White-Collar Crime

Fla. AG Probe: Did 3 Law Firms Get 1,000s of Foreclosure Judgments By Possible Wrongdoing?


The economic crimes division of the Florida attorney general’s office is investigating whether possible wrongdoing by three law firms may have played a role in obtaining thousands of mortgage foreclosure judgments.

“On numerous occasions, allegedly fabricated documents have been presented to the courts in foreclosure actions to obtain final judgments against homeowners,” says a press release from Attorney General Bill McCollum announcing the investigation.

“Thousands of final judgments of foreclosure against Florida homeowners may have been the result of the allegedly improper actions of the law firms,” it continues.

The AG’s office is also investigating whether the law firms may have “created affiliated companies outside the United States where the allegedly false documents are being prepared and then submitted to the law firms for use.”

The three firms are the Law Offices of Marshall C. Watson in Fort Lauderdale; Shapiro & Fishman; David J. Stern’s firm in Plantation.

Watson declined to comment yesterday on the probe and the Shapiro firm could not be reached. However, attorney Jeffrey Tew of Tew Cardenas in Miami said his client, David Stern, has done nothing wrong and will cooperate fully with the AG’s probe, reports the Palm Beach Post.

“There is a terrific problem with the collapse of the market and David, who is representing banks legitimately trying to foreclose on a property, gets fingers pointed at him,” Tew told the newspaper. “David doesn’t do anything outside of the circuit court where a circuit judge supervises everything that happens.”

He also wondered aloud whether McCollum, who is a Republican candidate for state governor, could have been influenced by political considerations.

More than 30,000 foreclosure cases were filed in Palm Beach County last year, compared to only 3,252 in 2004, the newspaper notes.

In pursuing the probe, the Miami Herald reports, the AG’s office has issued subpoenas requesting, by the end of the month, what the newspaper describes as “reams of paperwork” dating back at least to the beginning of 2008.

“Law firms are not immune to Florida deceptive and unfair trade practice” laws, said McCollum, during a press conference, the Herald recounts. “I want law firms to really think about it,” McCollum said, “before they go through this volume.”

The Herald spoke with attorney Gerald Richman of West Palm Beach, who said the AG has no basis to investigate his client Shapiro & Fishman but promised that the law firm will cooperate with the probe.

Related coverage:

ABAJournal.com: “Small Foreclosure Firm’s Big Bucks: Back Office Grossed $260M in 2009”

ABAJournal.com: “‘Like Hamsters in a Cage’: Foreclosure Firm Cut Corners to Make Money, Story Says”

ABAJournal.com: “RICO Suit Seeks Billions from David Stern and His Foreclosure-Mill Law Firm”

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