Hey Occupy, Surprise! Actual Indictments for the Financial Crisis!
November 17, 2011
Gary Trafford
Gerri Sheppard
See these pictures? Those are the first people indicted for the fraud in the mortgage mess, Gary Trafford and Gerri Sheppard.
Yesterday, Nevada Attorney General Catherine Cortez Masto threw the book at these people, with 606 felony and gross misdemeanor charges for supervising the “robo-signing” of documents to speed forecloses on Nevada residences. (You can read the full indictment here.)
”The grand jury found probable cause that there was a robo-signing scheme which resulted in the filing of tens of thousands of fraudulent documents with the Clark County Recorder’s Office between 2005 and 2008,”said Chief Deputy Attorney General John Kelleher. The indictment alleges that both defendants directed the fraudulent notarization and filing of documents which were used to initiate foreclosure on local homeowners.
These are mid-level employees for a company called Lender Processing Services, a medium size company with over 8000 employees. But it’s not a bank. It’s not Goldman Sachs or JP Morgan. So why is this so important? Because LPS is a contractor to banks, and it handled a good chunk of the foreclosures around the country. If your mortgage goes into default, there’s a good chance that your servicer would hand over your file to LPS, who would then initiate foreclosure proceedings. That these people are charged with forging paperwork suggests that the foreclosures themselves might not be legal, and that the banks may not actually have originated the mortgages properly. After all, why not just do the paperwork properly if you have the right to foreclose?
The idea here is that Trafford and Sheppard flip on their superiors, in return for lenient sentences. This is how you get up the chain of command to find out how far the fraud went. It’s also how you clarify the sequence of events, with input from the ground troops that were ordered to commit the acts.
And if it’s the case that these mortgages were problematic in the first place, then the problem hits Wall Street squarely. It flows back into the bundling of mortgage-backed securities, because it means investors were sold bundles of bad mortgages. This could unwind the whole rotten chain of events going back down the housing bubble.
That’s the theory, anyway. For now, it’s mug shots and 606 felony and misdemeanor charges against two mid-level employees who helped foreclose on a lot of families.
Just convict them all. Why bother having them roll on those above them. You put them all in jail you are going to have those who actually told them to do it. Those who didn't will turn soon enough.
dylan, check into ex gov corsine's deal.
MFGlobal stories are flying !!! An energy arbitrage positon got screwed. ICE brent position in London liquided last Nov 9. Cme NY position out yesterday. Both sides were not liquidated at the same time. On a seperate note the ex ceo of mocatta metals — henry jarecki– sold his stake in gresnham to nuveen inverstments. Jarecki is finally rpt finally getting out of the commodities futures business and not soon enough. Jarecki and his clowns on the comex were on the other side of the hunt brothers attempt to buy up the world's surplus silver in the 80s. the texans caught all of the cab drivers on the comex, including jarecki's brother, dr. jay, on the short side as prices shot up every day. the comex boys declared a national emergency, OF SORT, by saying the nation's supplies (their own wealth) was at risk. And thus they forced the hunts and a couple of other well healed guys in saudi arabia and brazil to force sell their silver at a major loss. and u thought the free enterprise system was still alive??
The one thing that this crisis has clearly demonstrated is that we have all been having our pockets picked and it still continues. I sincerely hope that these little victories, for all of us, leads to major victories for working class families.
I was just laid off from this company, a lot of employees did not know that this was happening until CBS did a special report on LPS. Then as employees we started to wonder if it was really true, then the CEO and CFO resigned, then we knew something was definitely up, but we were told not to ask questions and if approached by anyone regarding this to direct them to the Corporate office in Florida. This company did a huge lay off of over 250 employees in the month of August 2011, due to LPS outsourcing over seas, so they got rid of the production staff. The sad part of it right now is LPS claims they knew nothing about the Robo signing, they had to have known, underwriiting of LPS allowed this, so the company should also be held liable even more than the individuals.
Finally….a little action. These folks unfortunately are small potatoes in the overall scheme of things. I think we all want to see some of the more reprehensible Wall Street wise guys and "banksters" along with their political cronies and appointees thrown in jail for perpertrating the housing collapse as well as the consequential financial meltdown and aftermath which we are still dealing with. Putting a few of the honchos, for example, at JP Morgan, Citibank, Goldman Sachs, AIG, the now defunct Lehman Bros. and Fannie Mae, behind bars would send a much better message. We can always hope.
I too was laid off from LPS on August 31. When I started there, EVERYTHING was done on site. Little by little our jobs were outsourced. They don't even care about those of us who were there the longest. They kept the younger people who just skipped over what they were supposed to be doing so their production numbers were twice the required amount. That in turn made those of us actually doing the job look like we were slacking off. Such is business in today's world. One of my co-workers actually committed suicide over this layoff. Why? Because we did not lose our jobs due to lack of work or a slow down (as we were told on our way out the door), but because of outsourcing to another country that saved them billions in wages and benefits. A lot of us are well over 55 + and had given our all to go a good job for LPS. What a kick in the butt.
These are the "small potatoes"…when are we going to see indictments against the people who really caused the financial crisis????