Possible Bank Fraud? — Follow-up to “Obama’s America”

BACKROOM DEALS, HOLDING COMPANIES, PROFITS AND FRAUD

Guest Editorial

(Jan. 4, 2010) — Having done some investigating after relinquishing our interest in two investment properties on December 23, 2009, it appears that we did not sign a deed in lieu at all. The properties were not returned to the bank. Instead, a company called “Windham North Properties, LLC” was listed as the buyer on a standard HUD settlement form, and we were listed as the sellers. However, the name of the bank was nowhere to be found on any of the settlement papers. How could an entity which supposedly had no financial interest in two properties “buy” them from us for exactly what was supposedly owed to the bank?

At the closing, we were shown a document which described Windham North Properties, LLC as a “wholly-owned subsidiary” of Putnam Bank in Putnam, CT. Thomas Borner was listed as the president of the LLC as well as president and CEO of the bank. We were not given a copy of this document, although we read it completely.

Windham North Properties, LLC shows up nowhere on Putnam Bank’s website, although other “wholly-owned subsidiaries” do. Although the website (www.putnambank.com) describes the bank’s beginnings in 1862 to today and includes its change in charter in 2003 as well as interrelated companies and subsidiaries, there is no mention of Windham North Properties.

While it has been registered with the Connecticut Secretary of State’s office (http://www.sots.ct.gov/sots/site/default.asp) since 1999, there is no connection whatsoever to Putnam Bank indicated. Additionally, Windham North Properties, LLC does not come up on any internet search engine.

Area real estate agents report that Putnam Bank has apparently never had a foreclosure. Perhaps that is because Windham North Properties is the actual receiver of foreclosed or deed-in-lieu properties. Because the entity is hidden from sight and knowledge of the average borrower or member of the community, it gives Putnam Bank the appearance of never having foreclosed on any property at any time.

We have received calls from our former tenants this past week, despite the property management company having my husband sign a letter of introduction naming them as the new building managers. Apparently they never distributed the letter to the tenants. Our former real estate agent said that she was told that they were all in a hurry to go to Florida for vacation over Christmas week, and that is why everything was rushed through the way it was. Evidently if the tenants lose heat or electricity, there is no one for them to call.

We have also learned from the agent that one of her prospective buyers was contacted by the Senior Retail Loan Officer directly about a 3% mortgage on the building in which they had shown some interest. Emails show that occurring BEFORE we had turned over the leases, keys and lock combinations the evening of December 23. So the bank was already trying to make a deal, cutting out the real estate agent and us from any potential profits.

Reportedly, the bank officer involved also represented the property as having been foreclosed, which is significant. According to the agent, if a property is foreclosed, the seller has no obligation to provide any information about it to a potential buyer. Since our properties were not foreclosed, the bank officer, who actually does not even have possession of the property based on the paperwork, is misrepresenting its status to a potential customer while attempting to offer that customer a mortgage deal without the agent, whose job it is to protect that buyer’s best interests.

There was a clause in the agent’s contract which stated that if a listing was canceled but the property sold within 30 days of cancellation, she is entitled to a 3% commission. Our bankruptcy attorney has reviewed the paperwork and stated that technically, there in fact was a sale on December 23. He added that if Windham North Properties, LLC really is a wholly-owned subsidiary of Putnam Bank, the transaction was probably legal, but if it is owned by Thomas Borner, who is listed as its president, then “there is a problem.”

The real estate agent plans to consult with her office’s attorney regarding legal recourse for her lost commission. As the “sellers,” we could be held liable for it. While our bankruptcy attorney is committed to protecting us from creditors, the bank and/or property management company could be held liable for fraud. We were not supposed to be “selling” the properties to anyone; rather, we had been told that we were turning over our interest in them to the lender, Putnam Bank.

Had the bank given us a reasonable amount of time to sell the buildings, which we had been aggressively trying to do, we could have paid them off plus all of our outstanding debts, including medical bills, as our level of debt was not that significant. We would not have had to file for bankruptcy at all. As it was, they did not even give us 90 days.

So it’s true: they issue loans to make huge profits, and when a customer can no longer make the payments, they want the property to sell at a profit. They hide their transactions in holding companies and subsidiaries and engage in backroom deals, misrepresenting the facts and cheating the average citizen. They say one thing and do another.

As for us, we are therefore looking for an attorney skilled in bank fraud, because this is exactly what this is.