You are on page 1of 106

Defendants

1
CIVIL COMPLAINT FOR MORTGAGE FRAUD, VIOLATION OF THE
FEDERAL HOME OWNERSHIP & EQUITY PROTECTION ACT, VIOLATION
OF THE FEDERAL TRUTH IN LENDING ACT, VIOLATIONS OF THE
RESPECTIVE STATES‟ PREDATORY LENDING LAWS, AND VIOLATION OF
SECTION 1 AND SECTION 4 OF THE 14TH AMENDMENT OF THE
CONSTITUTION OF THE UNITED STATES OF AMERICA
ht

CIVIL CHARGES
tp

1. Paul L. Muckle, pro se, the plaintiff in the above entitled action, respectfully
://

files this complaint against the named defendants, accusing them jointly and
th
e

severally of violating the follows laws:
re

a. Section 1 of the 14th Amendment of the United States Constitution.
C olu
al

O

b. Section 4 of the 14th Amendment of the United States Constitution.
re

PY tio
v

c. The Federal Home Ownership and Equity Protection Act of 1994, as

amended, HOEPA. 15 U.S.C. ss. 1639, 12 C.F.R. ss.ss. 226.32 and 226.34

d. The Arkansas Home Loan Protection Act, Ark. Code Ann. ss.ss. High Cost
na

Home Loan 23-53-101 et seq.
rie

e. The Cleveland Heights, OH Ordinance No. 72-2003 (PSH), Mun. Code ss.ss.
s.

757.01 et Covered Loan seq.
ni

f. The Colorado Consumer Equity Protection, Colo. Stat. Ann. ss.ss. Covered
ng

Loan 5-3.5-101 et seq.
.c
o

g. The Connecticut Abusive Home Loan Lending Practices Act, High Cost
m

Home Loan Conn. Gen. Stat. ss.ss. 36a-746 et seq.

h. The District of Columbia Home Loan Protection Act, D.C. Code ss.ss. 26-

1151.01 et seq. Covered Loan

2
i. The Florida Fair Lending Act, Fla. Stat. Ann. ss.ss. 494.0078 et seq. High

Cost Home Loan

j. The Georgia Fair Lending Act, Ga. Code Ann. ss.ss. 7-6A-1 et seq. High

Cost Home Loan 6, 2003) et seq. Georgia as amended (Mar. 7, Georgia

Fair Lending Act, Ga. Code Ann. ss.ss. 7-6A-1 et seq. High Cost Home
ht

Loan 2003 - current)
tp
://

k. The Illinois High Risk Home Loan Act, Ill. Comp. Stat. tit. 815, High Risk
th

Home Loan ss.ss. 137/5 et seq.
e

l. The Indiana Home Loan Practices Act, Ind. Code Ann. ss.ss. High Cost
re

C olu
al

Home Loan. 24-9-1-1 et seq.
O
re

m. The Kansas Consumer Credit Code, Kan. Stat. Ann. ss.ss. 16a-1-101 High
PY tio
v

Loan to Value Consumer Loan (id. et seq. ss. 16a-3-207), and Sections 16a-

1-301 and 16a-3-207 became effective High APR Consumer Loan (id. ss.

Section 16a-3-308a became effective 16a-3-308a)
na

n. The Kentucky 2003 KY H.B. 287 - High Cost Home Loan Act, Ky. Rev.
rie

High Cost Home Loan Stat. ss.ss. 360.100 et seq.
s.

o. The Maine Truth in Lending, Me. Rev. Stat. tit. 9-A, ss.ss. 8-101. High Rate
ni
ng

High Fee Mortgage et seq.
.c

p. The Massachusetts Part 40 and Part 32, 209 C.M.R. ss.ss. 32.00 et seq. and
o

High Cost Home Loan 209 C.M.R. ss.ss. 40.01 et seq. Massachusetts
m

Predatory Home Loan Practices Act High Cost Home Mortgage Loan

Mass. Gen. Laws ch. 183C, ss.ss. 1 et seq.

3
q. The Nevada Assembly Bill No. 284, Nev. Rev. Stat. ss.ss. 598D.010 Home

Loan et seq.

r. The New Jersey New Jersey Home Ownership Security Act of 2002, N.J.

High Cost Home Loan. Rev. Stat. ss.ss. 46:10B-22 et seq.

s. The New Mexico Home Loan Protection Act, N.M. Rev. Stat. ss.ss.
ht

High Cost Home Loan 58-21A-1 et seq.
tp
://

t. The New York N.Y. Banking Law Article 6-l, High Cost Home Loan
th

u. The North Carolina Restrictions and Limitations on High Cost Home High
e

Cost Home Loan Loans, N.C. Gen. Stat. ss.ss. 24-1.1E et seq.
re

C olu
al

v. The Ohio H.B. 386 (codified in various sections of the Ohio Covered Loan
O
re

Code), Ohio Rev. Code Ann. ss.ss. 1349.25 et seq.
PY tio
v

w. The Oklahoma Consumer Credit Code (codified in various sections

Subsection 10 Mortgage of Title 14A)

x. The South Carolina South Carolina High Cost and Consumer Home Loans
na

High Cost Home Loan Act, S.C. Code Ann. ss.ss. 37-23-10 et seq.
rie

y. The West Virginia Residential Mortgage Lender, Broker West Virginia
s.

Mortgage Loan Act Loan and Servicer Act, W. Va. Code Ann. ss.ss. 31-17-1
ni
ng

et seq.
.c
o

2. The complaint also accuses the defendants of:
m

a. Failure to protect the residents in each respective state and of every state

in the Union from unlawful dispossession and financial rip-off.

4
b. Aiding and abetting in the dispossession of the residents of each respective

state.

c. Failure to protect the national and financial security of the people of the

United States of America.
ht

DEMANDS
tp
://

3. This complaint does not seek monetary damages.
th

4. The complaint seeks “CEASE AND DESIST ORDERS” against all the
e

defendants, jointly and severally, to:
re

C olu
al

a. Cease and desist from granting any foreclosure ORDER that violates the
O
re

“Due Process” clause of the 14th Amendment of the United States
PY tio
v

Constitution.

b. Cease and desist from violating the “Equal Protect” clause of the 14th

Amendment of the United States Constitution.
na

c. Cease and desist from granting any foreclosure ORDERS that, under the
rie

federal HOEPA and each respective state‟s predatory lending laws are,
s.

“unconscionable and void.”
ni
ng

d. Cease and Desist from violating Section 4 of the 14th Amendment by paying
.c

the debt, through federal bailouts, of foreign and domestic investment
o

firms which were responsible for the fraud that‟s destroying the United
m

States‟ economy.

5
e. The complaint states in no uncertain terms that all subprime loans in the

country with adjustable rate interest have “Fraud in the Factum” in the

origination of the promissory note. Therefore, under the Uniform

Commercial Code Section 3-305, all such notes are null and void.

f. The complaint seeks that after seeing the evidence, the Court must move to
ht

confiscate the deeds to an estimated 10 million subprime home mortgages
tp
://

in the entire United States of America from the foreign note owners and to
th

transfer said deeds to the care and protection of the United States
e

Treasury.
re

C olu
al

g. The complaint also seeks that the Court order the United States Treasury
O
re

to take immediate steps to go after all financial institutions which were
PY tio
v

actively involved in the gross mortgage and securities fraud that‟s

wreaking havoc on the livelihood of the people, and the firms which got

taxpayer‟s bailout money, and to demand that the bailout money they
na

received be returned to the Treasury of the United States, forthwith, or
rie

face confiscation also.
s.
ni
ng

STATUTORY PROVISIONS
.c

5. The plaintiff respectfully files this complaint on the grounds of Sovereign
o

Citizenship.
m

6. All persons born or naturalized in the United States and subject to the

jurisdiction thereof are citizens of the United States and of the state wherein

6
they reside. The plaintiff is a legal derivative- citizen of the United States of

America and a resident of the state of Massachusetts.

7. Sovereign Citizenship is the birthright of all Americans, who in turn extended

this most important right to foreign-born persons through naturalization laws.

With this status, my unalienable rights of life, liberty and property couldn't be
ht

infringed upon nor could they be transferred or sold by any other person.
tp
://

8. The plaintiff‟s claims of sovereign citizenship, which is a right vested in him by
th

the United States Declaration of Independence to life, liberty, and the pursuit
e

of happiness, is absolute.
re

C olu
al

9. Each individual, at least so far as respects his unalienable rights, is his own
O
re

sovereign, which means that wherever the rights of the people as a whole are
PY tio
v

being abridged, then any citizen is free to pursue claims on behalf of himself

and the collective citizens of his state and of every state in the Union, in any

federal court of law, against any enemy or entity, whether foreign or domestic,
na

jointly and severally, to redress the violation of any law or the enforcement of
rie

any law which directly threatens his sovereign rights; whether that violation
s.

occurs in his respective state and/or in any other state in the Union. So long as
ni
ng

it affects me as a sovereign, I have a right to sue.
.c

10. “The word "sovereign" is defined in the sixth edition of Black's Law Dictionary,
o m

published in 1990, as being "A person, body, or state in which independent

authority is vested; a chief ruler with supreme power; a king or other ruler in a

monarchy.” Prior to the War for American Independence, the British king was

7
the sovereign and the American people were his subjects. The war's outcome

changed all this; let us not go back down that road.

11. The sovereignty has been transferred from one man to the collective body of

the people, and he who before was a subject of the king is now a citizen of the

State. State v. Manuel, North Carolina, Vol. 20, Page 121 (1838)
ht

12. Thus, a citizen of a state is, by the federal Constitution, made a citizen of the
tp
://

United States. This means the following: A citizen of one state is to be
th

considered as a citizen of every other state in the Union. Butler v. Farnsworth,
e

Federal Cases, Vol. 4, Page 902 (1821)
re

C olu
al

13. Therefore, if any citizen of any state has evidence that any entity, whether
O
re

foreign or domestic, is engaged in any adverse action which abridges the rights
PY tio
v

of the people, or that causes destruction to our nation‟s economy, then that

citizen, as a sovereign, has the constitutional right and the patriotic duty to his

country to intervene to stop it; whether through an act of war or through a
na

court of law.
rie

14. For purpose of elimination (because I know this will be the first line of defense
s.

for the court and the defendants), the Federal Court, Local Rule 83.5.3 (c),
ni
ng

which states that a non attorney cannot act as the lawyer for anyone but
.c

himself, is a direct violation of my 14th Amendment rights. Let us explore this
o

concept by focusing on “what are considered as being the rights inherent in
m

citizenship in America: When men entered into a state, they yielded a part of

their absolute rights, or natural liberty, for political or civil liberty, which is no

8
other than natural liberty restrained by human laws, so far as is necessary and

expedient for the general advantage of the public.” What this is clearly stating

is that unless the action that I am taking adversely impacts or infringes upon

the sovereign rights of another citizen in the Union, or unless my actions

adversely threatens the public interest, then no court in the land has the right
ht

to deny my claim on the grounds of a local rule.
tp
://

15. Federal Local Rule 83.5.3 (c) is a direct infringement of my constitutional right
th

and duty to defend my country and my fellow citizens from a “clear and present
e

danger” to our financial stability and to our national security.
re

C olu
al

16. My absolute sovereign rights to defend my country and my people in a federal
O
re

court of law is an advantage, not a disadvantage, to the public, nor does it
PY tio
v

infringe on the rights of any other citizens if the citizens are being grossly

harmed by the action for which I, as a sovereign citizen, seek to redress.

17. In America it is unlawful to kill, but if I had information that a group of
na

terrorists, whether foreign or domestic, were plotting to harm the people, or to
rie

bring harm to the government of the United States of America, and I was to
s.

kill those terrorists, would they not pin labels on my shoulder and parade me
ni
ng

across the airwaves? So then why is it that if I perform the same act,
.c

nonviolently, but in a civil action in a court of law, why do they say I have no
o

standing to do so, and that I cannot defend anyone else?
m

18. This lawsuit does not seek monetary damages nor does the plaintiff require

any compensation for any service rendered in this lawsuit. A license for the

9
right to practice law is an agreement to share the loot, e.g., “Collective Security

for Surety.” For what will they tax me if I loot no man? So then why do I need a

license to defend? This lawsuit simply seeks a CEASE AND DESIST ORDER

against thievery and dispossession, and to seek the protection of our national

security, and to protect the integrity of the overall U.S. economy. The
ht

defendants should be my co-plaintiffs.
tp
://

19. It is for the benefit of all the people that I, as a sovereign citizen, wage this
th

civil war against the foreign investment firms destroying our economy and
e

threatening our national security from within.
re

C olu
al

20. For two years now, I have been trying to bring what I know to the attention of
O
re

the appropriate authorizes, but the authorities have been derelict in their duty
PY tio
v

to the people; therefore, under the U.S. Constitution, if the government ceases

to function effectively on behalf of the citizens, then I as a sovereign citizen

have a patriotic duty to my country to wage war against any enemy of the
na

people, whether that enemy be foreign or domestic.
rie

21. You may consider this civil action an act of war on behalf of me and of all the
s.

people. Because the government won‟t go after the financial terrorists who are
ni
ng

terrorizing the people and destroying our country from within, then I must sue
.c

the government to force them into action. Therefore, this action against the
o

government is not an act of malfeasance, but rather a war of attrition (what I
m

call my Jericho Wall Strategy). If the royals won‟t come down from off the

10
mountain, then I as a sovereign have no problem going up there to fetch them

down.

22. We are a nation of laws. Any action to dismiss this complaint on the grounds of

any Local Rule is an abridgement of my sovereign rights to liberty. Any

enforcement of any Local Rule 83.5.3 (c) in this instant case is a violation of the
ht

14th Amendment which states, “No State shall make or enforce any law which
tp
://

shall abridge the privileges or immunities of citizens of the United States of
th

America.” The federal government is NOT excluded, or immune from this
e

provision of the Constitution. Just thought that I would save myself the two
re

C olu
al

trips to the Appellate Courts.
O
re

PY tio

COMPLAINT
v

23. Between the year 2006, to the present year 2009, more than three million

American families throughout all 50 states in the Union, have lost their homes
na

through a foreclosure epidemic caused my mortgage and securities fraud
rie

perpetrated by foreign and domestic investments firms on Wall Street.
s.

24. The above named defendants have all admitted that because of mortgage fraud
ni
ng

perpetrated by investment bankers on Wall Street and the home mortgage
.c

industry, they are expecting many more (at least another seven million or so)
o

American Family homes to be lost to foreclosure.
m

25. However, despite this foreknowledge, the defendants as protectors of their

people, have failed to take the appropriate action in stopping this unlawful

11
dispossession and robbery of the people, but has instead engaged in acts which

not only aid and abet the perpetrators, but which violate the 14th Amendment

to the Constitutional of the United States of America and the federal and

states‟ Predatory Lending Acts as mentioned in paragraph one of this

complaint.
ht

26. Under the terms of each individual mortgage contract originated in all 50
tp
://

states in the United States of America within the last 5 years, the drafter of
th

the contract (the mortgage lender) has inserted a provision which states words
e

to this effect: „In the case of default on the mortgage terms, if the citizen does
re

C olu
al

not cure the default within the prescribed time, the lender may use the
O
re

applicable law to foreclose on the consumer‟s property and sell it, without
PY tio
v

further notice to consumer.‟

27. Under this clause in the mortgage contract, American mortgage note holders,

doing the tasks of their foreign bosses on Wall Street, are permitted by state
na

law to walk into an American Court of Law (such as the housing court), and
rie

file an ex parte complaint to obtain, without any objection and/or knowing and
s.

intelligent assent thereof, “legal rights” to enter into, and to take possession of
ni
ng

property, and to evict that America citizen out into the street like a dog, and to
.c

sell his/her property without first granting that citizen his/her constitutional
o

rights to due process; these due process rights being the rights to contest the
m

validity and/or fairness of the dispossession.

12
28. Under the terms of the mortgage contract, the consumer has no legal rights to

contest the foreclosure of his/her property in the very same proceeding as the

lender is allowed to go and argue for the rights to dispossess.

29. This complaint states, not alleges, that all four million-plus foreclosure orders

which have been issued in any ex parte hearing in any American court of law
ht

throughout any of the 50 states within the past five years, are all unlawful and
tp
://

violate the due process rights of the citizens who are directly affected by said
th

foreclosures.
e

30. Under federal consumer protection ordinance, each individual state must enact
re

C olu
al

anti-predatory lending laws which must exceed or conform to the federal Home
O
re

Ownership & Equity Protection Act (HOEPA) unless that state chooses to
PY tio
v

adopt the federal standards.

31. The federal Home Ownership and Equity Protection Act was enacted to fight

predatory lending and equity stealing by unscrupulous lenders. One of the
na

issues that the HOEPA dealt with was the slick way in which lenders were
rie

able to use the system to legally cheat unsuspecting homeowners out of their
s.

homes.
ni
ng

32. Under Regulation Z of HOEPA and each individual state‟s anti-predatory
.c

lending laws, one of the practices that falls within the definition of predatory
o

lending happens when a lender hides words in the fine print that make it
m

illegal for the homeowner to take legal action against the lender. The

borrowers sign away their rights to sue the lender for any fraud, predatory

13
actions or illegal actions. The only right the borrowers have is to take their

grievances to arbitration. The arbitration process is totally in the hands of the

lenders, usually conducted in secret without the borrowers having adequate

representation. Although the borrowers can usually have legal counsel, they

find it difficult to find anyone who will represent them because the lawyers are
ht

not guaranteed payment of their fees in arbitration like they are in court.
tp
://

Many arbitration cases are handled over the phone and when a small
th

individual is pitted against a large corporation and the proceedings are
e

confidential with no stenographic or written record of the facts, the borrower is
re

C olu
al

at a true disadvantage. Most arbitration decisions are binding and the
O
re

borrowers cannot appeal them.
PY tio
v

33. Each individual state‟s predatory lending law which is modeled after the

federal HOEPA, specifically using the language of the Massachusetts General

Laws 183C §13, states, “Without regard to whether a borrower is acting
na

individually or on behalf of others similarly situated, any provision of a high
rie

cost home mortgage loan that allows a party to require a borrower to assert
s.

any claim or defense in a forum that is less convenient, more costly, or more
ni
ng

dilatory for the resolution of a dispute than a judicial forum established in the
.c

commonwealth where the borrower may otherwise properly bring a claim or
o

defense or limits in any way any claim or defense the borrower may have is
m

unconscionable and void.”

14
34. Section 1 of the 14th Amendment to the U.S. Constitution states, “No State

shall make or enforce any law which shall abridge the privileges or immunities

of citizens of the United States; nor shall any State deprive any person of life,

liberty, or property, without due process of law; nor deny to any person within

its jurisdiction the equal protection of the law.”
ht

35. However, despite this forbiddance by the United States Constitution and the
tp
://

federal and state predatory lending laws, lenders are still permitted to deprive
th

the people of their pursuit of liberty and property. Let‟s analyze the situation:
e

The law already recognized that arbitration strips consumers of their rights, in
re

C olu
al

fact this is how the law puts it: (a) “The arbitration process is totally in the
O
re

hands of the lenders, (b) usually conducted in secret without the borrowers
PY tio
v

having adequate representation. (c) Proceedings are confidential. (d) Most

arbitration decisions are binding and the borrowers cannot appeal them.

36. Now, with those recognitions by the government in mind, how is a foreign note
na

holder allowed to walk into an American court of law, by themselves, without
rie

any notice to the citizen, and seek an American court order from an American
s.

judge empowered by an American state governor, for the dispossession of a
ni
ng

citizen?
.c

37. Am I the only one who sees that the lenders got slicker and bolder? Instead of
o

forcing the citizen into arbitration to contest the foreclosure, the lender
m

eliminated the whole process altogether. Instead of granting the citizen the

right to dispute the validity of the foreclosure, the lender just goes straight to a

15
court of law, and demands that the American judge give them the legal rights

to dispossess the people, without the people being able to tell their side of the

story. The only time the citizen knows that they are being deprived of their

property and their rights to due process, is when they receive their copy of that

American court order granting legal rights to dispossession. By then it is
ht

already too late; the one-sided legal order has already been issued, the matter
tp
://

has already been recorded in the County‟s Registry of Deeds, and the notice of
th

sale has already been placed in the local newspaper. The only thing that‟s left
e

is for prospective buyers to come and begin the Great Humiliation. What a
re

C olu
al

calamity! There is no appellate process, except that the citizen now has to hire
O
re

an attorney and file a separate suit which in the end would be even more costly
PY tio
v

than arbitration.

38. What attorney will take a case where the foreclose order has already been

issued? And on what grounds would he sue? Wasn‟t the Dispossession Order
na

issued by a court of law established in the commonwealth or state, by that
rie

state‟s government? Had I not been too ignorant to accept defeat, I too would
s.

have been amongst the victims of this Great Disrespect.
ni
ng

39. But to add insult to injury, the foreclosure ORDERS that are signed by the
.c

Chief Justice of the housing court states, “If you are entitled to the benefits of
o

the Servicemembers Civil Relief Act as amended and you object to such
m

foreclosure you or your attorney should file a written appearance and answer

16
in said court …or you may be forever barred from claiming that said

foreclosure is invalid under said act.” (See Exhibit A.)

40. So right there, in plain English, if the homeowner is not a member of the

military on active duty, then that homeowner is not entitled to contest the

validity of the foreclosure. This is a blatant violation of the „equal protection‟
ht

clause of the 14th Amendment.
tp
://
th
e re

C olu
al

O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

17
o m
.c
ng
ni
s.
rie
na
PY tio

18
O
C olu
v
re
al
ere
th
://
Exhibit A

tp
ht
41. There are parallels between what the lenders did before the predatory lending acts were

enacted, and what they are doing after those laws were enacted, and they got even bolder.

They eliminated the citizen‟s rights to contest the foreclosure altogether and just walk into

court boldly, without notice, and demand legal rights to deprive a citizen of their most

sacred rights to property without due process.
ht

42. The people aren‟t even allowed to assert any defense because according to the ORDER
tp

written by the court and signed by the American judge, they have no such rights unless they
://
th

are entitled to the Servicemenbers Civil Relief Act.
e

43. The rights to foreclose order granted by the court which allow only military
re

servicemen the right to contest the validity of a foreclosure is a blatant
C olu
al

O
re

violation of the „equal protection‟ clause of the 14th Amendment.
PY tio
v

44. Should I keep back my opinion at such a time, through fear of giving offense or

on the penalties of death? No; I should consider myself guilty of treason

towards the people, and an act of disloyalty to the Majesty of Heaven who I
na

revere above all earthy kings.
rie

45. Didn‟t most of the defendants oppose the war for which the Servicemembers
s.

Civil Relief Act was amended? What is the difference between the soldier
ni

fighting in a war far away from the home front, the policeman fighting crime in
ng

our streets, the carpenter beautifying his neighborhood, or the garbage
.c
o

collector keeping our cities sanitary? Aren‟t we all serving the United States of
m

America? Am I the only who saw the trick? While our attention was focused on

the warfront over there, they snuck their Trojan horse in through the back

door over here. Isn‟t that the true concept of open warfare? You distract the

19
enemy by keeping him focused on other things while you sneak in the back

door and destroy the civilians within. It‟s not about the soldiers; war has never

been, nor will it ever be about fighting the soldiers. A soldier will pick up arms

in a heartbeat to defend the family, but kill the family and the soldier will lay

down his arms. I mean, what more does he have to fight for? Ever since 9/11,
ht

the goal has been to destroy the American family. Which country can bring
tp
://

America to its knees militarily? But you destroy the family base, and America
th

would crumble like a deck of cards. We got drawn into a false war which no one
e

can ever win. But the real war was never about bombs and bullets; it was
re

C olu
al

always about destroying the family and enslaving them through economics.
O
re

Dead people can‟t spend money. The World Trade Center? Two times? It is all
PY tio
v

about trade. While we‟re on fool‟s errands overseas, the family is being

destroyed at home. These subprime loans are the ultimate Trojan Horse. The

war was all one big distraction; all part of the big scheme. Even the bailouts
na

were planned.
rie

46. Which American note holder got to keep the billions of bailout money they got?
s.
ni

Let‟s tell the people the truth as to who really got the money. The American
ng

banks were not losing money because they were not funding the loans. The
.c

foreign investment firms were funding the loans; the American banks would
o m

originate the loans then transfer the title over to the foreign investor.

Therefore, it is the foreign investor who suffers the loss, and so when they give

bailouts the American banks hand the taxpayers‟ money right over to their

20
foreign bosses, and in return for treason, these CEOs are awarded their thirty

pieces of silver which they like to call bonuses. If these banks are losing so

many billions of dollars, how is it that they are still able to pay out such huge

bonuses? It is because they are not suffering any losses; the mortgages are secured

and bonded and it was not their investment to begin with.
ht

47. If you cannot test an enemy militarily, you use greed to bring them down economically.
tp
://

Whose money has funded these subprime loans, and who holds the deeds to our properties?
th

Whose money has financed America‟s woes? It is not ours; the war made us broke,
e

remember?
re

48. That tactic reminds me of the Civil War; while the rebels went away to fight, they left their
C olu
al

O
re

families behind unprotected. Didn‟t Savannah and all of Georgia burn as a result? And
PY tio
v

now, while they are distracted „over there,‟ the real terrorists are in our backyard stealing

our property. What can be more terrifying than losing one‟s family home? They did not

even have to fire a single shot or release a suitcase bomb. All they did was to march onto
na

Wall Street, pin blinders on the mules and hold out a carrot on a stick. Those greedy CEOs
rie

followed that carrot to the precipice of, not theirs, but our own doom, then threw us over.
s.

49. How much longer must the people lay down in the mud so others can safely cross over?
ni

How much longer must the people trod on the winepress of Capitalism? They're going to
ng

rebel! A great man once lamented, “Those who don‟t learn from history are bound to repeat
.c

it!”
o m

50. And this brings to mind a previous case I filed on this very same matter in Paul L. Muckle,

et. al., verses Fremont Investment & Loans, et. al. Civil action number 07-11437. In that

case, I filed a motion for injunctive relief asking the court to issue a preliminary injunction

21
blocking all foreclosures in the country. The Court denied my motion. In his Memorandum

and Order, the court ruled, “Moreover, the Court cannot enter an injunction without first

providing the defendants an opportunity to respond because Muckle has not certified his

efforts to give notice to the defendants of his emergency relief or explain why such notice

should not be required.” To justify his ruling, the Court, appropriately following court‟s
ht

protocol, relied on the federal Rules of Civil Procedure 65 (a) (1), (b) On Friday, April 10,
tp

2009, I again went into the federal court to apprise the court of some very damaging
://
th

evidence of financial terrorism against our country, and the court told me that by law he is
e

not permitted to even look at the evidence without first giving the defense the liberty of a
re

response. And he was right; that is the law. The Honorable One was following the
C olu
al

O

Constitution that tells us no state shall make or enforce any law which shall
re

PY tio
v

abridge the privileges or immunities of citizens of the United States. Then he

honorably granted them their „equal protection‟ rights. However, in state court, the

representatives of Capitalism (the representatives of those foreign investment firms on Wall
na

Street) get the liberty of the right to due process, but the American people just get dumped
rie

on. What a tragedy! But I mean no disrespect.
s.

51. Am I the only one who sees the gross disrespect and the dump on the Constitutional rights
ni

of the American people? This is a people robbed and plundered! What were these housing
ng

court judges thinking of by granting ex parte hearings for dispossession without granting
.c

citizens their due process rights to a respond? Didn‟t the lender have to file a complaint for
o m

foreclosure? The fact that I was allowed to discover the matter before the next 6 million

orders go out is sweet to the mouth, but the enormity of the situation, the fact that three to

four million hardworking Americans have already lost their home due to this gross

22
violation of the U.S Constitution is bitter to the stomach. The people are in immense

danger! Over 10 million foreclosure notices expected; more than four million have already

gone out, and no one so much as even bat an eye to the fact that all those foreclosure

ORDERS violated the people‟s 14th Amendment rights. No one paid any attention. Wall

Street was not the only one drinking the punch of “reckless exuberance.”
ht

52. And to add insult to injury, the predatory lending laws in each respective state, state “Any
tp

provision of a high cost home mortgage loan that allows a party to require a borrower to
://
th

assert any claim or defense in a forum that is less convenient, more costly, or more dilatory
e

for the resolution of a dispute than a judicial forum established in the commonwealth where
re

the borrower may otherwise properly bring a claim or defense or limits in any way
C olu
al

O

any claim or defense the borrower may have is unconscionable and void.”
re

PY tio
v

53. According to the state and federal predatory lending act, all 4 million or so

COURT issued foreclosure orders that have been signed throughout the entire

United States of America, are “unconscionable and void” because it does not
na

even allow the homeowner the right to contest the foreclosure. So why are
rie

lenders still allowed to enforce them and why are American sheriffs pulling up
s.

to the homes of Americans residents with “unconscionable” and “void” eviction
ni

orders, forcing American residents out into the streets, packing up their
ng

belongings and, either placing them on the sidewalk, or putting them in
.c
o

storage that had already been “reserved”.
m

54. I have never been to law school, and I have no training in law, so maybe I‟m

misinterpreting the laws. Is this gross abuse and great disrespect a figment of

my imagination?

23
55. Because all 4 million plus court issued foreclosure ORDERS that were issued in the last

years are unconscionable and void, it means that every American family who has lost their

home to foreclosure on those ORDERS have been illegally deprived of their property and

denied their due process rights under the 14th Amendment of the Constitution.

56. It is not so much that the enforcement of the rights to foreclosure violates the
ht

people‟s rights, but rather that the lender has to seek a legal ORDER in an
tp

American Court of Law before he can enforce those rights to foreclose, that is
://
th

where the Constitutional violation comes in, because American lawmakers
e

have made, and the American courts of law are enforcing laws, abridging the
re

C olu

due process rights of the people to challenge the validity of the foreign entities
al

O
re

assertion of said legal rights to deprive of property, without due process. How
PY tio
v

can anyone presiding in a court of law not recognize the violations here? I

mean, am I misinterpreting the laws, or am I just too dumb to realize that no

one cares about what I think?
na

57. But it does not even end on this issue; it gets worse. Have any of the
rie

defendants asked themselves why is it that a subprime loan has an interest
s.

rate that increases 6 percent from the starting rate? If anyone in the
ni
ng

government knew the reason but kept silent, then that‟s treason.

58. Under the federal Regulation Z and the states‟ predatory lending laws, a “high
.c
o

cost home mortgage loan” is defined as a home loan where the origination fees
m

paid to third parties exceed a certain threshold set by law. Under Regulation Z,

it was eight percent (later changed to five percent). Under the federal

Consumer Protection Act, all states must have predatory lending laws that

24
conform to the federal standards; no state is allowed to set a higher threshold

than the federal‟s, however, some are exempted, and allowed to supersede the

federal law and set a lower threshold. Of the fifty states, only five sought

exemption to depart from the weaker federal law and enacted tougher laws to

protect their citizens. Massachusetts, which has the toughest predatory law in
ht

the land, is one of five states exempted and was allowed to supersede the
tp
://

federal law and set its threshold lower to five percent, making it harder for
th

lenders to rob consumers. Furthermore, where federal law only covered
e

refinanced loans, Massachusetts law covered any home loans. Massachusetts
re

C olu
al

really cared about its citizens when it enacted those tough laws in 2004.
O
re

59. Massachusetts then turned around and dropped the ball in 2005, and failed to
PY tio
v

pick it back up in 2006. Should I keep silent for fear of giving offense? The

truth is an offense, but I commit no sin against my brother. In fact, I am my

two brother‟s keeper. You know the saying, “If one of us crashes the bus, they
na

will accuse all of us of not knowing how to drive.” No one paid any attention
rie

when I whispered in private so do not be mad at me for calling you out in
s.

public.
ni
ng

60. Under federal and state predatory lending laws, a high cost home mortgage
.c

loan is normally an unlawful loan. However, it can be a lawful loan if the
o

lender meets certain requirements. If the origination fees of the loan exceed
m

the threshold set by law, the lender is required to send the consumer to

counseling so that the consumer may fully understand the terms of the high

25
cost loan. All subprime loans in the nation where the interest rate is to be

adjusted more than 5 percent constitute an unlawful high cost home mortgage

loan. In this type of situation, by decree of federal and state lending laws, the

lender must then send the consumer to counseling and get a letter of

certification from the non-profit counselor stating that at the time of the
ht

closing of the loan, the consumer “fully understands the features of the
tp
://

mortgage loan.” Under that same law, if the lender cannot produce said
th

certificate certifying that the consumer fully understands the terms of the high
e

cost mortgage contract, then the terms of the contract are unenforceable. They
re

C olu
al

are null and void. This means, under the TILA, if the lender cannot produce
O
re

said certificate, then the lender cannot foreclose, nor can he collect any
PY tio
v

mortgage payment under those same terms.

61. But how can a citizen know if the origination fees have exceeded the 5%

threshold, because the lender will undoubtedly hide the fact? Well, the answer
na

is simple; it is in your very face: if any resident has an adjustable rate
rie

mortgage loan with a teaser rate, and the interest is to be adjusted at least 5%
s.

from the starting rate, then the loan is an unlawful high cost home mortgage
ni
ng

loan. All subprime loans have an adjustable rate interest that will adjust to
.c

6%. That 6% is added to the loan at origination and is to be adjusted by 3% in
o

two years and 1.5% every six months thereafter. That 6% represents an
m

additional 6% in fees which the thieves have stolen from the equity of the

peoples‟ property than added on to the loan without the knowledge of the

26
borrower. That 6% represents hidden fees above and beyond the 4% or so that

the borrower may be aware of, therefore most borrowers are charged at least

10% in origination fees, which is twice the amount allowed by law.

62. But how have the lenders done this and how have they been able to pull the

wool over our eyes? It‟s simple. They stole it and hid their crime in plain sight.
ht

It all begins with the appraisal. For instant, on my adjustable rate mortgage
tp
://

loan, I borrowed $263,920; my starting interest rate is 8.690 % to be adjusted
th

6% more, for an interest rate cap of 14.690%. Somehow I knew that that 6%
e

represented fraud, but I could not prove it until I demanded copies of my loan
re

C olu
al

origination documents and got the proof. In those documents, I discovered a
O
re

fact that made my stomach churn: The lenders were taking out secret loans, up
PY tio
v

to more than 6% of the loan amount from the equity in people‟s property. They

did it to everybody.

63. This is how it was done: After the loan is originated, the lender has to transfer
na

the loan to their bosses (the foreign investment firms on Wall Street). But
rie

before the loan is to be traded on the world market, it has to be securitized and
s.

bonded which means it has to have private mortgage insurance, bonded under
ni
ng

a financial guaranty insurance policy, Bankruptcy Bond, letter of credit, and
.c

monitoring. Now it takes up to 6% of the loan amount to do all this, but
o

neither Wall Street nor the lender wants to foot the bill for this, so they charge
m

it to the borrower‟s account. Now, the premium for private mortgage insurance

is so high that if you added the premium to the other legally charged fees, it

27
would carry the fees over the 5% threshold. In this situation, the lender would

not be able to sell the loan because it would be unlawful, so they came up with

an “in-your-face‟ solution; they decided to steal the money and hide the fee.

64. After the lender got the appraisal report on the property, they would send the

appraisal to “Review.” Now, the word “Review” would seem normal in real
ht

estate transactions because the lender has to make sure that the appraisal
tp
://

value was supported. But this was not the case in these subprime loans
th

because it was not normal business practice to give an adjustable rate loan to
e

anyone making under $10,000 a month after taxes. I typed “Review Appraisal”
re

C olu
al

on the Internet and up popped a comment in which a former real estate
O
re

mortgage broker stated, “Lenders had forced brokers to pressure appraisers
PY tio
v

into reviewing appraisals to increase the value even if it was done

fraudulently. If they did not cooperate, then they would not get any business.”

So I set out to prove this, and I did. I found the proof in the lender‟s
na

underwriting policy.
rie
s.

For SG Mortgage Assets Back Securities. Series 2006 Fre-2 and 2006-OPT-2
ni

Underwriting Policies
ng

The level of review by the Affiliated Seller, if any, will vary depending on several factors. The depositor or
the Affiliated Seller will typically arrange for a review of a sample of the mortgage loans for conformity
.c

with the applicable underwriting standards and to assess the likelihood of repayment of the mortgage loan
from the various sources for such repayment, including the mortgagor, the mortgaged property, and primary
o

mortgage insurance, if any. Such underwriting reviews will generally not be conducted with respect to any
m

individual mortgage pool related to a series of securities. Such review, with respect to seasoned mortgage
loans or mortgage loans that have been outstanding for more than 12 months, may also take into
consideration the mortgagor‟s actual payment history in assessing a mortgagor‟s current ability to make
payments on the mortgage loan. In addition, procedures may be conducted to assess the current value of
the mortgaged properties. Those procedures may consist of drive-by appraisals, automated valuations
and/or real estate broker’s price opinions. The depositor or the Affiliated Seller may also consider a
specific area’s housing value trends. These alternative valuation methods may not be as reliable as the
type of mortgagor financial information or appraisals that are typically obtained at origination.

28
In certain instances, the LTV ratio or CLTV ratio may have been based on the appraised value as indicated
on a review appraisal conducted by the mortgage collateral seller or originator.

65. The appraisal value of my property was only the total loan amount of

$329,900. I have an 80/20 subprime loan. Twenty percent, or $65,980, went to

the piggy-back loan which means the lender can only consider the 80% or

$263,920 value to which this loan corresponds. The lender could not steal
ht
tp

anything out of the property, so what they did was send the appraisal to
://

review. The reviewer would inflate the appraisal value based on a real estate
th

broker‟s price opinions, and up to 6% above and beyond the loan amount would be
e re

added. The lender would then steal that phantom 6% equity from the property
C olu
al

and turn it into cash. This cash is then used to securitized the loan and pay for
O
re

PY tio

private mortgage insurance. This very same 6% theft is then credited to the
v

consumer‟s account. The only thing is that the consumer does not have to pay it

right away since it would raise too many eyebrows, so the robbery is delayed
na

for two years.

66. That is why we have adjustable rate mortgages that adjust 6% above the
rie

starting interest rate. I will prove it. Exhibit B, “Lender‟s closing
s.
ni

contingencies,” is a page of my loan documents. On line number 5, it clearly
ng

states, “MAX SLR CREDIT 6%.” Line number 8 at the very bottom of the
.c

document, it again states, “Seller credit not to exceed 6% or closing cost.”
o m

Now, to anyone, “Seller” would seem to refer to the seller of the home giving

the buyer up to 6% to help pay for closing costs, but what seller would give up

6% of his money to a buyer? Furthermore, we already know that the closing

29
cost cannot exceed 5%, so the 6% to which the interest rate would be adjusted

should have been the dead giveaway to the regulators had they been doing

their job. The “Seller” referred to here is not the seller of the property, but the

“Seller” on Wall Street; the one who funds the loans and who is responsible for

securitizing them for sale on the world‟s market. The investment firm is the
ht

“Seller.”
tp
://
th
e re

C olu
al

O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

30
o m
.c
ng
ni
s.
rie
na
PY tio

31
O
C olu
v
re
al
ere
th
://
Exhibit B
tp
ht
67. So there we have in plain English, the originator granting the 6% credit to the

Seller on Wall Street, for the “Seller” to use to securitize the loan. There is

more proof on the next document.
ht

68. On line 5 at the very bottom of the next document, the “MAX SLR CREDIT
tp

6%” is again mentioned as a closing condition.
://

69. At the very top, line 1, it tells of the appraisal being sent to review and states,
th

“GAP Review Appraisal, Approved by lender, To support a value of $329,920.”
e re

Now a question that can be raised here is, if the appraisal is already picked
C olu
al

O

and approved by the lender, why does it need to be “reviewed” again?
re

PY tio

70. Line 10 of this document states, “n/a SEE ATTACHED APPRAISAL
v

CONDITIONS.” Now I am no rocket scientist, but if I see this phrase in a

document and the actual document it refers to is also attached, I would
na

interpret that to mean that it is not the document itself that is “n/a” (not
rie

applicable), because it is attached. Rather it is „the conditions‟ that are stated
s.

on the document that are not applicable. To me, this is clearly stating that the
ni

$329,900 is not applicable; they had to increase the value. This looks like
ng

mortgage fraud. (See Exhibit C.)
.c
o m

32
o m
.c
ng
ni
s.
rie
na
PY tio

33
O
C olu
v
re
al
ere
th
Exhibit C
://
tp
ht
71. Now to prove that the appraisal was inflated and that the “n/a” referred to on

line 10 of the preceding document was meant to throw us off, I introduce the

actual document that line 10 refers to. It states, “NO CONDITIONS OF

REVIEW APPRAISAL.” Now the fact that I was charged $300 for the original

appraisal and another $300 for the “review” appraisal would suggest some type
ht

of impropriety. Furthermore, why is the lender charging me an additional $300
tp
://

for its own “review”? (See Exhibit D.)
th
e re

C olu
al

O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

34
o m
.c
ng
ni
s.
rie
na
PY tio

35
O
C olu
v
re
al
ere
th
Exhibit D ://
tp
ht
72. I paid an additional $300 for that? But to sink the nail in the coffin of the issue

that all lenders were inflating the appraisal value of properties in America so

that they could fraudulently drive up the market, I will introduce documents

from different lenders to different consumers. On Exhibit E, Robin Reed is

charged $450 for appraisal fees (at the very top of this document at the second
ht

line). But the seventh line of this same document shows that Robin is again
tp
://

charged $175 for an “APPRAISAL REVIEW FEE.” So, like me, Robin Reed,
th

who had a totally different lender and broker than I, is charged two appraisal
e

fees. One is for “review.”
re

C olu
al

O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

36
o m
.c
ng
ni
s.
rie
na
PY tio

37
O
C olu
v
re
al
ere
th
://
Exhibit E

tp
ht
73. So now that we see different lenders with different brokers sending appraisals

to “review” and charging borrowers twice, that should raise a lot of suspicion as

to the integrity of the value of the property

74. Now I introduce a page from an appraisal from a totally different lender and

broker. Here, Robert Brown had an appraisal done. According to this
ht

document, Robert Brown‟s house has three extra bedrooms and other rooms,
tp
://

but I‟ve been to see Mr. Brown‟s house; it is not outlined as the appraisal
th

states. The appraisal also has three extra bedrooms in the back that did not
e

exist; they were porches, and one of the apartments is drawn wrong to include
re

C olu
al

an extra bedroom room that does not exist at all. (See Exhibit F.)
O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

38
o m
.c
ng
ni
s.
rie
na
PY tio

39
O
C olu
v
re
al
ere
th
://
Exhibit F
tp
ht
75. This evidence shows that different lenders were sending appraisals to

“review” and charging the homeowner extra. Now I will show you how they did

this and applied the fees. The evidence is on Exhibit G.

76. On Exhibit G, I discovered that the lender had secretly taken out a “New Loan”

on my property without my mom, Irene Wood, or my consent or knowledge.
ht

The title of this document is “NEW LOAN DISBURSEMENT.” On this New
tp
://

Loan Disbursement sheet, it tells a horrible tale of mortgage fraud that will
th

send shockwaves throughout the industry and will be felt all the way in
e

London, because it affects their economy too. These worthless mortgages are
re

C olu
al

attached to an index based on the London Libor; they were gambling with the
O
re

U.S. and British economy to destroy them both.
PY tio
v

77. On this document, at the very top, it clearly states that the loan amount is

$263,920. However, if you look at the very bottom at the right side it states

that the “TOTAL CREDIT” given to us is $279,134.10.
na

78. First of all, I paid all the closing cost out of my pocket in cash. It cost me
rie

$12,092.91 which I paid before the loan was even closed.
s.

79. So now let‟s break down this $279,134.10 credit that was given us, even though
ni
ng

we borrowed only $263,920. To get the accurate percentage you will need a
.c

mortgage calculator, but if you do not have one, then all you have to do is
o

round off the percentage to the highest whole number; that‟s how it‟s done.
m

Starting at the top of the New Loan Disbursement sheet, the FASB ORIG

40
LOAN FEES are $6,279.56. Adding the $55.50 for title insurance and other

fees brings the total to $6,335.08.

80. Further down is “FASB COSTS.” FASB COST is the cost of securitizing the

loan. When the investor on Wall Street purchases a loan from a lender, the

investor must report the amount of money he paid for the loan and the amount
ht

of money it took to securitize the loan for sale on Wall Street. The FASB COST
tp
://

for securitization is $11,609.80.
th

81. “PREPAID INTEREST” is recorded as $1,696.41, and across from that that it
e

says “INTEREST DUE BROKER PREMIUM PAID $3,958.” But the problem
re

C olu
al

here is that I had already paid the broker $6,240 in upfront cash, so this
O
re

additional $3,958.80 is an illegal kickback under the federal RESPA. This
PY tio
v

payment to the broker, which represents 1.5% of the loan amount, had already

been added onto the interest rate of the loan. The original interest rate was

7.19%, but the broker‟s illegal kickback of $3,958.80 or 1.5% was added to give
na

me a starting interest rate of 8.690%. This is what they did to everyone; they
rie

charged everyone a yield spread premium or YSP (illegal kickback) and pay it
s.

to the broker for the referral, then that 1.5% is added on to the starting
ni
ng

interest rate of the loan.
.c

82. The investor puts up the money and the lender hires the local mortgage
o

brokers and offers them 1.5% of the loan to refer the borrower and to gather
m

the necessary information. The lender, who is the master broker, then pays the

local broker his cut of 1.5% ($3,958.80) and adds it to the interest rate of the

41
loan. So the original interest was 7.19%, then they add 1.5% and now I have a

starting interest rate of 8.60%. (Remember I had already paid the broker over

$6,200 in out of pocket cash). The master broker, who is the lender, then

commits the mortgage fraud and transfers this fraud to the investor on Wall

Street. In return for originating the loan, the investor then pays the lenders‟
ht

loan officers their share of the illegal kickback, in my case $9,939.38, and the
tp
://

bank itself gets a cut from the interest of the loan after the investor securitizes
th

them and sells them on the market. (These lenders are lying about losses and
e

receiving bailouts, when they did not even use their own money to fund the
re

C olu
al

loans. It is the investors who are suffering the losses, so when the banks apply
O
re

for the bailout, they have to hand it over to the investors. That was a part of
PY tio
v

the deal. It was well planned. )

83. I thought I should get that issue out of the way, so now, let‟s turn back to the

issue at hand and start putting these figures together. On Exhibit G, in
na

SECTION B at the left hand side, it tells us how much it cost the seller on Wall
rie

Street to acquire the loan from the lender; the amount is $9,939.38. This
s.

money is supposed to be the FNMA or Fannie May fee, cost for originating the
ni
ng

loan, but this is a double charge so it cannot be counted as a FNMA fee, but
.c

how did they arrive at this figure if at the top it only says $6,279.58 plus
o

$55.50, for a total of $6,335.08? I suspected that they had hidden these fees so
m

I went searching and found that the local broker‟s illegal kickback of $3,958.80

is not even included; it would carry the amount over the $9,939.38, so that‟s

42
when I began to explore further. I added the $6,279.58 plus the $55.50 to the

prepaid interest of $1,696.41 for a grand total of only $8,031.49. This did not

justify the fee so I then subtracted the actual loan amount of $263,920 from the

wired amount of $265,827.89, and I had a balance of $1,907.89. I took this

balance of $1,907.89 and added it to the grand total of $8,031.49 and I got a
ht

grand total of $9,939.39. That is how they hide the fees; they stick them in
tp
://

unusual places.
th

84. So there we have so far, the stealing of $9,939.36, but further down they add
e

the AQUISION COST of $9,939.38 to the FASB 91 Costs of $11,609.80 for a
re

C olu
al

grand total of $21,549.18. Then at the bottom on the left it says TOTAL
O
re

CREDIT = $279,134.10. But here is where they pulled the wool over the
PY tio
v

government‟s eyes because they have to file these figures with the government.

If you add the $21,549.18 to the loan amount of $263,920, you will get a total

$285,469.18; therefore, that is not how they did it.
na

85. The right side of this document states that the total amount wired to the
rie

closing attorney was $265,827.89. Add that amount to the securitization cost
s.

(FASB 91 COST of $11,609.80), and you get the total of $277,437.69, but the
ni
ng

total credit is $279,134.10; therefore, there is some money unaccounted for. It
.c

took me a while but I finally found it hidden on another form, even though the
o

lender had already charged me prepaid interest of $1,696.41 and added it to
m

the acquisition cost, they still went and charged me the very same prepaid

interest a second time. If you add that $277,437.10 on Section B, to another

43
prepaid interest amount of $1,696.41, you will get the total credit of

$279,134.10. They had double charged me for everything.

86. So now we see how they came up with the total credit of $279,134.10, let‟s

figure out how this factored into the 6% that would be attached to the interest

rate of the loan to make it an Adjustable Rate Mortgage loan. If you take that
ht

$279,134.10 credit and subtract the actual loan amount of $263,920 from it,
tp
://

you will have a total of $15,214.10.
th

87. Now this is how you get the percentage of the loan amount: Using a mortgage
e

calculator, divide $15,214.10 by the loan amount. $15,214.10 divided by
re

C olu
al

$263,920, is 0.06. If you use a regular calculator, you will get 5.79%, but a
O
re

mortgage calculator would round that off to the nearest whole number of 6%.
PY tio
v

88. That 6% which the lender steals from the equity of the people‟s property by

fraudulently inflating the appraisal, is used to securitize the loan for the

benefit of the foreign investor. Then to add “in your face insult” to injury, they
na

add that very same stolen equity as a 6% interest to the loan, and we have
rie

ourselves a beautiful cuddly mortgage loan I like to call Gizmo; some called it
s.

“The American Dream.” But Gizmo has to be fed. Little did we know that in
ni
ng

two years our cute little Gizmos would spawn other tiny creatures which would
.c

turn our American Dreams into Nightmare Mortgages.
o

89. Americans were forced into financing our own downfall while at the same time
m

protecting the foreign investors from loss. This is what‟s been going on in our

country! (See Exhibit G.)

44
o m
.c
ng
ni
s.
rie
na
PY tio

45
O
C olu
v
re
al
ere
th
://
Exhibit G
tp
ht
90. “We did not take out any new loan so why is there a “New Loan

Disbursement”? The master broker (the lenders) illegal kickback of $9,939.38

plus the local broker illegal kickback of $3,958.80 is not even added in the

$15,214.10 overage. If you add those figures you would get an additional

$13,898.18, then add that figure to the 6% of $15,214.10 you will get a grand
ht

total of $29,112.28, the percentage of that figure compare to the loan amount of
tp
://

$263,920 is 11%, add that 11% to the 4% plus I was charged in upfront cash,
th

and I was charged over 15% in origination fees. Three times above the legal
e

permissible threshold, 6% of which was credited to the Seller then added to
re

C olu
al

the loan. My property was negative $29,112.28 before I even moved in. This is
O
re

what‟s happening in our country, and no one was paying any attention. I
PY tio
v

wonder who was drinking more of the rum punch, Wall Street or the

regulators?

91. On the next document (Exhibit H) from Robin Reed, the closing attorney was
na

instructed: “WE ARE TO BE AT NO EXPENSE IN THIS TRANSACTION”
rie

(See Exhibit H at the bottom of the document just above where it states, “Title
s.

Insurance Requirement.”)
ni
ng

92. They did not even want to pay to bond and securitize their own loans. Last
.c

time I checked with Robin she was having problems with her loan.
o m

46
o m
.c
ng
ni
s.
rie
na
PY tio

47
O
C olu
v
re
al
ere
th
://
tp
Exhibit H
ht
93. I have the files of some of the investment firms and I will discuss two. On one

portfolio, the SG Mortgage 2006 Fre-2 Series, of which my own loan is a part,

has 8,112 family homes, while the OPT-2 Series has 3,486 homes. The

“appraisal type” of 95% of those loans is 2. That 2 stands for “Review.” They

had to do this in order to keep track of which loan had an inflated appraisal.
ht
tp

By trying to keep track, they gave themselves away. The two list total over
://

500 pages of account numbers and addresses spread across the country, as
th

tempting as it is, I won‟t attach them, but I have attached two pages for
e re

demonstration and will present the rest at the hearing. A family home in every
C olu
al

state of the Union is included in the lists.
O
re

PY tio
v

loan_id MI Flag Index type Subsequent Adj Period Appraisal Type Actual Balance
Next Due Date
-------------------------------------------------------------------------------------------------------
------------------
na

1000002145 No MI Product 6 mo Libor 6 months 2
rie

426,421.67 7/1/2006
1000002153 No MI Product 6 mo Libor 6 months 2
350,664.66 8/1/2006
1000002154 No MI Product 6 mo Libor 6 months 2
s.

205,081.61 7/1/2006
1000002160 No MI Product 6 mo Libor 6 months 2
ni

139,312.07 8/1/2006
1000002167 No MI Product 6 mo Libor 6 months 2
1000314621 No MI Product 6 mo Libor 6 months 2
ng

191,887.22 8/1/2006
1000314622 No MI Product 6 mo Libor 6 months 2
93,444.41 9/1/2006
.c

1000314642 No MI Product 6 mo Libor 6 months 2
467,652.25 7/1/2006
1000314650 No MI Product 6 mo Libor 6 months 2
o

258,573.32 7/1/2006
1000314655 No MI Product 6 mo Libor 6 months 2
m

256,703.70 7/1/2006
1000314659 No MI Product 2
302,835.10 7/1/2006
1000314664 No MI Product 6 mo Libor 6 months 2
692,000.00 7/1/2006
1000314667 No MI Product 2
415,322.72 7/1/2006
1000314671 No MI Product 6 mo Libor 6 months 2
595,172.81 7/1/2006

48
1000314674 No MI Product 6 mo Libor 6 months 2
305,765.50 7/1/2006
1000314678 No MI Product 6 mo Libor 6 months 2
341,880.31 7/1/2006
1000314690 No MI Product 6 mo Libor 6 months 2
1000314697 No MI Product 6 mo Libor 6 months 2
359,200.00 7/1/2006
1000314708 No MI Product 6 mo Libor 6 months 2
279,692.33 7/1/2006
1000314711 No MI Product 6 mo Libor 6 months 2
299,783.27 8/1/2006
1000314714 No MI Product 6 mo Libor 6 months 2
208,852.79 6/1/2006
1000314715 No MI Product 6 mo Libor 6 months 2
314,275.76 7/1/2006
ht

1000314721 No MI Product 2
90,670.61 7/1/2006
1000314739 No MI Product 6 mo Libor 6 months 2
tp

71,927.38 7/1/2006
1000314743 No MI Product 6 mo Libor 6 months 2
254,400.00 8/1/2006
://

1000314744 No MI Product 2
28,262.12 8/1/2006
1000314749 No MI Product 6 mo Libor 6 months 2
th

141,696.35 7/1/2006
1000314766 No MI Product 6 mo Libor 6 months 2
e

310,226.66 7/1/2006
1000314769 No MI Product 2
re

88,956.50 7/1/2006
1000314772 No MI Product 6 mo Libor 6 months 2
C olu

301,491.00 8/1/2006
al

1000314776 No MI Product 2
64,739.92 7/1/2006
O
re

1000314785 No MI Product 6 mo Libor 6 months 2
179,767.29 7/1/2006
PY tio

1000314809 No MI Product 6 mo Libor 6 months 2
v

242,879.23 7/1/2006
1000314830 No MI Product 2
96,927.82 7/1/2006
1000314839 No MI Product 6 mo Libor 6 months 2
258,000.00 7/1/2006
1000314851 No MI Product 6 mo Libor 6 months 2
167,876.91 7/1/2006
1000314854 No MI Product 2
167,890.10 8/1/2006
na

1000314861 No MI Product 2
199,690.10 7/1/2006
1000314863 No MI Product 6 mo Libor 6 months 2
185,110.62 7/1/2006
rie

1000314868 No MI Product 6 mo Libor 6 months 2
215,665.43 7/1/2006
1000314870 No MI Product 2
77,532.60 7/1/2006
s.

1000314871 No MI Product 2
1000314882 No MI Product 6 mo Libor 6 months 2
ni

8000087928 No MI Product 6 mo Libor 6 months 2
8000087938 No MI Product 2
109,946.46 8/1/2006
ng

8000087945 No MI Product 6 mo Libor 6 months 2
394,716.75 8/1/2006
8000087949 No MI Product 6 mo Libor 6 months 2
.c

254,233.60 7/1/2006
8000087952 No MI Product 6 mo Libor 6 months 2
147,468.97 7/1/2006
o

8000087955 No MI Product 6 mo Libor 6 months 2
157,398.53 7/1/2006
m

8000087956 No MI Product 6 mo Libor 6 months 2
279,868.79 7/1/2006
8000087962 No MI Product 6 mo Libor 6 months 2
429,378.69 7/1/2006
8000087969 No MI Product 6 mo Libor 6 months 2
74,897.98 7/1/2006
8000087985 No MI Product 6 mo Libor 6 months 2
168,303.38 7/1/2006
8000088000 No MI Product 6 mo Libor 6 months 2
78,106.68 7/1/2006

49
94. The evidence shows that different lenders and property appraisers throughout

the United States were fraudulently inflating the value of real estate;

fraudulently raising the value and driving up the market, sending people

scrambling to buy and refinance; weaving the people into this Great Web of

Deceit, all the while stealing the nonexistent equity and holding out for future
ht

payments as compensation.
tp
://

95. A question that can be asked here is, “If someone is fraudulently inflating the
th

value of real estate, fraudulent inflating the market, and sucking out what
e

little equity that is left in it, what would happen when it reaches a certain
re

C olu
al

peak and there is really no equity in the properties to support it and allow for
O
re

refinancing?” Of course, it‟s going to crash. The market will collapse because
PY tio
v

they filled it up with helium then sucked it out and replaced it with carbon

monoxide. Every day the bucket goes to the well, one day the bottom will fall

out. And that is what‟s happening now; the bottom has fallen out of the
na

housing market and we now have upside down mortgages.
rie

96. Investors had a 50-state strategy in each individual mortgage portfolio. Under
s.

normal business practices, it would be a normal thing for a mortgage portfolio
ni
ng

to have properties in each state; however, if there is fraud on each mortgage
.c

loan, it means that all 50 states would suffer at once when they raise the
o

interest rate. This portfolio of securities and mortgage fraud is comprised of
m

8,112 family homes totaling almost $2 Billion, and trillions of dollars in

Securities. (See Exhibit I, 2 pages.)

50
Exhibit I, Page 1/2

SG Mortgage Series 2006 FRE-2

AGGREGATE MORTGAGE LOAN CHARACTERISTICS

Geographic Distribution
% of Principal
ht

Number of Balance as of
Geographic Mortgage Principal Balance as the Cut-off Weighted Average Weighted Average Weighted Average
Distribution Loans of the Cut-off Date Date Mortgage Rates FICO Original CLTV
tp

Alaska 3 $ 522,705 0.03% 9.058% 542 78.48%
://

Arizona 213 42,014,353 2.32 8.588% 603 80.06%
Arkansas 4 898,906 0.05 7.760% 638 82.59%
th

California 1,444 463,193,432 25.59 8.181% 636 81.33%
Colorado 141 20,737,389 1.15 8.127% 625 83.27%
e

Connecticut 148 32,445,739 1.79 8.760% 606 78.80%
re

Delaware 45 7,239,430 0.40 8.812% 600 81.35%
C olu
al

District of
Columbia 52 16,131,464 0.89 8.556% 633 80.97%
O
re

Florida 1,518 287,257,635 15.87 8.560% 620 80.72%
PY tio

Georgia 299 40,535,257 2.24 8.574% 627 83.96%
v

Hawaii 90 31,122,341 1.72 7.937% 663 80.66%
Idaho 27 4,563,098 0.25 8.414% 608 81.50%
Illinois 460 76,746,757 4.24 8.799% 629 82.73%
Indiana 39 3,363,880 0.19 8.885% 612 85.45%
Iowa 3 201,549 0.01 10.125% 578 89.58%
Kansas 8 739,067 0.04 8.750% 616 86.52%
na

Kentucky 4 332,144 0.02 9.905% 593 87.91%
Maine 11 2,027,625 0.11 8.671% 614 80.68%
rie

Maryland 547 127,356,226 7.04 8.412% 623 81.69%
Massachusetts 222 52,316,066 2.89 8.465% 633 81.14%
s.

Michigan 143 16,834,636 0.93 9.049% 615 83.24%
ni

Minnesota 143 22,915,250 1.27 8.467% 627 83.49%
Missouri 49 6,809,215 0.38 9.081% 605 83.05%
ng

Nebraska 4 312,159 0.02 9.357% 572 88.12%
Nevada 114 28,271,566 1.56 8.258% 626 80.57%
.c

New Hampshire 33 5,483,798 0.30 8.707% 599 78.52%
New Jersey 479 122,800,314 6.78 8.717% 620 80.14%
o

New Mexico 21 3,498,769 0.19 8.657% 608 83.16%
m

New York 592 181,102,284 10.01 8.242% 644 80.64%
North Carolina 110 12,545,251 0.69 8.775% 606 82.28%
Ohio 90 11,263,931 0.62 8.475% 610 85.79%
Oklahoma 9 1,201,562 0.07 8.859% 589 82.61%

51
Exhibit I, Page 2/2
A-I-9

AGGREGATE MORTGAGE LOAN CHARACTERISTICS

Geographic Distribution (continued)

Number
of % of Principal
Mortgag Principal Balance a Balance as of
ht

Geographic Distribution e s the Cut-off Weighted Average Weighted Average Weighted Average
(cont’d) Loans of the Cut-off Date Date Mortgage Rates FICO Original CLTV
tp

Oregon
56 $ 9,614,073 0.53% 8.321% 624 81.68%
://

Pennsylvania
139 19,506,890 1.08 9.131% 599 80.64%
th

Rhode Island
32 6,828,347 0.38 8.830% 599 76.79%
e

South Carolina
64 9,731,438 0.54 8.470% 615 82.15%
re

Tennessee
38 4,571,338 0.25 8.794% 592 82.52%
C olu
al

Texas
O

188 25,609,900 1.41 8.545% 636 82.19%
re

Utah
PY tio

28 5,201,483 0.29 8.362% 615 83.78%
v

Vermont
7 1,278,228 0.07 8.805% 629 83.60%
Virginia
311 74,366,783 4.11 8.481% 627 81.21%
Washington
93 19,426,527 1.07 8.307% 618 82.20%
West Virginia
na

13 1,382,150 0.08 8.119% 612 80.17%
Wisconsin
76 9,412,599 0.52 8.839% 619 86.21%
rie

Wyoming
2 229,823 0.01 7.680% 650 84.00%
1,809,943,3
s.

Total/Weighted
Average: 8,112 $ 74 100.00% 8.432% 627 81.27%
ni
ng

A-I-10
.c
o m

52
97. It is indisputable that the financial crisis that the American people are

suffering from is a direct result of the gross mortgage and securities fraud

perpetrated by the investment firms on Wall Street against the people of the

United States of America.

98. So to make the point clear: They tell homeowners not to worry about the
ht

interest rate being raised in two years because, „Oh, the market it so hot, you
tp
://

can refinance anytime before they raise your payment. This is a good deal man,
th

low interest rate. Take it! Take it! You can just refinance before they raise your
e

payment.‟ But they had already fraudulently inflated the value of millions of
re

C olu
al

American homes, cashed out at the nonexistent equity and used it to protect
O
re

themselves from loss. Then they had the audacity to attach the 6% to the
PY tio
v

interest rate of the loan and increase the monthly payments to compensate for

the 6% theft because they are “not to be of any expense in this transaction.”

The consumer cannot afford to make the increased monthly payments, so they
na

run back to the broker for help to refinance out of that loan.
rie

99. But those who had promised to help us get refinancing are nowhere to be
s.

found; they don‟t even return phone calls. It was a tragic day when millions of
ni
ng

Americans learned that they really had upside down mortgages because their
.c

lenders had already cashed in their equity.
o

100. As if the stealing of our equity was not enough, they took it further; they did
m

not even consider the borrower‟s ability to repay the loan when the interest

rate is adjusted to the 6%. The federal Truth In Lending Laws Regulation Z

53
and all the states‟ predatory lending laws prohibits the use of the appraisal

value of a property as the basis for repayment of the loan. Specifically, “A

creditor extending mortgage credit subject to § 226.32 [high cost loans] shall

not extend credit to a consumer based on the value of the consumer's collateral

without regard to the consumer's repayment ability as of origination including
ht

the consumer's current and reasonably expected income, employment, assets
tp
://

other than the collateral, current obligations, and mortgage-related
th

obligations.”
e

101. However, despite this stern forbiddance by both federal and state lending
re

C olu
al

laws, investors on Wall Street were still granting homeowners loans based
O
re

strictly on the inflated value of the property. Below is an excerpt from the SG
PY tio
v

Mortgage Fre-2 Series, which is identical to the language of the OPT-2 series.

For the past two years, I have inspected about a hundred different portfolios

with millions of American family homes, and they all have the very same
na

underwriting policies. They had a central figure writing these portfolios. All
rie

the banks were doing the very same exact thing.
s.
ni

SG Mortgage series 2006 Fre-2 and series 2006 OPT-2
ng

Underwriting Policies
.c

General Standards
o

As described in the accompanying prospectus supplement, some mortgage loans may have been originated
m

under “limited documentation,” “stated documentation” or “no documentation” programs that require less
documentation and verification than do traditional “full documentation” programs. Under a limited
documentation, stated documentation or no documentation program, minimal investigation into the
mortgagor’s credit history and income profile is undertaken by the originator and the underwriting may
be based primarily or entirely on an appraisal of the mortgaged property and the LTV ratio at
origination. The adequacy of a mortgaged property as security for repayment of the related mortgage loan will

54
typically have been determined by an appraisal or an automated valuation, as described above under “—Loan-to-
Value Ratio.”

102. So right there in plain sight for the entire world to see, these investors

were blatantly violating the laws and basing their decision to grant a loan

entirely on the inflated value of the property. They were not concerned about
ht

the borrowers‟ income or their ability to repay, because they had the value of
tp

the property. But it does not end there. Below are more “in-your-face”
://
th

violations.
e re

Underwriting Policies
C olu
al

General Standards
O
re

-14-
PY tio
v

. In certain instances, the LTV ratio or CLTV ratio may have been based on the appraised value as indicated on a
review appraisal conducted by the mortgage collateral seller or originator.
na

The underwriting standards applied by an originator typically require that the underwriting officers of the
originator be satisfied that the value of the property being financed, as indicated by an appraisal or other acceptable
valuation method as described below, currently supports and is anticipated to support in the future the outstanding
rie

loan balance. In fact, some states where the mortgaged properties may be located have “anti-deficiency” laws
requiring, in general, that lenders providing credit on single family property look solely to the property for
repayment in the event of foreclosure. See “Certain Legal Aspects of Mortgage Loans and Contracts.” Any of these
s.

factors could change nationwide or merely could affect a locality or region in which all or some of the mortgaged
ni

properties are located. However, declining values of real estate, as experienced periodically in certain regions, or
increases in the principal balances of some mortgage loans, such as GPM Loans and negative amortization ARM
ng

loans, could cause the principal balance of some or all of these mortgage loans to exceed the value of the mortgaged
properties.
.c

Based on the data provided in the application and certain verifications, if required, and the appraisal or other
valuation of the mortgaged property, a determination will have been made by the original lender that the
o

mortgagor‟s monthly income would be sufficient to enable the mortgagor to meet its monthly obligations on the
m

mortgage loan and other expenses related to the property. Examples of other expenses include property taxes, utility
costs, standard hazard and primary mortgage insurance, maintenance fees and other levies assessed by a
Cooperative, if applicable, and other fixed obligations other than housing expenses including, in the case of junior
mortgage loans, payments required to be made on any senior mortgage. The originator’s guidelines for mortgage
loans will, in most cases, specify that scheduled payments on a mortgage loan during the first year of its term
plus taxes and insurance, including primary mortgage insurance, and all scheduled payments on obligations that
extend beyond one year, including those mentioned above and other fixed obligations, would equal no more than

55
specified percentages of the prospective mortgagor‟s gross income. The originator may also consider the amount
of liquid assets available to the mortgagor after origination.

103. The lenders were not concerned about borrowers‟ ability to repay the

loan, but they had to make it look good just in case anyone in the government

finally awoke from their sleepless slumber and started looking, so they created
ht

the borrowers‟ income. Contrary to the widely spread accusation by lenders
tp
://

that borrowers were falsifying their own income, I will dispel that notion right
th

now and prove that it was the master brokers, the lenders themselves, who
e

were doing the falsification behind the borrower‟s back. I will prove that
re

C olu
al

lenders were inventing their very own perfect borrower.
O
re

104. At the time when I applied for my mortgage loan, I reported that my income
PY tio
v

was $4,000, but my credit scores were not high enough so they told me that I

needed a co-signer. I asked my mom, Irene Wood, to be my co-signer. My mom

was not employed; she was collecting social security benefits, but they said it
na

was a no documentation loan so they did not need any income or anything from
rie

my mom, just her good credit; only my income would be used.
s.

105. But after my loan went into default and I filed suit against my lender, I
ni
ng

demanded that they turn over all the documents that were used in the
.c

origination of the loan. It was then that I was convinced that this had to be the
o

largest financial rip-off scheme ever known to man. Every single document was
m

a forgery.

56
106. It was after receiving those documents that I realized why they called

subprime loans “No Documentation” Loans; the lenders were making up their

own documents, including the income documents. I will prove it.

107. As stated before, my mom, Irene Wood, was my co-signer. She had no

employment and she is collecting social Security benefits in the amount of
ht

around $458 per month. However, according to the “Fremont Investment &
tp
://

Loan Underwriting Summary” document which they sent me, my mom is
th

employed and making $8,841, per month. It also states that my mom‟s total
e

debt was $3,242, with a debt ratio of 32.670. The document is signed by the
re

C olu
al

master brokers. (See Exhibit J.)
O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

57
o m
.c
ng
ni
s.
rie
na
PY tio

58
O
C olu
v
re
al
ere
th
://
Exhibit J
tp
ht
108. That document also clearly states that my mom‟s total debt is $3,242;

however, the underwriter had my mom‟s credit report before them, and they

sent it to me. At the top of this document it clearly states that the credit report

was prepared for Fremont Investment & Loan. The credit report also clearly

states that my mom‟s total debt was $22,175, not $3,242. (See Exhibit K.)
ht
tp
://
th
e re

C olu
al

O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

59
o m
.c
ng
ni
s.
rie
na
PY tio

60
O
C olu
v
re
al
ere
th
://
Exhibit K tp
ht
109. However, it does not end there. Fremont knew that my mom was unemployed

and that she was collecting pension because they had her credit report right in

front of them that clearly states that my mom was getting a pension and that

her employment was unknown. This is page 4 of the actual credit report the

underwriter used, again you will see Fremont name on there, and the
ht

checkmarks were made by them. Under where it says Employment
tp
://

Information it clearly states Pension SEG Social and Occupation Unknown.
th

They sent me this credit report also, producing the proof against themselves.
e

Playing smart but not being clever. (See Exhibit L.)
re

C olu
al

O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

61
o m
.c
ng
ni
s.
rie
na
PY tio

62
O
C olu
v
re
al
ere
th
://
tp
Exhibit L
ht
110. The underwriter had the credit report before them which shows that my mom

was unemployed and collecting Social Security benefits. They also knew that

her debt was $22,175, but to cover them in case someone started asking

questions, they created an employment and gave her a position as office

manager working at that position for 5 years. Then they made up an income
ht

verification form to show that my mom is employed. They then put that form in
tp
://

my mom‟s portfolio. Note that the form is not signed by any employer;
th

therefore, it was not even verified. It was never even mailed out for the
e

employer. (See Exhibit M.)
re

C olu
al

O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

63
o m
.c
ng
ni
s.
rie
na
PY tio

64
O
C olu
v
re
al
ere
th
://
Exhibit M tp
ht
111. But it does not end there; they asked us to open an account and to deposit

$6,000 in it as proof of two months reserve mortgage payments, then to call

them with the account number so they could verify it. We opened a checking

account with $7,000 then called and gave them the account number. They said

they would verify the account. Exhibit N is the “Request for Verification of
ht

Deposit” that the lender attached to my mom‟s portfolio. A quarter of the way
tp
://

down on the left, it says that the account has a balance of $20,000. But in the
th

middle, it says the current balance is $19,626 with an average balance of
e

$18,500. On the same line it says that the account was opened on 4-1-05. The
re

C olu
al

document was signed by a customer service representative at Citizen‟s Bank.
O
re

PY tio
v

na
rie
s.
ni
ng
.c
o m

65
o m
.c
ng
ni
s.
rie
na
PY tio

66
O
C olu
v
re
al
ere
th
://
Exhibit N tp
ht
112. Keeping in mind that that their verification of deposit form states that the

account was opened on 4-1-05 with a balance of $19,626 and that it was

verified by a Susan Fernandez at Citizen Bank, Exhibit O tells a different

story. Exhibit O, which is the true bank statement, clearly states that the

account was opened on 5-2-06 not 4-1-05 as stated by the underwriter. This
ht

document also clearly states that on that day (5-1-06), we made a deposit of
tp
://

$7,000, and at the close of business the balance was $6,980.
th

113. Compare the two documents and you will see that the account numbers are
e

the same. I went to Citizen Bank to investigate, and they said they never even
re

C olu
al

got the document; it was a total fabrication. What they did was probably called,
O
re

got the name of the customer service representative, and then signed her name
PY tio
v

to the form. (See Exhibit O.)
na
rie
s.
ni
ng
.c
o m

67
o m
.c
ng
ni
s.
rie
na
PY tio

68
O
C olu
v
re
al
ere
th
://
Exhibit O
tp
ht
114. As is totally clear from those documents, it was the lenders, not the

borrowers who were creating all these falsities to qualify borrowers for a loan.

To cover themselves, during the closing lenders were slipping new loan

applications with the fraud on it into the loan documents and tricking borrows

into signing them, so if anyone asked, it would be the borrower‟s signature on
ht

the fraud and the lender would get away with fraud.
tp
://

115. And it was not only us that they did this too; they did it to every single
th

borrower who had a “No documentation” or “limited documentation” loan, and I
e

will prove it. There are 8,112 family homes in the SG Mortgage Fr-2 series
re

C olu
al

portfolio. Exhibit P clearly states that of that amount, 3,705 were “stated
O
re

documentation” and 35 “limited documentation.” Both of these mean “No docs”
PY tio
v

loans. But look how many borrows on this single portfolio did not have to

produce documents. Now a question to be asked is, if they did this to Muckle‟s

loan, what did they do to the other 8,111 loans in this portfolio, and what did
na

they do to the other 10 millions subprime loans? Despite the “full
rie

documentation” mentioned, all subprime loans were “no docs” loans. I have a
s.

list of over 12,000 borrowers including their account numbers and their
ni
ng

addresses, in all 50 states, who had a “no docs” loans.
.c
o m

69
Exhibit P
SG Mortgage series 2006-Fre-2

AGGREGATE MORTGAGE LOAN CHARACTERISTICS

Documentation Type
ht

% of Principal
tp

Number of Balance as of
Mortgage Principal Balance as the Cut-off Weighted Average Weighted Average Weighted Average
Documentation Type Loans of the Cut-off Date Date Mortgage Rates FICO Original CLTV
://

Full Documentation 4,372 $ 905,281,033 50.02% 8.078% 619 82.27%
Stated Documentation 3,705 893,588,200 49.37 8.791% 636 80.21%
th

Limited Documentation 35 11,074,140 0.61 8.460% 605 84.51%
e

Total/Weighted Average: 8,112 $ 1,809,943,374 100.00% 8.432% 627 81.27%
re

C olu
al

O
re

A-I-12
PY tio
v

116. I also have the actual loan applications of several different borrowers,

originated by different lenders and all of the loan applications have the income
na

falsified. The lenders were creating their own ideal borrowers and they were
rie

not worried about the borrower‟s ability to repay because they had already
s.
ni

stolen the equity out to pay for private mortgage insurance to protect them
ng

against the loss which they knew was coming. They thought they had the
.c

greatest plan on earth. They might have gotten away with it, too, had they not
o m

chosen my mom as a victim.

117. On exhibit Q, like every other 10 million subprime borrowers, Robin Reed is

tricked into signing a new loan application at the closing.

70
118. Like me, Robin was never aware that she had signed a loan application with

the space for income left blank. If you notice at the bottom of the document,

part lV “Employment Information,” Robin Reed has 3 years on the job. Then

right under that, it again mentions her 3 years of employment. However, in the

second space for employment history there is a space for the amount of
ht

monthly income. One space back up you can see where the fraud came in.
tp
://

Where they should have placed Robin‟s income, they filled it in with “yrs
th

employed in this line of work/profession, then filled it in with 3. They left the
e

amount of monthly income blank; therefore, Robin has no income.
re

C olu
al

119. If you notice this broker is Nationwide Equity, a totally different lender from
O
re

mine. I had Fremont. They tricked their borrowers into signing loan
PY tio
v

applications with blank spaces so that they can go in and fix the income as

needed. (See Exhibit Q.)
na
rie
s.
ni
ng
.c
o m

71
o m
.c
ng
ni
s.
rie
na
PY tio

72
O
C olu
v
re
al
ere
th
://
Exhibit Q
tp
ht
120. Exhibit R is from another borrower, Michael Lieb. Michael‟s loan

application is identical to Robin‟s. They were both tricked into signing loan

applications were the space for the monthly income was filled in so that the

income could not be placed there. Like Robin and me, they were not concerned

with the ability to repay.
ht

121. Michael‟s lender is also different. The broker is Mortgage Center of
tp
://

America and the lender is New Century, and the investor is Deutsche Bank.
th

So far I have shown three different lenders and three different mortgage
e

brokers, with three different investors, all committing fraud with different
re

C olu
al

borrowers. What did they do to the other 10 million borrowers? (See Exhibit
O
re

R.)
PY tio
v

na
rie
s.
ni
ng
.c
o m

73
o m
.c
ng
ni
s.
rie
na
PY tio

74
O
C olu
v
re
al
ere
th
://
tp
ht
Exhibit R
122. By the time Michael found out that the attorney he had hired to represent

him at the closing had been recommended to him by the broker and was in

cahoots with the broker, it was too late; the sheriffs were escorting him and his

belongings out into the streets. He was evicted by decree of an American judge

presiding in an American Court of law set up in the Commonwealth to preside
ht

over these matters.
tp
://

123. If the housing court had only given Michael his constitutional rights to due
th

process, and had it adhered to the state‟s predatory lending laws instead of
e

granting the vulture a one-sided hearing, maybe they would have found out
re

C olu
al

that Michael‟s income had been falsified by the lender, and that his appraisal
O
re

had been inflated. Then maybe an alarm bell would have gone off and 4 million
PY tio
v

families may not have lost their homes to this grossly “in-your-face” fraud. (See

Exhibit S.)
na
rie
s.
ni
ng
.c
o m

75
o m
.c
ng
ni
s.
rie
na
PY tio

76
O
C olu
v
re
al
ere
th
://
Exhibit S
tp
ht
124. Between December 31, 2009, and March 31, 2006, according to Fremont, they

had 6,067 foreclosures and bankruptcies. I do not have the figures for between

March 2006 and April 20, 2009, but it must be more than double that, as

Fremont was named one of the top five subprime lenders in the country. How

many more of the 114,929 loans originated by March 31 and the more than
ht

16,000 originated by April 17, 2007, are in foreclosure or have been foreclosed
tp
://

on? I would bet that the numbers are more than 70, 0000.
th

Fremont Investment & Loan
e re

The information contained in this prospectus supplement with regard to Fremont Investment & Loan has been
provided by Fremont Investment & Loan.
C olu
al

Servicing
O
re

Fremont has been servicing sub-prime mortgage loans since 1994 through its nationwide servicing operation,
PY tio

currently located in Ontario, California. As of March 31, 2006, Fremont was servicing 114,929 sub-prime residential
v

mortgage loans with a total principal balance of approximately $23.178 billion.

Fremont Mortgage Loan Servicing Portfolio

(Combined Loans Held for Sale, Interim Serviced, Held for Investment and Securitized)
na

Delinquencies and Foreclosures
rie

As of March 31, 2006 As of December 31, 2005
Percent Percent
s.

Principal by Principal by
Number Balance (in Principal Number Balance (in Principal
ni

of Loans thousands) Balance of Loans thousands) Balance
Current Loans 110,595 $22,388,444 96.59% 109,896 $ 21,521,721 96.72%
ng

Period of Delinquency
30 to 59 days 1,165 $ 251,992 1.09% 1,407 $ 268,612 1.21%
.c

60+ days 1,237 143,309 0.62% 725 85,171 0.38
Total Delinquencies 2,402 $ 395,301 1.71% 2,132 $ 353,783 1.59%
o m

Foreclosures/Forbearances 1,251 $ 279,595 1.21% 1,310 $ 264,469 1.18%
Bankruptcies 398 64,336 0.28% 547 83,521 0.38
Total Foreclosures and
Bankruptcies 1,649 $ 344,931 1.49% 1,857 $ 347,990 1.56%
Real Estate Owned 283 49,660 0.21% 183 $ 28,841 0.13%
Total Portfolio 114,929 $23,178,336 100.00% 114,068 $ 22,252,335 100.00%

77
125. Between the month of March 2008 and May 2008, SG Mortgage raised the

interest rate on 5,876 family homes in the Trust Series 2006-fre-2. Fremont,

and the top five predatory lenders originated all of these loans. All of these

loans have 6% unlawful fees attached to them. How many have inflated

income?
ht

126. I have two documents showing the impact on family homes; one will be
tp
://

submitted with the compliant and one will be submitted at the hearing. On
th

the document, the Series 2006 OPT-2, SG Mortgage also raised the interest
e

rate on 3,189 family homes for a total of 9,065 family homes on just these two
re

C olu
al

portfolios.
O
re

PY tio
v

SG Mortgage Trust Series 2006 Fre-2

AGGREGATE MORTGAGE LOAN CHARACTERISTICS

Next Rate Adjustment Date of the Adjustable-Rate Loans
na

% of Principal
Number of Balance as of
Next Rate Adjustment Date
rie

of the Adjustable-Rate Mortgage Principal Balance as the Cut-off Weighted Average Weighted Average Weighted Average
Loans Loans of the Cut-off Date Date Mortgage Rates FICO Original CLTV
March 2008 75 $ 21,875,845 1.40% 8.230% 637 81.56%
s.

April 2008 1,534 425,589,205 27.24 8.283% 625 80.51%
May 2008 3,537 910,553,898 58.27 8.317% 624 80.04%
ni

June 2008 730 186,096,713 11.91 8.445% 617 80.07%
ng

April 2009 16 4,537,874 0.29 7.890% 636 84.80%
May 2009 37 7,129,746 0.46 7.984% 643 78.54%
.c

June 2009 8 1,936,761 0.12 7.413% 613 74.13%
April 2011 9 2,082,254 0.13 9.052% 583 79.15%
o

May 2011 8 2,077,300 0.13 8.308% 620 79.24%
m

June 2011 2 720,750 0.05 7.337% 610 76.35%
Total/Weighted
Average: 5,956 $1,562,600,347 100.00% 8.318% 624 80.19%

A-I-19

78
o m
.c
ng
ni
s.
rie
na
PY tio

79
O
C olu
v
re
al
ere
th
://
tp
ht
127. If anyone is interested in knowing why the market collapsed on September

15, 2008, all they have to do is take a look at the following documents. This is

the type of payments the investors were paying out on securities attached to

worthless promissory notes. SG Mortgage, along with several different note

holders raised the interest rates on several thousand American Family homes,
ht

knowing that borrowers could not afford to make the increased payment
tp
://

because they had falsified the income of their borrowers. From the evidence,
th

we see that all the subprime loans with an adjustable rate interest are
e

unlawful. Put those combinations together and we have a recipe for disaster.
re

C olu
al

O

The “Swap Notional Amount” with respect to each Distribution Date commencing in August 2006, is set
re

forth below (which will be substantially the same schedule as set forth in the Interest Rate Swap Agreement). The
PY tio

Interest Rate Swap Agreement will terminate immediately following the Distribution Date in July 2011, unless
v

terminated earlier upon the occurrence of a Swap Default, an Early Termination Event or an Additional Termination
Event (each as defined below).

Swap Notional
na

Distribution Date Amount ($)
August 2006 1,776,458,000.00
rie

September 2006 1,760,006,643.84
October 2006 1,750,946,077.95
November 2006 1,744,913,946.73
s.

December 2006 1,718,677,124.78
ni

January 2007 1,689,604,141.72
February 2007 1,657,701,561.88
ng

March 2007 1,621,248,861.42
April 2007 1,582,211,157.25
.c

May 2007 1,535,804,145.69
o

June 2007 1,486,588,080.95
m

July 2007 1,436,965,685.50
August 2007 1,388,354,070.01
September 2007 1,340,369,635.29
October 2007 1,293,848,910.86
November 2007 1,250,108,970.24
December 2007 1,203,473,143.32

80
January 2008 1,155,211,328.98
February 2008 1,086,817,200.23
March 2008 1,022,652,186.11
April 2008 962,459,123.44
May 2008 905,973,035.45
June 2008 852,933,042.75
July 2008 803,203,916.10
August 2008 453,917,305.59
September 2008 427,629,086.18
ht

October 2008 402,949,541.45
November 2008 379,753,147.03
tp

December 2008 357,889,459.48
January 2009 345,522,433.47
://

February 2009 333,593,841.50
th

March 2009 322,082,794.74
April 2009 310,974,355.83
e

May 2009 300,254,140.30
re

June 2009 289,908,376.41
C olu

July 2009 279,924,235.92
al

August 2009 270,288,203.53
O
re

September 2009 260,987,905.07
PY tio
v

October 2009 252,026,328.29
November 2009 243,434,072.86
December 2009 235,135,853.39
January 2010 227,121,909.53
February 2010 219,382,098.54
March 2010 211,907,005.75
na

April 2010 204,687,541.28
May 2010 197,714,928.56
rie

June 2010 190,980,693.70
July 2010 184,476,847.50
s.

August 2010 178,195,284.59
September 2010 172,128,377.42
ni

October 2010 166,268,761.48
ng

November 2010 160,609,325.89
December 2010 155,143,205.04
.c

January 2011 149,863,903.32
February 2011 144,764,876.49
o

March 2011 139,839,943.98
m

April 2011 135,083,138.04
May 2011 130,488,696.32
June 2011 126,050,987.49
July 2011 121,759,382.31

81
128. But to make matters worse, over 10 million subprime garbage were attached

to tradable securities tied directly to the performance of the U.S. dollar. With

respect to the adjustable rate mortgage loans, the Index is the average of

interbank offered rates for six-month U.S. dollar deposits in the London

market based on quotations of major banks, and most recently available as of a
ht

day specified in the related note as published in the Western Edition of The
tp
://

Wall Street Journal (“Six-Month LIBOR”). If the Index becomes unpublished or
th

is otherwise unavailable, the servicer will select an alternative index which is
e

based upon comparable information.
re

C olu
al

129. There are over 10 million subprime loans with interest rates tied directly to
O
re

the U.S. dollar. Now a question to be asked here is, if the lenders and investors
PY tio
v

were purposely falsifying the income of their borrowers, and if they were

fraudulently inflating the value of property and cashing out the non-existent

equity, what would happen when they raise the interest rate and borrowers
na

cannot pay? There will be an avalanche of foreclosures and companies and
rie

individuals who were conned into buying up the worthless securities tied to
s.

those worthless promissory notes will take huge losses.
ni
ng

130. Illustration: I deposit a check for $100 in a checking account and I write
.c

someone a check for that $100. Before the person could cash the check, I went
o

and withdrew $99. What would happen when that person tries to cash the
m

check? The check is going to bounce. That is what happened on September 15,

2008. They raised the interest rate of several thousand family homes

82
throughout the U.S., knowing that the borrower could not pay, nor could they

refinance out because of the negative equity. And so the payments on the

tradable securities bounced and guess who had to step in to bail out the

crooks? The very same people who they had defrauded.

131. It was all a great big plan to destroy the U.S. economy. These foreign
ht

investors were gambling with the U.S. economy, but they did not even give it a
tp
://

chance to play out, because they had made sure that the borrower could not
th

pay, and they had made sure that they could not refinance out of the loan, and
e

they had falsely inflated the value of the collateral. The U.S Dollar deposit in
re

C olu
al

the London Libor did not stand a chance. Over 10 million fraudulent loans
O
re

with an index based on the U.S. and British economy, and now we know why
PY tio
v

there‟s a global recession. They planted a Trojan Horse on the U.S. and British

economy. This was not for profit; this was simply to destroy two nations

economy so that others could control the world‟s market.
na

132. And then the bailouts. What a tragedy. That was all part of the plan. But it
rie

does not end there. Exhibit T should send chills down the spines of everyone.
s.

According to the next document, no one, not even the SEC who was supposed
ni
ng

to be keeping watch, was paying attention nor did they approve of trillions of
.c

dollars of worthless securities attached to millions of American Family homes.
o

The SEC did not even so much as bat an eye. And people are wondering how
m

we got into this mess. (See last paragraph on Exhibit T.)

83
Exhibit T

Prospectus

Mortgage Asset-Backed Pass-Through Certificates and Asset-Backed Notes

SG Mortgage Securities, LLC
Depositor

SG Mortgage Finance Corp.
ht
tp

Sponsor
://

The depositor may periodically form separate trusts to issue securities in series, secured by assets of that trust.
th
e re

Offered Securities The securities in a series will consist of certificates or notes representing interests in a trust
and will be paid only from the assets of that trust. The securities will not represent interests
C olu
al

in or obligations of SG Mortgage Securities, LLC, SG Mortgage Finance Corp. or any of
O

their affiliates. Each series may include multiple classes of securities with differing payment
re

terms and priorities. Credit enhancement will be provided for all offered securities.
PY tio
v

Mortgage Collateral Each trust will consist primarily of:

• mortgage loans, which may include home equity loans, or manufactured housing
conditional sales contracts or installment loan agreements secured by first or junior liens on
na

one- to four-family residential properties; and/or
rie

• mortgage loans secured by first or junior liens on mixed-use properties, including
s.

cooperative loans; and/or
ni
ng

• mortgage securities and whole or partial participations in mortgage loans.
.c

Neither the Securities and Exchange Commission nor any state securities commission has approved
o

or disapproved of these securities or determined that this prospectus is accurate or complete. Any
m

representation to the contrary is a criminal offense.

July 5, 2006

84
133. It is also indisputable that the American government, against the expressed

views of the majority of the people, has knowingly and intentionally taken

the money of the people of the United States of America and has used the

people‟s money to pay out to the defendants, foreign and domestic, trillions of

dollars in bailout so that they may not go bankrupt due to the very mortgage
ht

fraud that they themselves perpetrated against the people of the United States
tp
://

of America.
th

134. The plaintiffs allege that that is a gross violation of Section 4 of the 14 th
e re

Amendment rights of the U.S. Constitution because the plaintiffs, being
C olu
al

O

taxpayers, are forced to pay for the loss of the very defendants who have
re

PY tio
v

knowingly and intentionally committed the very mortgage fraud from which

they seek bailout. Section 4 of the 14th Amendment sates, “The validity of the

public debt of the United States, authorized by law, including debts incurred
na

for payment of pensions and bounties for services in suppressing insurrection
rie

or rebellion, shall not be questioned. However, neither the United States nor
s.

any State shall assume or pay any debt or obligation incurred in aid of
ni

insurrection or rebellion against the United States, or any claim for the loss or
ng

emancipation of any slave; but all such debts, obligations, and claims shall be
.c

held illegal and void.”
o m

135. Based on the irrefutable evidence and the fact that former President George

W. Bush and current the President of the United States of America, Barak

85
Obama, and all the members of the United States Senate and Congress, and all

the governors have all stated that the financial crisis that America is facing is

a direct result of mortgage fraud committed by the defendants, then, under the

14th Amendment of the Unites States Constitution, Section 4, it is illegal for

the government of the United States of America to give any bailout or
ht

monetary assistance, or to pay any debt, or to purchase any of the unlawful
tp
://

loans from the defendants, using taxpayers money. That is a violation of the
th

U.S. Constitution; therefore, under the law, the court is compelled to block the
e

defendant‟s from selling or transferring any of those fraudulent loans at the
re

C olu
al

cost of the American taxpayer. The court is also compelled to block the
O
re

government from violating the people‟s 14th Amendment rights by assuming or
PY tio
v

paying any debt or obligation incurred in aid of insurrection or rebellion

against the United States, or any claim for the loss or emancipation of any

slave; but all such debts, obligations and claims shall be held illegal and void.
na

136. Is anyone willing to stand up and argue that this financial Armageddon we
rie

are facing is not a direct attack on the U.S. economy, perpetrated by foreign
s.
ni

and/or domestic entities?
ng

137. Under the U.S. Constitution, the bailouts are illegal, therefore the court is
.c

compelled to declare them void, to void the promissory notes and to confiscate
o

the people‟s mortgages and return them to the treasury of the citizens of the
m

United States as payment in kind for the bailout not returned, and for

damages caused to the people‟s economy.

86
138. All 10 million subprime promissory notes are the product of fraud, because

not only did lenders inflate the borrower‟s income, but they also falsified the

value of the collaterals, stole the equity, charged the illegal fees to the

borrowers, then forced borrowers to sign promissory notes agreeing to pay an

additional 6% in interest rate without telling the consume what that 6% truly
ht

represented. Under section 3-305 of the Uniform Commercial Code, the
tp
://

promissory notes are null and void. Under the right to enforce the obligation
th

of a party to pay an instrument is subject to the following: (1) a defense of the
e

obligor based on (i) infancy of the obligor to the extent it is a defense to a
re

C olu
al

simple contract, (ii) duress, lack of legal capacity, or illegality of the
O
re

transaction which, under other law, nullifies the obligation of the obligor, (iii)
PY tio
v

fraud that induced the obligor to sign the instrument with neither knowledge

nor reasonable opportunity to learn of its character or its essential terms, or

(iv) discharge of the obligor in insolvency proceedings;
na
rie

(b) The right of a holder in due course to enforce the obligation of a party to pay the

instrument is subject to defenses of the obligor stated in subsection (a)(1).
s.
ni

139. Under the Uniform Commercial Code, the investors who were in cahoots with
ng

the lenders are not entitled to recovery; therefore, the court is compelled to
.c

confiscate all 10 million subprime adjustable mortgage loans and to transfer
o m

said loans to the care and protection of the United States Treasury.

140. If the court fails to confiscate all loans, I will share all the evidence I gave

with all 10 million homeowners. I will splatter it across the Internet and give

87
the people instructions on how to file their own lawsuit for claim for mortgage

fraud. We will cripple the entire federal court system and collapse it. It is

illegal to make threats, that‟s why this is a promise. You can‟t prosecute me for

making a promise I intend to keep. For two years now I have been begging the

courts and the government to intervene on behalf of the people, I will not beg
ht

for relief anymore. The people are demanding it!
tp
://

141. In the previous lawsuit in which the federal court denied my motion to sue all
th

of the lenders and firms on Wall Street, the Court depended on Pagán to justify
e

his ruling. The plaintiff states that the court‟s finding based on Pagán is in
re

C olu
al

contravention of the issues in this instant case. Pagán involved a third party
O
re

lawsuit, in which the plaintiff was not directly affected; “the complaint
PY tio
v

contains no allegation that Pagán suffered any nonderivative injury, he lacks

standing to assert any of the section 1983 claims that are at issue here.”

142. A federal court must satisfy itself as to its jurisdiction, including a plaintiff's
na

Article III standing to sue, before addressing his particular claims, regardless
rie

of whether the litigants have raised the issue of standing. See Orr v. Orr, 440
s.

U.S. 268, 271, 99 S.Ct. 1102, 59 L.Ed.2d 306 (1979); Juidice v. Vail, 430 U.S.
ni
ng

327, 331, 97 S.Ct. 1211, 51 L.Ed.2d 376 (1977); see also Warth v. Seldin, 422
.c

U.S. 490, 498, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975) (explaining that standing is
o

a threshold issue in every federal case). The standing inquiry is both plaintiff-
m

specific and claim-specific. Thus, a reviewing court must determine whether

each particular plaintiff is entitled to have a federal court adjudicate each

88
particular claim that he asserts. Allen v. Wright, 468 U.S. 737, 752, 104 S.Ct.

3315, 82 L.Ed.2d 556 (1984); Donahue v. City of Boston, 304 F.3d 110, 116 (1st

Cir.2002). Only if a particular plaintiff has standing to pursue a particular

claim will the court proceed to assess the application of the qualified immunity

doctrine to that claim.
ht

143. Standing involves a collocation of constitutional requirements and prudential
tp

concerns. See Valley Forge Christian Coll. v. Ams. United For Separation of
://
th

Church & State, Inc., 454 U.S. 464, 471, 102 S.Ct, 752, 70 L.Ed.2d 700 (1982).
e

The Constitution confines federal courts to the adjudication of actual cases and
re

C olu
al

controversies. See U.S. Const. art. III, § 2, cl. 1; Allen, 468 U.S. at 750, 104
O
re

S.Ct. 3315. An actual case or controversy exists when the party seeking to
PY tio
v

invoke the court's jurisdiction (normally, the plaintiff) has a "personal stake in

the outcome" of the claim asserted. Baker v. Carr, 369 U.S. 186, 204, 82 S.Ct.

691, 7 L.Ed.2d 663 (1962). To satisfy the personal stake requirement, the
na

plaintiff must pass a tripartite test. See Lujan v. Defenders of Wildlife, 504
rie

U.S. 555, 560-61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992); Ramírez v. Ramos,
s.

438 F.3d 92, 97 (1st Cir.2006).
ni
ng

144. The first of these prerequisites deals with harm. The plaintiff must
.c

adequately allege that he “suffered or is threatened by [an] injury in fact to a
o

cognizable interest.” Save our Heritage, Inc. v. FAA, 269 F.3d 49, 55 (1st
m

Cir.2001). An injury in fact is one that is concrete and particularized, on the

one hand, and actual or imminent (as opposed to conjectural or hypothetical),

89
on the other hand. Lujan, 504 U.S. at 560, 112 S.Ct. 2130. In turn, a

particularized injury is one that "affect[s] the plaintiff in a personal and

individual way." Id. at 560 n. 1.

a. In this underlying case, the plaintiff states that the United States of

America is currently awash in an economic tsunami that‟s wreaking havoc
ht

on the livelihood of all the people.
tp
://

b. The financial crisis is primarily a direct effect of subprime adjustable
th

mortgage loan lending.
e

c. All government officials, including the President of the United States,
re

C olu
al

Barak Obama, and the vice president, and the treasurer and the SEC
O
re

have acknowledged that the subprime loans that are wreaking havoc on
PY tio
v

our nation‟s economy are the direct result of mortgage fraud and

predatory lending.

d. It is also irrefutable that property values have sank to record lows as a
na

direct result of said mortgage fraud and predatory lending.
rie

e. It is also indisputable that between 3 and 4 million American family
s.

homes, which the government has acknowledged, are the product of
ni
ng

mortgage fraud, have been foreclosed on within the last year.
.c

f. It is undisputable that in March foreclosure rocketed to a 24% high. Never
o

before in recorded history has this been seen. These subprime loans are
m

going to sink our country.

90
g. It is indisputable that throughout the country, entire neighborhood blocks

have boarded up buildings; all victims of what the government had

acknowledged being mortgage fraud.

h. It is undisputable that foreclosures of properties, which the government

has acknowledged to be the product of mortgage fraud, are degrading our
ht

neighborhoods and bringing down the value of all properties, which in
tp
://

turn weakens our communities.
th

i. It is also undisputable that even though the government knows and has
e

admitted that the mortgage loans are the direct product of mortgage
re

C olu
al

fraud, and that lenders have committed crimes to originate the loans, the
O
re

government still had to bail out those lenders in an attempt to ebb the
PY tio
v

further hemorrhaging of the economy.

j. It is also undisputable that I am an American resident who is also a

taxpayer and that every time I buy something I am taxed.
na

k. It is indisputable that it is the taxpayers of America, collectively, who are
rie

paying to bail out the perpetrators of fraud to prevent them from failing,
s.

due to the very fraud they themselves perpetrated against home owners.
ni
ng

l. American residents have suffered all of the above effects as a direct result
.c

of the mortgage fraud that the government has admitted was perpetrated
o

by the industry as a result of mortgage fraud.
m

91
m. Every time an American resident is foreclosed on, due to what the

government has acknowledged to be mortgage fraud, then that specific

foreclosure has a direct adverse effect on the entire country as a whole.

n. All American residents, whether they own a subprime loan or not, are

directly affected by any foreclosure of any subprime loan which are the
ht

product of mortgage fraud, as all foreclosures have a direct effect on the
tp
://

U.S. economy and cost the American taxpayer money both individually
th

and as a whole.
e

145. The second prerequisite deals with causation (what some courts have called
re

C olu
al

"traceability"). To meet this requirement, the plaintiff must adequately allege
O
re

that the asserted injury is causally connected to the challenged conduct. Id. at
PY tio
v

560. This causal connection must be demonstrable; in other words, it "cannot

be overly attenuated.” Donahue, 304 F.3d at 115.

a. The plaintiff has outlined the fact that mortgage and securities fraud
na

perpetrated by investors on Wall Street has caused the destruction to the
rie

nation‟s economy. The plaintiff has also demonstrated that the defendants
s.

have engaged in acts that violate the U.S. Constitution and the predatory
ni
ng

lending laws.
.c

b. Plaintiff Muckle is a carpenter by trade. It is indisputable that
o

homebuilding and improvement suffered severely because of the fraud in
m

the mortgage industry; if people cannot pay their mortgage how can they

pay to improve their homes? Therefore, because mortgage fraud has

92
caused the plaintiff economic loss due to the downturn in business, then

any/all foreclosure orders that are given in the country directly impacts

plaintiff Muckle, thus giving Muckle rights to sue any/all persons and/or

entities involved in the fraudulent origination, securitization, insuring,

rating, and selling of any/all mortgage loans in the country.
ht

146. The third prerequisite is redress ability. The plaintiff must adequately
tp
://

allege that a favorable result in the litigation is likely to redress the asserted
th

injury. Lujan, 504 U.S. at 561, 112 S.Ct. 2130.
e

147. At the hearing on this motion, the evidence will speak for itself; there is no
re

C olu
al

way the defendants can prevail if the evidence of mortgage fraud on a national
O
re

scale affecting all residents collectively is proven.
PY tio
v

148. In addition to these Article III prerequisites, prudential concerns ordinarily

require a plaintiff to show that his claim is premised on his own legal rights (as

opposed to those of a third party), that his claim is not merely a generalized
na

grievance, and that it falls within the zone of interests protected by the law
rie

invoked. Ramírez, 438 F.3d at 98; N.H. Right to Life Political Action Comm. v.
s.

Gardner, 99 F.3d 8, 15 (1st Cir.1996). These prudential considerations, though
ni
ng

important, are not as inexorable as their Article III counterparts. See, e.g.,
.c

United States v. AVX Corp., 962 F.2d 108, 116 (1st Cir. 1992) (recognizing
o

associational standing exception).
m

a. The plaintiff has demonstrated that, being American citizens living in

American, where the American economy is suffering as a direct result of

93
the defendants giving out “unconscionable and void” foreclosure notices.

All Americans who have an adjustable rate mortgage loan and all

Americans whose tax money is being used to bail out the investors, are

suffering collectively and individually as a direct result of mortgage fraud

which the defendants have taken no steps in stopping.
ht

149. In the underlying case in which the court used Pagán as an authority, the
tp
://

First Circuit Court found, “Pagán asserts injury in fact on the basis that
th

Calderón's meddling with ARCAM's loan request was driven by political
e

animus aimed squarely at him. This assertion is wide of the mark: the
re

C olu
al

standing inquiry turns on the plaintiff's injury, not the defendant's motive.
O
re

Thus, when a government actor discriminates against a corporation based on a
PY tio
v

protected trait of a corporate agent, it is the corporation — and only the

corporation — that has standing to seek redress. See Guides, 295 F.3d

at 1072-73 (holding that corporation alone had standing to pursue claim that
na

lease sought by corporation was denied because of employee-shareholder's
rie

race); Potthoff, 245 F.3d at 717-18 (holding that employee lacked standing to
s.

assert section 1983 claim when government agency terminated corporation's
ni
ng

lease because of employee's criticism of the mayor). In other words, the fact
.c

that animus toward the agent sparked mistreatment of the principal does not
o

create an exception to the rule that an agent's section 1983 claim can flourish
m

only if he alleges that he personally suffered a direct, nonderivative injury.4

Potthoff, 245 F.3d at 717.

94
a. In this instant case, the plaintiff states that the evidence proves that the

foreign investment firms and their American Judas counterpart‟s intent

was not just to defraud the plaintiff or the government individually, but

rather that the fraud was perpetrated against all American residents with

an adjustable rate mortgage and to all American taxpayers, including the
ht

very defendants to this suit.
tp
://

150. To be sure, there are exceptions to virtually every general rule — and
th

the rule that a shareholder cannot sue in his own name for an injury sustained
e

by the corporation is not ironclad. The case law also suggests that there may be
re

C olu
al

room for an exception if it is inconceivable that the corporation itself would
O
re

pursue a claim for the misconduct. See, e.g., Kavanaugh v. Ford Motor Co.,
PY tio
v

353 F.2d 710, 717 (7th Cir.1965)

151. The plaintiff Muckle states that this case is unique on the above issues based

on the facts of the evidence he possesses. Muckle states that it is inconceivable
na

that any other plaintiff would have the type of evidence that he has and that it
rie

is inconceivable that any other plaintiff has tied all the defendants together as
s.

the plaintiff has.
ni
ng

152. If all American residents with a subprime loan had this type of specific
.c

evidence, then the courts would have to contend with 10 million civil lawsuits,
o

with everyone demanding that their mortgages be rescinded and they be
m

granted the title to their home.

95
153. Because the government is already bailing out the investors and that the

government is using taxpayer‟s money to buy up those fraudulent adjustable

rate mortgage loans so that the investors won‟t fail, then it is inconceivable

that the government will ever pursue a case against all of the perpetrators of

the mortgage fraud; therefore, they would get away with committing mortgage
ht

fraud and robbery against the people.
tp
://

154. The plaintiff does not know of any other American resident who will file such
th

a lawsuit against the defendants to protect all American residents. Because it
e

is inconceivable that the government would initiate suit to pursue claims of
re

C olu
al

mortgage fraud against all defendants, and because it is inconceivable that any
O
re

other American will initiate filing this suit, then the American people will
PY tio
v

continue to suffer for many, many years to come not only through the loss of

about 10 million family homes, but also from the adverse impact the crisis in

our economy can have on our national security and the trillions of dollars of
na

hard earned taxpayer money that are being spent to compensate the criminals
rie

for the very fraud which they themselves perpetrated.
s.

155. Because it is inconceivable that the government or any other individual
ni
ng

resident would pursue a suit for relief for all American residents, without
.c

settling for him or herself, then the plaintiff will be uniquely affected if the
o

court fails to take action. If the plaintiff cannot use this case to seek the same
m

relief for all American residents as he seeks for himself, then even if he was to

save his own home, the fact is my next door neighbor will lose his home due to

96
mortgage fraud, which will have an adverse impact on the value of my property

and degrade my neighborhood and community, therefore causing economic loss

to my city which will in turn bear a burden on my state, which must then seek

federal aid at the cost of all taxpayers in the entire United States of America.

We are all connected by an unbreakable umbilical cord.
ht

156. Federal laws states that a criminal is not permitted to profit from his crimes,
tp
://

but because it is inconceivable that the government will take immediate and
th

direct steps to file suit against the lenders and their foreign bosses, and
e

because the lenders are actually benefitting from the taxpayer bailout, then
re

C olu
al

the culprits are profiting from their crimes of mortgage fraud.
O
re

157. Because the government has not sued all of the defendants for the fraud
PY tio
v

perpetrated against the residents of the country, then the plaintiff, as an

American resident, has a constitutional and a patriotic duty to file a citizen‟s

complaint to redress the matter.
na

158. A Great Disrespect is being perpetrated against the people, Your Honor.
rie

Imagine this bitter pill: A man wakes up and goes to work. On payday, the
s.

government takes out income taxes, social security taxes and all kinds of other
ni
ng

taxes. We are good with it because it is for the benefit of our community and
.c

country. Then on his way home, if he has to pass through a tollbooth, he is
o

taxed. When he gets home, he puts away some money for the next week‟s work
m

and he gives the balance to his woman to shop for the house. She goes to the

supermarket, she is taxed, she buys him some shoes and clothes for work, and

97
she is taxed. At month‟s end, their property is taxed, and she pays water and

sewer fees which is really a tax, along with the mortgage payment in which

there is a hidden lender‟s tax. Let us not forget the hazard insurance.

159. However, even though they pay property tax and water and sewer treatment

tax to the city, the city does nothing to maintain the property. If it snows, the
ht

people have to clean off the sidewalk or get charged a penalty, which is really a
tp
://

tax. The city does not come inside and clean or maintain the property even
th

though the people pay property tax. If they do not themselves clean the
e

property, the city can come in and clean it, or not clean it and charge a further
re

C olu
al

tax or place a lien on the property.
O
re

160. As if this great wickedness to people was not enough, thieves on Wall Street
PY tio
v

and the home mortgage industry had to milk the cow some more, so they

decided to take it a step further; why not take even that little which they have

left? So they decided rob us of our homes too. What disrespect!
na

161. Your Honor, a great man once stood up and begged the question, “Should I
rie

keep back my opinion at such a time, through fears of giving offense? I should
s.

consider myself guilty of treason towards my country and an act of disloyalty to
ni
ng

the Majesty of Heaven who I revere above all earthly kings.” What is going on
.c

in our country is an act of treason and destruction from within. I have the
o

evidence to prove that these foreign investments firms are deliberately
m

accelerating American family homes into foreclosure because if there are

individual foreclosures then it would be tedious for the investor to make a

98
claim for private mortgage insurance. However, if there are blanketed

foreclosures in a given county, then the investor can issue blanketed claims

and are compensated in bulk, instead of having to submit claims for each

individual default. The order to proceed with foreclosures is given by foreign

entities, and American conspirators carry out the process. I have the proof in
ht

writing.
tp
://

162. However, despite the plain evidence, which proves this the case, no one is
th

doing anything to stop it. Instead, the thieves are given bailouts. I wrote to
e

and called several government agencies to offer them the evidence, yet no one
re

C olu
al

cares to see it. Like Chicken Little, everybody is crying, “the sky is falling, the
O
re

sky is falling,” yet I don‟t see anyone issuing any orders to stop the robbery and
PY tio
v

the dispossession of the people. They are allowed to blatantly take us into our

own American housing court and get our own American judges to issue decrees

throwing us out into our own streets like mangy dogs.
na

163. Don‟t they call that animal cruelty? Isn‟t it unlawful to throw a dog out into
rie

the streets? Even dogs are rescued and taken to a warm shelter with a full
s.

belly and a warm place to sleep; but what of the people who lose their homes,
ni
ng

and what of them who get laid off from their jobs and those who lost their
.c

investments through what the government knows to be mortgage and
o

securities fraud? The poorest are left to wander the streets aimlessly until they
m

get weary at night and have to hurry to be the first to get a bed in a homeless

99
shelter, or to fight with the bums for that choice spot under that bridge or in

that abandoned car.

164. Lenders are allowed to unlawfully enter and dispossess, ripping up lives and

tearing families apart. All a hard working man/woman can do is band their

belly and watch helplessly as the local sheriff stands guard to protect the
ht

American agent of the foreign investor, as they slam the lock shut on our piece
tp
://

of the American Dream.
th

165. I have witnessed a great evil being wrought against the people, Sir, and
e

under no circumstance will I remain silent for fear of giving offense. How
re

C olu
al

much longer can the people accept this? How much longer are the courts
O
re

willing to bet that the people will just sit and accept this Great Disrespect?
PY tio
v

166. Must I call to mind the terrible occurrence in New York, or must I speak of

that mother who shot herself after losing her home because of the mortgage

fraud perpetrated by those who are receiving federal assistance?
na

167. Or must I invoke the memory of the AIG and Wells Fargo Bank, and the
rie

Bank of America lavishing million-dollar parties or their multi-million dollar
s.

bonuses after saying they would fail if they did not receive taxpayer‟s bailout?
ni
ng

We are being destroyed from within and no one is even taking notice.
.c

“Sometimes we are apt to shut our eyes against a painful truth, and to listen to
o

the song of the siren.” To listen to the people crying out for justice and to
m

watch them protest peacefully against the great robbery being committed

against them, until the frustration of our government‟s inactions sets in and

100
transforms us into beasts. To make us take matters into our own hands and

rebel against these foreign invaders who are robbing and dispossessing the

people. To break bank windows like they did in London, or to burn down

CEO‟s homes. We are a people robbed!

168. I make no violent threats, Your Honor. I speak only of the visible signs on
ht

the frustrated faces of the people. The people cannot take it much longer! But
tp
://

the failure to respond can only result in the people exploding like a powder keg;
th

then Wall Street will burn! But is this the part of wise men engaged in a great
e

and arduous struggle for liberty and justice? Are we disposed to be of the
re

C olu
al

number of those, who having eyes, see not, and having ears, hear not the
O
re

things which so nearly concern our temporal salvation?
PY tio
v

169. Is the court willing to continue to waive me off and be dismissive of me

because I do not write according to court‟s protocol? Is the court willing to

dismiss this motion without granting me the opportunity to present the
na

evidence at a hearing, to prove that this financial crisis was a deliberate terror
rie

act against the people of the United States of America? For my part Sir,
s.

whatever anguish of spirit it may cost, I am willing to know the whole truth, to
ni
ng

know the worst, and to provide for it.
.c

170. What is going on in our country is legalized slavery, Sir. A man can work all
o

his life and buy and pay for all his liberties, yet he owns nothing in America.
m

He buys his home and pay property taxes, yet he does not own the home nor

does he earn the property. And as if that is not a great enough evil in itself,

101
foreign investments firms are allowed to come in and continue the robbery,

then turn around and beg for bailout after they run the well dry. Every day the

bucket goes to the well, one day the bottom will drop out! What a great evil!

Capitalism is truly legalized slavery.

171. For almost two years now, I have been begging the courts to intercede and do
ht

something to stop this Great Disrespect and insult to the American people. It is
tp
://

in vain extenuating the matter any further, Sir. Gentlemen may cry, „give us
th

more bailouts, give us more bailouts, we will fix the problem!‟ But every time
e

they get bailouts, instead of modifying the loans, they just hand the taxpayers
re

C olu
al

money over to their foreign bosses.
O
re

172. This suit does not seek monetary award nor does it seek ownership of the
PY tio
v

homes. All this petition seeks are the "Cease and Desist" orders as outlined at

the beginning of this petition. If the court is then satisfied that I have made a

strong showing that cannot be rebutted, then the court must stop the abuse
na

and disrespect of the people, and ORDER the government to take all
rie

appropriate actions to remedy the matter. I would suggest confiscating them
s.

from the holders who are not entitled to recovery. If the court confiscates the
ni
ng

mortgages for the protection of the people, then instead of bailing out the
.c

criminals, the government can legally confiscate the loans and give the
o

homeowner a loan, as a way of attaching ownership to the property. It is
m

either foreign thieves or the government. I believe that the people would

102
prefer to pay the interest into the nation‟s treasury, than to pay it into a bank

in Japan, or China.

173. The government can take this unique opportunity to legally confiscate these

loans and bail out the people, or it can “buy” the unlawful loans and continue

the bailouts and aid and abet the destruction from within. In the end, I do
ht

have dual citizenship. I have a second home to run to, but I promised not to
tp
://

run until I have exhausted all remedies. After that I will just brush the dust off
th

my feet and reserve my plane ticket.
e

174. For me to sit on this evidence and not try to help my country will be an act of
re

C olu
al

treason. If the court does not grant this motion, I promise that I will blazon
O
re

this evidence across the Internet with instruction to all 10 million subprime
PY tio
v

victims on how to file an individual claim for mortgage fraud. If everyone was

to file an individual claim for mortgage fraud it will cause the total collapse of

the mortgage industry because no one would be paying their mortgages. That
na

is how powerful this evidence is.
rie

175. The battle has already begun, Sir. The next gale that sweeps from the north
s.

here in Boston will bring to our ears the clashes of 10 million civil lawsuits.
ni
ng

My brethren are already on the battlefields in New York, Florida, California,
.c

Texas, and 7 other states, all waiting for instruction from me to walk into their
o

local federal court clerk‟s office and file their revised versions of this motion.
m

We will flood the federal court in Boston with hundreds of thousands of claims

for mortgage fraud, and when the court in Boston is overflowing, we will file in

103
New York and overflow that system also, then we will move on to California,

then Texas. We will recruit consumers and taxpayers in all 50 states. We will

overwhelm the system with 10 million claims for mortgage fraud and demands

that our mortgages be rescinded and that our properties be returned to us free

and clear of all incumbencies.
ht

176. As I have been doing for the past two years, we will refuse to pay our
tp
://

mortgage, property tax or hazard insurance. We will cripple their systems and
th

stop their incomes as they have crippled our economy, and caused millions of
e

job losses. We will fight their 50-state strategies with our own 50-state
re

C olu
al

strategies. We will fight their tsunami waves of foreclosures with our tsunami
O
re

waves of civil actions.
PY tio
v

177. The people have declared “financial Armageddon” against capitalism and the

harder we have to fight for justice, the harder we will defeat them. Your Honor,

with all due respect, you have known me for almost two years and you know
na

that I am serious and will not give up. You have issued orders for my home to
rie

be foreclosed, yet despite that order, not even the defendant can carry it out. It
s.

has nothing to do with you, Sir, when I contend with you; I intend no
ni
ng

disrespect but when you give me an order that I know violates my rights, how
.c

can I as a sovereign being obey such an order? It would be a gross disrespect to
o

the Heavenly Judge who can take my house and still roast me in hell if I
m

disobey and not fight for the people. So because I chose to follow the orders of

my God and not settle and allow the defendants to go free, what man on earth

104
can take my home away from me legally and fairly? Is this the type of

situation the court wishes to cause throughout the nation? We won‟t pay our

mortgages , or taxes, or insurance.

178. I beg the court to think about the power of the evidence I have, and which I

would be more than glad to share with over 10 million homeowners with a
ht

subprime loan. I know not what course others may take, but as for me, I
tp
://

bought my home for my children. I did not steal to buy it or to pay any of the
th

fees; therefore, it will be a cold day down there before I allow anyone to take it
e

from me unlawfully.
re

C olu
al

179. Give us liberty or we will give the systems death. We will cripple the systems
O
re

with lawsuits and refusals to pay any mortgage. This is not a threat against
PY tio
v

the courts; neither do we wish the court to be collateral damage. This is a

promise to foreign investment firms who have taken illegal actions against

U.S. citizens on U.S. soil in violation of U.S. sovereign laws.
na

180. The court can choose to contend with 10 million claims for mortgage fraud, or
rie

it can do the American thing and grant the people relief in this one lawsuit.
s.

“Give us liberty and justice or we will give the system death!” That is the cry I
ni
ng

hear ringing out across the land. Whether it is in Massachusetts, or whether it
.c

is in Texas, or whether it is in Florida, or California, or wherever homeowners
o

are dispossessed and downtrodden, they shall rise with a vengeance that will
m

shake the world. And no power not by might, no power not by force of will can

still the wrath of the people‟s vengeance, only when justice overlay the land,

105
and men are free from fear and free of want. The spirit of revolution will never

bow down to man. Only when liberty reigns, when justice reigns and the

language of truth pours down like rain. When usury ceases, when corruption

ceases, then there will be nothing to fear. But until then, there is no power in

the world that can halt the people‟s quest for liberty and justice. No power in
ht

this world. None at all!
tp
://

181. The plaintiff does not seek money or fame, because I have rejected offers of
th

monetary settlements from the lenders. As the court even knows, I have told
e

the court and the defendant “even if the lenders were to offer me $100 million
re

C olu
al

to settle the case and sweep the evidence under the rug, I would not accept it.”
O
re

Therefore, the plaintiff respectfully moves the court to consider the fact that
PY tio
v

this motion is a sincere gesture by the plaintiff to helps his fellow American

residents. It is my patriotic call to duty, and I am ready to serve.
na

Wherefore, the plaintiff respectfully files this civil action seeking redress on
rie

behalf of himself and the American people as it is my patriotic duty to defend

the United States government and our fellow citizens from theft and financial
s.
ni

terrorism. It is not heroism that I seek Your Honor; it is survival for me and
ng

my brethren, including you.
.c
o

Respectfully submitted,
m

Paul L. Muckle, pro se

____________________________ ________________________________

106