Florida attorney general’s attempt to subpoena foreclosure mills stalls

Pam Bondi's office was cleared of wrongdoing for firing two lawyers.
Wilfredo Lee/AP

Pam Bondi’s office was cleared of wrongdoing for firing two lawyers.

 Theresa Edwards (left) and June Clarkson, who led Florida’s foreclosure fraud investigations, were routinely praised in performance reviews before losing their jobs.
Taylor Jones/The Palm Beach Post

Theresa Edwards (left) and June Clarkson, who led Florida’s foreclosure fraud investigations, were routinely praised in performance reviews before losing their jobs.

By Kimberly Miller Palm Beach Post Staff WriterUpdated: 11:30 p.m. Thursday, Feb. 2, 2012
Posted: 10:50 p.m. Thursday, Feb. 2, 2012

Florida’s once-heralded foreclosure mill investigations have fizzled as the attorney general’s office has failed to find the right strategy to continue its pursuit and three law firms call for the cases to be dismissed.

This week, an attempt to have the Florida Supreme Court weigh in on whether the state has the authority to subpoena the Law Offices of David J. Stern was denied by the 4th District Court of Appeal.

The decision effectively ends the investigations into complaints that the firms doctored court paperwork in an attempt to speed foreclosures.

“It means the buck has stopped” with the appeals court, said Royal Palm Beach-based foreclosure defense attorney Tom Ice. “No appeal to the Florida Supreme Court.”

Even before Wednesday’s ruling – from the very beginning of the investigations – there has been uncertainty about how to prosecute a civil case against the firms.

In 2010, flooded with complaints about unbridled foreclosures, former Assistant Attorneys General Theresa Edwards and June Clarkson said they felt their only option to protect consumers was to go after the law firms under the Florida Deceptive and Unfair Trade Practices Act.

The act governs trade or commerce, but it is unclear whether it can be used against law firms. Attorneys for the firms argue that what they are accused of did not qualify as “trade or commerce” and that the statute is intended to protect consumers. Technically, the consumers were the banks, they say.

Now, more than a year and a half after the investigations were announced during a news conference convened by former Attorney General Bill McCollum, Edwards and Clarkson have been fired, two of the firms have closed, and it is debatable whether there is a legal path to hold the Florida firms accountable.

“This denial is significant,” Attorney General Pam Bondi’s office said in a statement. “The attorney general’s office will now assess each of its seven pending investigations into law firms for potential misconduct in foreclosure cases to determine whether there are other avenues through which the office can pursue foreclosurerelated misconduct.”

In interviews taken as part of a state inspector general’s inquiry into the May firing of Edwards and Clarkson, one leading investigator said that despite increased resources dedicated to the investigations, the state was not close to filing formal complaints.

“The Florida Office of the Attorney General still cannot figure it out,” the January report paraphrases former Chief Assistant Attorney General Robert Julian as saying about why Edwards and Clarkson shouldn’t be blamed for an inability to build a case against the firms.

The Tampa-based Florida Default Law Group points to the inspector general’s report as evidence of why the cases should end.

“It is our understanding that the attorney general’s investigation into our firm has been completed and now that the Office of Inspector General report shows the lack of any substance supporting the investigation, it should be dismissed,” said Ron Wolfe, Florida Default Law Group managing partner.

Attorney Gerald Richman, who is representing the Boca Raton firm of Shapiro & Fishman, agrees.
“I think it’s in everybody’s interest for this to be closed as soon as possible,” Richman said.

The Law Offices of Marshall C. Watson in Fort Lauderdale settled with the state last year for $2 million. Stern’s firm and the Ben-Ezra & Katz law firm have closed, but are still under investigation. Also under investigation are Albertelli Law, Law Offices of Daniel Consuegra and Kahane & Associates.

In December, after losing an appeal in the 4th District Court of Appeal to subpoena Stern, Bondi asked the court to certify its decision as one of “great public importance” so she could appeal to the Florida Supreme Court.

But some foreclosure defense attorneys believe the move was a hollow gesture to appease critics.
Instead of looking to the Supreme Court, Bondi’s office could have issued subpoenas under a different statute, possibly criminal investigative subpoenas, Ice said.

“But the attorney general’s office hasn’t availed itself of that opportunity, which leads me to believe the certification request was a mere pretense for political purposes,” he said.

Edwards and Clarkson, who were forced to resign in May despite exemplary evaluations, said the attorney general’s office is trying to make it appear it has no power. But Edwards acknowledged that taking on law firms is tricky and the legal avenues to pursue a case were in constant debate.

Still, with consumer complaints coming in daily, Edwards said they were frustrated by the lack of a clear course and tried to find a way to “shoehorn” the concerns into the 501 statute.

“Otherwise, here we are, the attorney general’s office, and we were unable to do anything,” Edwards said.
Despite the apparent legal defeat, Edwards and Clarkson said they are proud they helped bring national attention to the foreclosure processing issues.

“We still feel we accomplished a lot, and different people have picked up that torch,” Edwards said. “We woke up the entire country.”

What is a foreclosure mill?
A high-volume law firm accused of taking illegal shortcuts to repossess Florida homes in machine-gun fashion.

Accused of faked signatures on court documents, falsified notarizations and back-dated paperwork.
Some imploded after state investigations, leaving tens of thousands of foreclosures in limbo as they were transferred to new attorneys.

hey this is not a problem.
Every foreclosure defense attorney int Florida jus insists that every bank must provide a person in deposition to swear that they have seen the original loan documents, and can produce them, at trial and can prove that the foreclosing entity has the right to the documents.
Under oath, in court, penalty for purjury is jail time.
ed Campbell
If anyone does not beleive that JUDGES AND ATTORNEYS protect the alleged illegal conduct of other attorneys, here is proof positive.

File a Bar Complaint? No way. The FLa Bar keeps complaints CONFidential! How can the public be protected from lawyer crooks like this when the bar won’t tell you anything about complaints on file against a clearly bad attorney?

The Fl Bar is allegedly a PROTEction Racket. Attys pay dues for protection.

Craaaap Lawyers are the vermin of S. Fl.

Protection Racket Lawyer x 2
Pondi is Scotts Puppet and Scott was paied to do the bidding of the Banks! He has made it clear that his administration is here to do thier bidding and its a sad day for every Floridian! Just as sad is the day when everyone gets thier insurance policy renewals for both Auto and Home and they ROSE OVER 35% for everyone in Florida at Scotts request!
Pam Bondi does not care about Florida residents, all she cares about is big money .
So, as usual, the banks will go free while the homeowners suffer. Why won’t the banks realize that at this poing in the crisis, there’s no point in foreclosing on more homes. They need dto start workig wtih delinquent homeowners. Still, no one will every pay for their sins. That’s the American Way.
Banks go free
What a joke! – Here’s the summary – Banks hire firms to foreclose for them, Firms flat-out cheat and manipulate to process the deal. Homeowners get screwed. When homeowner stands up and demands justice, the FL Bar turns a blind eye. “Nothing to see here, move along”. Big Firms criminal acts are dismissed in the eyes of the FL Bar. “That can’t be happening…”

What other business is goverened by itself – FL Bar should be ashamed.

I work for a foreclosure law firm and I worked at omt of the “mills”. What the public does not know is that these people in foreclosure didn’t pay their mortgage..tada! you’re in foreclosure. There are people that haven’t paid their mortgage in 10 years …go in and out of Bankruptcy. They don’t attend hearings, don’t do load mod…and then after the sale then they want to try and do something. I understand that some people lose employment….
lady b
That’s because most companies hire off shore. So America doesn’t have jobs anymore. When the Attorney General was doing the “investigation” in ’10 and it “stopped” after he loss the election and 1500+ people lost their jobs. Not all firms are fraudulent. But when you have such a large load of cases , you can set your firm up where everything gets done faster. foreclosure takes a about a year to complete. point blank- the media is getting sympathy for people who dont pay their bills.
lady b
At what point will Pam Bondi get the boot? Clearly incompetent and pro bank, she needs to go. She has failed Florida miserably- non judicial states have accomplished a whole lot more in the way of fighting bank/stty fraud than she has attempted. She’s dangerous to Floridians, and NEEDS TO GO. She is an embarrassment to the state of Florida.
Bondi’s appeal to the 4th Circuit was a sham — a wink and a nod — intended for political cover, to make it appear that she was powerless to do anything about the problem.

Well, look at New York, Delaware, New Jersey, Nevada, California, Massachussetts, and now even Illinois — these states’ AGs are DOING something about the problem, and not just civilly but also CRIMINALLY.

Some of these law firm principals — and their banker clients — need to be doing the perp walk.

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