November 02, 2007

Oh, gee, what a shock: New York suing major appraisal unit and Washington Mutual for illegally colluding to overinflate appraisals



Next we'll find out that realtors lied to homedebtors, or that mortgage brokers falsified paperwork, or that the NAR sexxed up its press releases, or that Angelo Mozilo had insider information before he dumped CFC, or that Iraq didn't have any WMD, or that the Easter Bunny doesn't exist...

Folks, we don' t have enough jail cells or courts to prosecute all of the REIC fraud and crime that took place these past few years. Maybe we need a "REIC and Homedebtor Amnesty" program, where they admit their crimes, pay fines, do community service, and move on. Otherwise we'll go bankrupt jailing the scum.

Cuomo: Appraisers Inflated Home Values


ALBANY, N.Y. (AP) — New York Attorney General Andrew Cuomo said Thursday a major real estate appraisal company colluded with the nation's largest savings and loan companies to inflate the values of homes nationwide, contributing to the subprime mortgage crisis.

"This is a case we believe is indicative of an industrywide problem," Cuomo said in a news conference.

Cuomo announced the civil lawsuit against eAppraiseIT that accuses the First American Corp. subsidiary of caving in to pressure from Washington Mutual Inc. to use a list of "proven appraisers" who he claims inflated home appraisals.

16 comments:

nfn.nln said...

Canadian Dollar is at 1.0683 vs. the US. I'm use to 0.75, so this is amazing. When will it be time to buy back into the US dollar??? This can't continue forever can it?

Mammoth said...

.
.
.
As the 6:30 a.m. ferry was coming into downtown Seattle on the morning of Oct. 31st, we all saw that WaMu’s headquarters building’s lights were out, except for windows lit to form a picture of a Jack-o-Lantern on the side of the building.

I noticed that one of the triangular-shaped eyes appeared dimmer than the other. Apparently, WaMu does indeed have a black eye.
-Mammoth

Anonymous said...

I found this on another Blog from a WaMu employee



Here's a comment from the HYPERLINK
"http://blogs.wsj.com/developments/2007/11/01/the-trouble-with-apprais
als/?mod=homeblogmod_developments"WSJ Blog:

As a current employee in the mortgage banking dept. at WAMU (not in
NY) I have more than first hand knowledge of the outfit (e-appraise
it) getting sued. WAMU scrapped their in house appraisal dept. this
year and farms out every appraisal nationwide to two vendors. The one
getting sued is by far the most incompetent, frustrating, inefficient
operation any of us as ever experienced from an appraisal entity in
over 20 years.

One thing I know for sure is that you can in no way, shape or form
influence the value of the appraisal from either of these entities.
First, it is randomly chose which one gets the business, and second,
you are in no way allowed to even speak to the appraiser or give them
a value needed for the particular loan being made.

The complaint was always the other way around: they consistently
butchered their appraisal reports because essentially it is a chop
shop just churning out volume with little interest in the quality of
their work. Trying to forward documents or information to them was to
send it into a black hole; turn times were horrible, and mistakes were
common.

I don't believe these allegations can be considered widespread (maybe
a few were able to game the system, but ALL the employees I work with
wanted us to dump this outfit for incompetence, not fraud). Either
way, everyone in my office cheered this news because this company is
an impediment to quality business, not an enabler.

Comment by WAMU employee - November 1, 2007 at HYPERLINK
" http://blogs.wsj.com/developments/2007/11/01/the-trouble-with-apprais
als/?mod=homeblogmod_developments#comment-1063#comment-1063"6:13 pm

king of the Bitter Renters said...

My sweet little neighbor, who happens to be a VP at a local bank here in Seattle, blatantly committed fraud by gettting an "aggressive" appraiser to call her 900sf 2+1 (that was really worth 350k,) $600,000 !!!!!!

Here in Seattle, it is different. ( We are the longest tributary to river DeNial on the map)

She is so sweet, but she should go to jail.

Anonymous said...

"Over-inflated appraisals." That really says it all.

On the other hand, the blind queue systems that WaMu and CFC put in place probably tracks to their originating income performance. No sooner did AMC agree to use blind queues than it decided to fold up its retail.

Anonymous said...

as an appraiser, the Wa Mu employee is full of CRAP...

eappraiseit and LSI are nothing more then bottom feaders that pay the local appraiser 175-195 and then charge the consumer 350-400 all of which they pocket....its a profit center for them and a way to tell the regulators that they are not trying to bent the appraisers armmm,,,right...scumbags

Please go to the Atty Gen of NY web site and see the actual e-mails from Wa Mu to this scum bag company...

Oh and LSI is no better ..


Its funny that many of the big boys in trouble use these and other so called management companies some of which are owned by the bank,,they are nothing more then a profit center..

Wells Fargo and Rels

Country Slime and Landsafe...

All of these outfits pray on the inexperienced appraiser and they shun competent and well qualified appraisers,,,

I really think and from what I am hearing is that the NY AG is going to flip eappraisit and have them go after Wa Mu and Country Slime...along with other big lenders and I can't wait to see it happen...

Anonymous said...

As I've said repeatedly, WaMu is a $2 stock waiting to happen...

LauraVella said...

Everyone is just starting to wake from this drug induced stupor...

Anyone assume WAMU is safe? Think again.

The holidays are going to be interesting.

Anonymous said...

He (Cuomo) first went after the student loan companies and universities (a few months ago) and was successful in getting some large settlements paid - same racket but different victims. The financial aid officers of schools would steer students into loans with lenders who were paying the officers a kickback for business. Sallie Mae had to pony up over a million in fines. I say "Go get 'em Tiger" and put their g*d damned feet to the fire.

Smug Bastard

serindippity said...

Now what maroons at WaMoooo thought of this scheme?

Didn't they get a clue, that *lenders* are the *victims* of inflated appraisal?

"Oh looky here, let's artificially inflate measured home values so that we really have a bunch less collateral than we think we have! This way we can have better ratios and we can go lending more and more!"

"moo!"
"moo!"
"moooo!
"moooooooO!"

some recent MIT grad: "uh, guys isn't there a problem with that..."

overpaid executive: "Please son, you nerds just don't understand how real business works. Understanding these details is why I'm paid well, and you aren't. And this brilliant plan will help us make our quarterly bonuses. If you want to keep working here, learn how to mooooooo!"

"OK. moo."

Anonymous said...

A while ago, I posted here saying how I thought that this site had gone easy on appraisers. I felt that surely appraisers would receive some major criticism, but usually they were written about as "also rans" in the criticism arena.

Anyway, I do believe that this site has given decent criticism to them, but with so much corruption in the Real Estate market, they just simply couldn't grab the headlines.

Anyway, I feel these scumbags are a major reason for these bloated prices for homes.

They need to roast.

Off topic, but I noticed a high powered real estate agent to the stars got bumped off. Bludgeoned really. I have a feeling someone lost lots of money and took it into their own hands to pay back said person.

There will be lots more appraisers being thrown in the slammer, but if they are lucky, they won't end up six feet under ground.

Let's see, what might get someone killed? This is easy. Ripping off people (dumb ones to be sure) of tens of thousands of dollars (or millions) where the promises of riches and investment earnings turn into foreclosures and broken dreams and homeless families.

Anonymous said...

My biggest problem with WAMU is their huge portfoilo of Option ARM mortgages and how they book income.

According to GAAP rules, they book 'income' on the normal payment of the loan, even though a mortage borrower may choose the 'option' of paying less. Seems most people choose the 'option' of paying less.

This means that much of WAMU's 'profits' are paper... and are directly tied to the underlying value of the houses for which they own mortgages.

http://www.thestreet.com/s/is-wamu-the-next-countrywide/newsanalysis/ratings/10375529.html?puc=_tscs

WAMU is a ticking time bomb! I sold my shares of it in June, and wouldn't consider holding any non-FDIC insured debt.

Anonymous said...

From Bloomberg:

SEC Inquiry

The Securities and Exchange Commission is looking into how Citigroup accounted for certain transactions in a banking- industry rescue plan, the Journal reported, citing people familiar with the matter. Specifically, it's reviewing whether the company properly accounted for $80 billion in structured investment vehicles, the newspaper said, citing one of those people.

The result of the review, still in early stages, could include no action or a referral to the SEC's enforcement division, the Journal said.

Big Daddy said...

I am an appraiser that mainly does attorney divorce litigation work..

Many of the problems stem from the lender pressuring not only appraisers but under writers as well...

As far as Wamoo goes and other banks for that matter,,,

These people (employees) make there money off of CLOSING LOANS,,and they do not have to give the money back in 6 months when the deal goes south...

I agree that the low barrier to entry to be a state certified appraiser is so low,,the greeter at Walmart has probably taken the 90 hours class..and has an appraiser card,, in Fact, they probable have better training...


As a defence of the average honest appraiser, many times the house value was there however, the lender loaned some one 400,000 when they make 40k a year..HELLO...

ALSO, remember, the appraiser does NOT work for the buyer or the seller in the transaction but the lender and is but one piece of the puzzle along with other supporting documents...

I hope they make it a felony to pressure an appraiser and then you may see progress but till then, the lenders determine the rules, find and use number hitters and force honest appraisers out of business...Also get ready for a BIG tax payer bailout..after all, a couple of million in campaign cash will make that happen...

LauraVella said...

By the time this investingation is through, WAMU will be mooing like slaughtered beef...

Maybe that's the reason behind the recent name change...

Anonymous said...

First an overexuberance in the tech market, then real estate. Whats next? Ah the gold mongers are back.....oh and who is making money off of that?

A fool is born every second.