragraphs 1 through 40 above.

86. Plaintiff conferred a benefit on all Defendants by transferring Plaintiff’s money to German Law Center’s IOLTA account, which was used to benefit all Defendants by retaining all of the funds for themselves or used for their benefits.

87. Defendants voluntarily accepted and retained the benefits conferred.

88. Defendants’ acceptance and retention of the benefits under these circumstances (of theft and/or conversion, as set forth in Count I, which is incorporated herein) makes it inequitable for Defendants to retain such benefits without returning the amount wired into German Law Center’s IOLTA account to Plaintiff.

89. Defendants have been unjustly enriched by Plaintiff’s transfer of money to German Law Center’s IOLTA account, that was kept by, and used for, Defendants’ benefit.

WHEREFORE, Plaintiff prays that this Court enter judgment in favor against all Defendants for actual damages in an amount to be determined by the trier of fact, costs of the lawsuit, pre-and post-judgment interest, and such other relief as the Court deems just and appropriate.

Respectfully submitted this 16th day of March, 2021.

WEINBERG WHEELER HUDGINS GUNN & DIAL, LLC

/s/Aaron M. Cohn
Aaron M. Cohn, Esq.
Florida Bar No.: 95552
Weinberg Wheeler Hudgins Gunn & Dial, LLC
3350 Virginia Street, Ste. 500
Miami, FL 33133
T: (305) 455-9500
F: (305) 455-9501
E-mail: acohn@wwhgd.com
malvarez@wwhgd.com
dmallqui@wwhgd.com
Counsel for Plaintiff

SILVER LAW GROUP

/s/ Scott L. Silver
Scott L. Silver
Fla. Bar No. 095631 Ryan Schwamm
Fla. Bar No. 1019116
11780 W. Sample Road Coral Springs,
Florida 33065
T: (954) 755-4799
F: (954) 755-4684
E-mail: ssilver@silverlaw.com
rshwamm@silverlaw.com
rfeinberg@silverlaw.com
Counsel for Plaintiff

The $200k Theft Case

Recycled Paper International, LLC v. JPMorgan Chase Bank, N.A. (9:20-cv-81888) District Court, S.D. Florida

REMANDED TO FLORIDA STATE COURT, DEC 2020

ORDER GRANTING MOTION TO REMAND

THIS CAUSE is before the Court on Plaintiff’s Motion to Remand [DE 20] (“Motion”). The Court has considered the Motion, Defendant JP Morgan Chase Bank

N.A.’s (“Chase”) Response [DE 27], Plaintiff’s Reply [DE 35], and the record in this case and is otherwise advised in the premises.

I.            BACKGROUND

The facts of this case are not in dispute. On or about June 12, 2020, Canacha, Inc. (“Canacha”), who is not a party to this action, attempted to transfer $202,221.96 to Plaintiff’s Chase bank account. But a hacker accessed Plaintiff’s email containing the account details and manipulated it to instruct Canacha to transfer the funds to Huatai USA, LLC, at a Chase account number that is not owned by either Plaintiff or Huatai USA, LLC. Canacha followed the instructions in the hacked email, and Chase processed the transaction on June 15, 2020. Plaintiff has yet to recover any of the fraudulently transferred funds.

Plaintiff initiated this action in the Circuit Court of the Fifteenth Judicial Circuit in and for Palm Beach County, Florida, on September 4, 2020, naming Chase as the sole defendant and asserting a single claim of a violation of Florida Statute § 670.207.1 Chase timely removed the action to federal court on October 9, 2020, under diversity jurisdiction.

Plaintiff filed its First Amended Complaint on October 22, 2020, this time also asserting claims of civil theft, conversion, and negligence against Mario D. German Law Center, P.A. (“German”), a Florida professional corporation and the alleged recipient of the transferred funds.

On the same day, Plaintiff moved to remand the case to state court, arguing that the joinder of German destroyed diversity.

I.            LEGAL STANDARD

 

Provided the requirements of original jurisdiction are satisfied, a defendant may remove a case from state court to federal court. 28 U.S.C. § 1441(a). The case must be remanded back to state court, however, “[i]f at any time before final judgment it appears that the district court lacks subject matter jurisdiction.” Id. § 1447(c). Rule

15(a) of the Federal Rules of Civil Procedure allows plaintiffs to amend a complaint once as a matter of right as long as no answer has been filed, and in all other circumstances with leave of court. Fed. R. Civ. Proc. 15(a)(1). The Rule specifies that leave to amend should be freely given “when justice so requires.” Fed. R. Civ. Proc.

15(a)(2). However, “a district court must scrutinize more closely an amended pleading that would name a new nondiverse defendant in a removed case because justice requires that the district court also balance the defendant’s interests in maintaining the federal forum.”  Dever v. Family Dollar Stores of Georgia, LLC, 755 F. App’x 866, 868 (11th Circuit 2018).

1 Florida Statute § 670.207 is a portion of the Uniform Commercial Code governing the description of beneficiaries in funds transfers.

In determining whether to permit a plaintiff to join a nondiverse defendant after removal, a district court should consider the following factors:

(1) the extent to which the purpose of the amendment is to defeat federal jurisdiction,

(2) whether the plaintiff has been dilatory in asking for amendment,

(3) whether the plaintiff will be significantly injured if amendment is not allowed, and

(4) any other factors bearing on the equities. Id.

I.             DISCUSSION

Plaintiff asserts that this balancing of equities weighs in its favor and the action should be remanded to state court.

Chase takes the opposite position, arguing that the Court should deny German’s joinder and retain jurisdiction over this action.

Applying the Dever factors, the Court finds that the joinder should be permitted and the case should be remanded to state court.

First, the Court finds that Plaintiff did not amend the Complaint for the purpose of destroying diversity. The undisputed facts show that Plaintiff was pursuing its civil theft claim against German even before it filed suit against Chase. Any party asserting a civil theft claim under Florida law is required by statute to send a written demand to the opposing party and then wait 30 days before filing suit. Fla Stat. § 772.11. Accordingly, Plaintiff delivered a demand letter to German on September 2, 2020, two days before it initiated this action against Chase. And while it is true that Plaintiff might have either waited for the expiration of the cure period before initiating this action or asserted its other two claims against German in the initial Complaint, the fact that Plaintiff did not do either of those things does not show that the joinder of German now is a mere ploy to destroy diversity. In fact, Plaintiff asserts, and Chase does not refute, that Plaintiff informed Chase of its intention to join German before Chase removed the matter.

The Court therefore concludes that the first factor weighs in favor of remand.

The Court also finds that Plaintiff has not been dilatory in amending the Complaint. Plaintiff sent the demand letter to German on September 2, 2020, and the cure period ended on October 3, 2020. Plaintiff moved to amend the Complaint on October 12, 2020, and filed the First Amended Complaint on October 22, 2020.2 Only one week elapsed after the cure period ended before Plaintiff sought leave to amend the Complaint, and only two additional weeks elapsed before Plaintiff filed the First Amended Complaint. These are not unreasonable delays. The second factor therefore also weighs in favor of remand.

Next, the Court finds that Plaintiff would be prejudiced if the case were not remanded. Plaintiff has already taken steps to recover damages from German, so this is not one of those cases where it seems unlikely that a plaintiff would seriously pursue its claims against a nondiverse defendant.

And given that Plaintiff may potentially recover treble damages against German, but not against Chase, this is also not a case where a plaintiff can be fully satisfied by the diverse defendant alone.

To require Plaintiff to maintain two separate actions in two separate courts would not only put additional strain upon Plaintiff’s resources, but it would undermine the exercise of judicial economy.

The third factor therefore also weighs in favor of remand.

2 Plaintiff withdrew its Motion for Leave to Amend Complaint, see DE 19, and, since Chase had not yet answered the initial Complaint, subsequently filed the First Amended Complaint pursuant to Rule 15(a)(1).

Finally, the Court finds that other factors bearing on the equities also support granting Plaintiff’s Motion. First, the case is still in the early stages of litigation, so remanding it would cause no unreasonable delay.

And second, Plaintiff stated in its Reply that it intends to assert a civil theft claim against an additional defendant: a Florida resident who is allegedly responsible for the hacked email and whose identity Plaintiff has just learned.3

And although Chase argues that the pendency of its yet-unripe Motion to Dismiss supports denying the Motion, the Court disagrees.

In the first instance, Chase’s argument relies upon accepting that the Motion to Dismiss is likely to succeed, and it would be inappropriate for the Court to prematurely evaluate the merits of the Motion to Dismiss. But also, Plaintiff has stated its intention of asserting an additional negligence claim against Chase based on newly-discovered information. The pendency of the Motion to Dismiss is therefore irrelevant to this proceeding.

The Court concludes that the Dever factors weigh strongly in favor of remanding this case to state court.

I.            CONCLUSION 

It is thereupon ORDERED AND ADJUDGED as follows:

  1. Plaintiff’s Motion to Remand [DE 20] is GRANTED.
  2. The case is hereby REMANDED to the Fifteenth Judicial Circuit in and for Palm Beach County.
  3. The Clerk of Court is hereby directed to forward a certified copy of this Order to the Clerk of the Fifteenth Judicial Circuit in and for Palm Beach County, Florida, re Case 50-2020-CA-009558-AF.
  4. The Clerk of Court is directed to CLOSE the case and DENY all other pending motions as MOOT.

DONE AND ORDERED in Chambers at Fort Lauderdale, Florida, on this 16th day of December, 2020.

James I Cohn
United States District Judge

Copy Provided:

Magistrate Judge William Matthewman
all counsel of record

3 Plaintiff has already presented a written demand to this individual and is waiting for the cure period to expire.

The Mortgage Fraud Case

Federal Deposit Insurance Corporation v. Mario D. German Law Center, P.A. (9:12-cv-81298) District Court, S.D. Florida

SETTLED 2 JUNE 2014 – DESPITE CLEAR MORTGAGE FRAUD BY LAWYER AS PER MARRA’s OWN ORDER

1914 Alamanda Way, Riviera Beach, FL 33404 - Sold for 220k

Sold for $88k (2014)

OPINION AND ORDER

This cause is before the Court upon Defendant Mario D. German Law Center, P.A.’s Motion to Sever Plaintiff’s Claims (DE 28). The Motion is fully briefed and ripe for review. The Court has carefully considered the Motion and is otherwise fully advised in the premises.

I. Background

On December 3, 2012, Plaintiff Federal Deposit Insurance Corporation (“FDIC”) brought this three count complaint against Defendant Mario D. German Law Center, P.A. (“Defendant”) for breach of contract (count one), breach of fiduciary duty (count two) and negligent misrepresentation (count three). The Complaint alleges the following:

AmTrust Bank (“AmTrust”) was a federally chartered savings bank with its principal place of business in Cleveland, Ohio. (Compl. ¶ 1, DE 1.)

On December 4, 2009, AmTrust was closed by the Office of Thrift Supervision and the FDIC was appointed Receiver.

(Compl. ¶ 2.)

LIT: FRAUD 1 – PROPERTY LOAN $220K for PROPERTY SOLD FOR $88K IN 2014

On or about February 10, 2009, AmTrust funded a purchase money loan in the sum of $220,000 to borrower Olivia Rudolfo (“Rudolfo”) for the purchase of property located at 1914 Alamanda Way, Riviera Beach, Florida. (Compl. ¶ 7.) Rudolfo purchased the property from Sonoma Bay, Inc. for $275,000, financed in part by the Rudolfo loan. (Compl. ¶ 8.) AmTrust required Rudolfo to pay no less than $55,928 as a cash-to-close down payment. (Compl. ¶ 9.)

Rudolfo defaulted on the loan without making a single payment.

(Compl. ¶ 10.)

Defendant was the closing agent on this loan and agreed to abide by AmTrust’s closing instructions. (Compl. ¶ 11.) Defendant certified that it closed the loan in compliance with all the conditions in those instructions. (Compl. ¶ 13.) Despite explicit instructions, Defendant closed the Rudolfo loan and disbursed funds in a matter inconsistent with the HUD-1 Settlement Statement. (Compl. ¶ 18.)

Defendant disbursed $115,500 in proceeds obtained from AmTrust loan proceeds to TLC Marketing Directors, Inc.* (“TLC”), even though the purchase contract for the transaction does not list any disbursements to TLC, TLC does not hold any lien against the property, and the disbursement is not standard in mortgage lending transactions. (Compl. ¶ 20.)

*LIT could only locate a 2008 entity named TLC Marketing Directors Incorporated, ownership by Keith Davis and Maria Davis of Jacksonville, Fl.

Defendant did not contact AmTrust to inform it of the disbursement to TLC prior to closing the Transaction, and instead closed the transaction without authorization from AmTrust to make this disbursement. (Compl. ¶ 21.)

Upon information and belief, Defendant did not collect $55,928 from Rudolfo; instead, TLC paid Rudolfo’s required cash-to-close down payment. (Compl. ¶ 22.)

Defendant did not contact AmTrust to inform it that Rudolfo did not pay his down payment. (Compl. ¶ 23.)

Thus, the true purchase price for the Rudolfo property was only $219,072 which caused AmTrust to fund a loan in excess of the true purchase price of the Rudolfo property. (Compl. ¶ 25.)

Had AmTrust known the true facts, AmTrust would not have funded the loan.

(Compl. ¶ 26.)

LIT: FRAUD 2 – PROPERTY LOAN $228,750 for PROPERTY LAST SOLD FOR $52,500 in 2011

On or about April 7, 2009, AmTrust funded a purchase money mortgage loan in the sum of $228,750 to Luis Jimenez for the purchase of property located at 1925 Alamanda Way, West Palm Beach, Florida 33404. (Compl. ¶ 27.)

Jimenez purchased the property from Sonoma for $305,000, financed in part by the Jimenez loan. (Compl. ¶ 28.)

AmTrust required Jimenez to pay no less than $81,436 as a cash-to-close down payment. (Compl. ¶ 29.)

Jimenez defaulted on the loan without making a single payment.

(Compl. ¶ 30.)

1925 Alamanda Way, Riviera Beach, FL 33404 - Last Sold for $52,500, May 2, 2011 (Redfin)

Defendant agreed to serve as closing agent in connection with this loan and agreed to abide by AmTrust’s closing instructions. (Compl. ¶ ¶ 31; 33.) Defendant closed the loan and disbursed funds in a manner inconsistent with the HUD-1 Settlement Statement. (Compl. ¶ 38.)

Defendant disbursed $144,265 in proceeds obtained from AmTrust’s loan proceeds to TLC, despite the fact that, upon information and belief, the purchase contract for the transaction did not list any disbursements to TLC, TLC did not hold any lien against the property and this disbursement was not standard in mortgage lending transactions. (Compl. ¶ 40.)

Defendant did not contact AmTrust to inform it of the disbursement to TLC prior to closing the transaction and instead closed the transaction without authorization from AmTrust to make the disbursement. (Compl. ¶ 41.)

Upon information and belief, Defendant did not collect $81,436 from Jimenez; instead, TLC paid the cash-to-close down payment. (Compl. ¶ 42.)

Defendant did not contact AmTrust to inform it that Jimenez did not pay his down payment. (Compl. ¶ 43.)

After accounting for Jimenez’ failure to pay his down payment, the true purchase price for the property was only $223,564. (Compl. ¶ 44.)

Defendant’s action caused AmTrust to fund a loan in excess of the true purchase price of the property. (Compl. ¶ 45.)

Had AmTrust known the true facts, AmTrust would not have funded the loan.

(Compl. ¶ 46.)

LIT: FRAUD 3 – PROPERTY LOAN $108K for PROPERTY SOLD FOR $82.5K IN 2014

On or about March 2, 2009, AmTrust funded a purchase money mortgage loan in the sum of $108,000 to borrower Jose Silva for the purchase of property located at 1926 Hibiscus Lane, Riviera Beach, Florida, 33404. (Compl. ¶ 47.)

Silva purchased the property from Sonoma for $240,000, financed in part by the loan. (Compl. ¶ 48.)

AmTrust required Silva to pay no less than $66,430 as a cash-to-close down payment. (Compl. ¶ 49.)

Silva defaulted on the loan after making only one payment.

(Compl. ¶ 50.)

Defendant agreed to serve as the closing agent in connection with the closing of the loan and agreed to abide by AmTrust’s closing instructions. (Compl. ¶ 51.) Despite the instructions, Defendant closed the loan and disbursed funds in a manner inconsistent with the HUD-1 Settlement Statement. (Compl. ¶ 58.)

Silva was to contribute $66,430 towards the purchase of the property. (Compl. ¶ 59.)

Defendant distributed $103,200 in proceeds obtained from AmTrust’s loan proceeds to TLC despite the fact that, upon information and belief, the purchase contract for the transaction did not list any disbursements to TLC, TLC did not hold any lien against the property and this disbursement was not standard in mortgage lending agreements. (Compl. ¶ 60.)

Defendant did not contact AmTrust to inform it of the disbursement to TLC prior to closing the transaction and instead closed the transaction without authorization from AmTrust to make the disbursement. (Compl. ¶ 61.)

Upon information and belief, Defendant did not collect $66,430; instead, TLC paid the required cash-to-close down payment. (Compl. ¶ 62.)

After accounting for Silva’s failure to pay his down payment, the true purchase price was only $173,570. (Compl. ¶ 64.)

Defendant’s actions caused AmTrust to fund a loan in excess of the true purchase price of the property and had AmTrust know the true facts, AmTrust would not have funded the loan.

(Compl. ¶ ¶ 65-66.)

1926 Hibiscus Ln, Riviera Beach, FL 33404

Sold for $82,500 (2014)

Defendant moves to sever Plaintiff’s claims, stating that these are three separate and distinct unrelated real estate transactions, with different agreements, documents, prices, transfers of money and damages.

Defendant states that it is not enough that the claims share the same closing agent for mortgage loans issued by the same lender.

In response, Plaintiff notes that the Complaint alleges similar conduct by Defendant, violation of the same contract language and involvement of the same third party, TLC.

II. Discussion

Defendant moves for severance pursuant to Rule 21 of the Federal Rules of Civil Procedure.

The Rule states, in part, “[t]he court may [ ] sever any claim against a party.” Fed. R. Civ. P. 21. “Among the factors to be considered by the court in exercising its discretion under Rule 21 are whether the claims arise from the same transaction or occurrence, whether they present some common question of law or fact, whether severance would facilitate settlement or
judicial economy, and the relative prejudice to each side if the claim is severed.” Hartley v. Clark, No. 3:09cv559/RV/EMT, 2010 WL 1187880, at * 4 (N.D. Fla. Feb. 12, 2010)

(citing Disparte v. Corporate Executive Bd., 223 F.R.D. 7, 12 (D.D.C. 2004) (severance of plaintiffs’ claims turns on considerations of whether claims arise from same transaction or occurrence, whether claims present some common question of law or fact, whether settlement of claims or judicial economy would be facilitated, whether prejudice would be avoided if severance were granted, and whether different witnesses and documentary proof are required for the separate claims);

In re High Fructose Corn Syrup Antitrust Litigation, 293 F. Supp. 2d 854, 862 (C.D.Ill.2003) (same);

Wausau Business Ins. Co. v. Turner Const. Co., 204 F.R.D. 248, 250(S.D.N.Y.2001) (same)).

Rule 42 of the Federal Rule of Civil Procedure provides: “For convenience, to avoid prejudice, or to expedite or economize, the court may order a separate trial of one or more separate issues, claims, crossclaims, counterclaims, or third-party claims. When ordering a separate trial, the court must preserve any federal right to a jury trial.” Fed. R. Civ. P. 42(b).

At this stage in the proceedings, the Court concludes that the motion to sever should be denied. With respect to discovery and mediation, there is no basis to sever the case.

Based on the allegations, the claims substantially involve the same pattern of conduct, the same legal issues and the same witnesses.

Any differences highlighted by Defendant will not impact discovery or mediation enough to require severance.

With respect to Defendant’s concern that it will be limited in the scope and quantity of interrogatories (Mot. at 4), Defendant may move the Court for permission to craft discovery in an appropriate manner for this case.

Equally unpersuasive is Defendant’s contention that “due to the overlapping allegations asserted in the Plaintiff’s three causes of action, [Defendant] is prejudiced from identifying the documents, communications and witnesses specifically attributed to each transaction, and to prepare a proper defense to each claim.” (Mot. at 5.)

To the extent Defendant feels the Complaint did not provide him an adequate basis to respond to it, the proper course of action was
to file a motion for a more definite statement. See Fed. R. Civ. P. 12(e); Swierkiewicz v. Sorema N.A., 534 U.S. 506, 514 (2002) (“If a pleading ‘fails to specify the allegations in a manner that provides sufficient notice’ or does not contain enough information to allow a responsive pleading to be framed, the proper motion to be filed is a motion for a more definite statement.”).

Finally, the Court will deny without prejudice the application to sever the trial. Once the case has been better developed, the Court can determine whether convenience, avoidance of prejudice, or judicial economy requires severance of the trial.

IV. Conclusion

Accordingly, it is hereby ORDERED AND ADJUDGED that Defendant Mario D. German Law Center, P.A.’s Motion to Sever Plaintiff’s Claims (DE 28) is DENIED.

DONE AND ORDERED in Chambers at West Palm Beach, Palm Beach County, Florida, this 5th day of September, 2013.

KENNETH A. MARRA
United States District Judge

JOINT STIPULATION OF DISMISSAL WITH PREJUDICE

Plaintiff FEDERAL DEPOSIT INSURANCE CORPORATION AS RECEIVER FOR AMTRUST BANK (“Plaintiff” or the “FDIC-R”), and Defendant, MARIO D. GERMAN LAW CENTER, P.A., (collectively “Parties”), by and through their undersigned counsel, hereby notify the Court that the parties have entered into a settlement agreement and stipulate and agree as follows, in accordance with that agreement:

  1. This action shall be dismissed with prejudice with each party to shall bear its own attorney’s fees and costs in this lawsuit.
  2. The Parties request the Court enter such order(s) as it may be necessary to effectuate the dismissal in accordance with the terms agreed to by the Parties.

WHEREFORE, the Parties respectfully request the Court enter an Order of Dismissal, dismissing this case with prejudice and further relief this Court deems just and proper.

Dated: June 2, 2014

Case No: 12-81298-CIV-MARRA/BRANSON

Respectfully submitted,

 s/ Kenneth Pollock, Esq

Kenneth Pollock, Esq.
Florida Bar. No. 69558

Gary R. Shendell, Esq.
Florida Bar No. 0964440

SHENDELL & POLLOCK, P.L.
Fountain Square
2700 N. Military Trail, Suite 150
Boca Raton, Florida 33487
Phone: (561) 241-2323
Fax: (561) 241-2330

dustin@shendellpollock.com
lisa@shendellpollock.com
grs@shendellpollock.com
Counsel for Defendant, Mario D. German Law

 s/ George Breur

Robert A. Hingston, Esq.
Florida Bar No. 181815

Michael Jay Rune, II, Esq.
Florida Bar No. 0086355

George Breur, Esq.
Florida Bar No. 33283

Welbaum Guernsey
901 Ponce De Leon Blvd., PH Suite Coral Gables, Florida 33134
Telephone: (305) 441-8900
Fax: (305)441-2255

bhingston@welbaum.com
mrune@welbaum.com
hjonczak@welbaum.com

Counsel for Plaintiff FDIC

ORDER GRANTING JOINT STIPULATION OF DISMISSAL WITH PREJUDICE

THIS CAUSE came on before the Court upon the Joint Stipulation of Dismissal With Prejudice, filed by Plaintiff FEDERAL DEPOSIT INSURANCE CORPORATION AS RECEIVER FOR AMTRUST BANK (“Plaintiff” or the “FDIC-R”), and Defendant, MARIO GERMAN LAW CENTER, P.A., (collectively “Parties”). After having reviewed the Stipulation, and being otherwise fully advised in the matter, it is hereby

ORDERED AND ADJUDGED:

  1. This case is hereby dismissed with prejudice.
  2. Each party to bear its own fees and costs.

ENTERED this           day of, June, 2014

UNITED STATES DISTRICT JUDGE

cc:       Counsel of Record

U.S. District Court
Southern District of Florida (West Palm Beach)
CIVIL DOCKET FOR CASE #: 9:12-cv-81298-KAM

Federal Deposit Insurance Corporation v. Mario D. German Law Center, P.A.
Assigned to: Judge Kenneth A. Marra
Referred to: Magistrate Judge William Matthewman
Cause: 12:1819 Default of Promissory Note
Date Filed: 12/03/2012
Date Terminated: 06/04/2014
Jury Demand: Defendant
Nature of Suit: 190 Contract: Other
Jurisdiction: U.S. Government Plaintiff
Plaintiff
Federal Deposit Insurance Corporation
as Receiver for Amtrust Bank
represented by Heather Marie Jonczak
Carlton Fields Jorder Burt
100 SE 2nd Street
Suite 4200
Miami, FL 33131
(305) 530-0050
Fax: (305) 530-0055
Email: hjonczak@cfjblaw.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICEDMelissa Jill Gomberg
Welbaum Guernsey
901 Ponce de Leon Blvd. Penthouse Suite
Coral Gables, FL 33134
(305) 441-8900
Email: mgomberg@welbaum.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICEDRobert Allen Hingston
Welbaum, Guernsey, et. al.
7740 S.W. 104 Street
Suite #204
Pinecrest, FL 33156
305-441-8900
Fax: 305-441-2255
Email: rhingston@welbaum.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICEDLindsey Fallon Thurswell Lehr
Welbaum Guernsey Hingston Et Al
Penthouse Suite
901 Ponce De Leon Blvd., Floor 10
Coral Gables, FL 33134
(305) 441-8900
Fax: (305) 441-8900
Email: Lthurswell@welbaum.com
ATTORNEY TO BE NOTICEDMichael Jay Rune , II.
Carlton Fields PA
4200
100 SE 2nd Street
Miami, FL 33131
305-530-0050
Fax: 305-530-0055
Email: mrune@carltonfields.com
ATTORNEY TO BE NOTICED
V.
Defendant
Mario D. German Law Center, P.A.
a Florida Corporation
represented by Dustin Craig Blumenthal
Goldberg Segalla
222 Lakeview Drive
Suite 800
West Palm Beach, FL 33401
561-618-4450
Fax: 561-618-4485
Email: dblumenthal@goldbergsegalla.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICEDGary Robert Shendell
Shendell & Pollock PL
One Park Place Suite 310
621 NW 53rd Street
Boca Raton, FL 33487
561-241-2323
Fax: 561-241-2330
Email: gary@shendellpollock.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICED

 

Date Filed # Docket Text
09/06/2013 32 OPINION AND ORDER, denying 28 Motion to Sever. Signed by Judge Kenneth A. Marra on 9/5/2013. (cqs) (Entered: 09/06/2013)
09/06/2013 33 Unopposed MOTION for Extension of Time to Disclose Expert Testimony by September 27, 2013 re 31 Defendant’s MOTION for Extension of Time to Disclose Expert Report re 18 Scheduling Order, Order Referring Case to Magistrate Judge, Order Referring Case to Mediation,,,,,, 15 SCHEDULING REPORT – Rule 26(f)/16.1 by Mario D. German Law Center, P.A.. Responses due by 9/23/2013 (Blumenthal, Dustin) (Entered: 09/06/2013)
09/10/2013 34 ENDORSED ORDER granting 33 Motion for Extension of Time to disclose expert testimony. Expert Discovery due by 9/27/2013. Signed by Judge Kenneth A. Marra on 9/10/2013. (ir) (Entered: 09/10/2013)
09/26/2013 35 Second MOTION for Extension of Time to Disclose Expert Testimony by Mario D. German Law Center, P.A.. Responses due by 10/15/2013 (Blumenthal, Dustin) (Entered: 09/26/2013)
10/01/2013 36 AMENDED Unopposed Second MOTION for Extension of Time To Disclose Additional Expert Testimony by Mario D. German Law Center, P.A.. Responses due by 10/18/2013 (Blumenthal, Dustin)Text Modified on 10/1/2013 (cqs). (Entered: 10/01/2013)
10/02/2013 37 ORDER granting 36 Motion for Extension of Time to disclose expert testimony. Signed by Judge Kenneth A. Marra on 10/2/2013. (ir) (Entered: 10/02/2013)
10/27/2013 38 Joint MOTION for Extension of Time Extend Discovery Cut Off and Pretrial Deadlines re 18 Scheduling Order, Order Referring Case to Judge, Order Referring Case to Mediation,,,,,, by Mario D. German Law Center, P.A.. Attorney Gary Robert Shendell added to party Mario D. German Law Center, P.A.(pty:dft). Responses due by 11/15/2013 (Attachments: # 1 Text of Proposed Order)(Shendell, Gary) (Entered: 10/27/2013)
10/30/2013 39 ORDER granting 38 Motion to Extend Discovery. Discovery due by 2/28/2014. Dispositive Motions due by 3/10/2014. Calendar Call set for 8/15/2014 10:00 AM in West Palm Beach Division before Judge Kenneth A. Marra. Jury Trial set for 8/18/2014 09:00 AM in West Palm Beach Division before Judge Kenneth A. Marra. Signed by Judge Kenneth A. Marra on 10/29/2013. (ir) (Entered: 10/30/2013)
06/02/2014 40 STIPULATION of Dismissal by Federal Deposit Insurance Corporation (Attachments: # 1 Text of Proposed Order)(Breur, George) (Entered: 06/02/2014)
06/04/2014 41 ORDER DISMISSING CASE with prejudice. All pending motions are denied as moot. This case is CLOSED. Signed by Judge Kenneth A. Marra on 6/3/2014. (ir) (Entered: 06/04/2014)

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Bankers

Another Theft of Funds Case, This Time Against SunTrust Bank

Plaintiffs, domiciled in Venezuela, assert that Truist (Sunbank) was negligent in allegedly permitting fraud and theft of funds from their bank account.

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New case. Bookmark for updates.

DE LA RIVA v. SUNTRUST BANK

(1:21-cv-24412)

District Court, S.D. Florida

DEC 21, 2021 | REPUBLISHED BY LIT: DEC 24, 2021

AMENDED NOTICE OF REMOVAL1

COMES NOW Defendant, Truist Bank, formerly known as SunTrust Bank (“Truist”), by and through undersigned counsel and pursuant to the provisions of 28 U.S.C. §§ 1332, 1441 and 1446, appearing specially so as to preserve any and all defenses available under Rule 12 of the Federal Rules of Civil Procedure, any and all defenses under the federal laws of bankruptcy and specifically preserving the right to demand arbitration pursuant to contractual agreements and the Federal Arbitration Act, 9 U.S.C. §§ 1, et seq., and hereby gives notice of the removal of this action from the Circuit Court of Miami-Dade County, Florida, to the United States District Court for the Southern District of Florida, Miami Division. In support of this notice of removal, Truist states as follows:

1 The amended notice of removal clarifies the Plaintiff’s country of domicile.

INTRODUCTION

  1. Plaintiffs, Shedir de La Riva, Claudia Gil, Adriana Gil C. and Eduardo La Riva C. (“Plaintiffs”) commenced this action by filing a complaint against Truist Bank, formerly known as SunTrust Bank, Inc. in the Circuit Court of Miami-Dade County, Florida, Case Number 2021- 025111-CA-04 (24) on or about November 12, 2021.
  2. Plaintiffs’ complaint asserts that Truist was negligent in allegedly permitting fraud and theft of funds from their bank ¶ 20.
  3. Based on these allegations, Plaintiffs seek to recover damages from Truist with in an amount exceeding $271,020.00. Compl. ¶
  4. This Court has jurisdiction over all of Plaintiffs’ claims under 28 U.S.C. § 1332, which provides federal district courts with original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000.00, and where the action is between citizens of different states. See 28 S.C. § 1332(a)(1).

A.                 The Parties are Completely Diverse.

  1. Complete diversity exists between Plaintiffs and Truist in this matter.
  2. The Plaintiffs are citizens of and domiciled in Venezuela.
  3. Truist Bank is organized under the laws of North Carolina with its principal place of business in Charlotte, North Carolina, and is a wholly-owned subsidiary of Truist Financial Corporation.
  4. Truist Financial Corporation was formed by the merger of SunTrust Banks, Inc. with and into BB&T Corporation on December 6, 2019, the merger of SunTrust Bank Holding Company into BB&T Corporation on December 7, 2019, and BB&T Corporation’s subsequent change of its name to Truist Financial Corporation (also on December 7, 2019). On December 7, 2019, SunTrust Bank merged with and into Branch Banking and Trust Company. Branch Banking and Trust Company was renamed Truist Bank. SunTrust Bank was a wholly-owned subsidiary of SunTrust Banks, Inc.
  5. Truist Financial Corporation is organized under the laws of North Carolina with its principal place of business in Charlotte, North Carolina.
  6. Accordingly, the parties are completely diverse, as Plaintiffs are citizens of Venezuela, and Truist is a citizen of North Carolina.

B.        The Amount in Controversy Exceeds $75,000.

  1. Removal is also proper because the amount in controversy exceeds the $75,000 jurisdictional threshold, exclusive of interest and costs.
  2. In the Complaint, Plaintiffs seek to recover against Truist damages in excess of $271,020.00 under two causes of action sounding in negligence and gross negligence/recklessness. See Compl. ¶ 15-32.
  3. The amount in controversy therefore exceeds $75,000, exclusive of interest and costs.
  4. Accordingly, this case is properly removable because it is between citizens of different states and the amount in controversy exceeds $75,000, exclusive of interest and costs.

ADOPTION AND RESERVATION OF DEFENSES

  1. Nothing in this notice of removal shall be interpreted as a waiver or relinquishment of any of Truist’s rights to assert any defense or affirmative matter, including, but not limited to, the defenses of: (1) lack of jurisdiction over the person; (2) improper venue; (3) insufficiency of process; (4) insufficiency of service of process; (5) improper joinder of claims and/or parties; (6) failure to state a claim; (7) the mandatory arbitrability of some or all of the claims; (8) failure to join indispensable parties; or (9) any other pertinent defense available under Fed. R. Civ. P. 12, any state or federal statute, or otherwise.

PROCEDURAL REQUIREMENTS

  1. This case is a civil action within the meaning of 28 S.C. § 1441(a).
  2. True and correct copies of “all process, pleadings, and orders” filed to date are attached hereto as Exhibit “A”, in conformity with 28 S.C. § 1446(a). There has been no other process, pleading, or order served upon Truist to date in this case.
  3. This Notice of Removal is being filed, pursuant to 28 U.S.C. § 1446, within thirty days from September 22, 2021, the date Truist was served with a copy of the See 28 U.S.C. § 1446(b).
  4. The United States District Court for the Southern District of Florida, Miami Division, is the court and division embracing the place where this action is pending in state court.
  5. Pursuant to 28 U.S.C. § 1446(d), contemporaneously with the filing of this notice of removal, Truist filed a copy of same with the clerk of the Clerk of Court in Miami-Dade County, Florida, as well as a notice of filing notice of removal. Written notice of the filing of this notice of removal has also been served upon the Plaintiff.
  6. Truist reserves the right to supplement this Notice of Removal by adding any jurisdictional defenses which may independently support a basis for removal.
  7. To the extent remand is sought by Plaintiff or otherwise visited by this Court, Truist requests the opportunity to brief the issues and submit additional arguments and evidence, and to be heard at oral argument.
  8. All defendants consent to the removal of this cause of action.

WHEREFORE, PREMISES CONSIDERED, Truist prays that this Court take jurisdiction of this action and issue all necessary orders and process to remove this action from the Circuit Court of Miami-Dade County, Florida, to the United States District Court for the Southern District of Florida.

DATED: December 22, 2021.

Respectfully submitted,

/s/ Nicholas S. Agnello                                               

Nicholas S. Agnello, Esq. (FL Bar No. 90844)
BURR & FORMAN LLP
350 East Las Olas Boulevard, Suite 1440
Ft. Lauderdale, FL 33301

Telephone: (954) 414-6200
Facsimile: (954) 414-6201

Primary Email: FLService@burr.com
Secondary Email: nagnello@burr.com
Secondary Email: rzamora@burr.com

 

David Elliott, Esq. (FL Bar No. 94237)
BURR & FORMAN LLP
420 North 20th Street, Suite 3400
Birmingham, AL 35203
Telephone: (205) 244-5631
Facsimile: (205) 244-5631

Primary Email: delliott@burr.com
Secondary Email: cwingate@burr.com
Secondary Email: sfoshee@burr.com

Counsels for Defendant Truist Bank, formerly known as SunTrust Bank, Inc.

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• Help us promote our campaign through marketing, pr, advertising and reaching out to government, law firms and anyone that will listen and can assist.

Thank you for your trust, belief and support in our conviction to help Floridian residents and citizens nationwide take back their freedom. Your Donations and your Voice are so important.



U.S. District Court
Southern District of Florida (Miami)
CIVIL DOCKET FOR CASE #: 1:21-cv-24412-JAL

DE LA RIVA et al v. SUNTRUST BANK
Assigned to: Judge Joan A. Lenard

Case in other court:  11th Judicial Circuit in and For Miami-Dade Co, Fl, 2021- 025111-CA-04 (24)

Cause: 28:1332 Diversity-Notice of Removal

Date Filed: 12/21/2021
Jury Demand: None
Nature of Suit: 190 Contract: Other
Jurisdiction: Diversity
Plaintiff
SHEDIMAR DE LA RIVA represented by Victor K. Rones
Rones & Navarro
16105 NE 18th Avenue
North Miami Beach, FL 33162
305-945-6522
Email: vrones@victorkronespa.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICED
Plaintiff
Claudia Gil represented by Victor K. Rones
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED
Plaintiff
ADRIANA GIL C. represented by Victor K. Rones
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED
Plaintiff
EDUARDO LA RIVA C. represented by Victor K. Rones
(See above for address)
LEAD ATTORNEY
ATTORNEY TO BE NOTICED
V.
Defendant
SUNTRUST BANK represented by David Alan Elliott
Burr & Forman LLP
420 North 20th Street
Suite 3400
Birmingham, AL 35203
(205) 251-3000
Fax: (205) 458-5100
Email: delliott@burr.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICEDNicholas Steven Agnello
Burr & Forman LLP
350 E. Las Olas Boulevard
Suite 1420
Ft Lauderdale, FL 33301
954 414-6202
Fax: 954-414-6201
Email: nagnello@burr.com
LEAD ATTORNEY
ATTORNEY TO BE NOTICED

 

Date Filed # Docket Text
12/21/2021 1 NOTICE OF REMOVAL (STATE COURT COMPLAINT – Complaint) Filing fee $ 402.00 receipt number AFLSDC-15266134, filed by SUNTRUST BANK. (No Answer filed/No Motion to Dismiss filed) (Attachments: # 1 Civil Cover Sheet, # 2 Docket Sheet, # 3 Exhibit State Court File)(Agnello, Nicholas) Text Modified on 12/21/2021 (scn). (Entered: 12/21/2021)
12/21/2021 2 Clerks Notice of Judge Assignment to Judge Joan A. Lenard.Pursuant to 28 USC 636(c), the parties are hereby notified that the U.S. Magistrate Judge Lauren F. Louis is available to handle any or all proceedings in this case. If agreed, parties should complete and file the Consent form found on our website. It is not necessary to file a document indicating lack of consent.

Pro se (NON-PRISONER) litigants may receive Notices of Electronic Filings (NEFS) via email after filing a Consent by Pro Se Litigant (NON-PRISONER) to Receive Notices of Electronic Filing. The consent form is available under the forms section of our website. (scn) (Entered: 12/21/2021)

12/22/2021 3 AMENDED NOTICE OF REMOVAL by SUNTRUST BANK re 1 Notice of Removal (State Court Complaint), Amended (Attachments: # 1 Exhibit) (Agnello, Nicholas) Modified on 12/22/2021 (dj). (Entered: 12/22/2021)
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Bankers

Andy’s Wells Fargo Bank Account Balance is Unexpectedly $455k Lighter and He Wants Those Funds Back

The complaint clearly needs to be fleshed out as the basic information provided is insufficient to determine even the basic facts. We’re trackin’ it.

Published

on

Tong v. Wells Fargo Bank, N.A.

(3:21-cv-01236)

District Court, M.D. Florida

DEC 17, 2021 | REPUBLISHED BY LIT: DEC 18, 2021

VERIFIED COMPLAINT AND DEMAND FOR JURY TRIAL

Plaintiff ANDY TONG hereby sues Defendant, Wells Fargo Bank, N.A., and states as follows:

Jurisdiction

1. Plaintiff, Andy Tong (“Mr. Tong”), is an individual residing in Duval County, Florida.

2. Defendant, Wells Fargo Bank, N.A. (“WFB”) is a Foreign Profit Corporation with a principal address of 420 Montgomery Street, San Francisco, California 94163.

3. All actions material to these proceedings occurred within Columbia County, Florida.

4. Venue is proper under 28 U.S.C. 1391, as all persons, local government authorities and private business entities, involved in this dispute reside or are authorized to do business within the geographic boundaries subject to the Middle District of Florida, Jacksonville Division.

5. This Court has jurisdiction of this cause pursuant to 28 U.S.C. §1331, specifically under 15 U.S.C. §1693m(g) and 28 U.S.C. §1343. 

Background

6. At all times in question, Mr. Tong was the owner and holder of Money Market Account Number xxxxxxxxx5467 (the “Account”) with Defendant, WFB.

7. The Account is located in the United States.

8. An ATM/CheckCard Number xxxxxxxxxxxx5467 (“Check Card”) was issued on the Account to Mr. Tong.

9. At all times in question, Mr. Tong was the sole authorized signatory on the Account.

10. At all times in question, Mr. Tong was living in Columbia County, Florida.

11. On or about January 11, 2021 Mr. Tong went to the Wells Fargo branch in Gainesville to withdraw money from his account and noticed unauthorized funds were withdrawn.

12. On or about January 11, 2021, Mr. Tong advised WFB and reported the unauthorized transactions on the Account and requested all records pertaining to the Account.

13. Upon notifying WFB of the unauthorized transactions, WFB representative advised Mr. Tong that the Account was frozen so that no further unauthorized transactions could be made.

14. The Check Card was never out of Mr. Tong’s possession or control.

15. Prior to January 11, 2021, Mr. Tong never learned of or had reason to suspect of any counterfeit card or of any loss or theft of Account information used to make the unauthorized transfers.

16. With the exception of the occasional gas purchase, all of the transactions identified on the attached Exhibit “A” were unauthorized (the “Unauthorized Transactions.”)

17. As a result of the Unauthorized Transactions, the Account and Mr. Tong have lost approximately $454,636.17.

18. WFB is considered a “financial institution” per 15 U.S.C. §1693a(9).

 

19. “Electronic funds transfer” is defined as “any transfer of funds . . . which is initiated through an electronic terminal, telephonic instrument, or computer or magnetic tape so as to order, instruct, or authorize a financial institution to debit or credit an account. Such term includes . . . direct deposits or withdrawals of funds ” 15 U.S.C. § 1693a(7); see also 12 C.F.R. § 205.3(b).

20. The rights, liabilities, and responsibilities of the parties to this action, with respect to the unauthorized transactions on the Account, are governed by the Electronic Fund Transfer Act (15 U.S.C. § 1693, et seq.) (the “EFTA”).

21. The purpose of the EFTA is “to provide a basic framework establishing the rights, liabilities, and responsibilities of participants in electronic fund transfer systems. The primary objective of this subchapter, however, is the provision of individual consumer rights.” (15 U.S.C. § 1693, ¶ (b) of the introduction).

22. According to § 1693m(a) of the EFTA, “ any person who fails to comply with any provision of this subchapter with respect to any consumer, except for an error resolved in accordance with section 1693f of this title, is liable to such consumer in an amount equal to the sum of (1) any actual damage sustained by such consumer as a result of such failure; (2)(A) in the case of an individual action, an amount not less than $100 nor greater than $1,000; and (3) in the case of any successful action to enforce the foregoing liability, the costs of the action, together with a reasonable attorney’s fee as determined by the court.”

23. In order to be liable to Mr. Tong under § 1693m(a) of the EFTA, WFB must have failed to resolve an error in accordance with § 1693f of the EFTA.

24. For purposes of § 1693f of the EFTA, the unauthorized transactions reported by Mr. Tong constitute errors. See, 15 U.S.C. § 1693f(f)(1).

25. Pursuant to § 1693f of the EFTA, WFB was required to investigate the unauthorized transactions reported by Mr. Tong, determine whether an error had occurred, and report or mail the results of such investigation and determination to Mr. Tong and/or the other account holders within ten (10) business days after WFB received notice of the Unauthorized Transactions (i.e., within 10 business days after January 11, 2021 or, in lieu of such requirement, WFB could have, within ten (10) business days after receiving such notice, provisionally re-credited the Account for the amount of the unauthorized transactions, subject to 15 U.S.C. § 1693g, including any applicable interest, pending the timely conclusion of WFB’s investigation and determination of whether an error had occurred on the WFB Account. See, 15 U.S.C. § 1693f(a) and (c).

26. However, during the requisite ten (10) business-day period, WFB did not report or mail the results of WFB’s investigation and determination of Mr. Tong’s claim, nor did WFB provisionally re-credited the Account for any amount of the unauthorized transactions pending the conclusion of WFB’s investigation and its determination of whether an error had occurred on WFB Account.

27. Moreover, WFB was obligated to re-credit the Account for the amount of the Unauthorized Transactions, as the Check Card used to make the Unauthorized Transactions on the Account was not an accepted card or other means of access as defined in § 1693a of the EFTA. See, 15 U.S.C. § 1693g.

28. Even if the Check Card used to make the Unauthorized Transactions on the Account had been an accepted card or other means of access, as defined in § 1693a of the EFTA, WFB would have been required to reimburse their respective portions of the Account for the amount of the Unauthorized Transactions, less a maximum of fifty dollars ($50.00). See, 15 U.S.C. § 1693g.

29. WFB never re-credited the Account for any amount.

30. By letter dated January 25, 2021, WFB denied Mr. Tong’s claim of January 11, 2021. A true and correct copy of the Claim Denial Letter is attached hereto as Composite Exhibit “B.”

31. January 25, 2021 was more than ten (10) business days after January 11, 2021.

32. In the Claim Denial Letter, WFB stated that Mr. Tong had rights to obtain records upon which WFB decision was based. See Composite Exhibit “B.”

33. WFB was required, upon request, to promptly deliver or mail to Mr. Tong reproductions of all documents upon which WFB relied on to conclude that the unauthorized transactions (i.e., errors) did not occur. See, 15 U.S.C. § 1693f(d).

34. On or about February 16, 2021, Mr. Tong requested the records upon which WFB decision was based.

35. As of the date of this filing, WFB has not reimbursed Mr. Tong for the unauthorized expenditures.

36. Mr. Tong hired the undersigned counsel to represent him in this action, and has agreed to pay a reasonable fee and costs to the undersigned counsel in connection with such representation in accordance with 15 U.S.C. §1693m(a)(3).

37. All conditions precedent to this action have been performed, have occurred, or have been waived.

COUNT I VIOLATION OF 15 U.S.C. §1693f(a)

38. Plaintiff incorporates by reference in this count all allegations set forth above in Paragraphs 1 through 37.

39. This is an action for violation of 15 U.S.C. §1693f(a), which requires WFB investigate the alleged error and mail the results of the same to the consumer within ten (10) business days.

40. WFB did not, within ten (10) business days after receiving Mr. Tong’s claim of January 11, 2021, investigate the unauthorized transactions reported by Mr. Tong, determine whether an error had occurred, and report or mail the results of such investigation and determination to Mr. Tong.

41. WFB did not, within ten (10) business days after receiving Mr. Tong’s claim of January 11, 2021, provisionally re-credited the Account for the amount of the unauthorized transactions, subject to 15 U.S.C. § 1693g, including any applicable interest, pending the timely conclusion of WFB’s investigation and determination of whether an error had occurred on the Account.

42. By failing to timely report or mail the results of its purported investigation or, in lieu thereof, provisionally re-credit the Account, WFB violated 15 U.S.C. § 1693f(a).

WHEREFORE, Plaintiff ANDY TONG demands judgment against the Defendant, WELLS FARGO BANK, N.A., for actual damages, statutory damages of $1,000.00, attorneys’ fees and costs, and interest, plus any and all other relief this Honorable Court deems just and proper.

COUNT II VIOLATION OF 15 U.S.C. §1693f(c)

43. Plaintiff incorporates by reference in this count all allegations set forth above in Paragraphs 1 through 37.

44. This is an action for violation of 15 U.S.C. §1693f(c), which permits WFB, in lieu of investigating and providing the results to the consumer within ten (10) days, provisionally recredit the consumer’s account pending the conclusion of an investigation in to the alleged errors of the account.

45. WFB did not, within ten (10) business days after receiving Mr. Tong’s claim of January 11, 2021 investigate the Unauthorized Transactions reported by Mr. Tong, determine whether an error had occurred, and report or mail the results of such investigation and determination to Mr. Tong; therefore, WFB was required to provisionally re-credited the Account, within said ten (10)-business day period, for the amount of the Unauthorized Transactions, subject to 15 U.S.C. § 1693g, including any applicable interest, pending the timely conclusion of WFB’s investigation and determination of whether an error had occurred on the Account.

46. By failing to provisionally re-credit the Account, WFB violated 15 U.S.C. § 1693f(c).

WHEREFORE, Plaintiff ANDY TONG demands judgment against the Defendant, WELLS FARGO BANK, N.A., for actual damages, statutory damages of $1,000.00, attorneys’ fees and costs, and interest, plus any and all other relief this Honorable Court deems just and proper.

COUNT III VIOLATION OF 15 U.S.C. §1693f(d)

47. Plaintiff incorporates by reference in this count all allegations set forth above in Paragraphs 1 through 37.

48. This is an action for violation of 15 U.S.C. §1693f(d), which requires that WFB provide an explanation of its findings to the consumer within three (3) business days of the conclusion of its investigation. Moreover, upon the request of the consumer, it shall promptly deliver reproduction of all financial documents relied upon in concluding that an error did not occur.

49. Upon receipt of the records request by Mr. Tong, WFB was required to promptly deliver or mail reproductions of all documents upon which WFB relied to conclude that the Unauthorized Transactions did not occur.

50. WFB did not promptly deliver or mail any documents or otherwise respond to the Mr. Tong’s records request.

51. By failing to promptly deliver or mail reproductions of all documents upon which WFB relied to conclude that the Unauthorized Transactions did not occur, WFB violated 15 U.S.C. §1693f(d).

WHEREFORE, Plaintiff, ANDY TONG demands judgment against the Defendant, WELLS FARGO BANK, N.A., for actual damages, statutory damages of $1,000.00, attorneys’ fees and costs, and interest, plus any and all other relief this Honorable Court deems just and proper.

 

COUNT IV

TREBLE DAMAGES UNDER 15 U.S.C. §1693f(e)

52. Plaintiff incorporates by reference in this count all allegations set forth above in Paragraphs 1 through 37.

53. This is an action for violation of 15 U.S.C. §1693f(e), which provides that a consumer shall be entitled to treble damages for any action if the trial court finds a violation of subsection 15 U.S.C. §1693f(c) and the financial institution did not make a good faith investigation of the alleged error; have a reasonable basis for believing the consumer’s account was not in error; or knowingly and willfully concluding the consumer’s account was not in error when such a conclusion could not reasonably have been drawn for the evidence available to the financial institution at the time of the investigation.

54. Upon information and belief, WFB (a) did not make a good faith investigation of the alleged error, or (b) did not have a reasonable basis for believing that the Account was not in error; or (c) knowingly and willfully concluded that the Account was not in error when such conclusion could not reasonably have been drawn from the evidence available to WFB at the time of its investigation; therefore, pursuant to § 1693f(e) of the EFTA, Mr. Tong is entitled to treble damages determined under § 1693m(a)(1) of the EFTA.
WHEREFORE, Plaintiff, ANDY TONG demands judgment against the Defendant, WELLS FARGO BANK, N.A., for treble the amount of actual damage suffered by Plaintiff, ANDY TONG as a result of Defendant’s violations of the EFTA, plus any and all other relief this Honorable Court deems just and proper.

COUNT V

VIOLATION OF UCC ARTICLE 4A (Fla. Stat. Chap. 670)

55. Plaintiff incorporates by reference in this count all allegations set forth above in Paragraphs 1 through 37.

56. The Unauthorized Transactions in Exhibit “A” are governed by Article 4A of the Uniform Commercial Code, codified at Fla. Stat. §§670.101, et seq. (“Article 4A”).

57. WFB’s conduct, as more fully set forth herein, violates Article 4A.

58. The Unauthorized Transactions were processed and facilitated by WFB in violation of §670.202 and/or §670.203, Fla. Stat. and is, therefore, unenforceable against the Plaintiff.

59. Specifically, the Unauthorized Transactions was not caused, directly or indirectly, by a person who was authorized to originate a wire pursuant on the WFB Account as an “Originator.”

60. By failing to contact the Plaintiff, WFB failed to comply with, and adhere to, a commercially reasonable security procedure as expressed to WFB and specifically chosen by the Plaintiff.

61. WFB failed to comply with the security procedures designed to protect the Plaintiff when it failed to contact the Plaintiff to confirm the Unauthorized Transactions. By doing so, WFB failed to accept the wire transfer require in good faith and in compliance with commercially reasonable security procedures.

62. Accordingly, the Unauthorized Transactions were not authorized and is not effective as the order of Plaintiff pursuant to §670.202, Fla. Stat. and/or is not enforceable against Plaintiffs under §670.203, Fla. Stat.

63. WFB is obligated to refund the entire amount of the Unauthorized Transactions to Plaintiff, plus interest pursuant to §670.204, Fla. Stat.

64. As a direct and proximate result of WFB’s multiple statutory violations, Plaintiff has suffered and continue to suffer damages.

WHEREFORE, Plaintiff, ANDY TONG, demands judgment against Defendant, WELLS FARGO BANK, N.A., for damages, costs and such other and further relief as this Court deems just and proper.
Demand for Jury Trial

Plaintiff, ANDY TONG, demands trial by jury on all issues so triable.

DATED this 16th day of December, 2021.

LAW OFFICE OF KELLY B. MATHIS

By: Kelly B. Mathis, Esquire
Florida Bar No. 0768588

James M. Oliver, Esquire
Florida Bar No. 0124458

3577 Cardinal Point Drive
Jacksonville, FL 32257
(904) 549-5755
Primary: kmathis@mathislaw.net
Secondary: carmen@mathislaw.net

Attorneys for Plaintiff

 

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• Continue to provide this website, content, resources, community and help center for free to the many homeowners, residents, Texans and as we’ve expanded, people nationwide who need access without a paywall or subscription.

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U.S. District Court
Middle District of Florida (Jacksonville)
CIVIL DOCKET FOR CASE #: 3:21-cv-01236-MMH-LLL

 

Tong v. Wells Fargo Bank, N.A.
Assigned to: Judge Marcia Morales Howard
Referred to: Magistrate Judge Laura Lothman Lambert
Demand: $455,000
Cause: Civil Miscellaneous Case
Date Filed: 12/16/2021
Jury Demand: None
Nature of Suit: 430 Banks and Banking
Jurisdiction: Federal Question
Plaintiff
Andy Tong represented by Kelly B. Mathis
Law Offices of Kelly B. Mathis
3577 Cardinal Point Drive
Jacksonville, FL 32257
904/549-5755
Email: kmathis@mathislaw.net
ATTORNEY TO BE NOTICED
V.
Defendant
Wells Fargo Bank, N.A.
a foreign profit corporation
Date Filed # Docket Text
12/16/2021 1 COMPLAINT against WELLS FARGO BANK, NA with Jury Demand (Filing fee $ 402 receipt number AFLMDC-19038015) filed by ANDY TONG. (Attachments: # 1 Civil Cover Sheet, # 2 Exhibit Exhibit A, # 3 Exhibit Exhibit B)(Mathis, Kelly) (Entered: 12/16/2021)
12/17/2021 2 NEW CASE ASSIGNED to Judge Marcia Morales Howard and Magistrate Judge Laura Lothman Lambert. New case number: 3:21-cv-1236-MMH-LLL. (SJB) (Entered: 12/17/2021)

L21000185243
Company Name:
ANDY TONG INVESTMENTS LLC

Date of Incorporation:
2021-04-21

Status:
ACTIVE

Company Type:
Florida Limited Liability Company

State
Florida

Annual Reports
No Annual Reports Filed

Principal Address
1044 NW EADIE ST. LAKE CITY, FL 32055

Registered Agent Name:
CASE, JONATHAN A

Registered Agent Address:
4615 WESCONNETT BLVD. JACKSONVILLE, FL 32210

updated on
2021-05-05

Director details (1)

TONG, ANDY

MGR

1044 NW EADIE ST LAKE CITY, FL 32055

Other companies with agent name CASE, JONATHAN A

A-JAX LOCAL VAPE L.L.C.
2021-02-22
ACTIVE

ACS LOADING SERVICES LLC
2019-03-11
INACTIVE

JACASE INVESTMENTS LLC
2017-08-30
ACTIVE

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Acceleration

Rewind 2008: The Home Snatchers Stole Millions of Homes, Lives and Citizen’s Trust By Unimaginable Fraud

Wall Street and the Government decided, if they were to make it through the Greatest Depression, they’d have to spin their biggest lie in the history of the United States of America. It worked.

Published

on

Invasion of the Home Snatchers

How foreclosure courts are helping big banks screw over homeowners

NOV 10, 2010 | REPUBLISHED BY LIT: DEC 4, 2021

The foreclosure lawyers down in Jacksonville had warned me, but I was skeptical. They told me the state of Florida had created a special super-high-speed housing court with a specific mandate to rubber-stamp the legally dicey foreclosures by corporate mortgage pushers like Deutsche Bank and JP Morgan Chase.

This “rocket docket,” as it is called in town, is presided over by retired judges who seem to have no clue about the insanely complex financial instruments they are ruling on — securitized mortgages and laby­rinthine derivative deals of a type that didn’t even exist when most of them were active members of the bench.

Their stated mission isn’t to decide right and wrong, but to clear cases and blast human beings out of their homes with ultimate velocity. They certainly have no incentive to penetrate the profound criminal mysteries of the great American mortgage bubble of the 2000s, perhaps the most complex Ponzi scheme in human history — an epic mountain range of corporate fraud in which Wall Street megabanks conspired first to collect huge numbers of subprime mortgages, then to unload them on unsuspecting third parties like pensions, trade unions and insurance companies (and, ultimately, you and me, as taxpayers) in the guise of AAA-rated investments.

Selling lead as gold, shit as Chanel No. 5, was the essence of the booming international fraud scheme that created most all of these now-failing home mortgages.

Looting Main Street

The rocket docket wasn’t created to investigate any of that. It exists to launder the crime and bury the evidence by speeding thousands of fraudulent and predatory loans to the ends of their life cycles, so that the houses attached to them can be sold again with clean paperwork.

The judges, in fact, openly admit that their primary mission is not justice but speed.

One Jacksonville judge, the Honorable A.C. Soud, even told a local newspaper that his goal is to resolve 25 cases per hour.

Given the way the system is rigged, that means His Honor could well be throwing one ass on the street every 2.4 minutes.

Foreclosure lawyers told me one other thing about the rocket docket. The hearings, they said, aren’t exactly public.

“The judges might give you a hard time about watching,” one lawyer warned. “They’re not exactly anxious for people to know about this stuff.”

Inwardly, I laughed at this — it sounded like typical activist paranoia. The notion that a judge would try to prevent any citizen, much less a member of the media, from watching an open civil hearing sounded ridiculous.

Fucked-up as everyone knows the state of Florida is, it couldn’t be that bad. It isn’t Indonesia. Right?

Well, not quite.

When I went to sit in on Judge Soud’s courtroom in downtown Jacksonville, I was treated to an intimate, and at times breathtaking, education in the horror of the foreclosure crisis, which is rapidly emerging as the even scarier sequel to the financial meltdown of 2008:

Invasion of the Home Snatchers II.

In Las Vegas, one in 25 homes is now in foreclosure.

In Fort Myers, Florida, one in 35.

In September, lenders nationwide took over a rec­ord 102,134 properties; that same month, more than a third of all home sales were distressed properties.

All told, some 820,000 Americans have already lost their homes this year, and another 1 million currently face foreclosure.

Throughout the mounting catastrophe, however, many Americans have been slow to comprehend the true nature of the mortgage disaster. They seemed to have grasped just two things about the crisis:

One, a lot of people are getting their houses foreclosed on.

Two, some of the banks doing the foreclosing seem to have misplaced their paperwork.

For most people, the former bit about homeowners not paying their damn bills is the important part, while the latter, about the sudden and strange inability of the world’s biggest and wealthiest banks to keep proper records, is incidental.

Just a little office sloppiness, and who cares?

Those deadbeat homeowners still owe the money, right?

“They had it coming to them,” is how a bartender at the Jacksonville airport put it to me.

But in reality, it’s the unpaid bills that are incidental and the lost paperwork that matters.

It turns out that underneath that little iceberg tip of exposed evidence lies a fraud so gigantic that it literally cannot be contemplated by our leaders, for fear of admitting that our entire financial system is corrupted to its core — with our great banks and even our government coffers backed not by real wealth but by vast landfills of deceptively generated and essentially worthless mortgage-backed assets.

You’ve heard of Too Big to Fail — the foreclosure crisis is Too Big for Fraud.

Think of the Bernie Madoff scam, only replicated tens of thousands of times over, infecting every corner of the financial universe. The underlying crime is so pervasive, we simply can’t admit to it — and so we are working feverishly to rubber-stamp the problem away, in sordid little backrooms in cities like Jacksonville, behind doors that shouldn’t be, but often are, closed.

And that’s just the economic side of the story.

The moral angle to the foreclosure crisis — and, of course, in capitalism we’re not supposed to be concerned with the moral stuff, but let’s mention it anyway — shows a culture that is slowly giving in to a futuristic nightmare ideology of computerized greed and unchecked financial violence.

The monster in the foreclosure crisis has no face and no brain.

The mortgages that are being foreclosed upon have no real owners. The lawyers bringing the cases to evict the humans have no real clients. It is complete and absolute legal and economic chaos.

No single limb of this vast man-­eating thing knows what the other is doing, which makes it nearly impossible to combat — and scary as hell to watch.

What follows is an account of a single hour of Judge A.C. Soud’s rocket docket in Jacksonville.

Like everything else related to the modern economy, these foreclosure hearings are conducted in what is essentially a foreign language, heavy on jargon and impenetrable to the casual observer.

It took days of interviews with experts before and after this hearing to make sense of this single hour of courtroom drama. And though the permutations of small-time scammery and grift in the foreclosure world are virtually endless — your average foreclosure case involves homeowners or investors being screwed at least five or six creative ways — a single hour of court and a few cases is enough to tell the main story.

Because if you see one of these scams, you see them all.

It’s early on a sunny Tuesday morning when I arrive at the chambers of Judge Soud, one of four rotating judges who preside over the local rocket docket.

These special foreclosure courts were established in July of this year, after the state of Florida budgeted $9.6 million to create a new court with a specific mandate to clear 62 percent of the foreclosure cases that were clogging up the system.

Rather than forcing active judges to hear thousands of individual cases, this strategy relies on retired judges who take turns churning through dozens of cases every morning, with little time to pay much attention to the particulars.

What passes for a foreclosure court in Jacksonville is actually a small conference room at the end of a hall on the fifth floor of the drab brick Duval County Courthouse. The space would just about fit a fridge and a pingpong table.

At the head of a modest conference table this morning sits Judge Soud, a small and fussy-looking man who reminds me vaguely of the actor Ben Gazzara.

On one side of the table sits James Kowalski, a former homicide prosecutor who is now defending homeowners.

A stern man with a shaved head and a laconic manner of speaking, Kowalski has helped pioneer a whole new approach to the housing mess, slowing down the mindless eviction machine by deposing the scores of “robo-signers” being hired by the banks to sign phony foreclosure affidavits by the thousands.

For his work on behalf of the dispossessed, Kowalski was recently profiled in a preposterous Wall Street Journal article that blamed attorneys like him for causing the foreclosure mess with their nuisance defense claims.

The headline: “Niche Lawyers Spawned Housing Fracas.”

On the other side of the table are the plaintiff’s attorneys, the guys who represent the banks.

On this level of the game, these lawyers refer to themselves as “bench warmers” — volume stand-ins subcontracted by the big, hired-killer law firms that work for the banks.

One of the bench warmers present today is Mark Kessler, who works for a number of lenders and giant “foreclosure mills,” including the one run by David J. Stern, a gazillionaire attorney and all-Universe asshole who last year tried to foreclose on 70,382 homeowners.

Which is a nice way to make a living, considering that Stern and his wife, Jeanine, have bought nearly $60 million in property for themselves in recent years, including a 9,273-square-foot manse in Fort Lauderdale that is part of a Ritz-Carlton complex.

Kessler is a harried, middle-aged man in glasses who spends the morning perpetually fighting to organize a towering stack of folders, each one representing a soon-to-be-homeless human being. It quickly becomes apparent that Kessler is barely acquainted with the names in the files, much less the details of each case.

“A lot of these guys won’t even get the folders until right before the hearing,” says Kowalski.

When I arrive, Judge Soud and the lawyers are already arguing a foreclosure case; at a break in the action, I slip into the chamber with a legal-aid attorney who’s accompanying me and sit down. The judge eyes me anxiously, then proceeds.

He clears his throat, and then it’s ready, set, fraud!

Judge Soud seems to have no clue that the files he is processing at a breakneck pace are stuffed with fraudulent claims and outright lies.

“We have not encountered any fraud yet,” he recently told a local newspaper. “If we encountered fraud, it would go to [the state attorney], I can tell you that.”

But the very first case I see in his court is riddled with fraud.

Kowalski has seen hundreds of cases like the one he’s presenting this morning.

It started back in 2006, when he went to Pennsylvania to conduct what he thought would be a routine deposition of an official at the lending giant GMAC.

What he discovered was that the official — who had sworn to having personal knowledge of the case — was, in fact, just a “robo-signer” who had signed off on the file without knowing anything about the actual homeowner or his payment history.

(Kowalski’s clients, like most of the homeowners he represents, were actually making their payments on time; in this particular case, a check had been mistakenly refused by GMAC.)

Following the evidence, Kowalski discovered what has turned out to be a systemwide collapse of the process for documenting mortgages in this country.

If you’re foreclosing on somebody’s house, you are required by law to have a collection of paperwork showing the journey of that mortgage note from the moment of issuance to the present.

You should see the originating lender (a firm like Countrywide) selling the loan to the next entity in the chain (perhaps Goldman Sachs) to the next (maybe JP Morgan), with the actual note being transferred each time.

But in fact, almost no bank currently foreclosing on homeowners has a reliable record of who owns the loan; in some cases, they have even intentionally shredded the actual mortgage notes.

That’s where the robo-signers come in.

To create the appearance of paperwork where none exists, the banks drag in these pimply entry-level types — an infamous example is GMAC’s notorious robo-signer Jeffrey Stephan, who appears online looking like an age-advanced photo of Beavis or Butt-Head — and get them to sign thousands of documents a month attesting to the banks’ proper ownership of the mortgages.

This isn’t some rare goof-up by a low-level cubicle slave: Virtually every case of foreclosure in this country involves some form of screwed-up paperwork.

“I would say it’s pretty close to 100 percent,”

says Kowalski. An attorney for Jacksonville Area Legal Aid tells me that out of the hundreds of cases she has handled, fewer than five involved no phony paperwork.

“The fraud is the norm,” she says.

Kowalski’s current case before Judge Soud is a perfect example.

The Jacksonville couple he represents are being sued for delinquent payments, but the case against them has already been dismissed once before. The first time around, the plaintiff, Bank of New York Mellon, wrote in Paragraph 8 that “plaintiff owns and holds the note” on the house belonging to the couple.

But in Paragraph 3 of the same complaint, the bank reported that the note was “lost or destroyed,” while in Paragraph 4 it attests that “plaintiff cannot reasonably obtain possession of the promissory note because its whereabouts cannot be determined.”

The bank, in other words, tried to claim on paper, in court, that it both lost the note and had it, at the same time. Moreover, it claimed that it had included a copy of the note in the file, which it did — the only problem being that the note (a) was not properly endorsed, and (b) was payable not to Bank of New York but to someone else, a company called Novastar.

Now, months after its first pass at foreclosure was dismissed, the bank has refiled the case — and what do you know, it suddenly found the note. And this time, somehow, the note has the proper stamps.

“There’s a stamp that did not appear on the note that was originally filed,” Kowalski tells the judge. (This business about the stamps is hilarious. “You can get them very cheap online,” says Chip Parker, an attorney who defends homeowners in Jacksonville.)

The bank’s new set of papers also traces ownership of the loan from the original lender, Novastar, to JP Morgan and then to Bank of New York.

The bank, in other words, is trying to push through a completely new set of documents in its attempts to foreclose on Kowalski’s clients.

There’s only one problem: The dates of the transfers are completely fucked.

According to the documents, JP Morgan transferred the mortgage to Bank of New York on December 9th, 2008. But according to the same documents, JP Morgan didn’t even receive the mortgage from Novastar until February 2nd, 2009 — two months after it had supposedly passed the note along to Bank of New York.

Such rank incompetence at doctoring legal paperwork is typical of foreclosure actions, where the fraud is laid out in ink in ways that make it impossible for anyone but an overburdened, half-asleep judge to miss.

“That’s my point about all of this,”

Kowalski tells me later.

“If you’re going to lie to me, at least lie well.”

The dates aren’t the only thing screwy about the new documents submitted by Bank of New York.

Having failed in its earlier attempt to claim that it actually had the mortgage note, the bank now tries an all-of-the-above tactic.

“Plaintiff owns and holds the note,” it claims, “or is a person entitled to enforce the note.”

Soud sighs. For Kessler, the plaintiff’s lawyer, to come before him with such sloppy documents and make this preposterous argument — that his client either is or is not the note-holder — well, that puts His Honor in a tough spot.

The entire concept is a legal absurdity, and he can’t sign off on it.

With an expression of something very like regret, the judge tells Kessler,

“I’m going to have to go ahead and accept [Kowalski’s] argument.”

Now, one might think that after a bank makes multiple attempts to push phony documents through a courtroom, a judge might be pissed off enough to simply rule against that plaintiff for good.

As I witness in court all morning, the defense never gets more than one chance to screw up. But the banks get to keep filing their foreclosures over and over again, no matter how atrocious and deceitful their paperwork is.

Thus, when Soud tells Kessler that he’s dismissing the case, he hastens to add:

“Of course, I’m not going to dismiss with prejudice.” With an emphasis on the words “of course.”

Instead, Soud gives Kessler 25 days to come up with better paperwork.

Kowalski fully expects the bank to come back with new documents telling a whole new story of the note’s ownership.

“What they’re going to do, I would predict, is produce a note and say Bank of New York is not the original note-holder, but merely the servicer,” he says.

This is the dirty secret of the rocket docket

The whole system is set up to enable lenders to commit fraud over and over again, until they figure out a way to reduce the stink enough so some judge like Soud can sign off on the scam.

“If the court finds for the defendant, the plaintiffs just refile,” says Parker, the local attorney.

“The only way for the caseload to get reduced is to give it to the plaintiff. The entire process is designed with that result in mind.”

Now all of this — the obviously cooked-up documents, the magically appearing stamp and the rest of it — may just seem like nothing more than sloppy paperwork. After all, what does it matter if the bank has lost a few forms or mixed up the dates?

The homeowners still owe what they owe, and the deadbeats have no right to keep living in a house they haven’t paid for.

But what’s going on at the Jacksonville rocket docket, and in foreclosure courts all across the country, has nothing to do with sloppiness.

All this phony paperwork was actually an essential part of the mortgage bubble, an integral element of what has enabled the nation’s biggest lenders to pass off all that subprime lead as AAA gold.

In the old days, when you took out a mortgage, it was probably through a local bank or a credit union, and whoever gave you your loan held on to it for life.

If you lost your job or got too sick to work and suddenly had trouble making your payments, you could call a human being and work things out.

It was in the banker’s interest, as well as yours, to make a modified payment schedule.

From his point of view, it was better that you pay something than nothing at all.

But that all changed about a decade ago, thanks to the invention of new financial instruments that magically turned all these mortgages into high-grade investments.

Now when you took out a mortgage, your original lender — which might well have been a big mortgage mill like Countrywide or New Century — immediately sold off your loan to big banks like Deutsche and Goldman and JP Morgan.

The banks then dumped hundreds or thousands of home loans at a time into tax-exempt real estate trusts, where the loans were diced up into securities, examined and graded by the ratings agencies, and sold off to big pension funds and other institutional suckers.

Even at this stage of the game, the banks generally knew that the loans they were buying and reselling to investors were shady.

A company called Clayton Holdings, which analyzed nearly 1 million loans being prepared for sale in 2006 and 2007 by 23 banks, found that nearly half of the mortgages failed to meet the underwriting standards being promised to investors.

Citi­group, for instance, had 29 percent of its loans come up short, but it still sold a third of those mortgages to investors.

Goldman Sachs had 19 percent of its mortgages flunk the test, yet it knowingly hawked 34 percent of the risky deals to investors.

D. Keith Johnson, the head of Clayton Holdings, was so alarmed by the findings that he went to officials at three of the main ratings agencies — Moody’s, Standard and Poor’s, and Fitch’s — and tried to get them to properly evaluate the loans.

“Wouldn’t this information be great for you to have as you assign risk levels?” he asked them.

(Translation: Don’t you ratings agencies want to know that half these loans are crap before you give them a thumbs-up?)

But all three agencies rejected his advice, fearing they would lose business if they adopted tougher standards. In the end, the agencies gave large chunks of these mortgage-backed securities AAA ratings — which means “credit risk almost zero.”

Since these mortgage-backed securities paid much higher returns than other AAA investments like treasury notes or corporate bonds, the banks had no trouble attracting investors, foreign and domestic, from pension funds to insurance companies to trade unions.

The demand was so great, in fact, that they often sold mortgages they didn’t even have yet, prompting big warehouse lenders like Countrywide and New Century to rush out into the world to find more warm bodies to lend to.

In their extreme haste to get thousands and thousands of mortgages they could resell to the banks, the lenders committed an astonishing variety of fraud,

from falsifying income statements to making grossly inflated appraisals to misrepresenting properties to home buyers.

Most crucially, they gave tons and tons of credit to people who probably didn’t deserve it, and why not?

These fly-by-night mortgage companies weren’t going to hold on to these loans, not even for 10 minutes.

They were issuing this credit specifically to sell the loans off to the big banks right away, in furtherance of the larger scheme to dump fraudulent AAA-rated mortgage-backed securities on investors.

If you had a pulse, they had a house to sell you.

As bad as Countrywide and all those lenders were, the banks that had sent them out to collect these crap loans were a hundred times worse.

To sell the loans, the banks often dumped them into big tax-exempt buckets called REMICs, or Real Estate Mortgage Investment Conduits. Each one of these Enron-ish, offshore-like real estate trusts spelled out exactly what kinds of loans were supposed to be in the pool, when they were to be collected, and how they were to be managed.

In order to both preserve their tax-exempt status and deserve their AAA ratings, each of the loans in the pool had to have certain characteristics. The loans couldn’t already be in default or foreclosure at the time they were sold to investors.

If they were advertised as nice, safe, fixed-rate mortgages, they couldn’t turn out to be high-interest junk loans. And, on the most basic level, the loans had to actually exist.

In other words, if the trust stipulated that all the loans had to be collected by August 2005, the bank couldn’t still be sticking in mortgages months later.

Yet that’s exactly what the banks did. In one case handled by Jacksonville Area Legal Aid, a homeowner refinanced her house in 2005 but almost immediately got into trouble, going into default in December of that year.

Yet somehow, this woman’s loan was placed into a trust called Home Equity Loan Trust Series AE 2005-HE5 in January 2006 — five months after the deadline for that particular trust.

The loan was not only late, it was already in foreclosure — which means that, by definition, whoever the investors were in AE 2005-HE5 were getting shafted.

Why does stuff like this matter?

Because when the banks put these pools together, they were telling their investors that they were putting their money into tidy collections of real, performing home loans.

But frequently, the loans in the trust were complete shit. Or sometimes, the banks didn’t even have all the loans they said they had. But the banks sold the securities based on these pools of mortgages as AAA-rated gold anyway.

In short, all of this was a scam — and that’s why so many of these mortgages lack a true paper trail.

Had these transfers been done legally, the actual mortgage note and detailed information about all of these transactions would have been passed from entity to entity each time the mortgage was sold.

But in actual practice, the banks were often committing securities fraud (because many of the mortgages did not match the information in the prospectuses given to investors) and tax fraud (because the way the mortgages were collected and serviced often violated the strict procedures governing such investments).

Having unloaded this diseased cargo onto their unsuspecting customers, the banks had no incentive to waste money keeping “proper” documentation of all these dubious transactions.

“You’ve already committed fraud once,” says April Charney, an attorney with Jacksonville Area Legal Aid. “What do you have to lose?”

Sitting in the rocket docket, James Kowalski considers himself lucky to have won his first motion of the morning.

To get the usually intractable Judge Soud to forestall a foreclosure is considered a real victory, and I later hear Kowalski getting props and attaboys from other foreclosure lawyers.

In a great deal of these cases, in fact, the homeowners would have a pretty good chance of beating the rap, at least temporarily, if only they had lawyers fighting for them in court.

But most of them don’t.

In fact, more than 90 percent of the cases that go through Florida foreclosure courts are unopposed.

Either homeowners don’t know they can fight their foreclosures, or they simply can’t afford an attorney.

These unopposed cases are the ones the banks know they’ll win — which is why they don’t sweat it if they take the occasional whipping.

That’s why all these colorful descriptions of cases where foreclosure lawyers like Kowalski score in court are really just that — a little color.

The meat of the foreclosure crisis is the unopposed cases; that’s where the banks make their money. They almost always win those cases, no matter what’s in the files.

This becomes evident after Kowalski leaves the room.

“Who’s next?” Judge Soud says. He turns to Mark Kessler, the counsel for the big foreclosure mills. “Mark, you still got some?”

“I’ve got about three more, Judge,” says Kessler.

Kessler then drops three greenish-brown files in front of Judge Soud, who spends no more than a minute or two glancing through each one.

Then he closes the files and puts an end to the process by putting his official stamp on each foreclosure with an authoritative finality:

Kerchunk!
Kerchunk!
Kerchunk!

Each one of those kerchunks means another family on the street.

There are no faces involved here, just beat-the-clock legal machinery.

Watching Judge Soud plow through each foreclosure reminds me of the scene in Fargo where the villain played by Swedish character actor Peter Stormare pushes his victim’s leg through a wood chipper with that trademark bored look on his face.

Mechanized misery and brainless bureaucracy on the one hand, cash for the banks on the other.

What’s sad is that most Americans who have an opinion about the foreclosure crisis don’t give a shit about all the fraud involved. They don’t care that these mortgages wouldn’t have been available in the first place if the banks hadn’t found a way to sell oregano as weed to pension funds and insurance companies.

They don’t care that the Countrywides’ of the world pushed borrowers who qualified for safer fixed-­income loans into far more dangerous adjustable-rate loans, because their brokers got bigger commissions for doing so.

They don’t care that in the rush to produce loans, people were sold houses that turned out to have flood damage or worse, and they certainly don’t care that people were sold houses with inflated appraisals, which left them almost immediately underwater once housing prices started falling.

The way the banks tell it, it doesn’t matter if they defrauded homeowners and investors and taxpayers alike to get these loans.

All that matters is that a bunch of deadbeats aren’t paying their fucking bills.

“If you didn’t pay your mortgage, you shouldn’t be in your house — period,” is how Walter Todd, portfolio manager at Greenwood Capital Associates, puts it.

“People are getting upset about something that’s just procedural.”

Jamie Dimon, the CEO of JP Morgan, is even more succinct in dismissing the struggling homeowners that he and the other megabanks scammed before tossing out into the street.

“We’re not evicting people who deserve to stay in their house,” Dimon says.

There are two things wrong with this argument. (Well, more than two, actually, but let’s just stick to the two big ones.)

The first reason is: It simply isn’t true.

Many people who are being foreclosed on have actually paid their bills and followed all the instructions laid down by their banks. In some cases, a homeowner contacts the bank to say that he’s having trouble paying his bill, and the bank offers him loan modification. But the bank tells him that in order to qualify for modification, he must first be delinquent on his mortgage.

“They actually tell people to stop paying their bills for three months,” says Parker.

The authorization gets recorded in what’s known as the bank’s “contact data­base,” which records every phone call or other communication with a home­owner. But no mention of it is entered into the bank’s “number history,” which records only the payment record.

When the number history notes that the home­owner has missed three payments in a row, it has no way of knowing that the homeowner was given permission to stop making payments. “One computer generates a default letter,” says Kowalski. “Another computer contacts the credit bureaus.”

At no time is there a human being looking at the entire picture.

Which means that homeowners can be foreclosed on for all sorts of faulty reasons: misplaced checks, address errors, you name it. This inability of one limb of the foreclosure beast to know what the other limb is doing is responsible for many of the horrific stories befalling homeowners across the country.

Patti Parker, a local attorney in Jacksonville, tells of a woman whose home was seized by Deutsche Bank two days before Christmas. Months later, Deutsche came back and admitted that they had made a mistake: They had repossessed the wrong property.

In another case that made headlines in Orlando, an agent for JP Morgan mistakenly broke into a woman’s house that wasn’t even in foreclosure and tried to change the locks.

Terrified, the woman locked herself in her bathroom and called 911. But in a profound expression of the state’s reflexive willingness to side with the bad guys, the police made no arrest in the case. Breaking and entering is not a crime, apparently, when it’s authorized by a bank.

The second reason the whole they still owe the fucking money thing is bogus has to do with the changed incentives in the mortgage game.

In many cases, banks like JP Morgan are merely the servicers of all these home loans, charged with collecting your money every month and paying every penny of it into the trust, which is the real owner of your mortgage.

If you pay less than the whole amount, JP Morgan is now obligated to pay the trust the remainder out of its own pocket. When you fall behind, your bank falls behind, too. The only way it gets off the hook is if the house is foreclosed on and sold.

That’s what this foreclosure crisis is all about: fleeing the scene of the crime.

Add into the equation the fact that some of these big banks were simultaneously betting big money against these mortgages — Goldman Sachs being the prime example — and you can see that there were heavy incentives across the board to push anyone in trouble over the cliff.

Things used to be different.

Asked what percentage of struggling homeowners she used to be able to save from foreclosure in the days before securitization,

Charney is quick to answer.

“Most of them,” she says. “I seldom came across a mortgage I couldn’t work out.”

In Judge Soud’s court, I come across a shining example of this mindless rush to foreclosure when I meet Natasha Leonard, a single mother who bought a house in 2004 for $97,500.

Right after closing on the home, Leonard lost her job. But when she tried to get a modification on the loan, the bank’s offer was not helpful.

“They wanted me to pay $1,000,” she says. Which wasn’t exactly the kind of modification she was hoping for, given that her original monthly payment was $840.

“You’re paying $840, you ask for a break, and they ask you to pay $1,000?” I ask.

“Right,” she says.

Leonard now has a job and could make some kind of reduced payment. But instead of offering loan modification, the bank’s lawyers are in their fourth year of doggedly beating her brains out over minor technicalities in the foreclosure process.

That’s fine by the lawyers, who are collecting big fees.

And there appears to be no human being at the bank who’s involved enough to issue a sane decision to end the costly battle.

“If there was a real client on the other side, maybe they could work something out,” says Charney, who is representing Leonard.

In this lunatic bureaucratic jungle of securitized home loans issued by trans­national behemoths, the borrower-lender relationship can only go one of two ways: full payment, or total war.

The extreme randomness of the system is exemplified by the last case I see in the rocket docket.

While most foreclosures are unopposed, with homeowners not even bothering to show up in court to defend themselves, a few pro se defendants — people representing themselves — occasionally trickle in.

At one point during Judge Soud’s proceeding, a tallish blond woman named Shawnetta Cooper walks in with a confused look on her face.

A recent divorcee delinquent in her payments, she has come to court today fully expecting to be foreclosed on by Wells Fargo. She sits down and takes a quick look around at the lawyers who are here to kick her out of her home.

“The land has been in my family for four generations,” she tells me later. “I don’t want to be the one to lose it.”

Judge Soud pipes up and inquires if there’s a plaintiff lawyer present; someone has to lop off this woman’s head so the court can move on to the next case.

But then something unexpected happens: It turns out that Kessler is supposed to be foreclosing on her today, but he doesn’t have her folder.

The plaintiff, technically, has forgotten to show up to court.

Just minutes before, I had watched what happens when defendants don’t show up in court: kerchunk! The judge more or less automatically rules for the plaintiffs when the homeowner is a no-show.

But when the plaintiff doesn’t show, the judge is suddenly all mercy and forgiveness. Soud simply continues Cooper’s case, telling Kessler to get his shit together and come back for another whack at her in a few weeks.

Having done this, he dismisses everyone.

Stunned, Cooper wanders out of the courtroom looking like a person who has stepped up to the gallows expecting to be hanged, but has instead been handed a fruit basket and a new set of golf clubs.

I follow her out of the court, hoping to ask her about her case. But the sight of a journalist getting up to talk to a defendant in his kangaroo court clearly puts a charge into His Honor, and he immediately calls Cooper back into the conference room.

Then, to the amazement of everyone present, he issues the following speech:

“This young man,” he says, pointing at me, “is a reporter for Rolling Stone. It is your privilege to talk to him if you want.” He pauses. “It is also your privilege to not talk to him if you want.”

I stare at the judge, open-mouthed. Here’s a woman who still has to come back to this guy’s court to find out if she can keep her home, and the judge’s admonition suggests that she may run the risk of pissing him off if she talks to a reporter.

Worse, about an hour later, April Charney, the lawyer who accompanied me to court, receives an e-mail from the judge actually threatening her with contempt for bringing a stranger to his court.

Noting that “we ask that anyone other than a lawyer remain in the lobby,” Judge Soud admonishes Charney that “your unprofessional conduct and apparent authorization that the reporter could pursue a property owner immediately out of Chambers into the hallway for an interview, may very well be sited [sic] for possible contempt in the future.”

Let’s leave aside for a moment that Charney never said a word to me about speaking to Cooper.

And let’s overlook entirely the fact that the judge can’t spell the word cited.

The key here isn’t this individual judge — it’s the notion that these hearings are not and should not be entirely public. Quite clearly, foreclosure is meant to be neither seen nor heard.

After Soud’s outburst, Cooper quietly leaves the court.

Once out of sight of the judge, she shows me her file. It’s not hard to find the fraud in the case.

For starters, the assignment of mortgage is autographed by a notorious robo-signer — John Kennerty, who gave a deposition this summer admitting that he signed as many as 150 documents a day for Wells Fargo.

In Cooper’s case, the document with Kennerty’s signature on it places the date on which Wells Fargo obtained the mortgage as May 5th, 2010. The trouble is, the bank bought the loan from Wachovia — a bank that went out of business in 2008.

All of which is interesting, because in her file, it states that Wells Fargo sued Cooper for foreclosure on February 22nd, 2010.

In other words, the bank foreclosed on Cooper three months before it obtained her mortgage from a nonexistent company.

There are other types of grift and outright theft in the file.

As is typical in many foreclosure cases, Cooper is being charged by the bank for numerous attempts to serve her with papers.

But a booming industry has grown up around fraudulent process servers; companies will claim they made dozens of attempts to serve homeowners, when in fact they made just one or none at all. Who’s going to check?

The process servers cover up the crime using the same tactic as the lenders, saying they lost the original summons.

From 2000 to 2006, there was a total of 1,031 “affidavits of lost summons” here in Duval County; in the past two years, by contrast, more than 4,000 have been filed.

Cooper’s file contains a total of $371 in fees for process service, including one charge of $55 for an attempt to serve process on an “unknown tenant.”

But Cooper’s house is owner-occupied — she doesn’t even have a tenant, she tells me with a shrug.

If Mark Kessler had had his shit together in court today, Coop­er would not only be out on the street, she’d be paying for that attempt to serve papers to her nonexistent tenant.

Cooper’s case perfectly summarizes what the foreclosure crisis is all about.

Her original loan was made by Wachovia, a bank that blew itself up in 2008 speculating in the mortgage market. It was then transferred to Wells Fargo, a megabank that was handed some $50 billion in public assistance to help it acquire the corpse of Wachovia.

And who else benefited from that $50 billion in bailout money?

Billionaire Warren Buffett and his Berkshire Hathaway fund, which happens to be a major shareholder in Wells Fargo.

It was Buffett’s vice chairman, Charles Munger, who recently told America that it should “thank God” that the government bailed out banks like the one he invests in, while people who have fallen on hard times — that is, homeowners like Shawnetta Cooper — should “suck it in and cope.”

Look: It’s undeniable that many of the people facing foreclosure bear some responsibility for the crisis. Some borrowed beyond their means. Some even borrowed knowing they would never be able to pay off their debt, either hoping to flip their houses right away or taking on mortgages with low initial teaser rates without bothering to think of the future.

The culture of take-for-yourself-now, let-someone-else-pay-later wasn’t completely restricted to Wall Street. It penetrated all the way down to the individual consumer, who in some cases was a knowing accomplice in the bubble mess.

But many of these homeowners are just ordinary Joes who had no idea what they were getting into. Some were pushed into dangerous loans when they qualified for safe ones.

Others were told not to worry about future jumps in interest rates because they could just refinance down the road, or discovered that the value of their homes had been overinflated by brokers looking to pad their commissions.

And that’s not even accounting for the fact that most of this credit wouldn’t have been available in the first place without the Ponzi-like bubble scheme cooked up by Wall Street, about which the average home­owner knew nothing — hell, even the average U.S. senator didn’t know about it.

At worst, these ordinary homeowners were stupid or uninformed — while the banks that lent them the money are guilty of committing a baldfaced crime on a grand scale.

These banks robbed investors and conned homeowners, blew themselves up chasing the fraud, then begged the taxpayers to bail them out.

And bail them out we did:

We ponied up billions to help Wells Fargo buy Wachovia, paid Bank of America to buy Merrill Lynch, and watched as the Fed opened up special facilities to buy up the assets in defective mortgage trusts at inflated prices.

And after all that effort by the state to buy back these phony assets so the thieves could all stay in business and keep their bonuses, what did the banks do?

They put their foot on the foreclosure gas pedal and stepped up the effort to kick people out of their homes as fast as possible, before the world caught on to how these loans were made in the first place.

Why don’t the banks want us to see the paperwork on all these mortgages?

Because the documents represent a death sentence for them.

According to the rules of the mortgage trusts, a lender like Bank of America, which controls all the Countrywide loans, is required by law to buy back from investors every faulty loan the crooks at Countrywide ever issued.

Think about what that would do to Bank of America’s bottom line the next time you wonder why they’re trying so hard to rush these loans into someone else’s hands.

When you meet people who are losing their homes in this foreclosure crisis, they almost all have the same look of deep shame and anguish.

Nowhere else on the planet is it such a crime to be down on your luck, even if you were put there by some of the world’s richest banks, which continue to rake in record profits purely because they got a big fat handout from the government.

That’s why one banker CEO after another keeps going on TV to explain that despite their own deceptive loans and fraudulent paperwork, the real problem is these deadbeat homeowners who won’t pay their fucking bills.

And that’s why most people in this country are so ready to buy that explanation.

Because in America, it’s far more shameful to owe money than it is to steal it.

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