Digitally signed

by Joseph
Zernik
DN: cn=Joseph
Zernik,
email=jz12345
@earthlink.net,
Joseph Zernik DMD PhD c=US
Date:
Fax: (801) 998-0917 Email: jz12345@earthlink.net 2009.03.26
21:59:49 -07'00'

048.1

07-03-16. Meet & Confer Letter to CFC Legal Department

The letter provides full description of the missing records, and also of the inherently contradictory nature of the
existing records.

Att Todd Boock denied that any reports existed regarding Samaan’s loan applications.
 March 16, 2007
Via First Class Mail and Facsimile
Todd A. Boock
Countrywide Home Loans, Inc.
5220 Las Virgenes Road, MS: AC-11

Re: Samaan v. Zernik

Los Angeles County Superior Court No. SC087400

Dear Mr. Boock:

We have been retained by Joseph Zernik (“Dr. Zernik”) to represent him in

connection with the above referenced matter. As you know, on January 9, 2007,
Dr. Zernik’s prior attorney issued three individual subpoenas to Countrywide
Bank, American’s Lender and Countrywide Home Loans (collectively,
“Countrywide”). I would like to thank you for your cooperation in handling these
subpoenas, and their timely production. The scope of documents produced by
Countrywide in response to the subpoenas was far more responsive than the
document production Countrywide provided in response to the original subpoena
in August 2006.

As you probably know, in a case of this nature Dr. Zernik is held responsible for
the actions of others, most of which he was not aware of, were not under his
control, or at times were even in violation of his explicit instructions to his
purported agents. Countrywide’s response to the January 9, 2007 subpoenas
allowed us, for the first time, to gain a greater understanding of the general facts
and circumstances behind the events in this case, and has already made a
critical contribution for the defense.

We also understand that any attorney in your position may face substantial
dilemmas regarding producing documents responsive to the subpoenas. On the
one hand, you have duties of confidentiality and representation of client’s best
interests to Countrywide, while on the other hand, you are faced with new
obligations in the Sarbanes-Oxley Act of 2002. These new obligations arising out
of the Enron debacle have transformed the range of obligations of attorneys in
pubic corporations who are made aware of illegal acts by management. Finally,
there is the fast developing reality of what the New York Times called “implosion”
in the mortgage industry, and with it – an almost certainty of procedures ranging

12100 Wilshire Boulevard, Suite 800 T.323.658.8196

Los Angeles, California 90025 F.323.908.0204
www.schorr-law.com zschorr@schorr-law.com
March 19, 2007
Todd A. Boock
Countrywide Home Loans, Inc.
Page 2
from Congressional hearings to investigations by law enforcement agencies into
various aspects of underwriting, management, regulatory and legal oversight of
various lenders, including Countrywide.
Based on documents produced in response to Dr. Zenik’s January subpoenas,
we are beginning to have a clearer picture of these aspects of Countrywide’s
operations in late 2004 and early 2005.
We strongly believe that the documents already produced reflect two categories
of fraud and conspiracy by Maria McLaurin, Manager, San Rafael Wholesale
Branch, who we assume was and is an Officer of at least one of your corporate
entities:
a) Conspiracy in Fraud with Samaan and others against Zernik.
b) Fraud and Conspiracy with Samaan and others against Countrywide and
others.
While the former category may have smaller significance relative to the integrity
of governance at Countrywide, the latter must surely be a major cause of
concern - presenting a material deficiency. We may not have any standing in the
latter category, except as members of the public at large.
We have previously requested (our letter of xx/xx/xx, enclosed) that Countrywide
take the necessary steps to investigate our concerns. We have never received
any response to that letter. We are calling your attention to this matter again. We
would cooperate with any valid and efficient internal procedures undertaken by
Countrywide in this regard.
We realize that your dillema may be further complicated. Your reporting of fraud
by a corporate officer based on Sarbane-Oxley Act of 2002, presenting material
deficiency, would also put the burden of reporting on those signing your next
scheduled quarterly SEC reporting – both on the corporate and the accounting
firm sides. And Countrywide Financial Corporation may have already been
reported to the Department of Justice.
Incomplete Production

As you know, Dr. Zernik first issued a subpoena to Countrywide in August 2006,
prior to his representation by our office. Following Countrywide’s production, Dr.
Zernik called Maria McLaurin, a Branch Manager in San Rafael, to inquire
regarding documents Countrywide had failed to produce in response to his
subpoena. Those missing documents included, among other documents,
document/conversation/comment logs. In addition, Dr. Zernik inquired about the
inclusion of a deliberately misleading blank document with the title “Conversation
Log, San Rafael.” According to my client, Ms. McLaurin explained to Dr. Zernik
that she had decided that the printouts of document/convesation/comment logs
from Countrywide’s computer systems were not required as part of the response
to the subpoena, even though those documents are vital to Dr. Zernik’s defense
of his case.
March 19, 2007
Todd A. Boock
Countrywide Home Loans, Inc.
Page 3
My client then followed up with several phone calls to the Custodian of Records
in your department, Mariela Garcia, regarding these missing documents. In
these phone calls my client raised concerns that Ms. McLaurin was possibly an
accomplice to fraud, and that she apparently had undermined the subpoena
production of August 2006 by failing to produce several responsive documents
(the document/conversation/comment logs) and had instead inserted a
misleading document. According to my client, Ms Garcia repeatedly warned Dr.
Zernik that she was taking notes of that discussion. Ms Garcia also challenged
his claims that Countrywide had been using digital or computer logs for many
years, rather than the outdated paper forms for documents and conversation
logs. Ms. Garcia also claimed that she was not at liberty to discuss the details of
Countrywide’s operations. My client informed me that he then explained to Ms
Garcia, and apparently also to you at one point, that the main goal of the second
round of subpoenas was to obtain these logs. Therefore, he requested that your
department pay particular attention to documents originating from San Rafael.

In addition, my client added an unusual introductory paragraph to his repeat

subpoena in January 2007:

This repeat subpoena is served in conjunction with

complaints filed with the FBI, California Department of
Real Estate, and California Department of Justice, fo
fraud and conspiracy….A previous subpoena was
issued to Countrywide’s Custodian of Records on
August 8, 2006. …. That subpoena was evidently
handled by senior staff at the San Rafael Wholesale
Branch, in a grossly incomplete manner, and out of
compliance with the law.

At this point, the facts and circumstances surrounding Nivie Samaan’s

application(s) for a loan from Countrywide are still incomplete. In other words,
we are still missing several key documents that are critical for my client’s defense
of the lawsuit filed by Ms. Samaan. Therefore, we write to meet and confer
regarding Countrywide’s deficient document production.

Docuement/Conversation/Comment Logs

The Deposition Subpoenas for Production of Business Records issued to

Countrywide (collectively, the “Subpoenas”) sought, among other things, all
documents/Conversations/Comments logs and conversation logs in connection
with Nivie Samaan’s application for a loan from Countrywide for the purchase of
the real property commonly known as 320 South Peck Drive, Beverly Hills,
California 90012 (the “Property”). However, in response to Dr. Zernik’s
Subpoenas, Countrywide failed to produce their digital conversation logs. These
March 19, 2007
Todd A. Boock
Countrywide Home Loans, Inc.
Page 4
logs are known to exist. In fact, Countrywide produced one page of a
conversation log, a copy of which is attached as exhibit 1. This page, dated
January 27, 2005, provides evidence that additional logs and/or pages must
exist. Indeed, it is inconceivable that Countrywide does not have similar
computerized document/conversation/comment logs for the months of
September 2004 through January 2005 related to Nivie Samaan’s loan
application and the Property. We are seeking in particular the logs from the San
Rafael Wholesale Branch. Ms. McLaurin has even acknowledged that such
documents exists, but somehow claimed that she was not required to produce
those logs in response to the subpoena of August 2006.

Countrywide has not only failed to produce the relevant conversation logs, but it
has also deliberately misled Dr. Zernik through the production of an outdated and
unused conversation log. Indeed, we have enclosed a courtesy copy of that
unused log as exhibit 2. Clearly, had Countrywide chosen to comply with their
obligations under the law, they would have not have produced such a false,
misleading and irrelevant document. This deliberately misleading production will
independently expose Countrywide to civil liability should Countrywide fail to
supplement its document production. Please explain Countrywide’s basis for
providing this misleading document.

Underwriting Decision/Condition Letters

Dr. Zernik’s Subpoena also sought all writings, including underwriters’

decision/condition letters (See, Subpoena Categories (a) and (e)). Countrywide,
did produce the following Underwritering Decision/Condition Letters:

1) p145 1st Lien, Oct 14, 04 Letter by Frazier.

2) p202 1st Lien, Oct 14, 04 Letter by Frazier. *
3) p143-4 1st Lien, Oct 29, 04 Letter by McLaurin
4) p135(p1) p142 (p2) 1st Lien, Nov 3, 04 Letter by McLaurin
5) p 221 2nd Lien, Oct 14, 04 Letter by Frazier
6) p 214 2nd Lien, Oct 14, 04 Letter by Frazier*

* We believe these are copies of Frazier's letters mailed back by Samaan, received on 10/25/04 as part of
Samaan’s revised Loan Application

Please confirm that these three letters are a complete production of all
underwriting decision and/or condition letters issued regarding any and all loans
Nive Samaan applied for in connection with her potential purchase of the
Property. In other words, please confirm that you have produced all underwriter
decision and condition letters related to Nivie Samaan. If you have not produced
March 19, 2007
Todd A. Boock
Countrywide Home Loans, Inc.
Page 5
all underwriting or condition letters, please do so by no later than March 21,
2007.
The documents you have so far produced provide ample evidence for attempt at
fraud in the processing of these loans. Therefore, we must also require that you
produce by March 21, 2007 the following:
a) The full and complete Data Security Exceptions Report of the 1st and 2nd
lien loans, in particular, any exceptions where Maria McLaurin, Branch
Manager, or Kristin Orton on her behalf, logged into the system using
McLaurin’s supervising capacity to overrule Underwriting
Decisions/Conditions introduced by Diane Frazier, while the 1st and 2nd
lien loans were still assigned to Diane Frazier as Underwriter of Record,
b) The exact notation, with author’s identity, authority, and justification for the
transfer of the 1st and 2nd lien loans Underwriter’s authority from Diane
Frazier to Maria McLaurin and/or Kirstin Orton on McLaurin’s behalf,
c) Any document, such as loan application completed and signed by
Samaan, with closing costs calculation that met the Underwriting
Condition: “Pricing to be corrected to show 0.75% add to fee for this
enhanced exception program.”, or alternatively - any document or
notation showing the waiver of this Underwriting Condition with author’s
identity, authority, and justification,
d) Any document that provides justification for Maria McLaurin’s actions to
authorize and/or order Field Review on October 25, 2004, prior to
Corporate Approval, and thereby overrule Diane Frazier’s Underwriting
Decision: “APPRAISAL-ACCEPTABLE FIELD REVIEW … will order
after Corp Approval”. or alternatively - any document or notation showing
the waiver of this Underwriting Decision with author’s identity, authority,
and justification,
e) Any document, such as a signed Uniform Residential Loan Application,
fully completed in the appropriate box at the bottom left of page 1
(Position/Title/Type of Business), that met the Underwriting Condition:
”CORRECTED/SIGNED 1003 (At LOCK-IN-RATE) Show type of
business”, or alternatively - any document or notation showing the waiver
of this Underwriting Condition with author’s identity, authority, and
justification, and
f) Any document that met the Underwriting Condition: “BROKER
CERTIFICATION THAT ALL COPIES ARE TRUE AND CORRECT”, or
alternatively - any document or notation showing the waiver of this
Underwriting Condition with author’s identity, authority, and justification.

Uniform Residential Loan Applications –1003 (Freddie Mac Form 65 01/04)

Countrywide produced four (4) different completed Uniform Residential Loan

Application forms, bearing ample indications that they were derived from four (4)
distinct physical documents, two (2) for the 1st lien and two (2) for the 2nd lien
March 19, 2007
Todd A. Boock
Countrywide Home Loans, Inc.
Page 6
loan. These four documents show clear signs of adulteration or tempering with
the intent to mislead:
a) All four documents are marked at the bottom of each page as including four
(4) pages each. The original form (Freddie Mac Form 65 01/04) includes on
page 4 space for additional information, and as section for the Borrower’s
signature. None of the four documents produced by Countrywide included
page 4.
b) All four documents show an original “RECEIVED” stamp, which was crossed
over with black ink to hide the date received, and a substitute “RECEIVED”
stamp, showing the revised date of October 12, 2004. Surely, this does not
meet document security and integrity standards of Countrywide.

This blatant adulteration of documents requires that we demand that you produce
by March 21, 2007 the following:
a) Complete copies of all four (4) applications previously produced, including
page 4 of each, or alternatively produce declarations by the Custodian of
Records that these pages are missing from all four (4) original documents in
your possession. We may also need to coordinate time to inspect the original
documents in your possession.
c) Any and all documents which were attached to these 1003 Applications
providing the author’s identity, authority, and justification for the change of
“date received” stamps on these documents, or alternatively produce
declarations by the Custodian of Records that such attachments are missing
from all four (4) original documents in your possession.
d) The full and complete Imaging History of the complete files of the 1st and 2nd
lien loans, and in particular – the Imaging History of the Uniform Residential
Loan Applications – 1003, and
e) The full and complete Audit Reports of the 1st and 2nd lien loans.
Summary

The reasonably particularized categories of documents that Dr. Zernik has

subpoenaed from Countrywide are absolutely necessary for Dr. Zernik’s defense
of the specific performance claim Nivie Samaan has filed. Indeed, these
documents have a direct bearing on whether Ms. Samaan was capable of
purchasing the Property and/or induced Dr. Zernik to enter into the purchase and
sale agreement through fraud. Countrywide’s failure to produce all subpoenaed
documents or to produce a privilege log for those documents that it claims are
privileged suggests that Countrywide may have actively participated in the fraud
perpetrated against Dr. Zernik and is now taking active steps to conceal that
fraud.

As a result, we demand that Countrywide provide the requested documents by

no later than March 21, 2007. If we do not have the documents by March 21,
2007, we will have no choice but to immediately file the appropriate motion to
compel and request sanctions against Countrywide and/or we will initiate
March 19, 2007
Todd A. Boock
Countrywide Home Loans, Inc.
Page 7
contempt proceedings. Time is of the essence as we are approaching our
summary judgment deadline in the underlying case. We simply cannot have any
further delay as Countrywide has had since August 2006 to comply with Dr.
Zernik’s request.

Please note, it is in Countrywide’s interest to provide the requested documents

as its failure to do so will expose Countrywide to liability for disobedience of the
subpoena and all damages Dr. Zernik may suffer as a result of Countrywide’s
failure to provide the subpoenaed documents.

Should you have any questions or wish to discuss the matter further, please do
not hesitate to contact me.

Sincerely,

ZACHARY D. SCHORR
lv/zds

ND: 4845-8317-7473, Ver 1