One foreclosure case in Washington State that is still on-going, has raised the not-so-obvious question of whether or not banks are essentially “writing blank check[s] to take” homes from their owners?
Revelations from evidence in the case Knecht v. Fidelity National Title Insurance have shed light on one interesting way banks have begun the process of theft before the foreclosure is first enacted.
Scott Stafne , attorney for Knecht and partner with StafneTrumbull law firm, filed a declaration with the US District Court for the Western District of Washington at Seattle and Judge Richard A. Jones, to explain one ingenious scheme the banks use to take homes from their owners based on a general principle of ignorance that is a well known industry-standard.
In his declaration, Stafne exhibited for the court, the document used to take Knecht’s home and “initiate” the foreclosure process.
This document appears to be unofficial, yet it is all that is needed from the bank to begin the process of foreclosure.
Exhibit 1 of Stafne’s declaration reads: “The undersigned beneficiary or authorized agent for the beneficiary hereby represents and declares under the penalty of perjury that the beneficiary is the owner of the Promissory Note or other obligation secured by the Deed of Trust.”
This document is signed by Kathy Smith, signature of mortgagee, beneficiary of authorized agent.
Stafne showed that Smith cannot be the beneficiary as described in Washington State RCW 61.24.030 which defines a beneficiary as “the holder of the instrument or document evidencing the obligations secured by the deed of trust, excluding persons holding the same as security for a different obligation” because she is a robo-signer for hire.
Smith was hired by Countrywide Bank in 2010 to robo-signing a foreclosure according to documents provided from another foreclosure.
In that same year, Smith was employed by American Brokers Conduit for more robo-signing to steal homes from owners.
Yet again, Smith robo-signed another foreclosure into existence as an employee of Lender Processing Services; and this time she also claimed to be “assistant secretary, MERS as nominee for American Home Mortgage” after a change to the original document was made by the bank . . . to cover Smith’s tracks.
Shockingly, in a deposition with Stafne regarding the Knecht foreclosure, Tamara Yellin, staff attorney for Default Resolution Network (DRN) for Fidelity National Title Insurance (FNTI), explained how her organization did not have 100% proof that they had real possession of title before initiating the foreclosure process.
Yellin explained to Stafne that she is “not certain of the exact corporate structure” of the corporation she works for; however they “operate as FNTI in the state of Washington. We are all division of FNTI as the overall parent company. We are all divisions of Fidelity National Financial (FNF).”
Yellin told Stafne: “Not all states even require declaration under penalty of perjury that you’re the owner of the note. Because there are hundreds, if not thousands of securitized trusts out there and if we were to review every securitized trust agreement, we wouldn’t be able to do business.”
Staggeringly, toward the end of the deposition, Yellin revealed that FNTI had “commenced a substantial amount greater than 1000” nonjudicial foreclosures – in the 3 or 4 days prior to the deposition (in Washington State alone).
According to Washington State RCW 61.24.030(7)(a) “A declaration by the beneficiary made under the penalty of perjury stating that the beneficiary is the actual holder of the promissory note or other obligation secured by the deed of trust shall be sufficient proof as required under this subsection.”
Yet, Yellin, working for FNTI, who have initiated foreclosure against Knecht, admitted that they do not know who the actual holder of the mortgage note is.
Smith, a hired robo-signer, declared that she is the holder of the actual mortgage document; however she has made that declaration before for countless other employers.
The punchline to Stafne’s declaration is found in Exhibit 2 where Deutsche Bank National Trust Company (DBNTC) sent the homeowner another robo-signed foreclosure initiation document dated 2 months into the future!