Racketeering Class Action Filed on Behalf of Foreclosed New York State Homeowners

For those of you that have followed me at http://www.flippingfrenzy.com, as guest writer, http://www.TheMortgageCorner.blogspot.com, http://www.GoldmanSachs666.com as well as this blog, you will remember that I have been screaming RICO for quite some time now.

The shenanigans on Wall Street, Main Street banks and our Judicial system have wreaked of Racketeering long before the so called “economic crisis” ever occurred.

Racketeering Class Action Filed on Behalf of Foreclosed New York State Homeowners from LawyersandSettlements.com

New York, NY: On August 17, 2010, a Federal Class Action Complaint was filed on behalf of tens of thousands of New York State homeowners who lost their homes to an alleged foreclosure fraud orchestrated for years by a New York “foreclosure mill” attorney and major mortgage companies.
Read full story…click here

WIKIPEDIA explains RICO as follows:

The Racketeer Influenced and Corrupt Organizations Act (commonly referred to as RICO Act or RICO) is a United States federal law that provides for extended criminal penalties and a civil cause of action for acts performed as part of an ongoing criminal organization. RICO was enacted by section 901(a) of the Organized Crime Control Act of 1970 (Pub.L. 91-452, 84 Stat. 922, enacted October 15, 1970). RICO is codified as Chapter 96 of Title 18 of the United States Code, 18 U.S.C. § 1961–1968. While its intended use was to prosecute the Mafia as well as others who were actively engaged in organized crime, its application has been more widespread.

Summary
Under RICO, a person who is a member of an enterprise that has committed any two of 35 crimes—27 federal crimes and 8 state crimes—within a 10-year period can be charged with racketeering. Those found guilty of racketeering can be fined up to $25,000 and sentenced to 20 years in prison per racketeering count. In addition, the racketeer must forfeit all ill-gotten gains and interest in any business gained through a pattern of “racketeering activity.” RICO also permits a private individual harmed by the actions of such an enterprise to file a civil suit; if successful, the individual can collect treble damages.

When the U.S. Attorney decides to indict someone under RICO, he or she has the option of seeking a pre-trial restraining order or injunction to temporarily seize a defendant’s assets and prevent the transfer of potentially forfeitable property, as well as require the defendant to put up a performance bond. This provision was placed in the law because the owners of Mafia-related shell corporations often absconded with the assets. An injunction and/or performance bond ensures that there is something to seize in the event of a guilty verdict.

In many cases, the threat of a RICO indictment can force defendants to plead guilty to lesser charges, in part because the seizure of assets would make it difficult to pay a defense attorney. Despite its harsh provisions, a RICO-related charge is considered easy to prove in court, as it focuses on patterns of behavior as opposed to criminal acts.[4]

There is also a provision for private parties to sue. A “person damaged in his business or property” can sue one or more “racketeers.” The plaintiff must prove the existence of a “criminal enterprise.” The defendant(s) are not the enterprise; in other words, the defendant(s) and the enterprise are not one and the same. There must be one of four specified relationships between the defendant(s) and the enterprise. A civil RICO action, like many lawsuits based on federal law, can be filed in state or federal court.[5]

Both the federal and civil components allow for the recovery of treble damages (damages in triple the amount of actual/compensatory damages).

Although its primary intent was to deal with organized crime, Blakey said that Congress never intended it to merely apply to the Mob. He once told Time, “We don’t want one set of rules for people whose collars are blue or whose names end in vowels, and another set for those whose collars are white and have Ivy League diplomas.”[4]


It will be interesting to see how this case develops.  It is a gutsy charge in a judicial system that protects financial criminals especiallyl Wall Street.  However, New York is among a handfull of states whose judges have consistently ruled against the fraudulent bankers in many foreclosure casses.  These judges – who we have written on in the past – have had the “guts” to uphold the laws and rule in favor of truth.  This being said, this RICO case may have some very interesting affects on how the rest of the country’s judicial system looks at foreclosure cases.

Contents of the Wikipedia definition of RICO…click here

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