IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION

WILLIAM C. SQUIRES, et al.,

Plaintiffs,

v.

BAC HOME LOANS SERVICING, LP,

Defendant.

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© 2010-12 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.
www.StopForeclosureFraud.com

Folks, please tweet, forward, whatever. This is a huge story that deserves to be given major coverage in MSM. Local judges need to be aware that they are being handed forged documents.

FDL-

In 2010, the Law Offices of David J. Stern spun off the robo signing document mill part of his business into a separate, publicly traded company.

Stern pocketed some $60 million from that deal. The investors got the company and all its documents, internal procedures and everything you would need in order to find out what really happened within the Stern document mill.

A little after 8 AM EST today, a filing went up on the SEC’s Edgar database. It’s a Complaint in lawsuit, dated yesterday.

[FIRE DOG LAKE]

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© 2010-12 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.
www.StopForeclosureFraud.com

Mortgage Fraud

Law Offices of David J. Stern
ProVest
PTA

Action Date: January 4, 2012
Location: FT. Lauderdale, FL

In the lawsuit filed by DJSP Enterprises against David J. Stern and the Law Offices of David J. Stern, there are also allegations involving ProVest, the process server used by Stern and most of the other major foreclosure mills hired by Lender Processing Services in over 20 states.

The allegations regarding ProVest are found in paragraphs 36-38:

36. Prior to the Transaction, the Seller Defendants also knowingly and systematically inflated their process of service costs to the Court. Specifically, Seller Defendants engineered a fraudulent scheme whereby they directed their process servicing work to a process servicing company called ProVest. The Seller Defendants caused each file to generate four or five separate fees for service of process regardless of whether service of process on multiple defendants was necessary or appropriate and regardless of whether service of process for multiple defendants could be achieved at the same address.

37. In exchange for receiving these inflated service of process fees, ProVest, in turn, routinely referred back to PTA servicing requests for “skip tracing” to locate defendants for whom ProVest purportedly did not have accurate street address information to effect service of process. ProVest “hired” and paid fees to PTA for “skip tracing” services despite the fact that ProVest had the ability and resources to perform “skip tracing” itself and routinely did so itself.

38. The Seller Defendants’ arrangement with ProVest amounted to a kickback scheme. DS Law padded and inflated its process servicing costs which were billed to its clients and added to the court costs assessed to foreclosure defendants. In exchange for feeding this work to ProVest, PTA earned manufactured “skip tracing” fees which inflated PTA’s revenues and profits and which represented another way in which the Seller Defendants artificially inflated the revenues of the Target Business prior to the Transaction.

 

 

© 2010-12 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.
www.StopForeclosureFraud.com

Mortgage Fraud

DJSP Enterprises
Law Offices of David J. Stern

Action Date: January 4, 2012
Location: FT. Lauderdale, FL

DJSP Enterprises, the publicly-traded company that was supposed to make millions for investors from the foreclosure services it provided to The Law Offices of David Stern (“the Stern Firm”), sued David J. Stern and the Law Offices of David Stern.

Stern Law mortgage foreclosure caseload rose from 15,000 in 2006 to 70,400 in 2009.

In 2009, Stern Law handled 20% of all foreclosures in Florida.

Stern Law’s clients included all 10 of the top 10, and 17 of the top 20 mortgage servicers in the U.S. including Fannie, Freddie, Citibank, BOA, Goldman Sachs, GMAC and Wells Fargo.

The non-legal, back room servicers related to foreclosures included REO services: property inspection, valuation, eviction, broker assignment – these were performed by DJSP Enterprises – the sole client was Stern Law.

Here are Paragraphs 29 -35:

29. The Seller Defendants fraudulently induced Plaintiffs DAL and DJSP into entering into the Transaction by fraudulently and artificially inflating the Target Business’ actual revenues, by intentionally failing to disclose that the Target Business and DS Law were not, in fact, operating in accordance with all applicable laws, and by concealing that DS Law was in jeopardy of losing its largest clients due to DS Law’s unlawful conduct. Indeed, before entering into the Transaction, the Seller Defendants knew that DS Law and the Target Business had been systematically falsifying and/or back-dating pertinent legal documents, submitting such documents to the courts, routinely misplacing and losing original key documents, filing foreclosures with inaccurate and/or incomplete documents, prosecuting foreclosure cases without obtaining proper service of process, and were in jeopardy of losing the Seller Defendants’ largest foreclosure clients due to such conduct.

30. By cutting corners in the foreclosure process without following the rule of law, the Defendants artificially reduced the expenses of the Target Business which falsely inflated the profitability of the Target Business.

31. To summarize, the Seller Defendants failed to disclose to DJSP and DAL that DS Law and the Target Business were systematically operating in an unlawful manner. In addition, the Seller Defendants failed to disclose to DJSP and DAL that the Target Business’ reported revenues were not accurate, inflated, and improperly calculated and that the expenses of the business were also distorted due to the systematic practices designed to “shorten” the legal process. The Seller Defendants falsely led DAL and DJSP to believe that they were acquiring a long-term profitable business that operated in accordance with all applicable laws to induce DAL and DJSP to enter into the Transaction.

33. Prior to the Transaction, the Seller Defendants were at all times well aware that DS Law and the Target Business were intentionally perpetuating a fraud on the courts by, inter alia, systematically filing forged documents, forging signatures on such documents, fraudulently backdating documents, improperly notarizing and witnessing documents, fabricating documents, signing affidavits without reviewing or verifying the information contained therein, prosecuting foreclosure cases without obtaining proper service of process, and filing foreclosures with inaccurate and/or incomplete documents.

34. Indeed, the Seller Defendants directed employees of DS Law and the Target Business to purposefully overlook glaring inaccuracies in foreclosure pleadings and to essentially rubber stamp computer generated documents without reviewing or verifying the accuracy of the documents. New attorneys at DS Law were not only encouraged, but were even ordered to sign legal filings and pleadings without reading them. As a result, false and inaccurate documents were routinely executed and filed with the courts in an effort to hasten foreclosure proceedings and illegally obtain final judgments of foreclosure for the Seller Defendants’ clients.

35. The Seller Defendants even incentivized these unscrupulous and unlawful practices by giving their employees bonuses and extravagant gifts for churning out the highest number of foreclosure cases in the least amount of time. The Seller Defendants encouraged contests between DS Law attorneys to see who could jam a foreclosure case through the courts the fastest.

© 2010-12 FORECLOSURE FRAUD | by DinSFLA. All rights reserved.
www.StopForeclosureFraud.com