More Federal Judges Disallow Foreclosures; LaRouche Says It May `Bring Down the System'

PRESS RELEASE

More Federal Judges Disallow Foreclosures; LaRouche Says It May `Bring Down the System'

Nov. 17, 2007 (EIRNS)—Following the Oct. 31 decision in Cleveland, Ohio, by Federal Judge Christopher A. Boyko, to dismiss 14 home foreclosure cases, brought by Deutsche Bank National Trust Co., on Nov. 14 Federal Judge Kathleen M. O'Malley similarly "dismissed without prejudice" 32 foreclosure cases in Cleveland, because the plaintiff did not provide documentation that it is the owner/holder of the note and mortgage when the foreclosure action was filed. Separately, on Nov. 15, Federal Judge Thomas M. Rose for the Southern District of Ohio, in Dayton, threatened to dismiss 27 foreclosure actions within 30 days, because lenders have not proven they own the property they are foreclosing on.

Lyndon LaRouche warned, the "legitimate suspicion" that banks leveraged unowned mortgage properties, could bring down the system.

Judge Rose ruled the lawyer filing 26 of the foreclosure cases had claimed his clients did own the properties at the time the foreclosures began, but he had not submitted the necessary evidence to the court.

"Failure in the future by this attorney to comply with the filing requirements," Judge Rose wrote, "may only be considered to be willful."

"A willfull failure to comply" with the pertinent law within 30 days, he said, "may result in immediate dismissal of the foreclosure action." The law requires, among other things, a recorded copy of the mortgage, and an affidavit documenting that the named plaintiff is the owner and holder of the note and mortgage at the time the foreclosure complaint is filed.

Citibank is trustee in one of the cases, the New York Times reported; it represents a securitization trust sold in 2005 by First Franklin, a loan originator now owned by Merrill Lynch. Another case involves HSBC.

Judge Rose said he was "in full agreement with Judge Christopher A. Boyko ... who recently stressed that the judicial integrity of the United States District Court is 'Priceless.'"

Judge O'Malley said the plaintiff did not "appropriately document the chain of ownership to demonstrate its legal status vis-a-vis the items at the time it files suit on those items."