Antonio Flores’ Blog

The Council Act of 29 May 2000 establishing the Convention on Mutual Assistance in Criminal Matters between the Member States of the European Union enables prosecutors and courts of EU countries to receive assistance from one another when investigating crimes. This Act supplements the European Convention on Mutual Assistance in Criminal Matters of 20 April 1959.

The Act does not cover International police, extradition and customs collaboration, all of which are regulated by other laws, but measures required by courts and prosecutors in preliminary investigation and in court proceedings.

Denia (Alicante) Court number 1, currently investigating alleged fraud in the marketing and sale of Rothschild mortgages in Spain, has ordered one of such measures: the interrogation of the de facto owner of The Rothschild Group, Mr. Baron David de Rothschild. To achieve this, lawyers acting for victims of the “Credit Select Series 4” mortgage loan have recently submitted to the Spanish Court a list of questions that Mr. Rothschild should respond to, when summoned by the appropriate French Court.

The deposition questions relate mostly to the extensive advertising employed by Guernsey-based Rothschild Bank International, owned by The Rothschild Group, to market and sell Spanish mortgages as scheme to reduce potential inheritance taxes.

Rothschild lawyers have cynically denied any knowledge of the proceedings and refused to collaborate, in spite of a meeting held with a journalist from El País to discuss their version prior to running the story, or the visit paid by police officers to their Madrid offices to deliver the summons. On this occasion, the officers were fobbed off by dismissive staff with a lame excuse: “he does not work here”.

Mr. Rothschild’s attitude is in contrast with his group’s advertised motto, “Harmony, Integrity, Industry, qualities that are best underpinned by the Denia judge who, so far, seems unperturbed by the stature of the individual.

With Courts resuming their activity this week, there will be a mixture of expectation and hope among the victims of a fraudulently-sold mortgage loan who now need to know, sooner rather than later, what Rothschild’s top man has to say.

Antonio Flores Equity Release Baron David Rothschild, Credit Select Series 4 loan, Mark Coutanche, Rothschild Equity Release, Stephen Dewsnip

A recent ruling by the European Court of Justice (ECJ) has given Spanish Courts dealing with loan foreclosures the right to interpret contracts and their clauses, but has not declare eviction laws completely illegal, as has been widely publicized. The Q & A below summarize the ruling and its effects on borrowers:

Why did the ECJ get involved in this matter? Spanish foreclosure procedural laws are deemed, among legal professionals, as a one-way street. This means that if your bank forecloses you either pay up the whole sum owed or you instigate criminal proceedings to prove that the loan was fraudulent. There are no other possible defenses to stop ultimate eviction under these declaratory proceedings

Is my mortgage loan illegal by virtue of this ruling? No but now Spanish Court have the powers to delay or freeze the eviction of home buyers, who have fallen behind on their mortgage payments, whilst they assess the fairness of certain terms and conditions within the loan contract that, according to the ruling, create “significant imbalance” to the detriment of the consumer.

Which terms were referred to in the ruling? The ECJ criticized the contract submitted to them on 2 grounds: it allowed the bank to take away a home after just one failure to pay an instalment, and provided for a default interest rate of 18.75 per cent. According to the ECJ, Spanish Courts dealing with foreclosures are now able to determine the validity of these clauses.

So how does this affect my existing mortgage loan? The ECJ has opened the door for Spanish Courts to annul mortgage loan clauses that are objectively unfair, such as those quoted above. However, it does not give the borrower the right to stop paying the loan, avoid the debt altogether or stay in the property for good without keeping up the repayments. As journalist Mike Shedlock wrote in respect to Mr. Aziz, the claimant whose loan was scrutinized by the ECJ, “I suspect he can afford to pay 0% and nothing on principal”…which gives us an idea of the where the real problem lies!

Antonio Flores Equity Release, Mortgages, Property loan foreclosures Spain, Mortgage loan in Spain, Spanish eviction, Spanish loan foreclosure laws

68 year-old Anne may have been “saved by the bell”, as she fully qualifies for Court protection under new anti-eviction legislation just passed by the Spanish Government, at least during 2 years.

Her story probably epitomizes the greed of most banks, and their bankers, in pursuit of sky-high profits, commissions and promotions. Predatory, crazy, irresponsible, avaricious are some words that can be applied to what happened to Anne, a story where a bank actually forced a loan on someone who was, at the time, convalescing of a cancer operation.

Anne owned a small apartment outright in Marbella, had some savings inherited from her late mother and after having beaten a life threatening cancer stumbled across a lender, Jyske Bank Gibraltar, who convinced her that she should take up the opportunity to access cheap money and upgrade her living conditions by taking out 2 loans, using the spare cash savings to top up the bank’s money and then, hopefully, get some fresh new income by renting one of the two and…bla bla, as we all now know.

The odds were clearly against her: she could not prove she had an official income in Spain after 20 years living here (had never been registered with the Spanish Social Security system), was not able to work and relied on a €600 pension from the Belgian Government. No worries, Jyske Bank Gibraltar, after “carefully studying the case”, concluded she was a suitable borrower and eligible to take out 2 loans worth €550,000, repayable during then next 35 years. But quite how she intended to repay them remains a mystery even today, presumably even to Jyske’s Christian Bjørløw. What were they both thinking…? Was Jyske also convalescing…?

The law passed yesterday stipulates that even if her home has been repossessed, she qualifies for a 2-year moratorium as she has not yet been evicted. Time to type up a writ to the Courts!

Antonio Flores Equity Release, Litigation equity release, Eviction, foreclosure in spain, Gibraltar Private Banking, Jyske Bank, Jyske Bank Gibraltar, Jyske Bank Spain, Spanish Mortgage Loans