Excerpt from FIRST AMENDED COMPLAINT: Abeel et al. v. Bank of America N.A. et al.

Abeel et al. v. Bank of America N.A. et al.,

USDC/EDNY Case No. 1:12-cv-04269-JBW-RML

VERIFIED FIRST AMENDED COMPLAINT FOR DAMAGES AND INJUNCTIVE RELIEF

[JURY TRIAL DEMANDED]

2802. Defendants, and each of them beginning in paragraph 1068 and concluding in

paragraph 2,725, are all entities of unknown form, a.) located and doing business in

the State of New York, and b.) in the business of creating a negotiation trail of all

Defendants’ negotiable instruments and other legal paperwork (including, but not

limited to promissory notes and assignments) in a way to create an appearance of

propriety under the Uniform Commercial Code when in fact there is no propriety

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whatsoever and these Defendants are the core of the ponzi and RICO money

laundering schemes set forth in detail above. These Defendants have knowingly

conspired and assisted in each and every violation of law and the ponzi, RICO and

money laundering schemes set forth herein could not have occurred without them

These Defendants are collectively referred to hereinafter as "New York Loan Pools."

2803. At all times material hereto, the business of Defendants was operated through a

common plan and scheme designed to conceal from Plaintiffs the material facts set

forth below. Such facts were also concealed from the public and from regulators,

either directly or as successors-in-interest to the business acquired from others. The

concealment was completed, ratified and/or confirmed by each Defendant herein

directly or as a successor-in-interest as the acquirer of an entire business, and each

Defendant performed or has sought to benefit from the tortious acts set forth herein

for its own monetary gain and as a part of a common plan developed and carried out

with the other Defendants or as a successor-in-interest to the business that did the

foregoing.

2804. Plaintiffs allege that each of the wrongful acts or omissions described below was

performed either by each Defendant herein, named or unnamed, or ratified and

adopted by each Defendant after its occurrence.

2805. Further, those Defendants that did not actively perform the acts or omissions

described in this Complaint did affirmatively aid and abet the other Defendants in the

performance of such acts of omissions, before, during or after the fact.

2806. Finally, each Defendant herein, named or unnamed, did knowingly derive some

form of profit or benefit from the acts and omissions described herein.

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2807. All Defendants agreed to work together in the conspiracy and/or joint enterprise

described in this Complaint based upon an express agreement among all Defendants

to convert plaintiffs’ monies and personalty in the manner described herein.

Accordingly, each Defendant, named or unnamed, should be held liable for the acts

and omissions of all other Defendants with respect to the causes of action set forth

below.

2808. The true names and capacities of the Defendants listed herein as DOES 2 through

1,000 are unknown to Plaintiffs who therefore sue these Defendants by such fictitious

names. Upon learning the true names and capacities of the DOE Defendants,

Plaintiffs shall amend this Complaint accordingly.

2809. Each of the Defendants herein, named or unnamed, was the agent of each of the

other Defendants herein, named or unnamed, and thereby participated in all of the

wrongdoing set forth below. Thus, each such Defendant is responsible for the acts,

events and concealment of every other such Defendant as set forth below.

2810. Defendants’ wrongful acts include (but are not limited to) the following: (i)

claiming to be servicer of the subject notes at issue herein and demanding monthly

loan payments therefor, when in fact no Defendant had or has any legal claim to the

monies paid to it by Plaintiffs; (ii) taking loan payments every month from each

Plaintiff without crediting any portion of that money to the benefit of any Plaintiff;

(iii) promising loan modifications to Plaintiffs while never being an authorized legal

representative of any person in a position to actually modify Plaintiffs’ loans; (iv)

inducing Plaintiffs to default on their loans so that Defendants could profit from the

credit default swaps they had purchased, betting that such loans would not be paid as

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agreed; (v) creating false reasons for charging fees to Plaintiffs based upon

nonexistent monies owed, then instituting foreclosure proceedings against Plaintiffs

when such fees went unpaid; (vi) issuing wrongful Notices of Default to Plaintiffs;

(vii) by refusing to respond, in any way, to Plaintiffs' communications or to

communications made for Plaintiffs by their private and public representatives; (viii)

converting Plaintiffs’ monies as alleged in great detail below, (ix) secreting such acts

of conversion through the massive international network used by defendants to

support their Ponzi scheme in violation of law.

VI. ADDITIONAL FACTS OF THE RICO, MONEY LAUNDERING AND PONZI SCHEMES

2811. This is the largest scheme in United States history where domestic banking

institutions – on an international basis, involving all Defendants herein and their coconspirators

operating together in a common enterprise as set forth below – engaged

in an institutional, worldwide scheme to steal, rob and convert the personal property,

money and proceeds of such assets3 of each Plaintiff herein on the dates, in the sums

and with the modus operandi set forth below.

2812. This modus operandi of Defendants herein includes their decade-long and

systematic conversion and “Ponzi scheme” approach that damaged millions of

borrowers across the United States.

2813. Defendants’ elaborate scheme consisted of – and continues to consist of –

numerous business designs, structures and arrangements operated by all Defendants

herein. These have included enterprises of each Defendant as set forth herein, that

dealt in the converted assets of tens of thousands of American homeowners –

3 To be clear, Plaintiffs make no allegation whatsoever that any Defendant herein – individually or

in conspiracy with any other Defendant – has converted any real property.

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including the Plaintiffs herein--and secretly transferred them nationally and

internationally into a gigantic ongoing “Ponzi scheme.”

2814. Because of the economic meltdown of 2007 and beyond, this Ponzi scheme has

required the creation of more and more shell entities, and other money-raising

vehicles used by Defendants herein in order to support the raising of additional

money in order to continue to hide the converted assets.

2815. The entire purpose of Defendants’ Ponzi/RICO scheme has been to hide the

converted assets of Plaintiffs (and other victims similarly situated) deeply and entirely

so that Plaintiffs and other victims become incapable of ever recovering the funds and

personalty converted from them.

2816. The assets unlawfully converted and stolen by all Defendants as a part of their

conspiracy, as well as instrumentalities used by all Defendants to continue the

conversion and secreting of Plaintiffs’ assets that are known as of the date of filing

hereof, included and continue to include the following:

a. Plaintiffs’ money, as set forth below (conversion);

b. Negotiable instruments improperly negotiated under state and federal law, as set forth

below (instrumentality);

c. Private identity information of certain Plaintiffs, as set forth below (conversion);

d. Other private information of certain Plaintiffs taken by Defendants in violation the

provisions of the United States Constitution, as alleged below (conversion);

e. Mortgages or deeds of trust transferred secretly in violation of law, as set forth below

(instrumentality);

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f. Mortgaged-backed securities used merely to shield and hide the movement of assets

converted from Plaintiffs outside of the United States (instrumentality);

g. Bond or debt securities – which Defendants began calling “hybrid” securities during

the pendency of this action – used merely to perpetuate the Ponzi scheme and thus

shield and hide the movement of assets converted from Plaintiffs outside of the

United States (instrumentality);

h. Money laundering of proceeds of the above-described activity, as set forth in detail

below (conversion and instrumentality);

i. Conversion and larceny where Defendants, and each of them, intended to and did in

fact use Plaintiffs’ money and other converted property to perpetuate their Ponzi

schemes through the use of thousands of companies internationally – funded with

converted monies for the purpose of hiding the trail of conversion and secretion –

involving trillions of dollars.

2817. Without Defendants’ theft of Plaintiffs’ money and other property – as alleged

herein – none of the mortgage, securities, money laundering and/or Ponzi schemes

described herein could have been initiated, perpetuated or maintained. The money

converted from the Plaintiffs and other consumers nationwide has always been the

“fuel” for the schemes alleged herein.

2818. Included in the scheme as a key instrumentality – but not the fundamental purpose

of the scheme – was and is all Defendants’ intention to foreclose on the homes of

homeowners, including Plaintiffs herein, with respect to promissory notes that are

each void ab initio as a result of all Defendants’ intentional violation of state and

federal laws promulgated to assure complete transparency and compliance with all

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applicable laws with respect to the appropriate and lawful negotiation and transfer of

such negotiable instruments.

2819. Each Defendant herein is the agent, servant, and co-conspirator of each other

Defendant and all Defendants herein operated with their core modus operandi to steal

and convert the money and valuable personal property of each Plaintiff (and

thousands of other victims) and then to transfer that stolen money (and property) to

(a) the other Defendants herein, and to (b) other entities in at least 30 foreign

countries according to proof.

2820. In addition, Defendant BofA has admitted the involvement of co-conspirators (a)

located in countries without treaties with the United States of America and (b)

pursuant to instruments and prospectuses that purport to dissuade (but not expressly

prohibit) the involvement of such foreign countries.

2821. Defendants, and each of them, have operated and continue to operate the largest

Ponzi scheme in world history with a plan that – at its inception – was intended to,

did in fact and continues to the present day to have as its object the theft and

conversion of billions of dollars from millions of homeowners, including Plaintiffs.

2822. Plaintiffs became caught up in the tangled Ponzi-scheme-web of Defendants

innocently under the guise of applying for a routine home loan or refinancing of an

existing home mortgage loan, and have been trying to recover back their money in the

sums alleged herein without success ever since. Because of Defendants’ intentional

and longstanding secretion of their prior and current unlawful conduct, the trail is

growing cold and will ultimately be frozen absent the issuance of immediate

injunctive relief as prayed for herein.

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2823. Defendants have failed and refused to return Plaintiffs’ money as alleged herein

despite (a) Plaintiff’s repeated requests, (b) Defendants’ promises to return the money

and property, on a consistent month-to-month basis, (c) Interventions by federal and

state governments commanding Defendants to either return the money, or provide a

transparent plan identifying systems through which money and property could be

identified, located and legitimately returned or otherwise accounted for.

2824. The foregoing modus operandi of all Defendants herein – acting in concert with

each other and for the common goal of both stealing Plaintiff’s money and then

hiding any documentary proof thereof – began in 2003.

2825. At that time, each Defendant (or their predecessors) adopted a calculated business

strategy that transferred ownership of the promissory notes executed by home loan

borrowers to persons that were not entitled to receive negotiation thereof under

applicable law, and knew it but joined the conspiracy for purposes that amounted to

greed. Such conspiracy has continued to the date of filing hereof, but all Defendants

with knowledge and malice aforethought.

2826. Defendant Countrywide and its various affiliates were among the leading

providers of mortgages in California during all times relevant to this Complaint. By

2005, Countrywide was the largest U.S. mortgage lender in the United States,

originating over $490 billion in mortgage loans in 2005, over $450 billion in 2006,

and over $408 billion in 2007.

2827. The other Defendants (or their predecessors in interest, such as WAMU and

Wachovia) are the other largest home loan mortgage lenders in the United States, and

were all involved in the conspiracy described herein.

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2828. The modus operandi of the various Defendants was to use the numerous

methodologies set forth in this Complaint to convert money and property from

consumers after the origination of their loan. By 2007, this modus operandi had

evolved into a massive international Ponzi scheme relying upon foreign investor

sources to secure and pay off money injected into the systems of the Defendants by

prior lending sources and by Defendants’ prior theft of borrower money (including

Plaintiffs’).

2829. As of the end of 2007, Defendants had no definitive and reliable knowledge

regarding which foreign entity or entities in fact “owned” – as that term is defined

under Article 3 of the Uniform Commercial Code -- any promissory note secured by

any deeds of trust or mortgages securing Plaintiffs’ real properties.

2830. Consequently, some of the largest offenders—Countrywide, WAMU, and

Wachovia--became hopelessly insolvent and was literally forced by federal regulators

to commence negotiations with various large bank to effectuate mergers designed to

“clean up” these international Ponzi and conversion schemes.

2831. In 2007, Defendant BofA commenced negotiations to acquire Countrywide. By

late 2007, BofA began merging its operations with Countrywide and adopting some

of Countrywide’s practices.

2832. WAMU was one of the largest residential mortgage lenders in the United States.

However, its predatory lending practices caused it to fail. In September 2008, Chase

purchased the assets and liabilities of WAMU for approximately $1.9 billion and

began merging it into its operations into Chase by adopting some of its practices.

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2833. In 2008, Wachovia was the fourth-largest bank holding company in the United

States. However, Wachovia began to fail due to its lending practices, including those

described herein. In December 2008, Wells Fargo acquired the assets of Wachovia in

order to prevent it from failing, and spent nearly three years merging its operations

into Wells Fargo, including adopting some of its practices.

2834. All of the Defendants have taken steps to continue the Ponzi/RICO scheme

described herein. Specifically, they have continued to pool mortgage notes into pools

for purposes of selling them as so-called mortgage-backed securities, thereby forever

severing the promissory notes from the mortgages that secure them.

2835. The Defendants have also acted to foreclose upon homes owned by the Plaintiffs

and other individuals by collecting payment in full through a device called a

mortgage default swap (“MDS”), whereby the defaulted mortgage would be replaced

with a new one. The original lender had already been paid when it transferred the

promissory note, so there was no loss to the lender. These lenders foreclose anyway,

meaning that they are being paid more than once for the same loan, leading to

windfall profits when they sell the properties that they seize through foreclosure.

2836. The fraud perpetrated by the Defendants was willful and pervasive. It began with

simple greed and then accelerated when the lenders discovered that they could not

sustain their business, unless they (a) used their size and large market share to

systematically create false and inflated property appraisals throughout the United

States and with respect to each Plaintiff herein and (b) used their network of

companies to convert money from unsuspecting borrowers in the United States,

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including Plaintiffs, who had good reason at the time to rely upon these fraudulent

appraisals and concealment of their intentional, illegal activities.

2837. The Defendants then used these false property valuations, their resulting

conversion of monies, and their ongoing Ponzi scheme to finance an operation of

agents, including all Defendants and other parties, in order to induce the Plaintiffs and

other borrowers into signing documents purportedly confirming ever-larger

“refinancing” of their existing mortgages, or to execute promissory notes so that the

Defendants could later convert more money and property from them.

2838. The Defendants either knew, or should have known, no later than 2004, that these

loans were unsustainable for the lenders and the borrowers and to a certainty either

knew or should have known that their fraudulent activity would result in a crash that

would consume the equity invested by the Plaintiffs and all other borrowers.

2839. The Defendants either knew, or should have known, no later than 2004, that the

foregoing misconduct would result in their ability to convert monies from Plaintiffs

(and thousands of other homeowners) subsequent to their pooling of these promissory

notes as mortgage-backed securities (“MBS”) that would be sold on the open market

to various institutional investors for inflated values.

2840. This system led to the Defendants making multiple sales of the same promissory

notes to multiple MBS pools. These multiple sales of the same promissory notes to

multiple buyers do not create ownership of such negotiable instrument under Article 3

of the Uniform Commercial Code.

2841. The plan to pool these loans into MBS offerings grew into a brazen plan to

disregard underwriting standards and fraudulently inflate property values – county-

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by-county, city-by-city, person-by-person – in order to take business from legitimate

mortgage-providers, and developed into a massive securities fraud that depended on

the concealment from and deception of the Plaintiffs as to the true nature of these

transactions on an unprecedented scale. In this way, the Defendants would be able to

convert money from the Plaintiffs without such Plaintiffs having any idea or

knowledge of the dirty and unlawful plot at the time it was being implemented.

2842. As early as 2004, the Defendants either knew or should have known that this

scheme would cause a liquidity crisis that would devastate the Plaintiffs’ home values

and net worth.

2843. The Defendants did not care, because their plan was based on insider trading –

pumping for as long as they could and then dumping before the truth came out and

the theft and conversion of money and assets from Plaintiffs as well as the general

public were locked in.

2844. Couched in banking and securities jargon, the deceptive gamble with consumers’

primary assets – their homes – was nothing more than a financial theft and concurrent

Ponzi scheme perpetrated by Defendants and their co-conspirators on a scale never

before seen.

2845. This scheme led directly to a nationwide mortgage meltdown that was

substantially worse than any economic problems facing the rest of the United States,

thereby causing the failure of numerous lenders.

2846. From 2008 to the present, Americans’ home values decreased substantially as a

direct and proximate result of the Defendants’ scheme set forth herein, leaving a large

percentage of homeowners “upside down”, meaning that they owe more on their

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home mortgage loans than their homes are worth. In some instances, those homes are

so far upside down that it could take a decade or more for the homeowners to regain a

positive position with respect to the value of their homes.

2847. This massive fraudulent scheme was a disaster both foreseen by the Defendants as

well as waiting to happen. Defendants knew it, and further knew that the taxpayer

money would bail out those lenders deemed too big to fail.

2848. The lenders involved – Defendants herein – embarked on a plan and scheme to

use the good faith of taxpayer money and the country’s trust and confidence in the big

banks that acquired Countrywide, WAMU, and Wachovia to (a) further hide their

nefarious conversion scheme, (b) engage in additional acts of conversion and

secreting of the knowledge thereof and (c) use new laws and initiatives as a basis to

induce unsuspecting homeowners to fall further victim to their ongoing expansion of

the foregoing scheme throughout the world.

2849. As a result, the Plaintiffs lost money and any ability to actually pay off their

promissory notes, their credit ratings and histories were damaged or destroyed, and

they also incurred material other costs and expenses, all as described herein.

2850. At the same time, Defendants converted from Plaintiffs and other borrowers

across the country billions of dollars in interest payments and fees and generated

billions of dollars in profits by vastly expanding the scheme previously unique to just

a few predatory lenders such as Countrywide and now subject to the power of (a) a

new, larger and more credible parents, such as BofA, Chase, and Wells Fargo and (b)

the influx of new dollars in the form of taxpayer money and increased investment by

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investors knowledgeable of the Ponzi scheme to such an extent that they were coconspirators

in it.

2851. The Defendants then began to use their customers’ most private information to

maximize their illegal gains, ranging from the disclosure of the most private and

confidential information of more than 2.4 million customers, to the outsourcing and

sale of hundreds of thousands of records to bolster their fraudulent scheme,

disenfranchising citizens of their constitutional inalienable right of privacy.

2852. When the Defendants pooled the loans they originated and sold in MBS

secondary mortgage market transactions, those lenders recorded gains on the sales. In

2005, Countrywide reported $451.6 million in pre-tax earnings from capital market

sales; in 2006, it recognized $553.5 million in pre-tax earnings from that activity.

2853. However, after the liquidity crisis hit, in 2007 it recognized a mere $14.9 million

in pre-tax earnings from that activity and reported an overall pre-tax loss.

2854. In addition, there is a lot of confusion, even among the mortgage companies, as to

the ownership history of many mortgage loans. In the mad rush to convert home

mortgages into securities to be bought and sold on Wall Street, investors did not want

to spend the time or money necessary to keep track of ownership by filing papers in

local recording offices.

2855. Investors by-passed the traditional systems and replaced them with the MERS

system, which is not only inherently unreliable and unverifiable, it also remains

outside the public eye.

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2856. As a result, it is no longer possible for most Americans to go to their local

courthouse and look at property records to find out who the owner of their mortgage

currently is.

2857. To make matters worse, the Defendants established their concealment network

now alleged entity-by-entity in this complaint, and this network has made it

impossible to track the negotiation techniques and rights to possession of promissory

notes, which are not publicly recordable.

2858. The illegal and improper acts of the Defendants have continued, including, inter

alia: (i) engaging in the practice of “robo-signing,” whereby the lenders used people

who had no personal knowledge to sign fraudulent and perjured affidavits that

indicated that they had personal knowledge of those matters in an effort to deprive

homeowners of their property without due process of law; (ii) refusing to modify

loans; and (iii) refusing to entertain short sale opportunities, all with the intention to

(a) buy time to further conceal previous conversions and/or (b) convert additional

monies from the Plaintiffs in a sum according to proof.

2859. Many of the Plaintiffs were told not to make mortgage payments and/or to sign

letters authored by agents of Defendants, exacerbating a desperate financial situation

that was either untrue or inflated at Defendants’ insistence. This was all done in order

to buy time for Defendants to further secret the conversion of funds practiced against

the Plaintiffs and to support other conversions of monies that Defendants were bent

on practicing.

2860. Defendants have gone to great lengths to avoid identifying the location of monies

and property converted by them from Plaintiffs. The gigantic network of Defendants

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and their co-conspirators–companies formed in countries such as the Cayman Islands,

Luxembourg, Gibraltar and Chile for the purpose of hiding assets and laundering

money–has been, and continues to be, used to systematically hide and ultimately

destroy the evidence revealing the method of conversion used and the location of the

money and personalty converted by Defendants.

2861. By these tactics, systems, and delays, Defendants intend to and are in fact buying

time as they (a) accept the benefits of the Ponzi scheme and conversion activities

described herein, (b) cover up their historical conversion and Ponzi scheme, and (c)

make it materially more expensive and difficult for the Plaintiffs to locate their stolen

assets and gain recompense.

2862. Defendants herein include some of our leading financial institutions – institutions

upon which the Plaintiffs thought they could rely, and did in fact rely upon.

However, their reliance was misplaced. As is clear from the mounting number of

federal and state enforcement actions against Defendants, it is now widely recognized

that they have committed numerous illegal acts in the process of operating their

mortgage businesses. BofA alone has been sued for trillions of dollars as a result of

its involvement in these activities.

2863. These acts remain ongoing, and continue to threaten the Plaintiffs’ constitutional

rights and financial security, as well as the economic future of the United States of

America.

2864. The Defendants either knew or should have known that the scale of the lending –

based on inflated property values, without income verification and in violation of

numerous other underwriting guidelines – would lead to widespread declines in

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property values, thereby placing Plaintiffs and others into extremis through which

they would lose the equity invested in their homes and have no means of refinancing

or selling, other than at a complete loss.

2865. That is precisely what happened to the Plaintiffs herein after Defendants

converted their money and the equity in their homes, but before Plaintiffs could have

possibly realized the ultimate purpose of the Defendants’ scam.

2866. While the following quotation, taken from a regulatory report, refers specifically

to Countrywide, which was portrayed as a prudent, quality lender, it also applies to

the business practices of all Defendants. “But the real Countrywide was very

different. We allege it was a company that underwrote loans in a manner that layered

risk factor upon risk factor, such as reduced documentation . . . [a]lso concealed from

investors were concerns voiced by Countrywide’s own Chief Credit Risk Officer,

who warned that this ‘supermarket’ strategy reduced Countrywide’s underwriting

guidelines to a ‘composite of the riskiest products being offered by all of their

competitors combined.’”

2867. The Defendants held themselves out as makers of prime quality mortgage loans,

but instead hid the fact that they, in an effort to increase their respective market

shares, engaged in an “unprecedented expansion of its underwriting guidelines from

2005 and into 2007.” Specifically, the Defendants developed what was referred to as

a “supermarket” strategy, where they attempted to offer any product that was or might

be offered by any competitor.

2868. By the end of 2006, Defendants’ underwriting guidelines were as wide as they

had ever been, and they were writing riskier and riskier loans. Even these expansive

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underwriting guidelines were not sufficient to support their desired growth, so the

lenders wrote an increasing number of loans as “exceptions” that failed to meet their

already wide underwriting guidelines even though exception loans had a higher rate

of default.

2869. The covert scheme of the Defendants was, like all such schemes based on

deception, ultimately unsustainable. The Defendants relied upon their sales of

mortgages into the secondary marked through MBS instruments as an important

source of revenue and liquidity.

2870. The Defendants not only covered up the poor quality of their loans and the

liquidity crisis they created, they intentionally misrepresented to the public, in

statements and in public filings, the nature of those loans in an effort to further

defraud the public into continuing to borrow money and put their assets at risk.

2871. The Defendants’ scheme eventually collapsed under its own weight, precipitating

an economic crisis of unprecedented proportions.

2872. As defaults on these poorly underwritten loans increased, Defendants used the

opportunity presented by the rising number of defaults to increase their fees and

further convert other funds from Plaintiffs and other borrowers.

2873. To add insult to injury, as the number of defaults rapidly rose, the Defendants

added unreasonable additional fees to the mortgages of homeowners who were

desperately trying to save their homes, thereby boosting their profits at the expense of

those who could least afford to bear that burden.

2874. Defendants did the foregoing with the intent to convert funds from the Plaintiffs

and other members of the public. The Plaintiffs did not know the massive scheme that

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the Defendants had devised and never knew until it was far too late to prevent the

massive network being used across the globe to hide the trail of converted money and

property.

2875. As a proximate and foreseeable result of the Defendants’ sale of the promissory

notes pertaining to the properties of the Plaintiffs and others similarly situated for

more than the actual value of such instruments, the MBS securitization pools lacked

the cash flow necessary to maintain them in accordance with the terms of their

indentures. The unraveling of Defendants’ scheme has materially depressed the price

of real estate throughout the country, including the real estate owned by the Plaintiffs,

resulting in the losses to the Plaintiffs described herein. The conversion of Plaintiffs’

money by Defendants – and each of them operating through their RICO scheme – has

materially injured the tangible net worths of Plaintiffs and the Treasury of the United

States of America.

2876. The Defendants have made use of wholly or partially owned foreign companies in

an effort to continue to hide and to misrepresent the ownership of the promissory

notes executed by the borrowers, including the Plaintiffs, who borrowed funds from

them.

2877. BofA, Chase, and Wells Fargo have ratified the bad acts of WAMU,

Countrywide, and Wachovia, by intentionally making use of foreign companies to

frustrate the Plaintiffs and other borrowers seeking information about their lost

money, mortgages and loan modifications. All Defendants have joined in this

conspiracy – indeed most Defendants were formed for purposes associated with the

money laundering, ponzi and RICO enterprises set forth herein. All Defendants have

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acted in conspiracy with one another appertaining to each and every act set forth in

this complaint.

FIRST CLAIM FOR RELIEF

Conversion

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2878. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

2879. All Defendants have demanded and received payments from the Plaintiffs based

upon the claim of these Defendants that such monies are owed on the loans and

promissory notes at issue herein.

2880. These Defendants have further demanded and received from Plaintiffs payments,

imbursements for late charges, penalty fees, and trial loan modification payments.

2881. In truth, on information and belief, these Defendants had and have no legal right

to be demanding such payments from Plaintiffs for any loans or promissory notes or

loan modifications at issue herein because these Defendants are not holders or owners

of the promissory notes in question and they no longer know who is.

2882. Further, Defendants are not the authorized representative or agent for the holders

or owners of the promissory notes in question.

2883. In truth, the monies collected from the Plaintiffs by these Defendants was not

credited for the benefit of the individual Plaintiffs involved, in that it was not used to

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pay down that Plaintiff’s (or any Plaintiff’s) principal and/or interest purportedly due

on his or her promissory note.

2884. Thus, in taking monies from Plaintiffs as described above, these Defendants are

liable to Plaintiffs herein for conversion, i.e., the act of dominion wrongfully exerted

over another person’s personal property. In taking the money from Plaintiffs as

described above, Defendants converted between $35,000 and $70,000 per Plaintiff

over the course of their business dealings with Defendants. Defendants had no right

to these funds and engaged in money laundering both domestically and

internationally in order to hide the theft, larceny and conversion set forth herein. It is

impossible for Plaintiffs to know with certainty the exact amount of funds converted

because Defendants have provided inconsistent, varying and false accounts of the

monies they have received from Plaintiffs herein.

2885. These claims of conversion are based upon the facts that a) each Plaintiff had

ownership and the right to possession of the monies taken from him by these

Defendants as described above; b) these Defendants acted wrongfully by receiving

such money under the guise that the Defendants were entitled to the money, when in

fact they were and are not entitled to any such payment; c) no money collected by

these Defendants from these Plaintiffs was credited to the benefit of the individual

Plaintiff involved for the pay down of any principal or interest purportedly due on

that Plaintiff’s note; and d) each Plaintiff suffered general and special damages,

including loss of the money that was taken from them by these Defendants through

this subterfuge, according to proof.

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2886. These Defendants also committed conversion as against each Plaintiff by

converting equity that previously existed in each Plaintiff’s home – in sums according

to proof – by surcharging against that equity various false “reserves” in the form of

“insurance” or “tax” or “general” reserve imbursements, which were then recorded as

debts against the property of the individual Plaintiff involved.

2887. Just as banks are liable to a customer and must credit his account for conversion

when banks pay on a forged indorsement of a commercial instrument, so too are these

Defendants liable for these false surcharges improperly charged against a Plaintiff’s

account.

2888. As a direct and proximate result of the conversion committed by the Defendants,

each Plaintiff suffered general and special damages according to proof.

2889. Each Plaintiff is further entitled to restitution of those amounts wrongfully

converted from him or her.

2890. These Defendants willfully committed the wrongdoing against each Plaintiff as

described herein and knowingly chose to deceive him or her in the above-described

manner. Thus, the acts of these Defendants were malicious and performed with a

callous disregard for Plaintiffs’ legal rights. Plaintiffs are therefore entitled to

punitive damages. Plaintiffs are further entitled to attorney fees under whatever

contract or statute applies.

2891. All Defendants have converted and stolen – in the manner, using the means of

interstate commerce as set forth herein – the sum of at least between $40,000.00 and

$60,000.00, from each Plaintiff herein.

2892. In no event has any Plaintiff herein suffered damages greater than $75,000.00.

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SECOND CLAIM FOR RELIEF

Conspiracy to Commit Conversion

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2893. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

2894. Plaintiffs allege that each of the wrongful acts or omissions described in the First

Cause of Action for Conversion above was either performed by each Defendant

herein, named or unnamed, or ratified and adopted by each Defendant after its

occurrence.

2895. Further, those Defendants that did not actively perform the acts or omissions

described here did affirmatively aid and abet the other Defendants in the performance

of such acts or omissions, either before, during, or after the fact in the form of

concealment and secretion activities worldwide. Such activities represent additional

acts of conversion under law.

2896. Finally, each Defendant herein, named or unnamed, did knowingly derive some

form of profit or benefit from the acts and omissions described herein. All Defendants

agreed to work together in the conspiracy and/or joint enterprise described in this

Cause of Action as set forth herein. Accordingly, each Defendant, named or

unnamed, should be held liable for conspiracy to commit the conversion as alleged in

the First Cause of Action.

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2897. The Plaintiffs are entitled to the damages as alleged and described in the First

Cause of Action – and as alleged above – as a direct and proximate result of this

conspiracy of all Defendants to commit repeated and serial acts of conversion against

these Plaintiffs as described herein.

2898. These Defendants willfully committed the wrongdoing against each Plaintiff as

described herein and knowingly chose to deceive him in the above-described manner.

Thus, the acts of these Defendants were malicious and performed with a callous

disregard for Plaintiffs’ legal rights. Plaintiffs are therefore entitled to punitive

damages.

2899. In no event has any Plaintiff herein suffered damages greater than $75,000.00.

THIRD CLAIM FOR RELIEF

Intentional Misrepresentation

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2900. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

2901. The Defendants intentionally misrepresented to the Plaintiffs and to the

consuming public in general their intentions regarding the reasonableness and

appropriateness of their underwriting procedures in making mortgage loans to the

Plaintiffs, and also materially misrepresented to the consuming public that they were

not making quality loans when they told the consuming public that they were only

making quality, prime home loans.

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2902. The Defendants intentionally misrepresented to the public at large the status of

their liquidity and the quality of the loans that they were making.

2903. Those Defendants further intentionally misrepresented to the Plaintiffs that they

would not use or otherwise impose unreasonable or unfair charges against the

Plaintiffs and the rest of the consuming public, but they failed to do so.

2904. The campaign of concealment, misinformation and partial information described

in this Cause of Action as well as in the rest of this Complaint was intended to be

repeated and also to be broadly disseminated through the media, analyst reports and

individual communications, and it was.

2905. It was intended to become part of the well-understood “givens” among

homeowners and prospective homeowners seeking mortgages, and it did so become

part of the lexicon of homeownership and mortgage choices.

2906. These Plaintiffs relied upon the misrepresentations and entered into mortgages

with the Defendants.

2907. All of said intentional misrepresentations and omissions were made by the

Defendants with the intent to induce the consuming public, including the Plaintiffs, to

enter into mortgage loan transactions that would deprive them of the equity in their

homes.

2908. By reason of the prominence of the Defendants and their campaign of deception

as to their business plans and the relationship of trust developed between each of the

Defendants and the Plaintiffs, Plaintiffs were justified in relying upon Defendants’

representations.

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2909. At all times pertinent, the Plaintiffs in fact reasonably relied upon the

representations made by the Defendants that they would use reasonable and rational

underwriting guidelines in making mortgage loans to the consuming public and

entered into mortgage loan contracts with the Defendants, all to their injury and

detriment.

2910. In fact, the appraisals were inflated. The Defendants did not utilize appropriate

underwriting processes. The financial condition of the various Defendants was not

sound, but rather was a house of cards ready to collapse. Further, Plaintiffs’

mortgages were not refinanced with fixed rate mortgages as they were told they

would be, and the Defendants never intended that they would be.

2911. As a result of Defendants’ scheme described herein, these Plaintiffs could not

afford their adjustable rate mortgages when their variable rate features and/or balloon

payments kicked in.

2912. Further, and as a result of the nefarious scheme of the Defendants, the Plaintiffs

could not refinance or sell their residences without suffering a loss of their equity

investments.

2913. As a result of the foregoing acts of conversion and fraud, the Plaintiffs have lost

all or a substantial portion of the equity invested in their houses and suffered reduced

credit ratings and increased borrowing costs, among other damages described herein.

2914. As a result of the Defendants' misconduct alleged above, all negotiable

instruments appertaining or relating to Plaintiffs – whether or not an original or any

copy thereof is held by Defendants or any of their co-conspirators in their money

laundering schemes – may be declared to be void ab initio as determined by the trier

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of fact. In the event of such a finding by the trier of fact – that these negotiable

instruments are void ab initio – leads to a recovery for any Plaintiff, along with all

damages awarded herein, of a sum total of more than $75,000.00, each Plaintiff

generally and specifically waives, gives up, and disavows any such recovery in excess

of $75,000.00. Nothing set forth herein, however, should be construed to infer that

Plaintiffs agree to deprive the trier of fact of the right to adjudicate whether

negotiable instruments pertaining to them were or were not void ab initio, as such a

determination will impact the predicate conduct required for an award of punitive

damages and may impact other areas of Plaintiffs' case such that they are not required

to, and do not, in fact, agree to allow such critical issue to avoid scrutiny by the trier

of fact in this case.

2915. These Plaintiffs are further entitled to punitive damages in order to punish these

Defendants for their malicious, oppressive and willful conduct as described.

2916. Inclusive of all compensatory damages, special damages, attorney fees and

punitive damages alleged herein, each Plaintiff has sustained damage in a sum of not

greater than $75,000.00.

FOURTH CLAIM FOR RELIEF

Intentional Misrepresentation

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2917. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

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2918. In addition to the numerous acts of fraud described above, the Defendants

represented to multiple Plaintiffs and to the consuming public in general that the

Defendants would assist them in accomplishing a loan modification. As described

herein, those representations were false.

2919. Defendants knew that their representations regarding their willingness to enter

into loan modification agreements were false when they made them.

2920. Because of new laws pertaining to loan modifications combined with the

insistence of the Defendants that they had a genuine interest in complying therewith

and in keeping borrowers in their homes, the Plaintiffs reasonably relied on these

materially false misrepresentations made by the Defendants.

2921. By delaying the Plaintiffs from pursuing their rights and by increasing the costs of

the Plaintiffs combined with the continuing erosion of each Plaintiff’s credit rating,

each Plaintiff’s reliance harmed that particular Plaintiff.

2922. The Plaintiffs’ reliance on the representations made by the Defendants was a

substantial factor in causing harm to them.

2923. Without limiting the damages as described elsewhere in this Complaint, the

damages of the Plaintiffs arising from the matters complained of in this Cause of

Action also include the loss of equity in their houses, costs and expenses related to

protecting themselves, reduced credit scores, unavailability of credit, increased costs

of credit, reduced availability of goods and services tied to credit ratings, increased

costs of those services, as well as fees and costs, including, without limitation,

attorney fees and costs.

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2924. The Plaintiffs are entitled to recover general and special damages directly and

proximately resulting from the Defendants’ intentional deceit and misrepresentations.

2925. These Plaintiffs are further entitled to punitive damages in order to punish these

Defendants for their malicious, oppressive and willful conduct as herein described.

2926. Inclusive of all compensatory damages, special damages, attorney fees and

punitive damages alleged herein, each Plaintiff has sustained damage in a sum of not

greater than $75,000.00.

FIFTH CLAIM FOR RELIEF

Fraudulent Concealment

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2927. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

2928. Defendants have offered to help the Plaintiffs with obtaining “loan modifications”

while concealing from these Plaintiffs the fact that, upon information and belief, these

Defendants are not the rightful owners and/or holders of the subject promissory note

associated with their mortgages.

2929. The Defendants have also failed to disclose that they are not the legal

representatives or agents of such persons, and they have further failed to disclose that

the Defendants’ entire motivation and purpose in doing so has been, and continues to

be, the conversion of Plaintiffs’ monies and the taking of their homes in violation of

law.

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2930. Thus, these Defendants are legally incapable to be able to enter into loan

modifications with any Plaintiff.

2931. Despite that fact, the Defendants have had and continue to have a vested interest

in “offering loan modifications” to borrowers, including the Plaintiffs, because they

can make a profit from continuing to cover up the industry-wide scheme alleged

above and to create an environment where they can commit additional acts of fraud

and conversion.

2932. In fraudulently offering loan modifications to Plaintiffs, the Defendants have

convinced Plaintiffs that loan modifications will only be given to those borrowers that

are delinquent on their loans and/or in default.

2933. The Defendants have made these statements on an industry-wide basis in order to

permit them to continue their scheme of obtaining monies and properties from

Plaintiffs wrongfully and in violation of law.

2934. In reliance upon these materially false representations, and in the belief that they

would be able to obtain loan modifications if they followed these false and

misleading instructions, Plaintiffs have permitted their loans to go delinquent and/or

into default, believing this step to be a requisite of the loan modification process.

2935. At all times relevant, the Defendants possessed superior knowledge to that of the

Plaintiffs, and further had access to material facts that were not accessible to the

Plaintiffs regarding their nefarious scheme to induce the Plaintiffs to permit their

mortgages to go into default in the hope of obtaining loan modification.

2936. At all times relevant, Defendants had an affirmative duty to disclose to the

Plaintiffs that Defendants had no legal authority to offer loan modifications.

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2937. However, the Defendants have hidden and suppressed the fact that they do not

own the subject promissory notes and hence have no legal or contractual authority to

offer such loan modifications.

2938. The Defendants also had an affirmative duty to disclose to the Plaintiffs that

Plaintiffs did not have to be in default on their loans in order to qualify for loan

modifications.

2939. Defendants have induced the Plaintiffs into allowing their loans to go into default

by telling Plaintiffs it was a requirement for becoming eligible for a loan modification

2940. In truth, under applicable law in effect since 2009, a borrower is not required to

be delinquent and/or in default with his loan in order to be eligible for a loan

modification.

2941. Defendants have only claimed that borrowers must be in default, in violation of

law, because Defendants can realize more profit and commit more acts of conversion

when a borrower is actually in default, i.e., at least 90 days behind in his loan

payment

2942. After Defendants profited by their deceit and concealment, they then continued

demanding and collecting monies from Plaintiffs, constituting outright conversion.

2943. The fact that these Plaintiffs did not need to be delinquent on their loans and/or in

default in order to qualify for loan modifications has been hidden and suppressed

from these Plaintiffs by Defendants and continues to be hidden.

2944. The Defendants should have disclosed these suppressed facts to the Plaintiffs

because they were material to the cost-benefit analysis that should have and could

have been undertaken by each Plaintiff.

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2945. Had the true facts been disclosed to the Plaintiffs, knowledge of those material

facts likely have caused each Plaintiff (a) to act differently than he or she did while

not knowing the facts hidden from him by Defendants, and (b) to protect himself or

herself by not preventing his or her funds from being converted by Defendants.

2946. The Defendants knew these suppressed facts and further knew at the time of their

suppression, that such suppression and concealment would cause each Plaintiff to act

in a way that was injurious to him or her while at the same time being profitable to

Defendants.

2947. When suppressing and concealing from the Plaintiffs these material facts as

herein alleged, Defendants intended to induce each such Plaintiff to alter his or her

position to his or her harm.

2948. Each Plaintiff justifiably and reasonably relied on the fraudulent concealment

created by these Defendants in their suppression and concealment of the material

facts described above.

2949. Once a Plaintiff became delinquent in his or her loan payments, Defendants then

acted to ensure that the delinquency became a default under the terms of the loan

documents.

2950. Defendants achieved this by asking each Plaintiff applying for a loan modification

to submit the proper application and paperwork. Once a Plaintiff submitted all

documents as requested, the Defendants then claimed to have “lost” the Plaintiff’s

application package, necessitating the re-submission of such documents by each

Plaintiff hoping to qualify for a loan modification.

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2951. During this process, Defendants would collect and convert the maximum amount

of money from Plaintiffs in sums according to proof.

2952. This process of “losing the paperwork” and requiring re-submission thereof

necessarily ensured that a Plaintiff’s one or two-month “delinquency” automatically

became a “default,” and an event requiring significant payments to Defendants to

cure said “default,” all of which constituted misappropriation and conversion of funds

under law.

2953. These Defendants regularly dragged out this process for months and months when

dealing with Plaintiffs in need of loan modifications. They did so by claiming over

and over again to have “lost” the paperwork of the borrower involved.

2954. Each Plaintiff was directly and proximately harmed by Defendants’ fraudulent

concealment of facts described herein.

2955. Plaintiffs have incurred additional costs and charges and late fees as a result of

being told that they needed to be delinquent in their loans in order to obtain a loan

modification.

2956. Plaintiffs have gone into default and even lost their homes through foreclosure as

the result of the same fraudulent concealment by Defendants.

2957. Further, Plaintiffs have had their credit profiles destroyed by allowing their loans

to go into default as instructed by Defendants.

2958. Accordingly, each Plaintiff is entitled to general and special damages according to

proof at trial.

2959. Further, the Defendants acted outrageously and persistently with actual malice in

suppressing the facts and circumstances set forth, and they continue to do so.

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Accordingly, the Plaintiffs are entitled to exemplary and punitive damages in a sum

according to proof.

2960. The Defendants willfully committed the wrongdoing against each Plaintiff as

described herein and knowingly chose to deceive him in the above-described manner.

Thus, the acts of the Defendants were malicious and performed with a callous

disregard for Plaintiffs’ legal rights. Plaintiffs are therefore entitled to punitive

damages. Plaintiffs are further entitled to attorney fees under whatever contract or

statute applies.

2961. Inclusive of all compensatory damages, special damages, attorney fees and

punitive damages alleged herein, no Plaintiff has sustained damage in a sum greater

than $75,000.00.

SIXTH CLAIM FOR RELIEF

Fraudulent Concealment

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2962. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

2963. As set forth in the Fifth Cause of Action, the Defendants used fraud and artifice to

lure borrowers into defaulting upon their mortgages by promising them loan

modifications when they had no intention of providing such loan modifications.

2964. Once the Defendants lured a borrower into default, then the Defendants collected

upon “credit default swaps” (“CDS’s”).

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2965. CDS’s were and are used to insure mortgage-backed securities, and investor

trading in these two instruments was the central cause of the mortgage meltdown that

occurred in this country.

2966. A CDS is a form of insurance that is actually a bet against the subject loan being

paid on time as agreed. CDS’s ensure that Defendants can collect on every loan that

goes bad by going into default.

2967. If a borrower defaulted upon a mortgage that was pooled into an MBS, the buyer

of the CDS makes a series of payments (the CDS "fee" or "spread") to the seller and,

in exchange, receives a payoff if the loan defaults. Thus, the original lender was paid

when it sold the promissory note executed by the borrower, and the MBS pool was

also paid in full by virtue of the CDS payments received.

2968. This, then, constitutes the number one reason that the Defendants wanted each

Plaintiff to actually default on his or her loan: The Defendants bet against each

Plaintiff by buying CDS’s on every loan they allegedly service, and then trying to get

that loan into default so that the Defendants can collect on this “side bet.”

2969. The fact that the Defendants were motivated to see that each Plaintiff failed to pay

their mortgages on time and thus ended up in default so that the Defendants could

collect on their CDS side bet has been hidden and suppressed from Plaintiffs by the

Defendants.

2970. The suppressed facts and circumstances described herein should have been

disclosed to the Plaintiffs by the Defendants because such facts and circumstances

were material in that they were essential to the analysis that should and could have

been undertaken by each Plaintiff in determining whether to enter into a loan

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transaction with the Defendants, and would likely have caused each Plaintiff to act

differently than he did while not knowing the facts hidden from him by Defendants.

2971. These suppressed facts and circumstances were known to the Defendants at the

time they were hidden from Plaintiffs.

2972. Further, the Defendants knew at the time of suppression and concealment that

such suppression and concealment would cause each Plaintiff to act in a way that was

injurious to him while at the same time being profitable to the Defendants.

2973. When suppressing and concealing from these Plaintiffs the facts and

circumstances herein described, the Defendants intended to induce each Plaintiff to

alter his position to his harm.

2974. Each Plaintiff justifiably and reasonably relied on the fraudulent concealment

created by Defendants in their suppression of the facts and circumstances described in

this Cause of Action.

2975. Defendants’ receipt of money from CDS’s coupled with their later receipt of

money from Plaintiffs means that the Defendants have received a windfall in the form

of gaining either ownership of the real property of borrowers, or the value of that real

property, and is malicious, outrageous, and entitles Plaintiffs to recover exemplary

and punitive damages in a sum according to proof.

2976. The Defendants knowingly and willfully committed the wrongdoing against each

Plaintiff as described herein and knowingly chose to deceive him in the abovedescribed

manner. Thus, the acts of the Defendants were malicious and performed

with a callous disregard for Plaintiffs’ legal rights. Plaintiffs are therefore entitled to

punitive damages. Plaintiffs are further entitled to attorney fees.

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2977. Inclusive of all compensatory damages, special damages, attorney fees and

punitive damages alleged herein, no Plaintiff has sustained damage in a sum greater

than $75,000.00.

SEVENTH CLAIM FOR RELIEF

Promissory Estoppel

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2978. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

2979. Each Plaintiff herein attempted to take steps to save his or her house once it

became apparent that Defendants intended to foreclose against them. Some Plaintiffs

considered filing bankruptcy as a valid and viable means to save their homes. Other

Plaintiffs investigated other possible ways to avoid losing possession of their homes

due to Defendants’ wrongful tactics as set forth above.

2980. In each instance, Defendants promised to Plaintiffs that there was no need to file

bankruptcy or pursue other ways to avoid foreclosure because Defendants would

forego the foreclosure process and would instead “work with” each Plaintiff to

modify the terms of the home loan in question, thereby making it possible for each

Plaintiff to make the necessary monthly payments.

2981. In reliance on the promises made by Defendants not to foreclose and to instead

“work with” each Plaintiff, each Plaintiff reasonably decided not to file for

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bankruptcy or to investigate other possible scenarios to stave off impending

foreclosure.

2982. Instead of cooperating with each Plaintiff and working with them to modify each

loan at issue, Defendants instead have proceeded with various levels of conversion

and/or foreclosure proceedings against each Plaintiff herein.

2983. In reasonable reliance on Defendants’ promises not to foreclose, each Plaintiff has

suffered direct and proximate damages as a result of Defendants’ bad-faith breach of

promises not to exceed $75,000.00. Each Plaintiff is therefore entitled to

compensatory damages according to proof within these limitations, in order to make

him or her whole.

EIGHTH CLAIM FOR RELIEF

Negligent Misrepresentation

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2984. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

2985. Because the Plaintiffs relied upon the Defendants to guide them through the

process of making and later servicing their home mortgage loans, a special

relationship exists between the Plaintiffs and the Defendants.

2986. The existence of that special relationship imposed upon the Defendants a duty to

fully and accurately disclose all pertinent information pertaining to those home loans

to the Plaintiffs, including, but not limited to, true and correct information pertaining

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to the securitization of their notes, the existence of CDS, and the fact that the

Defendant lenders had no legal right to foreclose upon their mortgages once the

promissory notes became the basis for MBS pools.

2987. Defendants failed to disclose this material information to the Defendants, or

omitted critical elements from the disclosures that were made.

2988. The Plaintiffs reasonably relied upon the material misrepresentations of the

Defendants to their detriment in choosing to proceed with their mortgage loan

transactions.

2989. As a consequence of the negligent misrepresentations made by the Defendant to

the Plaintiffs, no Plaintiff herein has suffered damages greater than $75,000.00.

2990. Plaintiffs allege that each of the wrongful acts or omissions described in this

Cause of Action was either performed by each Defendant herein, named or unnamed,

or ratified and adopted by each Defendant after its occurrence. Further, those

Defendants that did not actively perform the acts or omissions described here did

affirmatively aid and abet the other Defendants in the performance of such acts or

omissions, before, during or after the fact.

2991. Finally, each Defendant herein, named or unnamed, did knowingly derive some

form of profit or benefit from the acts and omissions described herein. All Defendants

agreed to work together in the conspiracy and/or joint enterprise described in this

paragraph as that conspiracy is alleged above. Accordingly, each Defendant, named

or unnamed, should be held liable for the acts and omissions complained of.

NINTH CLAIM FOR RELIEF

Breach of the Covenant of Good Faith and Fair Dealing

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(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

2992. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

2993. In each and every mortgage note signed by the Plaintiffs, and in each and every

mortgage instrument signed by the Plaintiffs in favor of the Defendants, is implied a

covenant of good faith and fair dealing between the parties.

2994. The implied obligation encompasses any promises which a reasonable person in

Plaintiffs' position would be justified in understanding was included in the parties'

agreement.

2995. The Defendants have breached that covenant of good faith and fair dealing by

intentionally and/or negligently misrepresenting or omitting to disclose material facts

that would have been pertinent to those Plaintiffs’ decisions to enter into transactions

with the Defendants.

2996. As a consequence of the breaches of the covenant of good faith and fair dealing

by the Defendants, the Plaintiffs have been deprived of the right to receive the

benefits under those loan agreements, to-wit: they have been stripped of the value and

equity in their homes as a consequence.

2997. Inclusive of all recoverable damages and restitution and costs and attorney fees,

each Plaintiff has sustained damage and restitution in the sum of no more than

$75,000.00.

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2998. Plaintiffs allege that each of the wrongful acts or omissions described in this

Cause of Action was either performed by each Defendant herein, named or unnamed,

or ratified and adopted by each Defendant after its occurrence. Further, those

Defendants that did not actively perform the acts or omissions described here did

affirmatively aid and abet the other Defendants in the performance of such acts or

omissions, before, during or after the fact.

2999. Finally, each Defendant herein, named or unnamed, did knowingly derive some

form of profit or benefit from the acts and omissions described herein. All

Defendants agreed to work together in the conspiracy and/or joint enterprise

described in this paragraph in the manner set forth herein. Accordingly, each

Defendant, named or unnamed, should be held liable for the acts and omissions

complained of.

TENTH CLAIM FOR RELIEF

Unjust Enrichment

(By Plaintiffs 1-310 and 838 against all Defendants; and by Plaintiffs 311-352, 354-673

against all Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6;

and by Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733

against all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except

16, 17)

3000. All of the above Paragraphs of this Complaint are hereby incorporated by

reference as though fully set forth herein.

3001. Through their conduct as described herein, all Defendants herein were unjustly

enriched at the expense of each Plaintiff and by taking his or her money under false

pretenses and by ultimately foreclosing or attempting to foreclose upon the homes of

the Plaintiffs without legal authority to do so.

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3002. To permit the Defendants to retain their unjust gains would be against equity and

good conscience, and would ratify the illegal actions taken by the Defendant to the

detriment of the Plaintiffs.

3003. Here, in order to avoid the unjust enrichment of the Defendants, each Defendant

should be ordered to pay back to each Plaintiff any and all monies unjustly received

from him or her. All inclusive, no Plaintiff herein has suffered damages greater than

$75,000.00.

3004. Plaintiffs allege that each of the wrongful acts or omissions described above was

performed by each Defendant herein, named or unnamed, or was ratified and adopted

by each Defendant after its occurrence. Further, those Defendants that did not actively

perform the acts or omissions described here did affirmatively aid and abet the other

Defendants in the performance of such acts of omissions, before, during or after the

fact.

3005. Finally, each Defendant herein, named or unnamed, did knowingly derive some

form of profit or benefit from the acts and omissions described herein. All Defendants

agreed to work together in the conspiracy and/or joint enterprise described in this

paragraph in the manner set forth above. Accordingly, each Defendant, named or

unnamed, should be held liable for the acts and omissions complained of.

ELEVENTH CLAIM FOR RELIEF

Violations of N.Y. Gen. Bus. Law §349

(By Plaintiffs 1-310 against all Defendants; and by Plaintiffs 311-352, 354-673 against all

Defendants except 1-4; and by Plaintiff 353 against all Defendants except 1-6; and by

Plaintiffs 674-732, 734-803 against all Defendants except 5, 6; and by Plaintiffs 733 against

all Defendants except 1-6; and by Plaintiffs 804-837 against all Defendants except 16, 17;

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and by Plaintiff 838 against all Defendants except 5)

3006. The allegations in the foregoing paragraphs are repeated and realleged as if fully

set forth herein.

3007. Defendants, and each of them, have operated and continue to operate the largest

Ponzi scheme in world history with a plan that – at its inception – was intended to,

did in fact and continues to the present day to have as its object the theft and

conversion of billions of dollars from millions of homeowners, including Plaintiffs.

3008. Defendants’ wrongful acts include (but are not limited to) the following: (i)