On Sunday mornings, I enjoy my coffee with the newspaper and June 8th was the usual. I like to keep current on the housing market and all things debt, so it’s no surprise that the article entitled, Feuer targets big banks for L.A. by Michael Hiltzik (@hiltzikm) caught my attention. I am delighted to learn L.A. city attorney Mike Feuer (@Mike_Feuer) is on the offensive and taking action to recoup lost revenue by employing litigation as a regulatory device. The usual big bank suspects are on his target list including J.P. Morgan Chase, Bank of American, Wells Fargo, Ally (aka GMAC), and Citigroup being the Big five that all recently settled with 49 states for pennies on the dollar compared to the wake of destruction left behind through their shoddy business policies, fraud, lies and “robo-signing” practices.
I commend attorney Mike Feuer for taking aggressive action through his city attorney office. Southern California (#SoCal) encompasses San Luis Obispo across to the eastern line and south to the Mexican boarder. This region was among the top in the nation for damage caused during the housing crisis of 2008, with rippling effects still felt today. I have clients in cities like Compton, Long Beach and Norwalk who are African American and Latino, who have been targets of predatory lending. Remember In re Vargas (2:08-bk-17036-SB) a 2008 Chapter 7 bankruptcy case I took a close look at this case and the loan documents for Mr. Vargas, a senior citizen who had taken out a reverse mortgage on his home some years before he filed bankruptcy and the terms of the loan are shocking. Signatures were forged and the notary was not witnessed. After filing bankruptcy, the lender filed a Motion for Relief from Stay with the court so they could continue foreclosing on his home. The bank lost its motion in this case, but unfortunately cases that have followed have not faired well in bankruptcy courts in our district.
There is a definite lack of faith with the big banks and our courts where the army of consumer lawyers in SoCal have nearly given up because the banks continue to use fabricated documents to support their contentions and judges assert comments like, “You borrowed the money, and owe someone. . . .bank X is here . . . .so pay them.” The fact that California is mostly a non-judicial foreclosure state, so it’s that much easier for a bank to take back a home when the borrower doesn’t pay. It’s refreshing to see continued action to recoup losses on behalf of our local community as we continue putting the financial pieces of our lives back together.