#complaint for loan fraud

[legalmagnifier]

Register Your Consumer Complaint

A person who buys any goods or services for a consideration, which has been paid or promised or partly paid and partly promised, or under any system of deferred payment also includes the user with approval of such goods or beneficiary of services. As per Consumer Protection Act 2019, the expression “buys any goods” and ‘hires or avails any services” includes offline or online transactions through electronic means or by tele shopping or direct selling or multi-level marketing.

Know More : https://www.legalmagnifier.com/services/consumer-complaint

[thetaxguyin]

ED Provisions: Immovable Properties Worth ₹43.84 Crore Attached in PMLA Cas

The Enforcement Directorate (ED) in Mumbai recently made a significant announcement regarding the provisional attachment of immovable properties, including several floors of Hotel One Continent in Hyderabad. Valued at ₹43.84 crore, these properties have been provisionally attached under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, in connection with a loan fraud case…

[meandmybigmouth]

Anyone notice the biggest complaint from GOP is that someone who doesn't deserve money or help from the government get's it!. Meanwhile the GOP government has so many programs that benefit the rich and corporate America and they and trump deleted millions of PPP red flag loans during trump's nightmare stay in the White house?

Make it make sense! and investigate trump's and the gop" handling of the Covid Pandemic and dispensing of 8 trillion dollars!

[mysticstarlightduck]

Villain Crimes Tag!

Let's go with the main villains from What Lurks In The Hollow for this one. Again: given that this is a post about very, very bad people (after all they are the villains of this WIP) it will contain TWs for some pretty nasty things.

Rules: List all the real-world crimes your villains are guilty of committing!

Mayor Samuel Whitaker

Serial Killings/Multiple First Degree Murders (most of the victims were minors, ages 5-17, but some adults as well)

Demonic Rituals + Ritualistic Sacrifices of Human Beings

Ritualistic Torture, most notably the torture of a 15-year-old (Jace Donovan, Savvanah Hahn's stepbrother who went missing kidnapped by a "mysterious psycho" was actually held captive by the Mayor himself, and only died 6 days later to bloodloss + ritualistic stabbings, his body was never recovered)

Multiple accounts of kidnapping

Abuse of Power, Corruption

Fraud/Embezzlement

Sending his henchmen to vandalize and damage property belonging anyone who stands in his way

Racketeering

Insider Trading

Forgery

Environmental Vandalism

False Imprisonment

Harassment/Having his henchmen stalk his "rivals"

Blackmail and Threats

Brainwashing and Cult Activity

Using Dark Magic to maintain influence over an entire town, gain longevity and make people adore him through the power of his venomous words

Bribing and Lobbying

Assault & Battery

Stalking Minors

Mrs. Adelaide Draycott

Harassment of a Sexual Nature

Attempted Sexual Exploitation (At multiple points in the story Mrs Draycott tries to get Dylan, 23M, to sleep with her or "fall in love" with her by using blackmail and trying to corner him into situations where he wouldn't have a choice. Luckily he manages to avoid all her attempts.)

Persistent Stalking

Breaking and Entering

Defamation/Slander/Libel

Emotional Manipulation (Gaslighting/Blackmailing/Threatening)

Indecent Contact/Unwanted Touching

Damaging of Property

Intimidation of a Minor (Mrs Draycott often implies to Amy, Dylan's 16-year-old sister, that Dylan is gonna get hurt if he keeps being "stubborn" and that he is already an outcast to the town so no one would care if something happened to him or Amy herself)

False Accusations/False Complaints/Perjury

Sheriff Isaac Clarke

First Degree Murder, covered up

Abuse of Power (as a police officer)

Excessive Use of Force/Police Brutality

False Arrest

Intimidation/Blackmail

Criminal Conspiracy/Colluding with Criminals

Obstruction of Justice/Aiding and Abetting (covering up the literal serial killer crimes of the Mayor in exchange for a hefty paycheck)

Threats of Violence

Misuse of Surveillance

Wrongful Seizure of Property

Fabricating Evidence (against someone completely innocent)

False Search Warrants/Invasion of Property

Fraudulent Reports

Manslaughter/Second Degree Murder

Attempted Murder (of multiple people, including minors)

Extortion

Torture (disguised as interrogation)

Soliciting Bribes

Aiding in Racketeering

Branden Heddam

Extreme Child Abuse & Child Neglect

Child Endangerment

Abandonment of Parental Responsibilities

Threats of Extreme Violence/Threats of Death

Psychological/Emotional Abuse

Attempted Kidnapping of a Minor (While Zach, his stepson, is on-the-run from him and hiding at Amy & Dylan's place, Branden and his biker gang attempt to kidnap him)

Multiple Accounts of Assault & Battery

Attempt to Contribute to Minor Delinquency

Terrorizing

Aggravated Assault/Battery of a Man in front of his ward + Intentional Psychological Trauma

Theft/Burglary/Robbery/Mugging

Gang Activities + Gang Involved Violence

Drug Dealing

Bearing Illegal Weapons

Illegal Hunting/Poaching

Environmental Damage

Reckless/Drunk Driving

Cathleen "Cath" Edwards

Economic Duress

Blackmail/Emotional Manipulation

Attempted Title Deed Forgery

Rent Gouging/Unlawful Rent Increases

Loan Sharking

Illegal Fees and Charges

Stalking

Predatory Lending

Debt Bondage

Coercive Collection Practices

Conspiracy to Commit Murder/Conspiracy to Commit Kidnapping

Racketeering

Sabotage

Blackmail of a Minor

Disturbing the Peace

Tagging (gently): @sleepy-night-child, @kaylinalexanderbooks, @smol-feralgremlin, @wyked-ao3, @topazadine @littleladymab,

@winterandwords, @eccaiia, @sarahlizziewrites, @illarian-rambling

@agirlandherquill, @anoelleart, @ray-writes-n-shit

@writernopal, @anyablackwood, @unstablewifiaccess, @forthesanityofstorytellers

@the-golden-comet

@i-can-even-burn-salad, @cakeinthevoid @thecomfywriter

@thepeculiarbird, @clairelsonao3, @memento-morri-writes, @starlit-hopes-and-dreams @amaiguri

@cherrychiplip @thecomfywriter @thelovelymachinery @bookwormclover

@differentnighttale, @leahnardo-da-veggie

[boundlesspaths]

Kevin Modany’s Fraud Exposed (2024)

In recent court filings, it was shown that Kevin Modany is the person responsible for the crime. Deborah Caruso, an Indianapolis attorney and bankruptcy trustee, is representing ITT’s creditors, who include investors and students. These creditors include Kevin Modany, a former CEO of ITT, as well as eight former board members. The complaint, which is worth $250 million, was filed by Caruso. Those interested in learning more about this dishonest artist can read this article.

Who is Kevin Modany?

Kevin Modany, Managing Director of Indiana-based Bluerock Partners, has a questionable background. Although Modany has vast strategic consulting expertise, his money issues have damaged his career. The previous mistakes of Modany, a globally experienced strategy consultant, overshadow his Strategic Planning, Leadership, Due Diligence, Performance Management, and Executive Management skills.

Modany has provided senior management and strategy consultancy to business services companies since joining Bluerock Partners in 2016. Due to his time at ITT Educational Services Inc., his experience in due diligence, mergers & acquisitions, strategic planning, tech implementation, process development, performance management, and cash flow/financial performance optimization is sometimes questioned. After his service, the SEC accused him of fraud, which tarnished his career.

Kevin Modany is accused by the SEC, but why?

The SEC charged Kevin Modany and Fitzpatrick in 2015, claiming that they had fraudulently concealed the poor performance and potential financial ramifications of two student loan programs that ITT had provided financial guarantees.

The same alleged activity gave rise to previous fraud claims that ITT had settled. In response to the SEC’s accusations that they served as control persons for ITT’s fraud and other offenses, Kevin Modany and Fitzpatrick settled.

On May 12, 2015, the Securities and Exchange Commission filed fraud charges against ITT Educational Services Inc., its CEO Kevin Modany, and its CFO Daniel M. Fitzpatrick.

Charged by the SEC for defrauding ITT’s investors, the national for-profit college operator and its two directors concealed the disappointing outcomes and catastrophic financial ramifications of two student loan programs that ITT had financially supported.

To provide off-balance sheet loans for its students, ITT launched both of these student loan programs—known as the “PEAKS” and “CUSO” programs—after the collapse of the private student loan market. To get people to finance these riskier loans, ITT promised to lower the risk of bankruptcy from the educational financing pools.

The SEC claimed that by 2012, the underlying loan pools were operating in such a terrible way that ITT’s guarantee obligations surfaced and began to inflate. The complaint was brought in the Southern District of Indiana U.S. District Court.

Rather than informing its investors that it intended to spend hundreds of millions of dollars on its guarantee, ITT and its management took many actions to give the appearance that ITT’s exposure to these projects was far more restricted than it was. As ITT began to reveal the implications of its operations and the number of payments it needed to make to return the guarantees, its stock price fell precipitously, falling by about two-thirds in 2014.

To conceal the extent of ITT’s guarantee obligations for the PEAKS and CUSO projects, the SEC filed a lawsuit accusing Fitzpatrick, Kevin Modany, and ITT of participating in an unlawful conspiracy and making many false and misleading claims.

For example, to keep PEAKS loans from failing and from generating guarantee payments totaling tens of millions of dollars, ITT often paid past-due student borrower accounts without disclosing this activity.

ITT also tallied its expected guarantee payments against estimated profits for many years ahead of time, all without revealing this process or its immediate financial ramifications. Even though ITT was in charge of the program’s financial results, it nonetheless chose not to include the PEAKS initiative in its financial reports. Along with providing misleading information, ITT and management withheld crucial facts.

The SEC’s lawsuit claims that this conduct is illegal under federal securities laws, which prohibit fraud certification, internal monitoring, disclosure, recordkeeping, and documentation, as well as frauds.

Furthermore, Section 304 of the Sarbanes-Oxley Act of 2002 (often referred to as “Sarbanes-Oxley”) was broken by Kevin Modany and Fitzpatrick, according to the SEC’s complaint.

Apart from civil monetary penalties, the SEC is asking for further remedies such as permanent restraining orders and restitution with interest on prejudgment claims. The SEC also sought to award damages to Kevin Modany and Fitzpatrick and impose restrictions on officers and directors under Section 304 of Sarbanes-Oxley.

To conduct the SEC’s investigation, Judy Bizu, Anne Romero, Jason Casey, and Zachary Carlyle collaborated. Michael Osnato, Reid Muoio, and Laura Metcalfe of the Complex Financial Instruments Unit have been in charge of the inquiry. Mr. Carlyle, Polly Atkinson, and Nicholas Heinke will be leading this case.

Kevin Modany: The Impacts of the SEC Allegations

A prior settlement of fraud-related charges was reached by ITT itself, which was based on analogous allegations of improper activity. Kevin Modany and Fitzpatrick were sought by the Securities and Exchange Commission (SEC) because they were regarded as “control persons” overseeing the fraudulent conduct and other regulatory violations committed by ITT. This was because they significantly controlled and influenced the commercial operations of ITT.

Within their settlement deals with the SEC, Kevin Modany and Fitzpatrick did not accept or reject the allegations that were made against them in the SEC’s complaint. As part of the agreement, they did, however, give their approval to some initiatives, including the following:

Prohibited from Assuming Leadership Roles: Being Restricted from Leadership Jobs: Both Modany and Fitzpatrick were prohibited from holding jobs as executives and directors of public companies for five years. As a consequence of this, they are not allowed to hold positions of authority inside publicly listed companies, including those of chief executive officer, chief financial officer, or board of directors.

Financial Charges: Fitzpatrick had to pay a fine of $200,000, while Modany was ordered to pay a fine of $100,000. Both of these individuals were subject to financial penalties. These penalties are a representation of the financial ramifications that are said to have resulted from their potential involvement in fraudulent activities.

Future Guidelines for Behavior: They were also prohibited from behaving in a controlling way that might result in a violation of the antifraud and annual reporting sections of the federal securities laws. This restriction applies to their future conduct. This indicates that they are not permitted to take part in any action that might result in the publication of information that is either inaccurate or misleading to regulatory authorities or investors.

Releasing Auditing Practices: In addition, Modany and Fitzpatrick agreed to be suspended from their respective positions as SEC-registered public accountants. This was a part of their agreement to abandon their auditing practice. The implication of this is that they are unable to do audits, accounting services, or any other work for companies that are susceptible to SEC enforcement. After serving the suspension, which is for a certain time, precisely five years, they have the option of applying for reinstatement.

Conclusion

The SEC claims against Kevin Modany and Daniel Fitzpatrick highlights ITT Educational Services Inc.’s trust and transparency issues. The SEC accused Modany and Fitzpatrick of hiding ITT’s PEAKS and CUSO student loan programs’ declining performance and financial concerns, harming investors and students. These claims show how crucial correct disclosure and honest communication are to investor trust and regulatory compliance.

Both Modany and Fitzpatrick were fined heavily, barred from public company executive positions for five years, and prohibited from participating in securities law violations. In addition, they resigned as SEC-registered public accountants.

This case warns against business mismanagement and the need for ethical leadership. Corporate leaders must prioritize openness and honesty in financial reporting and operations. The SEC settlement and penalties seek to discourage future misbehavior, protecting investors and the financial industry.

The case is complicated and severe since numerous SEC investigators and lawyers were involved, demonstrating the enormous efforts needed to detect and handle such fraud. The SEC will continue to hold business executives responsible for acts that harm investors and violate federal securities laws, as this resolution states.

[griffinmcgahey-blog]

How Process Automation Benefits the Banking Sector?

Process automation in banking refers to the use of technology or software to execute repetitive, rule-based operations or tasks in the banking sector. Process automation often requires a wide range of technologies like machine learning and AI bots that have studied human actions and tried to replicate them by interfacing with digital systems in order to generate reports, copy and paste data, read out content from a screen, and click buttons. Because the banking sector is rife with these types of rule-based, repetitive tasks, the adoption of process automation is at the core of operational efficiency. Similarly, because most banks deal with a very large amount of data on a daily basis, there is a need to automate processes to ensure that repetitive and critical tasks are not susceptible to human errors.

Banks are increasingly adopting process automation because it reduces turnaround time when addressing customer needs. For instance, processes that used to take days can now be executed and finalized in a matter of hours or minutes. In addition to reducing turnaround time, process automation also helps banks cut down on processing costs in most of their operations. With process automation, banks get to streamline data and labor-intensive processes like customer acquisition, KYC verification, social security administration, and withdrawals. This means that banking officials can now dedicate their time to less repetitive tasks like growing the business and engaging customers to offer them a more personalized experience.

Customer service is the most impacted by process automation in the banking sector. This area usually involves answering questions and addressing complaints on issues bordering loan and account inquiry, and bank fraud. Without a process automation mechanism, addressing all of these issues can be overwhelming for customer service. Process automation can be deployed to handle repetitive and low-priority queries to achieve a low turnaround time and to attend to high-priority queries that require a substantial amount of brain work.

Process automation is also instrumental in credit card processing. In the past, banks used to take weeks to approve and validate customer credit card applications. Because of how time-consuming and tedious this process was, it led to significant customer dissatisfaction, with customers eventually canceling their requests. However, as banks began to adopt process automation, the process of credit card validation became significantly less tedious, and it happened faster. Banks now make use of software that gathers customer data, conducts both credit and background checks, and determines the eligibility of the customer based on already programmed yardstick or parameters.

The banking industry is heavily regulated. Keeping up with all these regulatory expectations could be daunting. So, banks now use process automation to keep track of these regulatory expectations and work on complying with them. In 2016, Accenture conducted a survey that found that 73 percent of compliance officers thought process automation increased their productivity and enhanced the quality of their compliance process. The survey also noted that compliance officers believe that process automation reduces the occurrence of monotonous tasks and helps out with duties that involve human intelligence.

Finally, process automation has been helpful in reducing human errors while facilitating risk reduction in operations. For instance, there is now little or no need for paper documentation as process automation only requires e-documents, which are largely safe. Also, data processing with process automation is mostly error-free compared to the ones humans compile.

[infignito]

Finding the Best Lawyer in Mumbai for Your Legal Needs

Navigating the legal system in Mumbai can be a challenging experience, whether you’re dealing with a domestic violence case, seeking bail, or handling complex civil, banking, or criminal matters. Mumbai, a city known for its bustling legal scene and diverse legal challenges, requires individuals to find the best lawyer suited to their specific needs. Here’s a comprehensive guide to help you identify the best lawyer in Mumbai for various legal issues.

 best lawyer in Mumbai for domestic violence

Domestic violence cases are highly sensitive and demand a lawyer with both expertise and empathy. The best lawyer in Mumbai for domestic violence will be adept at handling cases involving physical abuse, emotional trauma, and legal protection under the Protection of Women from Domestic Violence Act.

A top domestic violence lawyer should provide a safe and supportive environment, helping victims understand their rights and navigate the legal system. They will assist in filing complaints, obtaining protection orders, and representing clients in court to ensure their safety and seek justice. They should also be prepared to deal with ancillary issues such as child custody and financial support, which are often intertwined with domestic violence cases.

Best lawyer in Mumbai for bail matters

Securing bail is a critical aspect of the legal process for anyone facing criminal charges. The best lawyer in Mumbai for bail matters will have a deep understanding of the legal requirements and procedures related to bail applications. They must be skilled in presenting compelling arguments to convince the court to grant bail and ensure their client’s release.

A proficient bail lawyer will also be familiar with the nuances of the Indian Penal Code and the Criminal Procedure Code. They should be able to address any concerns the court may have and negotiate effectively to achieve the best possible outcome for their client.

best lawyer in Mumbai for civil matters

Civil matters can range from property disputes and contract issues to family law cases and more. The best lawyer in Mumbai for civil matters will be well-versed in the various aspects of civil law and have a proven track record in handling similar cases.

A top civil lawyer should excel in both litigation and alternative dispute resolution methods such as mediation and arbitration. They will work to resolve disputes efficiently, ensuring that clients’ rights and interests are protected. Whether you’re dealing with a breach of contract, property disagreements, or family-related issues, a skilled civil lawyer will provide the guidance and representation needed to navigate the complexities of civil law.

best lawyer for banking matters

Banking matters often involve intricate financial regulations and legal principles. The best lawyer for banking matters will be experienced in handling cases related to loans, mortgages, financial fraud, and regulatory compliance.

A top banking lawyer should have a thorough understanding of banking laws and financial regulations, enabling them to address disputes with financial institutions effectively. They will be skilled in negotiating settlements, managing regulatory investigations, and providing strategic legal advice to safeguard your financial interests. Whether you're facing issues with a bank or seeking advice on complex financial transactions, a knowledgeable banking lawyer is essential.

 best lawyer in Mumbai for criminal matters

Criminal cases carry serious implications and require a lawyer with a strong grasp of criminal law and defense strategies. The best lawyer in Mumbai for criminal matters will have extensive experience in handling a wide range of criminal charges, from minor offenses to major felonies.

A leading criminal defense lawyer should be proficient in building a robust defense, challenging the prosecution's evidence, and ensuring that the client's rights are upheld throughout the legal process. They should also be skilled in negotiating plea deals and exploring alternative sentencing options when appropriate. Whether you’re dealing with charges of theft, assault, or any other criminal offense, a top criminal lawyer will be crucial in navigating your case and achieving the best possible outcome.

Finding the best lawyer in Mumbai for your specific legal needs is essential for ensuring that you receive the highest quality of legal representation. Whether you’re dealing with domestic violence, seeking bail, handling civil disputes, addressing banking issues, or facing criminal charges, the right lawyer can make a significant difference in the outcome of your case.

Take the time to research and consult with potential lawyers to find one who possesses the necessary expertise, experience, and understanding of your unique situation. A well-chosen lawyer will not only advocate for your rights but also provide the support and guidance needed to navigate the complexities of the legal system in Mumbai.

[dankusner]

Attorney gets 25 years in Bridgeport bank embezzlement

A federal judge on Tuesday sentenced a Chicago attorney to 25 years in prison for helping embezzle more than $8 million from a small Bridgeport neighborhood bank that later collapsed, calling him a “delusional” and unrepentant criminal who abused the trust placed in him as a lawyer.

Robert Kowalski, 62, was convicted by a jury last year on all counts of embezzlement, bankruptcy fraud and income tax fraud after a 3 ½-week trial before U.S. District Chief Judge Virginia Kendall, where Kowalski took the unusual and typically ill-advised step of representing himself.

The long-running case featured years of bizarre pretrial hearings that saw Kowalski locked up for violating his bond and filing dozens of motions alleging investigators were hiding evidence and colluding with the judge to railroad him.

It was more of the same during Tuesday’s five-hour sentencing hearing, where Kowalski repeatedly interrupted the judge and prosecutors with complaints of unfair treatment.

For the most part, Kendall listened patiently to Kowalski’s rants.

But when he repeatedly interrupted her as she issued the sentence, the judge cut him off with a sharp “Enough.”

“You are absolutely incapable of looking at the reality of this situation and your role in it,” Kendall said to Kowalski, who stood at the lectern in an orange jail outfit with deputy U.S. marshals flanking him.

“You fabricated records to the IRS, you fabricated records to the bankruptcy court … You are absolutely delusional that you are a victim of this case. You’re not.”

Kendall said Kowalski’s criminal culpability was further exacerbated by his status as an attorney and that he helped steal from a community bank where “people felt that they could trust that bank to hold their money.”

“You do not have any respect for the rule of law,” she said.

After the judge imposed the 25-year prison term and $7.2 million forfeiture, Kowalski shouted, “This is not right! For all my hard work I get a life sentence? … This is very unfair. This is a day of evil.”

Kowalski was among 14 defendants charged in an alleged multiyear embezzlement scheme that preceded the failure of Washington Federal Bank for Savings, a family-run institution that had been a mainstay in the city’s Bridgeport neighborhood for more than a century.

Kowalski, who was a large debtor of the bank when it was closed by regulators in December 2017, was accused of conspiring with the bank’s president, John Gembara, to rack up millions in collateral-free loans, then lying about and concealing assets and income in bankruptcy proceedings and on his tax returns.

Police records show Gembara, 56, was found dead on Dec. 3, 2017, in the Park Ridge home of a bank customer where he had been staying.

An autopsy report showed Gembara was found seated in a chair in his bedroom with a rope tied to the banister and around his neck.

His death was ruled a suicide by the Cook County medical examiner’s office.

The sprawling investigation also led to one other high-profile trial.

Patrick Daley Thompson, the then-11th Ward alderman and scion of the Daley political dynasty, was convicted in 2021 of two counts of lying to federal regulators about loans he had with Washington Federal and falsely claiming mortgage interest deductions on his tax returns.

Thompson, who by law was forced to step down immediately after his conviction, was sentenced to four months in prison.

Prosecutors said in their opening statement last month that Kowalski used his friendship with Gembara to turn Washington Federal into his own piggy bank, getting collateral-free loans to bankroll his real estate developments and using letters of credit from the bank to fool other creditors.

Kowalski, meanwhile, tried to pin the blame on Gembara, saying his friend ran a scheme that allegedly involved years of bad loans, shifting collateral, forged signatures and even cash buried by one of his customers somewhere in the Cayman Islands.

“He didn’t start out to be a bad man, but his plan was terrible,”

Kowalski said in his opening statement to the jury. “It wasn’t George Bailey in ‘It’s a Wonderful Life.’ ”

The jury deliberated only about an hour before convicting him on all counts.

[princessjoyvibora]

Article 1344. In order that fraud may make a contract voidable, it should be serious and should not have been employed by both contracting parties.

Incidental fraud only obliges the person employing it to pay damages. (1270)

Tankeh vs. Development Bank of the Philippines

(G.R. 171428 November 11, 2013)

Facts:

Ruperto V. Tankeh is the president of Sterling Shipping Lines, Inc. Ruperto V. Tankeh applied for a loan from public, respondent Development Bank of the Philippines for the partial financing of an ocean-going vessel named the M/V Golden Lilac. To authorize the loan, Development Bank of the Philippines required that the following conditions be met:

A first mortgage must be obtained over the vessel, which by then had been renamed the M/V Sterling Ace;

Ruperto V. Tankeh, petitioner Dr. Alejandro V. Tankeh, Jose Marie Vargas, as well as respondents Sterling Shipping Lines, Inc. and Vicente Arenas should become liable jointly and severally for the amount of the loan.

The future earnings of the mortgaged vessel, including proceeds of Charter and Shipping Contracts, should be assigned to Development Bank of the Philippines.

Development Bank of the Philippines should be assigned no less than 67% of the total subscribed and outstanding voting shares of the company. The percentage of shares assigned should be maintained at all times, and the assignment was to subsist as long as the assignee, Development Bank of the Philippines, deemed it necessary during the existence of the loan.Petitioner wrote a letter to respondent Ruperto V. Tankeh saying that he was severing all ties and terminating his involvement with Sterling Shipping Lines, Inc.

Petitioner filed several Complaints against respondents, praying that the promissory note be declared null and void and that he be absolved from any liability from the mortgage of the vessel and the note in question.

Issues:

Whether the Court of Appeals erred in finding that respondent Rupert V. Tankeh did not commit fraud against the petitioner.

Ruling:

Petition is actually one of certiorari under Rule 65 of the Rules of Court. Petition for Review on Certiorari under Rule 45.Thus, petitioner's failure to show that there was neither appeal nor any other plain, speedy or adequate remedy merited the dismissal of the Complaint.

Types of Fraud in Contracts

Fraud is defined in Article 1338 of the Civil Code as fraud when, through insidious words or machinations of one of the contracting parties, the other is induced to enter into a contract which, without them, he would not have agreed to.

Art. 1339. Failure to disclose facts, when there is a duty to reveal them, as when the parties are bound by confidential relations, constitutes fraud.

Art. 1340. The usual exaggerations in trade, when the other party had an opportunity to know the facts, are not in themselves fraudulent.

Art. 1341. A mere expression of an opinion does not signify fraud, unless made by an expert and the other party has relied on the former's special knowledge.

Art. 1342. Misrepresentation by a third person does not vitiate consent, unless such misrepresentation has created substantial mistake and the same is mutual.

Art. 1343. Misrepresentation made in good faith is not fraudulent but may constitute error.

The distinction between fraud as a ground for rendering a contract voidable or as basis for an award of damages is provided in Article 1344:

In order that fraud may make a contract voidable, it should be serious and should not have been employed by both contracting parties.

Incidental fraud only obliges the person employing it to pay damages. (1270)

There are two types of fraud contemplated in the performance of contracts: dolo incidente or incidental fraud and dolo causante or fraud serious enough to render a contract voidable.

[supremojohndee]

Article 1299 - ObliCon

Art. 1299. If the original obligation was subject to a suspensive or resolutory condition, the new obligation shall be under the same condition, unless it is otherwise stipulated. 

Ledonio

v.

Capitol Development

Facts:

respondent alleged that petitioner obtained from a Ms. Patrocinio S. Picache two loans, with the aggregate principal amount of P60,000.00, and covered by promissory notes duly signed by petitioner. In the first promissory note,[5] dated 9

November 1988, petitioner promised to pay to the order of Ms. Picache the principal amount of P30,000.00, in monthly installments of P3,000.00, with the first monthly installment due on 9 January 1989. In the second promissory note,[6] dated 10 November

1988, petitioner again promised to pay to the order of Ms. Picache the principal amount of P30,000.00, with 36% interest per annum, on 1 December 1988. In case of default in payment, both promissory notes provide that (a) petitioner shall be liable for a penalty equivalent to

20% of the total outstanding balance; (b) unpaid interest shall be compounded or added to the balance of the principal amount and shall bear the same rate of interest as the latter; and (c) in case the creditor, Ms. Picache, shall engage the services of counsel to enforce her... rights and powers under the promissory notes, petitioner shall pay as attorney's fees and liquidated damages the sum equivalent to 20% of the total amount sought to be recovered, but in no case shall the said sum be less that P10,000.00, exclusive of costs of suit.

Ms. Picache executed an Assignment of Credit[7] in favor of respondent

Since petitioner did not pay any of the loans covered by the promissory notes when they became due, respondent -- through its Vice President Nina P. King and its counsel King, Capuchino, Banico & Associates -- sent petitioner several demand letters.[8]

Despite receiving the said demand letters, petitioner still failed and refused to settle his indebtedness, thus, prompting respondent to file the Complaint with the RTC... petitioner sought the dismissal of the Complaint averring that respondent had no cause of action against him. He denied obtaining any loan from Ms. Picache and questioned the genuineness and due execution of the promissory notes, for they were... the result of intimidation and fraud; hence, void. He asserted that there had been no transaction or privity of contract between him, on one hand, and Ms. Picache and respondent, on the other. The assignment by Ms. Picache of the promissory notes to respondent was a mere ploy... and simulation to effect the unjust enforcement of the invalid promissory notes and to insulate Ms. Picache from any direct counterclaims, and he never consented or agreed to the said assignment.

the RTC rendered a Decision[12] on 6 August 1993, ruling in favor of respondent.

The RTC also sustained the validity and enforceability of the Assignment of Credit executed by Ms. Picache in favor of respondent, even in the absence of petitioner's consent to the said assignment,... petitioner filed an appeal with the Court of Appeals

The appellate court, in a Decision,[14] dated 20 March 2001, found no cogent reason to depart from the... conclusions arrived at by the RTC in its appealed Decision, dated 6 August 1993, and affirmed the latter Decision in toto.

Issues:

whether or not the Court of Appeals committed grave abuse of discretion in affirming in... toto the RTC Decision

Petitioner's main argument is that the Court of Appeals erred when it ruled that there was an assignment of credit and that there was no novation/subrogation in the case at bar.

Ruling:

This Court cannot sustain petitioner's contention and hereby declares that the transaction between Ms. Picache and respondent was an assignment of credit, not conventional subrogation, and does not require petitioner's consent as debtor for its validity and enforceability.

An assignment of credit has been defined as an agreement by virtue of which the owner of a credit (known as the assignor), by a legal cause - such as sale, dation in payment or exchange or donation -and without need of the debtor's consent, transfers that credit and its... accessory rights to another (known as the assignee), who acquires the power to enforce it, to the same extent as the assignor could have enforced it against the debtor.

On the other hand, subrogation, by definition, is the transfer of all the rights of the creditor to a third person, who substitutes him in all his rights. It may either be legal or conventional. Legal subrogation is that which takes place without agreement but by operation of... law because of certain acts. Conventional subrogation is that which takes place by agreement of parties.

Although it may be said that the effect of the assignment of credit is to subrogate the assignee in the rights of the original creditor, this Court still cannot definitively rule that assignment of credit and conventional subrogation are one and the same.

Since his consent is immaterial, the only other matter which this Court must determine is whether petitioner had knowledge of the Assignment of Credit, dated 1 April 1989, between Ms. Picache and respondent. Both the Court of Appeals and the RTC ruled in the affirmative, and so... must this Court. Petitioner does not deny having knowledge of the assignment of credit by Ms. Picache to the respondent. In 1989, when petitioner's loans became overdue, it was respondent and its counsel who sent several demand letters to him. It can be reasonably presumed that... petitioner received said letters for they were sent by registered mail, and the return cards were signed by petitioner's agent. Petitioner expressly acknowledged receipt of respondent's demand letter, dated 13 June 1989, to which he replied with another letter, dated 21 June

1989, stating that he would settle his account with respondent but also requesting consideration of the losses he suffered from the electric power disconnection at the property he leased from MRMC. It further appears that petitioner had never questioned why it was respondent... seeking payment of the loans and not the original creditor, Ms. Picache. All these circumstances tend to establish that respondent already knew of the assignment of credit made by Ms. Picache in favor of respondent and explains his acceptance of all the demands for payment of... the loans made upon him by the respondent.

Finally, assuming arguendo that this Court considers petitioner a third person to the Assignment of Credit, dated 1 April 1989, the fact that the said document was duly notarized makes it legally enforceable even as to him.

Notarization converted the Assignment of Credit, dated 1 April 1989, a private document, into a public document,[33] thus, complying with the mandate of the afore-quoted provision and making it enforceable even as against third persons.

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It Pays To Be Careful So As Not To Fall For Home Loan Frauds

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It Pays To Be Careful So As Not To Fall For Home Loan Frauds

Home Loan, Fraud, Home Loan Frauds  A recent complaint by a man in Gurgaon revealed home loan frauds amounting to Rs 4.79 crore involving forged property documents, according to a media report.  Bank frauds for home loans are not new within the real estate market. They keep happening now and then. “Fraudsters have been in […]

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Kennedy Funding Complaints: Common Issues and Customer Reviews

The Kennedy Funding lawsuit has become a prominent case in the realm of commercial real estate lending, involving Kennedy Funding, a commercial bridge loan lender, and Virgil Shelton, a seller of cemeteries. This legal battle centers around accusations of breach of contract and fraud, including Kennedy Funding Complaints, resulting in significant implications for finance, law, and business ethics.

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The Pew Charitable Trusts today released a report detailing fraudulent and abusive practices associated with payday loans offered online. The study found that Internet loans are more expensive than those offered through storefronts; that they are designed to promote renewals and long-term indebtedness; that many online borrowers report being threatened by lenders or debt collectors; and that the vast majority of payday borrower complaints are about online loans. Pew calls on federal regulators to address these problems by establishing strong, clear, and consistent consumer protections for the small-dollar lending market as a whole.

The report, Fraud and Abuse Online: Harmful Practices in Internet Payday Lending, is the fourth in the “Payday Lending in America” series produced by Pew’s small-dollar loans project. Problems in the online payday loan market have been chronicled anecdotally, but Pew’s report is the first formal analysis to use surveys and focus groups, consumer complaints, company filings, and lenders’ spending on advertising and prospective-borrower leads.

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The Pew Charitable Trusts today released a report detailing fraudulent and abusive practices associated with payday loans offered online. The study found that Internet loans are more expensive than those offered through storefronts; that they are designed to promote renewals and long-term indebtedness; that many online borrowers report being threatened by lenders or debt collectors; and that the vast majority of payday borrower complaints are about online loans. Pew calls on federal regulators to address these problems by establishing strong, clear, and consistent consumer protections for the small-dollar lending market as a whole.

The report, Fraud and Abuse Online: Harmful Practices in Internet Payday Lending, is the fourth in the “Payday Lending in America” series produced by Pew’s small-dollar loans project. Problems in the online payday loan market have been chronicled anecdotally, but Pew’s report is the first formal analysis to use surveys and focus groups, consumer complaints, company filings, and lenders’ spending on advertising and prospective-borrower leads.

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Case: MULTI-VENTURES CAPITAL and MANAGEMENT CORP. vs. STALWART MANAGEMENT SERVICES CORP. (1359)

GR No. 157439, July 4, 2007

FACTS:

Multi-Ventures Capital and Management Corporation (petitioner) and Stalwart Management Services Corporation (respondent) are involved in a dispute over the nature of their contract.

On January 11, 1991, respondent obtained a loan from petitioner in the amount of P9,000,000.00, with interest.

The transaction was denominated as a sale, where petitioner bought Land Bank bonds from respondent at a discounted price, with the bonds serving as collateral for the loan.

Petitioner filed a complaint for reformation of the instrument, seeking to express the true intent of the parties, which is that the ostensible sale of the bonds is actually a loan agreement.

Respondent and its co-defendants denied petitioner's allegations and claimed that the transaction was a purchase of Land Bank bonds, not a loan.

The Regional Trial Court (RTC) ruled in favor of petitioner, ordering the instruments to be reformed as a contract of loan and not a contract of sale. The defendants were also ordered to pay the petitioner the sum of P11,557,972.60, plus interest and attorney's fees.

ISSUES:

Whether the contract between the parties is one of loan or sale.

HELD:

The Supreme Court denied the petition for lack of merit and upheld the Court of Appeals' (CA) decision that the transaction was a sale and not a loan.

Costs were imposed on the petitioner.

RATIO:

For an action for reformation of an instrument to prosper, there must be a meeting of the minds of the parties, the instrument must not express the true intention of the parties, and the failure to express the true intention must be due to mistake, fraud, inequitable conduct, or accident.