LexisNexis Pick for Chinese Drywall Filings

post from Housing Wire on 18 August 2009 05:58:20 PM. © Housing Wire

Lawyers involved in the massive Chinese drywall litigation pending in US District Court will use LexisNexis File & Serve system for document exchange, and case-file access and storage for all cases.All federal cases involving the drywall ? which was used during the housing construction boom and is alleged to contain dangerous levels of sulfur that?s [...]

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SoCal Sales Up, Prices Still Down; MDA DataQuick

post from Housing Wire on 18 August 2009 05:28:44 PM. © Housing Wire

Southern California posted the best July sales volume in three years and the fastest pace of any month since December 2006.But as volume saw double-digit increases in all but one of the six Southern California counties, median prices saw double-digit declines from 2008 levels in the same number of counties.A total of 24,104 new and [...]

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Toronto Real Estate Board reports:

post from Toronto Real Estate Blog on 18 August 2009 05:05:00 PM. © Toronto Real Estate Blog

August Mid-Month Residential Resale Market Figures. In the first two weeks of August, Greater Toronto Realtors reported 3,832 sales ? up 27 per cent compared to the first two weeks of August 2008. The average price for these transactions was...

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Indianapolis man order to stop committing fraud
as a loan broker

post from Daily Mortgage Fraud News on 18 August 2009 05:05:00 PM. © Daily Mortgage Fraud News

In the following press release Indiana Attorney General Greg Zoeller announced that a man who has been promoting himself to Hoosiers as a licensed real estate broker and investor has been ordered by the state of Indiana to stop immediately. Majik Moore of Indianapolis has agreed to a preliminary injunction which bars him from operating as a real estate broker or a credit service counselor.

Additionally, Indiana Secretary of State Todd Rokita’s Securities Division today issued a cease-and-desist order against the Indianapolis resident after finding several instances of Moore operating as an unlicensed loan broker and selling an unregistered security without a license. Specifically, Moore is ordered to immediately cease and desist selling unregistered securities, selling securities as an unregistered broker-dealer, brokering loans as an unlicensed loan broker, and committing fraud in connection with the services of a loan broker.
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The attorney general’s Homeowner Protection Unit (HPU) filed a lawsuit against Moore on July 23 in Marion County Superior Court. The lawsuit identifies at least 18 victims who each described paying Moore between $4,500 and $9,000 for real estate or investment related transactions. At least two of Moore’s victims have lost their homes to foreclosure as a result of the monetary losses or because Moore allegedly advised them not to make mortgage payments.

“The economy has created opportunities and pitfalls. We have many first time home buyers who are able to enter the real estate market while other families struggle to pay their mortgages on homes that were purchased before the housing bubble burst,” Zoeller said. “Unscrupulous people will prey on consumers unfamiliar with the real estate system and those in financial distress looking for help. It’s a unique situation to have these two distinct groups as victims, and through no fault of their own, they are caught in a web of deceit.”

“We want the public to know that this man, Majik Moore, is not a licensed mortgage broker in Indiana, nor is he licensed to sell securities in Indiana,” Rokita said. “The cease-and-desist order is the first step in the administrative process, but by no means our last step in seeking justice for the victims.”

The injunction Moore agreed to Thursday requires Moore to refrain indefinitely from performing any duties as a real estate broker in Indiana without the proper licensing. Moore also has agreed to stop offering credit services unless he complies with Indiana law. A $25,000 surety bond is required if an operator collects fees up front.

Also named in the attorney general’s lawsuit are three companies Moore operates including Got Cha Bak, Inc., Hyland Realty, Ltd., and Forestar Financial Services. The companies have no known employees and Moore is the sole principal. Got Cha Bak and Hyland Realty are also named on the Secretary of State’s cease-and-desist order and neither company is registered with the state’s Securities Division, as the law requires.

The Secretary of State’s Securities Division received allegations from six victims in the Indianapolis area who value their losses at nearly $25,000.

“We are pleased that Moore has agreed to refrain from his unlawful practices and from violating Indiana law. By agreeing to stopping his illegal actions, future Hoosiers will not suffer the same fate as the Hoosiers discussed in the State’s complaint,” said Gabrielle J. Owens, Section Chief of the Attorney General’s Professional Licensing and Homeowner Protection Unit.

To report a deceptive real estate transaction, credit services transaction or violation committed by a licensed professional in Indiana, submit a consumer complaint online at www.IndianaConsumer.com or contact the Consumer Protection Division at 317-232-6330 or toll free at 1-800-382-5516. For more information on how to avoid becoming a victim of investment fraud, visit www.IndianaInvestmentWatch.com.

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Fitch Ratings Steps Up Probe into Commercial
Mortgage Exposure

post from Housing Wire on 18 August 2009 04:45:51 PM. © Housing Wire

Fitch Ratings expanded its analysis of commercial real estate (CRE) as the performance metrics “deteriorate at an unprecedented pace.”As part of the broader analysis, Fitch issued surveys to more than 75 US bank and thrift institutions it rates, requesting more details on the firms’ exposure to CRE. Details sought include collateral type, geography, internal risk [...]

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Lehman Brothers, RTC Veterans Launch $1.5bn REO
Fund

post from Housing Wire on 18 August 2009 04:08:32 PM. © Housing Wire

Richard Stewart Jr., chairman and CEO of Heritage Capital Resources, and Peter Monroe, CEO and founder of National Real Estate Ventures, on Tuesday announced they formed a $1.5bn joint venture to buy and sell distressed residential real estate-owned (REO) assets.The new $1.5bn fund’s co-founders bring a history in mortgages and financial regulation. Stewart, previously vice [...]

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Ventura realtor pleads guilty in real estate
investment scheme

post from Daily Mortgage Fraud News on 18 August 2009 03:58:00 PM. © Daily Mortgage Fraud News

In the following press release Ventura County District Attorney Gregory D. Totten announced that Veronica Sanchez Gallegos (10/30/80), a licensed real estate agent residing in Ventura , pled guilty on August 6, 2009, to one felony count of theft from an elder, five felony counts of grand theft, and admitted a special allegation of taking more than $500,000.

In an investigation conducted by the District Attorney’s Office Bureau of Investigation, it was determined that Gallegos conducted a fraudulent investment scheme where six victims entrusted her with a total $1,289,000. Victims invested money with Gallegos after relying on false assurances made by Gallegos that their investments were being pooled into short term construction, real estate, and similar “secured” loans by a corporation named Equity One and were protected by an escrow fund in the event of default. Gallegos made other false representations including that she was an “Accredited Investor” as defined by the Securities and Exchange Commission, earned income in excess of $200,000 per year, had a net worth in excess of one million dollars and that she personally guaranteed every investment.

One 65 year-old victim invested the bulk of his life savings for a total of $284,000 and suffered a net loss of $244,000. Other investors invested amounts ranging from $40,000 to $622,000. Investors typically responded to e-mail solicitations from Gallegos where they were promised returns of principal plus monthly payments and thousands of additional dollars. For example, one investor gave $68,000 to Gallegos in exchange for a “loan agreement” promising the payment of $1,041 per month for 24 months, followed by a payment of $80,500, with ten percent interest charged on any amounts not paid in full. While some investors did receive a small proportion of their funds back, the net losses suffered by all investors are estimated at $1,238,706.

Gallegos operated under business names Home Center Realty and Loans and Home Center Loans of Ventura. The investigation revealed that such businesses handled very few legitimate real estate transactions. To date, no funds have been recovered and it appears that the proceeds were spent by Gallegos. In one instance, the day after receiving $193,000 from one investor, Gallegos used $25,000 to purchase a truck from a local auto dealer. Gallegos admitted the wrongful conduct, expressed remorse for the victims and indicated that she will accept responsibility for her actions.

Gallegos faces a maximum prison term of 12 years, 4 months. Her sentencing hearing is set for October 7, 2009 before Superior Court Judge Edward Brodie. Gallegos remains out of custody on $30,000 bail pending the sentencing hearing.

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High-Frequency Smackdown: Durden vs Levitt

post from Housing Doom on 18 August 2009 03:36:00 PM. © Housing Doom

… the fundamental question is whether the extensive stock churn that is controlled by a select few who have the means for a positive IRR* on such an investment to take advantage of the windfalls, is merited especially in light of the oligopolistic nature of the HFT landscape. One needs merely to look at how promptly the Misha Malyshev led Teza was ejected from the ranks of the HFT players after what will soon evolve to be a fabricated scandal using Sergey Aleynikov as its primary pawn. [1] — WARNING: commenter complaints of aggressive banner ad &/or site exploit in progress at Seeking Alpha; as an alternative ZeroHedge has it posted here; *IRR == internal rate of return

I’m inclined to subscribe to that "fabricated scandal" scenario. After end-of-world scenarios that led the FBI and federal courts on a wild goose chase over the July 4th weekend, delays and negotiations have coagulated into a dying [2] fall [3] that looks engineered to sputter out over the Labor Day weekend.

At issue here is a WSJ op-ed [4] and defense of high-frequency trading by former SEC Chairman Arthur Levitt. Opposed to Levitt is Tyler Durden, founding persona of ZeroHedge, an anonymous blogging collective. As well as the above comment on what the Aleynikov affair means, they engaged Levitt’s pro-HFT arguments and suggested that he might also have some conflicting interests on this matter (links-of-fire were in the, obviously lightly edited, original).

… The "toll" collected by the few HFT vendors out there has been shown to be a substantial number: is it any surprise that Mr. Levitt vocal defense of an increasingly more spotlighted HFT comes at a time when he as advisor not only to HFT provider Getco but also to primary NYSE PT monopolist Goldman Sachs. Granted, Mr. Levitt does not disclose these conflicts of interest in his piece - perhaps the information would be seen in a slightly different light were that to be the case. …

Most of the outraged earlier voices on this story arc have been quiet lately and Matt Goldstein, the MSM’s point-man on this beat went suddenly black 4 days ago. Let’s hope that’s simply a very well earned break after an intense summer that started when he broke this story wide open on 7/7. Doom will be eagerly awaiting his reappearance.

Four weeks ago one of the ZeroHedge personas launched a profanity-laden rant [5] at institutional fiduciaries. If you strip out the pottie language it reads a bit like prophecy. They see processes that are systematically stripping society of its wealth and lining the pockets of the few, and they are taking the opportunity of an anonymous collective to proclaim this to the rafters.

Actually, that’s also my view of HFT. I read that first quote above and see in my mind’s eye a Frankenstein’s Monster wired up in a secret laboratory in Mahwah, NJ, being pumped chock full of electronic dollars until he awakens as a sort of 21st Century J. P. Morgan to rule over the financial universe.

Unfortunately, even now that quote is going to read like complete gobbledygook for most people. Not to mention Levitt getting to broadcast at 55 dB above what Durden does. Fortunately, that’s not going to mean much once the historians get around to sorting out this mess.

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[1]: "Arthur Levitt Defends High Frequency Trading", by Tyler Durden, Seeking Alpha, August 18, 2009. [please read the WARNING near the top of this article]

[2]: "Talks extended in ex-Goldman programmer theft case", by Grant McCool, Reuters, August 3, 2009.

NEW YORK (Reuters) - The lawyer for a former Goldman Sachs Group Inc computer programer facing criminal charges of stealing trade secrets from the firm is in talks with a U.S. prosecutor on a possible resolution of the case, court documents said on Monday.

[3]: "Ex-Goldman programmer eyes dismissal", by Jonathan Stempel, Reuters, August 17, 2009.

NEW YORK (Reuters) - A federal judge has granted more time for the government to seek an indictment against or work out a settlement with a former Goldman Sachs Group Inc programer accused of stealing trade secrets, after the programmer’s lawyer said she wants the case dismissed.

[4]: "Don’t Set Speed Limits on Trading: Why penalize efficiency? It creates deep and liquid markets", by Arthur Levitt Jr., Wall Street Journal, August 17, 2009.

High-frequency trading is, in many respects, just the next stage in the ongoing technological innovation of financial markets. Just as paper tickets for trades were replaced by computer orders, and the trading floor seen on television was made largely irrelevant by electronic exchanges, so has high-frequency trading revolutionized the way most U.S. stocks and related investment products are priced and sold.

[5]: "An Open Letter to Pension, Endowment, and Other Institutional Trustees and Investment Committees", ZeroHedge, July 20, 2009.

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Wolters Kluwer Launches RESPA Tool Box

In advance of the new requirements added to the Real Estate Settlement Procedures Act (RESPA) that take effect January 1, 2010, the Minneapolis-based Wolters Kluwer Financial Services launched its RESPA Tool Kit to help financial institutions understand and implement the changes.The software provides an overview of the Department of Housing and Urban Development’s (HUD) changes, [...]

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Developer Launches Portfolio Software

San Diego-based software developer xplair Technology launched a Web-based residential mortgage portfolio management platform to provide asset data and analytics to financial institutions.The software provides direct feeds to loan and real estate owned (REO) asset data, along with comparative analytics, risk metrics and interactive charting.The software uses a customizable ?dashboard? that provides real time portfolio [...]

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