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The Newest Foreclosure Scandal: Robo-Witness

Posted By Barry Ritholtz On December 14, 2012 @ 8:44 am In Credit,Foreclosures,Legal,Real Estate,Really, really bad calls | Comments Disabled

Pay attention to this, its quite fascinating and has potentially awesome and amusing consequences.

There is a former bank defense attorney named Thomas Cox. You may not recognize his name, but after he retired, he decided to switch sides, defending people on the receiving end of bank litigation, typically foreclosures. You should know him as the lawyer from Maine who exposed the entire robo-signing sscandal. The cost to banks were a few billion dollars (far less than the damage they wrought and the profits they earned on this unlawfulness) Oh, and it also resulted in exactly one arrest.

Robo-signing was conceived to deal with a quantity of scale issue — there were simply too many foreclosure files that required to much costly review for banks to pay attorneys  $300 hour to pursue them. Hence, a 90 minute, legal review might cost over $200-500 was covered instead by an $8 an hour person doing 100-200 files per hour. The math is compelling: 36 seconds of time from someone making $8 per hour = 8 cents a file. That’s more attractive than the $100s they pay for an actual legal review.

The Robo-signing scandal revealed exactly how corrupt the US banking system was, but also show the corruption of the US Treasury department, too many state Attorneys General, and a frightening swath of court rooms and judges. If I had anything good to say about the Robosignin, it was the epiphany it was for so many people perhaps the exact moment they discovered we are in fact a banana republic.

Perhaps emboldened by the costless (at least to them) destruction of centuries of US Property law and legal precedent, the bankers are pursuing a new form of legalfuckery, as revealed once again by our intrepid counsel from Maine, Thomas Cox: Behold the litigation department “Robowitness.”

A very similar person to the robosigner, only instead of doing the robosigning behind close doors, they do their dirty deeds by testifying live in person in court.

This new approach to robosigning is very different — you are not paying $8 an hour burger flippers to falsify documents — you have specifically trained witnesses testifying in open court to some very dubious data.

Judges do not like when someone under oath lies to them in their court.

This is, to my eyes an extremely risky behavior. After the testimony of the Robowitness, I believe it would take less than 20 questions of cross examination to get them to repeatedly perjure themselves. That would be part 1 of my strategy as a defense counsel. Part 2 would be working closely with judges and local prosecutors — the goal is to have the RoboWitness arrested for perjury immediately as they get off the stand.

This is a very interesting development, and warrants further observation.

 

 
Previously:
Foreclosure Fraud Reveals Structural & Legal Crisis [1] (October 5th, 2010)

The Big Lie on Fraudclosure [2] (October 29th, 2010)

Crystal Moore RoboSigning Deposition [3]  (November 14th, 2010)

 
Source:
Meet the Robo-Witnesses: Foreclosure Defense Lawyer Tom Cox on New Practices in Foreclosure Fraud [4]
David Dayen
FDL, December 13, 2012 7:45 am   
http://bit.ly/TS8rIv

 
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In addition to enormous personal satisfaction, Cox also received the $100,000 Purpose Prize [5] for this work on behalf of homeowners.

 


Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2012/12/the-newest-foreclosure-scandal-robo-witness/

URLs in this post:

[1] Foreclosure Fraud Reveals Structural & Legal Crisis: http://www.ritholtz.com/blog/2010/10/foreclosure-fraud-reveals-structural-legal-crisis/

[2] The Big Lie on Fraudclosure: http://www.ritholtz.com/blog http://www.ritholtz.com/blog/2010/10/the-big-lie-on-fraudclosure/

[3] Crystal Moore RoboSigning Deposition: http://www.ritholtz.com/blog/2010/11/crystal-moore-deposition/

[4] Meet the Robo-Witnesses: Foreclosure Defense Lawyer Tom Cox on New Practices in Foreclosure Fraud : http://news.firedoglake.com/2012/12/13/meet-the-robo-witnesses-foreclosure-defense-lawyer-tom-cox-on-new-practices-in-foreclosure-fraud/

[5] $100,000 Purpose Prize: http://www.encore.org/thomas-cox-0

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