Viewpoint: Deal lets big banks off the hook

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February 23, 2012

Viewpoint: Deal lets big banks off the hook

Viewpoint John L. O'Brien The Daily News of Newburyport Thu Feb 23, 2012, 03:58 AM EST

When you enter my registry you see a sign stating, "The deeds tell the story."

Before the big banks took it upon themselves to corrupt the land recordation system, the deeds used to tell a happy story — one in which people purchased a home and lived "the American Dream." Today, however, they tell a story of greed, fraud and forgery.

By now, everyone knows what I have been doing over the past two years to expose and stop the schemes by Mortgage Electronic Recording Systems Inc. and its shareholder banks. The accuracy and integrity of the land records in my registry are of the upmost importance to me.

Earlier this month, the attorneys general of this country entered into a deal with the five largest banks that have agreed to stop robo-signing and provide principal reductions of between $20,000 and $25,000 to a million underwater homeowners.

But this amount will in no way solve the housing crisis we are faced with, nor even begin to turn our economy around. In addition, the settlement suggests that approximately 750,000 people who have had their homes foreclosed on using fraudulent documents will receive a check for $2,000.

This is merely a slap on the wrist to these lenders, and it is my opinion that this deal has been crafted for the banks and by the banks. It is not in the best interest of the consumer, the homeowner or the taxpayer. Simply put, I do not trust these lenders, who have flooded my registry with over 32,000 fraudulent documents, to do the right thing.

Those homeowners who now have corrupted titles are still looking for answers. This deal gives them none. The illegal activity by the banks is nothing shy of a criminal enterprise conducted across state lines using the Postal Service to deliver instruments that were fraudulent and contained forgeries.

I will continue to pursue my request for federal and state investigations to hold the CEOs of these banks liable for the crimes that have been committed under their watch. The only thing missing in this illegal scheme that MERS and the big banks came up with was a gun and a mask.

I will continue to expose this fraud and work every day to make sure taxpayers are fully reimbursed for the more than $44 million in lost recording fees that occurred in my district alone by institutions that believe fees are "for thee, but not for me." A message needs to be sent to these banks that while they may be too big to fail, they are not too big to go to jail.

We need a common-sense approach in order to get this economy running again. I strongly believe that the hardworking homeowners who have struggled to stay current on their mortgages should be able to refinance their homes, quickly, at a fixed rate of 3 percent. A true national program with these terms would lower payments and infuse millions into our economy immediately.

Let's not forget that foreclosures benefit no one. When a bank auctions off a home for less than is owed, that becomes the "comp" for the neighborhood. Simply put, your home and those of your neighbors are worth less. It makes far better sense to work with struggling homeowners and take whatever action is needed to keep people in their homes.

Unless we face the facts and take action, we will be talking about the same issues a year from now. I am not sure we can wait that long.

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John L. O'Brien heads the Southern Essex District Registry of Deeds in Salem.