Walls

I just read that a group out of the University of Texas recently petitioned the Organizatin of American States to condemn the wall between the U.S. and Mexico. It of course has already been condemned by Mexico and most of Latin America. While the wall can’t help but deter immigration, it’s overall utility is debatable. No one believes that the petition to the OAS will affect the building of the wall. Human rights considerations, and international law and opinion have not played a significant role in determining U.S. policy recently.

Our wall is to be 2000 miles long, as long as the low estimates of the length of the Great Wall of China. (Some estimate the other wall to be three times this length.)

Whatever your position is with respect to the wall, people agree that it is certainly symbolic of our era. It is a metaphor, a symbol, which for many replaces the Statue of Liberty. The welcoming beacon of freedom is replaced in the minds of many people with the blank expanse of the wall, like an extended palm signaling “halt.” For many people outside the United States our country is seen, not as a sanctuary, and champion, for the oppressed, but as a garrison, walled like a Medieval city-state.

Looking back, Bill Clinton’s euphoric descriptions of globalization (one of his favorite terms) seem naive and distant. The purpose of bridging cultures and identifying common interest has been replaced by phrases like “If you are not for us, you are against us,” “bring ‘em on,” “we are on a crusade,” and the like. We have turned a blind eye to international opinion, like the balnk stare of the wall.

We have not just invested in walling our country, but in creating a honeycomb of walls within it. Political forces have converted the world’s melting pot into a fragmented society in which cultural identity is preserved in part for defensive purposes. We are becoming a society of gated communities which look out at others with distrust and fear.

Our government has a growing list of citizens identified a suspected terrorists. The number of people on the list has apparently passed one million. That’s about 5 for each thousand adults. If you go to BellSquare on a busy day, there should be maybe ten or twenty “suspected terrorists” among your fellow shoppers. We have built walls around airports, public buildings and public gathering places, access permitted by guards only after inspection.

These walls of course are not just metaphorical. We have by far the biggest prison population in the world. More people are in prison than there are in Phoenix, Arizona. A staggering number of our fellow citizens have been through the criminal justice system in one way or another.  Prison construction and management has been privatized to a large degree and has become a booming industry. It could become a college major in some schools like hotel and motel management.

These are the costs of security, as we see it. The cry of “security!” seems to be in the ascendancy. It’s good though to keep it in context.

Merit System in Washington Chopped Off

As you know, if you’ve been reading this a while, there was a bill last session of Washington’s legislature to adopt the merit system for the selection of judges to the Court of Appeals and the State Supreme Court. This is the system advocated diligently by Sandra Day O’Connor to eliminate the influence of deep pockets on judges’ decisions and to assure that the most qualified people are appointed to the bench.

The bill was sponsored by Jay Rodue, a Republican from the 5th District, Sherry Appleton, a Democrat from the 23rd District, Helen Sommers, from the 36th District. Here is a copy of the final form of the bill. The house report explained generally how it would work.

The bill made it to Frank Chopp’s Rules Committee, a death chamber for bills that do not advance the interests of the most powerful lobbies. He predictably killed the bill.

The people who sponsored the bill deserve accolades for wanting to improve our judicial system for the sake of the people here and not any special interest. The members of the House Rules Committee are listed here.

Our legislators need to know that we care about having the best court system that we can muster. I’ll write more when the legislature is in session.

FISA, Immunity, Pardons, and Luthor Collins

The recent discussions about immunity in the context of the FISA bill have stirred up a great deal of frustration among people who have been shocked or disapproving of the Bush administration’s apparent cavalier attitude to complying with the law. This resentment no doubt provides some of the fuel for the populist movement that seems to be carrying Obama along. Both Republicans and Democrats have expressed to me frustration that there is not even any meaningful investigation of the charges. The administration does not have immunity but it does seem to operate with impunity.

Part of the public’s outrage about FISA relates to the appearance of hypocrisy. The same law-and-order people who advocate strong criminal sentencing standards advocate immunity for the corporate officials whose conduct apparently involved violation of constitutional rights on a massive scale. The sense of hypocrisy is heightened by the color and class distinctions between the criminal justice defendants and the corporate miscreants.

This frustration is very deep and involves what appears to be a failure of our system of checks and balances. The Republican Congress during the first six years of the Bush administration is widely seen as having allegiance to party over country or over the citizens of the country. During this time effort seemed to be directed to covering up the regularly occurring scandals. The two years of Democratic control of Congress have not been signifiantly different in terms of rendering people in the executive branch accountable for their transgressions. The FISA bill in granting immunity for illegal domestic surveillance was profoundly disillusioning for many. It went beyond disregarding disreputable behavior to condoning it.

FISA’s defender’s chant “national security” and to my knowledge there is nothing more than this rather empty slogan to support the position, a slogan that I had thought was used so much by the Nixon administration that it would not be heard again in connection with domestic activity. This slogan has also been used to justify the treatment of detainees and has been gradually rejected by the courts. Without anything to back it up it is just a slogan famously used around the world throughout the twentieth century. People need more substance to the claim for it to have traction outside of Congress.

The defenders of FISA point out that the guilty can still be prosecuted for crimes that were committed but few doubt that Bush will pardon everyone before leaving office. He, however, can only pardon for federal crimes and at least in theory any enterprising attorney general could investigate and prosecute under state law for crimes committed against its citizens. I doubt that anyone believes this will happen.

Bush is likely to pardon everyone in his administration, making the investigations promised by Obama unlikely. If McCain is elected he would not conduct investigations at all, at least as far as I know. The only way the Bush could be prevented from pardoning everyone would be for him to be impeached. If he were impeached, he could not grant pardons during the process. There appears to be no chance that this might happen.

Thus it appears that this itch to see criminal conduct exposed, or at least investigated, and punished will go unscratched regardless of the party favored in the next election. This rather sorry state of affairs is not without local precedent.

Civilization came to the Seattle area in the middle of the nineteenth century. Settlers first arrives on Alki, then some came to what is now the downtown area. A few located near the mouth of the Duwamish River between the two camps. Civilization, as everyone knows, requires government and the settlers were quick to elect a commissioner: Luthor Collins, our first governmental official. Two years after his arrival he was arrested for lynching a Native American. His civic leadership may have contributed to the dismissal of the charge. Later, having rooted himself in the administration of local affairs, he lynched two Native Americans and presumably it was his his august stature that prevented charges from being made.

Environmentalism and the Nazis

In the 1950’s communists were said to be infiltrating the government and the entertainment industry, as well as operating under several fronts. The McCarthy era ended when the demagoguery was challenged and the true charlatans were identified. While it lasted, though, it was a ticket to political prominence.

In the last few years some people have taken to identifying environmentalists as Nazis. This is actually done on national television and similar venues; we have almost grown to expect it in political campaigns. Such fear and hate mongering seems to be efficacious. You would think that it would backfire, but there must be more people swayed by it than repulsed.

On national media in 2006 Al Gore was compared to Nazi propagandist Goebbels and to Hitler for his success in publicising global warming. (It is a bit ironic that the people who diminish the Holocaust in this way tend to be Israel’s most zealous supporters.) On CNN Senator Inhofe actually described Gore’s testimony to the Senate Committee on the Environment and Public Utilities in that manner with the concurrence of Glenn Beck, the host.

In 2007 Fox News Radio continued the Gore/Hitler diatribe. CNN continued to transmit unbelievable comparisons to Hitler and Nazis. Glenn Beck recently said that Gore’s global warming campaign is like Hitler’s use of eugenics to justify exterminating 6 million European Jews.

With the new report on global warming just out, a report subscribed to about a dozen scientific groups associated with our government, doesn’t this treatment of science remind you of earlier, more primitive, periods of history?  Imagine: A world wide scientific conspiracy.  Really?

The hate and fear mongering diatribes are uniformly nothing more than name calling. There is no real rebuttal. Scientists picked “An Inconvenient Truth” apart pretty thoroughly finding some questionable facts and theatrics that suggested an unsupported conclusion. A UK judge found nine factual errors in the film.

But scientists and the British judiciary (one member anyway) agree that the film is rooted in good science and its overall message is supported by sound scientific theory and belief. This was known in 2007 and then Gore got a Nobel Peace Prize along with a U.N. panel of scientists investigating global warming. This, if anything, seemed to fan the flames of hate mongers.

This very odd discourse about environmentalism is probably the progeny of a pseudo-intellectual eddy in revisionist history. People are actually positing that environmentalism is a Nazi program, sort of like “Boys from Brazil.” This theory has been debunked by legitimate historians and even the people who are credited with originating this view disclaim any association with it.

A couple of years ago Jonah Goldberg’s book “Liberal Fascism: The Secret History of the American Left, From Mussolini to the Politics of Meaning” appeared. This book seemed to revitalize the “environmentalism is fascism” diatribe, although Goldberg claimed to have written nothing that was intended to suggest such a thing. The book sold well to mixed reviews. It was celebrated by conservative reviewers and panned by others.

The book’s thesis, behind all the pseudo-intellectual blather, is essentially Libertarian: Fascism means governmental regulation and liberalism means governmental regulation; therefore liberalism is fascist. Environmentalists want governmental regulation therefore they are fascists too. For proof just look at Nazi Germany where environmentalism was born. Nazis called themselves the national socialist party therefore socialists are fascists. Socialists are liberals. Very simple-minded stuff hiding in a lot of jargon.

This silly word parsing though unhinges people like those at the Building Industry Association of Washington who have made a habit of labeling anyone opposing their views as Nazis. In March their newsletter, in addition to more conventional name calling, called the Washington State Department of Ecology Nazis and lumped all environmentalists under that moniker.

This set off a local firestorm culminating in and Anti Defamation League demand for a retraction or apology. The B.I.A.W. of course refuses claiming the article (written by its storm drain columnist) is academically grounded. The B.I.A.W. is widely regarded as the Washington State Republican Party’s attack dog and neither the party nor any of its candidates has attempted to separate from this absurd propaganda machine.

Selling Before Foreclosure

With the number of foreclosures still rising, and the peak  not expected until fall, more and more people will be  confronted with  the decision whether to sell before the foreclosure date.   Before deciding to sell the homeowner should be satisfied that selling is the best alternative.

Due diligence in this regard should include talking with a bankruptcy lawyer, consulting with a knowledgeable mortgage broker or other qualified consultant about the possibility of refinancing, negotiating with the foreclosing lender, contacting local governmental agencies to see about assistance programs, consulting with a foreclosure expert to see what price the property is likely to get if it were sold in foreclsoure and to understand the process, and speaking with a real estate agent with experience in foreclosures about the market.  I can’t over emphasize the importance of talking to people with expertise in foreclosures, as they are likely to be far more helpful than people with general experience.

Once it is determined that sale is the best option, the laws of the state should be ascertained.  Some states, such as Washington, have distressed property laws that are intended to assure that a home owner in this situation makes an informed decision before parting with title.

These laws generally speaking reduce the interest of investors in buying distressed property, creating great opportunity for investors who are willing to comply with the law.  The laws also dramatically reduce the number of “rescuers” who hound homeowners in financial crisis and often prove to bring only financial disaster to a home owner.

I recommend that you list the property with a real estate agent with knowledge and experience in the area.  If you try to sell without an agent, give yourself a deadline, then list it if the property has not sold.  An agent will give the property much more marketing exposure than the typical non-agent sale and the expertise in this situation is usually helpful.

In marketing the property,  emphasis should be placed on  assuring the prosepctive buyer that you have done your homework and that  the buyer need not fear running afoul of the depressed property laws of the state.  A lawyer can help with this.

There should be a backup plan.  Often people plan to file bankruptcy if the property is not sold by a specified date.  It is a good idea to have already consulted with a bankruptcy lawyer and have the papers ready to file before that date.

Jail for criticizing Blackwater?

Washington has an obscure statute dating back to its territorial days that makes it a crime to with malice publish anything that exposes a person to ridicule or is injurious to  corporation.  It’s rather obscure and rarely prosecuted but it’s on the books! At RCW 9.58.010.

On its face this is rather troublesome.  Think of the number of times you have written or emailed or transmitted something (even a picture) that is critical of a corporation or might subject a person to chiding.  Maximum term: One year.

This statute, if vigorously prosecuted would give the state frightening power over people,  have a dramatically chilling effect on communications and a repressive effect on the citizenry.

It was recently invoked by the Department of Corrections against a prisoner.  The Court of Appeals took a look at the law and declared it unconstitutional, as overly broad and infringing on our freedom of speech.

In this instance we all benefited by the Court protecting the rights of a person in prison.

Equity Skimming in Washington: A Brief History

There are three main reasons that real estate has attracted so many unscrupulous people in recent years.

First it is an asset that can be highly leveraged. Homes can be purchased for a relatively small amount down and the balance financed. When property goes up in value this confers wild profit on the owner. For example, say you buy a home for $100,000 and pay 10% down. When the transaction closes you have purchased a $100,000 asset for an expenditure of one tenth its value. Putting aside transactional costs, if the property increases in value 25%, you have gained $25,000 in value on an original investment of $10,000. You more than doubled your money on a 25% increase in value of the asset.

The second aspect that attracts the criminally inclined, is that these very valuable assets are often owned by people who are not sophisticated in real estate financing. This is an area where people typically just given themselves to the grinding wheels of commerce without knowing a lot about what is going on in a real estate transaction. Thus there is great opportunity for duplicity behind a mask of convention.

This area is also relatively unpoliced. In the early 1900’s the scam of choice was securities fraud. So many people were falling victim to fraudulent securities schemes that the federal government created the Securities Exchange Commission and in the 1930’s passed legislation imposing severe penalties for securities fraud and implementing broad disclosure requirements.

Many equity skimmers would probably have been selling bunko stock one hundred years ago. The equity skimming schemes of today occupy a relatively unpoliced area without much in the way of legislation (although states such a Washington are passing legislation to thwart this form of fleecing). In short home sales is an area where a lot of money passes hands, there is potential for fast profit and there is not a great deal in the way of scrutiny — similar to stock sales before the Security Exchange Commission.

There have always been lots of real estate scams but for our purposes the story starts in the 1970’s. There was a recession in the early 70’s (or something that looked remarkably like one). An average house in Seattle could be purchased for $15,000, due in large part to local economic problems. This was followed by a period of inflation and breathtakingly high interest rates.

The inflation encouraged people to sell their real estate profitably, but the high interest rates prevented many people from getting loans to buy real estate. These pressures created an era of seller financing. The buyer would give the down payment to the seller and make monthly payments to the seller with an agreement to pay the purchase price off in full in three to five years, when financing could be obtained. This sort of arrangement was commonplace.

The buyer got the house and with it the obligation to pay payments to the seller and the obligation to continue to pay the seller’s mortgage. The buyer could assume FHA loans but usually the buyer just agreed to make the payments for the seller after the sale. The malevolent instincts that had been somewhat suppressed by federal laws in the area of securities sales were revived in this situation.

All sorts of bad things happened. Crooks would buy homes with faulty seller financing documents so sellers could not foreclose if they were not paid by the buyer, while at the same time they remained obligated on the mortgage which the buyer might choose not to pay. Companies were formed that bought real estate on seller financing, then just stripped the property of everything of value and left the barren property for the sellers to foreclose upon.

Seller financing deals could be structured to protect the seller, but there is always a portion of the population that does not consult a lawyer before entering into a transaction of this sort. It is this group around which financial vultures circle.

There was nothing of the magnitude of the massive systematic fraud of recent years, so the legislature was relatively slow to address the problem of equity skimming. In 1988 Washington passed a law that criminalized equity skimming and declared it to be a violation of the Consumer Protection Act. The forward to the bill states in part:

The legislature finds that persons are engaging in patterns of conduct which defraud innocent homeowners of their equity interest or other value in residential dwellings under the guise of a purchase of the owner’s residence but which is in fact a device to convert the owner’s equity interest or other value in the residence to an equity skimmer, who fails to make payments, diverts the equity or other value to the skimmer’s benefit, and leaves the innocent homeowner with a resulting financial loss or debt.

Financial institutions had their hands full in the 1980’s. Seafirst Bank, the biggest bank in the Northwest was going bankrupt until it was purchased by Bank of America. Other big banks swallowed smaller ones into the nineties. Two of the biggest Seattle banks, Peoples Bank and Old National Bank, were bought by U.S. Bank of Oregon and merged into U.S. Bank of Washington. This activity seemed to occupy attention much more than occasional fraud on homeowners.

The opportunity for homeowner fraud errupted like never before during the Bush Administration. The administration’s laizes faire, anti-regulation bias allowed this situation to reach international economic crisis proportions, despite obvious abuses all along the way. (The policies that created the situation were constant between Clinton and Bush, but Bush’s response to the financial crisis made Katrina relief look adequate and timely.)

The subprime era was awash in home loan money; lenders could hardly give it away fast enough. Home loans were obtained without a great deal of review for as much as the full purchase price of a home. This was like a petri dish for raising a culture of financial fraud.

People were so eager to get at the money there were numerous seminars given on equity skimming. Small fortunes were made on the price of admission alone. These week-long seminars were packed with local real estate people, real estate agents, brokers and miscellaneous others. People from Seattle, Everett, from all over the Western part of the state attended.

Recently indicted Charles Head (California based) advertised on the internet, sent faxes to mortgage brokers and people in the real estate industry and nurtured relationships with lenders and escrow companies. He had dozens of companies that were nothing more than names to confuse the public. Sometimes the companies described themselves as facilitators, sometimes as lenders, sometimes as lenders’ agents, sometimes buyer’s agents, sometimes both lender and buyer’s agents and often not at all.

Rob McKenna Thinks We Are Idiots.

Washington State’s Attorney General Rob McKenna really should be in the Bush administration. He demonstrates a presidential grasp of what he is doing. His opinions are not rational, at least that is the conclusion you must reach if his arguments are in fact the basis of his opinions.

Generally speaking tort law has two purposes: to compensate victims and to enforce rules of conduct that are accepted as societal standards. Its purpose is in part to help mold society into behavior patterns that are predictable and reasonable. A debate about tort reform should address the realization of those goals, then perhaps weigh the cost to society against the benefit of particular laws. You would expect a reasoned argument to discuss alternatives to the law in question and their relative merit.

Unfortunately it is never done that way. Often proponents of tort reform merely attempt to excite the general prejudice against trial lawyers. This is politically expedient but does nothing to advance our interest in living in a rational society. The other common argument is to throw out a figure and say that is how much money has been awarded for something. The argument proceeds by saying this figure is way too high and concludes with: ergo we should abolish that law. This is exactly how insurance companies look at things but this approach seems to have traction with the general public. In truth this is not an argument at all and again is little more than an appeal to prejudice or sometimes sympathy for the perpetrators of tortious conduct.

Mr. McKenna believes that sovereign immunity should be re-instituted in Washington after having been abandoned in the 1960’s. His argument goes like this: The State of Washington has paid over $500 million in the last 25 years. If the State could not be sued, it would not have to pay anything and there would be no problem. End of argument. He spices this up a little by adding that the trial lawyers are always expanding the State’s liability. With that he has pretty much covered everything.

Why didn’t we think of this with drunken driving?  That costs a lot too.  This would be a good approach to cutting down crime.  Make homicides legal.  Washington has already pursued this approach with construction defects and disasters.  Why not expand the approach.  It’s working isn’t it?

What you Should Do If Facing a Foreclosure

It is readily understandable when people in financial distress make bad decisions and a notice of default or foreclosure from your bank is certainly distress inducing. I will list some things that everyone in this situation should at least look into. I will focus on Washington law, which may be instructive to people in other states but care should be taken to verify the law of your state. This almost certainly requires seeing a lawyer.

Almost all foreclosures are deed of trust foreclosures but you must know what type of instrument encumbers your home. For example with seller financing, if you went that way instead of conventional financing, a real estate contract may be involved and sometimes a mortgage rather than a deed of trust is involved. Because mortgages have used in all states the literature usually refers to “mortgage foreclosures” and when used in this way “mortgage” is being used as a generic term covering any or all of the three mentioned security instruments.

I will be writing in reference to nonjudicial deed of trust foreclosures because over 99% of home foreclosures are of this sort. It is called “nonjudicial” because there is no lawsuit; instead there is only a series of notices culiminating in a trustee’s sale.

The Process

The sequence of events involves typically a few preliminary letters from the bank. This is followed by a notice of default which is a formal notice that starts the statutory foreclosure process. It is mailed, and may be served or posted on the door. It contains information about the debt and information about the foreclosure process. After at least a month and maybe a longer period you receive a notice of foreclosure and a notice of trustee’s sale. These have all the details about the foreclosure sale and the debt to the bank and set the time and date of the foreclosure sale (called the “trustee’s sale” in the notice). Notices are published and recorded but there a no more notices sent to the homeowner.

What to Do

1. Read every letter and notice carefully. This is rarely done. Most people are so upset they do not know what the communications say, but they contain vital information that must be considered.

2. Try to refinance. Make this a rigorous process. Talk to the foreclosing bank if you can and other banks, then talk to several mortgage brokers. They do not all have the same information or ability.

3. Consider selling. There are so many of these sorts of sales that they warranted a name: “short sales,” meaning they have to close before the trustee’s sale. Find a good real estate agent with whom to list the property. Again talk to more than one. The listing agreement should include exactly what will be done to market the property. Put that in — all the details — because the form will only have very general information. Get the most aggressive plan that you can find. Often there are scheduled price reductions as you get closer to the sale date. If you do this, write to the bank to see whether the bank will cooperate with the sale. It may agree to put the foreclosure off to allow a sale by you because if the foreclosure goes through the bank usually ends up with the property and then it has to try to sell it. Your sale of the property can save the bank time and money.

4. Inquire about programs to help you you bring the loan current. You may qualify for a program designed to assist you. There are not many of these but inquire of the city, county and state whether there are any programs that might provide financial assistance.

5. Talk to a bankruptcy lawyer. Bankruptcies are intended to provide relief for this sort of financial distress. There may be a plan which will enable you to bring the loan current. Even if there is no such plan available, you may be able to sell the property under the protection of the bankruptcy court so as to be able to preserve the equity you have in the property.

6. You are likely to receive a number of “rescue” proposals in the mail. Do not enter into any of these without consulting with a real estate lawyer. Usually the inducement for people to offer these to you is that they can take your equity in your home. There are dozens of ways to accomplish this. These “rescues” are so frought with peril for the home owner that you should absolutely never enter into one without legal advise and a clear understanding of what is happening. Some of these “rescues” even involve identity theft and forgery, so do not even apply for anything before you are certain of what you are doing and who you are doing it with.

7. Make sure your adviser complies with the law and make sure that everything of consequence that you are told is put in writing. You can just jot it down and ask the adviser to sign it. In any case there should be a record of the things that you are told. Also be aware that these “advisers” are probably required to be licensed as a real estate agent. Find out all you can about the person and his or her history. Find out how many of these deals they’ve done and how many ended in the eviction of the homeowner. Get this in writing. Do a property record search to see how many homes this person or her company has taken. Search for everyone involved in the transaction, as there are usually at least two people and a company or two.

The Bill to Prevent Scams

The Washington legislature just passed a law to regulate people who come forward with advice for you about how to escape your situation. As of this writing House Bill 2791 has not been signed by the governor but it surely will be, as it passed both the state senate and house without a dissenting vote. It should become effective 90 days after being signed by the governor.

This bill requires that a number of different written disclosures and notices be provided to the homeowner by the “distressed home consultant.” The terms of the transaction must be spelled out in detail, including all the money being paid to the consultant and others who are involved. This must be signed by both parties. If the consultant represents anyone else, this must be fully disclosed in writing. Follow up on this very carefully. Find out all the details of the other relationship and be sure you get them in writing.

The bill creates a fiduciary duty from the adviser to you. This is the highest duty imposed by law. You are owed the duty of complete disclosure and full honesty. Your questions and concerns must be fully addressed. They are required to act in your best interest, so it is quite possible that a relationship with someone else in the transaction creates a conflict of interest.

All contracts are required to be in the language used by the homeowner. (This requirement would reduce fraud in a number of different situations apart from foreclosures, but at least in Washington I believe that it stands alone.)

The contract must comply with a number of requirement, including a notice of a five day cancellation right.

No doubt the most significant substantive right created by the bill is the duty of the consultant to verify that in fact the homeowner is able to buy back the home. Usually in these situations, the home owner is given an option or something of the sort to buy the property back after giving it away. In my experience it is unusual for a homeowner to be able to exercise this right before it terminates. This bill puts the burden on the facilitator to verify, and be able to prove, that the home owner had the ability to buy his or her home back.

Another provision with teeth is the requirement that the homeowner recieve at lease 82% of the market value of the home before an eviction can be done. This will certainly slow down people motivated by windfall profits and it gives assurance that the homeowner will not usually be left homeless and penniless.

There are a number of other aspects of the bill but time prevents a full discussion.

Washington Becomes a Lead State in Cracking Down on Foreclsore Scams

I almost missed it! This is great day because the legislature passed last night the equity skimming bill recommended by the Washington State Attorney General in January of this year. In two months the legislature passed a comprehensive bill specifically addressing foreclosure rescue scams. Representative McIntire called my this morning on his way back to Olympia from Seattle. He said that the yesterday’s session did not end until 1:30 this morning. The time was apparently very well spent.

This bill, HB 2791 , strikes right at the heart of the frauds that have been perpetrated on homeowners, making these scams felonies, as they should be. People who p[resent themselves to homeowners as consultants for foreclosures and default ed home loans are now subject to disclosure requirements and well articulated standards of behavior. The “savior” is prevented from absconding with more than 18% of the equity.

I will provide a more detailed discussion of the bill at a later date. When not impeded by special interests the Washington legislature is capable of very speedy action. With this bill (assuming the governor signs it, which is a safe assumption) Washington become one of the lead states in criminalizing this reprehensible behavior and regulating the permissible scope of legitimate activity.