FORECLOSURES - MERS Is Dead: Can Be Sued For Fraud

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MERS Is Dead: Can Be Sued For Fraud: WA Supreme Court

Posted By: Maryhrt [Send E-Mail]
Date: Thursday, 27-Sep-2012 10:16:24

A win for the people. This should have a tremendous backlash in the foreclosure arena. http://dailybail.com/home/mers-is-dead-can-be-sued-for-fraud-wa-supreme-court.html ========= Countdown to banks forcing Congress to protect MERS in 3,2,1... --- State Court Ruling Deals Body Blow to MERS Reprinted with permission. (Reuters) - The highest court in the state of Washington recently ruled that a company that has foreclosed on millions of mortgages nationwide can be sued for fraud, a decision that could cause a new round of trouble for the nation's banks. The ruling is one of the first to allow consumers to seek damages from Mortgage Electronic Registration Systems, a company set up by the nation's major banks, if they can prove they were harmed. Legal experts said last month's decision from the Washington Supreme Court could become a precedent for courts in other states. The case also endorsed the view of other state courts that MERS does not have the legal authority to foreclose on a home. "This is a body blow," said consumer law attorney Ira Rheingold. "Ultimately the MERS business model cannot work and should not work and needs to be changed." Banks set up MERS in the 1990s to help speed the process of packaging loans into mortgage-backed bonds by easing the process of transferring mortgages from one party to another. But ever since the housing crash, MERS has been besieged by litigation from state attorneys general, local government officials and homeowners who have challenged the company's authority to pursue foreclosure actions. A spokeswoman for MERS said the company is confident its role in the financial system will withstand legal challenges. The Washington Supreme Court held that MERS' business practices had the "capacity to deceive" a substantial portion of the public because MERS claimed it was the beneficiary of the mortgage when it was not. This finding means that in actions where a bank used MERS to foreclose, the consumer can sue it for fraud. If the foreclosure can be challenged, MERS' involvement would make repossession more complicated. On top of that, virtually any foreclosed homeowner in the state in the past 15 years who feels they have been harmed in some way could file a consumer fraud suit. http://dailybail.com/home/mers-is-dead-can-be-sued-for-fraud-wa-supreme-court.html