NOTICE TO ALL INVESTORS IN JPMAC2006-NC1 ATTENTION PENSION FUNDS!!

ACTION REQUIRED IF YOU DON’T WANT TO BE TAXED AT 100%
JPMAC2006-NC1 IS ALSO KNOWN AS J.P. MORGAN MORTGAGE ACQUISITION TRUST 2006-NC1, ASSET BACKED PASS-THROUGH CERTIFICATES, SERIES 2006NC1. THE MORTGAGE LOANS IN THIS SECURITIES TRUST WERE ORIGINATED BY HOME123 CORPORATION OR NEW CENTURY MORTGAGE CORPORATION (BOTH STILL IN BANKRUPTCY SINCE 4-2-2007). JPMAC2006-NC1 IS A REMIC PER THE TRUST DOCUMENTS AND FILINGS WITH THE IRS. IF EVERYTHING IS HUNKY DORY WITH THE REMIC THEN THERE IS SPECIAL TAX TREATMENT, BUT IF NOT---YOU, AS AN INVESTOR, CAN BE TAXED AT 100%.
REMICs are an acronym for Real Estate Mortgage Investment Conduits. When you’re talking about mortgage pools used in securitization, you’re talking about REMICs. And REMICs have special tax treatment; they are exempt from federal taxes provided they only invest in “qualified mortgages” and other permitted investments. Here’s the important part: under the 1986 Tax Reform Act, the REMIC must receive all of its assets in the trust within 90 days and the assets have to be performing (not in default). Any REMIC violations make the vehicle subject to a penalty tax of 100%, with additional penalties as they apply. REMICs 101. So, what is a REMIC? If properly formed and operated, the REMIC entity is not taxed on its earnings, since the investors, i.e. the bondholders, are “passive ” – that is, they have no control over the operations of the trust. Taxation occurs only at the investor level, upon distribution of the REMIC earnings. However, in order to comply with the strict IRS tax rules governing them, REMICs are limited in the type of investments they may hold. Generally, they consist of certain permitted investments and “qualified mortgages,” i.e. those that (a) are principally secured by interests in real property and (b) transferred into the REMIC within three months of its startup (or closing) date. With only certain exceptions, transfers of mortgages into

a REMIC after expiration of the three month period (usually defined as the “Cut-Off Date”) is a “prohibited transaction” and result in a tax being imposed upon the REMIC that is equal to 100 percent of the net income derived from the prohibited transaction. The Pooling and Servicing Agreement (“PSA”). The rules for the operation of a REMIC are contained in a voluminous document called a Pooling and Servicing Agreement, or “PSA.” The PSA addresses many issues, but some of the most important provisions define the duties and responsibilities of the major participants. You can find the PSA for JPMAC2006-NC1 on the SEC website. SEC = Securities and Exchange Commission. THE BIG PROBLEM: Many of the mortgages were not properly transferred into the REMIC trust by the cutoff date of the trust and as such are considered a ‘prohibited transaction.’ The IRS can tax you at 100% of the net income derived from the prohibited transaction plus possible penalties. SEE THE ATTACHED ASSIGNMENT: Here is a classic example…..this mortgage loan is in JPMAC2006-NC1 (supposedly) but look at the Assignment which is executed in May of 2007!! The closing date of the JPMAC2006-NC1 is in April of 2006. This means there was a half-hearted attempt to move the note and deed into the securities trust JPMAC2006-NC1 well over a year after that REMIC trust’s cutoff date. To compound matters, the assignment is not even assigned to the correct entity. It should not be assigned to U.S. Bank, N.A.---but it should be assigned to U.S. Bank N.A. as Trustee for JPMAC2006-NC1. IT ONLY TAKES A SINGLE BAD ASSIGNMENT TO CAUSE A ‘PROHIBITED TRANSACTION AND CAUSE THE 100% TAXATION OF INVESTORS. HERE IS WHAT YOU NEED TO DO ASAP: 1. CONTACT THE CEO OF CHASE, JAMIE DIMON AT JPMorgan Chase & Co. 270 Park Avenue New York, NY 10017 Phone: 212-270-6000 Fax: 212-270-1648 TELL HIM TO IMMEDIATELY CANCEL THE RECORDED ASSIGNMENT WHICH IS ATTACHED AND ALL OTHERS WHICH ARE LATE ASSIGNED TO THE REMIC TRUST. TELL HIM YOU DO NOT WANT TO BE TAXED AT 100% PLUS POSSIBLE PENALTIES DUE TO FRAUDULENT AND NEGLIGENT PAPER PROCESSING FOR THESE CHASE SECURITIES TRUSTS.

2.

CONTACT ERIC HOLDER AT THE DEPARTMENT OF JUSTICE

U.S. Department of Justice 950 Pennsylvania Avenue, NW Washington, DC 20530-0001 By Phone Department of Justice Main Switchboard - 202-514-2000

http://www.justice.gov/contact-us.html TELL ERIC HOLDER TO INVESTIGATE AND CRIMINALLY PROSECUTE CHASE FOR POTENTIALLY CAUSING THE IRS TO TAX YOU AT 100% TAX RATE PLUS POSSIBLE PENALTIES FOR THE REMIC VIOLATIONS DUE TO FRAUDULENT ASSIGNMENTS. THE ACTIONS BY CHASE ARE FRAUD. THE FRAUDULENT ASSIGNMENTS NEED TO BE CANCELLED INSTRUMENTS AT THEIR RESPECTIVE COUNTY RECORDER’S OFFICE.

CONSULT A TAX LAWYER

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