Jackson Jambalaya

Tigerdroppings.com has a Saints board. Over 2300 members online right now.

It's that time of year and you know what it means: It's time for my award-winning egg nog recipe.

Ingredients: 1 cup bourbon 1 cup brandy 1 cup Tia Maria
12 eggs, quart cream, quart half & half, 1/2 lb powdered sugar
--------------------------------------------------------------------------------
Directions: Separate eggs and combine booze and yokes and
whisk in 1/2 lb of powdered sugar.
Store in fridge for 24 hrs. Keep the whites chilled also.
24 hrs later, whip cream in large bowl until thick,
then add half & half and the yoke/booze mix.
Add the egg whites and whip till frothy.
Chill for a while before serving.

Get blowed up.

While getting a shake from Brent's Drugs this afternoon, I learned Brent's should be open for breakfast starting in January. They have some more equipment which needs to be installed and then Fondren and Belhaven will finally have their own restaurant serving breakfast. Nice job and kudos to the new owners of Brent's who committed to growing its legacy.

A hearing was held today in Judge Swan Yerger's court on the Motion to Dismiss filed by Robbie Bell. Bell's motion was filed in response to the lawsuit filed against her by Elizabeth Hall. Post on Reponse to Motion to Dismiss, Post on Motion to Dismiss, Post on Bell lawsuit. Judge Yerger is instead treating it as a motion for summary judgment and giving both parties ten days to submit additional pleadings and evidence. Judge Yerger will then set a hearing date. Stay tuned.

Robbie Bell filed a Rebuttal to Plaintiff's Reponse to Motion to Dismiss November 24 in Hinds County Circuit Court. Robbie Bell is the mother of George Bell, III, who is serving life for murdering and sexually assaulting his girlfriend, Heather Spencer, and kidnapping her best friend, Elizabeth Hall, at gunpoint. Ms. Hall filed a lawsuit against Ms. Bell seeking damages for her conduct during George Bell's murderous rampage on September 11, 2007.

The two sides have filed the usual motions and responses in such a case. However, Ms. Bell filed an affidavit with the Court that makes a few new claims:

"2. At all times relevant hereto, George Bell III owned guns and had access to them.
3. When I came home on the night September 10, 2007, George Bell had in his possession onf his own guns.
4. Throughout the night and into the next morning, I was held captive by George Bell III and believed that if I did not do as I was told, George Bell III would kill me, others, and/or himself.
5. At no time relevant hereto, did I provide George Bell III with a gun or authorize him to use any gun owned by me or anyone else.
6. At all times relevant hereto, I had no control over George Bell III."

So if Ms. Bell was held captive, in fear, and knew George Bell III had a gun, why didn't she call the police when he left?

The Clarion-Ledger reported on the Steadivest case this morning, No new information for JJ readers but it did a pretty good job of covering most of the bases. Article

Meet King. He is at the Mississippi Animal Rescue League. Adopt him. Have a heart. How can you let a dog so beautiful be put to sleep or go homeless? Where is your sense of shame? Pretent you are a liberal and give this dog a home. Wait, I screwed up. If you were a liberal you would be taking my money and telling me you were setting up a program for someone else to give this dog a home but then after it was bid out to union only jobs and meeting all government regulations as well as passing the review for diversity qualifications and that the dog wasn't actually a threat to the environment, the poor dog would be dead because it would be ten years later before the home was finally available for the dog.

So give King a home. King's page

See sidebar on right for a collection of all posts on Evans case

Synopsis of Evans case (This feature will be included with future posts on Evans case): Charles Evans, Jr. was an attorney approved by Mississippi Valley Title Insurance Company to provide title certificates to MVT and lenders showing a borrower had clear title to property. MVT filed a lawsuit in September accusing his brother of using over 30 LLC's to obtain fraudulent loans from over 30 banks in Mississippi. Chris Evans would allegedly use one company to purchase a large tract of prime commercial real estate in Madison and Desoto Counties. Another company owned by Evans would obtain a commercial real estate mortgage on a smaller section of the tract yet that borrowing company never obtained a deed showing ownership of the land from the other company. Thus the smaller tract was actually non-existed as the larger tract was never actually subdivided. Charles would allegedly provide a title certificate however showing the borrowing company owned the land even though it didn't. Over 80 loans for nearly $50 million were issued by Mississippi banks to companies owned by Chris Evans for lands those companies either did not own. MVT has testified federal authorities are currently investigating the case. Chris Evans filed Chapter 7 bankruptcy on October 26, which stopped the Mississippi Valley Title's lawsuit against him as federal bankruptcy law stays most state civil court proceedings once a bankruptcy petition is filed. Mississippi Valley Title testified 65 title insurance claims for approximately $41 million have been filed by banks affected by the Evans case.


A hearing was held in U.S. Bankruptcy Court Monday on the bankruptcy petition for Chris Evans. Chris Evans has been accused by Mississippi Valley Title and several banks of conducting a massive scheme of real estate and mortgage fraud to obtain tens of millions of dollars in loans. JJ estimates 32 banks issued nearly $75 million in commercial real estate loans to Chris Evans.

A tidal wave of gray suits crashed upon the shores of the courtroom as bankers and lawyers wore the required uniforms. The only exception was Mr. Renfroe, an attorney representing Merchants & Planters, who borrowed from Alex the tweed blazer with elbow patches he wore in Family Ties. The courtroom was a stark contrast from the hearing in Yazoo held by Chancellor Harvey-Goree. That hearing was held on the same day as the day the Chancellor conducts her regular child-support hearings. The courtroom that day was Mississippi in a nutshell and surreal in nature: the first three rows were filled with grayed-up bankers and lawyers that looked like they came straight from the lily-white Country Club of Jackson while the last two rows were made up of poor blacks dressed in Walmart clothes seeking help just so they could take care of their kids that were in most cases, sitting right next to them. They looked bewildered as they sat in the courtroom for three hours while attorneys fought over the largest "alleged" real estate fraud ever in Mississippi.

The Court will likely order all properties sold.
Judge Olak made several rulings and recommendations in the hearing. One main issue in this entire case has been the title to the properties. Due to the (allegedly) fraudulent nature of the title certificates issued by Charles Evans, Jr., it has been very difficult for banks to determine who the actual owners of their collateral is because often the loans were given for tracts of land that did not actually exist.

Bankruptcy Trustee Derek Henderson said "it is so convoluted, it will be easier to sell the large tract than allow the bank to foreclose" as several banks have filed either requests to foreclose with the court or actions in chancery court to give them first lien position". Judge Olak agreed with the trustee and said he will probably order the commercial real estate owned by Chris Evans sold and then determine how the proceeds should be divided among the banks that have a claim on the property.

Judge Olak said he used this method in a similar case and that it was "successful" and that the "creditors needs to coordinate their efforts in order to maximize the value" of the property and that he "wanted to sell the property then worry about the proceeds later." Such a ruling will mean several prime pieces of commercial real estate in Madison and Desoto counties will be available for sale. Several tracts are on Highland Colony Parkway, Hwy 683, and Goodman Road.
Judge Olak said since many properties were worth less as separate tracts because they did not have access and that selling the larger "parent" tract would yield more money for the creditors.

The Court also ruled any creditor filing a claim on the property or proceeds from its sale, should provide evidence such as an appraisal or loan officer's testimony to support what it claims the value of the property is (Several banks complained about the cost of ordering appraisals as commercial real estate appraisals aren't cheap. This correspondent thinks the Court should have allowed Mr. Henderson to select an appraiser that would have independently determined a value without any potential conflict of interest that would have existed if he was selected by a bank.)

One of the more comedic moments was once again provided by Renfroe, who started to object to such a sale. The attorney said his bank had second lien on a tract of land and the value of the property was not even enough to cover either the first or second loan. It was comedic in that he wanted to foreclose on the property even though the tract was divided by a gas line, had no access, and his bank had second lien. The Court ordered Mr. Renfroe to work with the other banks.

The Evans case will be removed to Bankruptcy Court
Mr. Henderson told the Court he was going to remove the entire case to the bankruptcy court from the Madison County Chancery Court in the next few days. Judge Olak told Mr. Henderson he agreed with him and wanted to avoid "unnecessary duplication". Mississippi Valley Title had filed a request in the Chancery Court for the Chancellor to appoint a special master and asked for permission from Judge Olak to allow them to do so.

Such an appointment was objected to by the banks as it would have taken away some of their rights as creditors. The Special Master would have been the equivalent of a bankruptcy trustee at the state court level but for several differences. The trustee has more independence as well as more powers. He looks after the creditors' interest. He can conduct an independent investigation. He can audit and sell assets or discharge liabilities. The trustee can also investigate bankruptcy fraud and make criminal referrals directly to the justice department. A Special Master can make no such referral. A special master also can only rule on what the plaintiff's and defendants file in his court, something a trustee is not bound by under bankruptcy law. Theoretically, Mississippi Valley could more heavily influence the direction of the case if it was under the jurisdiction of a Special Master instead of a Bankruptcy Trustee unless the banks intervened in the case. Note: A more complete definition of a bankruptcy trustee is at the bottom of this post in an endnote.

Mississippi Valley caves in to the banks.
In addition to fighting Mississippi Valley on the issue of appointing a Special Master in state court, Cadence Banks and several banks represented by attorney Kristi Johnson of Watkins Ludlam filed several objections to motions filed by Mississippi Valley Title Insurance Company. These banks had extended nearly $10 million in loans to Chris Evans.

MVT sought an emergency 2004 examination of Chris Evans. Such an examination is a complete auditing of Mr. Evans' financial affairs. If the emergency request was approved, Mississippi Valley would be able to gain crucial information about the case before any other party could conduct its own examination. Such information is extremely valuable in determining strategy and getting a leg up on the banks in regards to filing motions and claims with the Court. The banks thus requested all interested parties be allowed to attend the examination. See earlier post on Banks v. MVT scrum

Mr. Henderson had objected to the Emergency examination as well and said that the banks should be able to participate. He told the Court Mississippi Valley Title agreed with their position that morning and that an omnibus exam should be held. The Court agreed and ruled an examination would be held on December 9, 2009 at 2:30 PM and another one the next day. He also ruled that parties that could not attend could participate via conference call.

The Court also granted requests made by several banks to foreclose on a home on Brecon Drive in Jackson. The home was renovated by Chris Evans and appraised for approximately $190,000. The banks however, issued loans for over $300,000 on the home as Mr. Evans obtained multiple mortgages on the same home and Charles Evans, Jr. once again provided the title certificate. The Court also ruled Bankfirst could claim a $100,000 cd belonging to Chris Evans it currently held.

Note: For those not familiar with bankruptcy law, here is the definition of a bankruptcy trustee according to Lawyers.com:
"In the course of administering or overseeing the debtor's estate (the debtor's property or assets), the trustee first investigates the assets of the estate, which typically includes holding the meeting of creditors and questioning the debtor at that meeting.
If there are assets of the estate that are neither exempt nor abandoned, the trustee must:

• Collect that property from the debtor or any other entity holding the property
• Convert it into cash, usually by sale of the property
• Be accountable for that property

A Mr. Frank Mickens is over at the Jackson Free Press complaining about bloggers and first proposed a licensing of journalists, for consumer protection of course, before Ladd disagreed with him, to her credit:
"Your first amendment arguments against creating a cadre of licensed, peer reviewed and ethically bound individuals known as Professional Journalists (P.J.’s) ring hollow in my ears.
The licensing requirements would create a separate class of professionals, who hopefully will be held in higher public regard than the current conglomeration of off the cuff bloggers and talking heads. It would force people like Rush Limbaugh and the Fox/CNN/MSNBC, etc news groups of crying, whining talking heads to be known as less than the best, by virtue of their inability to submit to and abide by a process of education, training, peer review, code of ethics and disciplinary risk.....
You cite that there are many organizations that offer journalistic guidance. In my opinion, what we need is a system of organizations (like state bar associations, professional engineering boards, medical licensing panels, etc.) offering standardized training and education requirements, qualified peer review, ethical requirements and disciplinary powers."

What do you propose Frank? Prosecuting people for engaging in the unauthorized practice of journalism? A licensing board that denies licenses journalists it doesn't like? The difference between a someone like Mickens and someone like me is I assume you guys have some brains and don't need any labels or certifications to decide if each post on this site is BS. I actually think you know how to tell the difference between facts, news, and opinions. People like Mr. Mickens think you are all stupid and unable to think critically so therefore you need to be protected from what he thinks are phony journalists. He should take is idea to Gannett. Their foundation would probably fund such a project. Can't imagine why, can you?

Vote for best divorce lawyer in Jackson. Have at it. ;-)

JJ readers voted Eric Clapton the best guitar player. Stevie Ray Vaughn came in second, Jimi Hendrix third. I disagree with the choice. Just listen to Layla, that is Duanne Allman playing the guitar. Now, Clapton has never played Layla that good or that fast live. As for Stevie, listen to Voodoo Child from the Live at the Fillmore album. Stevie never played that as good as Jimi did on that album, but I was outvoted. Nigel Tufnell over Jimmy Page and Carlos Santana? Come on.

The Mississippi Secretary of State's office began posting violations of Mississippi securities and charities laws and regulations on its website this week. Such postings will include Cease and Desist Orders and Consent Orders issued by the Securities & Charities Division. Jackson Jambalaya pointed out last month Mississippi was one of only eleven states not posting such information online. The SEC and FINRA post all violations online as well. The new section can be found here.

This is a very important development in protecting Mississippi investors and those who donate to charities. For too long investors have suffered because they were not able to easily see if potential scam artists had been disciplined by the state, as they could only file a public records request and wait fifteen business days for a response. Such a request assumes of course that the the investor already had a suspicion of violations in the first place.

A perfect example of how this website can help investors is the Steadivest case. The State fined Marshall Wolfe, one of the main principals in the Steadivest companies, $10,000 in 2005 and suspended his license for six months. The Cease and Desist Order spelled out how he sold unregistered securities in violation of state law and also violated the trust placed in him by two consecutive employers. A group of investors lost millions of dollars investing in his Steadivest Companies and are currently suing him and other defendants for allegedly defrauding them. (See sidebar at lower right for collection of all Steadivest posts.) Such information would have undoubtedly helped the investors make a better informed decision on whether to give their money to someone who had been disciplined for operating a similar scheme several years earlier. Unfortunately for them, Mr. Wolfe didn't learn anything from his previous experience as the State issued a Cease and Desist Order against Steadivest and named Mr. Wolfe as the main actor in committing fraud upon the investors.

This step by Mr. Hosemann's office is very welcome news in the fight for more transparency in Mississippi government and should be lauded by the business community as well as all Mississippians.

Someone adopt this poor little dog."Sammie was found roaming the streets near our shelter. A kind stranger picked Sammie up and showed her kindness for the first time in her life. Sammie is a kind, gentle puppy looking for that special someone to take her home!"

Look at him, scared and lonely. Sammie's info

JJ conducted a review of the loans issued to Evans-controlled companies in Texas. JJ calculated approximately $27 million in commercial real estate loans were issued by Texas banks and two Mississippi banks after reviewing deeds of trust. 19 loans were issued, 11 are now in foreclosure. The loans now in foreclosure proceedings are calculated to be $16,488,370 as more notes go unpaid. When the original post was made about the loans in Texas, only $12 million were in foreclosure.

See sidebar for a collection of all posts on the Evans case.

See section in sidebar for a collection of all posts on Steadivest.

The Securities and Charities Division of the Mississippi Secretary of State's office issued a Summary Cease and Desist Order against Steadivest on November 18, 2009. Copy of order. Steadivest is currently in Chapter 7 bankruptcy. Several investors sued Steadivest and several officers alleging they engaged in a scheme to defraud investors for several million dollars.

Steadivest is a collection of companies engaged in several activities related to real estate: mortgage lending, buying and selling properties, new construction, renovations, managing real estate portfolios, and selling promissory notes allegedly secured by real property to investors.
The Steadivest Companies and their officers are:
Steadivest Development: Marshall Wolfe (member)
Steadivest Capital, LLC: Marshall Wolfe (member), Patrick McCraney (registered agent), Jack
Harrington (member)
Steadivest Contrarian Fund: Patrick McCraney (member), Kelly Simpkins (registered agent)
Steadivest Properties: Marshall Wolfe (member), Kelly Simpkins (registered agent)
Steadivest Lending: Marshall Wolfe (member), Kelly Simpkins (registered agent)
Steadivest Resources: Jack Harrington (member), Kelly Simpkins (registered agent)

The order states Steadivest is a "holding company that offers real estate investment, property management, and bridge loan lending". Unfortunately for Steadivest investors, the State also said Steadivest was an elaborate "ponzi scheme". Steadivest sold shares to investors, raising $1,585,000 and spelled out to them in a Private Placement Memorandum (PPM).

A Private Placement Memorandum is "A legal document used in the private placement industry that gives investors details about a company’s business plan, investment information, and other pertinent details. Private placements are offerings of stocks or bonds that institutions or accredited, wealthy individuals may participate in, but which the public at large is excluded from." (Webster's)

The State initiated an investigation on May 26, 2009 after several complaints were filed with the Securities Division. The State found several violations.

Steadivest guaranteed the "investment funds would be held in escrow.... However, Steadivest failed to hold these funds in escrow." The State ruled Steadivest's actions showed "it had no intent to comply with the escrow terms" promised to investors. Steadivest would instead deposit the funds into its checking account where it was "commingled with Steadivest's operating cash" and that Steadivest used the investors' money to "pay bills and support the daily operations of the corporation."

Steadivest promised to maintain an open set of books that members could examine upon giving reasonable notice to the company. Unfortunately for the investors, Steadivest "never produced a single audited financial (statement)" and investors were never able to see the books.

The State stated Steadivest's presentations to the investors were of a "fraudulent nature" and that the escrow accounts were kept empty as the investors money was used to "prop up" the company instead of the intended purpose for the funds. Steadivest also used funds to prematurely pay off promissory notes held by Jack Harrington, a member of Steadivest.

Steadivest represented to investors the company was purchasing homes for a low price, renovating them, and then flipping them for a profit. The State said the figures used to show how this could make a profit for the company were "engineered solely for the purpose of fraudulently enticing investors." and that there were no profits made on these homes.

The Securities Division ruled "Steadivest mislead and deceived its investors in order to pay off mounting debt and keep its numerous subsidiaries afloat. In a "Robbing Peter to Pay Paul" Ponzi scheme, Steadivest mislead investors through a PPM (private placement memorandum which told investors where money would be spent) which Steadivest had no intention of honoring; through material misstatements of its CEO, Marshall Wolfe, and through material omissions in sales presentations and materials presented to its investors."

The State ordered Steadivest to Cease and Desist immediately from "further illegal activity". If Steadivest violates the order, the State can fine it up to $25,000 and imprison company officers up to five years in jail. Steadivest can request a hearing if it so desires.

It is also important to note several members of Steadivest were disciplined by the State in 2005. Marshall Wolfe was fined $10,000 and the State suspended his securities license for six months for selling promissory notes on real estate deals for MTW, a company he later owned (It was initially owned by his wife, brother-in-law, and Joel Travelstead. Wolfe later became a part-owner.) behind his employer's back to his clients. His employer, Bancorp South, discovered his double dealing, fired him, and reported him to the State. The Cease & Desist Order stated he committed the same violations while working for his next employer, Trustmark. The State ruled he sold unregistered securities and fined MTW Investments, an additional $10,000, as Wolfe sold the unregistered securities for MTW. Copy of earlier Cease & Desist Order

One investor, Bobby Isonhood, filed suit in August in Madison County Circuit Court against Marshall Wolfe. He obtained a default judgment which was entered against Mr. Wolfe on October 28, 2009 for $1,184,604. It is also unknown as to whether Mr. Wolfe or the officers of the Steadivest companies are the subject of any further investigation by federal or state authorities.

This post will be short and I'll write more later.

There was a hearing in Bankruptcy Court today as a sea of gray suits flooded the courtroom. Here are some quick notes taken during the proceedings:
*The judge stated he will probably order all of the "parent" tracts of land sold and then work out how to split the proceeds of each sale among the banks claiming liens on portions of each tract.
*MVT caved against most motions or responses filed against it by the trustee, Derek Henderson, Cadence Bank, and the Kristi Johnson Group: State Bank, First Bank, Bank of Forest County, & Holmes County Bank
*Judge Olak and Mr. Henderson stated that the entire action in Madison County Chancery Court will be removed to the Bankruptcy Court in the next few days
*Neither Evans brother appeared in the courtroom.
*Mr. Renfroe of Merchants & Planters Bank provided the comedic moment of the day when he attempted to foreclose on a property even though 1. His bank had second lien on the property, 2. the value of the property was less than the amount of either lien, 3. The property was cut in two by a gas line and had no access, and 4. He had no clue what the value of the parent tract was or who the other banks involved were. In effect, the property was almost worthless without any access.
*MVT dropped its "emergency" attempt to conduct its own examination of Mr. Evans finances and the assets and liabilities involved. Instead two examinations will be held that are open to all of the creditors.
*No title insurance claims were addressed.

Copy of Order

Well, Charlie Mitchell, Executive Editor of the Vicksburg Post, wants Mississippi to implement an internet sales tax. He opines:
"Through 2007, a University of Tennessee study showed Mississippi had already lost out on $624 million in sales taxes on e-commerce and would miss out on another $462 million in 2008. Online holiday retail sales will grow 8 percent this year to $44.7 billion nationwide, predicts Forrester Research. Mississippi is losing about $500 million this year - or about 7 percent of all sales taxes due.
An interesting aspect of that number is that it's approximately equal to the amount the state budget is predicted to fall short by the end of June.
There's nothing the Legislature in Mississippi or any other state can do about this. Only Congress can change the law..." Column

However, there is one little thing Mr. Mitchell leaves out of his love letter to the tax man: newspapers are exempt from sale taxes:
"The tax levied by this chapter shall not apply to the following:
(b) Sales of daily or weekly newspapers, and periodicals or publications of scientific, literary or educational organizations exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code of 1954, as it exists as of March 31, 1975, and subscription sales of all magazines." Section 27-65-111 of the Mississippi Code.

Perhaps Mr. Mitchell should lead by example and lobby for his own taxes to be raised before he raises our taxes instead of mooching off of the rest of us.

Beck last week discussed the dollar carry and how our deficit financing and devaluation of the dollar are going to impact the economy. Yes, I know, some of you will say its Glenn Beck and he gets out there at times. However, when he is on, he is really on. His two shows on the housing crisis and how Goldman Sachs has gamed the system explained those two issues better than anything else I've seen. Even some liberal friends had to admit he was on the money. Grab the beer and popcorn and enjoy.

List of FHA-approved condo projects in Mississippi on FHA's website.


Last week's fight over the Mandalay project highlighted a problem more condo developers are facing: How are homebuyers going to finance a condo purchase in a new development? While Fannie Mae seriously injured the ability of developers to sell new condos by requiring no person or entity can own more than ten percent of the units in a project, developers still had refuge in the arms of FHA, which had easier underwriting guidelines for condos and insured mortgages up to $271,000 (in Mississippi) to borrowers.

Unfortunately, FHA is about to tighten the rules for condos. Housingwire.com reports unless condo projects were approved by FHA in the last 13 months, all projects have to get re-approved by FHA. However, the deal-killer are the limits on how many units a developer can own:
"one investor may own no more than 10% of units. For two and three unit projects, no single investor may own more than one unit.

No more than 15% of the total units can be more than 30 days past due on their condominium association fee payment. At least 50% of the units must be sold before any mortgage on a unit can be endorsed. However, the FHA will temporarily reduce the pre-sale requirement to 30%.

Next poll: Top divorce attorney in Jackson. So far my list is: LC, John Reeves, Chinn, Varnado, William Wright, Monte Caldwell, Lee Agnew, Chris Tabb, and Bill Featherston. Very incomplete list so feel free to make suggestions.

Congrats to Ole Miss yesterday. It would be so tempting to blame the loss to Ole Miss on the complete stupidity of Les Miles and Gary Crowton yesterday. The examples are almost too numerous to list. Passing the ball repeatedly after getting into field goal range with a minute to go, letting 17 seconds or so run off the clock before running the last play, letting another 26 seconds pass by when the FG unit could have been running on the field so T-Bob could snap the ball when the whistle blew, the onside kick in the first half, running the same stupid play twice for a two point converstion, or the inexcusable play calling by Gary Crowton. The last minute of the game was one for the ages as shown in this video:



But I'm not going to put the blame on Les Miles. Ole Miss came out ready to play and in the second half, they looked like they wanted it more while most of the time, LSU looked like it was going through the motions. LSU never could figure out how to stop the Ole Miss blitz and Ole Miss whipped LSU's line on both sides of the ball. Hard to beat a fired up team like Ole Miss when your quarterback looks clueless, linemen are getting dominated, and receivers are repeatedly dropping the ball. Ole Miss got the win because they wanted it and they earned it. They gained nearly 500 yards in total offense and except for the Hail Mary play, held LSU to just above 200 yards. They made fewer mistakes and were more physical. That will usually guarantee a win 99% of the time.

Meanwhile, the Ole Miss fans should enjoy seeing this make the top story on Yahoo. The Sports Reporters on ESPN this morning were laughing about it and its made it all over the web. Couldn't have been scripted any better for the Rebels. Congrats to the Rebels.

Now some fans unfortunately focus on things like the score while overlooking what was more important yesterday: LSU moved up from 107 to 106 in the NCAA rankings in offense. This can not be over-emphasized as it shows LSU is improving on offense and the young players are finally figuring out Crowton's system and implementing it. The future indeed looks bright for LSU's offense and LSU football if yesterday was any indication.

And there arose to the north of Eden a tribe called the Hotty-Toddys, who were also called metros. And the Hotty-Toddys were very displeasing; they didst place centerpieces on their banquet tables, and didst exalt themselves much. And they didst glorify the southern kingdom of the past.
And for a brief time they didst enjoy success on the battlefield. But in the second year of the reign of John son of Joseph, a man named James, of the house of Meredith, of the nation of Cush, didst attempt to enter the seminary at Oxford. But the Hotty-Toddys despised and oppressed the Cush-ites, and refused him entry. But the Judges decreed that James must be allowed to enter. And the Hotty-Toddys rose up with great vengeance and furious anger, and didst burn their own city, and even slew two aliens in their midst. And the LORD saw that it was no good, and was much angered, and uttered a curse upon the Hotty-Toddys:

"THOU SHALT TASTE VICTORY ONCE MORE, THEN NEVER AGAIN SHALL THOU BE FIRST AMONG THY BRETHREN"

And after the following harvest, they didst enjoy their last great victory, then their warriors became lost in the wilderness. And a man named Elisha, who was also called Archie, didst attempt to lead them back to glory, but was wounded in the land of Eden and tasted not the fruits of victory. Then a great famine fell upon Oxford, until Eli son of Archie arrived upon a white horse. Eli led the Hotty-Toddys to many small victories, and girded his loins against an invasion by the warriors from Eden.

But Eli fell backwards*. And a great roar arose, and Johnny of the house of Vaught, the great king of the Hotty-Toddy past, didst ask "What be the meaning of this tumult?" For Johnny was a very old man, 93, and nearly blind. And the Hotty-Toddys cried in despair, "The invaders from Eden hath carried off the West championship! Our curse is still upon us, and the Heisman shall never come to the house of Manning."

And the LORD then caused a great delusion to fall upon the tribe of Hotty-Toddy, and they drove their general David from their midst, even though David had led them to victories for the first time in forty years. And they chose a recruiter of warriors from a western land, Bay Bay of the house of Yawyawyawyaw, because their delusion kept them from seeing he was a fool. And Bay Bay disdt tear his garments, and shout words none could understand. And the LORD loosed against the Hotty-Toddys bands of Cowboys, and Bulldogs, and even Commodores, who laid waste to Oxford. And the Hotty-Toddys continued to exalt Bay Bay, even as half his warriors disappeared from Oxford, and rued the days of Cutcliffe. And finally Les of Eden came to Oxford and destroyed it once and for all.
1 Samuel 4:3

OK, Ole Miss kicked our ass last year fair and square. I figured they would and it was one of those times I wish I wasn't right. They laid the wood pretty thoroughly to LSU. I'm calling today a tossup. LSU's defense is much improved but their ability to stop the run up front has been suspect. I like our matchup of Peterson and Jones against Snead and if they can get in his head early, LSU can win. McCluster has a big day, watch out. If I was Nutt, I'd run McCluster until they stop him. Ole Miss defense is pretty good and LSU has a weak O-line and Jefferson has not exactly been a model of consistency at the qb position. The starting rb and tight end are out, leaving the running game to Keiland and Ridley. Of course, LSU has its own McCluster in Russell Shepard but unfortunately, Crowton is too busy trying cute little plays and options instead of figuring out how to properly use him.

Prediction? LSU by 2.

Middle East Media Research Institute (MEMRI) reports on how the Diary of Anne Frank is seen in Lebanon:
"Reporter [holding the book]: "This is the book that is taught in several schools in Beirut, which recounts the diary of an Israeli [sic] girl during World War II. Let’s delve together into the details of this diary.

"There is an entire chapter, titled 'Drama,' at the top of which there is a Star of David, along with clarification measures not found in other chapters, which aim to focus on the notion of the persecution of the Jews during World War II. Even worse than this is the dramatic way in which this diary is emotionally recounted."

This Book "Is Definitely in Violation of the Penal Code"

Naim Kalaani, chairman of the Authority for Banning Zionist Products: "Such a book is definitely in violation of the penal code. This is clearly a violation, and they must be prosecuted. This is tantamount to running towards normalization. The prosecution must automatically take action, because this is a criminal offense taking place in a school.....

Hizbullah MP Hussein Al-Hajj Hassan: "Nobody teaches from a textbook without checking its content first. These respected schools teach the so-called 'tragedy' of this girl...."Article

Adopt Nika at the Mississippi Animal Rescue League. 601-969-1631

Santelli and the Fed Pimp go at it over the Fed.

Synopsis of Evans case: Charles Evans, Jr. was an attorney approved by Mississippi Valley Title Insurance Company to provide title certificates to MVT and lenders showing a borrower had clear title to property. MVT filed a lawsuit in September accusing his brother of using over 30 LLC's to obtain fraudulent loans from over 30 banks in Mississippi. Chris Evans would allegedly use one company to purchase a large tract of prime commercial real estate in Madison and Desoto Counties. Another company owned by Evans would obtain a commercial real estate mortgage on a smaller section of the tract yet that borrowing company never obtained a deed showing ownership of the land from the other company. Charles would allegedly provide a title certificate however showing the borrowing company owned the land even though it didn't. Over 80 loans for nearly $50 million were issued by Mississippi banks to companies owned by Chris Evans for lands those companies either did not own. MVT has testified federal authorities are currently investigating the case. Chris Evans filed Chapter 7 bankruptcy on October 26, which stopped the Mississippi Valley Title's lawsuit against him as federal bankruptcy law stays most state civil court proceedings once a bankruptcy petition is filed. Mississippi Valley Title testified 65 title insurance claims for approximately $41 million have been filed by banks affected by the Evans case.


Apparently Mississippi Valley Title Insurance Company is now fighting a three-front war in the bankruptcy case of Chris Evans. Mississippi Valley Title filed an Emergency Motion for a Rule 2004 Examination of Debtor on November 16 seeking an examination on November 20, 2009. Under Rule 2004, the Court may order an examination of "the acts, conduct, or property or to the liabilities and financial condition of the debtor, or to any matter which may affect the administration of the debtor's estate, or to the debtor's right to a discharge." Federal rules of bankruptcy

Mississippi Valley Title claims in its motion that Chris Evans filed bankruptcy as a delaying tactic against the lawsuit alleging fraud Mississippi Valley Title filed against him in Madison County Chancery Court. MVT argues "Debtor is also the subject of a criminal investigation by the FBI and other investigative government bodies for Debtor's fraudulent conduct. Based upon this criminal investigation, Movant expects that Debtor will likely exercise his Fifth Amendment rights and refuse to answer any questions in the Rule 2004 Examination. It is imperative that Movant determine if that is the Debtor’s position because it will be necessary for the Debtor to be granted immunity under Section 344 of the Bankruptcy Code prior to the first meeting of creditors now scheduled for December 9, 2009. Otherwise, the Debtor will have succeeded in further delay of investigation into his fraudulent content."
Copy of motion

Derek Henderson, the trustee appointed for the case, stated he had no objection to an examination and that "such an examination will ultimately be required". Unfortunately for MVT, Henderson states he "fails to see the emergency nature of the motion" and provides several reasons to support his position. Copy of Trustee's response

The trustee also attempts to stop Mississippi Valley Title apparent attempt to use the 2004 motion to settle the title issue for the properties allegedly used by the Evans brothers to perpetuate their fraud. This is crucial because many loans were issued by 32 banks in Mississippi on properties in Madison and Desoto Counties owned by the Evans brothers. In most cases the certificate of titles issued to Mississippi Valley Title and the lenders by Charles Evans, Jr., were said to be fraudulent, thus leaving the banks with no collateral and MVT at risk of paying millions in dollars in claims to the lenders. In many cases, the same tract of land had multiple loans issued on it by several banks that had no knowledge of the other loans. Thus, the title issue is very important to everyone involved in this case. The banks thus have a strong interest in an examination or court determining who has title to these properties and aren't going to be too crazy about an sudden examination held in their absence.

Mississippi Valley also asked the Court to to meet with MVT in the Examination and fix the title problems on the properties at issue in this case. MVT stated it "has also requested Debtor, both individually and in his capacity as an officer, manager, or member of various entities, to execute curative real property deeds in an effort to merge equitable and legal title."

The Trustee said he would oppose any such action by Evans and that it would "only cause possible adversary proceedings in the bankruptcy case as to preferences and/or fraudulent transfers.' (Translation: Some banks are going to see this as a power play to screw them and we aren't going to go there.) The Trustee asserts that it is better to leave the property issues at status quo until a complete investigation can be done..." Mr. Henderson warned MVT he would take this position in a letter dated November 9, 2009. Copy of letter It should be noted Cadence Bank filed a joinder petition with the Court supporting the Trustee's action.

Several banks filed objections to some of the motions filed by Mississippi Valley Title and other banks. Mississippi Valley filed a motion on November 6 asking for permission to pursue its fraud lawsuit against Chris Evans in Madison County Chancery Court. Copy of motion. First State Bank, Bank of Forest, Holmes County Bank, and State Bank & Trust objected to this motion on November 17, Copy of objection, and argued the bankruptcy court should decide this matter, not the state court.

Its not hard to see why the banks are objecting to Mississippi Valley Title's request that it be allowed to pursue the fraud case against Chris Evans. MVT requested the Chancellor appoint a Special Master to preside over the case which would in effect replace the Trustee in all but name only. The banks as creditors have more rights in the bankruptcy court and are able to file their own claims and motions. If the Court grants permission to MVT to proceed with its case against Chris Evans, the banks are reduced to the role of cheerleaders hoping Mississippi Valley Title is looking out for their interests in state court unless they intervene. It should also be pointed out that in bankruptcy court the Trustee has powers not available to the Special Master and can also prosecute bankruptcy fraud if discovered. It is pretty clear to see why some of the banks are not to comfortable with MVT's attempt to have the case removed back to state court.

These banks also objected to Mississippi Valley Title's emergency request for a Rule 2004 examination. They argue an examination should be held but it should be at a time and place where all of the banks have an opportunity to participate if they so desire. Copy of objection to 2004 motion

Cadence Bank also jumped into the fray, filing its own motion opposing Mississippi Valley Title. Cadence claimed it had $4.6 million at stake and that it couldn't understand exactly why Mississippi Valley Title was trying to force an examination so quickly and without the other banks present. Cadence agreed with State, First State, Holmes, and Forest and asked the Court to order an examination "far enough in the future" so all interested parties could participate. Copy of Cadence's objection to 2004 motion

There is one further issue that should be considered. Has Mississippi Valley Title actually paid any claims? The insurance company stated 65 claims worth over $41 million were filed against it by policyholders affected by the Evans case. In his motion to dismiss, the lawyer for Charles Evans, Jr., argues Mississippi Valley Title has suffered no harm and can't sue for suspected "future" injury. A fundamental rule is that before a party can recover for damages, it must first show injury to the court. MVT has not stated how much money it has paid in claims, if any. So the question must be asked if Mississippi Valley Title has actually paid any claims so far in the Evans case.

The Evans-izer Bunny, it just keeps going....and going.... and going....

Jackson crime statistics for November 9-15, 2009.

See sidebar on right side of page for a collection of all posts on Evans case

Copy of affidavit
Exhibit A: Itemized list of loans issued to Evans brothers filed by MVT
Exhibit D: copy of title certificate issued to MVT
Exhibit E: Copy of title certificate issued to MVT

Mississippi Valley Title Insurance Company filed the affidavit of Brad Jones in the bankruptcy case of Chris Evans on November 17. The affidavit provides the testimony of Brad Jones, an employee of MVT who provides specific details on how Charles Evans, Jr. and Chris Evans allegedly perpetuated a fraud upon Mississippi Valley Title and many banks. Mississippi Valley also reveals that claims in excess of $41 million have been filed against it by affected lenders.

Mr. Jones is a lawyer, CPA, and certified fraud examiner. Mr. Jones states Charles Evans, Jr. was "an approved attorney for Mississippi Valley Title, although not retained, hired, or employed by Mississippi Valley Title." MVT and its lawyers have consistently pointed out this fact at every step of this case. Evans was authorized to "provide title certificates to MVT".

A title certificate is important when obtaining a loan on a property. The certificate allows the borrower to show the bank he is indeed the true owner of the property and also tells the bank there are no other liens on the property. If liens are missed, either the title insurance company has to pay them (the lienholders had a valid claim on the property when it was sold, and thus the proceeds of the sale) or the bank finds out it doesn't have the first lien on the property (thus it may be unable to recover the loan if the borrower defaults). This is important as banks will not provide a loan on property unless there are no other liens, or the other lienholders have agreed in writing to subordinate their claim to that of the bank.

The most crucial part of the affidavit states Chris Evans, Charles Evans, Jr., "and others entered in concert in a fraudulent and/or criminal scheme to defraud MVT and Lenders by borrowing funds from Lenders using certain land as collateral when title to the collateral was not of record in the landowner."

"As a part of the fraudulent scheme.. (the Evans brothers) would misrepresent to the Lenders and MVT that the land was owned by an entity controlled by Jon Christopher Evans and/or Charles H. Evans, Jr."

Crucial because without the issuing of phony title certificates, such a scheme would not work as banks would not lend money and MVT would not issue insurance policies. Jones testifies "based upon the false title certificates... and title insurance commitments issued by Mississippi Valley Title, Lenders would advance funds to Jon Christopher Evans, Charles H. Evans, Jr., and/or others."

The other crucial point about this case is that "contrary to representations made by Charles H. Evans, Jr., in title certificates, record title to the subject property was never transferred into the entity that actually borrowed the funds and whose title was insured."

In plain English, Mr. Jones is stating that one Evans company would buy a tract of land, another Evans company would borrow money on it, but the company that bought the land never transferred the land to the company that borrowed the money. However, the title certificate issued to the bank and MVT said it did own the land even though in reality the other company did.

A simple analogy would be suppose I took your car and got a loan on it from a pawn shop. The pawn shop asks me for a copy of the title so I give them one I forged. Unfortunately for them, the title is still in your name but they don't know that little fact. I get money on the car, don't pay back the loan, then the pawn shop finds out its not my car and can't repossess it.

Mississippi Valley stated in Exhibit A (listed above, compare it to this earlier post) that as of November 17, 2009, lenders have filed 65 title insurance claims with Mississippi Valley on loans granted because Charles Evans, Jr. issued (allegedly) phony title certificates. Mississippi Valley states the total amount of the claims is $41,415,242 (JJ estimated the banks exposure in Mississippi at $47 million. Not bad.) Paying these claims will wipe out much of Mississippi Valley's claims reserves. However, Old Republic, its parent company, has reserves of several hundred million dollars and is able to cover any claims Mississippi Valley must pay. Old Republic Q3 earnings statement

The affidavit also lists several large tracts purchased by an Evans company in Madison County: 38 acres on Highland Colony Parkway and 84 acres on Park Place Boulevard. It is also important to note that not all loans were gained through fraudulent title certificates and that the banks losses are probably larger than the amount stated by Mississippi Valley, as the assets of Charles H. Evans, Jr. are frozen and Chris Evans is in bankruptcy, thus the remaining loans will probably enter into default. It is also worth remembering Texas banks issued approximately $27 million in loans as well and that nearly half of these loans are now in foreclosure. The Evans case is like the Energizer Bunny.... it just keeps going...and going.... and going.

This fine lad managed to earn himself a suspension from his fraternity at Ole Miss.

Have at it.

Hallmark Cleaners was robbed this morning. A punk walked in this morning before the security guard was on duty and robbed the dry cleaner's by showing a knife. No one was injured in the robbery.

See sidebar on right side of page for collection of all posts about the Evans case.

Copy of amended complaint
Copy of answer
Motion to dismiss

The Evans slugfest continues in the Madison County Chancery Court. Mississippi Valley Title Insurance. MVT filed an amended complaint on November 6.

MVT spells out in more detail the connection it had with Charles Evans, Jr. and expanded the list of defendants to include more companies owned by Chris Evans. The amended complaint states he "was an approved attorney for Mississippi Valley Title, although not retained, hired, or employed by Mississippi Valley Title." and that "approved attorneys provide title certificates to MVT which are intended to represent the true status of title on a particular property."

Title insurance is required by lenders for mortgages so as to protect their collateral. The title insurance includes a certificate of title that tells the lender the borrower owns the land on which he is borrowing money. Without clear title, the mortgage becomes an unsecured and thus riskier loan.

MVT states Charles H. Evans, Jr., issued title certificates for "over 100 title insurance policies" underwritten by the insurance company and that he "misrepresented the true ownership and encumbrances upon certain land in title certificates provided to MVT for the benefit of Jon Christopher Evans and/or other defendants".

An investigation by JJ reveals that what apparently took place was companies owned by Chris Evans would buy prime pieces of commercial real estate in Madison and Desoto counties. However, another company owned by Evans would obtain large commercial real estate loans on each property. Each property had several loans issued on it even though the company borrowing the money didn't actually have title to it as the company that bought the land still held the deed to the property. The Evans brothers used this method to obtain nearly 100 loans from over 30 banks in Mississippi. JJ estimates the total amount of exposure to the banks is $47 million.

However, MVT claims Charles Evans, Jr. would issue a certificate of title to MVT stating the company borrowing the money owned the land. Page nine reveals specific details about how the alleged fraud took place. MVT further states "Defendants have improperly and fraudulently obtained tens of millions of dollars through their common scheme and fraudulent acts."

MVT charges the defendants with nine counts that they have violated a court order requiring them to convey land or cure the title defects. MVT asked the Chancellor to appoint special master to oversee the case. However, Charles Evans, Jr. is apparently fighting back as he filed an answer and a motion to dismiss to MVT's complaint.

Evans argues the suit should be stayed as its related to the recent bankruptcy filed by Chris Evans. He makes the standard defenses: venue is improper, no jurisdiction, complaint fails to state a claim upon which relief can be granted, no standing, statute of limitations expired, and so on. Evans also accuses the plaintiffs of having "unclean hands" and that their "own conduct" caused their problems.

Charles Evans, Jr. then filed a motion to dismiss. Evans posits MVT did not suffer any injury (the premise probably being that since MVT has not paid any claims, it thus did not suffer any injury which is required to prove fraud.) and that the "Plaintiffs have placed the cart before the horse."

The slugfest continues.

JJ just conducted a poll on who the next Sheriff of Hinds County should be when Mac retires. Former JPD chief Robert Johnson won the poll, followed by Steve Pickett. Apparently more than a few people remember his tenure as Chief of JPD.

Meredith Whitney tells CNBC we were never really out of recession and are heading back into one, something that should not surprise regular readers of this blog.

The fight between local developer Steve H. Bryan and Reservoir homeowners continued yesterday as they squared off at the office of the Pearl River Valley Water Supply District Board. The Clarion-Ledger reported:
"Originally billed as a condominium project in February, the Mandalay development now plans to rent apartments and eventually convert them into owned properties, developer Steve Bryan told committee members today" and that "Bryan announced in September that the units — which will range from 900 square feet to 1,400 square feet — will have monthly rents starting at $1,000. Bryan said the units will be among the most luxurious in the metropolitan area." Article

Mr. Bryan, who has lost several complexes and projects to foreclosure this year, even went so far as to say "Our proposal, as you all are aware we were starting with a lease purchase program from the beginning. That has never changed. It must meet Fannie Mae guidelines," said Steve Bryan." WLBT story with video

Really? Lets see what those guidelines are. According to Fannie Mae guidelines, the appraisal has to show what rents are for other apartment complexes in the area. A market value rent is determined based upon these complexes. The renter can only use the difference between his rent and the market value rent on a lease-purchase transaction. Thus if someone rented a unit at Mandalay for $1000 a month, and the market value rent for that apartment was $900 a month, he could only use $100 a month towards his down payment.

Fannie Mae states in its guidelines "A project is ineligible if Projects where a single entity (the same individual, investor group, partnership, or corporation) owns more than 10% of the total units in the project (p. 535)" and that "at least 90% of the total units in the project have been conveyed to the unit purchasers (p. 549)".

This is a deal-killer for projects such as Mandalay because before Fannie Mae will finance any lease-purchases in the project, Mr. Bryan will first have to sell 90% of his units. Does anyone think there will be several hundred renters that won't need a mortgage to buy a Mandolay condo?

However, Fannie Mae is not the only consideration as the anytime a borrower has to put down less than 20% on a home, he is required to obtain mortgage insurance. The Mortgage Insurance companies have their own guidelines for projects such as Mandalay.

RMIC (Old Republic, yes, that Old Republic of Evans fame) states in its underwriting manual:
"Resales of converted condominium units from apartments, warehouses, etc. are eligible for RMIC insurance only if all the units have previously been sold to individuals other than the developer, and the project has been turned over to the HOA. Additionally, the appraiser must demonstrate market acceptance by using comparables that are resales from the subject project." Page 29 of RMIC's underwriting guidelines.

MI (mortgage insurance) underwriting guidelines are usually more strict than Fannie Mae guidelines. RMIC states "Only the portion of the lease amount in excess of the Fair Market Rental can be used for down payment" and that "Borrowers must make an initial down payment of 5% from their own liquid assets before the rental credit can be applied as equity." (page 21).

MGIC, the largest mortgage insurance company, is just as tough on lease-purchase deals. MGIC states on page 66 of its underwriting guidelines "In a “lease with option to buy” situation, only the portion of the lease/rent payment in excess of market rent is acceptable as a borrower’s down payment."

Lease-purchase transactions are also treated as a refinance by most lenders and Fannie Mae. The maximum loan-to-value for a refinance is lower than it is for a purchase, thus Mr. Bryan's renters will still have to come up with 5% down if they want to purchase one of his units even if they can use part of their rent towards the down payment. MGIC underwriting guidelines.

Mr. Bryan's public statements about Mandalay meeting Fannie Mae guidelines simply don't square with the underwriting guidelines of Fannie Mae and the mortgage insurance companies. . In order to meet Fannie guidelines, Mr. Bryan will have to first convert the entire project to condos, then sell 90% of it to homebuyers who won't use a mortgage from Fannie Mae to purchase the home. If he can get past that hurdle, then his renters can only use a portion of their rent, if any, towards a down payment and that is after they have saved enough money to meet the 5% down payment requirement by the mortgage insurance companies. In other words, if Mandalay is built as an apartment complex, it is probably going to stay an apartment complex.

It should also be noted Bankplus issued a loan to Mandalay Development for $1.75 million on February 19, 2008. The note became due six months later but the bank has obviously extended the note even though no modification has been recorded at the courthouse. The Secretary of State's website reveals Mr. Bryan is listed as a registered agent for the company but no one is listed as owner or member. The deed of trust refers to him as a member of Mandalay Development LLC. The articles at the SOS probably have not been updated, which is not uncommon.

Mr. Bryan has already suffered several severe financial reverses this year as he lost several complexes in foreclosure proceedings in various states and was fined by HUD as well.
If the project suffers the fate of other Bryan developments this year, will the site become another Harborwalk: an asset to the Reservoir area torn down by developers who bit off more than they could chew?

Earlier post on Mandalay Development controversy

See sidebar at right for collection of all posts on the Evans case

The Mississippi Business Journal reports today:
"Phone books published by a Jackson company — operating in a building owned by a man being sued for alleged commercial real estate fraud — were due out in June but have not been delivered to the public due to nonpayment to the printer. Furthermore, ad sales representatives for the company are continuing to sell ads for more books that the company may not have the money to publish...."

Unfortunately, it appears the advertisers are not the only ones who might be victimized in this deal:
"A Utah printer said the bill for more than 45,000 Rankin County phone books that was due in April still has not been paid.
Gulf States Directory Company is currently selling ad for Metro West Jackson and Madison County phone books, promising they will be out in early 2010...." Article (Includes picture of Evans).

Great job by Ms. McCullough. Now we are seeing some real business journalism here in Jackson. A big thank you goes to you, the readers of this website. Some of your comments last week about Gulf States are what tipped her off to this story. Hopefully, the advertisers and printer can get together and figure something out that will mitigate their losses.

That bastion of right-wing radicalism, the Village Voice, published a story a year ago that discussed how Andrew Cuomo forced Fannie Mae and Freddie Mac to engage in subprime lending while he was Secretary of HUD:

"Andrew Cuomo, the youngest Housing and Urban Development secretary in history, made a series of decisions between 1997 and 2001 that gave birth to the country's current crisis. He took actions that—in combination with many other factors—helped plunge Fannie and Freddie into the subprime markets without putting in place the means to monitor their increasingly risky investments. He turned the Federal Housing Administration mortgage program into a sweetheart lender with sky-high loan ceilings and no money down....

In 2000, Cuomo required a quantum leap in the number of affordable, low-to-moderate-income loans that the two mortgage banks—known collectively as Government Sponsored Enterprises—would have to buy....

Franklin Raines, the Fannie chairman and first black CEO of a Fortune 500 company, warned that Cuomo's rules were moving Fannie into risky territory: "We have not been a major presence in the subprime market," he said, "but you can bet that under these goals, we will be."...

When HUD released the next set of goals in 2004, it reported that after Cuomo's previous edict, there had been a sudden spurt of GSE subprime investment, "partly in response to higher affordable-housing goals set by HUD in 2000." Fannie had gone from $1.2 billion in subprime-mortgage and securities purchases in 2000 to $9.2 billion in 2001 and $15 billion in 2002. Freddie's numbers were murkier, but clearly also on the rise. In 2003 alone, the two bought $81 billion in subprime securities—which also count against the goals...." Article