Here is a story to shoot your blood pressure through the roof:

“While Sgt. James B. Hurley was away at war, he lost a heartbreaking battle at home.

In violation of a law intended to protect active military personnel from creditors, agents of Deutsche Bank foreclosed on his small Michigan house, forcing Sergeant Hurley’s wife, Brandie, and her two young children to move out and find shelter elsewhere.

When the sergeant returned in December 2005, he drove past the densely wooded riverfront property outside Hartford, Mich. The peaceful little home was still there — winter birds still darted over the gazebo he had built near the water’s edge — but it almost certainly would never be his again. Less than two months before his return from the war, the bank’s agents sold the property to a buyer in Chicago for $76,000.”

And it only gets worse from there.

The Sergeant (retired, disabled) has been on a legal odyssey that is in its 7th year. He is battling Deutsche Bank Trust Company and Morgan Stanley subsidiary Saxon Mortgage Services.

Under the Servicemembers Civil Relief Act, Hurley’s lawyers are seeking punitive damages against the two giant banks. The NYT reports the specifics of the Servicemembers Act:

“Under the law, only a judge can authorize a foreclosure on a protected service member’s home, even in states where court orders are not required for civilian foreclosures, and the judge can act only after a hearing where the military homeowner is represented. The law also caps a protected service member’s mortgage rate at 6 percent.”

Big banks routinely violated the act. Wells Fargo and Citigroup were cited, as was JPMorgan Chase (they regularly overcharge servicemen, despite the law).

But as bad as Chase has been, they seem to be trying to make amends. Not so with the weasels who run Deutsche Bank and Saxon in the Hurley case. They seem to be fighting the Hurley’s tooth and nail.

There are many reasons never to bailout banks, but here’s another one: Too many seem to be run by spineless weasels, and they hurting men and women serving in armed armed forces. (Aren’t there any ex service people working at these banks that can get this taken care of promptly?)

Shame on Morgan Stanley, and shame Deutsche Bank.


A Reservist in a New War, Against Foreclosure
NYT, January 26, 2011

Category: Bailouts, Foreclosures, Legal

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

29 Responses to “US Soldiers Losing Homes to Illegal Foreclosures”

  1. carleric says:

    Chase holds my mortgage….it was with Washington Mutual but we all know what happened there. I had a problem with Chase’s clerical work…they mixed up me with some other bankruptcy filing but in their defense they corrected the error after only a couple e-mails and phone calls. But this latest is inexcusable. When are some of these stupid f**ks going to jail? And Bennie and Timmie are still worried that they might fail……so what if they do? Bank bailouts occur whenever some well-connected banker takes Bennie to lunch, whines about mistakes he never saw coming and opens his mouth at the slop trough. Oh, yes…its to protect the companies from systemic risk…to their pocket books…

  2. louis says:

    They need to bring some of these guy’s in for the committee.

  3. Lyle says:

    Actually just another sign of the sloppiness that has crept into our entire economy, where people are involved in decision making. The documentation mess, the corner cutting when the mortgages are made, the issues of following the law, the BP spill, the Wright County Egg scandal and many others are caused by people not sweating the details. The folks that knew the rules have all retired and their replacments don’t care and/or don’t know the details. Thankfully a lot of transactions are done by computers who do sweat the details. The whole sloppiness issue is both due to ignorance, and a push for volume and a desire by managment to get rich quick. Now part of the issue is that in the old days you used postal mail, with a return reciept requested to deal with these issues, and had a record of what you did, today you use the phone. If really concerned you could have certified copies of the letters saved for you. Its just like the issue of the documents, faxing is stupid, the only methods the laws handle well are via certified or registered mail. But then new mortgages don’t require using these methods either.

  4. dss says:

    “The only “crime” is in that a guy like me who pays their creditors has to live amongst a group of deadbeats constantly running around whining whilst they pork their own.”

    No one forced these deadbeats to sign on the bottom line, right?

    Care to rephrase your characterization?

  5. Sechel says:

    Every securitizatin that I have ever seen makes some reference to the Servicemembers Relief Act, formerly known as the Soldier’s and Sailers Civil Relief Act of 1940 or the Relief Act. This is not only a “rookie mistake” but embarassing as this is not an obscure part of the law and well known to anyone involved with servicing or securitizations.

    From the Prospectus of RFMSI 2004-s1.

    The Relief Act also limits the ability of the servicer to foreclose on a mortgage loan during the borrower’s period of active duty and, in some cases, during an additional three month period thereafter. As a result, there may be delays in payment and increased losses on the mortgage loans

  6. jeff in indy says:

    BR – do you know if he has a LDF and what the address or link is?

  7. not to excuse the ‘bank’s’ actions, but I can’t believe he wasn’t using USAA..

    they would have never done him that way..

    one of the few Co.s that, actually, gets ‘Customer Centered Innovation’ ..

  8. Casual_Observer says:

    Seems like a ready made issue for one of the Michigan Congressional delegation. Generally, politicians fall all over themselves to help servicemen and women, particularly at the expense of foreign companies.

  9. Tim says:

    The specific individual banksters involved in this should be air-dropped into Taliban territory in Afghanistan.

  10. Lyle says:

    Re Sechel, if the observation about proxies in the Big Short that a lot of them are never read, applies to the PSAs, where the worker bees don’t read them (quite likley) Then the issue is not well known, due to failures of education on the part of the servicers of their employees. This is likley a large part of the issue the defective training given those on the front line, which of course is due to managments desire to maximize returns, and just ignore the law.

  11. @MEH:

    He probably wasn’t eligible for USAA membership when he took out his mortgage–the company started out exclusively for officers in the military, then it allowed virtually anyone that could claim some relationship to an officer in the military; now any servicemember and their relations are eligible.
    Its primary business is insurance, particulary vehicle insurance, but has expanded into financial services over the last decade or so.

    I’ve been a member/customer of USAA since 1986. It’s a fairly good and decent company, but is not above playing the creeping insurance premium trick to juice its revenues–I recently had a little tiff w/ them over how much “replacement cost” should be on my homeowner’s policy, considering that costs actually had declined across the board just before they instituted an increase. The bottom line is that USAA is an insurance/financial services company not much different than any other, except that it purports to have special expertise in meeting the needs of service members. As in dealing with any other, caveat emptor, like the Dude, abides.

  12. DeDude says:

    I say we authorize the military to take care of this problem. Nothing a few laser-guided missiles couldn’t fix. No Citigroup, no Chase, no Deutsche Bank – no problem. Collateral damage; hey since when did we care about collateral damage.

    On a more serious note this is the end result of cost cutting. After you fire people to cut cost the work is still there and the remaining people have to cut corners to get it done. There is no such thing as a free (profit) lunch. You can pay for it in people or you can pay for it in court cost.

  13. James says:

    Too many seem to be run by spineless weasels, and they hurting men and women serving in armed armed forces. (Aren’t there any ex service people working at these banks that can get this taken care of promptly?)

    Shame on Morgan Stanley, and shame Deutsche Bank.


    Calling it like it is as usual, BR. Put the CEOs of these banks in uniforms and ship them off to Afghanistan for a tour or two.

    Oh, and confiscate their homes while they’re gone for extra measure.

    How much in taxpayer dollars did their banks receive when the banking system was slipping down a rabbit hole?

    Bunch of frickin’ clowns . . .

  14. Arequipa01 says:

    Here is a link to Tammie Lee Kapusta’s deposition:

    Go to pages 37 and 38 where she answers questions related to searches for members of the military using social security numbers. To wit:

    “I was taking James’ social security number and putting John Doe’s name in there.”

    Don’t forget that two heroes from WWII participated in the brutal action against veterans in Washington, D.C.

    “A month later, on July 28, Attorney General Mitchell ordered the evacuation of the veterans from all government property, Entrusted with the job, the Washington police met with resistance, shots were fired and two marchers killed. Learning of the shooting at lunch, President Hoover ordered the army to clear out the veterans.
    and cavalry supported by six tanks were dispatched with Chief of Staff General Douglas MacArthur in command. Major Dwight D. Eisenhower served as his liaison with Washington police and Major George Patton led the cavalry.
    By 4:45 P.M. the troops were massed on Pennsylvania Ave. below the Capitol. Thousands of Civil Service employees spilled out of work and lined the streets to watch. The veterans, assuming the military display was in their honor, cheered. Suddenly Patton’s troopers turned and charged. “Shame, Shame” the spectators cried. Soldiers with fixed bayonets followed, hurling tear gas into the crowd.”

  15. Arequipa01 says:

    I meant three heroes. Yay! America! Yay! (Memory Nazi says: “No memory for you!”)

  16. [...] the feel-good story of the day!  Soldiers are losing their homes to illegal foreclosures.  (TBP) [...]

  17. bear_in_mind says:

    Hate to break it to you, but there’s more fraudulent loans circulating than you can imagine. And IMHO, these people aren’t clowns, they’re criminals.

    I just got my hands on the docs for a $665K adjustable-rate Wachovia loan, circa April 2008, that was sold to an 86 year-old widow. They couldn’t issue the loan with her actual income ($5K per month), so they ‘documented’ her income at $12,450 per month! Two years later, she’s 88 years-old, the loan resets and naturally she can’t afford the payments. Wells Fargo forecloses and picks up the property (REO) at 20-30 percent discount off market value… leaving her to fend for herself.

    If that wasn’t bad enough, the law firm representing the bank was fast-tracking her eviction; and a ‘foreclosure mitigation firm’ learned of this woman’s woes by trolling the internet. They contacted her and were working to convince her she could stay in her house via a land trust scheme by sending them $7995.00 via wire transfer.

    If I wasn’t seeing this with my own two eyes, I wouldn’t believe it was happening in America. But it is.

    Will our institutions belatedly, but finally, rise to the occasion? Or have they become so besotted with grift that this will be our country’s future path, where these kind of outrageous violations become the rule, not the exception?

    Said another way, what is it going to take to jog us from our collective stupor?

  18. Pocket QQ says:

    Hello America! look at your mortgage. Now look back at me!

    Imagine yourself filing a complaint with your AG and seeing your complaint transferred to the OCC. Who then puts you in touch with the very Office of President and CEO of the Bank you just filed a complaint against. Now, ‘with-out warning’ your bi-weekly auto-pay mortgage has been canceled. Your account has been back-dated. You are now 120 delinquent on your mortgage. Now look at your FICO score. Now back at me. You are now seeing your awesome credit score plunge 200 points in a single month. Where are you now? You are in the “Loan Modification Pool” waiting for Investors to announce the rules of modification for 2011. How did you get here? You listened to your President tell you to take advantage of low rates. You tried to refinance your 7.6% mortgage by locking in a 4.2% rate. Now look at your Bank. Now back at me. Now look at interest rates. Now back at me. This is hand to hand combat on individual loans.

    Investors? Yes, anyone can appear to be what we want in our loan pools…

    This is a parody, but it is 100% true. 170 points on the plunge in the persons credit score happened Tuesday.

  19. bobmitchell says:


    If you start nosing around the “financing” that takes place near military bases you are going to hear from congress, a lot of them count on that income from pawn shops and used car dealers.

  20. April Charney says:

    12 USC 1701x(C)(5) is titled: Notification of availability of homeownership counseling and provides, in pertinent part:

    (A) Notification of availability of homeownership counseling.

    (i) Requirement… the creditor of a loan shall provide notice…to…any eligible homeowner who fails to pay any amount by the date the amount is due under a home loan…

    (ii) Content. Notification…shall…notify the homeowner…of the availability of any homeownership counseling offered by the creditor…

    [and shall] (III) notify the homeowner…of the availability of homeownership counseling…

    AND SHALL…(IV) notify the homeowner by a statement or notice, written in plain English by the Secretary of Housing and Urban Development, in consultation with the Secretary of Defense and the Secretary of the Treasury, explaining the mortgage and foreclosure rights of servicemembers, and the dependents of such servicemembers, under the Servicemembers Civil Relief Act (50 U.S.C. App. 501 et seq.), including the toll-free military one source number to call if servicemembers, or the dependents of such servicemembers, require further assistance.

    (B) Deadline for notification. The notification…shall be made…
    (i) in a manner approved by the Secretary; and
    (ii) before the expiration of the 45-day period beginning on the date on which the [PAYMENT] failure occurs.

    The above statute does not apply to FHA/Hud insured or other federally insured loan (VA, fmha, etc.) because they have their own administrative, statutory and regulatory requirements.

    The above statute applies to every fannie, freddie or other conventional loan including every allegedly securitized loan.

    There is no compliance with the Servicemembers Civil Relief Act notification requirements before any foreclosure anywhere in this country. This failure is actionable to present equitable and contractual defenses to a foreclosure, judicial or nonjudicial; presents a failure of a contractual and statutory condition precedent to all foreclosures; is a breach of the mortgage contract rights of the borrower and is evidence of illegal and predatory consumer debt collection.

    The federal regulations enforcing this notice requirement were issued in 2007 and are found online at:

    So, this needs to be fixed like yesterday. There just is no excuse.

  21. MikeG says:

    Laws don’t count for much without effective regulators and substantive penalties.
    This shit isn’t going to stop until higher-ups start going to jail and losing big chunks of their personal wealth.

  22. bear_in_mind says:

    Hey Barry, can you clarify on this? I understand that the statute of limitations on securities and mortgage fraud is typically 36 months? If so, would it be based upon state laws or NY trust statutes? Other?! Much appreciated.

  23. Curm,

    keep it simple, the point was ‘USAA wouldn’t have done him like that..’


    as far as your ‘Replacement Cost’-surcharge … at least, their a Mutual ins. co. … but, as you say ~”it pays to keep your eyes peeled”..

  24. “… their a Mutual ins. co.”

    they are..

  25. Joe S. Pack says:

    I’ve got a 45 cal solution to this problem.

  26. louis says:

    FDIC Sues 14 Former First Centennial Officers, Directors Over Bank Failure

  27. Francois says:

    Yo Barrack!! Did you read this story? Did Timmy Turbo Tax read it too?

    Do you assholes even CARE??

    Let me tell you one story that may make you care: When John Ashcroft (not a guy I had lots of respect for BTW) was the AG, he sent military lawyers with expertise in the SCRA “talk frankly and openly” with the bankers in cases like the Hurleys. You know wattam sayin’? Kinda, shall we say, educate the personal out there.

    You and Timmy? You can’t be bothered. When one look at the deeds and forgo your rhetoric, it is obvious that you do not care. You prime directive is political success, as per the criteria of the Reichpubliscums, the Village and punditocracy living in Versailles-on-the-Potomac, and, last but not least, the donor class, who, oh surprise! happen to count among their august members…the banksters. Hence, it is a mere statement of fact when I write that your administration is run by the banks, for the banks, the people (the Little People, that is) be damned.

    That is why you didn’t even mentioned the fraudclosure epidemic in your vapid, lame and morally bankrupt SOTU. That is why Timmy blocked a meager 35 million of HAMP funds for being used by homeowners who desperately need good legal representation, while servicers and banks gorged themselves with fraudulent junk fees and payments, just to make sure they could suck the homeowner dry all up, while collecting all the HAMP they could. And Timmy was, and still is very happy with himself, since he is complying with the only mandate that will ever matter to him: do whatever it takes to keep the banking system as it is now.

    As for you the fuckers at Deutsche Bank Trust Company and Saxon Mortgage Services…what Joe S. Pack said.

  28. Francois says:

    “Will our institutions belatedly, but finally, rise to the occasion? Or have they become so besotted with grift that this will be our country’s future path, where these kind of outrageous violations become the rule, not the exception?

    Anything done behind a corporate shield in the US is almost guaranteed protection against the law. After all, Wachovia help the Mexican narcos to launder money through their banks for YEARS, despite being warned by the DEA. They got away with a fine. You try to pull the same trick on your own.

    CVS just paid a 75 milllion fine for knowingly selling too much pseudoephedrine to crystal meth labs in the LA area. At the same time, a poor 41 y/o woman with several medical conditions is facing 20 years in jail for the SAME OFFENSE. And…the cherry on the sundae please. a 68 y/o pharmacist from Oklahoma is facing 43 years in jail for allegedly selling the same stuff to undercover DEA agents at “too fast a rate” EVEN IF, the absolute legal limit (total amount sold) was never reached.

    I could go on and on and on, just in the health care sector. So yes! These outrageous violations have become the rule; the bigger the corporations, the more outrageous it is and shall be for a long time.

    “Said another way, what is it going to take to jog us from our collective stupor?”

    Depends! If we decide to disconnect the TV, stop listening to the usual pundits, and start reading and interacting with those who know and care (Like Barry here) then, we may stand a prayer. Otherwise, a long and painful descent into misery, like what happened to Argentina starting after WW2 is in the cards for us.

    What a lot of people do not seem to grasp is this: there cannot be sustained economic prosperity based on innovation and creativity in a society where justice is multitiered like it has become here. Pray tell how does a society maintain the principles of capitalism alive if basic property rights are not respected?

    It just cannot happen…period! End of story!

  29. “Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data, ability to repeat discredited memes, and lack of respect for scientific knowledge. Also, be sure to create straw men and argue against things I have neither said nor even implied. Any irrelevancies you can mention will also be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.”

    This is fantastic. There are far and away too many cowards and nutcases who disrupt a discourse from behind the skirts of anonymity, gleefully doing their best to piss-off legitimate posters with their spurious, fecal diatribe. Hopefully soon, all posters will be required to post their names and contact info such as an e-mail address. This will bring these illiterate, nefarious cowards to heel immediately and they will disappear from cyberspace once and for all unless they wish to risk their pencil-necks at the hands of an enraged poster. Excellent summary, thanks. I always sign my name to everything I write and invite comments. It is also a credibility issue.

    The parasitic criminals that are now feeding on the blood of service veterans and families from two illegal wars are in for a huge surprise when those they have screwed begin to appear at their front doors to find out exactly what happened to their benefits/homes. They simply have nothing to lose anymore, and revenge will be uppermost in their minds. Take it from a very pissed-off Marine, these criminals will pay the price for their crimes. I am so disgusted with the country of my birth and the fat-assed cowardly sheep that infest it, I left for good. I live in a free country now, am a free man and I will not be coming back to defend them once again. By their own actions they deserve to be left on their own, just as they abandoned us over the decades. We have had it, and the only people we will be protecting from now on is ourselves, so they can save their phony “Thank you for your service.” What a crock.

    Robert S. Finnegan
    United States Marine Corps
    Jakarta, Indonesia