How Countrywide Created 3.5 Million Fraudulent Loans and What It Means to You

Posted on October 30, 2013 by

My last two articles focused on the great Securitization Swindle the banks have been perpetrating for over a decade.  It was successful because the banks created such a tangled web that it was nearly impossible for everyday people, lawyers, and judges to understand what was happening.  But what if they committed a comparatively straightforward fraud? Surely that would be caught and stopped, right?

In this month’s article I’m going to explain how Countrywide fraudulently created 3.5 MILLION loans at taxpayer expense with a scheme so simple it seems impossible they got away with it at all.

In 2003 Countrywide wanted to dominate the housing boom.  The problem they were facing was that each state has its own licensing fees, corporate taxes, and regulatory costs that Countrywide would have had to pay in order to do business.  That’s when they cooked up the scheme.  Instead of becoming licensed and registered in every state, Countrywide simply made up a trade name (DBA) that they could register in every state that would slide under the radar of the regulators.  They made up the innocuous name America’s Wholesale Lender and got to work.

Their scheme worked and nobody noticed that America’s Wholesale Lender wasn’t a corporation registered or licensed to do business in their state.  Countrywide got cranking and created 3.5 MILLION loans across every state in the country under the DBA “America’s Wholesale Lender.”

The catch is that a DBA such as America’s Wholesale Lender is not a legal entity.  It is simply a trade name.  A DBA has no ability to own property, file lawsuits, or hold any security interests

After a little while some local recorders began to notice and refused to record the loans because the lender was just a DBA, not a licensed lender in the state.  At this point Countrywide decided to commit ANOTHER fraud by listing the lender on their mortgages as “America’s Wholesale Lender, a Corporation organized and existing under the laws of New York.”  With this subtle but incredibly fraudulent change, Countrywide resubmitted the loans and they went through without a hitch.  At this point no one realized that America’s Wholesale Lender wasn’t a registered corporation at all.

Countrywide figured that, if caught, they could avoid punishment by claiming that it was all a clerical error.  Even if they couldn’t get away with that, they reasoned that the money they were saving in corporate taxes and licensing fees from all 50 states was significantly more than any monetary punishment they might receive.

After they made the loans, Countrywide never sold them to a securitized trust as they were required to do by the pooling agreements.  Instead, the loans were controlled by Bank of America (BOA).  As a result, BOA was collecting payments and foreclosing on loans despite the fact that it never owned or funded any of the actual loans.

In 2008 some good Samaritans tried to stop this scheme by registering the corporation “America’s Wholesale Lender, Inc a New York Corporation” (AWLI).  They brought it to the attention of the US District Court that BOA was foreclosing on loans that it didn’t own, and that the loans were made by a corporation that BOA held no interest in.  The District Court dismissed the case as irrelevant and BOA continued the fraud with a few upgrades.

After the creation of AWLI, Bank of America needed to find a way to make it so that AWLI could make no claims to the loans.  What they did was get MERS to create an assignment on behalf of AWLI which assigned the loan to Bank of New York Mellon, Deutsche Bank, or US Bank.  After these fraudulent assignments, the bank attaches them to their foreclosure proceedings to trick the court into believing it is the legal owner of the loan.

This is all made even more infuriating when you realize that all of these 3.5 MILLION fraudulent loans have been fully repaid by taxpayers in the TARP bailout and by the various insurance companies who insured the securitized trusts these loans were supposed to be a part of.

The bright side is that, if you have the right legal team on your side, these homeowners can get justice.

If you know of anyone with a loan from America’s Wholesale Lender, you need to get in contact with my office immediately at (706)-485-0162.  I have spent the last 19 months building up a team of experienced attorneys and fraud examiners/forensic auditors who specialize in exposing exactly this sort of fraud.

We have a huge opportunity to help homeowners and do some great deals with multiple exit strategies by exposing this unbelievable and blatant fraud.  We finally have the leverage we need to get the banks negotiating on our terms.  It doesn’t matter if the homeowner has already been foreclosed on, we might be able to help.

Bob MasseyBob Massey is a recovering corporate executive who is now living the dream running his own successful real estate investing business and teaching others how to do the same. In the process he has become the nation’s leading educator on the foreclosure investing process.

Contact Bob Massey

Bob Massey’s Other Articles >>

Comments

  1. larry anderson says:

    an audit states my HECM loan by Seattle Mortgage Co was also handled by Countrywide I have been fighting BAC since 2010 to save my home my phone is 707 277 9041

  2. Joe says:

    I have this type of loan exactly . I have tried many times to get in contact trying again once more.

  3. sheri clarry says:

    I just read and I’m dealing with SLS & BOA& they have (2x)(4/2010) foreclosed last one 8/4/14 & sold my house at auction 12/19/14 back to the SLS Real Estate Company …help I live in sarasota & do not want to leave my home-2 real estate letters have arrived recently (one 1/20/15-& one 12/23/14)and asking me to vacate…….9412280261

  4. Ron St Hill says:

    Wondering if a settlement was reach with homeowners and Country Wide/Americas Wholesale Lenders. As an investor here in New York Ive seen 100’s maybe thousands of morgages with Americas Wholesale Lenders.
    By the way Iam interested in purchasing forclosed properties in bulk in Queens,Brooklyn and Bronx.Any ideas !

    • GuyFawkes says:

      No. See Bank of America v. Linda Nash. It is an appellate level case out of Florida. The lower court held that AWL was not able to contract as they were not a corporation. The lower court’s decision is now being appealed by BofA.

      Hold onto your hats folks, because this is the biggest fraud perpetrated on the American populace. Not only this Countrywide boo-foo, but the entire securitization fraud.

  5. Gail Mohr says:

    I am currently fighting foreclosure pro se as I am a school bus driver and live day to day by the grace of God. My scenario lines us EXACTLY with your article.
    July 2006 – Signed note and made payments to Countrywide. Registered on tax records as “Americas Wholesale Lender”
    Sept, 1, 2008 – Last payment of mortgage paid. Couldn’t afford to pay anymore.
    Sept. 2009 – Tax records show mortgage is assigned to US BANK, Trustee with BAC as mortgage processor.
    9/23/2009 – US BANK files Lis Pendis
    2/28/13 – US BANK discharges Lis Pendis on their own stating it was “amicably settled” and “Lis Pendis null & void”
    Aug. 2013 – Mortgage assigned from America Wholesale to Nationstar
    11/26/14 – US BANK with Nationstar as processor files for foreclosure!

  6. R. Keith Davis says:

    I have this type of mortgage as well – problem is, they were never licensed in my state as a mortgage lender and neither was MERS, the so-called “nominee”, and AWL’s agent (MERS) cannot confer legal status upon AWL when it holds no state mortgage license either.
    BoA allegedly self-assigned the mortgage from AWL to themselves via a Miguel Romero, VP of MERS, and subsequently to Green Tree Servicing.
    If I’m reading correctly, according to the laws of my state, a “lender” in violation of NC GS governing mortgage loans must “…disgorge and pay to a borrower or other individual any amounts received by the licensee, individual, or person subject to the Article.”
    Llloks like another lawsuit brewing…

  7. C Luna says:

    I would like to discuss representation. I have a 2006 CWALT J5 Security loan originated by Americas Wholesale Lender a New York Corporation. My loan was never properly placed into the security and further the original substitution of trustee and substitution of mortgage were fraudulently signed. The substitution of trustee was also fraudulently signed and used on numerous occasions to file NOD and NOT status. I am facing another sale date and would like to determine my options.

  8. Shawn Newman says:

    Naming a non-existent entity (America’s Wholesale Lender, Inc.) as the lender on the mortgage destroys the unity of interest and renders the security worthless. Bank of America cannot foreclose without committing fraud. The indorsements and assignments are fraudulent and violate transfer warranties. Fannie or Freddie Mae funds the loan but does not own the mortgage. Fannie and Freddie presumably have a security interest in the loan but do not “perfect” that interest by possession or filing a financing statement with the state per UCC Art. 9. They leave possession of the putative loan with the servicer who forecloses. That assumes the original, physical loan still exists. According to the Florida Bankers Association, the SOP is to convert the physical original to electronic data (i.e. digitize), compile into portfolios which are transferred to the secondary market (i.e. via Fannie and Freddie), frequently as motgage-backed securities. “The physical document was deliberately eliminated to avoid confusion immediately upon its conversion to an electronic file.” See, State Street Bank & Trust Co. v. Lord, 851 So.2d 790 (Fla. 4th DCA 2003). The entire Florida Banker’s statement can be found at: In re Amendments to Rules of Civil Procedure and Forms for Use with Rules of Civil Procedure, Fla. Supreme Court No. 09-1460 (2009).

  9. Cyndi says:

    For those of you that have this loan, you need to countersue in the FEDERAL COURTS with the FDCPA. The lender takes you case to the STATE COURTS because the laws are NOT SET UP FOR THE CONSUMER! In Federal Court, ALL THE LAWS are set up for you! So, you go after them as a DEBT COLLECTOR if they allegedly assigned the loan in DEFAULT~and IF the original creditor/lender didnt have a license in your state, NO ONE CAN COLLECT because the loan is ILLEGAL. The FEDERAL COURTS will grant you $1000 fine for each penalty AND….they will stop the lender from being able to collect on the house! You will also get thousands and sometimes millions with damages as well. AND..If they have been calling you, especially cell phones, you can collect $500 for the first call and $1500 for every call afterwards! Look up FDCPA, FRCA, TCPA, OCC, UCC and then take your file, (put it together in order, turn them into the CFPB, OCC, FTC, State Justice Dept , your ATTORNEY GENERAL OFFICE and then be a whistleblower if in a TRUST, because they are reporting their income to the IRS as stock income, when illegal and so much more! ttp://www.whistleblowersagainstfraud.com/cftc-whistleblower-program

Leave a Reply