IN THE UNITED STATES DISTRICT COURT EASTERN DISTRICT VIRGINIA Jeffrey Brown Plaintiff, v. HSBC Mortgage Corp.

(USA), Debra Bassett, Bierman, Geesing, and Ward, LLC, Jared Slater, and MERS (Mortgage Electronic Registration System) DOEs 1- 50 being parties to be named later Defendants ) ) ) ) ) ) ) ) ) ) ) ) ) )

AMENDED COMPLAINT

Request for Jury Demand Request for Injunctive Relief CIVIL CASE NO: 1:10cv1427

AMENDED COMPLAINT COMES NOW, Plaintiff Jeffrey Brown, Pro Se, [for the present time] and files his first Amended Complaint against Defendants. Plaintiff wishes to remind this Court that pursuant to order dated 01/24/2011 Plaintiff has obtained a default judgment against defendants HSBC and Bassett ; such rights under that default judgment are not waived nor any rights extended with this Amended Complaint. Plaintiff further states as follows: NATURE OF ACTION

This case arises out of Defendants’ egregious and ongoing and far reaching fraudulent Schemes for improper use of Plaintiff’s identity, fraud in the inducement, fraud in the Execution, usury, and breaches of contractual and

fiduciary obligations as Mortgagee or “Trustee” on the Deed of Trust, “Mortgage Brokers,” “Loan Originators,” “Loan Seller”, “Mortgage Aggregator,” “Trustee of Pooled Assets”, “Trustee or officers of Structured Investment Vehicle”, “Investment Banker”, “Trustee of Special Purpose Vehicle/Issuer of Certificates of ‘Asset-backed Certificates’”, “Seller of ‘Asset-Backed’ Certificates (shares or bonds),” “Special Servicer” and Trustee, respectively, of certain mortgage loans pooled together in a trust fund. JURISDICTION AND VENUE 1. This Court has jurisdiction over the subject matter of this action pursuant to Article III § 2, U.S. Constitution, 42 U.S.C. §§ 1983, 1985 and 1986 (failure to prevent) as conferred by the U.S. Constitution 28 U.S.C. §§ 1331 and 1343 under the 1st, 4th, 5th, 6th, 8th and 14th Amendments. This action involves Constitutional charges, grounds, questions, and jurisdiction is supplemented by 28 U.S.C. § 1367(a) and challenges the Constitutional violations of state and federal law, procedure and practice by state and federal officials and officers of this Court. Further, Plaintiff brings this action under the Real Estate Settlement Procedures Act, 12 U.S.C § 2601, et seq., The Federal Truth in Lending Act 15 U.S.C. §1601 et seq., Regulation Z, § 226.2(11) and Act 15 U.S.C. § 1692, Fair Debt and Collection Practices Act. Plaintiff also brings this main action through civil RICO statute. 2. This action is brought within the time constraints of 42 U.S.C. § 1983 and particularly under the continuing organization complicity and fraud scope, central to this Complaint. 3. Plaintiff requests an Administrative Judge to preside over this matter so

that Plaintiff may exhaust all of his administrative remedies. 4. Venue is proper under of 28 U.S.C. § 1391 because the parties are either residents of the State of Virginia and the United States, or Corporations under the personal jurisdiction of the State of Virginia. PARTIES 5. Plaintiff Jeffrey Brown is a citizen of the United States and a resident of Fairfax, Virginia. Plaintiff is a “consumer” and “natural person” for the purpose of this Complaint within the meaning of The Federal Truth in Lending Act 15 U.S.C. §1601 et seq., Regulation Z, § 226.2(11) and Act 15 U.S.C. § 1692, Fair Debt and Collection Practices Act. 6. Defendant HSBC Mortgage Corporation (USA)(hereinafter “HSBC”) is the nominal lender and originator of the loan. HSBC was, at all material times hereto, a foreign corporation which was doing business in the State of Virginia including the servicing of mortgage loans which in this instance, further constituted the collection of consumer debts subject to the provisions of the Federal Truth in Lending Act 15 U.S.C. §1602(f) and the Fair Debt and Collection Practices Act 15 U.S.C. §1692a and is a “creditor and collector” as defined. 7. Defendant Bierman, Geesing and Ward, LLC (“ hereinafter Bierman & Geesing”) is a “Collector” as defined under Fair Debt and Collection Practices Act and is engaged in regular practice and collection of consumer debts pursuant to 15 U.S.C. §1692. Defendant is thus subject to the provisions of a “collector and creditor” as defined by the Federal Truth in Lending Act 15 U.S.C. §1602(f). Upon information and belief, Howard

Bierman is a principal in both Beirman & Geesing and Equity Trustees, LLC. 8. Mortgage Electronic Registration System (hereinafter “MERS”), with its last known principal place of business at 1818 Library Street, Suite 300, Reston, VA 20190, is and was, at all times material hereto, a corporation which was engaged in the business of, inter alia, acting as an alleged “nominee” for various mortgage lenders and their servicing agents for purposes of purporting to assign various rights incident to a mortgage Note and/or a mortgage to third parties.

9. 10.

Debra Bassett is the original trustee listed on Plaintiff’s Deed of Trust. Upon information and belief, Jared Slater is employed with Equity Trustee, LLC, a firm owned by Howard Bierman of the Bierman & Geesing.

11.

Plaintiff is ignorant of the true names and capacities of Defendants sued herein as DOEs 1- 50, inclusive, and therefore brings suit against these Defendants by such fictitious names. Plaintiff will amend this Complaint to allege their true names as ascertained. FACTUAL ALLEGATIONS

12.

In late 2009, Plaintiff and his wife performed a routine audit of their various personal documents and discovered that they had never received a complete alleged loan package after closing with HSBC, in 2008. More specifically, a copy of the original loan application, a copy of the Note itself, rescission documents, and a complete Deed of Trust were either lacking or missing. In fact, all that Plaintiff received at the so-called “closing” table

was a six-page copy of the alleged Note and a five-page copy of the Deed of Trust. (See Exhibit A – DOT received at closing). 13. In 2010, Plaintiff requested all documents related to the alleged loan package from Defendant HSBC. However, HSBC failed to provide such documents – in violation of RESPA, TILA and U.S.C. Title 18, Part I, Chapter 25, § 472, 473, 474, 474A, and 475 – and instead, only sent a copy of the alleged adjustable rate note. HSBC failed to provide any other closing documentation. 14. Plaintiff noticed that the “Note” received was different from the copy already in Plaintiff’s possession. This version contained an extra page with an inverted notary impression and a curiously blank space that appeared to be redacted. (See Exhibit B – Loan Documents received from HSBC). 15. In response to HSBC’s lack of a substantive reply, Plaintiff then called Premier Relationship Manager, Soraya Teymourian to express concern. Plaintiff followed up the call with a letter to Ms. Teymourian requesting the opportunity to view the ORIGINAL complete set of alleged loan documents. (See Exhibit C- January 27, 2010 letter to HSBC Bank). 16. On January 29, 2010, Plaintiff went to the Fairfax County Land Records to obtain a true and certified copy of the Deed of Trust. (See Exhibit D). Such document was 19 pages long and in no way resembled the five page Deed of Trust Plaintiff received at closing. (Compare Exhibit B with Exhibit D). 17. On February 4, 2010, in response to Plaintiff’s repeated requests, Plaintiff

received a phone call from Goli Youchidge from HSBC. She indicated that she was not sure if the original documents existed, but that she would attempt to locate them. (See Exhibit E). 18. On February 17, 2010, Plaintiff actually went to an HSBC Bank in Virginia where he was able to view what was described as “original” loan documents. (See Exhibit E). This document did not match the “official copy” as sent to Plaintiff via FedEx on January 27, 2010. Further, Plaintiff disputes that this so called “original” was not an original at all, as signing of the document was done in blue ink. The document as provided had a black signature. 19. As a result of this visit Plaintiff realized that HSBC was not the holder of the original note as all it could produce for Plaintiff’s viewing was a photocopy alleged to be the “original” Note. By their own admission and on several occasions, HSBC no longer held an alleged Note or even a proper Deed of Trust. 20. On February 17, 2010, Plaintiff Noticed HSBC, Debra Bassett (Trustee), MERS, and various government agencies with a Qualified Written Request (“QWR”) as per TILA and RESPA.[1] (See Exhibit F (containing sub-exhibits)). 21. On February 24, 2010, in response to the QWR, Plaintiff received a letter from HSBC containing unsubstantiated claims. (See Exhibit G). HSBC falsely claimed that Plaintiff had received the following: • • A copy of the Mortgage Note, (Un-endorsed) The Deed of Trust,

• • •

The Truth in Lending Statement, The HUD-1 Statement, and Funding details from the file.

In truth, Plaintiff received from HSBC only the edited version of the alleged Note, and at closing was given an incomplete version of the Deed of Trust. 22. Defendant HSBC has therefore violated RESPA by their failure to acknowledge Plaintiff’s request for information and also by failure to resolve the issues within 60 business days. 23. Additionally, neither Debra Bassett, Trustee, nor MERS responded to the QWR placing both of them in violation of RESPA. 24. Because of Defendants’ non-response to the QWR, Plaintiff provided Defendants HSBC and Basset with Notice of Revocation of Power of Attorney and Notice of Appointment of Successor Trustee[2].[3] (See Exhibit H). 25. On May 17, 2010, Plaintiff received a loan default notice. (See Exhibit J). Such letter failed to reference any of the claims as made by Plaintiff or to include any of the documents as requested. 26. On May 20, 2010, Plaintiff posted multiple Notices in the Fairfax Times. (See Exhibit K). 27. In a letter dated June 3, 2010, HSBC stated that Plaintiff was in default. (See Exhibit L). In response, Plaintiff sent another request for debt validation. This was directed to HSBC officer and Director, Stephen Tich. (See Exhibit M). 28. In response to Exhibit M, HSBC sent another copy of the alleged Note.

(See Exhibit N). With this response on June 25, 2010, HSBC claimed that it shipped the loan file “which contained the original signed loan documents” to the McLean branch. However, as stated above, Plaintiff alleges that the file viewed at the Mclean branch was not the original signed note. Therefore, by its own admission, HSBC has admitted that it does not have the original signed note as it was not able to produce the wet ink signature for viewing. In essence, HSBC cannot verify Plaintiff’s obligation on the note as they don’t have the original note[4]. 29. Plaintiff created a “good faith” account wherein he placed his monthly payments for the duration of this controversy. On June 12, 2010 Plaintiff moved this account from HSBC to an account at Bank of America. (See Exhibit O). Such move was precipitated by a fear that HSBC would empty this account in a self-help maneuver. 30. After several attempts to validate any debt with HSBC, Plaintiff sent Stephen Tich Notice of Acquiescence to Plaintiff’s claims as caused by Defendant’s non-compliance. (See Exhibit P). Such letter contained a Contract Novation under which the “alleged debt is now void, this matter is closed and the Mortgage Account Number 459779-6 is discharged and satisfied.” (See Id.). 31. In addition to not being able to validate the debt by providing the original note, Plaintiff also alleges that at the time of closing, Plaintiff thought that he was signing a Promissory Note in return for a negotiable instrument obligation. However, the real transaction was that Plaintiff signed a note

that was converted into a “BOND” and then sold to various investors unbeknownst to Plaintiff.[5] The Plaintiff was not a part of the “Bond” deal, however, Plaintiff’s identity and other personal information was used to make millions of dollars in profit by the securitization of the note without Plaintiff’s knowledge, consent and permission. Without Plaintiff’s signature, the Bond deal couldn’t take place. 32. In essence, the real transaction was as follows: Wells Fargo Asset Securities Corporation, the depositor hired HSBC Bank USA, National Association to manage a Trust. In the Pooling and Servicing Agreement (hereinafter “PSA”) filed before the SEC as Exhibit 4.1 of the 8K report, the securitization partners admit that Plaintiff’s loan was sold to various parties. [6] 33. As per the securitization documents filed, the “True Sale” occurred from the Depositor, Wells Asset Securities, to the Securities underwriter, Lehman Brothers Special Financing Inc. and Lehman Brothers Inc. The Trustee, “HSBC Bank USA, National Association” in this case was not involved in sale of the Plaintiff’s note, but was simply an administrator. 34. Further, the Trust that allegedly “owns” Plaintiff’s note and purportedly forms the basis by which a foreclosure was attempted has been dissolved. Therefore the trust is no more, and as such, HSBC Bank USA, National Association” is no more a trustee of Wells Fargo Mortgage Backed Securities 2008-AR2 Trust. The triggering event that caused the trust to dissolve is the Credit Default Swaps, AIG Bail out and insurance proceeds. See also f.n.2.

35.

Moreover, neither the “original’ note that Plaintiff allegedly saw on January 17, 2010, nor any other version or copy of the Plaintiff’s note produced by any Defendants had the proper endorsements and chain of title included.

36.

According to the transfer of ownership of Plaintiff’s note as fully described in the associated securitization documents, there should be at least 8 or more endorsements showing each transfer on Plaintiff’s note. However, the Plaintiff’s note contains none.[7]

37.

On August 25, 2010, Plaintiff received a Notice of Intent to Foreclose. (See Exhibit Q).

38.

The nominal lender HSBC Mortgage Corporation sold Plaintiff’s loan for cash to Wells Fargo Bank NA, who sold it to Wells Asset Securities, who in turn sold it to Lehman brothers Special Financing Inc. for cash. Nevertheless, on September 8, 2010, Plaintiff received correspondence from Defendant Bierman & Geesing stating that HSBC Mortgage Corporation is the secured party on Plaintiff’s note that has directed Equity Trustees to institute a foreclosure. See f.n. 8 & Exhibit R.

39.

In this fraudulent and faulty letter Bierman & Geesing falsely refers to HSBC as the secured party. Had they been in possession of the Deed of Trust, they would have noted that the beneficiary of the Deed is MERS. (See Exhibit D). Further, Bierman & Geesing states that Plaintiff’s Note is missing. See Exhibit R.

40.

Pursuant to being threatened with an attempted fraudulent foreclosure sale by either Bierman & Geesing or Equity Trustees, Plaintiff checked the Land Records for Fairfax County.

41.

As of October 12, 2010, two days prior to the attempted sale of Plaintiff’s property, there was no transfer[8] of Trustee status recorded. (See Exhibit S- a certified copy of Land Records showing NO Activity for the past two years.)

42.

This fraudulent activity is in direct violation of Virginia Code § 55-59.1 (Notices required). In fact, Defendants did not record their fraudulent appointment (conveniently backdated) of substitute trustee until October 18, 2010, nor did they bother to notify the Plaintiff of their fraudulent substitution – in violation of VA code § 26-50, and 8.01-428(A)(i).

43.

Upon information and belief HSBC never “loaned” any money at all. Instead HSBC credited/deposited the Promissory Note signed by Plaintiff, used that deposit to pay the seller, and continued to use Plaintiff’s good name and credit for its own profit and criminal enterprise.

44.

Additionally, research by Plaintiff indicates that the original loan application now has a CUSIP number attached to it. Such number strongly suggests that the loan has been illegally converted to an instrument to purchase a bond, and such bond was then used to obtain a loan from the government to pass through money to buy real property.

45.

If such allegations prove true, then any remaining loan is actually with the

government, not HSBC. 46. Such action by HSBC constitutes a fraudulent conversion of an application to an instrument. 47. All the listed Defendants were involved in a joint venture in furtherance of making substantial profits for themselves using Plaintiff’s signature, credit score, and other information without disclosing these facts to the Plaintiff. While Plaintiff thought he was getting a simple loan, his information was actually being used to finance a very complex securities deal with defendants forming relationships as further described in the PSA of the alleged trust purportedly holding Plaintiff’s Note. The Defendants formed a joint venture for their own profit much before Plaintiff even applied for the loan. 48. The Joint Venture formed by all the known and unknown Defendants illegally and improperly securitized Plaintiff’s note by disregarding the terms of PSA itself and disregarding proper securitization procedures in an attempt to evade paying taxes. Among other illegalities, Plaintiff’s note was not properly endorsed or correctly transferred to the REMIC[9] trustee. COUNT I CIVIL FRAUD (Bierman, Geesing & Ward and Slater) 49. Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein. 50. Plaintiff alleges that Bierman & Geesing and Slater knowingly made false

representations of material fact with the intent to mislead Plaintiff, and that such justified reliance resulted in damage to Plaintiff. 51. As referenced above, Defendant Bierman & Geesing sent Plaintiff a letter received on or after September 8, 2010. (See Exhibit R). In this communication Bierman & Geesing falsely states that HSBC is the secured party. This is a false representation as the beneficiary of the Deed of Trust is MERS not HSBC as Bierman & Geesing states in that letter. (See Exhibit D). 52. Bierman & Geesing also fraudulently prepared the substitution of trustee documents sometime on or about September 15, 2010. See Exhibit “T”- a fraudulent trustee substitution. 53. Further, Defendants have referenced §§ 55-59.1 (B) of the Virginia Code. At the top of the correspondence it states that they are a “debt collector” while at the bottom they declare themselves “Attorneys for the Secured Party.” 54. As such, Defendants have fraudulently represented themselves as debt collectors, Substitute Trustees and legal counsel. Such an obvious attempt to clothe themselves in authority can only demonstrate underhanded dealing with the Plaintiff. 55. Such representations by Defendants demonstrate an expectation that Plaintiff should rely on such representations and cause him to act in a manner that was detrimental to his interests thereby causing injury. 56. Defendant is not deserving of any sympathy or benefit of the doubt.

57.

Plaintiff has done further research and has determined that the aforementioned fraud committed by Bierman & Geesing and/or Equity Trustees is not a singular incident. (See Exhibit U). Bierman & Geesing has been found to engage in fabrication of signatures, fabrication of documents, notary misconduct, etc.

58.

Because of the deceptive practice of the Bierman & Geesing law firm, the Maryland Court of Appeals has changed how foreclosure cases must be handled, and provides for independent verification of foreclosure documents. (See Exhibit V). Plaintiff believes that his documents evidencing such fraud have identified examples of fraud in the exhibits before this Court. COUNT II CIVIL FRAUD (HSBC Mortgage Corporation (USA) ,MERS, & Debra Bassett,

59.

Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein.

60.

Plaintiff alleges that HSBC directly and through its joint venture and/or agency relationship with all other Defendants knowingly made false representations of material fact with the intent to mislead Plaintiff and that such justified reliance resulted in damage to Plaintiff. See for example -Exhibit A, E, G, & N. The following are the fraudulent statements made: • On January 26, 2010, Latoya Crosby of HSBC Mortgage Corp USA sent a correspondence where she alleged

that she “enclosed a copy of [the] loan documents.” However, in truth she only sent a copy of the alleged “original note” and apparently mistakenly included a cropped off allonge page. Further, what she claims is the “original note” was not the original note as per Plaintiff’s viewing on February 17, 2010. See Exhibit E. • On February 24, 2010, LaToya Crosby again sent a correspondence where she claimed to have sent copies of note, DOT, TILDS, HUD-1, and Funding Details from Plaintiff’s loan file. In truth, Plaintiff only received the note from her and not any of the other listed documents. • On June 25, “S. Cox” of HSBC indicated that Plaintiff’s loan file containing original signed loan documents was sent to the local branch of HSBC. And S. Cox further states that on February 17, 2010, that Plaintiff viewed “original signed” loan documents. However, as stated in Exhibit E, Plaintiff saw only a four page copy of the alleged note which clearly was a photocopy and NOT the original. Further, there were no other documents offered for viewing that day. 61. Defendants have used their superior knowledge of the Federal Reserve Banking system to deceive Plaintiff. 62. Plaintiff alleges that nominal lenders, and HSBC, deceived borrowers, including Plaintiff to render monthly installments to their mortgage servicer

in payment of a fictitious and imaginary loan. (See Exhibit W). 63. Plaintiff also believes, based on attached affidavits and other testimony that the alleged Note, Application, etc. were all fraudulently monetized without the knowledge of the Plaintiff. 64. Because of the fraudulent nature of the Action, Plaintiff is led to believe that he is still the original and only holder in due course. 65. Absent any proof or presentment of original wet ink signature promissory note or loan contract Defendants have no right to attempt to foreclose upon the Title to Plaintiff’s real property. 66. Further, even as HSBC knows or should know that the Wells Fargo Mortgage Backed Securities 2008-AR2 Trust is dissolved, it continued to foreclose under its false authority. [10] A trigger even followed as a result of credit default swaps payments and the trust was dissolved; a) No payments are owed to any certificate holders (Tranches) or synthetic security holders (derivatives) b) HSBC created fabricated document to enroll Plaintiff’s mortgage in a Trust after dissolution of the TRUST. c) HSBC created fabricated documents to allow Trustee’s duty to continue for a Trust for which “TRUSTEE’S DUTIES” have been TERMINATED. d) Currently no distribution to certificate holders, even for the “CURRENTLY PAYING MORTGAGES”.

e)

Payments are not being directed to the original designated trust, “Wells Fargo Mortgage Backed Securities 2008-AR2 Trust” in Plaintiff’s case, because the trigger event and payments of credit default swaps, insurance proceeds, caused its demise.

f)

Since Trust has been dissolved and HSBC Bank USA, National Association is no more Trustee, has acted wrongly in regard to the issue at hand and now acting without any standing.

COUNT III FAILURE TO PROVIDE PROOF OF STANDING TO FORECLOSE (Defendants HSBC, MERS , Beirman & Geesing, and Slater ) 67. Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein. 68. Around January 2010, February 17, 2010 and March 10, 2010, the Plaintiff requested that HSBC provide clarification as to who owned and held the subject Promissory Note and the Security Deed (“Deed of Trust” or “DOT”). Such clarification would require that the purported holder of the Note produce the original Promissory Note, with the Plaintiff’s original signatures and proof of the chain of title. Such information was not provided. 69. Defendants had an understanding that the underlying debt obligation created by Plaintiff’s loan would be immediately packaged and sold, to investors on a secondary mortgage market as Mortgage Backed Securities (“MBS”)1 and as Collateralized Mortgage Obligations (“CMO”)2, through the creation of a Special Purpose Entity (“SPE”)3. 70. Despite knowing full well that Plaintiff’s note has been sold multiple times

and the trust allegedly holding Plaintiff’s note had terminated, Defendants continued to proceed with a wrongful foreclosure having no legal rights to the action to cause Plaintiff injury. 71. Since HSBC has sold the note; they cannot foreclose as they are not the holder or the holder in due course. HSBS had already sold what they had some time, and admitted under sworn statement on S-3 Registration Form, FAs-95 and Balance Sheets. 72. HSBC has been unable to provide evidence that validates the debt. It is undisputed that the named lender on the loan documents has been paid in full, plus a fee for standing in for the undisclosed lender, and that the note was negotiated despite the fact that it was non-negotiable. 73. Upon information and belief, the mortgage note has been paid in whole or in part by one or more undisclosed third party(ies) who, prior to or contemporaneously with the closing on the “loan”, paid the originating lender in exchange for certain unrecorded rights to the revenues arising out of the loan documents. To the extent that Defendants have been paid on the underlying obligation or have no legal interest therein or in the note or mortgage, or do not have lawful possession of the note or mortgage, Defendant’s allegations of possession and capacity to institute foreclosure constitute a fraud upon the court and a violation of the rights of Plaintiff to enjoyment of his property. 74. Plaintiff alleges that Defendants, and each of them, have represented to Plaintiff and to third parties that they were the owner of the Trust Deed and Note as either the Trustee or the Beneficiary regarding Plaintiff’s real

property. 75. Plaintiff’s reliance was justified based upon the position and false representations of Defendants. 76. Plaintiff alleges that Defendants, and each of them, knew at the time they made these representations to Plaintiff that they were untrue and were attempting to foreclose on Plaintiff’s Trust Deed and Note that they had no right to do so. 77. All the listed Defendants acted in a joint venture or an agency relationship to attempt to foreclose on Plaintiff’s note when none of them owned or had actual control of Plaintiff’s alleged debt. COUNT IV CIVIL RICO HSBC Mortgage Corp. (USA), MERS, Debra Bassett, Bierman, Geesing, and Ward, LLC, and Jared Slater.

78.

Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein.

79.

By Virginia Code 8.1A-103, Plaintiff now brings forward various UCC violations pertaining to mail fraud, bank fraud, securities fraud, and RICO.

80.

Plaintiff alleges that Defendant’s conduct in direct violation of U.S.C. § 1962(c) was part of a pattern of continuous criminal violations and “racketeering” activity. Plaintiff further alleges injury in his business or property “by reason of” a violation of RICO’s substantive provisions.

81.

Racketeering includes the act of operating an illegal business or scheme

in order to make a profit, perpetrated by a structured group. Racketeering encompasses many criminal acts. It includes theft and fraud against businesses or individuals. 82. Defendants are in direct violation of such statute by perpetrating continuity of schemes of fraud against the Plaintiff and others as evidenced by Exhibit U, the U.S. Bankruptcy Court, Southern District of New York, Adv.Pro.No. 08-01789 SIPA. 83. The Defendants scheme to defraud violates mail and wire fraud statutes 18 U.S.C. §§1341, 1343m by mailing copies of loan documents and making fraudulent statements as to who the Trustee is or was by making false reference to the Deed of Trust which they apparently have never seen 84. In addition, the Hobbs Act applies wherein Defendants are using “color of official right” to attempt to steal Plaintiff’s property, and under “color of law” conspire to extort property from Plaintiff knowing full well that there is no Note and, and thus no obligation. Plaintiff has indeed lost substantial amounts of money in defense of Plaintiff’s property while Defendants continue their assault and attempt to extort what is not theirs to begin with. 85. Such violations are punishable by treble damages and an award of attorneys’ fees. 86. Defendants are “persons” making conspiracy in committing the corrupt activities by selling unregistered securities. This is called money laundering or RICO. Since Defendants in a joint venture are selling unregistered

securities consisting of Plaintiff mortgage, Plaintiff is also entitled to setoff to settle the claim. Plaintiff has a right to restitution and rescission as Defendants have sold the unregistered security, because the note is not a registered security. The note is a non-negotiable instrument. When the defendants converted it into a security, UCC Article 3 no longer applies, rather UCC Article 4 does because it has been deposited in a bank. But eventually after it has gone into an SPV, and been securitized, UCC Article 8 applies and Article 9 is applicable to the remedy. 87. The subject conspiracy has existed from date of Plaintiff’s application to get a loan and continues to the present. 88. Defendants’ actions and use of multiple corporate entities, multiple parties, and concerted and predetermined acts and conduct specifically designed to defraud Plaintiff constitutes an “enterprise”, with the aim and objective of the enterprise being to perpetrate a fraud upon the Plaintiff through the use of intentional nondisclosure, material misrepresentation, and creation of fraudulent loan documents. 89. 90. Each of the Defendants is an “enterprise Defendant.” As a direct and proximate result of the actions of the Defendants Plaintiff have and continue to suffer damages. COUNT V VIOLATION OF OF TILA, REG. Z, RESPA, REG. X AND FDCPA BY DEFENDANT’S FALSE STATEMENTS, FAILURE TO DISCLOSE, AND VIOLATIONS (HSBC Mortgage Corp.(USA), MERS, Debra Bassett, Bierman & Geesing, and Jared Slater.

91.

Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein.

92.

Plaintiff alleges that all Defendants involved, in a joint and concerted effort engaged in unfair and deceptive practices in connection with the extension of consumer credit to purchase the Property, as follows: A. Violation of tila and reg. z

93.

In accordance with 15 U.S.C. § 1601, et seq. (“TILA”) and 12 CFR § 226 (“Reg. Z”) the closed-end real estate transactions at issue were made with a “creditor;” incurred a “finance charge;” were payable in more than four (4) installments; and were secured by Plaintiff’s principal dwelling. As such, the real estate transaction herein at issue is subject to the provisions of TILA and Reg. Z.

94.

Transactions that fall under the purview of TILA and Reg. Z must make certain pre-disclosures which truthfully disclose and explain the following: a. b. c. d. e. f. g. h. i. j. k. l. m. n. o. p. the name of all creditors in the transaction; the amount financed and itemization of the amount financed; the finance charge; the annual percentage rate; the maximum interest rate in variable rate transactions; the Truth in Lending disclosure statement (“TILDS”); the consumer’s handbook and loan program disclosures; the payment schedule; the total number of payments and total sales price; the right of rescission; prepayment options and penalties; late payment consequences; security interest acquired and by whom; insurance and debt cancellation coverage; certain security interest charges; and Required deposits.

95.

To date, Defendant HSBC and others have failed to properly provide

Plaintiff with some or all of the pre-disclosures as required by TILA and Reg. Z. Not only have Defendants failed to provide Plaintiff information, but HSBC has actively provided false information so that Plaintiff would remain ignorant about the true ownership of his loan. 96. Defendants failed to include and disclose certain charges in the finance charge shown on the TIL statement, which charges were imposed on Plaintiff incident to the extension of credit to the Plaintiff and were required to be disclosed pursuant to 15 USC § 1605 and Regulation Z, sec. 226.4, thus resulting in an improper disclosure of finance charges in violation of 15 USC sec. 1601 et seq., Regulation Z sec. 226.18(d). Such undisclosed charges include a sum identified on the Settlement Statement listing the amount financed which is different from the sum listed on the original Note. 97. By calculating the annual percentage rate (“APR”) based upon improperly calculated and disclosed amounts, Defendants are in violation of 15 USC sec. 1601 et seq., Regulation Z sec. 226.18(c), 18(d), and 22. 98. Defendants’ failure to provide the required disclosures provides Plaintiff with the right to rescind the transaction, and Plaintiff, through this public Complaint which is intended to be construed, for purposes of this claim, as a formal Notice of Rescission, hereby elect to rescind the transaction. B. 99. violation of respa, and reg. x

As mortgage lenders, Defendants are subject to the provisions of the Real Estate Settlement Procedures Act (“RESPA”), 12 USC sec. 2601 et seq.

100.

In violation of 12 USC sec. 2607 and in connection with the mortgage loan to Plaintiff, Defendants accepted charges for the rendering of real estate

services which were in fact charges for other than services actually performed. 101. As a result of the Defendants’ violations of RESPA, Defendants are liable to Plaintiff in an amount equal to three (3) times the amount of charges paid by Plaintiff for “settlement services” pursuant to 12 USC sec. 2607 (d)(2). 102. As a “lender,” “creditor,” or “mortgage broker” of a federally related mortgage loan, Defendant HSBC is subject to the provisions of RESPA, 12 USC § 2601, et seq. and 24 C.F.R. §3500 of Reg. X. 103. On or before the date of settlement, Plaintiff was not provided with, and did not receive proper pre-disclosure statements as required under RESPA and Reg. X, as follows: a. Pre-disclosure requirements under 12 U.S.C. § 2606 and 24 C.F.R § 3500.14 were violated because the required pre-disclosure statements were not provided to Plaintiff within three business days after the URLA was received or prepared. Thus, Plaintiff was wrongfully denied any opportunity to inspect the projected costs associated with closing; and b. Accepted charges for the rendering of real estate “settlement services” which were, in fact, charges for other than services actually performed were not properly disclosed to Plaintiff. Such undisclosed charges in the settlement statements are in violation of RESPA and Reg. X. 104. Because Plaintiff was not provided with necessary RESPA pre-disclosures,

the aforementioned charges are fees, kickbacks, or other things of value in connection with “settlement services” that were not actually performed in accordance with 24 C.F.R. §3500.14(b). 105. Further, in violation of RESPA, Defendants have failed to respond to Plaintiff’s Qualified Written Request within the appropriate time period and have failed to provide documents as requested. c. violation of FAIR DEBT COLLECTIONS PRACTICE ACT (“FDCPA”) and FEDERAL CREDIT REPORTING ACT (“FCRA”) 106. At all times material, Defendants qualified as a provider of information to the Credit Reporting Agencies, including but not limited to Experian, Equifax, and Trans Union, under the Federal Fair Credit Reporting Act. 65. Defendants wrongfully, improperly, and illegally reported negative information as to the Plaintiff to one or more Credit Reporting Agencies, resulting in Plaintiff having negative information on their credit reports and the lowering of their FICO scores. (Plaintiff has already filed a report with the credit agencies asking for an investigation into this matter) 107. The negative information included but was not limited to an excessive amount of debt into which Plaintiff was tricked and deceived into signing, and that Plaintiff owed the debt to HSBC, an entity that did not verify or validate the debt despite numerous requests from Plaintiff to do so. 108. Notwithstanding the above, Plaintiff has paid each and every payment on time from the time of the loan closing through the time Plaintiff disputed the validity of the debt but received no validation of the debt allegedly owed to

HSBC. As stated, Plaintiff has continued to make payment into an escrow account for the true creditor of Plaintiff’s loan when ascertained. 109. Pursuant to 15 USC sec. 1681(s)(2)(b), Plaintiff is entitled to maintain a private cause of action against Defendants for an award of damages in an amount to be proven at the time of trial for all violations of the Fair Credit Reporting Act which caused actual damages to Plaintiff, including emotional distress and humiliation. 110. Plaintiff is entitled to recover damages from Defendants for negligent noncompliance with the Fair Credit Reporting Act pursuant to 15 USC sec. 1681(o). 111. Plaintiff is also entitled to an award of punitive damages against Defendants for their willful noncompliance with the Fair Credit Reporting Act pursuant to 15 USC sec. 1681(n)(a)(2) in an amount to be proven at time of trial. 112. Defendants also violated FDCPA in one or more of the following: a. Falsely representing the character, amount and status of the alleged debt in violation 15 U.S.C. § 1692c(a)(1);

b. Using a false, deceptive or misleading representation or means in connection with the collection of the alleged debt, in violation of 15 U.S.C. § 1692e(10); c. Continuing collection activities without providing verification of the debt to Plaintiff after they requested verification of the debt in writing, in violation of 15 U.S.C § 1692g(b);

d. Falsely representing the character, amount and status of the alleged debt in violation of 15 U.S.C.§ 1692e(2)(A); e. By acting in an otherwise deceptive, unfair and unconscionable manner and failing to comply with FDCPA.

113.

In doing, or failing to do, the acts herein alleged, Defendants acted with oppression, malice, fraud, and with disregard for harm to Plaintiff. Plaintiff has suffered and continues to suffer humiliation, embarrassment, mental anguish and emotional distress.

114.

WHEREFORE, Plaintiff demands judgment against Defendants for all actual compensatory damages suffered, statutory and punitive damages, and all reasonable attorneys’ fees, witness fees, court costs, and other litigation costs incurred by Plaintiff and any other relief deemed appropriate by this Honorable Court. COUNT VI SLANDER OF TITLE (HSBC, MERS and Bierman & Geesing)

115.

Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein.

116.

The negotiable instruments for Plaintiff’s loan are not enforceable because the note was securitized and, therefore, is subject to and governed by a Pooling and Servicing Agreement (“PSA”). When a mortgage note is “pooled” with other similar debt obligations and then securitized, the newly pooled note then becomes serviced by another entity as required by the PSA. The pooling servicer must service the note in a manner that complies with the PSA, which constitutes “another record” that the original note is subject to or governed by. If the note is not enforceable because it is not an “unconditional promise to pay”, none of the Defendants nor agents of the Defendants can be considered persons entitled to enforce, holders, or

holders in due course in connection with the negotiable instruments in connection with the Loans to Plaintiff. 117. The purpose of MERS was to help in the securitization process. Basically, MERS directed defaulting mortgages to the appropriate tranches of mortgage bonds. MERS was essentially the operating table where the digitized mortgage notes were sliced and diced and rearranged so as to create the Mortgage Backed Securities. [11] 118. However, legally MERS didn’t hold any mortgage note: The true owner of the mortgage notes should have been the REMIC’s. But the REMIC’s didn’t own the note either, because of a fluke of the ratings agencies: The REMIC’s had to be “bankruptcy remote”, in order to get the precious ratings needed to peddle Mortgage Backed Securities to institutional investors. So, somewhere between the REMIC’s and the MERS, the chain of title was broken.[12] 119. By selling the Note without Plaintiff’ knowledge or consent through securitization trusts, Defendant HSBC irreparably damaged Plaintiff’s title to the Property and such cloud on his title makes it impossible for Plaintiff to sell the Property with a clean title until the Court determines the Deed of Trust and related filings against the Property are no longer valid and orders them removed. 120. Upon information and belief, Defendant Bierman & Geesing has filed false documents against Plaintiff’s Property in Fairfax County land records that Bierman & Geesing knew or should have known to contain false[13]

statements as to the owner of the Note and the beneficial owner of the DOT. (See Exhibit “T”) As such, Defendant Bierman & Geesing has slandered title to Plaintiff’s property making it impossible for Plaintiff to sell the Property with a clean title until the Court determines the DOT and related filings against the Property are invalid and orders them removed. 121. Plaintiff’s note contains MERS on the DOT, as such there is an immediate and fatal flaw in title, making the mortgage unenforceable. When the mortgage is unenforceable the foreclosure is void and a cloud on title exists in the presence of the court judgment to the contrary. [14] 122. MERS act of assigning the mortgage instrument is invalid as it held no beneficial interest in the mortgage instrument for two reasons: 1) a security instrument, apart from the promissory note giving rise to the debt has no value because there is no debt by which it secures payment; and 2) MERS had no beneficial interest in the mortgage instrument that it could assign. [15] 123. WHEREFORE, Plaintiff demands judgment jointly and severally, against Defendants for compensatory damages in the amount of the Note, the interest and fees paid to date on the same, plus punitive damages and interest, costs, and reasonable attorneys’ fees. COUNT VII UNJUST ENRICHMENT DEFENDANTS HSBC Mortgage Corp. (USA), MERS, and Bierman & Geesing 124. Plaintiff incorporates by reference the allegations in previous paragraphs

of this Complaint as if fully set forth herein. 125. Defendants had an implied contract with the Plaintiff to ensure that Plaintiff understood all fees which would be paid to the Defendants, to obtain credit on Plaintiff’ behalf, and to not charge any fees which were not related to the settlement of the loan and without full disclosure to Plaintiff. 126. Defendants cannot, in good conscience and equity, retain the benefits from their actions of charging a higher interest rate, fees, rebates, kickbacks, profits (including but not limited to from resale of mortgages and notes using Plaintiff’s identity, credit score and reputation without consent, right, justification or excuse as part of an illegal enterprise scheme) and gains and YSP (Yield Spread Premium) fee unrelated to the settlement services provided at closing. 127. Defendants have been unjustly enriched at the expense of the Plaintiff, and maintenance of the enrichment would be contrary to principles of equity. 128. Defendants have also been additionally enriched through the receipt of PAYMENT from third parties including but not limited to investors, insurers, other borrowers, the United States Department of the Treasury, the United States Federal Reserve, and Federal bail- out from the tax payer money. 129. Defendants have also additionally enriched themselves by double dipping when they sold the toxic assets to Maiden Lane I, II & III[16] after AIG Bailout and fraudulently foreclosing the people’s homes including the Plaintiff when

they knew the Defendants are not the owners of these properties. Defendants do not own the loan, yet continue to attempt collection and/or foreclose on Plaintiff’s home. 130. WHEREFORE Plaintiff thus demands restitution from the Defendants in the form of actual damages, exemplary damages, and attorneys’ fees. COUNT-VIII CIVIL CONSPIRACY (as against all DEFENDANTS) 131. Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein. 132. All listed Defendants acted together in a combined and concerted effort to achieve a preconceived plan to induce Plaintiff to enter into a securities transaction, the details of which were intentionally concealed from Plaintiff, in violation of law. 133. Upon information and belief, Defendants had an understanding that the underlying debt obligation created by Plaintiff’s loan would be immediately packaged and sold, to investors on a secondary mortgage market as Mortgage Backed Securities (“MBS”)1 and as Collateralized Mortgage Obligations (“CMO”)2, through the creation of a Special Purpose Entity (“SPE”)3. 134. In an effort to conceal the true identity of the transaction, Defendants agreed, between and among themselves, to engage in actions and a course of conduct designed to further an illegal act or accomplish a legal act by unlawful means, and to commit one or more overt acts in furtherance of the

conspiracy to defraud the Plaintiff. 135. Defendants agreed between and among themselves to engage in the conspiracy to defraud for the common purpose of accruing economic gains for themselves at the expense of and detriment to Plaintiff. 136. Defendants’ actions were committed intentionally, willfully, wantonly, and with reckless disregard for Plaintiff’s rights. 137. In connection with the application for and consummation of the subject mortgage loan, Defendants agreed, between and among themselves, to engage in actions and a course of conduct designed to further an illegal act or accomplish a legal act by unlawful means, and to commit one or more overt acts in furtherance of the conspiracy to defraud the Plaintiff 138. Plaintiff thus demands an award of actual, compensatory, and punitive damages. COUNT-IX BREACH OF FIDUCIARY DUTY BEIRMAN & GEESING, BASSET, AND SLATER 139. Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein 140. As trustee and the substitute trustee, Defendants Basset and Bierman & Geesing and Slater had a fiduciary duty to Plaintiff to both disclose truthful information and foreclose only upon a valid note. 141. Bierman & Geesing, Basset and Slater failed to provide the information Plaintiff requested, failed to verify the validity of the Plaintiff debt, yet attempted foreclosure on behalf of a creditor that they knew did not own or

control Plaintiff’s debt. 142. As a direct and proximate result of the actions of the Defendants, Plaintiff has suffered injury. COUNT X BREACH OF CONTRACT/BREACH OF DUTY OF GOOD FAITH AND FAIR DEALING – HSBC Mortgage Corporation (USA), and BIERMAN & GEESING 143. Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein. 144. Plaintiff’s Deed of Trust, Paragraph 24 states that “The Lender….may appoint a substitute trustee” Therefore, in attempting to foreclose prematurely, Defendants have breached the provisions of the Deed of Trust. Further, Plaintiff alleges that it has not defaulted on its obligations to pay on the note and Deed of Trust as it has repeatedly asked for verification and validation of its debt. Only the “LENDER” can appoint and the “LENDER” is yet to be identified. To date, Defendants have not provided such verification or validation of the debt. As such, without Plaintiff’s default, No Defendant had a right to accelerate Plaintiff’s debt obligation. 145. Further, by failing to provide Plaintiff the requested information, by collecting upfront fees for services not performed, by purposely giving Plaintiff false information about the true owner of Plaintiff’s note, by not complying with the relevant Trust laws to obtain proper assignment of Plaintiff’s note and mortgage, and by attempting to foreclose on a debt that it had not rights to foreclose, the listed Defendants routinely and regularly breached their duties under the PSA (with Plaintiff being a third party beneficiary), and breached their duty to Plaintiff of Good Faith and Fair

Dealing. 146. Defendants breached the PSA submitted for the 2006-G Trust that included Plaintiff’s loan. Without such PSA, Plaintiff and other similarly situated mortgagors would never have been able to obtain financing. 147. As a result of Defendant’s breaches, Plaintiff has suffered.

DECLARATORY JUDGMENT (ACTION TO QUIET TITLE) as to all Defendants 148. Plaintiff incorporates by reference the allegations in previous paragraphs of this Complaint as if fully set forth herein. 149. Plaintiff alleges that there is an “actual controversy” in determining whether Defendants have a legal right to foreclose on Plaintiff’s Property because Defendants are not persons entitled to enforce the underlying negotiable and/or security instruments. 150. None of the listed Defendants are (i) the holder of Plaintiff’s note or Deed in Trust, (ii) a non-holder in possession of such instruments having the rights of a holder, or (iii) a person not in possession of the instrument who is entitled to enforce the instrument. 151. By the very nature of the way Plaintiff’s Note was “pooled,” the Note lost its individual identity under the express terms of the PSA. The revenue from the Note was made part of a larger promise to pay, under which the payments less than one note could be effectively applied to another note where the payment was not made. 152. Since a negotiable note is ONLY a note where there is an unconditional

promise to pay, the pooling agreement at the aggregator (loan wholesaler) level combined with the re-pooling at the SPV level, the note was converted from an unconditional promise to pay to a conditional promise to pay. 153. In addition, the presence of insurance, credit default swaps[17], and bailouts from the U.S. Treasury and Federal Reserve indicate that the listed Defendants have been paid in full. 154. As discussed above, Defendants have failed to provide documents which would offer sufficient facts for Plaintiff or this Court to establish who the necessary parties to this action are, what are the Defendants’ legal relationships to the Plaintiff, what rights do individual Defendants have to the property including but not limited to a claim for foreclosure on the Promissory Note. 155. Defendants’ failure to meet the standing requirements renders its threat of foreclosure fatally defective and constitutes actionable misrepresentations to this Court as to the identity and status of said parties. 156. To have legal standing to foreclose, HSBC must allege that it is a holder in due course of the Note and the mortgage, an allegation which Defendant already knows to be untrue. 157. To qualify as a holder in due course or qualify as having the rights of a holder-in-due-course. In order to prove that they are the holder in due course they (or a custodian) must physically possess the note. Which we already know they do not. 158. Further, to be holder in due course, there must be proper endorsement to the trust. This mean that there must be proper endorsement from the

originating lender to the wholesale lender to the issuer, and finally from issuer to a trust. 159. Conveyance, according to the Pooling and Servicing Agreement, requires that the original Note be endorsed showing a complete, unbroken, chain of endorsements from the originator to the depositor. (See PSA Article II – Conveyance of Mortgage Loans; Original Issuance of Certificates, Section 2.01.) 160. In order for the mortgage loan and Note to have been conveyed legally into the Pool, the Note requires endorsement from all intervening parties from the Originator HSBC to the Trustee, HSBC Bank USA, National Association. 161. As discovered by LFA, (Legal Forensic Auditors): At some point therein, the loan was sold to Wells fargo Bank, N.A., the sponsor listed on the [PSA]. Thereafter, that sponsor then sold the loan to the depositor, Wells Fargo Asset Securities Corporation. Wells Fargo Asset Securities Corporation then sold the loan to the Issuing Entity, Wells Fargo Mortgage Backed Securities 2008-AR2 Trust CIK#: 0001425053. The Issuing Entity, Wells Fargo Mortgage Backed Securities 2008-AR2 Trust CIK#: 0001425053 then sold the loan to the Trustee HSBC Bank USA National Association for the benefit of the Certificate Holders. See Forensic Audit entered previously. 162. Pursuant to the Deed of Trust, MERS is described as follows: MERS is Mortgage Electronic Registration Systems, Inc. MERS is a separate corporation that is acting solely as a nominee for Lender and Lender’s

successors and assigns. MERS is the beneficiary under this Security Instrument. MERS is organized and existing under the laws of Delaware . . . . Otherwise, MERS has no connection to the loan, promissory note evidencing it and/or Deed of Trust allegedly securing it. 163. MERS is, simply stated and pursuant to its name, a registration system through which promissory notes and the “holders” thereof may be identified. MERS did not lend any money to Plaintiff at anytime, nor did Plaintiff receive any monies or other benefit from MERS at anytime. 164. At no time, inclusive of the date of the alleged “Deed of Appointment of Substitute Trustee” was MERS the holder of the Note, nor was MERS named as a “Trustee” or “Substitute Trustee,” nor was it empowered pursuant to the Deed of Trust with any power to name and/or designate a substitute trustee under and pursuant to the terms of the Deed of Trust, nor was MERS ever vested with the powers of a substitute trustee under the terms of the Deed of Trust. 165. Accordingly and pursuant to the allegations heretofore set forth, the cause and/or effect of the “Deed of Appointment of Substitute Trustee” is meaningless in its entirety and is, at best, a legal nullity. 166. Plaintiff states that according to the Deed of Trust at paragraph 24, ONLY THE LENDER has the authority to appoint a substitute trustee. The Deed of Trust at paragraph 24 states as follows; “Lender at its option, may from time to time remove Trustee and appoint a successor trustee to any trustee appointed hereunder.........by applicable law”.

167.

The appointment of the substitute trustee raises questions as such appointment was not done as per “paragraph 24” of the Deed of Trust. Neither Maria Vadney nor Michelle Laster have any authority to appoint the substitute trustee and execute the deed of appointment of the substitute trustee. ONLY the LENDER can exercise the option of appointing a substitute trustee. Neither Ms. Vadney nor Ms. Laster, lent any money; therefore, it does not fit the definition of a lender, so neither are authorized to execute the Deed of appointment of successor trustee. Therefore, this appointment is NOT VALID and therefore, the acts of the substitute trustees including foreclosure sale conducted by the substitute trustee, is also NOT VALID.

168.

Also, Plaintiff has sent the following documents to the named Defendants: • On Feb.17, 2010, Plaintiff sent an authorized Qualified Written Request (QWR) as per RESPA 12 USC § 2605 (e) to the Defendants HSBC and Basset, which said Defendants failed and refused to answer. (See Exhibit “F”) • On April 02,2010,Plaintiff sent a Final Notice of Default/Dishonor/Rescission and Demand letter to HSBC, via notary service.

169.

After the passage of 20 days (in addition to 5 days, as the Rescission and Demand Letter was sent by U.S. Mail) Defendant had not produced the requested document to Plaintiff or contacted Plaintiff to state that the document is available for inspection and copying.

170.

As Defendant HSVBC has failed to act in timely manner upon receipt of the Rescission and Demand letter, it is noncompliant with federal law and

has given rise to a claim against itself. 171. Rescission is self enforcing and it automatically extinguishes the lien and the liability. The statute and regulation specify that the security interest, promissory note or lien arising by operation of law on property becomes automatically void (15 U.S.C § 1635 (b); Z §§ 226.15 (d) (1), 226.23 (d) (1). 172. The Defendant’s interest in the property is “automatically negated regardless of its status and whether or not it was recorded or perfected”. Official staff commentary §§ 226.15 (d) (1)-1,226.23 (d) (1) 1. 173. Since the rescission process was intended to be self-enforcing, failure to comply with the rescission obligation subject Defendant to potential liability as noncompliance is a violation of the RESPA which gives rise to a claim for actual and statutory damages under 15 U.S.C 1640. 174. The statute and Regulation Z state that if creditor disputes the consumer’s right to rescind, it should file a declaratory judgment action within the twenty days after receiving the rescission notice, before its deadline to return the consumer’s money or property and record the termination of its security interest (15 USC 1625(b)). Once the lender receives the notice, the statute and Regulation Z mandate 3 steps to be followed. a. By operation of law, the security interest and promissory note automatically become void and the consumer is relieved of any obligation to pay any finance or other charges (15 USC 1635(b); Reg. Z-226.15(d)(1),226.23(d)(1). See Official Staff Commentary

§ 226.23(d)(2)-1. b. Since Plaintiff has legally rescinded the loan, the supposed mortgage holder, HSBC must return any money, including that which may have been passed on to a third party, such as a broker or an appraiser and to take any action necessary to reflect the termination of the security interest within 20 calendar days of receiving the rescission notice (a term which has long since expired). c. The Defendant must take any necessary or appropriate action to reflect the fact that the security interest was automatically terminated by the rescission within 20 days of the Defendant’s receipt of the rescission notice (15 USC 1635(b); Reg. Z-226.15(d)(2), 226.23(d)(2). Non-compliance is a violation of the act which gives rise to a claim for actual and statutory damages under 15 USC 1640.. 175. Plaintiff requests the Honorable Court to order the Defendants to file documents canceling the documents of the record and to issue judgment for damages and refunds as the statute and regulation specify that the security interest, promissory note or lien arising of operation of law on property becomes automatically void. 176. Also, Defendants HSBC and Bierman & Geesing are to take any necessary or appropriate action to reflect the fact that the security interest was automatically terminated by the rescission (15 USC 1635(b); Reg. Z-226.15(d)(2),226.23(d)(2).

177.

Plaintiff also requests the honorable Court to compel HSBC to produce an S3 registration statement which will indicate that Defendants are not the real parties in interest.

178.

Plaintiff has a claim in recoupment under § 3-305 of the UCC, which Plaintiff will exercise at his option, if Defendant HSBC does not credit Plaintiff’s account. The 1099-OID will identify who the principal is from, which capital and interest were taken, and who the recipient or who the payer of the funds are, and who is holding the account in escrow and unadjusted.

179.

WHEREFORE Plaintiff respectfully requests the Court to declare the DOT currently encumbering the Property to be null and void and to order such DOT and all related filings to be removed from the land records. IV. PRAYER FOR RELIEF

WHEREFORE, having set forth numerous legally sufficient causes of action against the Defendants, Plaintiff prays for: a. The entry of Final Judgment against all Defendants jointly and severally in an amount not yet quantified but to be proven at trial, for violations and damages caused by of tort, breach of contract, fraud, misrepresentation, violation of TILA, Usury statues, other consumer protection acts and such other amounts to be proven at trial; b. Award costs, interest and attorneys’ fees; c. Award statutory damages;

d. All undisclosed profits and fees and all money paid at closing; e. Award compensatory damages and special damages to be

established at trial; f. g. That the Court find that the transactions which are the subject of this action are illegal and are deemed void; That the foreclosure which was instituted be deemed and declared illegal and void;

h. That further proceedings in connection with the foreclosure be enjoined; i. j. That the Court order Defendants to remove the fraudulent negative reports from all credit bureau agencies; That a Quiet Title action be sustained; and,

k. For any other and further relief which is just and proper. PRAYER FOR PUNITIVE RELIEF WHEREFORE, Plaintiff respectfully prays that this Court award relief for punitive damages in the sum of $5,000,000.

PRAYER FOR INJUNCTIVE RELIEF WHEREFORE, Plaintiff seeks an injunction prohibiting the Defendants from any action which would result in Plaintiff being ousted from the disputed Property. By virtue of the foregoing, Defendants are not “holders” of the disputed Promissory note and therefore are not entitled to enforce the same, and by further virtue that HSBC is not the “Lender,” “Beneficiary,” nor party entitled to enforce the terms of the pertinent Deed of Trust, no Defendants, nor anyone acting on their behalves, has or had a right to issue a notice of default, accelerate the balance due under the pertinent note and/or foreclose and/or commence and/or attempt to foreclose on the disputed property. Plaintiff is threatened with immediate, irreparable harm if any of the

Defendants are permitted to continue to lay claim to Plaintiff’s property and commence any action to deprive Plaintiff of title or possession of the property. If Defendants are not stopped from commencing and/or pursuing any action to further their unlawful claims to an interest in the property, Plaintiff could and would thereby lose his home, a loss Plaintiff should not be permitted to suffer. Even if any of the Defendants can, at some point, prove that they are acting under claim of right and with rightful authority, any injuries each might suffer by the court granting a restraining order and preliminary injunction against them would be substantially less harmful than those which Plaintiff would suffer by the loss of his home. Accordingly, Plaintiff is entitled to a restraining order and preliminary and permanent injunction against all Defendants in this case, prohibiting them from issuing a notice of default, accelerating the balance due under the pertinent note and/or foreclosing and/or commencing and/or attempting to foreclose. By the actions above and allegations set forth herein, Plaintiff has a strong likelihood of prevailing on the merits of this case. Plaintiff requests that this Court grant a restraining order and preliminary and permanent injunction precluding Defendants from engaging in the wrongful conduct identified herein in the future. RIGHT TO AMEND Plaintiff hereby reserves the right to amend this lawsuit, including additional facts and/or causes of action as more information becomes available. JURY TRIAL Plaintiff continues to request a jury trial of this action. CERTIFICATE OF SERVICE

Below are the footnotes, but they did not copy exactly in the same location:

This entire notice was recorded in the public record of Jefferson County, WV as the court in Virginia refused to accept the filing. [2] Also in the public record of Jefferson County, WV.
[1]

Plaintiff provided Defendants HSBC and Basset a second opportunity to cure the defects in their response or non-responses by using a Notary to present the notices. (See Exhibit I). [4] Making a photocopy of the negotiable instrument and presenting it to Plaintiff as evidence of the debt gives HSBC as much authority to collect on the debt as one would have to purchase items from a store using a photocopy of a $100.00 bill. [5] The creditor/Investor receives an instrument which is generically referred to as a Mortgage Backed Asset Certificate/Bond (“Certificate/ Bond”). The Certificate/Bond incorporates terms by which the promise to pay interest and principal is made by the issuing SPV and the manager for this in the present case is HSBC Bank USA, National Association.
[3] [6] The

PSA, Exhibit 4.1 of the current 8K report filed before the SEC as per file # 333-143751-13 and Accession # 914121-8-213 dated March 06, 2008, by the securitization partners is a public record available at www.sec.gov. [7] At minimum, Plaintiff’s note should include the following endorsement to show the proper chain of transfers: HSBS Mortgage Corporationà Wells Fargo Bank, N.Aà Wells Fargo Asset Securities Corporationà Lehman Brothers Special Financing Inc.à Lehman Brothers IncàDealersàAgentsà Investors. This can be found on the www.sec.gov website at the Prospectus Supplement 424(b)5, SEC file # 333-143751-13, Accession # 1193125-8-38785, filed on 02/26/2008 at 4:48PM ET). This is also confirmed by examination of the securitization audit performed and entered into evidence in the Eastern District Court of Virginia in Alexandria, Case: 1:10cv1427.
[8] Under PSAs, for a mortgage note to validly transfer to a mortgage securitization trust, the note must bear special endorsements evidencing each and every transfer of the note from the originator of the loan to the securitization trustee. A note bearing a “blank” endorsement by the originator, or by another entity further along in the chain of transfer, does not satisfy the requirements of certain PSAs, and thus that the transfer of such a note into a trust is rendered void by New York Estate, Powers and Trust Law § 7-2.4.

ARTICLE II, CONVEYANCE OF MORTGAGE LOANS; REPRESENTATIONS AND WARRANTIES PSA Section 2.01 (b)(i) states:

“the original Mortgage Note bearing all intervening endorsements showing a complete chain of
endorsement from the originator to the last endorsee, endorsed "Pay to the order of _____________, without recourse” and signed (which may be by facsimile signature) in the name of the last endorsee by an authorized officer. To the extent that there is no room on the face of the Mortgage Notes for endorsements, the endorsement may be contained on an allonge, unless state law does not so allow and the Trustee is so advised in writing by the applicable Original Loan Seller or the Depositor that state law does not so allow”

Real Estate Mortgage Investment Conduits, or "REMICs," (sometimes also called Collateralized mortgage obligations) are a type of special purpose vehicle used for the pooling of mortgage loans and issuance of mortgage-backed securities. Such entities are defined under the United States Internal Revenue Code (Tax Reform Act of 1986), and are the typical vehicle for the securitization of residential mortgages.
[9]

Though REMICs provide relief from entity-level taxation, their allowable activities are limited to holding a fixed pool of mortgages and distributing payments currently to investors. A REMIC has some freedom to substitute qualified mortgages, declare bankruptcy, deal with foreclosures and defaults, dispose of and substitute defunct mortgages, prevent defaults on regular interests, prepay regular interests when the costs exceed the value of maintaining those interests, and undergo a qualified liquidation, in which the REMIC has 90 days to sell its assets and distribute cash to its holders. All other transactions are considered to be prohibited activities and are subject to a penalty tax of 100%, as are all non-qualifying contributions.
[10] Maiden Lane III LLC (a Special Purpose Vehicle consolidated by the Federal Reserve Bank of New York) (the "LLC") is a Delaware limited liability company that was formed on October 14, 2008 to acquire Asset-Backed Security Collateralized Debt Obligations ("ABS CDOs") from certain thirdparty counterparties(Banks) of AIG Financial Products Corp. ("AIGFP"). In connection with the acquisitions, the third-party counter parties (Banks) agreed to terminate their related credit derivative contracts with AIGFP. 1 MBS means securities backed by specific mortgage loans and the payments on which are tied to or derived from the cash flows produced from underlying mortgage loans.
2 CMO refers to series of securities created by dividing the cash flows from a pool of mortgage loans among various serially maturing tranches of securities. Typically, CMOs receive the tax classification applicable to real estate mortgage investment conduits (REMIC) under U.S. tax laws. 3 A SPE is a legal entity formed for a limited purpose; in securitization, it serves to hold legal rights to the assets transferred from the originator. In the U.S., SPEs facilitate securitization by enabling the use of “bankruptcy-remote structures” (a technique used for isolating assets or loans from the bankruptcy risk of the company financing or selling the assets).

[11] The whole purpose of MBS’s was for different investors to have their different risk appetites satiated with different bonds. Some bond customers wanted super-safe bonds with low returns; some others wanted riskier bonds with therefore higher rates of return. Therefore, as everyone knows, the loans were “bundled” into REMIC’s (Real-Estate Mortgage Investment Conduits, a special vehicle designed to hold the loans for tax purposes), and then “sliced & diced”—split up and put into tranches, according to their likelihood of default, their interest rates, and other

characteristics. This slicing and dicing created “senior tranches”, where the loans would likely be paid in full. And it also created “junior tranches”, where the loans might well default. (A whole range of tranches were created, of course, but for purposes of this discussion, we can ignore all those countless other variations.) These various tranches were sold to different investors, according to their risk appetite. That’s why some of the MBS bonds were rated as safe as Treasury bonds, and others were rated by the ratings agencies as risky as junk bonds. When an MBS was first created, all the mortgages were pristine—none had defaulted yet, because they were all brand new loans. Statistically, some would default and some others would be paid back in full—but which ones specifically would default? No one knew, of course. If I toss a coin 1,000 times, statistically, 500 tosses the coin will land heads—but what will the result be of, say, the 723rd toss specifically?

The note homebuyer signs is the actual IOU. In order for the mortgage note to be sold or transferred to someone else (and therefore turned into a Mortgage Backed Security), this document has to be physically endorsed to the next person. All of these signatures on the note are called the “chain of title”. Without a clear chain of title, the person who took out the mortgage no longer knows who to pay. No assignment of the chain of transfer were recorded in the Fairfax County Land Records.
[12] [13] A party cannot foreclose on a mortgage without having title, giving it standing to bring the action. (See Kluge v. Fugazy, 145 AD2d 537, 538 (2nd Dept 1988 ), holding that a “foreclosure of a mortgage may not be brought by one who has no title to it and absent transfer of the debt, the assignment of the mortgage is a nullity”. Katz v. East-Ville Realty Co., 249 AD2d 243 (1st Dept 1998), holding that “[p]plaintiff’s attempt to foreclose upon a mortgage in which he had no legal or equitable interest was without foundation in law or fact” and Non-judicial sale is NOT an available election for a securitized loan [14] In Carpenter v. Longan, the U.S. Supreme Court stated “The note and mortgage are inseparable; the former as essential, the latter as an incident. An assignment of the note carries the mortgage with it, while an assignment of the latter alone is a nullity.” Carpenter v. Longan, 16 Wall. 271, 83 U.S. 271, 274, 21 L.Ed. 313 (1872). Assigning the mortgage instrument was invalid as it held no beneficial interest in the mortgage instrument for two reasons: 1) a security instrument, apart from the promissory note giving rise to the debt has no value because there is no debt by which it secures payment; and 2) MERS had no beneficial interest in the mortgage instrument that it could assign. An assignment of the note carries the mortgage with it, while an assignment of the latter alone is a nullity.” The mortgage loan becomes ineffectual when the note holder did not also hold the deed of trust.” Bellistri v. Ocwen Loan Servicing, LLC, 284 S.W.3d 619, 623 (Mo. App. 2009) [15] “The practical effect of splitting the deed of trust from the promissory note is to make it impossible for the holder of the note to foreclose, without the agency relationship, the person holding only the note lacks the power to foreclose in the event of default. The person holding only the deed of trust will never experience default because only the holder of the note is entitled to payment of the underlying obligation. The mortgage loan becomes ineffectual when the note holder did not also hold the deed of trust.” Bellistri v. Ocwen Loan Servicing, LLC, 284 S.W.3d 619, 623 (Mo. App. 2009). According to Restatement 3rd, when the note and DOT are split, they can never be put back together again. Courts around the country started to recognize that MERS had no ownership in the notes and could not transfer an interest in a mortgage upon which foreclosure could be based. In Landmark National Bank v. Kesler, the Kansas Supreme Court extensively analyzed the position of MERS in relation to the, that it did not lend money, did not extend credit, is not owed any money by the mortgage debtors, did not receive any payments from the borrower, suffered no direct, ascertainable monetary loss as a consequence of the litigation and consequently, has no constitutionally protected interest in the mortgage loan. Landmark National Bank v. Kesler, 216 P.3D 158 (Kansas, 2009). In LaSalle Bank NA v. Lamy, the court denied a foreclosure action by an assignee of MERS on

the grounds that MERS itself had no ownership interest in the underlying note and mortgage. LaSalle Bank NA v. Lamy, 824 N.Y.S.2d 769 (N.Y. Supp. 2006). In the case In re Mitchell, the court found that MERS has no ownership interest in the promissory note. The court found that though MERS attempts to make it appear as though it is a beneficiary of the mortgage, it in fact is not a beneficiary. The Court stated “But it is obvious from the MERS' "Terms and Conditions” that MERS is not a beneficiary as it has no rights whatsoever to any payments, to any servicing rights, or to any of the properties secured by the loans. In re Mitchell, Case No. BK-S-07-16226-LBR (Bankr.Nev., 2009),

[16] Maiden Lane III LLC (a Special Purpose Vehicle consolidated by the Federal Reserve Bank of New York) (the "LLC") is a Delaware limited liability company that was formed on October 14, 2008 to acquire Asset-Backed Security Collateralized Debt Obligations ("ABS CDOs") from certain thirdparty counterparties(Banks) of AIG Financial Products Corp. ("AIGFP"). In connection with the acquisitions, the third-party counter parties (Banks) agreed to terminate their related credit derivative contracts with AIGFP. Maiden Lane Transactions, Maiden Lane LLC, Maiden Lane II LLC, Maiden Lane III LLC, Federal Reserve Statistical Release". Federal Reserve Bank of New York. August 10, 2010. http://www.federalreserve.gov/releases/h41/Current/, "SIGTARP Report 10-003 Factors Affecting Efforts to Limit Payments
1 MBS means securities backed by specific mortgage loans and the payments on which are tied to or derived from the cash flows produced from underlying mortgage loans. 2 CMO refers to series of securities created by dividing the cash flows from a pool of mortgage loans among various serially maturing tranches of securities. Typically, CMOs receive the tax classification applicable to real estate mortgage investment conduits (REMIC) under U.S. tax laws. 3 A SPE is a legal entity formed for a limited purpose; in securitization, it serves to hold legal rights to the assets transferred from the originator. In the U.S., SPEs facilitate securitization by enabling the use of “bankruptcy-remote structures” (a technique used for isolating assets or loans from the bankruptcy risk of the company financing or selling the assets).

[17] Basically

credit default swap is like insurance (but it is not defined as insurance, but rather unregulated securities by Federal Law), and there is nothing preventing an investor from insuring on losses multiple times.

Sign up to vote on this title
UsefulNot useful