Recently out of law school and looking for work, scores of young Florida attorneys found steady paychecks in burgeoning firms whose business is based on repossessing the American dream.
Today, more than 260 attorneys work at four of Florida’s largest foreclosure firms, and 48 percent of them have been practicing law for less than three years, according to Florida Bar records obtained by The Palm Beach Post.
Of 156 attorneys who started the year churning out foreclosures at the massive Plantation-based operation of David J. Stern but have since left or been laid off, half had been practicing law for less than four years.
With this fall’s allegations of forged foreclosure documents, fraudulent notarizations and questionable affidavits submitted in tens of thousands of foreclosure cases, those nascent lawyers are now under a cloud of suspicion.
Some may face Florida Bar investigations that could end their careers, while homeowner advocates wonder whether the foreclosure crisis would have reached its state of disorder if it weren’t for legions of novice lawyers doing the legwork.
And as the state’s overwhelmed court system sorts through the foreclosure chaos, many of the attorneys who worked for the now deposed Stern law firm have been hired at other large companies doing foreclosure work.
‘A game of Whac-A-Mole’
The Atlanta-based McCalla Raymer law firm, which handles foreclosures for mortgage giant Fannie Mae in Georgia, hopes to do the same in Florida. In November, as the firm began setting up shop in Orlando with 10 former Stern attorneys, disgruntled homeowners in Georgia filed a federal class-action lawsuit against the firm, claiming it used forged documents to take their homes, often while they were in the midst of modifying their loans. This month four other Georgia homeowners – who are representing themselves – have filed similar lawsuits against McCalla Raymer.
The firm initially registered to do business in Florida as McCalla Raymer Florida LLC but dissolved that firm a month later and is now registered to do business in Florida as Stone, McGehee & Silver. The firm, which hired former Fannie Mae associate general counsel and foreclosure expert Susan Reid last month, has plans to expand throughout Florida, advertising for attorneys in Tampa, Fort Lauderdale, Miami and Orlando. While at Fannie Mae, Reid worked with foreclosure attorneys in its retained attorney network, including those from Stern’s office.
The Fort Lauderdale-based Law Offices of Marshall C. Watson has picked up five former Stern attorneys, while Shapiro & Fishman, with offices in Tampa and Boca Raton, has hired one. Both firms, as well as Stern’s company and the Tampa-based Florida Default Law Group, are under state investigation.
Other lawyers who have left Stern’s company are now earning a living at several Fannie Mae-designated foreclosure firms, such as Ben-Ezra & Katz in Fort Lauderdale and Kahane & Associates in Plantation.
“We did a thorough vetting of the Stern attorneys,” said Marty Stone, a managing partner with McCalla Raymer. “I don’t want to say we weren’t concerned at all, but I do think there is a danger of painting with too broad of a brush.”
Still, the distribution of former Stern attorneys to other firms feels like an injustice to some homeowners in foreclosure.
In sworn statements taken by the state attorney general’s office, two former Stern employees – a paralegal and a legal assistant – attest to wrongdoing at the firm that included hiding problem files from federal auditors, forging signatures and making up documents as staff struggled to keep up with a mounting volume of foreclosures.
“It’s like a game of Whac-A-Mole – these unethical, dangerous attorneys just pop up somewhere else,” said Lisa Epstein, a homeowner advocate in Palm Beach County who runs the website Foreclosure Hamlet. “The Florida Bar has proven that they have no intention of disciplining these unprofessional attorneys.”
Lack of experience could have led young lawyers to follow their employer’s lead, unaware they may be committing an offense, said Matt Weidner, an outspoken St. Petersburg foreclosure defense attorney, who nonetheless believes lawyers share a large portion of blame in the foreclosure fracas.
“The attorneys are the key; they played an essential, critical role in all of this,” Weidner said. “But I know the younger attorneys had no idea what they were doing.”
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