Sunday, December 22, 2013

We Have A Moral Obligation To Fix US Inequality, Orwell Triumphs Regretted As Gov't Lies and Warrantless Wiretapping Continues, and More Cass Sunstein Legerdemain For the Unseeing Masses (Or Will It Ricochet)? Bankers Now Sitting In Barber Chair (Waiting for Trim?) Just A Quick Haircut As BoA Foreclosure Scams Revealed (Rape Victims Names Now A Commodity)

Robert Reich has a Christmas message for US.

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Ninety-five percent of economic gains since 2009 have gone to the 1 percent. We have a moral obligation to fix this.

It’s the season to show concern for the less fortunate among us. We should also be concerned about the widening gap between the most fortunate and everyone else.

the biggest lottery of all is what family we’re born into. Our life chances are now determined to an unprecedented degree by the wealth of our parents.

That’s not always been the case. The faith that anyone could move from rags to riches – with enough guts and gumption, hard work and nose to the grindstone – was once at the core of the American Dream.

And equal opportunity was the heart of the American creed. Although imperfectly achieved, that ideal eventually propelled us to overcome legalized segregation by race, and to guarantee civil rights. It fueled efforts to improve all our schools and widen access to higher education. It pushed the nation to help the unemployed, raise the minimum wage, and provide pathways to good jobs. Much of this was financed by taxes on the most fortunate.

But for more than three decades we’ve been going backwards. It’s far more difficult today for a child from a poor family to become a middle-class or wealthy adult. Or even for a middle-class child to become wealthy.

The major reason is widening inequality. The longer the ladder, the harder the climb. America is now more unequal that it’s been for eighty or more years, with the most unequal distribution of income and wealth of all developed nations. Equal opportunity has become a pipe dream.

Rather than respond with policies to reverse the trend and get us back on the road to equal opportunity and widely-shared prosperity, we’ve spent much of the last three decades doing the opposite.

Taxes have been cut on the rich, public schools have deteriorated, higher education has become unaffordable for many, safety nets have been shredded, and the minimum wage has been allowed to drop 30 percent below where it was in 1968, adjusted for inflation.

Congress has just passed a tiny bipartisan budget agreement, and the Federal Reserve has decided to wean the economy off artificially low interest rates. Both decisions reflect Washington’s (and Wall Street’s) assumption that the economy is almost back on track.

But it’s not at all back on the track it was on more than three decades ago.

It’s certainly not on track for the record 4 million Americans now unemployed for more than six months, or for the unprecedented 20 million American children in poverty (we now have the highest rate of child poverty of all developed nations other than Romania), or for the third of all working Americans whose jobs are now part-time or temporary, or for the majority of Americans whose real wages continue to drop.

How can the economy be back on track when 95 percent of the economic gains since the recovery began in 2009 have gone to the richest 1 percent?

The underlying issue is a moral one: What do we owe one another as members of the same society?

Well, we could have asked Ronald Reagan (see link below) when he started the nonsense of nobody-at-the-top-owing-anyone-below-anything meme (remember the so-popular "welfare queens in their cadillacs") in order to benefit his wealthy backers' plans . . . but no one in the media ever did (successfully).

How America Abandoned Its “Undeserving” Poor

With poverty on the rise in the late 1970s, Reagan conservatives waged war on the needy — and won

I've read many of George Orwell's works, including his poetry, because he was not only a truly gifted writer (and thinker par excellence), but he wrote in many differing genres that provide a wide landscape of information about the man who tried to alert his fellow citizens to the dangers inherent in the rise of the totalitarians after Hitler (and before).

Not much has changed since Orwell's time. Some think we've finally arrived at the proper recognition of how Orwell's vision of "1984" enwrapped us internationally under the cloak of "national security." Pigs rule. People are "terrorized."

Presenting the Orwellian sounding “Liberty and Security in a Changing World” report created for the Obama administration in the wake of the Edward Snowden psyop by a small group of hand-picked advisers including Cass Sunstein, Richard Clarke and Michael Joseph Morell.

The actual report was released early by the Obama administration. They released it today. It’s full of lofty sounding rhetoric, like Obama’s speeches. However, as in his speeches, if you ignore the lip-service he’s paying to his dwindling base and pay close attention to the detail while keep(ing) it in context of other current events, you should get a pretty good picture of what is happening and who is going to benefit from it.

It’s not you by the way who will benefit nor your privacy as they privatize bulk data collection and reserve the right for them to refuse to disclose anything if it hampers that all important “national security” thing they got going.

The New York Times Reminds Us the NSA Still Warrantlessly Wiretaps Americans, and Congress Has the Power to Stop It

By Trevor Timm: Last week, the New York Timespublished two important op-eds highlighting how the National Security Agency (NSA) has retained expansive powers to warrantlessly wiretap Americans after Congress ...

And lately:

“Almost Orwellian” – that’s the description a federal judge gave earlier this week to the massive spying by the National Security Agency (NSA) on virtually all 380 million cellphones in the United States.

In the first meaningful and jurisdictionally grounded judicial review of the NSA cellphone spying program, U.S. District Court Judge Richard Leon, a George W. Bush appointee sitting in Washington, D.C., ruled that the scheme of asking a secret judge on a secret court for a general warrant to spy on all American cellphone users without providing evidence of probable cause of criminal behavior against any of them is unconstitutional because it directly violates the Fourth Amendment.

. . . The Framers intended (the Fourth Amendment) to prevent the new government in America from doing to Americans what the British government had done to the colonists under the king.

The British government had used general warrants – which are not based on individualized probable cause and do not name the place to be searched or the person or thing to be seized – to authorize British soldiers to search the colonists wherever they pleased for whatever they wished to seize. The reason for the Fourth Amendment requirement of individualized probable cause and specificity in the warrant is to prevent the very type of general warrant that the NSA has claimed is lawful. The reason for preventing general warrants is that they have become an instrument of tyranny.

The following paragraphs are a perfect lead-in to the essay below on the latest Cass Sunstein runaround.

Just in case you needed to get even more exercise(d).

Has Morley Safer Ever Told John Miller This Story?: 'Look, If You Think Any American Official Is Going to Tell You the Truth, Then You're Stupid'

Everyone who watched the 60 Minutes segment on the NSA should follow it up with this story involving Morley Safer — who, at 82 years old, is still a correspondent at 60 Minutes:

In August, 1965 Safer appeared in what became one of most famous TV segments of the Vietnam War, showing U.S. troops setting fire to all the huts in a Vietnamese village with Zippo lighters and flamethrowers.

A year later in 1966, Safer wrote an article about what he'd seen first hand during a visit to Vietnam by Arthur Sylvester, then Assistant Secretary of Defense for Public Affairs (i.e., the head of Pentagon PR). Sylvester met at the U.S. Embassy in Saigon with reporters for U.S. news outlets:

There was general opening banter, which Sylvester quickly brushed aside. He seemed anxious to take a stand — to say something that would jar us. He said:

"I can't understand how you fellows can write what you do while American boys are dying out here," he began. Then he went on to the effect that American correspondents had a patriotic duty to disseminate only information that made the United States look good.

A network television correspondent said, "Surely, Arthur, you don't expect the American press to be the handmaidens of government."

"That's exactly what I expect," came the reply.

An agency man raised the problem that had preoccupied Ambassador Maxwell Taylor and Barry Zorthian — about the credibility of American officials. Responded the Assistant Secretary of Defense for Public Affairs:

"Look, if you think any American official is going to tell you the truth, then you're stupid. Did you hear that? — stupid."

One of the most respected of all the newsmen in Vietnam — a veteran of World War II, the Indochina War and Korea — suggested that Sylvester was being deliberately provocative. Sylvester replied:
"Look, I don't even have to talk to you people. I know how to deal with you through your editors and publishers back in the States."
At this point, the Hon. Arthur Sylvester put his thumbs in his ears, bulged his eyes, stuck out his tongue and wiggled his fingers.

And speaking of Orwell and the term Orwellian . . . (it almost makes me think none of these people ever took a history (let alone, English) course), think back to the revelations about our own Soviet-throwback, apocrypha-laden, wise man/guy, "noted thinker" Cass Sunstein. Wonder where he's been and who's been paying him ever since?

He's not out of D.C., and has never left the fray.

And he's been deeply engaged at work turning out the latest Obama newspeak errr - recommendations for handling the NSA Snowjob blowback. And it won't blow back on them if these "recommendations" become the received knowledge.

The Cass Sunstein-Led Group Report Recommendations (PDF)

Posted on December 18, 2013 by willyloman

by Scott Creighton

Presenting the Orwellian sounding “Liberty and Security in a Changing World” report created for the Obama administration in the wake of the Edward Snowden psyop by a small group of hand picked advisers including Cass Sunstein, Richard Clarke and Michael Joseph Morell.

(Please read: Cass Sunstein and CIA Director at Time of the Leak are the Advisers Fixing the “Crisis” Caused by Snowden Psyop  )

The actual report was released early by the Obama administration. They released it today. It’s full of lofty sounding rhetoric, like Obama’s speeches. However, as in his speeches, if you ignore the lip-service he’s paying to his dwindling base and pay close attention to the detail while keep it in context of other current events, you should get a pretty good picture of what is happening and who is going to benefit from it.

It’s not you by the way who will benefit nor your privacy as they privatize bulk data collection and reserve the right for them to refuse to disclose anything if it hampers that all important “national security” thing they got going.

“In addition, the panel proposed terminating the NSA’s ability to store telephone data and instead require it to be held by the phone companies or a third party.” AP

Yes, it would seem that the privatization of bulk data collection is the main focus of the Sunstein group report. Obviously this will turn all that “metadata” (and the other forms of data they expressly discuss (recording and transcripts of emails, texts, etc.) into a commodity, wholly owned by the various companies that collect it such as AT&T, Verizon, Google, and others

“With respect to surveillance of US Persons, we recommend a series of significant reforms. Under section 215 of the Foreign Intelligence Surveillance Act (FISA), the government now stores bulk telephony metadata, understood as information that includes the telephone numbers that both originate and receive calls, time of call, and date of call. (Meta-data does not include the content of calls.). We recommend that Congress should end such storage and transition to a system in which such metadata is held privately for the government to query when necessary for national security purposes

Recommendation 4 : We recommend that, as a general rule, and without senior policy review, the government should not be permitted to collect and store all mass, undigested, non-public personal information about individuals to enable future queries and data-mining for foreign intelligence purposes. Any program involving government collection or storage of such data must be narrowly tailored to serve an important government interest.”

Recommendation 5 : We recommend that legislation should be enacted that terminates the storage of bulk telephony meta-data by the government under section 215, and transitions as soon as reasonably possible to a system in which such meta-data is held instead either by private providers or by a private third party. Access to such data should be permitted only with a section 215 order from the Foreign Intellience Surveillance Court that meets the requirements set forth in Recommendation 1″ As you can see from recommendation 4 and 5, these are two different categories of data being collected. “Undigested, non-public, personal information” is one category and “telephony meta-data” is another. Meta-data would certainly be processed or “digested”. What wouldn’t be would be actually recordings of calls or email transcripts. It’s unclear as too what justification the government would need to collect and store such information that would be “narrowly tailored” for some “government interest”
And lets not forget this recent gem:

“In their most concerted response yet to disclosures by the National Security Agency whistle-blower Edward Snowden, Apple, Google, Microsoft, Facebook, Yahoo, LinkedIn, Twitter and AOL have published an open letter to Barack Obama and Congress on Monday, throwing their weight behind radical reforms already proposed by Washington politicians.” The Guardian

Why is it that these companies are so determined to see something like this enacted? Who do you think will be collecting, storing and commodifying all that data?

Can you say “the next bubble crisis”? Can you say “new derivatives markets”?

As too all that “transparency” they are beaming about on other news services. Don’t bet on it.

There is a recommendation which deals explicitly with provisions which would enable the government to ignore requests to see what information is being collected and for what reasons.

Recommendation 8: We recommend that: (1) legislation should be enacted providing that, in the use of National Security Letters, section 215 orders, pen register and trap-and-trace orders, 702 orders, and similar orders directing individuals, businesses, or other institutions to turn over information to the government, non-disclosure orders may be issued only upon a judicial finding that there are reasonable grounds to believe that disclosure would significantly threaten the national security, interfere with an ongoing investigation, endanger the life or physical safety of any person, impair diplomatic relations, or put at risk some other similarly weighty government or foreign intelligence interest;”
I think the only crime not covered under that all inclusive rubric would be one involving a kid shoplifting candy from a 7-11. But don’t hold me too that.

Basically what this allows for is the government to keep massive amounts of bulk data collections secret for any number of BS reasons they feel they can come up with. So there goes your transparency. All they have to say is they are collecting mass amounts of data on folks and they can’t disclose what and who because it might threaten their ongoing investigation and thus cause a risk to our “national security”

Of they can simply say they can’t disclose the data mining because it might impair our relationship with a foreign country . . . like Israel for example.

Whatever the lame excuse, transparency is not a given here. But don’t worry, Big Brother’s highest Party Members will be making the decisions and you can trust them… right?

Recommendation 11We recommend that the decision to keep secret from the American people programs of the magnitude of the section 215 bulk telephony meta-data program should be made only after careful deliberation at high levels of government and only with due consideration of and respect for the strong presumption of transparency that is central to democratic governance. A program of this magnitude should be kept secret from the American people only if (a) the program serves a compelling governmental interest and (b) the efficacy of the program would be substantially impaired if our enemies were to know of its existence”
See? They can keep all this secret from you if it serves a “compelling interest” of the people doing it.

There’s about 29 or so more recommendations from this Sunstein group that they claim are in response to the Snowjob affair which I suggest people read on their own. The group’s recommendations are not written in stone and they will certainly be modified in the next couple of weeks as the new CISPA is molded and shaped in the wake of the Greenwald snowjob.

Other fronts are being employed to this endeavor.

The same guy who wrote the Patriot Act has written another Orwellian sounding piece of legislation called the “USA Freedom Act”. They got the ACLU behind that sale’s pitch.

And of course, Jay Rockefeller (yes, of THOSE Rockefellers) has attached a rider to the new NDAA 2014 bill:

“Jay Rockefeller (D WVA) has attached a cyber-security amendment (I attached it below) to the NDAA 2014 bill in Congress to mandate that precautions be taken to protect America’s cyber infrastructure and private entities. Those of us who represent private entities, will soon find our free access to the internet eliminated. The fact that this internet control bill is attached to the NDAA is no accident because this means that dissidents, posting anti-government rhetoric on the internet, can be snatched off the street and held indefinitely for their “terrorist” views.” Blacklisted News
You can download and read the “Liberty and Security in a Changing World” report for yourself.



brian, on December 19, 2013 at 4:50 am said:

Thinking of the logistics to all of this (of which I am certainly no expert) I just wonder if these proposals reflect what has been going on all along…

. . . compare this from above ¨(…) Yes, it would seem that the privatization of bulk data collection is the main focus of the Sunstein group report. Obviously this will turn all that “metadata” (and the other forms of data they expressly discuss (recording and transcripts of emails, texts, etc.) into a commodity, wholly owned by the various companies that collect it such as AT&T, Verizon, Google, and others.¨

. . . with this: ¨Surveillance State is the inevitable development of a corporate-controlled Internet. Today some 70% of the NSA budget goes to corporations, which routinely implement computer programs that are hidden from the public as “proprietary information.” It’s not much of a jump from privatized and hidden corporate systems to privatized and hidden state surveillance systems
What I mean is the tools are certainly already in private hands where no bulk data would have to be turned over really but just be kept in place, safeguarded and finalized by legalese.
It looks like this time the NSA is just a front for the corporates using their mantra of the ¨War on terror¨. Wouldn’t be surprised if at NSA HQ all they did was mopping floors.
willyloman, on December 19, 2013 at 8:19 am said:

It’s been privatized to an extent for a long time I would imagine. The collection of the data that is. Tice (I think it was him) told us how he installed routing lines into a special room on behalf of AT&T (I think it was) years ago (2006?)

The difference I think is that the “meta-data” will be collected, stored, processed, sifted through, flagged for further actions and eventually even marketed by these companies. Thin(k) about the sheer size of this pool of data and what it could be used for other than “national security”
Well, naturally, with the laws as they are, they can’t do that now legally and therefore they can’t create derivatives and CDS with it because legally they don’t have it and don’t own it.

Winston (K) Smith, on December 19, 2013 at 9:25 am said: 

So does the primary drive of all of the big Snowden game boil down to legalizing the packaging up different combinations of personal data and personal histories into new financial instruments to be gambled on like mortgages? How much does the Non-Sense Agency really have to do with this effort compared to the financial/corporate industry? Remember about ten years ago when there was a DARPA – sponsored effort to start a terrorism futures market to help “predict political upheaval in the Middle East”?

Of course, DARPA scrapped the project because of its obvious potential for embarrassment. What may not have been as widely publicized is that the directors at DARPA got worried and had program managers bring any funded effort with a potentially sensitive name before them for “review”. All of them were immediately terminated without review (because that’s easier than evaluating I suppose) to be on the safe side and avoid scandal.

People and groups with projects both questionable and useful lost their funding with no recourse. While some of this may not have been bad (except for legitimate programs being canceled without review), I’m afraid many projects get funded as arbitrarily and with as little review as these got cancelled.

Remember MKUltra? It was “cancelled” because after becoming the biggest budget for the entire Corporate Infrastructure Agency, nobody could even track where the money was going!

Winston(K) Smith, on December 19, 2013 at 10:41 am said:

Something that is probably relevant to this discussion: The GAO has just put out a short report called “INFORMATION RESELLERS Consumer Privacy Framework Needs to Reflect Changes in Technology and the Marketplace” addressed to Rockefeller as the chairman of Committee on Commerce, Science, and Transportation:

Talk about regulation (mostly lack thereof) of third-party resellers of bulk personal data.

Warning: There’s an embedded document in it called GAO-v9.joboptions – I have no idea what it is or if it’s a problem – probably not, but just an FYI.

As if you need any more data about how we're manipulated by the banksters and their minions, there's always DealBreaker's rare insights:

16 Dec 2013

    Former UBS Banker-cum-Fugitive Will Probably Starting Naming Tax Evading Names: Guy

    By Bess Levin

    Raoul Weil, the former head of UBS AG’s global wealth management business accused of conspiring to help Americans evade taxes, was ordered to post bail of $10.5 million before trial, according to a court filing. Weil, 54, appeared today in federal court in Fort Lauderdale, Florida, for the first time since he was indicted in October 2008 and declared a fugitive. U.S. Magistrate Judge Patrick Hunt said Weil must post a $9 million personal surety bond with a cash deposit of $4 million, as well as a $1 million corporate surety bond and a $500,000 personal surety bond, according to minutes of the hearing.

    Weil’s lawyer has said he is innocent. He is the highest-ranking banker among about 100 people charged since 2008 by the U.S. in a crackdown on offshore tax evasion. About three dozen foreign bankers, lawyers and advisers were charged. Tax lawyers not involved in the case said they expect Weil to plead guilty, cooperate with prosecutors, and seek leniency at sentencing. “There’s a good chance he’ll be ready to cooperate, and he’ll be throwing his people under the bus,” said attorney Edward Robbins of Hochman, Salkin, Rettig, Toscher & Perez in Beverly Hills, California. “He knows where all the dead bodies are. To the extent that the government missed any, he can tell them where they are.”

    Christmas Come Early For JP Morgan Junior Employees

    by Bess Levin | December 16, 2013

    Back in the day, as in pre-2008, attempts to make the job of a Wall Street junior banker slightly more palatable would have been laughed off as crazy and unnecessary. The main reason was that any complaints to management about treating young employees like indentured servants could be met with: “Yeah . . .but you’re/they’re making a ridiculous . . .

    Read more »

    Instead of helping homeowners as promised under agreements with the U.S. Treasury Department, Bank of America stalled them with repeated requests for paperwork and incorrect income calculations, according to nine former Urban Lending employees. Some borrowers were sent into foreclosure or pricier loan modifications padded with fees resulting from the delays, according to the people, all but two of whom asked to remain anonymous because they signed confidentiality agreements.

    HAMP was the centerpiece of President Barack Obama’s attempt to prevent foreclosures by lowering distressed borrowers’ mortgage payments. Under the program, homeowners are given trial modifications to prove they can make reduced payments before the changes become permanent.

    The accounts of the former employees help explain why Obama’s plan fell far short of the 3 million averted foreclosures targeted in 2009. Relying on the same industry that sold shoddy mortgages during the housing bubble and improperly sped foreclosures afterward, HAMP resulted in still-active modifications for 905,663 homeowners as of the end of August, or 13 percent of the 6.9 million people who applied.

    Secret Inside BofA Office of CEO Stymied Needy Homeowners [Bloomberg]

    By Hugh Son Dec 16, 2013 203 Comments 

    Isabel Santamaria thought she finally caught a break in her effort to save her Florida home from foreclosure after nine frustrating months: She reached Bank of America Corp.’s Office of the CEO and President.

    What the mother of two autistic children didn’t know is that her case would find its way to contractors, including Urban Lending Solutions in Broomfield, Colorado, far from the bank’s headquarters in Charlotte, North Carolina. Bank of America hired the firm founded by Chuck Sanders, a former Pittsburgh Steelers running back, to clear a backlog of complaints about a federal program designed to prevent foreclosures.

    “It felt like a big deal, reaching the CEO’s office,” Santamaria, 43, said of having her June 2010 call escalated to what she was told was the bank’s top level. “It only happened because I complained to my congressman, the attorney general, television stations. They only put you there if you make a big stink, but once you’re there, they still don’t help you.”

    Bank of America, led by Chief Executive Officer Brian T. Moynihan, faced more than 15,000 complaints in 2010 from its role in the government’s Home Affordable Modification Program. Urban Lending, one of the vendors brought in to handle grievances from lawmakers and regulators on behalf of borrowers, also operated a mail-processing center for HAMP documents.

    Paperwork Requests

    Instead of helping homeowners as promised under agreements with the U.S. Treasury Department, Bank of America stalled them with repeated requests for paperwork and incorrect income calculations, according to nine former Urban Lending employees. Some borrowers were sent into foreclosure or pricier loan modifications padded with fees resulting from the delays, according to the people, all but two of whom asked to remain anonymous because they signed confidentiality agreements.

    Countrywide Managers

    Bank of America stands out in a program that lawmakers and former Federal Deposit Insurance Corp. Chairman Sheila Bair have called a failure, leaving many homeowners worse off. The second-largest U.S. lender canceled more trial modifications than any mortgage firm and sent the highest percentage of rejected customers into foreclosure, Treasury data show.

    (Click on figure to enlarge.)

    To help run its modification program, Bank of America relied on managers who had worked at Countrywide Financial Corp., the subprime lender it took over in 2008. Those executives created and enforced quotas for resolving complaints, according to the former employees. Among them was Rebecca Mairone, found liable by a federal jury in October for defrauding government-backed housing companies Fannie Mae and Freddie Mac while working at Countrywide.

    Urban Lending staff, struggling to meet those quotas, resorted to falsifying records and improperly purging complaints, the people said. They sent letters containing inaccurate statements on Office of the CEO and President stationery to lawmakers and U.S. agency officials who sought assistance on behalf of borrowers, the former employees said.

    ‘Absurd’ Ecosystem

    Tens of thousands of HAMP modifications were improperly denied by Bank of America and Urban Lending since April 2009, according to a July complaint filed by homeowners against the two companies in federal court in Colorado.

    “Everyone knew that we weren’t helping people,” said Erik Schnackenberg, a customer-service manager who left Urban Lending in 2011 and now runs a yoga studio in Longmont, Colorado. “They were giving us all the pressure and none of the power to change anything. It was this absurd, self-contained ecosystem of worthlessness.”

    Schnackenberg and other former employees, who spent from four months to three years at Urban Lending as customer-service representatives and auditors, said they spoke when contacted by Bloomberg News because they’re distressed by what they saw.

    Seamless Experience

    Bank of America didn’t intend to mislead or stall customers or misrepresent facts to lawmakers, Ron Sturzenegger, head of the lender’s Legacy Assets Servicing unit, said in an hour-long interview. Changing HAMP guidelines and an initial influx of overdue borrowers made the program difficult to implement, and the bank has made improvements since 2009, he said.

    The only intent that we’ve ever had is to help these customers,” said Sturzenegger, 53. “If we could get more people into HAMP, we’d do more HAMPs.”

    Bank of America authorized Urban Lending to refer to itself as the Office of the CEO and President in letters and telephone conversations to provide a seamless experience for homeowners who complained directly to Moynihan, Sturzenegger said.

    The way we view Urban and other vendors like Urban is as an extension of Bank of America,” he said.

    Glenn Stevens, general counsel and executive vice president of human resources at Urban Lending, denied that the firm engaged in any wrongdoing and declined to respond to questions, saying he wouldn’t address matters tied to pending litigation.

    Contractor Army

    To do the HAMP modifications, the U.S. turned to mortgage servicers, which handle billing and foreclosures. Bank of America became the biggest servicer when Moynihan’s predecessor, Kenneth Lewis, arranged the purchase of Countrywide as it teetered under the weight of losses from subprime lending.

    The deal saddled Bank of America with at least $43 billion in costs, 1.4 million delinquent borrowers and mounting complaints about its performance.

    Moynihan called on outside vendors, who hired an army of employees peaking at almost 17,000 last year to deal with the failing loans. One was Pittsburgh-based Urban Lending, which had been doing title work for Bank of America since 2007. The vendor also serviced mortgages for MetLife Inc. and SunTrust Banks Inc.

    Urban Lending was founded in 2002 by Sanders, a 6-foot-1 graduate of Slippery Rock University who scored one touchdown over two seasons in the National Football League. Anticipating the coming housing apocalypse, Sanders, 49, pivoted from title searches to servicing troubled mortgages, according to an interview with the Pittsburgh Tribune-Review.

    Pittsburgh Restaurant

    Revenue at Urban Lending surged to $183.5 million last year from $8 million in 2007, making it one of the country’s fastest-growing minority-owned businesses, according to Black Enterprise magazine. Sanders, whose other holdings include the Pittsburgh restaurant Savoy and a stake in energy-drink maker Fever, declined to comment for this article.

    Urban Lending expanded in Colorado after winning the Bank of America contract, moving into a five-story brick building in Broomfield with views of the Rocky Mountains. The firm also had a warehouse in Broomfield for processing documents from tens of thousands of HAMP applications.

    There, unopened mail was stacked to the ceiling, said three people who spent time at the warehouse. Time-sensitive documents such as pay stubs grew stale, and paperwork was scanned into computer systems late or partially, triggering loan-modification rejections, the people said.

    ‘Black Hole’

    The warehouse was a “black hole,” according to a lawsuit filed in U.S. District Court in New York by former Urban Lending employee Gregory Mackler, who accused Bank of America of intentionally denying qualified HAMP applicants. The complaint was unsealed and dismissed last year after five lenders reached a $25 billion settlement with federal and state governments to end probes of abusive foreclosure practices.

    At the office in Broomfield, Urban Lending employees examined every letter from lawmakers to determine which were computer-generated and which were signed by a human, according to four former employees. The handwritten ones got special attention and were called wet signatures, they said. The others were referred to as dry.

    The signatures of some U.S. senators, including Democrats Harry Reid of Nevada, Carl Levin of Michigan and Charles Schumer of New York, were enlarged to two to three feet and tacked on the walls of a quality-control room to help employees identify wet signatures, the people said.

    Handwritten Signatures

    Complaints with handwritten signatures were sent to an outside law firm to reduce the risk that a regulator or lawmaker would fault the bank, according to the former employees. The rest were handled by regular staff.

    Sturzenegger denied that employees attempted to verify signatures. He said Urban Lending scrutinized all letters from politicians and regulators to help identify broader policy issues. Those that raised such matters were considered wet, he said, while those from homeowners were called dry.

    The most common tactic used to stall and reject homeowners was to claim they hadn’t submitted paperwork, according to all nine former employees. Urban Lending requested new applications and supporting documents including pay stubs every 30 to 60 days, even if the customer had sent them, the people said.

    “People went through years of sending documents in,” said Daniel Ellersdorfer, 37, a customer advocate who left Urban Lending after 13 months in September 2012 and is now a scuba-diving instructor. “There were people who did everything right and they would still get screwed over and have to start the modification process all over.”

    Palm Bay

    Sturzenegger said Urban Lending employees accusing the bank of wrongdoing have an incomplete understanding of customer files. Stevens, the contractor’s general counsel, said the allegations “are baseless and constitute nothing more than the unsubstantiated accusations of a few disgruntled ex-employees.”

    Santamaria and her husband Abdiel Echeverria, 35, bought their four-bedroom Palm Bay home in 2008 for $167,000 and spent $60,000 to renovate it, she said. They applied for HAMP in October 2009 after Echeverria’s hours as a Waste Management Inc. driver fell. The bank rejected the application because their mortgage costs were too low in relation to their income to qualify for the program.

    The couple applied again in January 2010, sending their application to an Urban Lending office in Pittsburgh, after their children, Jonathan and Rebecca, were diagnosed with autism, Santamaria said. After five months of sending HAMP paperwork with little to show for it, she complained to U.S. Representative Bill Posey, a Florida Republican, who contacted the Office of the Comptroller of the Currency on her behalf.

    OCC Letter

    Bank of America sent conflicting responses to the OCC and Santamaria. A Nov. 24, 2010, letter to Santamaria on Office of the CEO and President stationery stated that her modification was canceled because the bank didn’t receive the required financial paperwork. On the same day, the same customer advocate, Scott McDaniel, wrote to the OCC, saying the case was still under review.

    A third letter, sent by the OCC to Posey on Dec. 1 based on information obtained from Bank of America, said Santamaria had provided all documents and didn’t qualify for HAMP because her mortgage expenses were too low.

    “They tell the outsiders a completely different story from what’s really going on,” said Santamaria, who kept fax reports as evidence that she sent paperwork on time and has posted accounts of her dispute online.

    Santamaria said she was never told what was missing while sending applications and supporting material to Bank of America more than half a dozen times.

    Carlisle & Gallagher

    Her case shows how Bank of America relied on multiple contractors to staff its Office of the CEO and President. McDaniel, who signed the Nov. 24, 2010, letters, worked for Carlisle & Gallagher Consulting Group at the time. The firm was one of several vendors hired by Bank of America to handle mortgage complaints, said Dan Frahm, a spokesman for the bank.

    Melody Callaway, a spokeswoman for Charlotte-based Carlisle & Gallagher, declined to comment, as did McDaniel, who worked out of an office near Dallas and now owns an emergency-services company in West Plano, Texas.

    Santamaria’s case was returned for review to Urban Lending after she wrote to Posey and the OCC again, on Dec. 8, 2010, complaining that the bank’s letters contained inaccuracies. She said she received a phone call in January 2011 from a woman named Gloria Perez, offering her temporary forbearance on her mortgage -- the same offer the Dec. 1 letter from the OCC said she had already received.

    Perez was employed by Urban Lending, Frahm said.

    Emotional Harm

    Santamaria said she told Perez that she and her husband had filed a lawsuit the previous month in federal court in Orlando, Florida, accusing the bank of fraudulent misrepresentation and causing emotional harm. A judge dismissed the case, finding the couple, who represented themselves, failed to meet legal standards and provide sufficient evidence. An appeal was turned down in July.

    Last month, Bank of America sent her a foreclosure warning, Santamaria said.
    Posey declined through a spokesman to comment about the letters, as did Bryan Hubbard at the OCC. Frahm, the Bank of America spokesman, said the lender never received required documentation from Santamaria and ended efforts to reach her in mid-2011, after her lawsuit was filed.

    Extra Fees

    Borrowers whose modifications were delayed for a year or longer accumulated thousands of dollars in fees and interest and were disqualified for HAMP because their debt-to-income ratios worsened over time, four former Urban Lending employees said. Foreclosure or modifications under the bank’s own program, typically with higher interest rates, often became the only options, the people said.

    Bank of America said it had given 891,100 of its own modifications as of October, more than three times as many as provided under HAMP. That’s because most of the bank’s customers didn’t qualify for the government plan, Sturzenegger said.

    The bank gave legal assignments, title searches and appraisals to its own subsidiaries, including Recontrust and LandSafe. Fees charged to homeowners ranged from about $45 a month to inspect the outsides of homes to about $850 for legal filings, according to three former Urban Lending employees.

    Bank of America isn’t motivated by the extra fees and interest charged to customers as a result of delays, Sturzenegger said. The company doesn’t get reimbursed on all the fees, so it loses money when delinquencies drag on, he said.

    “Do you know how much money we lose in this division?” he said. “We lose a lot of money. To suggest we’re doing it because we make more money, it’s just completely inaccurate.”

    ‘Applying Pressure’

    Bank of America, which inherited hundreds of thousands of overdue borrowers from Countrywide, sent 33 percent of canceled HAMP trials into foreclosure through the end of July, the highest percentage of any of the biggest servicers, Treasury data show. The figure was 27 percent for Wells Fargo & Co. and 20 percent for both JPMorgan Chase & Co. and Citigroup Inc. The industry average was 22 percent.

    “While the country as a whole has made significant progress, there is still room for improvement for servicers, and the Treasury is committed to applying pressure on the mortgage-servicing industry to improve servicer behavior,” Treasury Deputy Assistant Secretary Tim Bowler said in an e-mail.

    The reality of working at Urban Lending contrasted with the training they received, six of the people said. Recruits were told during six-week introductory sessions that they were being paid $16 to $18 an hour to help Americans keep their homes.

    Taco Bell

    Once they started, employees learned that Bank of America quotas applied to everyone from customer advocates to auditors and quality-control staff, the people said. They worked 15-hour days and on weekends with the knowledge they could be fired if they couldn’t meet targets. Properly resolving complaints was often impossible because Urban Lending employees couldn’t access needed files among a dozen software programs and relied on Bank of America personnel who often ignored requests, they said.

    “Smart people would leave right away,” said Schnackenberg, the former Urban Lending manager. “You were left with people trying to take care of complex, aged files who were formerly assistant manager of a Taco Bell. It was a recipe for failure for homeowners.”

    Under pressure from bank managers to close cases, Urban Lending workers resorted to shortcuts, six people said. That included forging power-of-attorney letters or removing notations that a customer hired a lawyer, making it easier to close files.

    Managers purged complaints after business hours, circumventing an internal review process set up by Accenture Plc, according to two of the people. Employees falsified records to show late-night conversations with borrowers that didn’t happen, the people said.

    Sturzenegger said he didn’t believe Urban Lending employees falsified or tampered with records.

    The Hustle

    Bank of America used ex-Countrywide managers to push Urban Lending to meet its goals, according to the former employees. One of them was Mairone, the only individual named in the government’s first mortgage lawsuit from the financial crisis to reach trial.

    Mairone was part of the Countrywide team that set up a program known as the Hustle, which removed quality-control steps for mortgages sold to Fannie Mae and Freddie Mac, costing the U.S.-backed firms $863.6 million, according to a Nov. 8 filing by prosecutors in federal court in New York.

    She helped create Bank of America’s HAMP policies as the firm’s lead default-servicing executive, according to the July lawsuit. Mairone joined JPMorgan in 2012 and now oversees vendors for that bank, according to a New York Times article.

    ‘Wealthy Man’

    “If I had a nickel for every homeowner that e-mailed or called Rebecca to thank her for keeping them in their homes, working to save their families and helping them through tough times, I’d be an extremely wealthy man,” said Marc Mukasey, her lawyer, who declined to comment about Urban Lending.

    Another Countrywide executive who took a role at Bank of America managing Urban Lending was Ken Scheller, senior vice president of default servicing.

    Bank of America was “not of course interested” in good-faith reviews of HAMP applicants, Scheller told Mackler, according to the whistle-blower complaint filed by the former Urban Lending employee. Scheller, who’s no longer at Bank of America, and Mackler declined to comment.

    Urban Lending employees were told by trainers that they should never admit fault on the bank’s behalf in writing or over the phone, four former workers said. They were warned that e-mails could be subpoenaed, the people said.

    Gift Cards

    To soothe homeowners frustrated by delays, employees had a monthly allotment of $25 and $50 gift cards they could give customers, said three of the former workers. The joke among staff: It was just enough money to buy moving boxes.

    Urban Lending employees said they were told by their managers that the orders to reduce homeowners’ complaints came directly from Moynihan and Bank of America board members, who checked caseload figures daily. One such push was called the “Drive to Five,” a plan in late 2010 to lower complaints to 5,000 from more than 15,000.

    Sturzenegger, an investment banker who took over as head of the legacy-asset unit in August 2011, said it was his responsibility, not the CEO’s, to manage the division. Stevens, the Urban Lending lawyer, said the vendor “had no visibility as to the activities or agenda of Brian Moynihan or the BofA board of directors.”

    ‘Last Resort’

    Moynihan, 54, who declined to comment for this article, has spoken of the responsibility the bank has to its most vulnerable customers. He told an Atlanta Rotary Club prayer breakfast in October 2011 that foreclosing is “always the option of last resort,” according to prepared remarks.

    “Foreclosure is not only the worst outcome for a customer, it’s also the worst financial outcome for the servicer and the owner of the mortgage,” he said. “The best decisions are the ones that go beyond our own narrow self-interest.”

    The CEO, dogged by investors’ questions about mortgage costs since taking over in 2010, is dismantling the division that handles delinquent borrowers. The unit had 6,200 contractors as of June, down from its peak of 16,900 last year.

    While Bank of America survived the Countrywide acquisition, some of its customers didn’t fare as well. Foreclosure sales were scheduled as homeowners were waiting to hear about their applications, giving them little time to appeal mistakes, said six former Urban Lending employees.

    Christmas Foreclosure

    Jose De Santiago, a municipal inspector in Mission Viejo, California, was in the midst of a modification in December 2011 when he got the letter: He had five days to leave his two-bedroom condo.

    De Santiago, 43, spent Christmas packing his belongings with his son Joseph, then 13, and was out the next day.

    After a Bloomberg News reporter alerted the lender’s communications department, Bank of America bought the condo from Alton Holdings Inc., which had purchased it in a foreclosure auction. A bank lawyer apologized, and De Santiago was allowed to move back after two weeks.

    Bank of America offered $5,000 to compensate him for furniture lost in the eviction, according to a draft of a proposed settlement. De Santiago refused because he would have had to sign a liability release, he said. He’s still fighting the lender to get it to repair his credit scores.

    “They asked me to put in writing how well they treated me,” De Santiago said. “I can’t believe Bank of America was allowed to do the horrible things it did to me and others.”

    Bank of America’s Sturzenegger said some customers who should have received government assistance may have fallen through the cracks of the system the lender created.

    “If you went back and re-reviewed the documents, based on today, would they have qualified for HAMP?” Sturzenegger said. “Possibly. That’s the best way to answer it.”

    To contact the reporter on this story: Hugh Son in New York at

    Bank of America: Sorry About The Foreclosure. Here, Have An Applebee’s Gift Card On Us.

    by Bess Levin | December 16, 2013

    Buy yourself something nice. Like some drinks and a couple apps. Bank of America, led by Chief Executive Officer Brian T. Moynihan, faced more than 15,000 complaints in 2010 from its role in the government’s Home Affordable Modification Program. Urban Lending, one of the vendors brought in to handle grievances from lawmakers and regulators on behalf of borrowers, also operated a mail-processing center for HAMP documents.

    Instead of helping homeowners as promised under agreements with the U.S. Treasury Department, Bank of America stalled them with repeated requests for paperwork and incorrect income calculations, according to nine former Urban Lending employees. Some borrowers were sent into foreclosure or pricier loan modifications padded with fees resulting from the delays, according to the people, all but two of whom asked to remain anonymous because they signed confidentiality agreements . . . To soothe homeowners frustrated by delays, employees had a monthly allotment of $25 and $50 gift cards they could give customers, said three of the former workers.

    More Christmasy news?

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    Happy Christmas!

    One more Sarah Palin story to properly end this most metaphorical of years:

    You can be fired for calling your boss a dick, and you can just as easily be let go by a profit-seeking media company for imperiling its relationship with advertisers. And incidentally, this is the way true conservatives, and especially true hardcore speech advocates, have always wanted it.

    Could you imagine the uproar if someone passed a law saying that Martin Bashir couldn't be bounced from a broadcast job for saying Sarah Palin was a good candidate to have feces shoved in her mouth? Now that would be censorship.

    Remember, nobody heard a peep from Sarah Palin about free speech after that episode. Bashir earlier this year tiptoed across the line in an angry diatribe about Palin's invocation of slavery imagery, which she had somewhat amazingly used to describe the suffering (presumably white) middle Americans will feel when they are forced to pay for the "free stuff" the Obama administration is handing out, i.e. health care . . . .

    Palin's mind is amazing. Slavery was purely a private-enterprise abomination. It had nothing to do with being subservient to the government. It was the opposite of that, actually. She was also wrong in the sense that the health care program isn't "free stuff" (even those who will receive subsidized care will be paying in one form or another for their policies).

    So she pulled off a Friedman-esque anatomical impossibility there, getting three feet in her mouth at the same time.

    First, she was wrong about slavery. Then she was wrong about health care. Then, thirdly, she was almost insanely insensitive and inappropriate in her use of the word slavery at all, comparing white middle class angst over having to partially subsidize health care for their poor (and mostly nonwhite) neighbors to being whipped and tortured across generations of institutional racist terror.

    Bashir reacted to this by telling a story about slaves who were forced to defecate in each others' mouths, and then suggested that Palin, having "scraped the barrel of her long-deceased mind," was a "good candidate" for the same treatment. Soon after, he was essentially forced out of the network.

    Happy Holidays, amigos and amigas.

    If you would like to help spread the caliber of information available here at Pottersville2 throughout the netopia, please make a contribution to this blog's continuation in the new year by clicking on the PayPal donation button at the top of this page (or email me for other available routes of contribution).

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