Judge Allows South Florida Homeowner to Sue Investors In Lawsuit Charging Financial Institutions With Mortgage Appraisal and Origination Fraud

Wells Fargo, Greenpoint Mortgage Funding, and Credit Suisse First Boston Mortgage Securities Corp. adjustable rate mortgage trust named as defendants.

MIAMI, FL, October 04, 2011 /24-7PressRelease/ -- A Miami-Dade Circuit Court Judge has granted Coral Gables, Fla. homeowner Pelayo Duran permission to include investors in his lawsuit charging Wells Fargo, Greenpoint Mortgage Funding and others with mortgage appraisal and origination fraud (Case #09-03703-CA). This development comes days after the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, sued 17 large banks and financial institutions over losses on about $200 billion of subprime bonds, as well as, AIG's lawsuit against the Bank of America claiming that it lost $10 billion in a "massive fraud."

"It's believed the defendants, just like in the other high-profile cases, fraudulently induced others to invest in mortgage-backed securities supported by scores of defective loans," said Duran. "Basically the defendants generated or acquired any loan, no matter how risky, that could be sold to third party investors. I was an unsuspecting victim who applied for a loan, but was duped into something else."
Duran alleges in his lawsuit that the fraud began when he tried to refinance his primary residence in 2005. He purchased the home in 2004 with an initial down payment of $100,000. Shortly after the purchase, Duran needed to access some of the down payment money to pay for a few personal and business obligations. Duran alleges that the Wells Fargo mortgage broker baited and switched him into a subprime home mortgage with Greenpoint.

"She created my loan by adjusting the value of my home to my debt-to-income ratio," said Duran. "They never considered my ability to repay the loan while the hired appraiser dramatically overinflated the value. All they cared about was that appraised value and my good credit score. What I also discovered was that the Wells Fargo representative was actually originating a loan for Greenpoint Mortgage Funding. After closing my loan, Greenpoint sold it right back to Wells Fargo as trust administrator for a pool of loan."

According to the lawsuit, Wells Fargo eventually placed Duran's loan in a trust called Credit Suisse First Boston Mortgage Securities Corp. Adjustable Rate Mortgage Trust 2005-5, Adjustable Rate Mortgage-Backed Pass-Through Certificates, Series 2005-5, Trust and Investors 1-1000. Duran's attorneys say it's not clear if this entity is the true holder of his note because Greenpoint has concealed the details and hasn't complied with demands to determine the rightful owner.

Gonzalo R. Dorta, a noted trial attorney who has experience in handling complex litigation matters, especially David and Goliath-type battles against major corporations, is representing Duran.

Through a jury trial, Dorta and other members of Duran's legal team hope to rescind the note and mortgage, to obtain restitution for wrongful acts, and to recover significant punitive damages. According to the lawsuit, attorneys request that an award of no less than $100,000,000.00 be entered as an award of punitive damages to be utilized to create a mandatory program for foreclosure mitigation and loan modification that adequately corrects, compensates and assists home owners within the Court's jurisdiction to save their homes from "these unscrupulous, deceptive fraudulent and intentional practices of Wells Fargo & Company, Wells Fargo Bank, Wells Fargo Home Mortgage and Greenpoint."

Duran said he is current with his monthly mortgage despite the bank's constant efforts to push him into default.

Additional Comments from Pelayo Duran:

It seem clear now, that the investors who bought these pools of toxic loans are successfully suing the American banks who originated all these fraudulent and toxic loans in order to be made whole for their losses. All this while the unsuspecting homeowner who were the true victims of the fraud lie homeless in my America, with no meaningful form redress for their injuries.

Someone has to stand up for the rights of these homeowners who are all loosing their homes as a result of what has now been exposed as a fraudulent scheme that defrauded millions of unsuspecting Americans by artificially and fraudulently inflating the value of real estate and then passing on the risk of obvious default to investors while reaping millions of dollars in illegal profits.

These banks claim they are too big to fail, but what they forget is that no American is too small to succeed.

I believe in our legal system and I have faith that I will eventually bring all these wrongdoers to Justice by exposing their misdeed.

This is what America stand for. America is a country where one average person can change the lives of millions of people by seeking justice from our courts.

I am honored to serve the American people and to be able to continue to defend (in court) the "American Dream" that my parents moved to this country for and that I am obligated to defend for generations to come.

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