Florida's Foreclosure King Investigated For Questionable Practices
Multimillionaire Attorney David Stern Amassed Fortune Foreclosing on Homes
Oct. 12, 2010— -- A former paralegal with Florida's largest foreclosure law practice has told state investigators that the firm routinely signed court paperwork without reading it, misdated records, forged signatures and passed around notary stamps in the rush to foreclose on homes.
"This is just the beginning really," the paralegal, Tammie Lou Kapusta, told ABCNews.com. "It's the tip of an extreme iceberg."
The allegations are the latest leveled against the firm of multimillionaire attorney David J. Stern, who has amassed a fortune foreclosing on the homes of struggling families on behalf of lenders.
The 50-year-old Stern even considered naming his $20-million yacht "Su Casa Es Mi Casa – "Your House is My House," an acquaintance told the New York Times. After his wife and others reportedly cautioned against it, Stern settled on Misunderstood. He denied to the newspaper that he considered "Su Casa Es Mi Casa."
"From David Stern's perspective, he's a lawyer given defaulted mortgages to foreclose in a court proceeding," said his lawyer, Jeffrey Tew. "So it's really wrong to vilify him. Let's put it this way, there is a well-organized defense bar who is making a lot of money keeping people in their homes."
But it's the booming mortgage-servicing industry that is under legal scrutiny. Some 40 state attorneys general are expected to announce this week a joint investigation into the industry in hopes of pressuring financial institutions to rewrite a sea of troubled loans.
Across the nation, mortgage-servicers, which include units of major banks such as Bank of America Corp., have been accused of submitting fraudulent documents in thousands of foreclosure proceedings.
In Florida, Stern is foreclosure king, operating the large law firm plus a foreclosure processing company and other support businesses that he recently sold off.
His Plantation, Fla., firm, which filed 70,382 foreclosure cases last year, is the largest of three under investigation by state Attorney General Bill McCollum for allegedly filing improper documents with courts to hasten the overloaded foreclosure process.