Consumer complaint received 2021-01-26 00:00:00
Product: Debt collection — Mortgage debt
Issue: Attempts to collect debt not owed — Debt was result of identity theft
Company: PENNYMAC LOAN SERVICES, LLC.
State: MI

Complaint narrative:
Dear CFPB, Please find my complaint against PennyMac Loan Servicing, XXXX XXXX XXXX XXXX XXXX., XXXX  XXXX XXXX ; XXXX, XXXX XXXX, XXXX  XXXX XXXX and other hidden behind the scheme con artists like XXXX XXXX, XXXX XXXX, XXXX, eat who massively defraud home buyers, other borrowers and investors from trillions of dollars under their fraudulent scheme called securitization XXXX XXXX XXXX created a myth called securitization where they do not securitize ANYTHING except borrowers DATA akaidentity theft not backed by any assets. Nobody sell any loans or any parts of loans. Nobody lend any money to homebuyers. 

Money for closing and all other lending are coming from Investors who lend to XXXX XXXX XXXX  via short term credit used by XXXX XXXX XXXX  to fund ALL loans via fictitious parties who call themselves Lenders  - These money are not related by ANY homeowners transaction in in fact related to sales of securities backed by borrowers identities to other investors. Thus, the original creditors are investors who lent money to XXXX XXXX XXXX  and who receive their advances after securities backed by borrowers data are sold to another groups of investors in form of bets. 

So, when PennyMac say they purchased my loan they lied to defraud me an authorities, which is proven many times. Nobody sold any mortgages to PennyMac who was transformed by XXXX XXXX into a biggest lender and servicer via PR coup. PennyMac an XXXX ( former XXXX XXXX XXXX NEVER funded any loans and NEVER serviced them. XXXX is receiving a fee for acting as a Trustee for non-existing Trusts who also nee er had any relationship to anyones mortgages. Nobody confirmed they sold my loan to PennyMac.XXXX  always claims that my complaints do not belong to them - while PennyMac lies that they give my mortgage payments to Trustees who distribute them to investors. LIR, LIE, LIE. 

But since this lie is promoted by the Government ( resent sale of XXXX  bonds to Federal Reserve is just another scam to defraud homeowners and investors ) PennyMac feels completely confident that the Government will cover for XXXX XXXX crimes, like they did in XXXX with fake Cease and Desist orders and bogus Settlement. 

Most homeowners, including myself, sign documents at closing because they believe their intentions are properly presented in those documents.We were all wrong. We were not borrowing any money from fake XXXX. We CREATED money for XXXX XXXX XXXX  when we submitted an application which was used as a back up for lines of credits from investors or from Federal Reserve. After than we were not dealing with repayment of any debt since it did not exist from the beginning ( the initial investors were paid after XXXX XXXX sold certificates to another group of investors ) thus we were dealing with a concealed scheme by XXXX XXXX Stockbrokers which is in part a direct fraud on homebuyers ; in part giant Ponzi Scheme ; gigantic Bucket Shop on investors and other illegal practice. 

Stockbrokers do not have an interest other than a profit from the sale of securities. These brokers on XXXX XXXX have tried to pull the wool over the eyes of regulators and investors so that they still appear to be XXXX when in fact they are the only principal. 

All XXXX XXXX XXXX XXXX debt buyers are merely a part of this giant mystification. The result has always been, without exception, catastrophic for everyone except the brokers who use a common theme : You cant punish us with producing apocalyptic results for finance, and your society. As a society, we are still buying into that threat. It isnt true and never was true. And so it goes. 

XXXX XXXX lawyers are drafting prospectuses and agreements for Initial Public Offerings, with the guiding principles to bury anything negative under an avalanche of words. And because nobody wants to admit they did anything XXXX or foolish, investors tend to think and insist they knew what they were doing. And that is the essence of successful con jobs. The con only works if the mark ( i.e., XXXX ) adopts it as their own. People con themselves. Take XXXX XXXX XXXX for example, successfully sold XXXX XXXX and XXXX XXXX. XXXX used various names as a con man, including XXXX XXXX XXXX, XXXX XXXX, Mr. XXXX and Mr. XXXX. Compare XXXX XXXX banks tactics to use various names of XXXX, PennyMac and other actors-f0r-hire to pose as lenders and Servicers. 
XXXX had multiple methods for making his sales. When he sold XXXX  XXXX, he would often pose as the generals grandson, and he set up a fake office to handle his real estate swindles. He produced convincing forged documents as evidence to suggest that he was the legal owner of whatever property he was selling. 

Like the mortgage meltdown ( which continues through the writing of this Complant ), in many cases, XXXX targeted people fresh off the boat who understood little English or American Culture. So they relied upon what he told them and then they imagined the rest. Some people were forced off the XXXX XXXX when they started erecting toll booths, as the new owners. 

In every con job the paperwork generally has the look and feel of real documents and says, in the beginning, what people expect it to say. They are conning themselves. And the perpetrators will often point to the content of what was signed by the layman as providing that the very thing that punished the consumer was disclosed in some fine print wording buried deep within all of the documents that were signed. 

For example, a loan in XXXX would always refer to the loan and would recite that the Lender was XXXX who was giving a loan of money to the borrower who was a borrower, receipt of which loan was acknowledged. That is and was the basic language for any loan for centuries until around XXXX. 

That is when the reference to a loan was dropped and the documents signed by the homeowners started to change merely referred to the execution of a note and the execution and recording of a mortgage. The loan was implied because what else could it be? The success of this sleight of hand is well-known. Trillions of dollars poured through the hands of securities brokers who prospered during the worst crash since the Great Depression plus receiving trillions of dollars in bailouts and bond purchases. Everything else was reduced to rubble. 

The expectation of the homeowner, including myself, was that he/she was a borrower in a loan transaction. I thought that the application for a loan was submitted to a lender and was underwritten by someone with a risk of loss i.e. a stake in the success of the transaction as a loan. I had a reasonable belief that as a loan transaction the party receiving the loan application and the party underwriting the transaction were both governed by Federal and State lending laws. As such, the responsibility for the viability of the loan, accuracy of the loan appraisal, and risk of loss was squarely on the lender. 

XXXX XXXX XXXX  did what they do the separated out functions so that only the part that looked like a loan was shown to the homeowner. For the most part, applications for loans were submitted through intermediaries who presented themselves as loan brokers and sometimes misrepresented themselves as lenders ( simply because they had a license to act as a lender ). In some cases, the parties accepting the applications did not legally exist. They were just names but that did not matter to XXXX XXXX brokers because they were not really making loans. 

The underwriters were aggregators of data providing a service ( e.g. XXXX, now XXXX who was the one who actually processed my application under glimpse of XXXX XXXX  XXXX XXXX ) ) i.e. laundering data to make it look like a pool of loans was being created for tranches ( layers ) of fictitious entities. This service was provided to the brokers through entities totally under the control of the brokers for purposes of their real business selling securities to investors. ( Does anyone really think that XXXX XXXX banks ever had any interest in lending money? ) The aggregators arranged the data in reports that gave information on thousands of transactions. They never said they were loans and they never said they owned them. But that is what everyone assumes. We are conning ourselves because we cant imagine what else it could be. 

The XXXX XXXX stock brokerage firm calling itself an investment bank borrows {$1.00} XXXX on short-term credit for example using expected sales of securities as collateral. Thus these money are generated by borrowerss intent to borrow money used by XXXX XXXX XXXX as collateral. The broker then sells the securities to investors and repays the loans. In the interim, the money from the loan is used to fund, on average, around {$700.00} XXXX in transactions with homeowners. Bear to repeat, these money have XXXX to do with anyones mortgage. 

The other {$300.00} XXXX is concealed trading profit. These fictitious profits occur when the broker shows a sale ( only on its own books ) of {$700.00} XXXX face value of notes for {$1.00} XXXX. That false sale occurs between a depositor who does not own the debt, note, or security agreement and a trust that legally does not exist because it has nothing in trust that was entrusted to the named trustee. the trustee has no right, title or interest in the transactions, nor any right or obligation to seek or receive any information about the nonexistent contents of thetrust or any activities undertaken in the name of the trust. ( In other words, it is not a trustee ). XXXX merely lies to homeowners, Judges and investors about its role as Trustee All entities are owned or controlled 100 % by the broker. This is the holy grail of investment banking. Selling securities without being required to turn the proceeds of the sale ( money ) over to any issuing entity because in substance the issuing entity is the broker. The extra {$300.00} XXXX trading profit is usually performed in a transaction that is both offshore and off-balance sheet so there is no report of it until the broker wants to show an increase in profits to bolster the apparent value of its own common stock trading in the marketplace. 

Recent reports from the big banks that are in reality failing, indicate significant trading profits that are simply repatriating the money they stole from investors. The most notorious lie is XXXX  XXXX XXXX organic growth when they repurchase its own bonds from investors - in fact investors demanded their money back due to XXXX fraud - bit this information is carefully concealed from the public, specially homeowners who XXXX is prepared to rob though the Court for additional profits. 

Investors were never told all of their money would be used for the origination or acquisition of loans. They just assumed it despite concealed language in the prospectus that did not quite promise anything other than a potential, discretionary revenue stream from the broker that was often disclosed as unsecured and expressly unrelated to any obligation owed by any homeowner. Investors made this assumption because after all the brokerage firm was a broker, not a principal. They were conning themselves. Investors were NOT beneficiaries of any trust, real or imagined but they thought they were because they assumed they were. 

It was later when investors ( e.g. pension funds ) discovered that the broker had no interest in underwriting loans, no interest or intent of having a risk of loss or no intent for complying with any lending statutes, rules, or even custom and practice in the lending industry ; investors were rudely awakened to the fact that they had no legal interest in enforcing anything against anyone. They had, as in every con, conned themselves with an assist from the con men XXXX XXXX brokers. 

Investors were left with a Security that was virtually worthless because it was discretionary, unsecured, and based upon reports that the payor ( broker ) could issue in its sole discretion. But if they admitted all of that, they would be required to show the loss of value of the certificates ( securities ) that they had purchased which would result in devaluing the entire pension fund, which in turn would probably lead to dismissal of the fund manager. 

So they sued the depositors or sellers for bad underwriting even though there was virtually no underwriting involved. The more savvy investors with more savvy lawyers received larger settlements without ever saying the whole thing as a scam because they were being paid to keep silent about the true nature of this scheme. The smaller, more unsophisticated investors with lawyers who were not well versed in investment banking and securities brokerage received as little as XXXX cents for each dollar they invested. That is what caused small banks to fail. They were trapped by the con. They too had been investors seeking a higher return. 

The truth is that most pension funds are over-reporting the value of their assets. That means that at some time in the future, the ability to fulfill pension payments will be correspondingly reduced. Only by that time, it is highly likely that nobody will make the connection to securitization debt that never occurred. Even worse, the beneficiaries of pension funds and other stable managed funds still wont realize that if they are faced with foreclosure, and they all away, they are not just giving up the largest investment of their life ; they are also undermining the value of the fund that feeds them. 

In the XXXX loan, the Lender had an entry on its ledger that was a reduction of cash to pay for the loan. In double-entry bookkeeping, this was followed by an increase in loan receivables by the exact same amount. And that is how the loan account receivable is created. It serves as the legal basis for asserting the existence of the loan and the account history for debits and credits throughout the life of the loan. 

After XXXX no such account was ever created. If those ledger entries had been made, then the brokers would have actually securitized loans by selling off pieces of each loan to multiple investors. But that would have limited the brokers to selling the loans only once. If they sold loans more than once it would have been a fraudulent scheme bearing criminal accountability. So they didnt sell them and that means they didnt securitize homeowner transactions, which were not loans in the first place. 

The brokers paid homeowners money. That much is generally true ( although questionable in refis ). But the brokers wanted no part of losing money if the homeowner failed or refused to make a scheduled payment. They had no risk of loss. They had no loan account. But by concealing the true nature of the business scheme i.e. the creation, issuance, sale, and trading of securities and using the homeowners knowledge against him/her, they convinced everyone that the execution of the promissory note was one exchange for the nonexistent loan. The securities were based upon the illusion of a loan transaction but certainly not the reality of a loan transaction. 

Adding insult to injury then, the homeowner having played a crucial role in the illusion of a loan is then tricked into giving back the only reason why he/she entered the transaction in the first place the receipt of money. 

In short, that is a return of the only consideration for involuntary participation in a securities scheme about which the homeowner knew absolutely nothing. Worse yet, the homeowner believed it was a loan and so agreed to pay interest and fees on top of returning the only consideration for the deal. This left the homeowner with negative consideration for the deal, plus concealed risks in the form of unmarketable loans, inflated appraisals, and the complete inability to reach anyone with ownership or authority of the transaction to work out arrangements that were necessary to correct the situation. 

With no loan account that could be presented without committing perjury and fraud, the brokers hit upon the scheme of using still more intermediaries who were called servicers. The servicers did virtually nothing. All receipts are collected via third-party vendors who are completely controlled by the brokers. The servicers are hired to interface with homeowners, reassure them that their loan is under management, and present a payment history about which they know nothing because they never collected a dime from the homeowner. 

Servicers are always thinly capitalized entities that can be thrown under the bus for accounting or servicing or collection irregularities. They hire employees or contract employees who know less than the servicer. These people are presented as witnesses in foreclosure proceedings. Such people are the only witnesses at trial in foreclosure cases. Theyre not legally competent and travel along a very thin line between deception and perjury. 

The payment history is actually printout from a data record prepared for enforcement only by third-party vendors who process payments from homeowners. 

Those payments are scheduled, but not due since they are paying off a loan account that does not exist. You will never find any payment history that purports to be the ledger of any creditor i.e., the party who is named as claimant, beneficiary, or plaintiff in foreclosure. That is because no such ledger exists. 


This was 20 years ago when the Federal Reserve skipped regulation in the mistaken belief that market forces would make any needed corrections. XXXX XXXX who was head of the Fed has admitted that was a mistake. It is now up to homeowners and their attorneys to fight these foreclosures at every turn and win. This task will be made far easier if changes in the administration in Washington DC result in an acknowledgment of the obvious facts : the money paid to homeowners was not a loan. It was compensation for involuntary participation in a business scheme. Market forces dictated the amount of that payment. Brokers have no right to recover it. 

Investors and homeowners are in the same boat. the intention of both was a lending transaction. Neither one of them got what they intended. Current brokers and servicers should be forced out of the picture and regulators should stop pretending that REMICs exist or that the securities issued were unregulated mortgage-backed bonds or certificates. They were never mortgage-backed. There were no mortgage loans. Those mortgages secured a promissory note that was issued without the homeowner receiving consideration. 
The only deal that was completed was the business scheme of creation, issuance, selling, and trading securities. Homeowners were already paid for that. Nobody was ever legally entitled to seek or receive payments that returned that compensation. If that compensation is too high, then let the brokers come to court and file a reformation action. 

I again demand to provide me the name of the SELLER of my loan to PennyMac ; a PROOF pot payment of value by PennyMac ; the name of the Company who hired PennyMac as a Servicer and whom they servicing. XXXX  number for Trust th purportedly servicing ; Pay me 20 % royalties from all traded and compensation for all damages, including emotional distress. 

Total {$50.00} XXXX in damages, or more

Company response to consumer: Closed with explanation