Banks’ Foreclosure Lawyers Face Few Repercussions

In the wake of Florida’s mortgage and foreclosure crisis, accountability has been sought at many levels.
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Our Miami foreclosure lawyers know that the banks have paid millions in settlement agreements and mortgage servicers have been fined and even criminally charged with filing fraudulent bank documents.

Those punishments were far from sufficient, in our eyes, but at least they were something.

We can’t say the same for the attorneys and law firms who had been working for the banks. Of course, we can’t hold lawyers accountable for the sins of their clients. But the actions of these individuals and firms go beyond that.

In fact, their actions even forced the banks to temporarily halt foreclosures. It’s been well-documented that these attorneys handled hundreds of thousands of foreclosures. They were churning them out with little regard for the individual facts of the case. Even worse, there is ample evidence that documents were falsified with phony signatures, records were improperly backdated and homeowners weren’t given proper notice of the foreclosure filing. The onus here lies squarely with the bank attorneys.

Some critics have accused both the Florida Bar and Florida Attorney General Pam Bondi of failing to act in any decisive manner regrading these wrongdoings.

Bondi said she was unable to proceed because an appellate court ruled an investigative subpoena from her office could not be honored because her office didn’t have the authority to investigate those matters per Florida’s unfair trade practices law. Essentially, she says that meant that any discipline against these lawyers would have to come straight from the state Bar. A proposed bill in this year’s legislature that would have closed this loophole has stalled.

But there are other avenues her office could have pursued, without basing the claim on the unfair trade practices act. For example, prosecutors in her office have the option of going after law firm subsidiaries or even pursuing the matter from a criminal standpoint.

Instead, her office did nothing.

Of the 330 attorneys the Bar has so far investigated, only two have faced disciplinary proceedings.

Given that Florida had the country’s highest foreclosure rate in 2012 – one out of every 32 homes – the lack of action is puzzling.

Since mid-2011, Bondi’s office has received some 200 complaints from homeowners relating to eight foreclosure law firms representing the banks. Of those, nearly half were filed after the appellate court made its ruling on the investigative subpoenas.

In one of those cases, a couple said they began receiving eviction notices from a law firm, even though mortgage records showed they had kept current on their mortgage payments. They weren’t informed that two other companies were hired to have their utilities shut off and put their home on the market. Notices were posted demanding the couple vacate their home.

Eventually, the couple’s lawyer was able to find the root of the mistake, proved that the bank had no standing to file a foreclosure and that the law firm handling the bank’s claim had failed to do any research whatsoever on the property before pressing forward with the case.

All this leaves our Miami foreclosure lawyers left to wonder whether the homeowners we represent are going to be any safer moving forward than they were before this mess began.

So far, the evidence would suggest they are not. In some cases, we still see evidence of bank attorneys failing to properly research whether a homeowner deserves a foreclosure filing. We continue to see cases where homeowners aren’t given any advance notice of the filing. And all too often, we’re seeing cases where the bank is pursuing a foreclosure, even as the homeowner is desperately trying to negotiate a home loan modification agreement.

If you’re battling foreclosure in Miami or the surrounding areas contact Jacobs Keeley for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday from 5 p.m. to 6 p.m. on “Mortgage Wars,” discussing foreclosure topics that matter to YOU.

Additional Resources:
Little discipline for foreclosure lawyers, May 2, 2013, By Mike Schneider and Gary Fineout, Associated Press
More Blog Entries:
Florida Foreclosure Payouts Pale in Comparison to Consultant Checks, May 7, 2013, Miami Foreclosure Lawyer Blog