Smart Money

THE SUBPRIME TRUMP CARD:  STANDING UP TO THE BANKS

by Ellen Brown, June 26th, 2008

“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around them will deprive the people of all property until their children wake up homeless on the continent their fathers conquered. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.”

– Thomas Jefferson, Letter to Treasury Secretary Albert Gallatin (1802)

Jefferson had it right. More than 1.5 million homeowners are expected to enter foreclosure this year, and about half of them are expected to have their homes repossessed. If the dire consequences Jefferson warned of 200 years ago have been slow in coming, it is because they have been concealed by what Jerome a Paris calls the Anglo Disease – “the highly unequal economy whereby the rich and the financial sector . . . capture most of the income but hide it by providing cheap debt to the middle classes so that they can continue to spend.” He calls “finance” the “cannibalistic” sector in today’s economy. Writing in The European Tribune this month, he states:

“[O]ne of the more attractive features of the financial world, for its promoters, is its ability to concentrate huge fortunes in a small number of hands, and promote this as a good thing (these people are said to be creating wealth, rather than capturing it). . . . [O]f course, the reality is that such wealth concentration is created by squeezing the rest, as is obvious in the stagnation of incomes for most in the middle and lower rungs of society. This is not so much wealth creation as wealth redistribution, from the many to the few. But what has made this unequality . . . tolerable is that the financial world itself was able to provide a convenient smokescreen, in the form of cheap debt, provided in abundance to all. The wealthy used it to grab real assets in funny money, and the rest were kindly allowed to keep on spending by tapping their future income rather than their insufficient current one; in a nutshell, the debt bubble hid the class warfare waged by the rich against everybody else.”1

Now the debt bubble is bursting, with the anticipated real estate crash, banking crisis, foreclosures, and inevitable recession. “The income capture mechanisms set up during the bubble have not been reversed, so the pain is falling disproportionately on the poorest,” writes Jerome a Paris. Meanwhile, finance is being bailed out. What’s to be done? “[T]he financiers . . . will say that more ‘reform’ and ‘deregulation’ and tax cuts are needed,” he says, but “maybe it’s time to stop listening to what is highly self-interested drivel, and take back what they grabbed: it’s not theirs.”

Good idea, but how? The financiers own the media, and their massively funded lobbies control Congress. How can we the people get enough clout to take on the giant financial and corporate giants? What can we do that will make politicians sit up and take notice?

How about swarming the courts? New case law indicates that a majority of the 750,000 homeowners expected to lose their homes this year could have a valid defense to foreclosure. As much as $2 trillion in real estate may be vulnerable to this defense, providing a very big stick for a lobby of motivated debtors. Mobilizing that group, in turn, could light a fire under the investors in mortgage-backed securities — the pension funds, money market funds and insurance companies holding these “orphan” mortgages. These investors also wield a very big stick, in the form of major law firms on retainer. When the embattled banks demand a bailout because they are “too big to fail,” the taxpayers can respond, “You have already failed. It is time to try something new.”

The Legal Trump Card: Make Them Produce the Note

A basic principle of contract law is that a plaintiff suing on a written contract must produce the signed contract proving he is entitled to relief. If there is no signed mortgage note or recorded assignment, foreclosure is barred. The defendant must normally raise this defense, and most defaulting homeowners, unaware of legal procedure and concerned about the expense of hiring an attorney, just let their homes go uncontested. But when the plaintiffs bringing subprime foreclosure actions have been challenged, in most cases they haven’t been able to produce the notes.

Why not? It appears to be more than just sloppy paperwork. The banks that originally entered into these risky subprime arrangements generally did so because they had no intention of holding the loans on their books. The mortgages were immediately sliced and diced, bundled up as mortgage-backed securities (MBS), and sold off to investors. Loan originators sold the mortgages to financial institutions or other banks, which then sold the rights to the monthly mortgage payment income to investors, while transferring the responsibility to collect these payments to specialized mortgage servicing companies. The result has been to slice up the mortgage contract, with no party really having ownership of the original paperwork. When foreclosure has been initiated, the servicer or trustee acting as plaintiff now has trouble proving that it originated the mortgage or owned the loan. In order for a second bank or financial institution to have standing to bring a foreclosure lawsuit in court, it must have been assigned the mortgage; and with the collapse of the housing market, many of the subprime lenders have gone out of business, making it impossible to contact the originating mortgage company. Other paperwork has just been lost in the shuffle.2

Why weren’t the mortgage notes assigned to the MBS holders when they were first sold? Apparently because the investors aren’t even matched up with specific properties until after default. Here is how the MBS scheme works: when the mortgages are first bundled by the banks, all of the subprime mortgages go into the same pool. The bundled mortgages are chopped into “securities” that are sold to many investors — banks, hedge funds, money market funds, pension funds — with different “tranches” or levels of risk. The first mortgages to default are then assigned to the high-risk “BBB-” tranche of investors. As defaults increase, later defaulting mortgages are assigned down the chain of risk to the supposedly more secure tranches.3 That means the investors get the mortgages only after the defendants breached the agreement to pay. It also means the investors weren’t a party to the agreement when it was breached, making it hard to prove they were injured by the breach.

The investors have another problem: the delay in assigning particular mortgages to particular investors means there was no “true sale” of the security (the home) at the time of securitization. A true sale of the collateral is a legal requirement for forming a valid security (a secured interest in the property as opposed to simply a debt obligation backed by collateral). As a result, the investors may have trouble proving they have any interest in the property, secured or unsecured.4

The Dog-Ate-My-Note Defense

When the securitizing banks acting as trustees for the investors are unable to present written proof of ownership at a time that would entitle them to foreclose, they typically file what’s called a lost-note affidavit. April Charney is a Florida legal aid attorney well versed in these issues, having gotten foreclosure proceedings dismissed or postponed for 300 clients in the past year. In a February 2008 Bloomberg article, she was quoted as saying that about 80 percent of these cases involved lost-note affidavits. “Lost-note affidavits are pattern and practice in the industry,” she said. “They are not exceptions. They are the rule.”5

In the past, judges have let these foreclosures proceed; but in October 2007, an intrepid federal judge in Cleveland put a halt to the practice. U.S. District Court Judge Christopher Boyko ruled that Deutsche Bank had not filed the proper paperwork to establish its right to foreclose on fourteen homes it was suing to repossess.6 That started the ball rolling, and by February 2008, judges in at least five states had followed suit. In Los Angeles in January, U.S. Bankruptcy Judge Samuel L. Bufford issued a notice warning plaintiffs in foreclosure cases to bring the mortgage notes to court and not submit copies. In Ohio, where foreclosures were up by a reported 88 percent in 2007, Attorney General Marc Dann was reported to be challenging ownership of mortgage notes in forty foreclosure cases.7

Few defendants, however, are lucky enough to have advocates like Charney and Dann in their corner, and most defaulting debtors just let their homes go. A simple challenge can be filed to the complaint even without an attorney, and some subprime borrowers have successfully defended their own foreclosure actions; but retaining an attorney is strongly recommended. People representing themselves are often not taken seriously, and they are likely to miss local rule requirements. With that warning, here is some general information on challenging standing to foreclose:

Some states are judicial foreclosure states and some are non-judicial foreclosure states. In a judicial foreclosure state (meaning the matter is heard before a judge), if a promissory note or recorded assignment naming the plaintiff is not attached to the complaint, the defendant can file a response stating the plaintiff has failed to state a claim. This can be followed with a motion called a demurrer to the complaint. Different forms of demurrers can be found in legal form books in most law libraries. In essence the demurrer states that even if everything in the complaint were true, the complaint would lack substance because it fails to set out a copy of the note, and it should therefore be dismissed. Ordinarily there is no need to cite much in the way of statutes or case law other than the authority reciting the necessity of showing the note proving the plaintiff is entitled to relief.

In a non-judicial foreclosure state such as California, foreclosure is done by a trustee without a court hearing, so the procedure is a bit trickier; but standing to foreclose can still be challenged. If the homeowner has filed for bankruptcy, the proceedings are automatically stayed, requiring the lender to bring a motion for relief from stay before going forward. The debtor can then challenge the lender’s right to the security (the house) by demanding proof of a legal or equitable interest in it.8 A homeowner facing foreclosure can also get the matter before a court without filing for bankruptcy by filing a complaint and preliminary injunction staying the proceedings pending proof of standing to foreclose. A judge would then have to rule on the merits. A complaint for declaratory relief might also be brought against the trustee, seeking to have its rights declared invalid.9

An Equitable Settlement for Everyone

These defenses can help people who are about to lose their homes, but there is another class of victims in the sub-prime mortgage crisis: investors in MBS, including the pension funds and 401Ks on which many people depend for their retirement. If the trustees representing the investors cannot foreclose, the lucky debtors may be able to stay in their homes without paying. However, the hapless investors will be left holding the bag. If the investors manage to shift liability back to the banks, on the other hand, the banks could go down and take the economy with them. How can these tricky issues be resolved in a way that is equitable for all? That question will be addressed in a followup article. Stay tuned.

Ellen Brown, J.D., developed her research skills as an attorney practicing civil litigation in Los Angeles. In Web of Debt, her latest book, she turns those skills to an analysis of the Federal Reserve and “the money trust.” She shows how this private cartel has usurped the power to create money from the people themselves and how we the people can get it back. Her websites are webofdebt.com and ellenbrown.com.

Here’s some thoughts I’ve found from others about the proposed bail out of banks.

From Matt Furey:

As you’re probably aware of by now, today is the day that Senator John McCain is back on Capitol HIll - presumably to “fix” our nation’s broken economy.

Hold the phone a minute.

Let’s ponder the question no one is asking: How does a government that is already a gadzillion dollars in debt “fix” the economy.

Think of this. If my business was a gadziillion dollars in debt, would you ask me for a loan. Would you ask me how to improve my financial situation. Would you allow me to “fix” things for you.

Not likely.

Yet, millions of Americans place their hopes in politicians and the Washington elite - most of whom have NEVER owned or operated a business - to ride to the rescue… to save the day…

Well, I got news for you. A band-aid on a cancerous tumor doesn’t make it go away. It may make you FEEL like things have changed - but your feelings may be dead wrong.

Yet, while all the finagling is going on in Washington to save our economy - there is a clandestine group of men and women who really don’t worry about which way the
economic winds blow. Why. Because no matter what - they are going to “find a way” to profit from it.

And these from the Rude Awakening:

First up, some thoughts from David Myhre reporting from, Stuart, FL…

Same message, different story. We MUST pass the Patriot Act NOW. Saddam has WMD - we MUST act NOW to protect America. The financial markets are falling - we MUST act NOW to save America. All I can say is, the town that heard the “WOLF !!” cry only took two fake calls to realize they were being conned. What about us and our “leaders” in DC ?? How many of these BS scares will it take to realize they’re blowing smoke again ? The Empire of George II falls back to its most successful ploy - act now or be destroyed. And anybody opposed is anti-American.

Answer me this, Hank and Ben - if Congress throws a couple trillion dollars after the stupid losses financial institutions have blown, will you GUARANTEE it will fix the problem ? Will you sign over your personal wealth to the US government to help pay for your plan’s failure ? The two most important questions are:

If we don’t accept your proposal, is a crash certain ?

Will this plan fix the problem and avert a crash ?

And therein lies the true question. Nobody that I know has said a crash is certain whether or not a “bailout plan” is carried out. Similarly, nobody I know of has certified that a “bailout” plan would fix the problem. It all boils down to credibility. And the administration of George II has none. Paulson in my book, who was head of Goldman Sachs during its massive increase of leverage, has none. And clearly, Bernanke’s opening of the Fed discount window has averted nothing and perhaps aggravated the situation.

Let the mismanaged financials fail and their assets get bought up by more ethical competitors. Let the fools who bought overpriced real estate using idiotic mortgage plans rent. Let the law of logical consequences solve this problem. Sure, some of Hank and Ben’s country club buddies may have to sell the house in the Hamptons, but hey, fair is fair. Bailouts aren’t.

In fact, it is not a slap in the face to people like me - it’s a right cross and a low blow by people who are in positions of trust who cannot be trusted. I worked hard, saved, invested wisely, never bought a new car, paid my bills and lived within my means. How dare you spoiled Wall Street brats tell me I should be responsible for scalawags such as you ? Millions of RESPONSIBLE Americans are NOT losing our homes to foreclosure because we bought homes we could afford. How dare you swindle us into paying for the irresponsible people who wrote loans to people who you KNEW couldn’t pay and the ignorant ones who bought more house than they could afford.

This plan in every aspect is UNAMERICAN. The FAIR way to solve this mess would be to sieze the assets of the offending financial institutions and use the proceeds to protect responsible Americans from the ill effects of the greedy financiers who caused this mess. The FAIR way to ensure it never happens again is to ban the officers and directors of the companies that created this mess from ever working in a financial company again.

But hey, socialists have never really cared what’s fair. Or Capitalists, for that matter. And former capitalists who want to socialize losses after pocketing profits couldn’t care less about the poor shmucks they con into paying for their irresponsible behavior.

I do not believe one word Paulson or Bernanke say. I believe a shakeout is the only thing that will scour the scum out of a largely dysfunctional financial sector that operates without ethics and is more casino gambling than responsible investing.

In 1930, the perps jumped out of windows. In 2008, the perps get a golden parachute. We’ve come a long way, baby, and it isn’t all for the better.

And this, from Marc Abramsky, a sympathetic Canadian…

Always interesting reading your eletter. Very informative with a nice tidbit of useful information daily.

I am Canadian and I agree strongly with your take on Paulson and the way in which he Fed is acting in bailing out their rich buddies.

I think people have long understood this double standard but never before has it been so blatantly waved in front of the public’s face. I simply can’t fathom how this debacle has been allowed to take place. That the clear minority should be able to exercise this appalling act without so much as a peep from the tax payer and general populace. Even here in Canada (where we are deemed very conservative compared to our southern North American’s) this would cause a minor revolution. Especially in Quebec. These greedy, self-serving, ego centric, morons, should be herded up and thrown in jail. Nothing less. This is a crime scene, no different than Enron or any other scandal where greedy executives have deliberately taken the public’s money.

In fact thieves might be better here, at least they are anonymous unseen faces until they are caught. These jokers are supposed to be leaders. The whole world watches now with complete disgust as liars, cheats, thieves and crooks are rewarded for their crimes.

What a sad place the USA has become. What was once a worldly icon of freedom, opportunity and integrity has become a sham. A place where white collar crime flourishes.

What are your thoughts?

Today’s comment is by Bob Bauman, JD, former U.S. Congressman and long-time Senior Writer and Legal Counsel for The Sovereign Society.

Dear A-Letter Reader,

Not far from America’s financial epicenter, universally known as “Wall Street,” is a huge, empty crater where the Twin Towers of the World Trade Center once stood.

Within weeks of the disaster that annihilated those once-glorious free market icons, fear served as the justification for a panicked U.S. Congress to enact the so-called PATRIOT Act.Without even seeing the text of the bill, the congressional herd mentality to “do something!” produced one of the greatest assaults on the American Constitution ever passed into law. Its odious impact on our liberties still remains today. And barring the miracle of a new Congress emerging with both courage and common sense, it will continue on for years to come.

And now we find ourselves 7 Septembers after 9-11, in a different yet all too familiar national media “panic.”

“The experts” are telling us that the Congress must act immediately to bailout Wall Street, adding nearly a trillion dollars to the national debt. (The existing public debt alone figures out to be US$31,600 for every man, women and child in America, and this new demand will add another estimated US$2,300 for every American).

But wouldn’t hindsight prompt us to think before acting this time around?

Welfare on Wall Street

I am not going to review here the immediate and past history that TV talking heads recite ad nauseum that leads to a media-induced national migraine. Instead, let’s go back to the beginning.

Wall Street’s name is a direct reference to a defensive wall that Dutch settlers erected on the southern tip of Manhattan Island in the 17th century. The area didn’t become famous as America’s financial center until the end of the 18th century, when 24 of America’s most prominent brokers signed an agreement that created the New York Stock Exchange.

But now, in my humble opinion, it is time to resurrect that wall, at least figuratively, and certainly politically and legislatively - in order to defend America against Wall Street.

The garrulous Senator from Delaware, Joe (The Mouth) Biden made the news last week in saying that paying greater taxes was wealthy Americans’ “patriotic duty.” But even he could not foresee the dimensions of what would come next…

Yes, the “panic” came quickly. Lehman Brothers Holdings Inc. filed for bankruptcy protection. The government took control of AIG. Liquidity froze up. They’re saying this could be the most dire market malfunction since the crashes of 1987 - or even 1929.

But the crash was not a surprise to everyone. Here at The Sovereign Society we have long been warning you individually and collectively for quite some time. We told you that the House of Cards was going to collapse - it was just a matter of when. And we have been offering sound investment alternatives to avoid the disaster.

What Lies Beyond the “End of an Empire” Closeout Sale?

“The financial market crisis of 2007 may be remembered as the beginning of the nationalization of a large part of the financial system.” So wrote Floyd Norris in The New York Times. (Dec. 14: A Worrisome New Wrinkle in Bailouts).

Norris also noted that it was foreign governments’ billion dollar “sovereign wealth funds” that came to the rescue last year: “It took a [Singapore] government bailout to shore up UBS…it was Citigroup that got [Abu Dhabi] government aid to help recover from its bad investments.”

Now we are told that the United States government, headed by a Republican president, must create its own US$700 billion sovereign wealth fund (or sovereign debt fund) to rescue us once again. This fund must buy up an untold amount of investment vehicles gone bad - home and other real estate mortgages, sub-prime derivatives, exotic instruments few understand and no one seems able to evaluate - except by calling it “junk.”

And all this, only weeks after Congress adopted a US$300 billion housing bill that was supposed to solve the crisis!

If It Looks Like a Duck and It Quacks Like a Duck…

Bank bailouts may or may not be necessary to avoid a major economic recession, but government owning private businesses and banks smacks of fascism.

Yes, dear readers, if you enjoy reality TV shows, you’ll love the reality of the same kind economic fascism once promoted by Mussolini, Hitler and Juan Peron, among other economic crackpots. Hugo Chavez, anyone?

America, welcome to “backdoor fascism.”

Added to all their other horrors, these fascist leaders put their national economies under government control without outright confiscating the means of production.

Fascist governments nationalized key industries - especially banks - managed currencies and made massive state investments. True, fascist economies were based on private property and private initiative. But these were contingent upon agreement with and service to the state.

The industrial and business aristocracy of a fascist nation often put the government leaders into power. In doing so, they created a mutually beneficial business/government relationship and power elite.

Have you checked how much Wall Street has donated to both Democrats and Republicans in Congress who are now writing the new emergency bailout laws?

Fascist regimes were governed by groups of friends and associates who appointed each other to government positions. They then used power and authority to protect their friends from accountability. Fascist governments instituted state-regulated allocation of resources, especially in the financial sectors.

“Oh, but that can’t happen here,” you protest.

Hey, folks, just look around. Isn’t any of this beginning to appear sickeningly familiar? What is past is prologue!

At Least Someone Out There is Making Sense

Newt Gingrich is one of the few urging Congress to step on the brakes in this US$700 billion bailout plan,

In National Review online, former speaker of the U.S. House of Representatives, Gingrich writes: “Congress was designed by the Founding Fathers to move slowly, precisely to avoid the sudden panic of a one-week solution that becomes a 20-year mess.”

In an NPR radio interview, Gingrich said he thinks the bailout plan is “just wrong,” and that “it’s likely to fail, and it’s likely to make the situation worse over time.”

Will America ever Wake Up and Smell the Totalitarianism?

Wouldn’t it be unusual - even heroic - if the two current candidates for the U.S. presidency stopped their irrelevant hollering at each other? If they dropped their absurd daily nostrums that even they know will never become law?

Isn’t it about time that they cancel their campaign whistle stops and return to the U.S. Senate Chamber, (where, after all, they are both still members), and participated in a real debate? Perhaps about where America and the national economy truly should be headed - and what they would do about it?

If ever there has been a point in modern times when true leadership was needed, that time is now.

BOB BAUMAN, Legal Counsel

“In times of change, learners inherit the earth, while the learned find themselves beautifully equipped to deal with a world that no longer exists.”  Eric Hoffer

Dear Reader,

Contrary to popular belief, there is no such thing as an educated person. You are either learning or you are not. In today’s world, it is vitally important that you see the truth in Eric Hoffer’s statement. The win or loss, which is waiting in the wings for every person, is enormous. You get to choose which you will experience.

Examine what Mr. Hoffer said. There are two obvious parts to his statement. The first part is very clear; how well it is understood is another subject.

“The learners will inherit the earth.”

That’s pretty straightforward. I want to come back and elaborate on that statement because it is exciting, full of promise and possibility. However it would probably be wise to look at the second part of his advice first. Then, if you happen to fall into the category Eric Hoffer referred to, you can change your situation and win.

“The learned find themselves beautifully equipped to deal with a world that no longer exists.”

In virtually every country of the world you can find individuals, thousands of them, walking the streets with degrees in their hands…degrees from prestigious universities. They cannot find work. Why? These individuals view the conditions and circumstances that surround them as very frightening. They are the people who Eric Hoffer referred to who “are beautifully equipped to deal with a world that no longer exists.”

Look around, the world is definitely changing, and it will never be the same again. Power is slipping away, disappearing from some circles, and reappearing in others. Countries, companies and individuals who have held the power in the past are quickly losing it, if in fact, they have not already watched it melt in their hands. Their often smug, sometimes selfish, domineering, complacent attitude has cost them dearly. They are confused and this confusion is frequently fueled by their own ignorance. When that happens it ultimately leads to anger or resentment - sometimes both. This negative energy is then quite frequently misdirected, possibly at their loved ones, which then causes an entirely new set of problems.

These people are clutched by an unseen enemy and their frustration is endless because they are not sure what has happened or what is happening. Their world seems to be turning upside down.

The entire world is in the midst of a paradigm shift, which is unprecedented. There have been transitions in the past but nothing to equal what we are presently experiencing. The world is moving from an intellectual to a spiritual vibration. The rules for winning have changed dramatically and the majority of the populations are still living with the old rules. There are an enormous number of people in every community who have worked hard and disciplined themselves to follow the only rules they know…still they are losing. They are bewildered, confused and in many cases, angry and most feel their anger is justified, whether it is or not matters little. They are doing what they were taught by their parents, teachers, and employers. Unfortunately they too, were working with the old rules.

In the past, individuals were recognized and rewarded for what they knew. Corporations waited on the sidelines dangling monetary rewards attempting to attract the graduates from the big name universities of the world. There were the multi-million dollar MBA management development programs that corporations placed their hope in for years. Most everyone was conditioned to deify the intellect. Individuals were not properly recognized and rewarded for what they did.

Rather than focusing on what is or was wrong, we should let it go. Let the dead bury the dead. The world I grew up in is gone, forever. The world has changed. We live in the new era. This is a spiritual world governed by exact laws. Everyone who studies these laws and incorporates them into every aspect of their life will be richly rewarded. I believe we would be wise to go back to the promise Eric Hoffer shared, “In times of change, the learners inherit the earth.”

The learners are continually preparing themselves to adapt to the changes. Rather than reacting they are responding to these changes and they are responding in an appropriate manner. The learners are excited with the prospects of what this paradigm shift is bringing.

Bob Proctor

As a basic step of self-esteem, learn to treat as the mark of a cannibal any man’s demand for your help. To demand it is to claim that your life is his property - and loathsome as such claim might be, there’s something still more loathsome: your agreement.

Ayn Rand
Atlas Shrugged

“I hear all this bickering,” writes our last reader, “from readers about the Fannie/Freddie bailout and our current state of financial affairs. Sure, you can blame the Fed, the Congress, the president (and you’re right — it enabled this to happen for decades), but the fault lies with you all!!

“You, the American voter, continue time and again to re-elect these corrupt malcontents into office! Nancy Pelosi, Barney Frank, Ted Kennedy, Harry Reid, Charles Schumer, John McCain, etc., are all career politicians! George W. has served two terms! You, the people, keep re-electing career criminals to rob you of your life’s savings and destroy all hope of prosperity for your grandchildren. You, the people, in your apathy and ignorance shoulder ALL the blame for this mess.

“Why should career politicians change their ways? They have a great racket going. They are lining their pockets to the tune of millions. Until the people send a message by voting out at least 85% of the incumbents in Congress, NOTHING WILL CHANGE!”

From the 5Min. Forecast

- Breaking News -

INSIGHT BROADBAND DENIES ACCESS TO WEBSITES

September 8, 2008 9:10 PM (Cincinnati, Ohio) Insight Communications, a relatively small cable company that services parts of Kentucky, Southern Indiana, and Ohio, has unilaterally decided to deny its Internet cable service customers access to certain websites.

Our investigation has determined that Milktoast.info is one such website. This website specializes in educating credit card holders in the legal art of dealing with credit card banks, collection agencies, and collection attorneys. It teaches the ultimate defense: how to beat the banks in court.

Our conversation with an Insight customer service representative provided no reason for this draconian measure by Insight Broadband. Just a lot of evasive responses.

Based on the lack of response by the customer service representative to certain questions it does appear that outside pressure has been brought against the executives of the corporation to initiate this ban. By whom? We weren’t able to get a definitive answer.

However, based on the content of the website and its obvious success in teaching people how to eliminate their credit card debt, it is conceivable that the pressure was brought by an organized band of collection attorneys and their clients, the banks. This same group of profiteers has already lobbied Congress to change the credit card agreement laws to their benefit. The bill is currently before the House.

Evidently these profiteers aren’t willing to wait for Congress to act. They’ve found a quicker way to defeat their opponents. It may be cowardly; but, it is effective without bringing attention to them or their goals.

What happens next? Only time will tell.

We’ll keep you posted as the story unfolds.

- Update -

September 9, 2008 9:10 AM (Cincinnati, Ohio) A miracle or a coincidence?

But first, a little background. According to the owner of Milktoast.info his website is hosted in Malaysia to keep the website safe from the Gestapo tactics of the U.S. banking industry. These financial thugs have a tendency to use intimidation against U.S. hosting companies when they find a website they don’t like. The threat of withdrawing credit and calling loans is much quicker and more effective than having to prove your case in a court of law. Especially when your arguments have no basis in law.

So, before we wrote our original article we checked dozens of websites hosted in Malaysia to see if we could find any non-bank related websites in Malaysia that were banned. We couldn’t.

This morning we revisited Milktoast.info. It was accessible.

According to the owner, within two hours of his posting our original article to his website Milktoast.info became accessible. Just as quietly and suddenly as it was banned.

A miracle of a free press or a coincidence?

We don’t know. But, if you need this kind of help with your credit card debt we would strongly suggest you take advantage of this website while you still have the opportunity. It seems that information designed to help people has had a strange way of suddenly disappearing over the past several years.

Go figure.

“I don’t know the key to success, but the key to failure is trying to please everybody.”Bill Cosby
Actor and Comedian