POSEIDON FUNDING LTD.; HSH NORDBANK SECURITIES S.A., & CARRERA CAPITAL FINANCE LIMITED vs. BARCLAYS BANK PLC; BARCLAYS CAPITAL INC.; SUTTON FUNDING LLC & SECURITIZED ASSET BACKED RECEIVABLES LLC

HSH Nordbank Securities S.A. v Barclays Bank PLC. Complaint

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The payee, lender and secured parties were acting as sham entities even when they were otherwise real entities, like Wells Fargo.

The banks had to make some OTHER connection between the so-called pools that were in actuality unfunded trusts --- and that explains why instead of producing real, accurate, truthful documentation they resorted to fabricated, robo-signed, robo-notarized documents executed by $10 per hour people whose only purpose was to act as "authorized signor" or "assistant secretary" neither of which designations is recognized by law. If you went to the bank to open an account or take a loan and insisted on signing with those designation they would refuse to open the account and rightfully so. But in millions of foreclosures, the reverse was NOT the case --- they relied upon such bogus documents in order to sell bogus mortgage bonds backed by unfunded pools, SPVs, Trusts, REMICS or whatever else you want to call them.

The investors are clearly taking up the cause of homeowners and they have more clout, credibility and now the proof that their money was channeled in ways neither contemplated nor agreed as per the false pooling and servicing agreements and false prospectuses that were offered by Wall Street.

We are left with defective instruments that in the end bear no connection with those pools but which have documentation fraudulently obtained from homeowner borrowers in order to get money fraudulently obtained from investor lenders. They siphoned off the money using a variety or ruses and paid the investors as though the pools were real and funded with money or assets when in fact they were empty paper sacks.

They they traded on the loans pretending that they, the banks were the owners, and they sold them multiple times. Then they foreclosed on the properties alleging they were authorized agents of the pools when the pools did not exists. No trust exists if it is unfunded. When they were done, they took the profits and put it into their own pockets, leaving both the investors high and dry and doing the same for homeowner borrowers.

They took the losses and tried to throw them at the investors and used the losses in trading to beg for Federal bailout claiming that they were on the verge of collapse, which was true as to many of them, since they were reporting assets on their balance sheet that did not exist, and they were therefore both overvalued in the stock market, over-rated in the bond market, and always on the tip of collapse. This isn't the final nail in the coffin of the mega banks but it certainly ties things down.

For homeowner borrowers, it is just as I said --- the money was never channeled through trusts and instead of was kept by the banks to use for reporting trading profits in which the left hand sold to the right hand, plus fees, expenses and various other charges. They paid the investors out of continuing sales of bogus mortgage bonds --- the classic signature of a PONZI scheme.

Thus the homeowner borrower attorneys take note: the origination documents are 99% invalid, the foreclosures are 99% invalid, and that means that the secured part of the obligation was never perfected and is fatally defective so that it can never be perfected without a signature of the homeowner borrower. That makes the obligation unsecured --- money potentially owed to unknown creditors who were not disclosed contrary to the requirements of TILA, RESPA and state deceptive lending laws.

The obligation remains, but there are no creditors who are making the claim because they could subject themselves to predatory lending claims, fraud and other charges resulting in treble damages. The note is a recital of a transaction that never existed. It recites a loan from the payee or lender when neither of them funded or even purchased the loan.

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Published In: Civil Procedure Updates, Civil Remedies Updates, Finance & Banking Updates, Residential Real Estate Updates, Securities Updates

Reference Info:Pleadings | State, 2nd Circuit, New York | United States

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Barry Fagan, Law Offices of Barry S Fagan | Attorney Advertising

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