The Miami Herald has found the perfect anecdote for the foreclosure scandal, the mortgage crisis, and how both are two sides of the same coin. It’s a stunning story about how a woman refinanced her home to get $50,000, wound up getting defrauded at every turn, and is set to lose it to the bank.

Here’s what reporter Toluse Olorunnipa found digging through Imogene Hall’s court records:

• Johnson Cuffy, a former mortgage broker now serving an 11-year prison sentence for grand theft, handled Hall’s refinancing in early 2006, using a strategy a state investigator described as “outright mortgage fraud.” He faces up to 30 more years in prison if convicted of 16 other mortgage fraud charges he’s facing.

• The title agent who signed the crucial deed transfers that Hall’s fraud claim rests on operated an unlicensed title company that stole more than $1.5 million from South Florida home buyers during closing proceedings between 2005 and 2007, according to Florida Supreme Court records.

• A man who listed his employer as a nonexistent Blockbuster Video store in New York somehow used Hall’s home as collateral to secure a $230,000 loan from subprime lender Argent Mortgage.

• Hall’s foreclosure was processed by the Florida Default Law Group, one of four Florida law firms being investigated by the state attorney general for using flawed documents to repossess homes from thousands of owners.

Oh, that’s not all:

Hall’s foreclosure defense lawyers, in what has become a booming — and sometimes predatory — business, charged her more than $20,000 while regularly failing to show up in court. One lawyer charged Hall $2,800 for work he did trying to withdraw himself from the case.

That’s not all, either. There are inflated appraisals, door-to-door refinance salesmen, rocket-docket judges, egregious fees, theft—all facilitated by the finance industry’s imperative to get junk loans to create toxic securities to sell to investors. It’s all put together seamlessly by the Herald. This is superb journalism.

If there’s a quibble, it’s that the paper doesn’t follow the fraud up the chain enough. It namechecks the lender as Argent Mortgage. What’s that? A unit of Roland Arnall’s Ameriquest, one of the slimiest, most predatory subprime lenders. The investigative journalist Michael Hudson calls Arnall the “one figure that did more than anyone else to grow the subprime market, and grow it into the monster that it became.”

A couple of paragraphs on Argent/Ameriquest would have gone a long way in making this story even bigger. But it’s still a gem.

Next week, global giant Deutsche Bank will be taking over the $80,000 home of a Jamaican immigrant home health aide defrauded by a system it helped create.

Now, I suppose it’s possible that Ms. Hall is just the unluckiest homeowner in the world, the Herald just happened to find her, and her story isn’t really representative of the utter corruption and criminality of the mortgage system.

Somehow I highly doubt it.

— Further Reading:

Boiler Room. The business press is missing the crooked heart of the credit crisis

Power Problem. The business press did everything but take on the institutions that brought down the financial system.

Audit Interview: Michael Hudson. “We’re in a battle now to define what happened.”