Most of the Foreclosures in Connecticut have been Assigned to Few Selected Legal Firms
Richard Blumenthal, the Attorney General is involved in a probe looking into the foreclosure problem in Connecticut. He has asked for information from Lender Processing Services, Fannie Mae and Freddie Mac about their selection of law firms for operating the processing works. Reports are being investigated by him that most of the foreclosures in Connecticut have been assigned to few selected legal firms. There are innumerable complaints from consumers that they failed to receive the proper notices regarding foreclosure steps.
Blumenthal said, “Dominance over foreclosure service by a few select law firms and marshals has spurred complaints about improper or illegal practices — wrongfully allocating work to non-marshals, forging papers, failing to serve papers, and making kickbacks”. He added that concentration of these operations only with few firms can lead to problems “causing unconscionable costs and failed notice delivery. These companies – mortgage lending giants – have a public trust”.
GMAC is reviewing its foreclosure documentation by the very firm that managed foreclosure processing Bradley Arant – a foreclosure mill. They contract out the work following a networked schedule. Freddie Mac and Fannie Mae and their servicers work with companies that operate in a manner that is highly standardized handling the massive volume of work. Blumenthal has no doubts that Fannie Mae and Freddie Mac would have to bear a great amount of responsibility for anything improper that has been done. The legal firm was not acting as independently as it usually does.
GMAC made use of the firm of David Stern. Thus Bradley Arant has the double purpose of deepening its ties with Fannie and to keep both itself as well as GMAC out of danger. For this Bradley Arant obviously has to narrow down the scope of its examinations and not to stir up any questions that will sprout further questions like whoever was giving out contracts at the original point might be culpable also. The names of LPS, Fannie could then be dragged in.
A broad look would be to find out who is really responsible. The foreclosure of loans that have been securitized is beginning to look like an environment that can be described as ‘criminogenic’ said Bill Black in which those involved are entwined together in their activities and interests. If they come under a cloud it is to the best interests of all cut off the weakest and most dispensable of all and keep tidy and clean their foreclosure mills.
