David J. Stern | The Rise and Fall of a Foreclosure King

The firm’s fall has spawned more chaos in Florida’s circus-like foreclosure courts. A slew of homes Stern foreclosed on that sold for $240,000 each during the credit bubble sold at auction as orphaned cases for $200. Recently, even the most infamous “rocket docket,” in Lee County, where judges were reported to have signed off on a foreclosure every 30 seconds, ground to a virtual standstill as the Stern firm withdrew from case after case. Some of Stern’s remaining lawyers show up court with greasy hair, fleece jackets and food-stained clothing. As for Stern, if federal and state prosecutors file criminal charges, he could end up in prison.

Meanwhile, Stern’s payment on his $12 million line of credit with Bank of America is late. So is the rent on his headquarters.

He’s now in default.


The Rise and Fall of a Foreclosure King


The Associated Press

FORT LAUDERDALE, Fla. — During the housing crash, it was good to be a foreclosure king. David Stern was Florida’s top foreclosure lawyer, and he lived like an oil sheik. He piled up a collection of trophy properties, glided through town in a fleet of six-figure sports cars and, with his bombshell wife, partied on an ocean cruiser the size of a small hotel.

When homeowners fell behind on their mortgages, the banks flocked to “foreclosure mills” like Stern’s to push foreclosures through the courts on their behalf. To his megabank clients – Bank of America, Goldman Sachs, GMAC, Citibank and Wells Fargo – Stern was the ultimate Repo Man.

At industry gatherings, Stern bragged in his boyish voice of taking mortgages from the “cradle to the grave.” Of the federal government’s disastrous homeowner relief plan, which was supposed to keep people from getting evicted, he quipped: “Fortunately, it’s failing.”

The worse things got for homeowners, the better they got for Stern.

That is, until last fall, when the nation’s foreclosure machine blew apart and Stern’s gilded world came undone. Within a few months, Stern went from being the subject of a gushing magazine profile to being the subject of a Florida investigation, class-action lawsuits and blogger Schadenfreude that, at last long, the “foreclosure king” was dead.

“What Stern represents is an industry that was completely unrestrained, unchecked, unpunished and unsupervised,” says Florida defense attorney Matt Weidner. “This was business gone wild.”

The rise and fall of Stern, now 50, provides an inside look at how the foreclosure industry worked in the last decade – and how it fell apart. It also shows how banks, together with their law firms, built a quick-and-dirty foreclosure machine that was designed to take as many houses as fast as possible.

Not long ago, the world of back-office bank procedures was of little interest to the public. But revelations last fall about robo-signers powering through hundreds of foreclosure affidavits a day, without verifying a single sentence, changed all that. Today the banking industry’s eviction juggernaut is under intense scrutiny as allegations of systemic foreclosure fraud mount.

The 50 state attorneys general are conducting a foreclosure industry probe. So are state and federal regulators. Class-action lawsuits are gathering force, and, with increasing frequency, state judges are tossing out foreclosure suits in favor of homeowners. The developments are prolonging the housing market depression, casting doubt on mortgage ownership and calling into question whether mortgage-backed securities are, in fact, backed by nothing at all.

The Florida attorney general’s economic crimes division is investigating three law firms, including Stern’s, over allegations that they created fraudulent legal documents, gouged homeowners with inflated fees, steered business to companies they owned and filed foreclosures without proving the bank actually had a legal interest in the loan. Florida authorities characterize the foreclosure process at these law firms as a “virtual morass” of “fake documents” and depicted Stern’s operations as something akin to the TV show “Lost” – only instead of people that went missing, it was paperwork. Stern’s employees churned out bogus mortgage assignments, faked signatures, falsified notarizations and foreclosed on people without verifying their identities, the amounts they owed or who owned their loans, according to employee testimony. The attorney general is also looking at whether Stern paid kickbacks to big banks.

“There’s a David Stern in every state, sometimes more than one,” says Jacksonville Legal Aid attorney April Charney, who has successfully stopped foreclosure for hundreds of Florida families.

Stern denied repeated requests for comment. He did not answer inquiries at his office or at his main residence in Fort Lauderdale. Stern’s lawyer, Jeffrey Tew, agreed to an interview in late December at his Miami office, then canceled it the night before without further comment.

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9 Responses to “David J. Stern | The Rise and Fall of a Foreclosure King”
  1. Ali says:

    They should make an exsample out of him and take his $$$$ and his liberty. A nice pair of leg irons…….

  2. Margaret Semenuk says:

    I could give you info that would knock your socks off. My story is different than a mortgage foreclosure. Stern
    is not the only one to blame fore this. The banks were dealing with dishonest closing agents. forged
    forms, notaries, etc. The paperwork was bad before it got to Stern. He and his office only made it worse.


  3. Scott says:

    How ironic that he falls in the very trap that he said he wished to see among homeowners. My wish for you garbageman is that someone like you who molded themselves after you is doing to you as you have done unto others. See you in ….

  4. PJ says:

    PS… the point here is not to get mad. Get smart, get focused and demand due diligence from our taxpayer funded GSE’s.

    Stern apparently was a self indulgent mark , an underling so to speak of a larger predatory beast and that is Gerald Shapiro… people want to focus on all the toys this boy acquired, Stern however he dug his own grave, as braggarts and fools often do. Do not allow the folly that what the MSM writes to appease and satisfy personal angst, we know Stern is bad, but he could only continue on his path with backing. Lets find that backing!

    LOGS network is the place to start, lets not forget that it was a LOGS network law firm , Shapiro & DiCaro, that the good judge in NY smacked down in 2009.

  5. PJ says:

    So when will Stern throw his mentor Gerald Shapiro under the bus!

    “There’s a David Stern in every state, sometimes more than one,” says Jacksonville Legal Aid attorney April Charney, who has successfully stopped foreclosure for hundreds of Florida families.

    Gerald Shapiro and his LOGS network created all of them! Time to indicate Shapiro and all associated within the LOGS Network!

  6. Heather says:

    In my case, Stern withdrew November 30, 2010 at a LOP (Lack of Prosecution) hearing after inactivity for over 14 months by Stern. Court entered order allowing his withdraw. Meanwhile, Greg Dreilinger, Esq. (who did the Motion for Summary Judgment for Stern’s Office) and Adam George, Esq. (who did the Complaint for Stern’s Office) remained on in the case separating the Secutization Trust into Greg representing the Trustee and George representing pieces of paper, the certificates. Interestingly enough, both Greg and Adam are still using Stern’s address in Plantation as the official notice address in the Certificate of Service/Mailing for all pleadings. Seems Stern still wants to be “kept” in the loop on my case. Oh, by the way, both Greg Dreilinger and Adam George has different addresses with the Florida Bar. Makes you wonder who is the attorney in my case representing the “plaintiff.” Well, just another fraud on the court for sure! And, apparently my case is sooo important that Stern now has some 13 different attorneys to prosecute it. That’s okay, we just fired our old attorney, for ineffective counsel, who let our case go on for over 4 years. The allay in the enemy camp. Certainly, a cluster “you know whating!” If that were the only thing wrong in our case that Stern created, I’d say whatever and move on, but its not. Stern has created every single thing that you hear about in all these other cases (including Cherly’s affidavit), with added details of complications, in our case. Again, that’s okay. Somehow we will muddle through it and keep a positive attitude that we will prevail, somehow, and not lose our asses!

    • Paul says:

      So what happens when the order is withdrawn? Does it start over, with another law firm then trying to prosecute you?

      My first go-around with Stern’s firm, in 2007, got thrown out by my circuit Court for lack of any action on their part after 12 months. My current one is still hanging, though, even though they brought it on 12/31/09, and have done nothing since, it still shows as “ACTIVE” in my local county’s website docket.

  7. Marla says:

    May all these slimmy, crap on the bottom of my shoe, inhuman, low life pieces of scum be thrown down to hell for all they have done. Good to see that people who gained so much from the devasation of others are getting what they deserve. Are Sterns attorneys really showing up in court looking like bums? And this Cheryl Samons thing, she seemed to be behind a lot of the illegal crap according to some depos. Is she part of the investigation. Wonder is Stern is still paying her way? Someone should be able to locate her, you would think. May the gates of hell welcome these a$$$$ with open arms.

  8. l vent says:

    Stern is scum and so are the extortionist terrorists who raged this Holocaust on America and the American people and our way of life. They all need to be smoked out of their foxholes and face the American people. We will decide what we think is the right form of punishment for all of them.

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