Foreclosure Fraud Bombshell – Thousands of Pennsylvania Foreclosures Could Be Void

Hmmm, I wonder where else this happens??? /sarcasm

Thousands of Pennsylvania Foreclosures Could Be on Shaky Ground

Two Pennsylvania cases, one state and one federal, have exposed new types of document problems in foreclosure cases. One of the cases has potentially transformative consequences for thousands of troubled Pennsylvania homeowners. At the center of each is the same law firm: Goldbeck McCafferty & McKeever (GMM).

A lawsuit filed by Patrick Loughren against GMM details how the firm allowed — and perhaps still allows — nonlawyers in its firm to file and prosecute thousands of foreclosures.

Kimberly A. Robinson v Countrywide Home Loans, BAC

As long as a lawyer supervises foreclosure filings, and at least reads them before they’re submitted to the court, that is acceptable. But Loughren is suing because all three named partners of GMM, Joseph Goldbeck, Gary McCafferty and Michael McKeever, have admitted under oath — during depositions last September and in a separate case in December 2009 — that no attorney ever read the filings. The partners made clear that the practice has gone on for the past several years.

Video – Attorney Signatures – The Next Fraud Battle Ground

Posted by Foreclosure Fraud on October 2, 2010 ·

Foreclosure Deposition Clip Witness = Goldbeck, McCafferty & McKeever corporate designee pursuant to Federal Rule of Civil Procedure 30(b)(6) Date = 9/21/10 Individual sitting as the designee = Gary McCafferty Trial Lawyer = Patrick J. Loughren Well well well… The video above is an actual deposition where an attorney just recently admitted to frauds we … Read more

Foreclosure Deposition Clip

More examples from Matt Weidner’s Blog for another perspective…

Attorney Signatures – The Next Fraud Battle Ground

The Florida Rules of Civil Procedures require that all pleadings filed in a case be signed by a licensed Florida attorney.  I have started to examine files and am becoming increasingly suspicious that this important rule is not being followed by the foreclosure mills.

I am therefore starting to examine all my pleadings closely and I encourage each of you to do the same.  Ultimately I would like to build a database of these signatures to compare, so for those of you out there that are spending time looking at court filings, please start examining the signatures and making a cut and past document similar to the one I attach below.

My first example of gross irregularities in the signature of an attorney who makes filings in a court case comes from Ohio.  The document was prepared by a reader of this blog and it comes from an Ohio foreclosure mill attorney.  Please look at the sheet. There really is no commentary necessary regarding whether these were signed by the same person….

Given what we know about the foreclosure mills and their operations (particularly the offshore components of their practice) I cannot imagine that they are following this rule. (I mean the violate every other rule)

Foreclosure Fraud – Attorney Signatures – The Next Battle Ground

You can read more about Matt’s excellent work here…

Next up, Patrick J. Loughren’s Complaint in Equity

Patrick J. Loughren Complaint in Equity

Far-Reaching Consequences

Loughren declined to talk with DailyFinance (nor would he even give us the complaint, which is electronically available from the court), and as of now, GMM hasn’t returned our calls either. (We learned of the case from Walter Roche’s story in the Pittsburgh Tribune-Review.) But Loughren’s complaint is so detailed, and the partners’ admissions so damning, that if this case is decided on the merits, it’s hard to see how Loughren could lose.

If Loughren does win, the consequences could be far-reaching: All current foreclosure actions filed by GMM could be dismissed on the grounds that lawsuits filed by nonlawyers are a “nullity,” meaning they don’t count. That’s hundreds, potentially thousands, of cases across Pennsylvania.

All completed foreclosures that were brought using this method could also be called into question for the same reason, and given that the practice has been going on for years, a Loughren win could throw into question the title to thousands of Pennsylvania properties. In addition, any homeowners who paid legal fees to the banks and GMM during their foreclosures could get that money back.

Bank of America Knew

Loughren notes that in both cases involving the partners’ testimony about the practice, Bank of America (BAC) was the foreclosing bank. It was actually present during the December 2009 trial when the admissions were first made. Loughren points out that BofA’s representative at that trial, John Smith, is himself a lawyer, and so presumably understood the legal significance of GMM’s admission.

Other BofA employees surely learned about the practice too, given that the December case was an effort by the U.S. Bankruptcy Trustee to sanction both the bank and GMM for misconduct, and evidence submitted for it showed the involvement of “high-ranking” BofA people not normally involved in a foreclosure, such as its assistant general counsel.

Although the practice of having nonlawyers file suit wasn’t at issue in that case, learning of it upset U.S. Bankruptcy Court Judge Thomas Agresti so much he wrote in his Oct. 5, 2010 order:

“During the trial the Court also became aware of some apparently routine practices at GMM that raise issues that cannot be ignored. McKeever testified to a procedure at his firm whereby foreclosure complaints are prepared and filed by non-attorneys and never reviewed by an attorney, even though the “signature” of an attorney appears on the document. . . . Even though these actions are not being filed in this Court. . .concern for our sister courts in this Commonwealth compel the Court to at least make publicly known what it learned during the trial. Furthermore, often these fundamentally flawed foreclosure actions, form the basis for related relief in this Court should the state court defendant subsequently file a bankruptcy petition. Therefore, the Court is concerned about the continuation of this practice by GMM.”

Return of “Legal” Fees

In a related Nov. 24, 2010 order, the judge noted that although two of GMM’s clients temporarily suspended working with the law firm, Bank of America did not. Even though the bank learned that GMM’s practices could be jeopardizing many of its foreclosures, the bank continued to work with the firm and pocket related foreclosure fees, at least as of Nov. 24.

Sharon Diane Hill, Roberta A. DeAngelis v Countrywide Sanctions Order

Full article from DailyFinance:

Looks like someone got some splainin to do…


7 Responses to “Foreclosure Fraud Bombshell – Thousands of Pennsylvania Foreclosures Could Be Void”
  1. Gwen Caranchini says:

    Im in Kansas City, Mo and am suing Kozeny & McCubbin L.C., the trustee on my DT who attempted to foreclose in 2008. This is part of a larger piece of litigation against BOA/BAC, Countrywide, MERS, Citi as trustee for MLMI2006-he-5, Todd Hamby, Wilshire and others involving quiet title and declaratory judgment claims, claims for fraud, breach of fiduciary duty, negligence. I’m a former trial attorney for 30 years who got fed up with the run around on my loan mod and after investigation discovered any number of problems, including a title to my property that Chicago title would not insure. K & M recently filed a M/Dismiss after I sued them and it is pending. The first doc that I filed I decided to handdeliver to Patrick Murphy the attorney for K & M who are pro se which I found interesting. I went to their “law office” and wow was I shocked. Not only were they not on the marquee, they were hiding behind the name of a title company. The door to the office had bars on it and a buzzer to gain entrance. A woman answered the door in “less than professional” clothes. The office was like no law office I have ever seen in 30 yaers. Row upon row of cubicles with no offices, no reception area whatsoever. She yelled out for Patrick Murphy who showed up at the door and took my filings. I was shocked. Talk about “foreclosure mill”! The lawsuit in PA gives me some ideas and I am going to file a complaint with the States of Ks and Mo Bar for unlawful practice of law, file complaints with the state attorney generals for investigation and after some discovery which will commence shortly add another claim. One of the things I asked for was the malpractice policy and any complaints against the law firm. They were furious. However,I found it shocking that this firm entered an appearance pro se rather than thru a malpractice carrier or have some law firm represent them. This was suspicious in itself. There is no way that two or three attorneys in this office could oversee 50 or more paralegal’s work. Something is not right and now I have a template to use to go after these folks. I am providing the trial court a copy of these filings.

  2. Lynn says:

    Hello, we have been stabbed in the back by ASE also. They sold our house to sheriff sale three weeks ago. The tension has taken its effect on our relationship! The house is gone and so is everything else. We have no money left to even move out and now they are trying to gets us out anyway they can. They even sent a man out on Thanksgiving Day to winterize the house and to change the locks and we were never even given notice of anything in any way at any time since the sale!!! Other then the retaliator left a note on our door a day before saying that the property was corporate owned and that we should call him right away! I just hate them!!!!!!!!!! Is there anyone out there who can help us? We just do not know what to do!!!!!!!! By the time The Pa State Attorney General get to our case we will be sitting in the street on the couch freezing to death. Can someone assist us in proving that they stole our house? Like I said, I think by the time the Pa State Attorney General will be too late to help us!!! Can you or anyone you know help us or give us some advice. We are getting desperate!!!

  3. jal says:

    The following story needs a few more details so that it could be helpful to other people.

    [b]Judge sanctions attorney, law firm in Monroeville case [/b]
    By Walter F. Roche Jr.
    Tuesday, November 30, 2010

    The chief bankruptcy judge for Western Pennsylvania sanctioned an attorney and her Philadelphia law firm for filing deceptive documents in a foreclosure proceeding and then lying about them in a case against a Monroeville woman.
    Agresti noted the Philadelphia firm lost $400,000 because of the case and Puida’s compensation was reduced considerably. He said a $50,000 penalty likely would not have “significant further deterrent effect.” If he imposed a greater penalty, it would risk putting the law firm out of business, the judge wrote.

    Agresti said he was especially troubled by the fact that Puida and officials from the firm failed to accept full responsibility for their actions, and lied in court about the three re-created letters.

    “The evidence that Puida lied was considerable” Agresti wrote, concluding she did not tell the truth about when she told Hill’s lawyer the letters were fabrications. He noted she was offered the opportunity during a recent hearing to “change her story,” but insisted she told the truth.

    “This was not a shades-of-gray-type situation,” Agresti said.

    In a prior ruling, Agresti declined to impose a financial penalty against Countrywide Mortgage, whose employees generated the letters. He said the mortgage firm should consider his action a public reprimand, however.

    Goldbeck, McCafferty and McKeever handled dozens of foreclosure proceedings in Pittsburgh and across the state.

    The law firm faces a pending civil lawsuit in Allegheny County Common Pleas Court charging it engaged in widespread fraud in mortgage foreclosures by filing documents that licensed attorneys were supposed to review but did not.

    The lawsuit filed by attorney Patrick J. Loughren asks a judge to block foreclosure proceedings filed “by the non-lawyers” at the firm. Lawyers’ signatures routinely were forged on court documents, the lawsuit charges.

    Loughren declined to comment.

    Attached to the lawsuit were more than a half dozen examples of one lawyer’s purported signatures bearing no resemblance to each other, some filed in the same case. The lawsuit charges the forgeries were used to justify unearned attorneys’ fees.

    The lawsuit cites depositions in which partners in the law firm openly acknowledged non-lawyers routinely prepared and filed foreclosure actions that “have never been reviewed by a lawyer.”


  4. TILA and other consumer protection statutes are an important category of available foreclosure defenses. I like to break up almost all foreclosure defenses into 3 broad categories: consumer law violations (TILA, RESPA, etc.), technical defenses (standing, improper securitization, etc.), and estoppel defenses based on banks’ conduct during loan modification negotiations. For more detail, you can read this post:

  5. There doesn't seem to be cost effective recourse for many... says:

    A Happy Ending to a Raw, but Common, Tale

    Yes, there are people who took out mortgages knowing they could never pay the money back. Ms. Roberts is not one of them. Rather, she is one of the many Americans, mostly poor and lower-middle class, who have been devastated by a system that is as rapacious, uncaring — and sloppy — in tossing people out of their homes as it once was in foisting predatory mortgages on them.

    Two days after I spoke with Ms. Roberts, Bank of America and Fannie Mae acknowledged that foreclosing on her home had been a mistake, and they vowed to give her back the house. “We are going to work with her on a loan modification,” a Bank of America spokesman promised.

    What happened over the course of the next few years can only be described as Kafka-esque. Wilshire Credit asked her for a hardship letter; she sent one. Nothing happened. Three separate times, Wilshire set up short-term payment agreements — two of which included $7,000 upfront payments — claiming that it would make a decision on a long-term modification once the agreement expired. She paid every penny — to no avail.

    In March 2010, Bank of America, which got Wilshire when it bought Merrill Lynch in 2008, sold the servicing company to I.B.M. As part of the deal, though, it kept Wilshire’s servicing clients.

    But as I discovered when I began asking around, the story is even worse than that. Why did Fannie Mae begin eviction proceedings? Because Bank of America claimed, wrongly, that Ms. Roberts was a deadbeat who hadn’t made a mortgage payment since March 2008. When Fannie Mae asked the bank to double-check, Bank of America simply repeated this false information. In other words, Ms. Roberts was being thrown out of her house because of Bank of America’s carelessness.
    “It’s offensive that BofA thinks a foreclosure action, an eviction notice of an elderly woman sitting in her house fearing that she will spend the remainder of her days in a shelter, is some sort of party invitation that can be ‘rescinded,’ ” she wrote in an e-mail. “Their disrespect for the law is appalling. But it is a pattern of behavior that led to this crisis and that is continuing to keep this country in this crisis.”

  6. JS says:

    While not directly related, nevertheless an encouraging story in todays Wall Street Journal about a woman who has delayed her foreclosure for 25 years!

    The 25 Year ‘Foreclosure From Hell’

  7. James M says:

    A sampling of signatures is — USELESS unless you know the documents they come from. To be admissible as evidence you MUST obtain certified copes from the clerk of the court where the documents are filed.

    If the signature is from a document in the public records then you need to know COUNTY – BOOK and PAGE number.

    If they are from documents used in court then you need to know CASE NUMBER – DOCUMENT TITLE and preferably the date docketed and county too.

    Samples like the ones above are — USELESS unless you know where to go for the originals.

    NEXT: As to attorney signatures and documents being executed by non-lawyers who squiggle something over the name of an attorney. I see this most commonly on documents from the Florida law firm of Shapiro & Fishman. I have a few classics.

    I also notice they KNOW they have a signature problem, so have taken to having everything, including simple motions executed with TWO name blocks but commonly one shared signature. Commonly one squiggle, one name and bar number typed on the document and a rubber stamp of another name and bar number added two. I don’t believe you can tell which one executed the squiggle on the document. I think this is defensive, so that if one is disbarred they can argue the other signed it…..

    There is absolutly NO reason a court filing from one law firm needs two names and bar numbers, especially when there is only one squiggle or signature. The only time you need more than one signature is when it is a joint motion, a joint stipulation, a contract or agreement, the agreement coming from mediation or similar document where there is more than one party agreeing to the document.

    he most obvious but often overlooked signatures are on notices of filing documents or affidavits, and notices of hearing. These are almost ministerial functions and are most likely to be subbed out to non-lawers. Often the simple notices pass un-noticed when you are looking for the meat and potatoes in the litigation, but when looking for suspect attorney signatures they are a very good place to start.

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