Fraud Digest | Mortgage Fraud – GMAC Mortgage, LLC and The Law Offices of David J. Stern


Mortgage Fraud

GMAC Mortgage, LLC
Law Offices of David J. Stern

Action Date: August 12, 2011
Location: FT. Lauderdale, FL

GMAC Mortgage, LLC filed counterclaims in a federal court lawsuit brought against GMAC by its former lawyers, The Law Offices of David J. Stern, P.A. (“Stern”). The case, No. 11-CV-61526, was filed in federal court in the Southern District of Florida, where Stern’s offices were located.

GMAC accuses Stern of gross legal malpractice, breach of contract, breach of fiduciary duty, violating Florida’s Deceptive and Unfair Trade Practice Act and Misrepresentation/Suppression. GMAC seeks unspecified compensatory and punitive damages.

GMAC alleges that Stern:

1. caused or permitted Stern employees to execute, witness and/or notarize assignments of mortgage that were back-dated;

2. caused or permitted Stern’s employees to witness and/or notarize assignments of mortgages, affidavits of indebtedness and/or other affidavits on a daily basis prior to and without actually witnessing execution of the document by the person whose signature was to be witnessed and/or notarized;

3. caused or permitted Stern’s employees to prepare and execute affidavits of indebtedness for submission to the foreclosure court that failed to follow appropriate professional practices and procedures;

4. caused or permitted Stern’s employees to sign the name of another person on various foreclosure-related documents without any indication of that fact on the documents;

5. charged GMAC substantial fees and costs for legal services that Stern knew or should have known fell below the minimum standard of professional care owed by Stern to GMAC; and

6. committed acts or omissions that have subjected GMAC to claims, losses and liabilities of third-parties.

Essentially, GMAC claims that Stern’s malpractice carrier should be held responsible for all of the allegedly fraudulent acts of Stern’s office manager, Cheryl Samons, and other Stern employees who signed mortgage assignments and affidavits to push through foreclosures at record-breaking speed.

On July 27, 2011, Stern filed its Answer to these GMAC claims including the following:

“ 9. GMACM’s claims are barred, in whole or in part, by the doctrine of unclean hands because of GMACM’s: breach of contract; failure to retain replacement counsel in a timely manner; signing inaccurate affidavits; affidavits that were not properly notarized; not confirming whether loan and mortgage documents were properly endorsed; assigned or in possession of the appropriate party; and other misconduct identified in the Consent Order entered on April 13, 2011 by Order of the Board of Governors of the Federal Reserve System and the FDIC, and because, to the extent DJSPA committed legal malpractice, which is expressly denied, any such malpractice was the result of GMACM’s own actions and/or instructions.”

Homeowners and investors are lost in this battle of the giants. Tens of thousands of Florida homeowners lost their foreclosure cases because of the fraudulent documents produced by GMAC.

These documents most certainly came from Stern, but they also came from GMAC’s own employees, including master-signer Jeffrey Stephan, and employees in many other major foreclosure mills used by GMAC. The Stern defense that “Everybody was doing it” is unfortunately true.

An important question for homeowners and investors is whether GMAC has instructed its new lawyers to advise the Courts and homeowners of these findings.

Malpractice insurance carriers throughout the country could not imagine a more ominous case.


11 Responses to “Fraud Digest | Mortgage Fraud – GMAC Mortgage, LLC and The Law Offices of David J. Stern”
  1. Michelle says:

    If anyone out there who may know of Attorneys or Lawfirms (Ca.) That take cases of (ex-homeowners) who’ve already lost their homes to fraudclosure? Please let me know, I’d greatly appreciate it. I fought GMAC and their Attorney for a year and a half, every attorney I called at that time (2007-2009) acted as if I just wanted free rent??? That was never the case, but now that everyone knows that we (the homeowners) where telling the truth and the lenders really we’re committing fraud I want what was taken from me! Maybe not my home as I’m sure someone lives there. I want my credit back! My life back!

  2. Readdocs says:

    If you notify those concerned about the back dating, they know what you’re talking about,
    and what is their rights.

  3. Super Pissed Off! says:

    My home was illegally foreclosed on. Now I hear there is something I can do to get some funds back. But what? Most of the local attorneys only want Foreclosures and they want thousands of dollars up front. I just want to go after the respa and TILA Violations. But not sure how? Any one have success with this?

    The home has been sold and owned by some people who really have made it a showcase. So I am not interested in getting the property back or clouding the title. But I do want to be compensated for being illegally forefclosed on.

    There has to be help out there for people like me. I am sure there are thousands of us who have gone back and looked at the paperwork just to realize that our house was stolen!

    • Super Pissed Off! says:

      One more thing, it was Chase Bank with Marshall C Watsons Law Offices who foreclosed. They were a David J Sterns foreclosure Mill. They Robo Signed and back dated documents, one of the Notary’s even had her right to Notarize revoked. Never produced any documentation and did the assignment of mortgage after my home had been sold!! They even changed a lock on the home while I was still living there!

      Those bastards!

  4. Michelle says:

    I lost my home to GMAC. They are awful! My child still refers to them as ‘ the bad people who stole our house ‘…
    I hope they get what they deserve! For what they put us through and all the other homeowners that suffered too.
    Makes me sick!

  5. GMAC sounds like Captain Renault in Casablanca–“I’m shocked to find gambling in this establishment.” Your winnings, sir. Without generating any sympathy for Stern’s crooked operation, their clients have some very large cojones to take such offense to Stern’s practices. I guess nobody should be surprised.

    • lvent says:

      charles c, It does not happen often but when I want to break up the monotany and look at this giant Ponzi Scheme scandal in a humorous way I like to compare this whole thing to Austin Powers..We have Dr. Evil (the black pope) behind the scenes but really in plain sight trying everything to destroy the world with the help of his evil cohorts and minions like minnie me (the white pope) and number 2 who is the CIA and the FBI. than we have fat bastard who is Wall Street and the banksters..Frau is the U.S. GOV….Austin Powers is Elliot Spitzer..LOL….

  6. lizinsarasota says:

    I’m sure there’ll be a settlement of some sort, out of the public eye, since neither of these companies really wanted to wash their (very) dirty linen in plain view.
    FYI, GMAC, I just looked at Stern Assignments in the 12th Judicial Circuit, last part of 2009, and – you’ll love this! – 100% were backdated. Yes siree, 100%
    I really think I ought to call the homeowners – assuming they’re still in their homes… – and let them know, don’t you?!!

    • lvent says:

      liz, Bloomberg reported today that CEO of BOFA, Brian Moynihan is pressuring Geithner for a foreclosure deal…They are going to try to get away with what they can that is why this is called Foreclosuregate…We can’t allow it…WE THE PEOPLE…. have to bust down that Foreclosure- gate……

  7. JamesM says:

    The same could be said for many other foreclosure mills and their partners/sub-contractors like LPS and Provest.

  8. eif says:

    Thank you for the post, and specifically for this insight:

    “Homeowners and investors are lost in this battle of the giants.”

    We’ve been saying that here for some time, perhaps not as eloquently; but some here do not seem lost, so thanks to the lead post-people. Will watch for more.

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