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Nationwide Foreclosure Investigation; Young People Election Disconnect; Fewer Job Openings; Identity Theft; Black Americans Ancestry Search; Tracking Applications

Aired October 23, 2010 - 09:30   ET


CHRISTINE ROMANS, HOST: The countdown is on. Ten days until the midterm election, and we're taking America's pulse. The issues you care about and why you just might be voting with your wallet.

Don't be a victim, 10 million Americans experience identity theft every year. What you need to know to stay safe, today.

And tech or treat? The best new technology to keep your kids safe this Halloween.

YOUR BOTTOM LINE starts right now.

The massive foreclosure investigation moves forward with the attorneys general in all 50 states investigating foreclosure processing. They're investigating whether homeowners were evicted by banks without the proper review process and procedure.

Now, a federal taskforce investigating five big mortgage companies has uncovered some bad foreclosures. But the U.S. Housing secretary says the probe has not yet found any systemic problems so far.

The uproar is over robo-signing, where banks rubber stamped foreclosures without even looking at homeowners' records. Sounding the alarm first, one attorney, in a small town in Maine, who noticed something fishy in his client's paperwork.

CNN's Mary Snow traveled to Maine and joins us now with the details.

This is an amazing story, just one attorney noticing this.

MARY SNOW, CNN CORRESPONDENT: It really is, Christine. And retired attorney you're about to meet, suspected for awhile that foreclosures were going through without being thoroughly reviewed. But it wasn't until he volunteered to represent a homeowner that he was able to connect the dots.


(voice-over): It's an unassuming house in rural Maine, but beyond its small frame is a foreclosure fight that set off a chain reaction of banks halting foreclosures in nearly two dozen states and it all started with this man, Attorney Tom Cox. THOMAS COX, ATTORNEY: I didn't know this case would do it. I thought it would take a lot more effort.

SNOW: Among the stacks of foreclosure cases that Cox volunteers to work on, he noticed a red flag in the first line of an affidavit.

COX: All he's telling us here is that he's a signing officer. He signs papers, and that's -- that was the first clear signal that there was a real problem.

SNOW: Cox tracked down the signer from mortgage servicer, GMAC, named Jeffrey Stefan (ph), who worked outside Philadelphia. Cox then traveled there in June to take a deposition.

COX: I asked him, do you have personal knowledge of what is contained in your affidavits? And when he said he didn't, as a lawyer, that's just staggering.

SNOW: Stefan also admitted to signing 6,000 to 8,000 documents a month. The case moved to Maine district court, GMAC tried to prevent Cox from sharing the deposition. A judge said no to that request and also found the signer acted in bad faith. GMAC, now Ally Financial, became the first of several banks to freeze some foreclosures. An Ally Financial a spokeswoman tells us: "Any case with a defective affidavit is being reviewed and fixed before moving forward."

(on camera): The family who lives here admits they haven't been able to pay their mortgage in the last two years, they've fallen on hard times, they couldn't keep up with the payments, but they've been able to stay here because their case has now turned into a lengthy legal battle.

(voice-over): And Cox fights on. While Ally Financial says it hasn't found any errors in its review of documents, Cox says he's troubled by what he calls an abuse of the legal system. And there's another thing driving him -- his past. He once worked for a main bank where he had to call in loans and execute foreclosures.

COX: But, it was not pleasant work to do, so this has been a chance the last couple of years to do what I think is really good work and maybe to make up for some of the difficulties I caused for a few other people back in the '80s and '90s.

SNOW: In 2010, he says he never expected a fight over a modest, small home would have such big implications.


SNOW: Now, Bank of America said this week after its review, it's moving forward with foreclosures in nearly two dozen states. Ally Financial says it's reviewing foreclosures on a case-by-case basis. But if you ask Tom Cox, he says this isn't the end of the problem by a long shot.

ROMANS: I mean, just if you do the math, if you're talking about somebody signing off on foreclosures for the bank at a rate of 6,000 to 8,000 a month, that comes down to rubber stamping 54 foreclosures an hour, that's assuming that's all you were doing was that.

SNOW: Right, no breaks, we don't know how many hours.

ROMANS: Well, that's really remarkable to think of just how quickly those foreclosures were going out the door. All right, well hopefully they're going to be spending a little more time reviewing them from now on.

Mary Snow, thank you very much, Mary.

Some other mixed news for you in the housing market. New home construction surged to a five-month high in September. That's the highest level since government home buying tax credits ended back in April. But building permits, an indicator of future construction, fell to their lowest level in more than a year.

The countdown is on, 10 days to go until the midterm elections. Next, what your vote is really about, for a specific candidate, or against the economy.


ROMANS: This is the time for you to weigh your vote and decide what issues are important to you in the midterm election. We want to know what you're thinking.

That's why T.J. Holmes jumped on the CNN Election Express this week to talk to Americans about exactly what's going to make them pull one lever over the other this Election Day. T.J. Joins us from Gainesville, Florida.

What are you hearing out there on the road, T.J.?

T.J. HOLMES, CNN CORRESPONDENT: Well, I'm hearing some discouraging news. There's been so much talk out there, of course, about the young people, the young vote, how critical it is these days. And the young people right now don't seem to be too engaged. Sorry to say that.

They, of course, were. They came out in big numbers for Barack Obama back in 2008 because they could see it. They could see what they were voting for, the change they were voting for and believed in.

But this time around, it's a little more difficult for them to define. And a lot of people, like the ones we're finding on the University of Florida campus, young people, they have to worry about graduating here in a year or two or three. They're hoping the economy will improve, but they don't have a lot of hopes for that.

So you would think they're really engaged in these midterms and what's at stake. However, what we're finding, they're not really. Take a listen to this.


UNIDENTIFIED MALE: Graduated in May. HOLMES: In May?


HOLMES: So this is still in the midst of this whole economic downturn and what not and then all the news reports about kids. I'm sure some folks stayed in school a little longer, they went to law school, maybe went they graduated.

UNIDENTIFIED MALE: My friends don't have jobs and they been graduated longer than me.

HOLMES: Really? What happened with you? You just got lucky maybe?

UNIDENTIFIED MALE: You could say I got lucky or I was just good, but you know --

HOLMES: What did you say?

UNIDENTIFIED MALE: I like to say I'm good. But I think I might have got a little bit lucky.

HOLMES: How closely you guys following these midterms?

UNIDENTIFIED MALE: Not too closely.

HOLMES: Now, why not? Why not?

UNIDENTIFIED MALE: When you work 60 hours a week, there's not that lot of time for anything else, you know. I mean, it's all business, here.


HOLMES: So you hear it there, Christine, and it is awfully discouraging to hear it.

Same thing here on the University of Florida campus. Talked to the head of the College Democrats and College Republicans. And you know what? They are together on one issue, at least. That issue being they are just having a hell of a time trying to get young people engaged and involved. They said they've even offered to pick kids up, literally, and take them to the voting booth and still, sometimes, that doesn't work.

But these kids have a lot on the line. But in midterms, it's very difficult to try to get them to understand how much is at stake for them in their future.

ROMANS: T.J. Holmes in Gainesville, Florida. Thanks, T.J.

All right, "The Best Political Team on Television" raring to go on Election Day. Gloria Borger is CNN's senior political analyst in Washington.

And Gloria, we know the statistics, there are 4.6 job applicants for every opening in America.


ROMANS: Is there any way that's not the most important thing on people's mind when they walk into the voting booth?

BORGER: I think it is an important thing and I think people who are going to vote are worried, frustrated, angry. When you look at the polls, the polls show that by a two to one margin, people in this country think things are going in the wrong direction, not in the right direction.

And the problem for the Democrats and for the president, quite frankly, is that the best they can come up with is, look, if we hadn't been in charge actually, things would have been worse not better. And that's kind of a hard thing to get your arms around when you are, you know, when you're a voter. You know, you want to see things get better, you don't want -- you don't want to say, well, they could have been worse. So it's a real problem for them.

ROMANS: So when someone -- here's my question -- the votes they're casting. Do we know people are telling us how uneasy they are about the economy -- when they're going to cast their vote. Are they casting their vote for a candidate or against the economy?

BORGER: You know, I think they're casting a vote against the economy. I think this is very much a yes or no election. Yes, you like the way things are going. No, you don't like the way things are going. Now, in individual cases, for example, in the state of Delaware, you've got Christine O'Donnell who has been quite controversial. I think people may cast a no-vote because they're taking a closer look at some of -- for example, some of the Tea Party candidates in the Senate. But generally, this is sort of an anti- Washington, anti-establishment, we gave you a shot at it, and we don't like what we see. So we're going to give the other folks a chance. Just yes or no.

ROMANS: Gloria Borger, thanks, we'll be watching, of course.


ROMANS: Thank you.

Next, why smart is the new rich. We'll show you how to protect yourself from identity theft.


ROMANS: National Protect Your Identity Week is just wrapping up, but safeguarding your personal information is really something you got to be concerned about all year round. With nearly 10 million people falling victim to I.D. theft each year, there's some steps to ensure you're not one of them. Ten million is a lot of people. It means we're really noticing here, right?

Gail Cunningham is with the National Foundation for Credit Counseling in Dallas. She says whenever there's 10 million of anything happening, that means we've got to take advantage.

Look at by the numbers, I mean, the average victim was $1,800 in goods and services and spends 30 hours trying to recover their I.D.

GAIL CUNNINGHAM, NATIONAL FOUNDATION FOR CREDIT COUNSELING: Well, you're exactly right. And if anyone out there listening today thinks that they are not at risk of being a victim of identity theft, they're probably going to be the next victim. We all need to take this very seriously as the crooks at this time of the year with the holiday season approaching, they crawl out from under their rocks because they know that we are ripe for being distracted at the malls, we're going to be in a hurry and all of that's going to give them more opportunity.

ROMANS: It used to be that we were worried about having our wallet pick-pocketed or maybe even our mail being stolen, but we've gone way beyond those days. Now, our information is in so many different places, Gail, and we sometimes very willingly are giving it. That there's a lot about us that's out there ripe to be reinvented for someone else to use.

CUNNINGHAM: You're exactly right. And those old-fashioned ways of stealing our identity are still alive and well, but we need to be heads up about the new ways, and one is the social media. As much fun as that can be keeping up with friends and family and maybe even looking for a new job, we need to be cautious about what put out there openly about ourselves.

For instance, if we say that we're going on vacation and we'll be gone for a week, you might as well put a neon sign in front of your house saying come on in, take everything, help yourself to what's mine.

And also know that you have to be careful with your entire family, educate them. Even the children may unwittingly put information online that compromises the entire family. And the crooks love this because it's perfectly legal for them to search social media Web sites and find information about you.

ROMANS: So what you say, you have to think like a crook. When you're doing -- especially watching maybe your teenage child and how they're interacting online, think like a crook. What kind of information is out there that that crook can use? It's why it's so important to be looking for your annual credit report to catch if there's something that goes amiss during the year. Tell us about that.

CUNNINGHAM: Absolutely. is the only legitimate site from which you can get your credit report each year, once every 12 months, from each of the three bureaus. And to be a savvy consumer and watch for identity theft, I suggest that consumers stagger those requests. Get one now from one of the bureaus, wait four months, get it from another bureau, wait four months, get it from the third bureau and then start all over again. Review your report, check for any new accounts that have been opened or certainly charges made to your existing account. ROMANS: Gail, first thing you do if you think you've been the victim of identity theft. I assume you contact authorities, right?

CUNNINGHAM: Absolutely. You're going to need to do several things. One, of course, call your creditors and shut down those accounts and consider putting a fraud or freeze alert on your account. Also, contact the credit bureaus and file a police report. You may need that police report to legitimatize the theft and get any information removed permanently from your credit report.

ROMANS: All right, Gail Cunningham, National Foundation for Credit Counseling.

While we're on the topic of your identity, black Americans trying to trace their roots could end up at road blocks that only DNA testing can bust through. But with so many companies offering these texts, do you need to do several tests, which cost several hundred bucks apiece to get a well-rounded picture of your answer? Stephanie Elam is here to tell us what she found.

You did this.

STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: I did this. And you know, I have to admit, this is one of those stories, Christine, it's kind of a passion piece for me, you know, just really figuring this out. And I've always wondered if I take one DNA test, is it going to tell me the whole story or do I need to do a bunch of them? So I did it, three different tests, working with three different companies. And if you take a look, you'll see what I found out about my family.


UNIDENTIFIED MALE: This swab envelope --

ELAM (voice-over): I'm going on a journey to find my roots by taking DNA tests from three different companies,, 23andMe, and The question is, will these tests give me the same results?

JOANNA MOUNTAIN, 23ANDME: Each of us has surprises hidden in there.

ELAM: First up, my mom's DNA, which each company traced back to Africa. AfricanAncestry told me I have the same DNA as the Jola (ph) people in Guinea-Bissau, today. On my dad's side, the results why in sync, but unexpected.

MOUNTAIN: What this is showing is R1B, which a line of very, very successful European men. The relatives there that we know of is John Adams.

ELAM: John Adams! John Adams?

(voice-over): But Mountain put that into perspective.

MOUNTAIN: It's the most common line in Western Europe. ELAM: Oh. But here's my dad. So why are his results so European?

MOUNTAIN: Many African-Americans have at least one paternal line that traces back to Europe because of the relationships between probably between slave holders and slaves.

ELAM: So while perhaps shocking, history helped me understand the results. But the lack of a family history is often a reason why blacks trace their roots.

GINA PAIGE, AFRICAN ANCESTRY: We're the only group in this country that can't point to a country of origin, the only ones. And so that's why DNA testing for ancestry has particular importance for us historically and psychologically.

ELAM:'s John Pereira points out there's more to everyone's story than just DNA.

JOHN PEREIRA, ANCESTRY.COM: You really need to look at not just the DNA, whether you get that at or some other DNA service, but you really look at all of the family history.

ELAM: Genealogist Anastasia Tyler did reveal history about my dad's father, Rolland, his father, John, and his father, Creed.

ANASTASIA TYLER, ANCESTRY.COM: You have such strong people in your family tree. You look at Creed and John who go from not being able to read to owning land, you know, born into slavery and then becoming landowners, always improving themselves. It's quite a legacy that you have.

ELAM: A legacy that's not just part of black history, but American history.


And you know, what you saw there is really quite the American story. It's not uncommon. In fact, Gina Paige from African Ancestry told me that they find that when they do test people, about 35 percent to 40 percent of the people come back with a white paternal ancestor and it really doesn't matter what color you may be now. She said, you may look like Wesley Snipes or Mariah Carey, on either side of the spectrum; you could still end up having a white paternal ancestor.

So, it really just shows you, Christine, how much of an American story this is. But I will say this, once you get started, it's very hard to stop, because I've got all sorts of questions now about what happened to Edna, my third grandmother, and also finding out on my mom's side about more of that trace and see if I can trace it back to Guinea-Bissau and actually visit the country. So, once you get going, it's really hard to stop.

ROMANS: And genealogy is addictive. We all know it's addictive, when you throw the DNA testing on top you can really start to pinpoint things. And it's a couple hundred bucks a piece for the tests? ELAM: Right, and each test is separate for your mom's side and dad's DNA. So, each one of those is a separate test. But overall, I think, if you have African ancestry it does behoove you to go to a company that will look for this certain trackers like that, but overall they're going to give you the same results, because the science is the same, what they're look for and how it's analyzed is different.

ROMANS: All right, Stephanie Elam, fascinating piece. Thanks Stephanie.

ELAM: Thanks.

ROMANS: In case you missed it Thursday night, you can catch an encore presentation of "BLACK IN AMERICA: ALMIGHTY DEBT," that's tonight and tomorrow night at 8:00 p.m. Eastern only here on CNN.

Next, trick or treat? The best, new technology to keep track of your kids while they're out and about this Halloween.


ROMANS: All right, Halloween just a week away. While trick or treat, exciting for the kids, it can create potential nightmares for parents, but there are ways to keep your children safe and put your mind at ease and make it track or treat. John Abell, New York bureau chief for

You can track your children with all of this technology out there. It's a fascinating, especially if you're thinking about teenagers who are still, you know, old enough to do it on their own, but not so old that you don't want to know what they're doing.

JOHN ABELL, WIRED.COM: Right. And the good news is here is you have a cooperating person, everybody likes their iPhone, their Blackberry, whatever, they're going to have it with them anyway, so it might as well be reporting out and keeping mom's mind at ease.

ROMANS: So, tell me how this works, because there are applications, their iPhone is in their pocket and it's telling me at home, where I'm hovering, where three teenagers are out somewhere and it's telling me that they're going 85 miles an hour on Route 17?

ABELL: Well, actually there are applications that will tell you if your child or the person holding the phone or the phone is exceeding the speed limit and all sorts of other things like that. Basically the idea is that these phones all now have sort of a GPS- like capabilities and these applications build on that, so the phone is telling everybody where it is so you can convert that into a dot on the map, you can turn that into a text or a tweet or anything --

ROMANS: Let's talk about some of the applications that already there to track your kids. Mobile me, Google Latitude, Family Map. We're going to put these up so you can see what they are.

ABELL: Mobile Me is the Apple service which does lots of things, it's basically there to sync your stuff to the cloud. But it allows you to find your iPhone. You can easily imagine that you can find someone else's iPhone, if you have their user name and password. So, what you do is you say, a child, give me your user name and password and then I can always find you based on where your phone is.

Latitude is a similar thing, it's a Google product. There's no option, there's no software, you go to a Web site, you connect with your friends, and you can see where your friends are on the map all over the world. You can see them in motion. The map updates dynamically, so if they're in a car it kind of zooms along. It's all 2-D, but the point is that you can see on a map, on a grid, exactly where the person is.

ROMANS: And some phones even can be used as a mobile webcam, so you can see what your kid is seeing.

ABELL: Sure, right. Yes. This is also really of the shelf stuff you, and so you can download an app and you can turn on the -- utilize the film's forward facing camera, stick that in your pocket, you know, the phone part, the lens is a tiny part, have that poking out and you can see the point of view of the person with the camera brought as a webcam. It will go to a Web site and --

ROMANS: I love how this (INAUDIBLE) -- there's a saying, you don't want your mother to hear you say, well, don't do anything you don't want your mother to see. She can see it.

ABELL: Well, the capacity for intrusion is here is enormous. I mean, there's tremendous privacy issues, here. But in the context of keeping track of children or a loved one or anything like that where both parties are sort of agreeing to this, it's fantastic. I mean, there's never been anything like that.

ROMANS: Yes, I'm not talking about spying on your spouse, here. I'm talking about the kids. Only your kids, here. But you also say, Twitter, Facebook, FourSquare, all so good ways to track kids, too. There are apps to help out with all of that. Fascinating frontier, isn't it?

ABELL: It sure is.

ROMANS: All right, that's going to wrap things up for us this morning, but don't forget to tune in to YOUR MONEY today at 1:00 p.m. Eastern for new information on your 401(k) fees.

But right now T.J. Holmes and Suzanne Malveaux have a check of your top stories. CNN Saturday continues right now.