http://www.bnd.com/2012/05/21/2183750/st....

Quote:

St. Clair County State's Attorney Brendan Kelly filed a lawsuit Monday against 22 banks, accusing them of fraud by evading requirements to file documents with the county's recorder of deeds when mortgages were bought and sold by lenders.

The suit, the first of its kind filed in Illinois, alleges mortgage companies and banks created a holding company called Mortgage Electronic Registration that, in turn, created an electronic mortgage database system. This system tracked the transfers of loans between lending institutions and Wall Street securities institutions. The database, called the Mortgage Electronic Registration System, or MERS, is used by most U.S. based lenders and included most home loans.

This system resulted in a shadow recording system, the suit alleged.

"The MERS system effectively eliminated the homeowners' and public's ability to track the purchase and sale of properties through traditional public records system," the suit stated. "Instead, this information is stored in a private database maintained by MERS. However, the MERS database is unreliable and inaccurate."

The system also allows banks and mortgage holders to avoid property transfers and fees paid to county recorders, Kelly said.

The St. Clair County recorder's office estimates through this system tens of thousands of transfers of title occurred without proper documentation. Similar actions have been filed across the country, but this is the first filed under Illinois' strong recording laws.

"We simply want these institutions follow the law," Kelly said.
Karmela F. Lejarde, Communications Manager for MERS, declined to comment.
The suit lists the plaintiffs as St. Clair County and Recorder of Deeds Mike Costello and the defendants as Mortgage Electronic Registration, Bank of America, CCO Mortgage Corporation, CitiMortgage, Corinthian Mortgage, Everhome Mortgage, Residential Funding Corporation, Guaranty Bank, HSBC Finance Corporation, Suntrust Mortgage, Wells Fargo Bank, WMC Mortgage Corporation, Bank of O'Fallon, Compass Mortgage, First Collinsville Bank, Firstco Mortgage Corp., First County Bank, Mid America Mortgage, Mortgage Services, Midland States Bank, People's National Bank, Commerce Bank, Regions Bank and UMB Bank.

Let's see if that 50-state AG settlement snuffs this one out or not - especially since St. Clair County has a well-earned reputation as being a judicial hellhole.

Let the great shakedown of the TBTF begin. The sooner the better.

I believe that any "shakedown" of or other attempt to hold the TBTF banksters accountable via civil suits will only result in the taxpayer bearing the ultimate costs, anyway.

This will likely take the form of direct gov't bailouts a la TARP (probably the least likely), indirect bailouts (a la TAF, TSLF, PDCF, AMLF, TALF, FSP, CPFF, PPIP, QE-n and god knows how many other programs), and/or other types of new programs the corrupt SOBs in the Fed and gov't can come up with.

Thus, IMO, any successes in calling the financial institutions to account via actions such as this are merely Pyrrhic victories unless the banksters themselves have their ill-gotten personal gains clawed back, serve significant hard time in prison, and/or ("and" is obviously preferable) have their necks stretched on the nearest lamp post.

I've got connections in St. Clair county. It and neighboring Madison County are as lawsuit friendly of counties as you'll find anywhere. They are at the epicenter of asbestos litigation for a reason.

Have you seen any other kinks in the bankers armor? Every time they get poked here they spit up cash.

What good are the state/federal settlement deals if a Sheriff's office won't foreclose anytime within a generation on a property whose lender violated a county court order? That in a nutshell is the underlying problem that the OCC/OTS/FRB brought upon the banking system when they let the "federal supremacy" and "bye bye Glass-Steagall" games go haywire.