DISCOVERY: BKR JUDGE FINDS CITI EVIDENCE "INCONSISTENT" AND ORDERS REAL ANSWERS

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“Regardless of decisions on standing and whether or not “real party in interest” is jurisdictional, a favorable decision to the “bank” (pretender) on those issues no longer means that they can bootstrap their position into making a credit bid at an auction or get adequate protection payments in bankruptcy or get supercedeas bond. Those things require proof that the loss is real and neither imaginery nor in the hands of someone else. And the presumption that the loss exists because of the presence of a note no longer abides. That presumption is coming under increasing attack simply because there is no truth to the pretender’s position.” — Neil Garfield

6.11.2011 Kansas BK Citi MT Compel JMK_10-41685-45

EDITOR’S NOTE: This case is important. The question is adequate protection payments in bankruptcy, which is now going against Citi because they are not going to be able to prove that they have an actual monetary loss that needs protection. The same holds true for supercedeas bond on appeal, when the same Citi or other “bank” states that they need bond or payments into the court registry to protect their “loss,” which we now know does not exist. They don’t have one dime in the deal. So what is there to protect? This Court says outright that the answer is nothing.

There is a distinction to be made that is coming to the foreground now: on the one there are technical arguments that might allow entities to initiate foreclosure actions; on the other hand there is the money trail, and the courts are getting increasingly interested in the money because they know that “follow the money” leads closer to the truth than “follow the documents.”.

Regardless of decisions on standing and whether or not “real party in interest” is jurisdictional, a favorable decision to the “bank” (pretender) on those issues no longer means that they can bootstrap their position into making a credit bid at an auction or get adequate protection payments in bankruptcy or get supercedeas bond. Those things require proof that the loss is real and neither imaginary nor in the hands of someone else. And the presumption that the loss exists because of the presence of a note no longer abides. That presumption is coming under increasing attack simply because there is no truth to the pretender’s position.

At the seminar on Saturday, we’ll talk more about this and what it means for strategy. It just might be that the pretenders are paving the way for a successful outcome for the homeowner. I think they are painting themselves into a corner. By arguing successfully for “standing” and not joining the real party in interest, there is nobody to submit a credit bid at auction, there is no loss on the table for the Judge to protect, and there is no way out of the auction sale except to pay actual cash instead of submitting a credit bid, which means, as pointed out in my private letter to the members that there are strategies available at auction which might be overlooked by most litigants and attorneys.

See go-to-the-auction-and-submit-a-bid-before-you-attack-the-foreclosure-sale-members-only-newsletter

IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF KANSAS
IN RE: DAVID ANTONIO CAMPOVERDE.    Case No. 10-41685
Chapter 7
Debtor.
ORDER GRANTING TRUSTEE’S MOTION TO SET MOTION TO COMPEL FOR EXPEDITED HEARING AND TO REQUIRE RESPONSE FROM CITIMORTGAGE

Quotes from the Court’s decision:

“The Motion does not indicate in what capacity CitiMortgage “held” those instruments. For that reason, this Court originally assumed CitiMortgage was claiming to be the beneficial owner of the instruments since no other capacity was stated.”

“CitiMortgage’s motion also states that a copy of the note is attached, but is silent on whether it is an authentic copy of the original in existence on the date of the filing of the motion. The Trustee suggests that in light of what she has found on a public website about this loan, it cannot be true that it is an authentic copy because the note contains no endorsements.”

“CitiMortgage also claimed in its Motion that “[b]y reason of the aforesaid facts, Movant lacks adequate protection of its interest in said property.”4    In so stating, again, the Court assumed that CitiMortgage held the beneficial interest in the note, because if it did not, it is unclear why it (as opposed to its principal if it is serving as an agent) would be deserving of adequate protection.”

“The contents of this Motion, however, are inconsistent with information that the Trustee has been required (in order to do her job) to ferret from a public website suggesting that CitiMortgage is, at best, the servicer of the documents in this case. Because of that perceived inconsistency, for which counsel for CitiMortgage had no explanation at the hearing, the Court ordered CitiMortgage to provide additional information to the Trustee within 30 days of a lengthy hearing conducted on February 9, 2011.”

Interestingly, CitiMortgage never alleges that any of this $158,615.90 is owed to it. It also does not plead (if it is really merely the servicer, as the Fannie Mae documents suggest) that the true beneficial owner of the note has authorized it to file this action on its behalf.
4Id. at ¶ 9 (emphasis added).

Tags: bankruptcy, borrower, countrywide, disclosure, discovery, foreclosure, foreclosure defense, foreclosure offense, foreclosures, fraud, quiet title, rescission, RESPA, securitization, TILA audit, trustee, WEISBAND
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