Thoreau, RICO & Mortgage Fraud
By: Jim Willie CB
Wednesday, 6 October 2010
Some significant events are in progress, extremely important developments in the grand pathogenesis that reflects the deep decay and deterioration in the US financial structure. The most recent events pertaining to mortgage loans, home foreclosures, and disclosed fraud carry great potential to open extremely wide cracks in the American social order. Revealed systemic fraud is slowly coming into the open. Civil disobedience has already entered the arena of popular protest. However, the recent events surrounding illegal home foreclosure seizure of properties elevates the exposed fraud to a very clear high new level. This is a boil ready to break open, releasing financial puss. The cases where people have been removed from their homes, even when no bank loan exists (as in owned free & clear), by means of fraudulent, forged, and counterfeited documents, has finally provoked RICO law provisions. Witness organized crime extended from Wall Street, whose roots lie most likely in Fannie Mae itself. The legal industry has finally joined the fray in class action lawsuits. Defense citing errors made have been met with accusations of fraud, quite a different game.
The Racketing Racketeer Influenced & Corrupt Organizations Act of 1970 was designed to fight organized crime. RICO has been invoked in class action lawsuits in at least two states in the past month, each related to mortgage fraud, securities fraud, and illegal property seizures. At the center of the firestorm lie JPMorgan Chase, Bank of America, and GMAC (now called Ally). Little did the USCongress realize that RICO laws might be used to fight profoundly deep criminal fraud on Wall Street. When the criminal activity is tracked with some forensic analysis, the roots are found with REMICs, those perverse financial instruments that functioned as umbilical cords to Fannie Mae in past years, acting like powerful centrifuges. They fed the housing bubble and mortgage finance bubble, each valued over $10 trillion in size. Bear in mind that RICO has been used primarily against mafias and crime organizations dealing with gambling, drugs, and prostitution, where property seizures are routinely carried out. Abuses have been seen in states like Florida, where motorboat owners guilty of owning small bags of marijuana have lost their boats in legal seizure. It seems that selective enforcement is obvious. The target within the crosshairs has moved to Wall Street banks and Fannie Mae under the USGovt protective wing. These are dangerous times.
Recent cases threaten to encourage the Strategic Defaults and highly charged Civil Disobedience which could actually contribute in powerful ways to commercial chaos, popular disorder, public disruptions, creeping distrust, and even systemic failure. Hundreds of thousands of people are not making their mortgage payments, intentionally stopping payments, many when they do have the ability. Over 250 thousand Bank of American mortgage holders have stopped making monthly payments, in open defiance and some financial distress. The topic of Strategic Default, together with challenges (even with attorneys) to the banks to produce legal property titles, has grown sharply in practice. The RICO cases underway threaten to toss an accelerant on that fire. Henry David Thoreau would certainly be observing closely, perhaps smiling, at the current developments of citizen action against corrupt bank practices, mortgage bond fraud, and forgery of securities as well as critical legal documents. His essay had a profound effect on me when young, when cruel abuses were observed within my catholic school locally and the Vietnam War globally. Of course, the Jackass does not sponsor, endorse, or encourage any such action, believing that the highest level bankers should receive their due. The question is what is due? Objective reporting of the news, such as the viral news of the fraudulent home foreclosures, seems to have escaped the mainstream news, a consistent theme that hints of syndicate sympathy or culpability. The last thing a network news systems wants is to encourage civil disobedience. They prefer to promote vast herds of docile sheep.