Are all assignments fraud

It would be good to get some other heads on this, if an original creditor has assigned the choose in action to a trust unit for an investor (securitisation), that would make them a third party or agent, how do they have the authority to re-assign the debt!!! Is this an avenue or a dead end!





To create a legal assignment there must be a written document signed by the assignor. Signature by an agent would not appear to be sufficient. Any form of wording may be used provided there is a clear intention to make an absolute assignment. The assignment may be a document passing between the assignor and the assignee, or a written demand from the assignor to the debtor that the debtor pays or discharges his obligations to the assignee. In the latter case, in order to be an effective assignment rather than merely an authority to pay a third party, there must be evidence that the assignee consented to the arrangement between the assignor and the debtor (see Curran v Newpark Cinemas Ltd). Unlike an assignment, an authority to pay can be revoked prior to the actual payment.

thats useful ok how, ie in contract law? or ?

Originally the agreement that creates a debt is contract law, however, its actually an agreement to create a trust providing the property is transferred, the trust will then be treated as perfect. That would be between the OC and debtor.

What then happens is the OC sells the receivables to an SPV, in the UK the SPV is almost always a trust unit. This is the assignment of the futures from the original agreement to an investor, in fact that is the only real benefit deriving from the agreement. The benefit or rights to the debt is already assigned to a trust unit through the securitisation process, then assigned again to an investor, the bank are merely acting as a collections agency, third party, the right to the debt has been assigned...... how are they assigning it on default/non payment when they are just an agent/third party.

Im not sure what this would come under, most likely equity, however, there should be something in contract law, legislation, governing this, one would think......

The contract is with the OC and nobody else, no contract or its contained contractual conditions can be transferred WITHOUT all the parties consent, so yes they are putting something which is a contract into something else without consent of ALL the parties.

Its your basic fraud.

So might a question, in addition to other questions we ask of the DCs, go something like this.

I require you to provide me with a sworn affidavit verifying any alleged debt you claim I owe you; has not been securitised and which guarantees all other third parties, human or otherwise, have no actionable claim of right to the debt or Chose in Action.

By putting this in the negative it puts the burden of proof on the DC to provide documentary evidence they have exclusive title to the debt or chose in action. I suspect the down side of this is that we may be pushing ourselves into a corner on the basis that we are implying we will pay the debt if they so deliver.

The best thing from this question though is that we can disagree and argue their affidavit is false because of the securitisation, as assassin has described. It buys time, it frustrates them, delays them and puts them to more cost.

Further, perhaps we could demand a guarantee of exclusivity of ownership on their part as a form of indemnity to us but how might me we do. Otherwise, perhaps we could also demand they indemnify us against any third party taking an action against us either before, during or after a trail or after finalisation of the case, at some point in the future.

Hey assassin and ausk

There are a couple of points to work with in the securitisation process, I think ALAB has posted some good info on the subject.

1. They are processing and transferring our personal data without our knowledge or consent or any contract to do so (although there may be some subtle terms they use to worm their way around it).

2. They are profiting of our estates without giving us a cut

3. If they have assigned the full estate, Title, rights and interests to a trust unit and/or investor, what relationship do we have with the OC.

4. As Ausk says simply by asking them if its been securitised puts them on the back foot, I don't think we would need to use conditional acceptance on proof, we have a right to know, one would think. We could be asking them to prove they are still the title holders and that it hasn't been assigned, as we would if we asked for the deed of assignment. Please provide documents of title or any assignments of the assets, are we then quietly asking if the choose in action has been securitised???

For a mortgage for example after the assets have been securitised the bank are functioning as trustee, they have a responsibility to foreclose on the debtor on behalf of the investor and they do not even have to mention the investors involvement.

For an unsecured loan for example, the receivables have been securitised, what is then the OC's relationship with us, because if they have assigned the full estate already how can they assign it again, unless its transferred back on default???

If they are not the true title holders then they have nothing to assign, its fraud!

So long as s126 of the law of property, power of attorney clause, isn't involved all should be good.

Follow the money comes to mind

In common law tracing you cannot trace specific subject matter into mixed assets, however, in equity you can trace the specific subject matter into mixed assets. If you got an equitable tracing order you could trace the money, that would reveal everything. Ask if its been securitised, ask them to prove they are still in possession of the estate, if they do not thats a refusal, make an equitable claim for a tracing order........

I guys ,
These are exactly the lines i think we should be looking at .
For quite some time the subject of securitisation has been talked about, From what I see no one has simply asked them the question.
I think this is a subject they will want to avoid at all costs ,& why we must insist that all correspondence is signed by someone who takes liability.

I have and am. They are saying they are not obliged to give me that information. If they haven't felt with my complaint within the next two weeks I go back to the ICO. At the moment I'm using the Data Protection act. IF they continue to refuse, then I will go in under a notice of disclosure as the beneficiary , after that I would have done everything I can to settle the matter out of court so I shall seek equitable assistance from the court.....

Thats the game plan anyways.

Hey,

The tracing probably wont work due to the way they audit and, when an SPV collapses then there is little recourse through liquidation proceedings as they are setting their own statute bar dates for this type of litigation, e.g. you could have brought certain litigation whilst the SPV still had liquidity. (very brief, oversimplified statement, there is a lot of context that needs to be understood as it is not a simple a, b, c process).

However, I feel the approach is wrong. We are waiting for the SPV to collapse and then do something about it, why?.

Taking a risk averse approach would be the shield. The note is our property they, can only securitise it (in some fashion) with our permission, the way they obtain that permission could be direct 'Hey Mr Smith, we want to securitise you note' or it could be via other means such as implied by satisfaction of service, a notice or other, if you ignore the notice or other then after thirty days they can take it as agreement. (again, over simplified statement, there is a lot more context to this).

I feel we need to,

1, ensure any general powers of attorney out there need to be cleared up and not left ambiguous for someone to come along (government/private corporation) and take responsibility for our lack of responsibility to get our affairs in order.

2, Declare to the bank that we have the 'beneficial interest' in the note. This is not making any accusations, auditing request, spv request etc etc. Purely just making a simple statement that we have the 'beneficial interest' in our property. This will achieve a number of things. Firstly if they try to securitise the note in the future then they have to seek our permission as the beneficial interest in the property. Secondly if they have already securitised the note then they would have to advise us of this as they would be acting in bad faith. If they have securitised the note then so what, simply request for a reversal of that transaction.

Waffle wrote:

1. They are processing and transferring our personal data without our knowledge or consent or any contract to do so (although there may be some subtle terms they use to worm their way around it).

alab := They are not. The information in the SPV is encrypted for this very reason. If there were any egregious terms like this in the contract they would have to take the 'red ink red hand' approach.

2. They are profiting of our estates without giving us a cut

alab := Personally, I don't care, all I care about is ensuring that when I pay my mortgage it is settled. Maybe there is a recourse to follow here but, to me it is a cost/time/benefit analysis and, they are the ones writing the rules.

3. If they have assigned the full estate, Title, rights and interests to a trust unit and/or investor, what relationship do we have with the OC.

alab := none, that's why, if a person is in foreclosure then they can use this as the initial defence to dispute jurisdiction, I posted a case that used this successfully awhile ago.

4. As Ausk says simply by asking them if its been securitised puts them on the back foot, I don't think we would need to use conditional acceptance on proof, we have a right to know, one would think. We could be asking them to prove they are still the title holders and that it hasn't been assigned, as we would if we asked for the deed of assignment. Please provide documents of title or any assignments of the assets, are we then quietly asking if the choose in action has been securitised???

alab := why waste your ink on asking the question, force the answer by declaring your beneficial interest.

Again very over simplified so, anyone reading it and thinking its the magic bullet it is not. I have tried to condense about fifty thousand pages of documents in to a couple of sentences so, please take it for what it is, a couple of pointers and not advice.

How are the receivables usually transferred from the originator to the SPV (for example, assignment, novation, sub-participation, declaration of trust)?

How is the transfer perfected? Are there any rules, requirements or exemptions that apply speci cally to transferring receivables in a securitisation transaction?


Most classes of account receivables are usually transferred by assignment, which operates as a “true sale” transfer

For perfection, English law makes a distinction between legal and equitable assignments. To take effect at law:
> The assignment must be absolute and not purport to be by way of charge only.

> The assignment must be in writing signed by the assignor.

> Express notice of the assignment (in writing) must be given to the debtor.

An assignment which does not comply with these conditions takes effect as an equitable assignment.

Other transfer methods include novation and declaration of trust.

There are no rules, requirements or exemptions that apply speci cally to transferring receivables in a securitisation transaction as opposed to any other type of receivables sale.



There it is the receivables are already assigned in the securitisation process so how the frack does the 'originator' have the ability to assign a debt when the estate has already been assigned to an SPV??????




The processing of information about living individuals is regulated by the Data Protection Act 1998. A buyer of receivables under which individuals are debtors is therefore likely to be a data controller within the meaning of the Data Protection Act, which means it must comply with the provisions of the Data Protection Act relating to the processing and keeping of information on the individuals.

https://www.slaughterandmay.com/media/1429124/securitisation_-_uk_england_and_wales.pdf

Im pretty sure it was slaughter and may that were recently involved in the reformation of Newday by creating Newday cards as a securitisation outfit for them to help them manage their billions of £££ of debt....

What you need to do is look at a sale agreement, specifically clauses regarding who retains the title / interest.

Also, there's usually a clause in that won't transfer any account which is in arrears at any point at least 12 months prior to the agreement being reached.

Link to a sales agreement for mortgages.

http://www.ybs.co.uk/your-society/treasury/documents/transaction-documents/Mortgage-Sale_Agreem.PDF

All on securitisation again!

Authorisation under consumer credit legislation is obtained from the FCA. An originator will need authorisation to conduct certain credit- regulated activities such as debt collection. Further, credit agreements must comply with certain origination requirements in relation to both pre- contractual dealings and the origination documentation. If those require- ments are not complied with, then the credit agreement is unenforceable against the customer. The issuer is also likely to require authorisation if it is purchasing consumer credit loans, pursuant to the Consumer Credit Act 1974 (as amended).

Additionally, the originator and the issuer will need to consider whether registration under the Data Protection Act 1998 (DPA) is required (see question 20).

Question 20

What confidentiality and data protection measures are required to protect obligors in a securitisation? Is waiver of confidentiality possible?

The processing of information about living individuals is regulated by the DPA. The DPA only applies to personal data and therefore does not cover information about corporations. A data controller is any legal person who determines the purposes for which, and the manner in which any personal data is to be processed. An SPV acquiring receivables which nevertheless continue to be serviced by the seller is likely to be a data controller, and will therefore require registration under the DPA (as will the seller). Any data controller must complete an annual noti cation process before processing any data.

Data controllers must comply with a set of principles that restrict the processing and keeping of personal data, the most basic of which is that the processing of data must be fair and lawful. Further, data must not be trans- ferred outside of the EEA unless adequate protection is in place.

There is also a limited right for individuals to prevent publication of con dential information about themselves. As a matter of contract, parties are free to waive con dentiality. It is customary, in the case of mortgage- backed securitisations for example, for mortgagors to consent in their mortgage terms and conditions to the disclosure of certain information about the mortgage.




18 Must obligors be informed of the securitisation? How is notification effected?
Receivables may be assigned to the SPV without noti cation to the obli- gors. This amounts to an equitable assignment, which is commonly used in securitisations in this jurisdiction. However, the absence of notice has the following consequences:

[Exclusivelyfor:DechertLLP|15-Jul-15,06:44PM] GettingTheDealThrough
obligors may continue to discharge their debts by making payments to the seller (being the lender of record);

obligors may set o  claims against the seller arising prior to receipt by the obligors of the notice of assignment;

a subsequent assignee of a receivable without notice of the prior assignment by the seller would take priority over the claims of the ini- tial purchaser;

the seller may amend the agreement governing the terms of the receivable without the purchaser’s consent; and

the purchaser cannot sue the obligor in its own name (although this is rarely an impediment in practice).

To perfect an assignment of receivables, express notice in writing is required to be given to the obligor. The assignment will only become a legal assignment when notice is given and the formalities required under sec- tion 136 of the

Law of Property Act 1925 (LPA) are met. Pursuant to section 136 of the LPA, the assignment must be:

• in writing and signed by the assignor;
• of the whole of the debt; and
• absolute and unconditional and not by way of charge.



To assign the receivables they have to follow s136 and assign the WHOLE debt, thats full rights title and interests ALL the estate, so how in the hell are the 'originators' assigning it again when someone has missed payments, do they even have the estate to do this or is it fraud!!!!

Hey Tiggy

This is from the document you provided.

the Seller hereby agrees to sell to the Issuer with full title guarantee or, in the case of the Scottish Loans and their Related Security comprised in the Portfolio, with absolute warrandice to the Issuer, all its right, title, interest........



They are assigning the estate, how in the hell is the estate then being assigned under the hand of the OC when they don't even have the rights title or interest!!!

This is for all credit cards, personal loans, mortgages, insurance, mobile phone contracts, utility contracts....

About the only thing that isn't securitised are social security benefits, thats the only one I've seen they can't and don't securitise, how in the hell are these parasites assigning an estate when they don't even have one to assign!!

The issuer being the SPV......

Scotland deals with property in different ways to the rest of the Uk. Look at section 6.2, you also need to refer to case law on securitisation. Paragon Finance Plc vs Pender & Anor (I think) is the leading case.

according to 6.2 the 'seller' is the trustee in this case retaining legal title, but is this the case for all and is this the case in England and is this only for asset backed securities like mortgages.....

In the references above it says for an assignment to take place it must comply with s136 LoP, that means absolute the full legal estate, would it be out of the question that my initial assumptions are taking place but perhaps not in all cases, or are they simply using the equitable assignment if so what can we toy with in regards to that.

Hi guys

So is the bank/lone-a-ranger really the 3rd party (P3) in all securitised loan arrangements? i do believe so.... he could also be playing the roles of beneficiary or Executor.or both - but never the Trustee (unsurprisingly).

WARNING! - I'm about to ramble.

Imo there are several different deals/contracts going on within the loan agreement, involving both common-law and commercial and any number of interested parties but a minimum of 4.

man = 1st Party, P1
Mr Hugh Man = 2nd Party, P2
Bank = 3rd Party, P3
Investor = 4th Party, P4

P1 approaches P3 and asks for £10K on the promise that P1 will repay it to a fixed term at regular intervals.

P3 says "ok, i'll TRUST you" but has P1 sign a Promissory Note in the NAME of P2.

P1, although he doesn't know it, has 'personal funding' in the form of an ESTATE, to which he is beneficiary, created by ???? to indemnify him in the event of commercial calamity, in the form of a probated CQV trust and represented by his 'person' aka Mr Hugh Man. P1 doesn't know this - but P3 does......

P3 liens the P1/P2 ESTATE and deposits the (now guaranteed/secured) PN into a conveniently ready-to-go SPV which is sold as receivables to P4.

P3 takes his 'cut' from the P4 fee and then credits the £10K to P2, which funds P1.

Now P3 has not used client deposits to fund this, nor has it risked it's own money. All it has done is facilitate credit to P2 and promised profit of receivables to P4 - with no risk of liability, nor any consideration offered. P3 did this by creating two trusts, one overlaying the other yet interlinked, one common-law one commercial - diabolically clever!

What do you think so far?

Cheers!

Waffle wrote:I have and am. They are saying they are not obliged to give me that information. If they haven't felt with my complaint within the next two weeks I go back to the ICO. At the moment I'm using the Data Protection act. IF they continue to refuse, then I will go in under a notice of disclosure as the beneficiary , after that I would have done everything I can to settle the matter out of court so I shall seek equitable assistance from the court.....

Thats the game plan anyways.

well; we reqire that information as part of their documentry evidence of their proof they can give us good discharge of the debt.

I definately see the issue of the scuritiisation of the debt as being closely linked to their capacity to deliver us good discharge of the debt. I reckon we're on a winner here.

There are two possibilities, equitable assignment or legal assignment, if there has been a legal assignment without notice for a securitisation process (I don't for one second believe they are following the rules all the time) then they are pursuing something without the rights to do so or the ability to give good discharge.

If it has been assigned equitably is it the beneficiary who instigates the claim adjoining the legal title holder or does the title holder have the power to do that on its own behalf without the consent of the equitable assignee??

And could the assignment have taken place legally but gone to an SPV without notice to the debtor, then the SPV dishes out the equitable assignment depending on the originator to enforce the terms of the contract as they are the only ones party to the agreement.......

Interesting case

(Bexhill (UK) Ltd v Razzaq [2012] EWCA Civ 1376).

The judgment indicated that in the case of at least an equitable assignment, the assignee might, with a suitably express formula and so long as it did not contradict the terms of the assignment, be able to authorise the assignor to sue in his own name. Whether this is permissible in the wider commercial context is not addressed in the judgment.

Is this an indication that for a claim to take place it has to be instigated by the equitable assignee. Its clear the claim would usually be brought in the name of the legal owner, but an equitable assignee may also in certain circumstances invoke the legal owner/assignor to bring a claim in the assignee's name.

In practice, though, and particularly in the case of a securitised loan (see below) the assignment is often equitable (e.g. because notice of it has not been given to the borrower, or because it is effected by way of an uncompleted agreement to assign). In that case Bank B is entitled to sue, but as a matter of procedure, judgment should not normally be given unless Bank A has been joined to the action so as to be bound by the result. This is to avoid “double jeopardy” for the defendant. An action brought by Bank B alone, however, is not a nullity, and can be cured at any time by the appropriate application for joinder. Bank A is entitled to sue only as a trustee for Bank B.2 Since assignor and assignee have the same cause of action, the fact that a limitation period has expired should not prevent Bank A from being subsequently joined to the proceedings even after the expiry of limitation.

The Court of Appeal case of Bexhill UK Ltd v. Razzaq [2012] EWCA Civ 1376 also suggests that it is risky for an equitable assignor to bring a claim without joining the equitable assignee. In that case it was held that the assignor’s possession claim failed because it had not joined theassignee (although the earlier Court of Appeal case of Paragon v. Pender [2005] EWCA Civ 760; [2005] 1 W.L.R. 3412 which concluded that an equitable assignor could sue for possession without joining the assignee was not apparently cited).

A feature of the case was that it was in fact the Originator (Paratus, though at the relevant time GMAC), that had suffered the eventual loss – albeit in its capacity as junior tranche investor (it was entitled to the residue of payments after all the notes were paid). Having exonerated the valuers of breach of duty, the judge dealt with Countrywide's securitisation arguments relatively briefly, at [59]-[62]. He agreed with the submission that there had been no loss, per Nykredit, at the date of the assignment. However:
1. The assigment from GMAC, in its capacity as Originator, to its SPV, RMAC, was equitable only. GMAC as Originator held the right to sue on trust for RMAC;
2. The person entitled to the benefit of the mortgage pool had received less value than it ought to have received, so a real loss had been suffered;
3. Larkstore showed that the courts were anxious that a contract-breaker should not avoid liability for the consequences of his breach of contract.




Who can bring a claim when a choose in action has been assigned?

Firstly we should consider the type of assignment.

Legal assignment: This transfers all title rights and interests to the assignee, it is only the assignee who can claim against the debtor, in this case the assignee can only claim the worth that the loss of the OC wold have suffered.

Equitable assignment: In this case it is the benefit of the agreement that has been assigned the OC retains the legal title, the right to sue. For a claim to be made the equitable assignee must join the assignors name to the claim, the assignee may bring a claim in its own name subject to specific conditions but must still adjoin the assignor.

The assignor may make a claim against the debtor without joining the assignee, however, the assignor can only do so as trustee........