Florida Attorney General Pam Bondi’s office has expanded its investigation of foreclosure law firms beyond false court documents and the so-called “robo-signers” who were producing them in huge volumes.
Spokeswoman Jennifer Davis said, in response to questions from the Sun Sentinel, that the investigation is also focusing on allegations of misconduct by attorneys, in addition to others who worked at the large law firms that formerly handled most of Florida’s foreclosure cases.
Among the allegations she said the attorney general’s office is examining:
Law firms padding bills in order to get higher final judgments for lenders at foreclosure. The allegation is that bills submitted in court documents contained inflated fees for process serving -- the procedure for delivering legal notices to those involved in court cases -- that were higher than what the firms actually paid for this service.
Attorneys submitting blank bills in court documents that didn’t reveal the actual amount of their fees
Lawyers steering business to title companies owned by the principals in their law firms.
Law firms filing foreclosures before the lender or loan servicer shows that it has a legal interest in the mortgage.
Davis did not indicate which firms are facing which allegations. She also said there is no timetable for the investigation to be concluded.
Bondi’s predecessor Bill McCollum launched the investigation last year of four large foreclosure law firms – the law offices of David J. Stern, Shapiro & Fishman, Florida Default Law Group and the law offices of Marshall C. Watson.
Bondi won election last November and took office earlier this month.
Stern’s Plantation-based law firm, which launched a publicly traded company to handle back-office functions for foreclosure cases, has come under additional pressure as its major clients Fannie Mae and Freddie Mac pulled their business. Stern’s business subsequently laid off hundreds of employees.
Attorney Holly Skolnick of the law firm Greenberg Traurig in Miami said her client - the law offices of Marshall C. Watson - is cooperating with the attorney general’s investigation. “We expect to resolve whatever issues [are raised],” she said.
Attorney Gerald Richman, who represents Shaprio & Fishman, pointed out that it is not illegal for a laywer to own a title company. The expansion of the Attorney General’s investigation “ is very much of a fishing expedition.” He said Shaprio & Fishman “has done noting wrong.”
A lawyer for Stern could not be reached for comment, despite several attempts by phone and e-mail. A spokeswoman for Florida Default Law Group did not respond to requests for comment.
Bondi’s spokeswoman said the new attorney general has met with representatives of the Florida Bar to discuss the issues. “General Bondi has made the foreclosure crisis one of her main areas of focus,” Davis said.