It is alleged that the firms, which were hired by loan servicers to begin foreclosure proceedings when homeowners were behind on their mortgages, may have fabricated mortgage assignments in order to speed up the foreclosure process.
“Thousands of final judgments of foreclosure against Florida homeowners may have been the result of the allegedly improper actions of the law firms under investigation,” said McCollum, who is running for governor.
“We are seeing a paperwork trail where law firms, through a mill, prepared paperwork with signatures from lenders who had assigned the mortgage,” he said.
All they have to do is look into several blogs and attorney sites to see the evidence of fraud including this one.
________________________________________
Here is Stern’s subpoena below…
Excerpts:
YOU ARE HEREBY COMMANDED to produce at said time and place all documents, as defined above, relating to the following subjects:
1. A list of all employees, independent contractors and/or subcontractors of the Law Offices of David J. Stern (DJS) for the past 5 years (former and current employees, independent contractors and/or subcontractors) including their job title(s), their duties and responsibilities and the length of their employment with DJS, including any contracts DJS has or had with them.
2. For the past five years, the names and addresses of any and all lawyers and/or law firms that DJS hires/uses throughout the State to represent their clients in foreclosure cases and in what capacity said lawyers/law firms serve DJS, including any contracts between DJS and the lawyer(s) and/or law firm(s).
3. The names and addresses of the lending institutions that DJS has represented in foreclosure cases over the past 5 years, including any contracts between DJS and said institutions.
4. The names and addresses of any and all companies used by DJS to draft and/or execute Assignments of Mortgage or Affidavits for the past 5 years, including any contracts between the lending institutions and DJS allowing for the use of the companies to draft and/or execute said Assignments of Mortgage.
5. The names and addresses of any and all persons and/or companies hired and/or used by DJS to perfect service of process on foreclosure defendants for the past 5 years, including their relationship to DJS and/or David J. Stern, individually including any and all contracts between the person or persons and/or company and DJS.
6. The names and addresses of any and all servicing companies DJS represents or represented for the past 5 years.
7. For the past 5 years, the names and addresses of any corporations, companies, partnerships or associations that David J. Stern and/or DJS has any interest in, including any foreign corporations, and detail what the business does and what type of interest is held by Stern and/or DJS.
9. List all notaries for the past 5 years that worked or works for DJS who notarized Affidavits as to fee and Assignments of Mortgage, include their names and addresses.
10. Copies of all non-disclosure agreements that DJS has or had over the past 5 years with any and all of its employees, subcontractor or independent contractors.
11. Copies of all checks and/or evidence of any other form of payment(s) from the plaintiffs that DJS represents in court in foreclosure cases to DJS and/or any of DJS’s affiliates and/or subsidiaries for services rendered in foreclosure cases.
12. Documents, including emails, that evidence what the pay scales, pay grades and/or bonuses paid by DJS to employees, subcontractors or independent contractors for completion of foreclosure cases within a certain time period.
13. Documents, including emails, that evidence what the pay scales, pay grades and/or bonuses paid by lenders to DJS or its employees, subcontractors or independent contractors for completion of foreclosure cases within a certain time period
Financial giants have figured out yet another way to profit from fraud. After devastating communities across the country with shady subprime loans, the mortgage industry has launched a new assault on America’s neighborhoods. Big banks are now outsourcing their foreclosure processing to shady law firms with a history of breaking the law for a quick buck. These foreclosure scammers forge documents, backdate signatures, slap families with thousands of dollars in illegal fees and even foreclosure on borrowers who haven’t missed a payment.
Andy Kroll lays out the insanity in a terrific piece for Mother Jones. “Foreclosure mills,” as they are known, have been around for years, but they’ve become a much bigger problem as the mortgage crisis has deepened. Fannie Mae and Freddie Mac spurred the creation of these social beasts decades ago to help them process large volumes of foreclosures quickly and cheaply. Pretty soon big banks wanted in on the action, and bailout barons at Wells Fargo, Citigroup and Bank of America starting sending foreclosures to these scummy law firms by the thousands.
Banks opt to outsource dirty work like this for a reason. It takes weeks to process the legal work necessary to kick somebody out of their home, since cops and judges don’t want to give borrowers the boot without proof. If you can cut down that processing time, you can save a lot of money on legal bills. Foreclosure mills cut costs for banks by cutting corners—when they can’t compile the documentation needed to push families out of their homes right now, they simply fabricate the documents. Still worse, these guys illegally withhold documentation from borrowers seeking to negotiate loan modifications with their banks—effectively forcing borrowers out of their homes instead of allowing them to cut a deal with the bank. When borrowers actually do straighten things out with foreclosure mills, the scumbags slap them with huge illegal fees. Kroll details a foreclosure mill that erroneously tried to evict a Florida couple who had been paying their mortgage on time. When it became clear that the couple could not be kicked out of their home, the foreclosure mill tried to charge them $18,500 in fees for mistakes committed by the foreclosure mill and the bank. The foreclosure mill even invented two new people who it said lived in the home in order to demand four sets of legal processing fees instead of two.
If nobody holds you accountable, then lying, cheating and stealing are very profitable business models. That’s one reason why banks love sending this kind of work to foreclosure mills. While the foreclosure mills and their lawyers have been bombarded with lawsuits for their trickery, the banks are not directly involved in the funny business. So Citi, BofA, Fannie and Freddie get to cut their costs with shady practices, but they don’t have to shoulder the legal liability for them, even though they must surely know what goes on (if they don’t know, they’re being astonishingly negligent, and should be held responsible).
The foreclosure mill scandal is very similar to a game the banks played in the craziest days of the housing bubble. A few years back, banks outsourced much of the work that goes into issuing mortgages to third-party mortgage brokers. Banks knew that many of these brokers were up to no good, and routinely trained brokers how to steer borrowers into unaffordable subprime loans. Banks also lobbied regulators aggressively for the right to look the other way when brokers abused borrowers or committed fraud. For a few years, banks made big bucks as mortgage brokers turned out fraudulent loans by the truckload. When those loans started defaulting, the banks pleaded innocence and blamed the brokers for the social and economic fallout.
A good piece at Mother Jones, “Fannie and Freddie’s Foreclosure Barons” (hat tip Foghorn Leghorn) provides a window on a seamy big business: cut rate foreclosure processing machines that routinely ride roughshod over borrowers and the law.
Unfortunately, space limitations prevent the story from going deeply into some critical issues. The piece does a good job of explaining how these cut rate legal services operations are creations of Fannie and Freddie and illustrating how they are engaging in fabricating documents. The story focuses on a specific bad actor, a law firm founded by David Stern that handles roughly 1/5 of the foreclosures in Florida:
Ariane Ice sat poring over records on the website of Florida’s Palm Beach County…She and her husband, Tom, an attorney, ran a boutique foreclosure defense firm called Ice Legal…. Ice had a strong hunch that Stern’s operation was up to something, and that night she found her smoking gun.
It involved something called an “assignment of mortgage,” the document that certifies who owns the property and is thus entitled to foreclose on it….By law, a firm must execute (complete, sign, and notarize) an assignment before attempting to seize somebody’s home.
A Florida notary’s stamp is valid for four years, and its expiration date is visible on the imprint. But here in front of Ice were dozens of assignments notarized with stamps that hadn’t even existed until months—in some cases nearly a year—after the foreclosures were filed. Which meant Stern’s people were foreclosing first and doing their legal paperwork later. In effect, it also meant they were lying to the court—an act that could get a lawyer disbarred or even prosecuted. “There’s no question that it’s pervasive,” says Tom Ice of the backdated documents—nearly two dozen of which were verified by Mother Jones. “We’ve found tons of them.”
This all might seem like a legal technicality, but it’s not. The faster a foreclosure moves, the more difficult it is for a homeowner to fight it—even if the case was filed in error. In March, upon discovering that Stern’s firm had fudged an assignment of mortgage in another case, a judge in central Florida’s Pasco County dismissed the case with prejudice—an unusually harsh ruling that means it can never again be refiled. “The execution date and notarial date,” she wrote in a blunt ruling, “were fraudulently backdated, in a purposeful, intentional effort to mislead the defendant and this court.”…
But the Ices had uncovered what looked like a pattern, so Tom booked a deposition with Stern’s top deputy, Cheryl Samons, and confronted her with the backdated documents—including two from cases her firm had filed against Ice Legal’s clients. Samons, whose counsel was present, insisted that the filings were just a mistake. She refused to elaborate, so the Ices moved to depose the notaries and other Stern employees whose names were on the evidence. On the eve of those depositions, however, the firm dropped foreclosure proceedings against the Ices’ clients.
It was a bittersweet victory: The Ices had won their cases, but Stern’s practices remained under wraps. “This was done to cover up fraud,” Tom fumes. “It was done precisely so they could try to hit a reset button and keep us from getting the real goods.”
Backdated documents, according to a chorus of foreclosure experts, are typical of the sort of shenanigans practiced by a breed of law firms known as “foreclosure mills.” ….The mills think “they can just change things and make it up to get to the end result they want, because there’s no one holding them accountable,” says Prentiss Cox, a foreclosure expert at the University of Minnesota Law School. “We’ve got these people with incentives to go ahead with foreclosures and flood the real estate market.”
Yves here. This is far from the only form of document forgeries. A widespread abuse is what bankruptcy attorney Max Gardner calls the “alphabet problem.”
Mortgage securitizations were very carefully designed to satisfy a number of concerns. One of them was bankruptcy remoteness, that if an originator failed, as Countrywide, New Century, IndyMac and a host of others did, that the creditors in the bankruptcy would not be able to claw mortgages back out of securitizations (assets sold close to the date of a bankruptcy may be deemed to have been conveyed fraudulently, and thus can be seized by the court on behalf of the creditors).
To prevent this from occurring, the Pooling and Servicing Agreement (the master document that governs the securitization) would provided for a minimum of two independent legal entities to sit between the originator and the trust that would hold the mortgages being securitized (technically, the note, which is the IOU; the mortgage, which is a lien, follows the note in 45 states). So the prescribed minimum number of steps was A (originator) => B => C => D (trust). Some securitizations (for reasons unrelated to establishing bankruptcy remoteness) would provide for even more steps.
Keep in mind that the PSA also required that the notes be conveyed to the trust, with the proper chain of endorsements, by closing; certain exceptions and fixes were permitted up to 90 days after closing, but these would be applicable only to a very small proportion of the pool.
Howard S. Burnston has accepted the position of Vice President, General Counsel and Corporate Secretary effective August 5th 2010. Prior to joining the company, Mr. Burnston was a shareholder with Gunster, Yoakley, & Stewart, P.A., a Florida law firm, where he practiced for 12 years, most recently as chairman of the firm’s Securities and Corporate Governance Practice Group.
“We are very pleased to add such a seasoned professional to our executive team,” said David J. Stern, Chairman and CEO of DJSP Enterprises. “Howard’s business experience and legal expertise in the areas of securities and corporate governance will add tremendous value to DJSP and our shareholders.”
Mr. Burnston stated, “The company is operating in a dynamic and challenging business environment. I believe the company has a promising future and I am excited to join the impressive management team assembled at DJSP.”
Again, when is this all going to be disclosed to both investors and defendants? Where does one put a stop to conflict of interest? Where are the disclosures?
I am 100% certain that both The State of Florida and DJSP Investors want to know did Mr. Burnston and Mrs. Sasser have a working relationship and to what extent?
How the federal housing agencies—and some of the biggest bailed-out banks—are helping shady lawyers make millions by pushing families out of their homes.
LATE ONE NIGHT IN February 2009, Ariane Ice sat poring over records on the website of Florida’s Palm Beach County. She’d been at it for weeks, forsaking sleep to sift through thousands of legal documents. She and her husband, Tom, an attorney, ran a boutique foreclosure defense firm called Ice Legal. (Slogan: “Your home is your castle. Defend it.”) Now they were up against one of Florida’s biggest foreclosure law firms: Founded by multimillionaire attorney David J. Stern, it controlled one-fifth of the state’s booming market in foreclosure-related services. Ice had a strong hunch that Stern’s operation was up to something, and that night she found her smoking gun.
It involved something called an “assignment of mortgage,” the document that certifies who owns the property and is thus entitled to foreclose on it. Especially these days, the assignment is key evidence in a foreclosure case: With so many loans having been bought, sold, securitized, and traded, establishing who owns the mortgage is hardly a trivial matter. It frequently requires months of sleuthing in order to untangle the web of banks, brokers, and investors, among others. By law, a firm must execute (complete, sign, and notarize) an assignment before attempting to seize somebody’s home.
A Florida notary’s stamp is valid for four years, and its expiration date is visible on the imprint. But here in front of Ice were dozens of assignments notarized with stamps that hadn’t even existed until months—in some cases nearly a year—after the foreclosures were filed. Which meant Stern’s people were foreclosing first and doing their legal paperwork later. In effect, it also meant they were lying to the court—an act that could get a lawyer disbarred or even prosecuted. “There’s no question that it’s pervasive,” says Tom Ice of the backdated documents—nearly two dozen of which were verified by Mother Jones. “We’ve found tons of them.”
This all might seem like a legal technicality, but it’s not. The faster a foreclosure moves, the more difficult it is for a homeowner to fight it—even if the case was filed in error. In March, upon discovering that Stern’s firm had fudged an assignment of mortgage in another case, a judge in central Florida’s Pasco County dismissed the case with prejudice—an unusually harsh ruling that means it can never again be refiled. “The execution date and notarial date,” she wrote in a blunt ruling, “were fraudulently backdated, in a purposeful, intentional effort to mislead the defendant and this court.”
Stern has made a fortune foreclosing on homeowners. He owns a $15 million mansion, four Ferraris, and a 130-foot yacht.
More often than not in uncontested cases, missing or problematic documents simply go overlooked. In Florida, where foreclosure cases must go before a judge (some states handle them as a bureaucratic matter), dwindling budgets and soaring caseloads have overwhelmed local courts. Last year, the foreclosure dockets of Lee County in southwest Florida became so clogged that the court initiated rapid-fire hearings lasting less than 20 seconds per case—”the rocket docket,” attorneys called it. In Broward County, the epicenter of America’s housing bust, the courthouse recently began holding foreclosure hearings in a hallway, a scene that local attorneys call the “new Broward Zoo.” “The judges are so swamped with this stuff that they just don’t pay attention,” says Margery Golant, a veteran Florida foreclosure defense lawyer. “They just rubber-stamp them.”
But the Ices had uncovered what looked like a pattern, so Tom booked a deposition with Stern’s top deputy, Cheryl Samons, and confronted her with the backdated documents—including two from cases her firm had filed against Ice Legal’s clients. Samons, whose counsel was present, insisted that the filings were just a mistake. She refused to elaborate, so the Ices moved to depose the notaries and other Stern employees whose names were on the evidence. On the eve of those depositions, however, the firm dropped foreclosure proceedings against the Ices’ clients.
It was a bittersweet victory: The Ices had won their cases, but Stern’s practices remained under wraps. “This was done to cover up fraud,” Tom fumes. “It was done precisely so they could try to hit a reset button and keep us from getting the real goods.”
Backdated documents, according to a chorus of foreclosure experts, are typical of the sort of shenanigans practiced by a breed of law firms known as “foreclosure mills.” While far less scrutinized than subprime lenders or Wall Street banks, these firms undermine efforts by government and the mortgage industry to put struggling homeowners back on track at a time of record foreclosures. (There were 2.8 million foreclosures in 2009, and 3.8 million are projected for this year.) The mills think “they can just change things and make it up to get to the end result they want, because there’s no one holding them accountable,” says Prentiss Cox, a foreclosure expert at the University of Minnesota Law School. “We’ve got these people with incentives to go ahead with foreclosures and flood the real estate market.”
Stern’s is hardly the only outfit to attract criticism, but his story is a useful window into the multibillion-dollar “default services” industry, which includes both law firms like Stern’s and contract companies that handle paper-pushing tasks for other big foreclosure lawyers. Over the past decade and a half, Stern has built up one of the industry’s most powerful operations—a global machine with offices in Florida, Kentucky, Puerto Rico, and the Philippines—squeezing profits from every step in the foreclosure process. Among his loyal clients, who’ve sent him hundreds of thousands of cases, are some of the nation’s biggest (and, thanks to American taxpayers, most handsomely bailed out) banks—including Wells Fargo, Bank of America, and Citigroup. “A lot of these mills are doing the same kinds of things,” says Linda Fisher, a professor and mortgage-fraud expert at Seton Hall University’s law school. But, she added, “I’ve heard some pretty bad stories about Stern from people in Florida.”
While the mortgage fiasco has so far cost American homeowners an estimated $7 trillion in lost equity, it has made Stern (no relation to NBA commissioner David J. Stern) fabulously rich. His $15 million, 16,000-square-foot mansion occupies a corner lot in a private island community on the Atlantic Intracoastal Waterway. It is featured on a water-taxi tour of the area’s grandest estates, along with the abodes of Jay Leno and billionaire Blockbuster founder Wayne Huizenga, as well as the former residence of Desi Arnaz and Lucille Ball. (Last year, Stern snapped up his next-door neighbor’s property for $8 million and tore down the house to make way for a tennis court.) Docked outside is Misunderstood, Stern’s 130-foot, jet-propelled Mangusta yacht—a $20 million-plus replacement for his previous 108-foot Mangusta. He also owns four Ferraris, four Porsches, two Mercedes-Benzes, and a Bugatti—a high-end Italian brand with models costing north of $1 million a pop.
Despite his immense wealth and ability to affect the lives of ordinary people, Stern operates out of the public eye. His law firm has no website, he is rarely mentioned in the mainstream business press, and neither he nor several of his top employees responded to repeated interview requests for this story. Stern’s personal attorney, Jeffrey Tew, also declined to comment. But scores of interviews and thousands of pages of legal and financial filings, internal emails, and other documents obtained by Mother Jones provided insight into his operation. So did eight of Stern’s former employees—attorneys, paralegals, and other staffers who agreed to talk on condition of anonymity. (Most still work in related fields and fear that speaking publicly about their ex-boss could harm their careers.)
Andy Kroll is a reporter at Mother Jones. For more of his stories, click here. Email him with tips and insights at akroll (at) motherjones (dot) com. Follow him on Twitter here.
By Kimberly Miller
Palm Beach Post Staff Writer
Posted: 5:54 p.m. Tuesday, Aug. 3, 2010
Florida’s purported largest foreclosure law firm filed thousands of documents to take people’s homes that contained deceptive and intentionally ambiguous information, according to a proposed class action lawsuit.
The suit, filed last month in U.S. District Court, Southern District of Florida, says David J. Stern and his Plantation-based legal team violated the Racketeer Influenced and Corrupt Organizations Act by generating fraudulent mortgage assignments when pursuing foreclosures.
An assignment is held by the entity that has the right to receive mortgage payments.
Stern’s practice, which the lawsuit claims filed up to 7,000 new foreclosure cases in Florida every month last year, is also alleged to have pursued foreclosures for lenders that didn’t own the debt on the homes.
“There really is no proper plaintiff to sue and foreclose and that’s what this charade is designed to cover,” said Fort Lauderdale Attorney Kenneth Eric Trent, who is seeking class action status and filed the suit on behalf of Oakland Park resident Ignacio Damian Figueroa. “There is no real holder of the note and the mortgage anymore because they broke it up and sold it to 10, 12, 20 people.”
Chain-of-title is not just an issue for the buyers and sellers of particular homes and title insurance companies. Some entity – and most likely several entities – are claiming these mortgages and loans
as assets when regulators and investors are determining solvency and compliance, but disavowing these same “assets” when acknowledgement of ownership would result in responsibilities ranging from payment of taxes to lawn mowing.
Stern employees often sign as if a bankrupt or out-of-business company or a failed bank owned the mortgage and loan up until foreclosure is imminent. In county recorders’ offices across the state, the Stern-created records show that the trusts acquired mortgages and loans on dates when no such acquisitions ever took place. The trusts claim ownership solely to prove that they have the right to foreclose. The date selected is arbitrary – chosen by Stern or LPS or the mortgage servicing company. In reality, residential mortgage-backed trusts did not rush to acquire billions of dollars in sub-prime non-performing loans in 2008 and 2009 as these assignments falsely state.
The Briscoe Law Firm, PLLC and Cash Powers Taylor, LLP Announce the Investigation of Possible Breaches of Fiduciary Duties Against the Officers and Directors of DJSP Enterprises, Inc.
DALLAS, Jul 28, 2010 (BUSINESS WIRE) — The Briscoe Law Firm, PLLC, founded by a former state prosecutor and enforcement attorney for the United States Securities and Exchange Commission, and the law firm of Cash Powers Taylor, LLP are investigating potential legal claims available to purchasers of DJSP Enterprises, Inc. (“DJSP” or “Company”) (DJSP3.95, +0.07, +1.85%) during the period of March 16, 2010 and May 27, 2010.
DJSP and certain of its officers and directors allegedly violated the Securities Exchange Act of 1934 by issuing materially false and misleading statements and failing to disclose certain facts known to them regarding the Company’s business and financial results. Specifically, on March 11, 2010, the Company issued statements assuring investors that it would continue to profit and earn revenue as usual, despite the Obama Administration’s efforts to curb real estate foreclosures. Additionally, the Company stated that DJSP would continue to be profitable in subsequent years and that its business would not be affected by the government’s involvement in the mortgage markets. However, in April 2010, when the Company’s largest clients began real estate foreclosure conversion systems, DJSP revenue from mortgage foreclosure began to substantially decline. As a result of defendants’ false statements, DJSP’s stock traded at artificially inflated prices during the Class Period.
If you currently own or purchased DJSP shares and would like additional information regarding this investigation or if you have information regarding the allegations against the company, please contact Patrick Powers at Cash Powers Taylor, LLP, toll free (877) 728-9607, via e-mail at patrick@cptlawfirm.com, or The Briscoe Law Firm, PLLC toll free (877) 397-5991, or via email at WBriscoe@TheBriscoeLawFirm.com. There is no cost or fee to you.
The Briscoe Law Firm is a full service business litigation, commercial transaction, and public advocacy firm with more than 20 years of experience in complex litigation and transactional matters.
Cash Powers Taylor, LLP is a boutique litigation law firm that handles a variety of complex business litigation matters, including claims of investor and stockholder fraud, shareholder oppression, shareholder derivative suits, and security class actions.
SOURCE: Cash Powers Taylor, LLP
The Briscoe Law Firm, PLLC
Willie C. Briscoe, 214-706-9314
214-706-9315 Facsimile
WBriscoe@TheBriscoeLawFirm.com
or
Cash Powers Taylor, LLP
Patrick W. Powers, 214-239-8900
214-265-9514 Facsimile
Patrick@cptlawfirm.com
Mr. Trent totally “gets it” and in this complaint he outlines and points out what we all have a hard time piecing together.
Here are excerpts of the complaint:
Beginning in or about 1999, the Defendant Firm joined with Defendant Merscorp, Inc., and other conspirators in the fraudulent scheme and RICO enterprise herein complained of. The employees of the Defendant Firm, including many licensed attorneys, have become skilled in using the artifice of MERS to sabotage the judicial process to the detriment of borrowers, and, over the past several years, have routinely relied upon MERS to do just that.
As Stern boasted to a room of investors at a recent promotional event, recent “direct source initiatives” by the larger lenders increasingly enable the Defendant Firm, DJSP, and other entities recently formed by Stern to take mortgages “from cradle to the grave.”
The whole purpose of MERS is to allow “servicers” to pretend as if they are someone else: the “owners” of the mortgage, or the real parties in interest. In fact they are not. The standard MERS/Stern complaint contains a lie about this very subject. While the title of the standard complaint makes reference to “lost loan documents,” in the body of the standard complaint, the Defendant Firm alleges that the plaintiff is the “owner and holder” of the note and mortgage. Both cannot be true unless the words used are given new meanings.
With the oversight of Defendant Merscorp and its unknown principals, the MERS artifice and enterprise evolved into an “ultra-fictitious” entity, which can also be understood as a “meta-corporation.” To perpetuate the scheme, MERS was and is used in a way so that to the average consumer, or even legal professional, can never determine who or what was or is ultimately receiving the benefits of any mortgage payments. The conspirators set about to confuse everyone as to who owned what. They created a truly effective smokescreen which has left the public and most of the judiciary operating “in the dark” through the present time.
The preparation, filing, and prosecution of the complaints to “Foreclose Mortgage and to Enforce Lost Loan Documents” were each predicate acts in the pattern of racketeering activity herein complained of, and were actions taken in furtherance of the MERS enterprise. The actions could not have been brought by the Defendant Firm without the MERS artifice and the ability to generate any necessary “assignment” which flowed from it.
By engaging in a pattern of racketeering activity, specifically “mail or wire fraud,” the Defendants subject to this Count participated in a criminal enterprise affecting interstate commerce. In addition to the altered postmarks described below, the mail fraud is the sending of the fraudulent assignments and pleadings to the clerks of court, judges, attorneys, and defendants in foreclosure cases. These Defendants intentionally participated in a scheme to defraud others, including the Plaintiff and the other Class Members, and utilized the U.S. Mail to do so.
These documents were executed by an “Assistant Secretary” or “Vice President,” apparently of MERS. In reality, the person executing the assignments had no knowledge whatsoever of the truth of their contents, and was simply an employee of the Defendant Firm.
Altering common hardware and/or software used by the Defendant Firm so that envelopes used to mail important legal documents, such as final judgments, to defendants contain no date of mailing in the postmark and intentionally delaying in sending the mail until defendants have lost their rights. (Exhibit F). These predicate acts constitute “mail fraud.”
Here is an explanation from David J. Stern of the continuing foreclosure rout:
One of my favorite questions from one of my believers, one of my investors on the first call-in, “What inning are we in? If this was a baseball game, what inning are we in?” And my response is, we’re only in the 2nd inning. We still have 3 innings of foreclosures left, and after the foreclosures, we have 3 innings of REO liquidation and as the REO liquidations pan out, we get into the re-fi and we get into the origination.
[ . . . ]
So yeah, we’re in the 2nd inning, but guess what – when we get to the 9th inning, it’s going to be a doubleheader and we got a second game coming. So when people say, “Oh my God, the economy is bad!” I’m like, “Oh my God, it’s great.” I mean, I hate to hear people are losing their homes and credit isn’t available and credit is such that they can’t re-fi, but if you are in our niche, it’s what we do and it’s what we want to see.
SAN DIEGO, Jul 23, 2010 (BUSINESS WIRE) — Robbins Umeda LLP today announced that a class action has been commenced in the United States District Court for the Southern District of Florida (the “Court”) on behalf of purchasers of DJSP Enterprises, Inc. (“DJSP” or the “Company”) (DJSP4.99, -0.09, -1.77%) common stock during the period between March 16, 2010 and May 27, 2010 (the “Class Period”).
DJSP is one of the largest providers of processing services for the mortgage and real estate industries in Florida and nationwide. The Company engages in providing non-legal services supporting real estate foreclosure, other related legal actions, and lender owned real estate services. The Company was founded in 1994 and is based in Plantation, Florida.
The complaint alleges that DJSP’s directors and officers issued materially false and misleading statements and failed to disclose adverse facts known to them regarding the Company’s business and financial results. As a result of these fiduciaries’ misstatements and omissions, DJSP’s stock traded at artificially inflated levels. The complaint charges DJSP and certain of its officers and directors with violations of the Securities Exchange Act of 1934.
Specifically, the complaint alleges that on March 16, 2010, DJSP filed a 6-K with the U.S. Securities and Exchange Commission in which it touted its quarterly results announced on March 11, 2010, and assured investors that regardless of the Obama Administration’s efforts to slow down real estate foreclosures, DSJP would continue to profit from continued defaults. Furthermore, investors were told that defaults would continue into subsequent years and that DJSP’s business would not be affected by government involvement in the mortgage market. Then in April 2010, one of DJSP’s largest clients began a foreclosure system conversion which substantially decreased the volume of foreclosures referred to the Company. Until that time, DJSP generated a significant amount of its revenue from the providing of ancillary services to referral clients.
According to the complaint, on May 27, 2010, the Company shocked the market by lowering its guidance for adjusted net income by $15 million to $17 million and for adjusted EBIDTA by $18 million to $22 million. DJSP attributed the lowered guidance to, (i) the foreclosure system conversion of one of its largest bank clients in April 2010, which resulted in a reduction in the referral of foreclosures filed; and (ii) a temporary slowdown in foreclosures due to governmental intervention programs. DJSP’s Executive Vice President and CEO explained that the reason this information was not conveyed to shareholders back in April 2010, was due to a belief that these issues would fix themselves.
If you wish to serve as lead plaintiff, you must move the Court no later than 60 days from July 20, 2010. If you wish to discuss this action or have any questions concerning this notice or your rights or interests, please contact Gregory E. Del Gaizo, Esq. of Robbins Umeda LLP, at 800-350-6003 or by e-mail at inquiry@robbinsumeda.com.
Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member.
Robbins Umeda LLP is a California-based law firm, which has significant experience representing investors in securities fraud class actions, merger-related shareholder class actions, and shareholder derivative actions. For more information about the firm, please go to http://www.robbinsumeda.com.
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SOURCE: Robbins Umeda LLP
Robbins Umeda LLP
Gregory E. Del Gaizo, Esq., 800-350-6003
inquiry@robbinsumeda.com
Oh really, well I have been a private investigator in the State of Florida for 15 years and here is the short list of investigative reports that I have posted online about David J. Stern, above is one of his exclusive photos that the St Pete Times could not obtain;
DJSP Enterprises, Inc. has been accused of securities fraud. If you are a current or former employee or are a member of any of DJSP Enterprises, Inc. investment plans or profit sharing retirement plans you may be included in this possible DJSP Enterprises, Inc. 401(k) or Employee Retirement Income Security Act (ERISA) class action. If you purchased or held DJSP Enterprises, Inc. stock in one of those plans during the periods Mar-16-10 to May-27-10, you may have a claim.
Under ERISA, DJSP Enterprises, Inc. employees can file a lawsuit against the company for putting stock options at risk. DJSP Enterprises, Inc. employees have a claim if they can prove their employer violated its fiduciary duty to its employees. Fiduciary duty refers to a company’s responsibility to the people who invest in it. If an employer puts the company’s interest ahead of the investors’, it has broken its fiduciary duty. A fiduciary is a person that exercises discretion over the management of plan assets or exercises discretionary control over the administration of the plan.
ERISA is a federal law that sets minimum standards for pension and health plans set up by private businesses. ERISA was designed to protect people who participate in employee benefit plans, including employees with stock options in a company. Stock options are a form of compensation in which employees are given the opportunity to purchase shares of the company stock at a certain price.
DJSP Enterprises, Inc. 401(k) / ERISA Legal Help
If you have suffered from DJSP Enterprises, Inc. 401(k) plan losses, you may qualify for damages or remedies that may be awarded in a possible DJSP Enterprises, Inc. ERISA class action lawsuit. Please click the link below to submit your complaint and we will have a lawyer review your ERISA complaint. If you are NOT a current or former employee of this company, please use this form to register your complaint. Thank you.
CINCINNATI, Jul 21, 2010 (GlobeNewswire via COMTEX) — Notice is hereby given that a class action lawsuit was filed by the Cincinnati law firms of Strauss & Troy and Statman Harris & Eyrich on behalf of all persons who purchased the common stock of DJSP Enterprises, Inc. (“DJSP” or the “Company”) /quotes/comstock/15*!djsp/quotes/nls/djsp (DJSP5.12, -0.21, -3.94%) between March 16, 2010 and May 27, 2010, inclusive (the “Class Period”), and who suffered damages as a result. The action is pending in the United States District Court for the Southern District of Florida.
The Complaint alleges that during the Class Period, DJSP and certain of its officers and/or directors (the “Defendants”) violated the Securities Exchange Act of 1934 by issuing materially false and misleading statements and failing to disclose adverse facts known to them regarding the Company’s business and financial results. As a result the stock traded at artificially inflated prices during the Class Period.
On March 16, 2010, DJSP informed the investing community that “…there is no stopping this inflow of continued defaults that we anticipate to go for another two or three years….foreclosure volumes through 2012 are expected to increase dramatically.” Then on May 27, 2010, DJSP shocked the market when it lowered its guidance for adjusted net income by $15 to $17 million and for adjusted EBIDTA by $18 to $22 million. On this news, the Company’s shares fell nearly 29%, opening on May 28, 2010 at $6.33 per share.
DJSP indicated that the lowered guidance was a result of (i) the foreclosure system conversion of one of its largest bank clients which resulted in a reduction in the referral of foreclosure files; and (ii) a temporary slowdown in foreclosures due to governmental intervention programs.
Plaintiffs seek to recover damages on behalf of all individuals and entities who purchased DJSP common stock during the Class Period. If you purchased common stock between March 16, 2010 and May 27, 2010, you may, no later than October 20, 2010, request that the Court appoint you as lead plaintiff. A lead plaintiff is a representative party that acts on behalf of the class members. In order to be appointed lead plaintiff, the Court must determine that you meet certain legal requirements.
If you wish to review a copy of the Complaint, discuss this action, or have any questions, please contact Richard S. Wayne, Esq., or Thomas P. Glass, Esq., Strauss & Troy, 150 East Fourth Street, Cincinnati, Ohio 45202, 800-669-9341 or by e-mail at rswayne@strausstroy.com or tpglass@strausstroy.com; or Melinda Nenning, Esq., Statman, Harris & Eyrich, 3700 Carew Tower, 441 Vine Street, Cincinnati, Ohio 45202, (513) 345-8181 Ext. 3095, or by e-mail at mnenning@statmanharris.com.
The law firms of Strauss & Troy and Statman Harris & Eyrich are Cincinnati, Ohio law firms that have successfully represented shareholders in national securities class actions. For more information, visit Strauss & Troy’s website at http://www.strausstroy.com or Statman Harris & Eyrich’s website at http://www.statmanharris.com.
CONTACT: Strauss & Troy
Richard S. Wayne, Esq.
rswayne@strausstroy.com
Thomas P. Glass, Esq.
tpglass@strausstroy.com
800-669-9341
Statman, Harris & Eyrich
Melinda Nenning, Esq.
(513) 345-8181 Ext. 3095
mnenning@statmanharris.com
(C) Copyright 2010 GlobeNewswire, Inc. All rights reserved.
Cooper et al v. DJSP Enterprises, Inc. et al
Filed: July 20, 2010 as 0:2010cv61261 Updated: July 20, 2010 21:15:00
Plaintiffs: Neeraj Methi and Stan Cooper
Defendants: David J. Stern, DJSP Enterprises, Inc. and Kumar Gursahaney
Presiding Judge: William J. Zloch
Referring Judge: Robin S. Rosenbaum
Cause Of Action: Securities Exchange Act
Court: Eleventh Circuit > Florida > Southern District Court
Type: Other Statutes > Securities/Commodities…
After reading this, why don’t you take a hop over and take a listen to an audio recording of Mr. Stern at a recent DJSP Conference. Oh and Mr. Obama…According to Mr. Stern we will see historical levels of foreclosures going well into 2017 seems like “A Plan” for the future of whats to come?
“No matter what Obama rolls out, there is no stopping this inflow of continued defaults that we anticipate to go for another two or three years late behind that is the math of REO’s that need to be liquidated and at the end of the day, the cycle will start again. Well, foreclosure volumes through 2012 are expected to increase dramatically and remain at high levels going on till 2017″
It’s a little hard to listen to him because he sounds too excited and on helium but trust me it was close enough to what he says. I wonder if his “Clients” would be pleased to listen to this convo detailing what’s in store for the future?
He did say one thing that caught my attention…”there is 50,000 REO’s in Florida that are not in the system” or something like that…Go ahead and take a listen for yourself…I am not quite certain what to make of all this …if it’s even legal? Where is the Client-Attorney Privilege? http://www.americansunitedforjustice.org/Stern.html
TampaBay.com recently exposed how some foreclosure mills are striving with wealth. In particular one law firm in the Fort Lauderdale area.
Here is another ‘Mega Estate’ under a “CERTAIN TRUST AGREEMENT” c/o The Law Offices of David J. Stern, PA 900 S. Pine Island Rd., Suite 400, Plantation Florida 33324. This is not far from his other $15,000,000.00 dollar “Mega Estate” and his $5 million dollar Ft. Lauderdale Beach condo.
This Hillsborough Estate, like his Ft. Lauderdale Estate also features a tennis court. According to BCPA.net this double lot MEGA ESTATE was purchased for a combined total of $17,000,000.00 in 2008.
Mr. Stern’s ‘nonlegal’ company DJSP Enterprises, Inc recently filed their Form S-8 with the SEC. I wonder where all these SHARES are going?
This is the follow up to the latest Depositions posted on SFF taken from The Law Offices of David J. Sterns’ employees Cheryl Samons and Shannon Smith.
I wonder if this was disclosed on DJSP Enterprise’s Prospectus letting investors be aware of this below…
David James Stern, 801 S. University Drive, Ste. 500, Plantation, reprimanded for professional misconduct following an October 24 court order. (Admitted to practice: 1991) Prior to 1999, Stern’s law firm filed potentially misleading affidavits in connection with abstraction work performed for foreclosures handled by the firm. Stern used personnel employed by his law firm to do the abstracting work rather than employees of his title company.(Case no. SC02-1991)
His address is also 900 South Pine Island Road Ste 400, Plantation FL 33324
David J. Stern, whose law firm helps banks foreclose on homeowners, owns three boats and lives in this $15 million, 16,500-square-foot Fort Lauderdale home with a tennis court.
Continue reading the full story on this “Foreclosure Mill” here….TampaBay.com
Cheryl Samons is an employee of David Stern Firm in Plantation Florida. The mere fact that she is signing documents representing the grantor when the grantee is the client of her employer’s law firm leads to questions and concerns, but:
How can an unsigned legal document get notarized and witnessed? (St. Lucie County, FL)
Bank of America took over Countrywide on June 3, 2009. How can Countrywide assign a mortgage on April 28, 2010? (Palm Beach County, FL)
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