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Mortgage

WFC can’t keep alleged bogus foreclosure manual out of court

U.S. judge allows discovery on Tirelli's smoking gun

A New York judge ruled that Wells Fargo (WFC) can’t keep its Home Mortgage Foreclosure Attorney Procedure Manual out of a lawsuit in federal court.  

U.S. Judge Allan Gropper agreed to allow the 150-page manual – a copy of which was obtained by plaintiff’s attorney – into a lawsuit being brought on behalf of a homeowner by attorney Linda Tirelli against Wells Fargo, the largest mortgage servicer in the United States.

The case is an objection to foreclosure claims in bankruptcy in Mota v. Wells Fargo.

Tirelli’s case alleges that Wells Fargo used the Wells Fargo manual – the copy she entered into evidence was dated February 24, 2012 – to falsely create evidence of ownership, known as the note, and on how to proceed with a foreclosure when crucial documents are missing.

Wells Fargo counters that Tirelli is misrepresenting the manual in several ways. Its foreclosures are legal and customer-focused, Wells said in a statement to HousingWire.

The manual is attorney Tirelli’s “smoking gun” in a lawsuit she filed on behalf of a homeowner.

“(Wells Fargo) can no longer deny having procedures for endorsing notes or provide witnesses who lack knowledge about the procedures, which is what they have consistently done in the past,” Tirelli told HousingWire on Monday. “The procedure manual is raising a lot of eyebrows and rightfully so. I attended the National Association of Consumer Bankruptcy Attorneys convention April 11-13 … during which I spoke with many consumer attorneys from across the country who have run into the same problem of witnesses being provided by Wells Fargo who simply lack knowledge of the process or deny there is a process for obtaining endorsements on notes and creating assignments or affidavits of lost note.”

As part of the judge’s ruling, Wells Fargo must also provide Tirelli a witness to answer questions about the guidebook in a deposition.

Separately, Tirelli is filing a motion to re-open discovery post-trial in a separate bankruptcy case — Cynthia Franklin vs. Wells Fargo — as that went to trial days before Tirelli discovered the Wells Fargo manual.

Such endoresements as described in the Wells Fargo manual are required to prove a servicer owns a loan and has the legal standing and right to foreclose and borrowers have used “show me the note” as a defense to fight foreclosure.

The Wells Fargo manual – a copy of which can be downloaded or viewed here – provides step-by-step guides for Wells Fargo foreclosure attorneys and the “Default Docs Team.”

“(T)here seems to be a consensus that this manual sets forth the procedures in simple step by step fashion where magically all steps lead to corrected paperwork and, in my opinion, fabrication of documents which simply never existed until a lawyer points it out to Wells Fargo that documents are lacking,” she said.  “If Wells Fargo is in fact fabricating documents and involves the foreclosure attorneys in the process, the ramifications on the attorneys involved can be severe and in my opinion, if its in furtherance of fraud, non of the communications would be subject to attorney/client privilege.” 

Discovery and depositions are up next in the cases.

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