Consumer complaint received 2024-12-15 00:00:00
Product: Debt collection — Mortgage debt
Issue: Took or threatened to take negative or legal action — Threatened or suggested your credit would be damaged
Company: PENNYMAC LOAN SERVICES, LLC.
State: GA

Complaint narrative:
PennyMac Loan Services , LLC Subject : **Dispute of Foreclosure Threat and Violation of Securities Fraud** Violation of SEC ACT OF 1934 SECURITIES FRAUD, VIOLATION OF INDENTURE TRUSTEE ACT AND EFT ACT I am writing to formally dispute the actions and threats of foreclosure associated with the above-referenced loan. I assert that you are in violation of the **Securities Exchange Act of 1934**, **Uniform Commercial Code ( UCC ) **, and the **Indenture Trustee Act**. Additionally, your actions may constitute **securities fraud**, as I am the sole owner of the property in question as both the assignor, assignee, mortgagor, and holder of the promissory note. Furthermore, I contend that the actions of your institution, including threats of foreclosure, are not legally supported by a valid lien or judgment as required under the law.

**Legal Violations and Claims : ** 1. **Securities Fraud under the Securities Exchange Act of 1934** : According to the **Securities Exchange Act of 1934**, securities fraud occurs when false or misleading representations are made in relation to the sale or transfer of securities. As the original holder and sole owner of the property in question, I dispute any claims that PennyMac Loan Services has a valid lien or ownership over my property. No lien has been recorded in the **UCC-11 system**, and under **UCC law**, any property not listed in the system has no established lien over it. Therefore, any attempt by your institution to claim ownership or threaten foreclosure on the grounds of an invalid or unrecorded lien is a clear violation of the law and constitutes securities fraud.

2. **Lack of Valid Lien** : As the holder of the promissory note and the sole owner of the property, I assert that **no lien** has been filed with the **UCC-11 system**. According to **UCC 9-312** and related statutes, a lien can only be perfected and enforceable if it is properly filed and recorded. Since there is no such lien, PennyMac Loan Services has no legal right to take any action against the property, including the initiation of foreclosure proceedings.

3. **Foreclosure Can not Be Reported or Threatened Without a Judgment** : As per established case law, foreclosure proceedings can not be initiated or threatened without a valid judgment. This principle is supported by several rulings, including **XXXX XXXX  XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX ( XXXX XXXX XXXX ), which held that foreclosure threats must be based on a court judgment and not merely on the assertion of an unsubstantiated debt. Moreover, the **Fair Debt Collection Practices Act ( FDCPA ) **, specifically **15 U.S.C. 1692e ( 5 ) **, prohibits any representation or threat to take actions that can not legally be taken, such as foreclosure without a valid judgment.

4. **Indenture Trustee Act Breach of Fiduciary Duty** : Under the **Indenture Trustee Act**, the trustee for any debt-servicing institution, including PennyMac Loan Services, has a fiduciary duty to act in the best interests of the borrower and to discharge all debts appropriately. By threatening foreclosure without the appropriate legal documentation, PennyMac Loan Services and their trustee have abandoned their fiduciary duty to ensure that the debt is properly managed and discharged.

5. **Fraudulent Banking Practices** : It is well-established under **12 U.S.C. 83** that banks are prohibited from lending money that does not actually exist, and it is illegal to record a deposit from the borrower as a loan extension, only to return the funds to the borrower under the guise of a loan. This practice is fraud, as it misrepresents the transaction and constitutes a false statement of credit extension. 

**Request for remedy** Given the legal violations outlined above, I am requesting the following actions from PennyMac Loan Services : 1. **Immediate Cease of All Foreclosure Threats** : PennyMac Loan Services must immediately stop any actions or threats related to foreclosure on the property until proper documentation of a valid lien is provided, or until a court judgment is entered in support of the claim.

2. **Removal of Any Foreclosure-Related Information from My Credit Report** : Any foreclosure-related information should be immediately removed from my credit report, as no legal basis for such actions exists.

3. **Provide Proof of Lien and Validity of Debt** : PennyMac Loan Services must provide proof of a recorded lien in the **UCC-11 system** and demonstrate that the debt is legally valid, and not subject to securities fraud or improper lending practices.

4. **Cease Harassment and Debt Collection Activities** : Any further attempts to collect this debt or harass me for payment must cease immediately until these matters are resolved in accordance with the law. 

**Conclusion** : I trust that PennyMac Loan Services will take immediate steps to address these serious legal issues. If this dispute is not resolved within 30 days, I will take further action, including filing complaints with the **Consumer Financial Protection Bureau ( CFPB ) **, the **Federal Trade Commission ( FTC ) **, and seek legal recourse through the appropriate state and federal courts. 

I look forward to your prompt response and a resolution to this matter.

Company response to consumer: Closed with explanation