Multnomah County to Vote on Suing Banks in the Mortgage Electronic Registration Systems
County Chair Jeff Cogen reaches out to explain the move and bolster support at this week's meeting
November 13, 2012This just in from Multnomah County Chair Jeff Cogen:
One of Multnomah County's many important functions is to gather, maintain and provide county residents with public records. Records of marriage, divorce, court matters, land ownership and more are all housed within our Recording Office for the use and benefit of the public.
For this reason, the Multnomah County Board of Commissioners will vote on a resolution at its Nov. 15 meeting that would initiate a lawsuit to be filed by the county against banks belonging to Mortgage Electronic Registration Systems, ("MERS") in the State of Oregon.
MERS is a privately held company that serves as a registry to electronically track ownership of mortgage loans nationally for the ease and convenience of large financial institutions like, Bank of America, JP Morgan Chase, HSBC, Merrill Lynch, among others.
MERS allows financial institutions to expeditiously transfer loans by circumventing public recording offices. Banks do not list themselves as the holder of a mortgage on county land records, and instead list MERS, creating a shadow recording system hidden from public view. Those quick transfers have enabled banks to package and sell mortgages to investors - the same mortgage packages that caused the collapse of our financial markets and what we now know as the Great Recession.
By using MERS to circumvent county recordings, these backdoor dealings have also cost the public significant losses in county revenue in recording fees - resources that would otherwise be used to bolster our numerous health and human services and support our most vulnerable county residents. Perhaps even more importantly, this non-disclosure by members of MERS has made it difficult for homeowners in Oregon to pinpoint who their actual mortgage loan is with and resulted in an inaccurate public record of what financial institution owns or has owned the mortgage loan on a given property.
When I took public office years ago, I made a pledge to always look out for how things affect our residents and taxpayers. Because Multnomah County maintains this record for the public benefit, we are obligated to ensure the accuracy of recorded information. We will take action against any entities that willfully do harm to the public record through the recording of false or misleading documents.
Our proposed lawsuit will not only call for a recovery of county recording fees dodged by the banks belonging to MERS, but reform to the system that has allowed these activities to take place and will seek to require MERS to restore the integrity of our public records.
Our board meets on Thursday, Nov. 15 to decide on this action. As always, our weekly board meetings are open to the public and take place at 501 S.E. Hawthorne Blvd. in Portland, starting at 9:30 a.m. To see a news report on MERS, click here.