Posts Tagged ‘foreclosure fraud’
Posted on June 8th, 2013 by Mark Stopa
There are many aspects of foreclosure-world that are drastically different than other areas of law … things a lawyer would never see in any other practice area. Rocket dockets. Senior judges. Two-minute trials. But one aspect of foreclosures that nobody ever talks about is how the concept of a bankrupt creditor just doesn’t exist in foreclosure-world.
No, I’m not talking about bankrupt debtors. We all know many homeowners facing foreclosure utilize Chapter 7 or Chapter 13 bankruptcy to get rid of debt and give themselves a fresh start. I’m talking about bankrupt banks.
Yes, I know. Many banks have gone bankrupt in recent years. In fact, I’d say at least 90% of the lenders who issued the loans on the cases I defend no longer exist, so I’m quite familiar with the concept of banks going bankrupt.
What makes foreclosures so different than any other area of law, though, is that when a bank goes bankrupt, there’s seemingly always another bank which steps into the picture to claim ownership of that mortgage.
Do you think this concept exists in any other area of law? Pfft. No way.
Think about it. Suppose you hire a roofer to put a new roof on your home, the roofer finishes the job, you don’t finish paying the bill, and the roofer goes out of business. Do you think there’s another company who will chase you down for payment in the place of the first roofer? Heck no. That company is out of business, so you got lucky. You don’t have to pay the debt. It might still be owed, but as a practical matter, nobody is ever going to pursue payment.
This dynamic exists virtually any time you sign a contract with a company for any type of service and the company goes bankrupt and/or out of business. You got lucky, and you don’t have to fulfill your contractual obligations. Well, technically, I suppose you do, but nobody is ever going to call you out if you don’t. The obligations are just … POOF. Gone. In the wind.
I see this dynamic all the time in normal lawsuits. In recent months, for example, I’ve had clients go out of business. No, not foreclosure clients; I’m talking in normal litigation cases. These clients were owed money from various third parties and insurance companies, but they went out of business. Do you think anyone is going to pursue payment from those insurance companies or third parties? Heck no. That’s the reality of the law … the reality except in foreclosure-world.
In the land of foreclosures, banks go bankrupt all the time. We’ve all seen it. Yet there always seems to be another, active bank claiming ownership of the bankrupt bank’s mortgages. There’s seemingly never a time when some bank isn’t willing to say “yeah, that original lender might not exist any more, but we own that mortgage now.”
Some may argue it’s wrong to complain about this. “You borrowed the money, you shouldn’t complain that you have to pay it back.” I think that explanation is just wrong. Sometimes, there absolutely should be a free house because the mortgage company went out of business. It happens in other areas of law, why not foreclosures?
Mark Stopa
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Posted on February 12th, 2013 by Mark Stopa
I’ve noticed a trend in recent weeks in my foreclosure defense practice, one that’s become significant enough that it’s worth mentioning … banks are trying to avoid putting anything in writing under oath. I mean nothing. At all. As in, the case can go from start to finish without anything in writing under oath.
First, a little background … You know the history here. In the process of trying to foreclose on millions of well-intentioned homeowners, banks got caught robo-signing fraudulent documents, particularly affidavits, leading to various problems and sanctions. (Too few sanctions, yes, but sanctions nonetheless.)
So how have the banks responded? By stopping the fraud and cleaning up their business practices? Hehehehe. That’s just silly. To avoid further problems, the banks are frequently trying to avoid filing anything that could be deemed fraudulent. The biggest difference? Affidavits in support of summary judgment are being replaced by trials with live testimony.
What’s the difference, you ask? With an affidavit, there’s a written document in a court file … a paper trail that could be used later to prove fraud. With trial testimony, there’s no written document and, hence, no paper trail to prove fraud. Think of it this way … imagine the Department of Justice wanted to evaluate the proof a bank submitted to prevail in a foreclosure case where a foreclosure judgment was entered 12 months ago. If there’s an affidavit, the DOJ could go to the courthouse and get a copy of the affidavit to assess whether there was fraud. If there’s no affidavit, and the foreclosure judgment was entered after testimony at trial, there’s no paper trail, so the bank has total deniability. There’s nothing under oath in writing that anyone could say is fraudulent. (Yes, I realize these investigations are few and far between, but that’s a different story.)
I’ve also noticed the banks’ reluctance to go under oath when answering interrogatories. Florida law requires that interrogatory answers be given under oath, i.e. under penalty of perjury. Banks routinely answer interrogatories by failing to provide substantive information, and even when they do provide information, the verification on those interrogatory answers is often not under oath. Any lawyer knows interrogatory answers need to be given under oath, so why would a bank sign these answers but refuse to give them under oath? In my view, the answer is simple … banks avoid answers under oath to avoid the potential pitfalls of doing so, including prosecution for perjury.
I’m not saying banks never provide written filings under oath in foreclosure cases. They still do. But the frequency with which they do has definitely decreased in recent months, and I can’t help but conclude these are the reasons why.
Update: In response to a good question about trial testimony being transcribed by a court reporter … many trials have no court reporter, particularly uncontested trials. And for those that do, there’s no transcript unless somebody pays to have it transcribed, which is hard to imagine happening where the case is uncontested. Hence, testimony at trial is a sneaky way to prevent anything in writing, under oath ever being put in a court file.
Mark Stopa
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Posted on July 13th, 2012 by Mark Stopa
I figured out how I’m going to get rich, and I’m so confident it’s going to work that I’m posting it on this blog. Here’s my strategy…
I’m going to go to Office Depot and have them print me a stamp that says:
Pay to the Order of: Stopa Law Firm
___________________________
Without Recourse, Mark Stopa, Asst. V.P. of Foreclosure Documentation
I’ll stamp this on every “original” promissory note I can find, sign my name on the line, and file foreclosure lawsuits on all of these properties, naming Stopa Law Firm as the Plaintiff. If anyone tries to question the legitimacy or authenticity of the endorsement, I’ll simply say “judge, the note is self-authenticating, and I’ve filed the original.” I’ll then shovel in my ill-gotten gains by the millions as hard-working, Florida homeowners get foreclosed, hundreds at a time. By the time anyone questions my nefarious acts, I’ll have sailed off into the sunset, counting my tens of millions, ala David Stern.
OK, back to reality … Does this even begin to sound reasonable to you? Do you think I’d seriously entertain this, even for a moment? Of course not. It’s not only immoral, it’s illegal … and I’d obviously never do it. So why am I talking about it?
Well, this is what banks are doing on a regular basis in foreclosure cases throughout Florida. Instead of procuring the “wet-ink” signatures of agents from the banks that supposedly transferred the notes/mortgages to them, banks are stamping endorsements onto notes, often without the knowledge/consent of the person whose signature the endorsement is supposed to represent.
For example, suppose U.S. Bank transfers a Note/Mortgage to Bank of America. Typically, the way it’s done (or supposed to be done, at least) is a President, Vice President, or other, high-ranking officer of U.S. Bank signs an endorsement on the original Note and transfers possession of the Note to Bank of America. Bank of America then goes to court with the original Note, with an endorsement, and sues for foreclosure.
That’s how it’s supposed to work … only that’s not reality.
In the real world, banks like Bank of America don’t have wet-ink signatures on their endorsements. Instead, they rely on “endorsements” which aren’t signed at all, but are stamped – literally a stamp of someone’s signature … like a stamp you’d buy at Office Depot.
I suppose, in theory, that stamping a signature instead of actually signing the endorsement on a Note could be okay … IF the person whose signature appears is actually the one doing the stamping. For example, if Michelle Sjolander doesn’t sign a Note herself but stamps her own signature, I suppose that’s okay. But do you think it actually works that way? Hell no.
Don’t believe me? Read this deposition of Michelle Sjolander. She acknowledges that she has never actually signed an endorsement and that she doesn’t even know how many stamps with her “signature” exist:
And do you know how many stamps were issued with
11 your name on them?
12 A Not the exact number. But many.
13 Q Could you estimate? Is it more than 10? More than
14 100?
15 A More than — more than 10.
16 Q Less than 50?
17 A I don’t — through the whole years, I can’t even
18 give that answer.
19 Q Okay. And what happens to the stamps? What happens
20 to the old stamps when you execute new stamps?
21 A I collect them and burn them.
Are any endorsements ever what you called wet ink
3 signature where someone actually signs the endorsement?
4 A It is — it is not — not — none of mine have been.
5 Q Okay. How about anyone else’s? Do you have any
6 knowledge if anyone else’s signatures are –
7 MR. TRINZ: Objection.
8 Q BY MS. LUNDERGAN: — physically placed on versus
9 stamping?
10 MR. TRINZ:
Objection. Outside of her knowledge.
11 THE WITNESS: Outside the scope of my business.
12 Q BY MS. LUNDERGAN: Okay. Do you have any knowledge
13 then of that?
14 A No.
15 Q Okay. How long has — you are no longer executing
16 endorsements, but when did you begin executing endorsements or
17 when did they begin using a stamped signature to execute your
18 endorsement?
19 A 2005.
20 Q And how did that arise? Was it something that they
21 asked you to do or was it something that became part of your
22 job position?
23 A Yes. My previous boss had left the company and my
24 stamp was replaced with his.
Nonetheless, the name Michelle Sjolander appears on hundreds, probably thousands, and perhaps tens of thousands of endorsements on “original” promissory notes in foreclosure cases. She hasn’t signed her name, and she didn’t stamp it – but her ”signature” is regularly seen on original notes. Any foreclosure attorney, such as myself, has undoubtedly seen her name dozens of times.
It’s bad enough that she’s not signing or stamping her own name. But that’s not the worst of it. Instead, let me ask you this …
Once you realize that Michelle Sjolander isn’t stamping her own name, and that dozens of stamps with her signature exist, what do you think the chances are that someone from the company for whom she works/worked stamped her signature on the original Notes, as opposed to someone from the company prosecuting the foreclosure case?
Personally, I’m convinced that banks often fail to obtain an endorsement from the bank that “transferred” the “original” Note to them, and merely stamp the Note so it looks like they got an endorsement. Using my example, above, instead of Bank of America getting someone from U.S. Bank to endorse the Note, Bank of America merely stamps an endorsement on the Note itself.
This may well be the next big wave of foreclosure defense. The argument?
“Yes, judge, I see the note is endorsed in blank. But the endorsement is not self-authenticating when we have reason to believe it was not signed by the purported endorser, but that the alleged endorsement was stamped by the plaintiff itself.”
It’s really no different than if I started stamping “Pay to the Order of Stopa Law Firm” on a bunch of Notes, signed them, and foreclosed. Nobody would think that is okay, so why is it overlooked if it’s done by banks?
Mark Stopa
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Posted on May 28th, 2012 by Mark Stopa
I’ve had many clients come into my office recently, having paid tens of thousands of dollars pursuant to loan modification agreements with banks. This Memorial Day, I’m so thankful for the honest bankers who cared enough to work out agreements with these homeowners so as to avoid foreclosure, enabling these allow hard-working homeowners to make monthly mortgage payments and remain in their homes. OH, WAIT.
These hard-working homeowners paid tens of thousands of dollars, diligently made all monthly mortgage payments, and did everything the banks asked them to do to stay in their homes and avoid foreclosures. But the bankers weren’t honest and, and these loan modifications were nothing to be thankful for. It was all a fraud. A farce. You see, these homeowners entered a loan modification agreement and made all of the monthly payments required thereunder, but they got sued for foreclosure anyway, often waiving all defenses to that foreclosure as part of the loan modification!
Please, please don’t make this mistake. Please, please don’t fall into this trap. Please, please, please read these articles:
Tempoary loan modifications are the ultimate scam!
Loan Modifications can CAUSE foreclosure!
Banks Offer Loan Modifications to Dupe Homeowners!
I’m not trying to say homeowners should never do a loan modification. My point, simply, is this … banks know how desperate many homeowners are for a loan modification, and bankers prey on that desperation, resulting in agreements that are terribly one-sided and, yes, even fraudulent. If you’re going to enter an agreement like this, you have to do so with both eyes open.
I could write pages and pages of terms that I think a loan modification should include. I could give horror story after horror story of homeowners who made tens of thousands of dollars in payments yet got sued for foreclosure anyway. Instead, I’ll put it like this … if you’re adamant about entering a mortgage modification, and you have a bank willing to do so, I’d make sure, at worst, of the following:
1. The loan modification is in writing, signed by you and the bank. A bankster telling you over the phone that you have a deal is about as trustworthy as an email from Nigeria telling you that you’ve won $10,000,000 and that you need to mail them a $10,000 check to claim your prize.
2. The loan modification specifically says, in writing, that the bank will not sue you if you make the monthly payments, or, if a suit is already pending, that the suit will be dismissed (upon your entry into that agreement). That might sound obvious, but what good is a loan modification – and what purpose does it serve to mke monthly payments – if the bank can still sue you for foreclosure anyway?
3. The loan modification has some type of written representation from the bank that it is the owner/holder of the Note and Mortgage. Incredibly, I often see loan modifications where the bank asks the homeowner to represent that it is the owner/holder of the Note and Mortgage. This is bass ackwards. The typical homeowner has no idea whatsoever which bank owns that Note/Mortgage – that’s something the bank should have to represent, to the homeowner, so the homeowner has some recourse if it turns out to be false.
4. The mortgage modification is recorded in the Official Records of the county where the property is located. If it’s not recorded (or not in a format that it can be recorded), chances are pretty good that it’s not real.
5. The loan modification agreement does not require you to waive all defenses to foreclosure. If I’ve seen this once, I’ve seen it 100 times. A homeowner is desperate for a modification, so he/she will sign anything, even something that says all defenses to foreclosure are waived upon any default in the modified agreement. This might be kosher for homeowners who know they won’t re-default, but few are in that boat. Even if you really want a loan modification, do you really want to be in a position of not being able to defend a foreclosure because you’ve waived all defenses?
If we all stand up, and insist on these basic terms, then perhaps we can collectively force banks to enter loan modifications that aren’t so one-sided.
Mark Stopa
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Posted on September 17th, 2011 by Mark Stopa
Many homeowners wonder how a foreclosure defense attorney can help when they’re behind on monthly mortgage payments. If I had to explain what I do, and how I help, in just one sentence, it would be this:
I force the banks to prove their case.
That may sound simple, but if it were, then why are banks so reluctant to go to trial? Why do contested cases take so long for banks to prosecute? And when these cases do approach trial, why do banks often dismiss them voluntarily?
Many consumer advocates think the banks are trying to hide something truly nefarious, and in some cases, that may be. More often, though, I think the explanation is more simple – banks struggle to prove an entitlement to foreclose because they lack the requisite evidence.
A wonderful illustration of this is seen in the recent decision by Florida’s Fourth District Court of Appeal in Glarum v. LaSalle Bank. In that case, the homeowner admitted he was in default on mortgage payments but disputed the amount owed. As so frequently happens in foreclosure lawsuits throughout Florida, the bank filed an affidavit in support of a motion for summary judgment, asserting the amount owed exceeded $340,000 (based on data entries in the bank’s computer system). The lower court granted that motion, agreeing the bank was entitled to foreclosure. The appellate court (the Fourth District) reversed, ruling the bank’s evidence – the affidavit – was insufficient to establish a right to foreclose as a matter of law.
In support of its ruling, the Fourth District began with the basic proposition that affidavits and other information used for summary judgment must be admissible in evidence, just as if it were a trial. See Fla.R.Civ.P. 1.510(c). The court then concluded the affidavit was not admissible, and not a basis upon which to grant foreclosure, because, in its words:
[the person who signed the affidavit] did not know who, how or when the data entries were made into Home Loan Service’s computer system. He could not state if the records were made in the regular course of business. He relied on data supplied by Litton Loan Servicing, with whose procedures he was even less familiar. [The person who signed the affidavit] could state that the data in the affidavit was accurate only insofar as it replicated the numbers derived from the company’s computer system. Despite [his] knowledge of how his company’s computer system works, he had no knowledge of how that data was produced, and he was not competent to authenticate that data. Accordingly, [his] statements could not be admitted under section 90.803(6)(a) [the business records exception to the hearsay rule] and the affidavit of indebtedness constituted inadmissible hearsay.
Without an admissible affidavit, the Fourth District concluded the bank was not entitled to a foreclosure and reversed the lower court’s Final Judgment of Foreclosure.
If this sounds complicated, think about it this way. Courts don’t determine the outcome of lawsuits based on information from people who lack personal knowledge of the facts at issue in the lawsuit. For example, I couldn’t go testify as a witness at a trial and say “I didn’t see the car accident, but my friend told me the driver of the blue car ran the red light, and here are medical bills showing the amount of the victim’s medical expenses.” It simply doesn’t work that way. My friend would need to testify to what he saw at the accident scene, and the victim or his doctors would need to provide the proof of the medical expenses.
The situation in foreclosure cases is no different (and, fortunately, the Fourth District did not apply a different set of rules simply because this was a foreclosure case). To establish the amount owed on a note/mortgage, the bank must introduce admissible evidence. Again, this sounds easy, but Glarum shows how this can be a huge problem for banks.
Think about it this way. We all know that, in the vast majority of foreclosure cases, the bank that’s suing wasn’t the original owner/holder/servicer of the mortgage. Consequently, the bank that’s suing can’t simply go into court and say “this is how much the homeowner owes us” without relying on some sort of documents from the prior bank(s)/servicer(s). In other words, as Glarum explains, an employee of the current bank can’t just say “this is what the prior bank told us was owed” or “this is what our computer system says the prior bank was owed.” To prove its case, the current bank would need to introduce evidence from an employee of that prior bank (showing the amount owed), or, at minimum, introduce evidence from an employee of its current bank establishing some sort of legitimate procedure as to how the amount from the prior bank was input into its computer.
As a practical matter, this sort of thing never happens. Banks rely on their own employees to win a foreclosure case – they don’t want to have to track down information from employees of other banks. Heck, sometimes the banks can’t do this, even if they wanted to, because the prior bank(s) no longer exist and/or the current bank doesn’t even know who the prior bank(s) were. (Wouldn’t it be an awesome irony if the MERS system kept banks from proving their cases because they didn’t know which banks owned the notes/mortgages previously and didn’t know who to contact to obtain admissible evidence?)
Lest you doubt this is a huge problems for banks, check out this posting from one of Florida’s foreclosure mills. They’re running scared from the Glarum opinion, desperately trying to sway judges to change this decision due to the negative consequences it would have on banks’ ability to prosecute foreclosures. In other words, the banks want the courts to apply a different set of laws to foreclosure cases because if the law is followed, and banks are made to prove their entitlement to foreclosure with admissible evidence, they will struggle to do so.
Back to my original point. In its simplest form, foreclosure defense lawyers force banks to prove their case – to prove their entitlement to foreclosure. Often, as you’ve seen here, that’s harder to do than you’d think, and that’s why a competent defense lawyer, who is able to point out the flaws in the bank’s evidence at each stage of a foreclosure lawsuit, is so important.
Mark Stopa
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Posted on April 25th, 2011 by Mark Stopa
I want to do something a little different today – give everyone a chance to see what I see and tell me what they think. So here goes. …
Attached, here, is an Assignment of Mortgage filed in one of the foreclosure lawsuits I’m defending. Can you spot the fraud (or what I perceive to be the fraud)? You don’t need to resort to any other documents – you should smell something fishy merely by reviewing this three-page document.
Where’s the fraud?
I’ll post my opinion shortly, in a follow-up blog.
Mark Stopa
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Posted on January 18th, 2011 by Mark Stopa
Kim Miller of the Palm beach Post openly wonders, in this article, why nobody in Florida is doing anything in response to documented problems in the foreclosure process. To illustrate, we’re all familiar with the Florida Attorney General’s power point presentation, appropriately titled “Unfair, Deceptive, and Unconscionable Acts in Foreclosure Cases.” The problem, of course, is that if the foreclosure fraud is this well-documented, why aren’t there any negative repercussions for anyone? Unfortunately, as I see it, nobody will do anything. The AG, despite its investigation into the foreclosure mills, has done nothing. The Florida Bar has done nothing.
But don’t take my word for it – read the article.
By Kimberly Miller, Palm Beach Post Staff Writer
Fed up with the foreclosure chaos, the New Jersey courts demanded that banks prove the integrity of their home repossession systems or face shutdown. To demonstrate the need for the Dec. 20 order, New Jersey cited flaws in six Florida foreclosure cases, including three in Palm Beach County, as examples.
In Nevada and Arizona, attorneys general last month sued Bank of America for a dual-track foreclosure system that offers homeowners hope with a loan modification, while at the same time taking away the home in court. Called deceptive and labeled consumer fraud in the lawsuits, the practice is also prevalent in the Sunshine State. And on Friday, the Massachusetts Supreme Court issued a bombshell ruling against banks’ ability to foreclose on homes – a decision could reverberate nationwide.
The moves by other states to address the foreclosure morass has Florida homeowner advocates and defense attorneys asking why more isn’t being done here. The Florida Attorney General’s Office is investigating four so-called “foreclosure mill” law firms and is part of a 50-state coalition trying to work out solutions with the banks. Also, the Florida Supreme Court assembled a foreclosure task force in 2009 and requires mediation in all homesteaded foreclosures – a program that has logged minimal success in the year since it became mandatory. But as hundreds of homes continue to sell at auction each day and the variations of alleged malpractice mount, critics charge that Florida is burying its head in its sandy beaches, waiting for an ocean breeze to blow the whole thing over.
“This collective turning of our backs and shutting of our eyes is not working,” said St. Petersburg defense attorney Matt Weidner. “I think there is widespread delusional behavior to pretend nothing is wrong.”
And it appears clear something is wrong. Although few dispute that the vast majority of foreclosures are on homes where the borrower has stopped paying the mortgage, a comprehensive presentation given last month by investigators in the Florida attorney general’s economic crimes division meticulously outlines problems in how banks went about taking back those homes.
The report includes pages of allegedly forged signatures, false notarizations, bogus witnesses and improper mortgage assignments. It implicates the banks, their servicers and law firms for contributing to the foreclosure conundrum.
In 2009, Florida had 399,128 foreclosures filed. Between January and October 2010, 224,400 more Floridians received foreclosure notices. The numbers consistently ranked the state in the nation’s top three for foreclosures for much of 2009 and 2010.
“The best thing the state can do to address the foreclosure issue is to create more jobs, put people back to work so they can get back on schedule and pay their mortgage,” said Sen. Garrett Richter, R-Naples, who heard a lengthy foreclosure presentation during a December meeting of the Senate Banking and Insurance Committee, which he chairs.
He empathizes with both struggling borrowers and homeowner associations trying to collect delinquent fees, and believes employment, more than legislation, is the answer to the foreclosure dilemma. “I don’t think we have a massive problem with fraud in the banking industry,” he said.
A spokeswoman for new Attorney General Pam Bondi said the office will wait to see what its law firm investigations find before making a move. But in Florida, even the attorney general’s power to investigate is in question.
A Palm Beach County judge ruled in October that the attorney general’s office doesn’t have the authority under the Florida Deceptive and Unfair Trade Practices Act to investigate law firms . The state has appealed the ruling.
“They all say they are impotent to do anything,” said Mark Stopa, a Tampa-based defense attorney. “Part of why this whole thing has been allowed to continue is because there is very little negative repercussions.”
The Florida Bar says it can investigate individual attorneys only when a specific complaint is lodged, and has no authority to initiate its own query.
Judges are hesitant to point out flaws in foreclosure filings on their own because they say it mars their impartiality, making them an advocate for the homeowner.
Florida’s clerk of court offices are barred from policing the content of the foreclosure cases filed with them, said Sharon Bock, Palm Beach County’s clerk and comptroller.
And in the fall, as bank after bank acknowledged errors, the Florida Supreme Court said it has no power to freeze foreclosures under the state constitution or court rules.
New Jersey has not frozen foreclosures, but six of the nation’s largest lenders are expected at a Jan. 19 hearing to show proof why the courts should not stop their foreclosures.
Florida does not have the ability to follow New Jersey’s lead, said State Courts Administrator Lisa Goodner.
New Jersey’s court administrator is a sitting judge who can issue orders, while Goodner is not a judge and has no such power.
“In Florida, contested and uncontested mortgage foreclosure proceedings must be resolved in the individual trial courts through the normal litigation process,” Goodner said.
Attorney Tom Ice, of Royal Palm Beach-based Ice Legal, said the question isn’t whether Florida can use the exact same mechanism as New Jersey, but whether it can do something to address the problem. He believes it can. “They’ve taken the position that it’s out of their hands,” Ice said of Florida’s Supreme Court. “They don’t have to sit idly by while people make a mockery of the system.”
Mark Stopa
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Posted on January 4th, 2011 by Mark Stopa
I just had the pleasure to read Foreclosure Report from Florida Attorney General. Wow. Just … wow.
To all of you out there who question the existence of foreclosure fraud, you must read this report.
To those of you who wonder whether homeowners could ever have valid defenses to foreclosure, you must read this report.
To anyone who thinks banks are have done nothing wrong, you must read this report.
As you do, bear in mind – this isn’t coming from me, a foreclosure defense attorney, or a “disgruntled” homeowner. This report comes from the Florida Attorney General.
The entire report is awesome, but I particularly like the solutions suggested by the AG:
1. Assuring the integrity to the judicial foreclosure process
– Documents submitted must be true and accurate
– Affidavits must be proper in substance and form
– Assignments must be properly executed and accurate
2. Due Process Rights to the Foreclosed Homeowners
– Proper Service of Process on the Homeowner
– Proper Standing to sue by the Plaintiff Bank
– Substantive review of paperwork prior to foreclosure
Foreclosures will have to go forward, and there will be many more next year, but they need to be done within the law.
Mark Stopa
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Posted on December 11th, 2010 by Mark Stopa
Nationwide Title Clearing is making headlines. First, it obtained an injunction against fellow foreclosure defense attorney Christopher Forest, requiring him to remove video depositions of three of its employees from youtube. Why, exactly? Well, from what I can tell, NTC doesn’t want the public to be able to see video depositions of its employees, who apparently testified that they executed hundreds of foreclosure-related documents without reading them and without knowing their contents. How does that give rise to a right to injunctive relief? Honestly, it beats the heck out of me. My best guess, from what I’ve read in the media, is that the employees who testified in these depositions had their personal lives disrupted because of the high level of public outrage at the content of the depositions.
Meanwhile, NTC has sued my friend and foreclosure defense lawyer Matt Weidner for libel, asserting he damaged its business reputation by blogging that NTC employees are “robo-signers” that “manufacture evidence” to facilitate foreclosures.
Am I crazy, or does anyone else see the hypocrisy here? Think about it.
On the one hand, NTC wants to sue Matt Weidner for damaging its business reputation by using terms like “robo-signer.” In doing so, NTC wants to take the position that everything is on the “up and up” with how it does business (and it was “defamed” by Matt’s suggestions otherwise).
Meanwhile, NTC is fighting vigorously to shield depositions of its employees from the public, pushing for an injunction requiring Christopher Forrest to remove the video depositions from youtube.
As I see it, if everything is on the “up and up” at NTC, as it wants to allege in the suit against Matt, why is it going to such efforts to shield its the public from learning about its operations? In other words, if NTC is being “defamed” by use of the term “robo-signer,” then why is it unwilling to let the public see testimony from its employees about the manner in which they execute documents?
Let’s put it this way. I don’t know what’s going on behind closed doors at Nationwide Title. It seems to me, though, that if everything were up on the “up and up,” as it wants to contend in the suit with Matt, then it wouldn’t be so hesitant to let everyone see and hear what’s going on at NTC from the mouths of its own employees. Show us the depositions. Explain it to us. If you’re an upstanding, reputable company, open your doors and prove it.
Maybe I’m naive. If it were me, though, and somebody was falsely accusing me and/or my company of “manufacturing evidence” or doing something illegal, I’d do whatever I could to prove my innocence. I’d be talkiing to the media, opening my books and records, explaining my company’s operations – doing whatever I could to reveal the truth. I certainly wouldn’t be going to court to try to shield evidence of my conduct.
If you’re reading this, NTC, consider this a challenge. If your employees aren’t “robo-signers,” then terminate the injunction. Heck, give me consent to post the video depositions on this website. Let the public hear your employees testify – let the public be the judge. If everything is on the “up and up,” I’m sure you’ll have nothing to worry about. If you’re not willing to do that, as the injunction suggests, you can’t blame anyone for questioning exactly what’s going on behind closed doors at NTC.
Mark Stopa
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Posted on December 3rd, 2010 by Mark Stopa
I’ve read and re-read the Press Release of Honorable Thomas McGrady, Chief Judge of Florida’s Sixth Judicial Circuit. I understand where Judge McGrady is coming from, and I agree with him in certain respects. In others, however, I respectfully but strongly disagree, so much so that I feel compelled to respond.
First off, I agree that many judges should be commended for “upholding their oath of office” and “following the law.” Florida’s judges are facing an unprecedented challenge vis a vis the incredible volume of foreclosure cases, and many judges have performed admirably, particularly those in the Sixth Judicial Circuit over which Judge McGrady presides. Let’s put it this way – my biggest frustration as a foreclosure defense attorney is that judges so routinely treat foreclosure lawsuits much differently than other lawsuits. With a few glaring exceptions (who I will not name but I’m sure Judge McGrady knows who I’m talking about), the judges in the Sixth Judicial Circuit generally do not act this way, and that’s certainly a good thing.
That said, I respectfully but firmly disagree with Judge McGrady’s broad-sweeping statements regarding foreclosure cases in the entire state of Florida. With all due respect, Judge, you may realize what’s happening in the Sixth Judicial Circuit, but I don’t believe you know what’s happening in other counties, so I don’t think it’s fair for you to criticize anyone who is commenting on events in other counties in Florida.
Every day, it’s a battle for foreclosure defense attorneys such as myself to ensure the most basic rights for homeowners in foreclosure cases. Many times, it feels like we aren’t just battling the banks and their lawyers, but the judges as well. Sometimes, I half-expect these judges, as a hearing concludes, to rip apart their robes and reveal a “Bank of America” T-Shirt exposed underneath. You may think that sounds absurd, but, all too often, that is the climate I’ve seen and felt as a foreclosure defense lawyer in Florida.
You obviously feel passionately that these problems are not pervasive in the Sixth Judicial Circuit, and I’m not going to argue with you about that. Instead, I’ll say this – as for the rest of Florida, you haven’t seen what I’ve seen:
– You haven’t seen a Palm Beach senior judge, at the start of a rocket docket of more than 100 summary judgment motions, assert he’s “heard it all before,” limit the arguments of homeowners and their attorneys to sixty seconds, even going so far as to count down the time as the minute concludes. You may think there aren’t “robo-judges” in Florida, but how else would you define this? Remember – those were summary judgment motions.
– You haven’t seen a senior judge in Tampa let the bank’s lawyer argue for 4 pages of transcript at a hearing on a Motion for Ssummary Judgment, then limit the defense argument to 4 lines of transcript, cut off the attorney after those four lines, and enter summary judgment without reading or looking at the opposing affidavit, written response, motion to vacate default, or motion to stay for military status (justifying his conduct in the face of due process objections by asserting it was “too little, too late” since the case had been pending for two years).
– You haven’t seen Lee County judges systematically and sua sponte require docket soundings in all foreclosure cases, immediately after the cases are filed (without clearing the date with counsel and without allowing phone appearances), and require all discovery be completed in two months, for the purpose of granting summary judgment or setting trial, even though the case is not at issue and the homeowner’s motion to dismiss has not been adjudicated.
– You haven’t been told, by a senior judge in Hernando County, that a plaintiff’s attorney can schedule a summary judgment hearing whenever he wants, without clearing the date with defense counsel (or even knowing defense counsel has a conflict), and that if defense counsel has “a problem with it,” he needs to file a motion to strike the hearing. You didn’t hear this judge assert, when defense counsel complained about the procedure, that it was his “job,” at the instruction of the Florida Supreme Court, to dispose of foreclosure cases as quickly as possible.
– You haven’t tried to set hearings on defense motions in foreclosure cases, only to have court assistants or administrators tell you that the available hearing times were reserved exclusively for plaintiffs’ motions. Of course, there is never a time set aside for defense motions – only for the banks’ motions.
– You haven’t tried to attend foreclosure hearings in Tampa (Section I, on the fifth floor) only to be told those hearings are not open for public access.
– You haven’t received dozens of conformed Orders on disputed matters, ex parte, without notice and without hearing, which most Florida judges sign routinely, even when it is obvious that these Orders are not agreed Orders, usually without giving defense counsel a chance to object. For instance, I once had a situation in Tampa where I prevailed on a motion after a hearing and the Judge entered an Order in my client’s favor, I prevailed on rehearing and the Judge entered a second Order in my client’s favor, yet, weeks later, the bank’s attorney submitted an Order, ex parte, that reversed the Court’s rulings, and the judge executed it before I received a copy in the mail or a chance to respond Respectfully, this never happens except in foreclosure cases, yet in the foreclosure context, it happens routinely.
– You haven’t had a client have a Final Judgment of Foreclosure entered against him – hours prior to the beginning of the summary judgment hearing, then have the judge explain this was her “procedure.”
– You haven’t seen the Administrative Orders in Orange, Seminole, and Lee Counties, which systematically prohibit any phone appearances in foreclosure cases, in direct contravention of Fla.R.Jud.Admin. 2.530, which requires that phone appearances be granted for all hearings of 15 minutes or less absent good cause. (It is my opinion that these Orders exist to make it harder for attorneys to defend homeowners and, hence, to cause more foreclosure cases to go uncontested).
– You haven’t witnessed senior judges routinely reschedule hearings where the defense counsel is present but plaintiff’s counsel is not, yet systematically grant the relief sought by plaintiffs when plaintiff’s counsel is present and defense counsel is not. This double-standard is, respectfully, gross, yet it happens on a regular basis throughout Florida courtrooms in foreclosure cases.
– You haven’t successfully argued that a summary judgment hearing should be stricken from the calendar, had plaintiff’s counsel cancel that hearing pursuant to the court’s Order, yet have a senior judge enter a Final Judgment of Foreclosure (even though nobody was present at the hearing) because she did not even look in the court file or the docket, so she did not see that the hearing had been cancelled.
– You haven’t watched a Brevard County judge repeatedly chastize foreclosure defense attorneys for filing motions to dismiss, arguing it was a “waste of time” and that counsel should be “trying to settle the cases,” then, when counsel responded that the motions to dismiss were sometimes granted, angrily retort that “accomplished nothing” because the bank could amend or re-file. Of course, this judge gave no explanation how it was possible to “settle” cases with banks when judges such as himself make it so apparent that he is hostile towards homeowners.
As I re-read your article, Judge, I’m troubled at the apparent insinuation that recent media reports and news stories are not based on fact. Generally speaking, they are. The media is not making up stories about foreclosure fraud and robo-signers. These stories exist because of real events that have happened to real people. Hence, the problem, in my view, is not that the media or foreclosure attorneys have misled the public into a negative perception about the judiciary, but rather that there are legitimate problems in how foreclosure cases are being handled in our courts. That sounds harsh, but, respectfully, if nothing were amiss, then there would be no news stories.
Essentially what I’m saying is this – I hear what you’re saying in your article, but I respectfully submit that your assertions, as well as your target audience, are misplaced. Instead of trying to speak to the public at large, and assure them the judiciary is fair through your words, prove the judiciary is fair through actions. Prove it by influencing other judges, throughout Florida, to handle the foreclosure crisis more like the Sixth Judicial Circuit. Convince Lee County to stop issuing those Orders setting docket soundings at the inception of a case. Tell Orange County to stop prohibiting phone appearances. Help all Florida judges realize that disputed Orders should not be entered ex parte, even in foreclosure cases. Convince all judges that it’s not fair to reschedule hearings where plaintiff’s counsel does not attend but to rule for the plaintiff when defense counsel does not appear. Suggest that the Florida Supreme Court amend the rule on lack of prosecution in foreclosure cases, so as to dismiss foreclosure lawsuits that are languishing.
As I see it, if you can use your influence to help fix the problem, you won’t feel the need to issue press releases like the one you did, as the public’s perception of the judicial system will take care of itself.
Mark Stopa
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