Robo-Signing: Not Just for Mortgages Anymore!

Unless you have been living under a rock for a while, you have no doubt heard about “robo-signing” as it pertains to mortgages. Robo-signing is when the employee of a bank, or bank related company, prepares and signs documents to be used in court to foreclose on mortgages. These documents are prepared by the thousands, and the testimony of the document signers indicate they have little idea of what they are signing or even if the statements they are signing are accurate. Because of this scandal, in several states, the foreclosure process has slowed to a crawl as lawyers and judges begin to question the process. But this is an isolated case, and the banks only did that with mortgages, right? The process they use for other loans, like auto loans, credit cards, and that kind of thing is solid, and there’s nothing to worry about there, correct? Guess again. Have you heard from Chase lately on the credit card you haven’t been paying on?  Bet you haven’t. Here’s why. Linda Almonte was employed by Chase’s “Credit Card Litigation Group” in San Antonio, Texas. She had been there about six months, and frankly had butted heads with the powers that be at Chase over the accuracy of the bank’s records.  In November, 2009, Chase fired her. She sued for wrongful termination. Just another disgruntled employee with an axe to grind; you are thinking. Almonte also contacted the Office of Comptroller of Currency (OCC). This is the federal office which oversees the large national banks (Most of the brand name; too-big-to-fail-and-too-big-to-care-about-you banks are federally chartered, making them the OCC’s problem). Usually just a rubber stamp for whatever the banks want to do, the OCC for whatever reason, took Almonte seriously. Almonte told them that Chase’s records were badly messed up. For example, Chase used several computer programs for their accounting. The customer account information varied from computer program to computer program, and no effort was made to reconcile the accounts. There were incomplete records on many accounts, which were sent out for collection anyway. And there was the robosigning of the documents necessary to file the collection actions. Between the OCC and Almonte’s civil suit, lots of Chase employees and lots of Chase internal documents were provided. Most of the testimony and documents demonstrated something rather unsettling:  Almonte was right. So right, in fact, that Chase stopped sending their credit cards out for collection. They instituted a sweeping review and are supposedly cleaning up their act. Stay tuned. But this is only one of the too-big-to-fails; surely none of the others have stooped to this level? Well, not exactly. In 2006, Bank of America acquired a credit card issuer called MBNA. MBNA was not known for the accuracy of its records, or even if the debts could be collected. The MBNA debts were bundled up and sold by Bank of America in 2009 and 2010 to an outside collection agency. The debts were sold “as-is” which basically means we wash our hands of our own records. What? The document which sold the debt actually tells the debt collection agency that the bank may have no records on the accounts, or if pressed, would be unable to produce records on the accounts. It also warned the debt collectors that, among other things, the debt being sold had either been paid off in full before it was sold or was discharged in bankruptcy; the bank had no way to tell. US Bank, in a similar sale, warned debt buyers that the information may be inaccurate. Inaccurate in the way that some payments may not have been credited, or that the balances of the accounts have a 10% margin of error. If you and I keep our books with a 10% margin of error, we have our accounts frozen. If he big banks do it, they just sell the debt off. So what to do?  Challenge them. Don’t believe a word the debt collection agency tells you. Demand verification of the debt. Demand proof of their authority to collect the debt. Make them do their jobs!  Most of the time they cannot, and the problem will go away, at least for a while. There’s more, much more about this over at American Banker. It’s worth your time to read about it at: www.americanbanker.com What can you do to strike back?  MOVE YOUR MONEY. The too-big-to-fails understand only one thing: CASH. It’s what keeps them in private jet fuel and cocaine. If you are banking with them, you are part of the problem. For more information: moveyourmoneyproject.org Don’t feed the vampire squids!!