MERS Authority “as nominee”: Show Me the Nomination!

By Tim A. Bryant (March 2013)

Mortgage Electronic Registration Systems, Inc., as Nominee
The term “nominee”, as used in the MERS mortgage, is an indefinite reference. It is not defined
in the mortgage. No document is ever recorded in due course to which sets forth such
“nomination” terms. “.. Importantly, the MERS and the lender... purposely chose to use the
specific legal term “nominee,” and not “agent” or “powerofattorney.” MERS also chose not to
define the term “nominee.”,” Mortgage Electronic Registration Systems, Inc. (MERS) v.
Johnston, No. 420609 Rdcv, VT Sup Ct Rutland (2009). The relationship between the Lender and
Mortgage Electronic Registration Systems, Inc., must be therefore be derived from the mortgage,
MERS governing documents, and public statements made showing the intent of the parties.

I.

The MERS Mortgage
MERS Residential Marketing Kit (includes sample Mortgage & Deed of Trust)

https://mersinc.org/component/docman/doc_download/197mersresidentialmarketingkit201207se
cured?Itemid=
“MERS” is Mortgage Electronic Registration Systems, Inc. MERS is a separate
corporation that is acting solely as a nominee for Lender and Lender’s successors and assigns.
MERS is the mortgagee under this Security Instrument. MERS is organized and existing under
the laws of Delaware, and has an address and telephone number of P.O. Box 2026, Flint, MI
485012026, tel. (888) 679MERS.”
This language states that MERS is nominee, ad infinitum. They are bound to the mortgage as
nominee and mortgagee, even upon transfer or assignment.
The purpose and function of the nomination is stated in the “Transfer of Rights in the Property”;
“This Security Instrument secures to Lender: (i) the repayment of the Loan, and all
renewals, extensions and modifications of the Note; and (ii) the performance of Borrower’s
covenants and agreements under this Security Instrument and the Note. For this purpose,
Borrower does hereby mortgage, grant and convey to MERS (solely as nominee for Lender and
Lender’s successors and assigns) and to the successors and assigns of MERS, the following
described property....
TOGETHER WITH all the improvements now or hereafter erected on the property,... shall also be
covered by this Security Instrument. All of the foregoing is referred to in this Security Instrument
as the “Property.” Borrower understands and agrees that MERS holds only legal title to the
interests granted by Borrower in this Security Instrument, but, if necessary to comply with law
1
MERS Authority “as nominee”: Show Me the Nomination!

for the Lender and all future interests. but not limited to. -Only if necessary to comply with law or custom [restrictive endorsement]. MERS System Membership Rules (June 2009) We will now review the membership rules to search for their definition of nominee. Terms and Conditions) https://mersinc. indicates that MERS acts as nominee. in “this security instrument” (includes all riders). but not limited to. to MERS. releasing and canceling this Security Instrument. -As “legal title” holder of the mortgage. as the “person entitled to enforce”. and. Rule 2. -And nominal assignee of the note. including. 2 MERS Authority “as nominee”: Show Me the Nomination! . II. -And nominal assignee of the note. -While requiring the borrower to secure MERS. -Simultaneously. -And “equitable title” holder of the mortgage. -To which it holds the Security Instrument in MERS name. or trustee. -Without attachment of the Lender’s security interest under UCC Article 9. which would support a legal conveyance. To “only” hold the “legal title” to. and the note. assignee.org/component/docman/doc_download/197mersresidentialmarketingkit201207se cured?Itemid= 1. the right to foreclose and sell the Property. Without any consideration given by MERS. Section 5(a) states. as the holder of the “equity of redemption”. For the purpose of simultaneously securing (in the present) the Lender and all future interests in the mortgage and note. 3. and to take any action required of Lender including. accommodating party. 4.” The language of the mortgage on its face. -And holds the title to the collateral in MERS name. the “interests granted by Borrower”.or custom. 2. -Without perfection of the Lender’s security interest under UCC Article 9. MERS (as nominee for Lender and Lender’s successors and assigns) has the right: to exercise any or all of those interests. They chose the term “nominee”.  System Governing Documents The MERS MERS Residential Marketing Kit (includes Membership Rules. MERS is not acting in the capacity of an accommodation party. which is a position chosen by nomination. of interests in real property. To “exercise” any and all of “those interests”.

Inc. conspired. No lender has ever filed a “d/b/a Mortgage Electronic Registration Systems. The Member hereby warrants to MERS that either (i) an appropriate mortgage. As soon as practicable. The mortgage recorded in the country recorder’s office is obsolete. the Member shall promptly correct the information on the MERS System. Inc. MERS is demanding the member to act in the capacity of “Mortgage Electronic Registration Systems. there is no nominee status given or defined. “As long as there are no contrary instructions. who are not parties to the mortgage or the note. to appear in the appropriate public records as the mortgagee of record with respect to each mortgage loan that the Member registers on the MERS® System. and any employee. for any and all liability incurred as a result of compliance by MERS with instructions given by such Member on behalf of the nonMember beneficial owner. at its own expense. naming Mortgage Electronic Registration Systems. Such Member shall indemnify and hold harmless MERS. The “legal title” to the collateral is embezzled by MERS for it’s own use.“Each Member. shall at all times comply with the instructions of the Member shown on the MERS® System as the servicer of such mortgage loan with respect to transactions relating to such mortgage loan. MERS acts “solely as” an agent of the servicer. through undeniable. MERS is the principal.. The Member shall monitor the public records to verify that it has complied with the preceding sentence and shall maintain an adequate quality assurance program to ensure that its verification procedures are effective. but MERS and its members. retain it as a false document of title. and the member is MERS’ agent. Section 4(b) states. This rule also evidences that MERS had no intention of abiding by the applicable law stated in the 3 MERS Authority “as nominee”: Show Me the Nomination! . as mortgagee. the Member shall register on the MERS® System the specific recordation information provided by the custodian of public records which evidences that Mortgage Electronic Registration Systems. Rule 2. when the beneficial ownership of a mortgage loan registered on the MERS® System is vested in a nonMember. properly prepared and delivered to the appropriate recording office and the Member shall promptly register on the MERS® System the date on which such instrument was delivered. or assignment of deed of trust. It’s “nominee” status has terminated. officer or affiliate of MERS. or (ii) an appropriate assignment of mortgage. or other such instrument as may be required under applicable state law. Inc. yet MERS fraudulently converts and conceals it’s status under the mortgage. or deed of trust. director. shall cause Mortgage Electronic Registration Systems. naming Mortgage Electronic Registration Systems. is mortgagee of record with respect to such mortgage loan.” In this rule. nor has any lender ever provided a Power of Attorney from MERS to contract on their behalf. as mortgagee..” In this rule. criminal acts. Inc. as mortgagee”. Upon the Member’s becoming aware of any discrepancy between the information shown on the MERS® System and the information in the public records. Inc.” with their Corporate Certificate. and the use of it’s members. Inc. has been or as soon as practicable shall be. or other such instrument as may be required under applicable state law. Mortgage Electronic Registration Systems. Inc. when MERS no longer has any agency with the Lender. Inc. MERS and Mortgage Electronic Registration Systems. is a wholly owned subsidiary of MERS created for the purpose of serving as the mortgagee of record in the appropriate public records.

and applicable Procedures (collectively. It is glaringly apparent that “Nominee” in not included in the language. selected by such Member. “Upon request from the Member. is shown to be registered to the Member. Mortgage Electronic Registration Systems.mortgage. MERSCORP Holdings. liability and expenses which they may sustain as a result of any and all actions taken by such certifying officer. as a party with a right to receive payment under it. directors. to permit such Member (i) to release the lien of any mortgage loan registered on the MERS® System to such Member. It can also act to protect the interests of a member.” In this rule. Inc. Inc. officers. (vi) to take action and execute all documents necessary to refinance. amend or modify any mortgage loan registered on the MERS® System to such Member. as “certifying officers” of Mortgage Electronic Registration Systems. Inc. and the Member shall abide by these Terms and Conditions (“T&C”). Inc. and Membership Rules were required to be incorporated into the mortgage. (iv) to take any and all actions necessary to protect the interest of the Member or the beneficial owner of a mortgage loan in any bankruptcy proceeding regarding a loan registered on the MERS® System that is shown to be registered to the Member. such Member shall indemnify MERS and any of its employees. Rule 3. agents or affiliates against all loss. The MERS System Terms and Conditions. in accordance with the Procedures. the “Governing Documents”). The Terms & Conditions. shall promptly furnish to the Member. they neglect to include the Terms & Conditions associated with those rules. MERS can act as an assignee of the note. The MERS System Terms and Conditions While MERS and MERSCORP have offered the MERSSystem Membership Rules as evidence of their nominee status (which is there is none). a corporate resolution designating one or more officers of such Member. This is the extent of MERS authority under the Membership Rules. Inc. or if the mortgage is registered on the MERS® System. (vii) endorse checks made payable to MERS to the Member that are received by the Member in payment on any mortgage loan registered on the MERS® System that is shown to be registered to the Member. the “Companies”) . copies of 4 MERS Authority “as nominee”: Show Me the Nomination! . (“MERSCORP Holdings”) and Mortgage Electronic Registration Systems. designates an officer of a Member as a certifying officer of MERS for the limited purposes described above. instead of the beneficial owner. the MERS® System Rules of Membership (the “Rules”). (ii) assign the lien of any mortgage naming MERS as the mortgagee when the Member is also the current promissory noteholder. In instances where Mortgage Electronic Registration Systems. “1. as well as the MERS Membership Rules are contained in the MERS Residential Marketing Kit. (“MERS”) (collectively. (v) to take such actions as may be necessary to fulfill such Member’s servicing obligations to the beneficial owner of such mortgage loans (including mortgage loans that are removed from the MERS® System as a result of the transfer thereof to a nonMember). 2. (iii) to foreclose upon the property securing any mortgage loan registered on the MERS® System to such Member. Section 3(a) states.

Inc. cause MERS to appear in the appropriate public records as the mortgagee of record with respect to each mortgage loan that the Member registers on the MERS® System (each. MERS has no right to the “legal title” of the mortgaged property. References herein to “mortgage(s)” and “mortgagee of record” shall include deed(s) of trust and beneficiary under a deed of trust and any other form of security instrument under applicable state law. in an administrative capacity. Inc. or to any mortgaged properties securing MERS Loans. (“MERSCORP”). III. shall promptly. This means that MERS did not have capacity to contract with the borrower. The Member shall be bound by any amendment to any of the Governing Documents. or as soon as practicable. for the beneficial owner or owners thereof from time to time. The Member. plural). to any servicing rights related to MERS Loans. “from time to time”. as “Electronic Agent”.org/component/docman/doc_download/194etaware housetemplatev6secured?Itemid= Gestation ETA template https://mersinc. MERSCORP Holdings. in the status of “MERS”.which will be supplied upon request. a “MERS Loan”) . It is 5 MERS Authority “as nominee”: Show Me the Nomination! . More importantly. MERS agrees not to assert any rights (other than rights specified in the Governing Documents) with respect to MERS Loans or mortgaged properties. and obtained the title due to Larceny by Fraudulent Inducement. The Governing Documents shall be a part of the terms and conditions of every transaction that the Member may make or have with the Companies or the MERS® System either directly or through a third party.” We now discover that MERS nomination is only in an administrative capacity. MERS ELECTRONIC TRACKING AGREEMENTS Whole Loan ETA template https://mersinc. MERS shall serve as mortgagee of record with respect to all MERS Loans solely as a nominee.” Clause 2 is the first reference we find to MERS as nominee. at its own expense.org/component/docman/doc_download/195etawhol eloantemplatev6secured?Itemid= Warehouse ETA template https://mersinc. “2. and has no authority to assert any rights (including the mortgage). The ETAs are the true contracts to which are entered into between multiple entities as principles. Inc. MERS shall have no rights whatsoever to any payments made on account of MERS Loans. and Mortgage Electronic Registration Systems.org/component/docman/doc_download/193etagesta tiontemplatev6msecured?Itemid= One only needs to review the “MERS” Electronic Tracking Agreement (“ETA”) to discover that Mortgage Electronic Registration Systems. was never granted any “nominal” rights by its alleged principles (yes.

as nominee for the Borrower.” .” . (“Electronic Agent”). as applicable. (“MERS”) and... (“MERS”) and. but the Servicer...(this “Agreement”) among.(“Seller”). ““Mortgage Loan” shall mean each mortgage loan included in a Mortgage Pool. in each case secured by a Mortgage. Mortgage Electronic Registration Systems.(Whole Loan ETA & Gestation ETA) Continuing on in the ETA.” .(Gestation ETA) ““Mortgage Loan” shall mean each mortgage loan included in a Mortgage Pool. It does not nominate them as nominee or mortgagee. with respect to the pledged Mortgage Loans in accordance with the MERS Procedures Manual and (b) it has designated or will promptly designate itself as the servicer or subservicer in the MERS® System for each such pledged 6 MERS Authority “as nominee”: Show Me the Nomination! ..” . (this “Agreement”) among. Inc. “THIS ELECTRONIC TRACKING AGREEMENT dated as of . and has taken or will take such action as is necessary to cause MERS to be. Mortgage Electronic Registration Systems.. the mortgagee of record. (“Purchaser”).. “WHEREAS.(Whole Loan ETA) ““Mortgage Loan” shall mean each mortgage loan that is pledged by Borrower to Lender.(“Borrower”). The definition of “mortgage loan” under the ETA states.(Warehouse Lending ETA) “THIS ELECTRONIC TRACKING AGREEMENT dated as of..paramount to recognize that they are not designated as “Nominee”. (“Electronic Agent”). MERSCORP Holdings. it states. Inc. for “certain Mortgage Loans”. The ETAs. the Lender and the Borrower desire to have certain Mortgage Loans registered on the MERS® System (defined below) such that the mortgagee of record under each Mortgage (defined below) shall be identified as MERS” The black-letter language of this clause nominates MERS to be the “mortgagee of record under each mortgage”.” . MERSCORP Holdings. “The Borrower represents and warrants that (a) it has designated or shall designate MERS as. “registered on the MERS System”.. The problem with this clause is that MERS is not the nominee for the Lender.(Warehouse ETA) The ETA language would then make sense. Inc. in the actual mortgage registered in the county recorder’s office. Inc. do not define “mortgagee of record” which would clarify the language. but do not want the notes registered in MERS name.. or insured by a private mortgage insurer.. in each case secured by a Mortgage on a one to fourfamily residence and (if so required by the relevant Agency Program) eligible to be either guaranteed by VA and/or insured by FHA. (“Lender”). The parties want the mortgages registered on the MERS(TM) System in the name of “MERS”.... unlike the Membership Rules. Section 3 of the ETA (“Designation of MERS as Mortgagee of Record”) is the only place where you will find MERS designated as nominee.

is that the Seller may be designated as investor. 7 MERS Authority “as nominee”: Show Me the Nomination! . The Whole Loan ETA does not even mention nominee status.. and in accordance with the MERS Procedures Manual.. This granting of “mortgagee of record”. Just recording on the MERS System... There is no other conclusion to be made when the following ETA provisions are read.. the Seller has designated or shall designate the Seller as the servicer or subservicer in the MERS® System for each such Mortgage Loan (each such Mortgage Loan. the Seller has designated or shall designate the Seller as the [investor/servicer] or subservicer in the MERS® System for each such Mortgage Loan (each such Mortgage Loan..” . (u) not pledge its assets for the benefit of any other person or entity. “7. servicer.” . and has designated or will promptly designate the Lender as the interim funder on the MERS® System with respect to each MERS Designated Mortgage Loan. as appropriate.(Warehouse ETA) As you can see. the servicer is the party involved. a “MERS Designated Mortgage Loan”)... must be the sole nominee authority. MERS shall.. and the Whole Loan ETA. upon such designation by MERS. No Adverse Interest of the Electronic Agent or MERS.(Whole Loan ETA) The last sentence states that the designation of MERS as “mortgage of record”.” “MERS agrees that in no event shall MERS’ status as mortgagee of record with respect to any MERS Designated Mortgage Loan confer upon MERS any rights or obligations as an owner of any MERS Designated Mortgage Loan or the servicing rights related thereto. and in accordance with the MERS Procedures Manual. and MERS will not exercise such rights unless directed to do so by the Purchaser. a “MERS Designated Mortgage Loan”). is the process by which the mortgage loan becomes a “MERS Designated Mortgage Loan”.. or subservicer.” . The Gestation ETA is slightly different. Apparently. (r) not make loans to any other person or entity or buy or hold evidence of indebtedness issued by any other person or entity (except for cash and investmentgrade securities). Once again. there is no mention of public recording. “The Seller has designated or shall designate MERS as. members or shareholders. only in the MERS System.(q) not acquire the obligations or securities of its affiliates or owners.” “9.(Gestation ETA) The only variance between this ETA. the mortgagee of record with respect to each Mortgage Loan in a Mortgage Pool. this is a process for perfection within the MERS System.Mortgage Loan (each pledged Mortgage Loan. and the Seller as “servicer or subservicer”. and has taken or will take such action as is necessary to cause MERS to be. Again. including partners. “The Seller has designated or shall designate MERS as... MERS is not the nominee for the true Lender who funded the loan. upon such designation by MERS. the mortgagee of record with respect to each Mortgage Loan in a Mortgage Pool. so designated is a “MERS Designated Mortgage Loan”). Covenants of MERS. and has taken or will take such action as is necessary to cause MERS to be.

servicers.By execution of this Agreement. They had no capacity to issue a mortgage as an agent of the Lender. MERS. Inc. hypothecate. and (B) transacting any and all lawful business for which a corporation may be organized under the laws of the State of Delaware that is incident. no adverse interest.com/doc/111072092/1999MERSDelArticlesofIncorporationWithCertif ications We turn our attention to the corporate charter of Mortgage Electronic Registration Systems. Nothing herein contained shall be deemed or construed to create a partnership. The word “nominee” is absent. and neither the Electronic Agent nor MERS shall pledge. and other interested parties in connection with the origination.” Mortgage Electronic Registration Systems. purchase. financing and/or securitization of. Article Third (a restricted article) of the MERS AOI states. and during the existence of this Agreement shall hold. the Electronic Agent and MERS shall have no power or authority to act as agent for the Purchaser or the Seller pursuant to any grant of authority made under or pursuant to this Agreement. sale. filed with every state secretary’s office in which they do business. the Electronic Agent and MERS each represents and warrants that it currently holds. they also agreed never to assert any such rights. owners. IV. ARTICLES OF INCORPORATION http://www. nor hold any right. By contract. necessary and appropriate to accomplish the foregoing. lien or right to setoff by the Electronic Agent. as stated in the mortgage. by way of security or otherwise. was void ab initio. and the conveyance of title.” Here we see that MERS is only to acting as mortgage of record.” “25. with a borrower. or interest in the mortgaged property. pledge. or any third party claiming through the Electronic Agent or MERS. rehypothecation. The charter. Other than the obligations of the Electronic Agent and MERS expressly set forth herein. or otherwise grant any third party interest in. Status of Electronic Agent. “The purpose for which the organization is organized is limited solely to (A) acting as mortgagee of record on behalf of originators. title. trustees. dispose of. 8 MERS Authority “as nominee”: Show Me the Nomination! . to MERS. joint venture between the parties hereto and the services of the Electronic Agent and MERS shall be rendered as independent contractors for the Purchaser and the Seller.scribd. As such. subservicers. with “on behalf of” being the effective language. The functions of every corporation are stated in their Articles of Incorporation. transfer. the mortgage. the MERS Designated Mortgage Loans. investors. in any MERS Designated Mortgage Loan. or similar transactions involving mortgage loans and similar interests in real estate. has no nominal authority to contract on behalf of any party. The MERS Designated Mortgage Loans shall not be subject to any security interest. Inc. encumber.

Here is what was given by MERS “to 9 MERS Authority “as nominee”: Show Me the Nomination! .” Taking Article Eighth into consideration of MERS “nominee” status. or it’s members.” “(l) Not acquire the obligations or securities of its affiliates or owners.uspto.A. or otherwise dispose of the real estate. liquidate.” “( c ) Not commingle it’s assets with those of any other person or entity and hold all of it’s assets in it’s own name. SECURITY AGREEMENT.. There are a few other functions that are noticeably absent from the stated purposes. What it does show. clause (c). It does not state that they are an intermediary for MERSCORP. 4) It cannot make a loan to a borrower. 3) It does not states that it can act as a “certifying authority” for it’s members to act as MERS agents. BETWEEN MORTGAGE ELECTRONIC REGISTRATION SYSTEMS. members or shareholders. V. especially under those terms. 2) Cannot hold legal title. states that they are limited to only that function. with capacity to contract with borrowers. which it proclaims in the mortgage. Article Eighth (a restricted article) provides more restrictions on MERS. as being a “restricted Article.pdf This agreement was for a secured line-of-credit for MERS.. I have yet to discover any such amendment. foreclose. and 6) It cannot pledge the “legal title” it claims to hold for the benefit of another party.. Such amendment would have to be filed with the Delaware Secretary of State. Eighth cannot be amended.” “(p) Not pledge it’s assets for the benefit of any other person or entity. the MERS System.” “(m) Not make loans to any other person or entity or buy or hold evidence of indebtedness issued by any other person or entity (except for cash and investment-grade securities). 2) It also does not state that it can act as attorney-in-fact for these parties. http://assignments. the MERS System. DATED JUNE 30. 1) it must keep it’s own records. AND NATIONSBANK. 1998. Under Article Seventh. including partners. a MERS mortgage is ultra vires. we see that. while the Lender holds equitable title. INC. and not those of MERSCORP. in the same instrument. and any other state which they do business.gov/assignments/assignmenttm17730949. “The Corporation shall. 3) It cannot acquire any interest in the notes or the mortgages of it’s members. 1) It does not state that MERS can own. “(a) Maintain books and records separate from any other person or entity. 5) It cannot hold the mortgage bonds of it’s members.however. is that MERS is definitely not acting “solely as nominee for Lender”. as appropriate. N. It had no authority or capacity to enter into it..” “(f) Observe all corporate formalities.. Reviewing Article Eighth. unless authorized by the MERS Board of Directors. or “members”. transfer.

in accordance with the terms thereof and to secure the due and punctual performance of all the obligations of the Borrower contained in the Credit Agreement.. (vi) to the extent not included in the foregoing. instrument or 10 MERS Authority “as nominee”: Show Me the Nomination! . Other Intangibles.. securities and liens held for the payment of any such account. contract rights. to and under the following. and all guaranties. document. data processing software. documents. master files and related property and rights (including computer and peripheral equipment) necessary or helpful in enforcing. including.” The definitions of Receivables.. whether now existing or hereafter acquired (all of which are herein collectively called the “Collateral”): (i) all Receivables. whether existing on the date hereof or arising hereafter. ledgers and records and all computer programs. “Section 2.. and interest in. punch cards. howsoever created. in the agreement. ““Receivables” means all accounts now or hereafter owing to the Borrower. whether tangible or intangible.Borrower hereby grants to the bank a security interest in all of the Borrower’s right. as. and (vii) to the extent not otherwise included. title. now or hereafter existing or due or to become due. arising or evidenced. (ii) all Other Intangibles. instruments or chattel paper representing amounts payable and monies due or to become due to the Borrower. all other personal property. (iii) all Equipment. and all accounts receivable. (iv) all Inventory. the balance of every deposit account now or hereafter existing of the Borrower with any bank and all monies of the Borrower and all rights to payment of money of the Borrower. all books. (v) to the extent not included in the foregoing. transaction files. but not limited to.induce the Bank to enter into the Credit Agreement and to secure its obligations thereunder and hereunder”. contract right. and wherever located. identifying or establishing any item of collateral. account receivable. tapes. all Proceeds and products of any or all of the foregoing. arising from the sale of Inventory or the rendition of services in the ordinary course of business or otherwise (whether or not earned by performance). whether direct or indirect. absolute or contingent. together with all Inventory returned by or reclaimed from customers wherever such Inventory is located. and Inventory are defined. discs.1 Grant of Security Interests To secure the due and punctual payment of all Obligations.

by any other agreement or contract. In furtherance of the foregoing. demand. Upon the request of the Bank at any time upon the occurrence of a Default. all purchase orders now owned or hereafter received or acquired by it for goods or services and (iv) all rights of the Borrower as an unpaid seller. federal and state tax refunds. The Borrower will use all reasonable efforts to cause each account debtor to comply with the foregoing instruction. It has continuing liability. permits. instruments. This is never disclosed as part of the mortgage loan. to which you did not expressly agree to in writing. Trademarks. The security interest in the mortgage would attach to NationsBank. wherever located. “(b) The Borrower is authorized to collect amounts owing to it with respect to the Collateral. notify Account Debtors obligated to make payments under any or all Receivables or Other Intangibles that the Bank has a security interest in such Collateral and that payments shall be made directly to the Bank. By this contract. MERS cannot waive it’s liability to NationsBank. notes. accounts receivable. (ii) all inventory. work in process or materials used and consumed or to be used and consumed in the Borrower’s business. for their personal gain and unjust enrichment. to secure NationsBank (now Bank of America) for MERS’ own line of credit. to and under. in the name of the Borrower or it’s own name or otherwise. They are securing their creditor. every borrower has an equitable interest in the monies given to MERS.3. drafts. and not the Lender or MERS. (iii) all of the Borrower’s rights in.” ““Other Intangibles” means all accounts. the Bank may at any time. under Section 2.” ““Inventory means” all inventory now owned or hereafter acquired by the Borrower. all customer lists. including recission. warehouse receipts and bills of lading. Licenses. (ii) to take possession of. copyright and other rights in intellectual property. This is Fraudulent Conversion (embezzlement) and Larceny by Fraudulent Inducement.” What makes this more egregious is that NationsBank makes itself a party in interest to the note and mortgage. This is an illegal transaction. other than Receivables. collect. chattel paper. the Borrower will so notify such account debtors. upon the occurrence of a Default. evidenced by negotiable and non-negotiable documents of title. receive and give acquittances and receipts for any and all amounts due and to become due under any Collateral and.” MERS grants a security interest in the legal title to your property. Patents. and a violation of RESPA and TILA. endorse and collect any checks. including (I) all goods and other personal property which are held for sale or lease or are furnished or are to be furnished under a contract for service or which constitute raw materials . MERS is not securing the Lender. and “shall do nothing to impair the security interests herein granted.chattel paper. with your collateral.2 of the agreement. reversionary interests in pension plan assets. money and general intangibles now owned or hereafter acquired by the Borrower including. without limitation. acceptances or other instruments for the payment of moneys due under any Collateral and (iii) to file any claim or take any other action in any court of law or equity or otherwise which it may deem appropriate for the purpose of collecting 11 MERS Authority “as nominee”: Show Me the Nomination! . They are also converting your collateral. reclamation and stopping in transit. contract rights. replevin. the Borrower authorizes the Bank (i) to ask for. However. documents. Under Section 2.

Consents” states that creation of the security interests is (i) within MERS corporate power. “MERS” is a registered trademark owned by MERSCORP. it appears to bind the current MERS. to NationsBank. present. (iv) do not violate any law. MERS never endorsed the note or was granted any right. (ii) duly authorized by the Board of Directors and shareholders.) Since MERS granted security interests in any mortgage past.” Defined Term = ““Account Debtor” means. is that this MERS merged with and into. MERS also authorized NationsBank to make demands upon mortgagors. not the mortgagor). including without limitation any account debtor thereon. It also has granted rights to NationsBank to declare default (of MERS. The Bank shall have no obligation to obtain or record any information relating to the source of such funds or the obligation in respect of which payments have been made. would appear less damning upon the current MERS.2 “Title to Collateral”. and to sue or foreclose upon mortgagors. Each agreement. and became MERSCORP. Section 4. NationsBank is also authorized to take possession of the mortgage and deed. (iii) are not against MERS’ Articles of Incorporation. and (vii) does not require the consent of any other person. (Remember. other than (possibly) “(ii)”. MERS has “sold” it’s rights stated in the underlying mortgages.1 “Validity of Security Agreement. with respect to any Receivable or Other Intangible. states. in the name of MERS. having good and marketable title thereto. for MERS’ default under their security agreement. While this. “Except for the security interests granted to the Bank pursuant to this Security Agreement. at first. assumed. identity. even if the mortgagor was not in default! Section 3. Inc. Needless to say.any amounts due under any Collateral. on January 1. 12 MERS Authority “as nominee”: Show Me the Nomination! . as well as MERSCORP. (v) do not conflict with any other agreements (including mortgages & deeds of trust) which MERs is a party or bound. for credit.. This includes business under any trade. (vi) do not create a lien upon any MERS property other than in the name of NationsBank. or interest in it.” The rest of the agreement is just as nefarious as the aforementioned Sections. except Permitted Liens. 1999. Section 3. to which the mortgagors are unaware they are liable for MERS’ default. This means that MERS has granted an equitable interest IN THE NOTE and mortgage to NationsBank. or structure. as well. are illusory promises.3 of the NationsBank Security Agreement requires it to be amended to preserve it’s security interests upon any MERS corporate change in name. It is frankly. has bound you to be liable under their Security Agreement. The caveat. title. too appalling to continue stating each section ad nauseum. Inc. Inc. or future. or fictitious name. without your knowledge. and direct the mortgagors to make payments to the bank. free and clear of any and all Liens.” MERS. the Borrower is the sole owner of each item of the Collateral. there are a few items that tend to reflect that this contract is bound to them. with which they illegally used your property deed as collateral. any Person obligated to make payment thereunder.

“Q. Is the new company was the new company in any way bound by any acts of the prior company? 13 MERS Authority “as nominee”: Show Me the Nomination! . in a deposition on April 7. the name of that corporation was Mortgage Electronic Registration Systems. are the statements made by MERS Secretary.The other evidence supporting this conclusion. was binding on the new corporation incorporated on incorporated effective January 1. William C. F1020908. Inc. Hultman then states that he current MERS assumed obligations of the old MERS. did anything the prior corporation did bind the new corporation when it came into existence effective January 1. 2010. BROCHIN: Object to the form of the question. The subsidiary is a single purpose corporation that was incorporated for the sole purpose of holding title to the mortgage. And I'm sorry. The corporation that was incorporated at 1999 is a wholly owned subsidiary of Merscorp.” A. Sup. Inc. 1998 and the company that was incorporated in Delaware on December 30. Q. Q. “Q. What is the relationship between the earlier company that had a meeting of the board on April 9. the subsidiary assumed all of the authority relating to holding title to the mortgage that the original corporation had. the operation of the registry and the other operational issues associated with the MERS process. Other than assuming something to do with the mortgage the original corporation had. I'm not sure what's meant by the authority relating to the holding of a mortgage. in Bank of New York. Inc. 1999? A. as Trustee for the Certificate Holders CWABS. there was a predecessor corporation which was a membership corporation which also had the name Mortgage Electronic Registration Systems. 1998. Prior to 1999. While being deposed. Most of the again. maybe you can explain that a little bit. And can you tell us if anything the predecessor board did on April 9. THE WITNESS: Basically. Asset-Backed Certificates. and prior to that. 1999? A. the authority that related to holding title to the mortgage was adopted by the new corporation.” Continuing. Victor and Enoabasi Ukpe. Hultman. DOCKET NO. “Q. Ct. 1998. with an effective date of incorporation of January 1. The other operations of the old corporation remained with the parent corporation. Inc. 1999? MR. Hultman made the following statements. NJ Atlantic County. Series 2005-AB3 v.

nor did they have the authority to enter into the contract with the borrower. Kesler. BROCHIN: Object to the form of the question. Bank v. or interest they claimed under the mortgage. as it relates to “nominee”. 2009). The court reporter couldn't hear your answer. THE WITNESS: Only to the extent that they assumed those resolutions. Which obligations were assumed by the new subsidiary corporation? A. I don't have them in front of me and I didn't look As the Kansas Supreme Court noted. The subsidiary corporation assumed some of the obligations of the parent Q. 14 MERS Authority “as nominee”: Show Me the Nomination! at them . What is clear is that MERS never had any of the right. MERS. “Q. 164 (Kan. 216 P. A. MALONE: Can you tell us which resolutions the new company. title. To the extent that we Q. BY MR.A.3d 158. “defined the word in much the same way that the blind men of Indian legend described an elephant – their description depended on which part they were touching at any given time. There's a whole series of them. The ones that related to holding title to mortgages or acts as mortgagee or benefici Continuing. Specifically. Q.” Landmark Nat. the company that came into A. was the new corporation in any way bound by resolutions passed by the old corporation? MR.

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