Thursday, May 24th, 2012

Alleged Michigan mortgage fraud under FBI investigation

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Tuesday, April 26, 2011 at 10:27 am | More from The Michigan Messenger

Curtis Hertel Jr., Register of Deeds for Ingham County, says that a discovery he made involving alleged fraudulent mortgage documents is now being investigated by both the Ingham County Sheriff’s Department and the FBI.

“Yes, this is, in my opinion, fraud,” Hertel said. “This is a situation where people were forging someone else’s name to a legal document to take another person’s property. That is fraud.”

As Register of Deeds, Hertel is responsible for overseeing all the documentation of property sales in the county, including mortgage assignments. Mortgage assignments are documents that transfer ownership of a mortgage from one lending company to another.

Hertel says he was tipped off to the alleged fraud when he saw a report on CBS’ 60 Minutes. That story helped unwind the Byzantine labyrinth of paper work and investments under which the mortgages were sold as investments. But now that the banks are facing down homeowners who can’t afford the payments of their mortgage agreements, they are finding that in the rush to bundle the mortgages, there were corners cut. The original paperwork is missing.

60 Minutes uncovered a widespread program wherein people were named as vice president of various banking entities. Those people, including Linda Green, signed these documents by the dozens every day. Green, it turned out, was more desperately needed than one person could handle. Therefore people were paid $13 an hour for signing Linda Green’s name.

Green’s name was used on thousands of mortgage assignment documents in the U.S. — including here in Michigan. But in Michigan, foreclosure is simply a matter of advertising the foreclosure plan. In order for a homeowner to stop the process, a home owner would have to file suit in circuit court and receive an injunction to stop the foreclosure process and force the foreclosure agency — usually a company like Republican donor Trott and Trott — to cease the foreclosure until clear title to the property can be established.

Hertel says he identified one case in which a person was in the process of foreclosure, and the alleged fraudulent document was used. That person is preparing to fight the foreclosure with the newly discovered documentation.

Hertel tells Michigan Messenger that he has spoken with registers of deeds from at least half of the state’s 83 counties. Each register told Hertel they found allegedly fraudulent documents. In Hertel’s case, he has already identified 60 such cases in Ingham county and he has barely begun to dig through the thousands of documents being held in his office.

In addition to the investigations by the Ingham County Sheriff’s Department and the FBI,tThe story has also gotten the attention of Michigan State Sen. Steve Bieda. He serves on the Senate Judiciary Committee.

“I will be requesting that the Senate Judiciary Committee conduct an investigation on this,” Bieda tells Michigan Messenger.

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