McDonnell Property Analytics has a long history of public service dating back to 1992 when the firm’s founder, Marie McDonnell, discovered a massive mortgage fraud scheme orchestrated by the Dime Savings Bank of New York that impacted homeowners up and down the East Coast from Florida to New Hampshire. McDonnell’s audits of Dime’s complex negative amortization mortgage loans prompted Attorney General investigations in Massachusetts, New Hampshire, and Connecticut which resulted in multimillion dollar settlement awards and relief programs for consumers.
McDonnell Property Analytics has trained state and federal law enforcement and regulatory agencies regarding detection of invalid assignments, robo-signing, fraud, misrepresentation in mortgage and foreclosure instruments, the securitization of residential mortgage loans, and the intricacies of how Mortgage Electronic Registration Systems, Inc. functions.
McDonnell Property Analytics conducted the first audit of a registry of deeds in the United States for the Honorable John L. O’Brien, Register of Deeds for Essex County (Southern District), Salem, Massachusetts. McDonnell’s Report includes the following key findings: (Hyperlink to the Report)
- Only 16% of assignments of mortgage are valid.
- 75% of assignments of mortgage are invalid.
- 9% of assignments of mortgage are questionable.
- 27% of the invalid assignments are fraudulent, 35% are “robo-signed” and 10% violate the Massachusetts Mortgage Fraud Statute.
- The identity of financial institutions that are current owners of the mortgages could only be determined for 287 out of 473 (60%).
- There are 683 missing assignments for the 287 traced mortgages, representing approximately $180,000 in lost recording fees per 1,000 mortgages whose current ownership can be traced.
In 2013, McDonnell Property Analytics served as an expert witness on behalf of the Honorable Nancy Becker, Register of Deeds for Montgomery County, Pennsylvania in the matter of Montgomery County, Pennsylvania v. MERSCORP, Inc. and Mortgage Electronic Registration Systems, Inc. Ms. Becker complained that lenders who used the MERS® System were not recording assignments of mortgage in violation of the Pennsylvania Recording Statute(s). McDonnell’s expert report proved there were skips and gaps in the chain of title that supported Ms. Becker’s claims. (Hyperlink to the Report)
On September 8, 2015, McDonnell Property Analytics completed an intensive examination commissioned by the City of Seattle, which involved a review of mortgage assignments filed of record with the King County Recorder’s Office during the first half of 2013. The objective of this project was to determine whether residential real estate property assignments impacting properties within the Seattle city limits involving Mortgage Electronic Registration Systems, Inc. (MERS) were valid and in accordance with Washington State Law in light of the 2012 Washington State Supreme Court decision in Bain v. Metro. Mortg. Grp., Inc., 175 Wash.2d 83, 285 P.3d 34 (Wash., 2012).
After conducting groundbreaking research on Mortgage Electronic Registration Systems, Inc. to understand how it operates in the State of Washington, and learning that Fannie Mae (a founding principal of MERS) claims that “Even when MERS is named as the nominee for the beneficiary in the security instrument, it has no beneficial interest in the mortgage,” McDonnell Property Analytics concluded that MERS had no beneficial interest in any of the 195 related deeds of trust to assign, and therefore, the assignments were invalid. (Hyperlink to the Report)
Because of its thought leadership and innovative investigative techniques, McDonnell Property Analytics now has the tools, technologies, and know-how to identify violations of state laws that prohibit the filing of false or forged documents in the public land records. Many of these laws impose statutory penalties ranging from $5,000 to $100,000 per violation, for example:
|Arizona||A.R.S. § 33-420||$5,000|
|California||California Penal Code § 115.5||$75,000|
|Georgia||Georgia Code § 16-8-102||$100,000|
|Massachusetts||M.G.L. ch. 266 § 35A(b)(4)||$100,000|
Importantly, many cities have sued several of the country’s largest national banks for violations of the Fair Housing Act due to targeted predatory lending practices that led to a disproportionate number of foreclosures and vacancies in majority minority neighborhoods, which impaired the city’s effort to assure racial integration, diminished the city’s property-tax revenue, and increased demand for police, fire, and other municipal services.
On May 1, 2017, the Supreme Court of the United States ruled that the City of Miami had standing to sue Bank of America, N.A. and Wells Fargo Bank, N.A. under the Fair Housing Act, but cautioned the City must be able to prove that the Banks’ acts were the proximate cause of the City’s injuries. (Visit link: Bank of Am. Corp. v. City of Miami)
McDonnell Property Analytics is uniquely qualified to assist cities such as Miami to conduct a public records search for foreclosed properties; identify the predatory characteristics that led to foreclosure; and to assess the impact foreclosures, vacancies, and abandoned properties had on the tax base.
We welcome the opportunity to work with your government group. Please feel free to call us (774) 323-0892 | Or send us a note below.