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County supervisors urge banks to suspend foreclosures<\/strong><\/p>\nThe state legislature is broken. Not only is it broken, but it has also prevented local governments from doing what can\u2019t seem to get done in Sacramento\u2014such as providing homeowners with legal protection from banks conducting fraudulent foreclosures. That was the consensus of the Santa Cruz County Board of Supervisors at their May 15 meeting, when they adopted a resolution \u201curging\u201d (but not requiring) local banks to suspend foreclosures until beefed-up, borrower protection laws are passed by the state legislature. The laws are known collectively as the \u201cCalifornia Homeowner\u2019s Bill of Rights.\u201d<\/p>\n
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The county\u2019s resolution, which is almost identical to a resolution adopted by the City and County of San Francisco last month, falls far short of what many housing activists believe is necessary. They would prefer to see the county mandating an outright moratorium on foreclosures until a program of independent legal review and certification of legality is established.<\/p>\n
County Counsel Dana McCrea advised the Board of Supervisors that authority to mandate such a moratorium or require more stringent legal review in the foreclosure process is \u201calmost entirely\u201d preempted by current state law, and the county would almost certainly be sued, probably successfully, if it were to adopt such measures.<\/p>\n
\u201cThis speaks directly to why people have so little faith in government,\u201d Supervisor John Leopold said at the May 15 board meeting, explaining his frustration with the \u201clack of legal space\u201d at the county level to seriously challenge banks on potentially fraudulent foreclosure practices.<\/p>\n
\u201cNot only is the banking lobby making the likelihood of passing the California Homeowner\u2019s Bill of Rights very, very low in Sacramento\u2014it comes as no surprise to me that these same moneyed interests have had their way preempting local government from initiating their own, more stringent local protections,\u201d Leopold said.<\/p>\n
Apart from the fact there are between 100 and 150 foreclosure filings per month in Santa Cruz County, there are two other developments that have enraged local activists and inspired the pressure they have brought to bear on local politicians for more protection against fraudulent foreclosures. The first is a forensic audit of 382 foreclosures conducted by the City and County of San Francisco Assessor-Recorder that found 82 percent of the foreclosure cases studied were legally defective, with at least one clear violation of law, and a majority had substantial evidence of fraud, including back-dated, \u201crobo-signed\u201d or fabricated documents, as well as false claims of beneficiary status.<\/p>\n
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The second development is the drastic reduction in foreclosures in Nevada that are a direct result of a new state law requiring a notarized affidavit of authority, signed by a bank official, as a requirement of filing a foreclosure, along with clear documentation of the bank\u2019s legal right to foreclose. The law includes severe criminal penalties for any fraud. This state law reduced foreclosure filings in Nevada, formally the nation\u2019s leader in foreclosures, by 76 percent since the law took effect last October, according to Foreclosure Radar, a foreclosure data research firm.<\/p>\n \u201cIn light of the City of San Francisco\u2019s Assessor\u2019s report,\u201d Supervisor Ellen Pirie said, \u201cI\u2019m incredibly frustrated and angry\u2026 I\u2019m shocked that our legal system, which allows banks to foreclose without judicial review but seems to allow these fraudulent activities without any real supervision, and there\u2019s nothing we can do about it. I don\u2019t understand why our state legislators are not as angry as we are, and [aren\u2019t] more willing to do something about it.\u201d<\/p>\n The supervisors aren\u2019t the only ones angry about the recent, stepped-up lobbying against the California Homeowners Bill of Rights by the banking industry in Sacramento. So is Gina Green, a spokesperson for the Center for Responsible Lending (CRL), a nonprofit advocacy organization that has been a leader in the fight against predatory lending to low-income communities. After more than three years of hard work advocating for borrower protections in the mortgage industry\u2014protections now included in the California Homeowners Bill of Rights\u2014Green said the frustration is high at CRL because this legislation is getting blocked by a few, key members in the state assembly and senate, both Democrat and Republican, who she says have apparently come under the influence of the banking lobby.<\/p>\n Green says CRL is \u201cready to take the gloves off, and start naming names of those members in the state legislature who are blocking the California Homeowners Bill of Rights legislation.\u201d She goes on to say that this legislation is desperately needed, as shown by the extent of fraudulent practices brought to light in the nationwide law suit brought by 49 State Attorney Generals against five major banks last year, in which banks finally settled for $24 million in damages in February. But the banking industry continues to have a \u201cnear lock of influence in the California State legislature,\u201d Green says.<\/p>\n Jeri Bodemar, a self-described \u201cold activist\u201d and member of the Santa Cruz Women\u2019s International League for Peace and Freedom (WILPF), says the foreclosure crises just \u201cgrabbed her.\u201d As a result, she started doing outreach and organizing and began talking to Joy Hinz, a lead activist and organizer of the local Occupy Foreclosure Working Group.<\/p>\n Hinz, along with several members of the working group that originally spun off from Occupy Santa Cruz, have been attending County Board of Supervisor meetings regularly for the last several months, and encouraging the supervisors during Oral Communications to take action to protect families from foreclosure.<\/p>\n Meanwhile, Bodemar was impressed by a KPFA radio show featuring C.J. Holmes, the founder of Home Owners For Justice, a nonprofit organization waging a statewide information and organizing campaign to stop foreclosures. Bodemar and Hinz invited Holmes, who is also a long time Sonoma County real estate broker, to Santa Cruz, and co-sponsored a recent training workshop and public information event about fraudulent foreclosures practices.<\/p>\n In addition to a training workshop for \u201ccitizen fraud investigators,\u201d in which about 10 people were given an overview of what expert foreclosure fraud investigators look for, Holmes gave a three hour presentation to about 50 people at the Quaker Meeting House the evening of May 15, the same day the county supervisors adopted the foreclosure ordinance.<\/p>\n Holmes provided an in-depth analysis of how much the mortgage lending industry has changed over the course of her 25-year career in real estate brokerage, and showed that most of this change, made obvious by the combined Wall Street financial crises and collapse of the real estate market, has been for the worst. Holmes provided a fast but deeply researched summary of how the relatively safe, stodgy, local mortgage lending industry of 30 years ago was transformed into a Wall Street investor-driven casino of mortgage-backed securities, with players from all over the world.<\/p>\n One of the bottom lines, according to Holmes, is that the lack of accountability of banks in the foreclosure process is directly liked to the lack of accountability in the securitization of mortgage-baked securities sold on Wall Street, which was made technically possible by the industry created \u201cMERS\u201d recording system. Because the market crashed so hard and so fast, according to Holmes, banks had to resort to \u201cextra-legal\u201d techniques like robo-signing and forging documents to keep up with foreclosures once the \u201chouse of cards\u201d began to collapse.<\/p>\n A key problem that Holmes said should be a \u201ctake away\u201d from her talk was that the system continues to collapse, with a huge inventory of unsold, bank-owned homes, and that the idea that housing market will eventually stabilize under these conditions is misguided.<\/p>\n \u201cIt\u2019s time for us to get out of the box that banks have put us in,\u201d Hinz said after the presentation. \u201cThe banks have been setting us up for years, and gaming the system every step of the way. People are beginning to wake up and realize what\u2019s been done to them, and realizing they can\u2019t win playing by the banks rules.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":" Good Times, Wednesday, 23 May 2012 – Patrick Dwire County supervisors urge banks to suspend foreclosures The state legislature is broken. Not only is it broken, but it has also prevented local governments from doing what can\u2019t seem to get … Continue reading ![\"news1-2\"](\"http:\/\/www.gtweekly.com\/images\/stories\/052412\/news1-2.jpg\")
Since the March to Stop Foreclosures (above), which was led by Occupy Santa Cruz’s Foreclosure Working Group in March, the number of local groups and organizations joining in the effort to end the foreclosure crisis continues to grow.<\/span><\/span><\/p>\nGrowing Grass Roots<\/h1>\n