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Miami Bank Foreclosure Lawyer Recommended for Disbarment

Attorney David J. Stern was well-known in South Florida as being the leader of a mega-firm in Miami that represented numerous lenders, mortgage services-related entities, including the Mortgage Electronic Registration Services, and various financial institutions, including Fannie Mae and Freddie Mac.

Our Miami foreclosure defense lawyers know that the height of his career, Stern employed some 1,500 people, 150 of those top-tier attorneys. Since 2008, his firm had churned out hundreds of thousands of foreclosure cases.

However, according to the Florida Bar, Stern and his firm operated so sloppily and with such blatant disregard for the rule of law, he has now been recommended for disbarment as an attorney. If approved by the Florida Supreme Court, he will no longer be allowed to practice law in the state of Florida.

This action is significant because it is a rare example of one of these attorneys finally being held accountable for the blatant disregard with which they treated peoples’ lives and homes in the midst of the housing crisis scandal. In fact, firms like these were a big part of the reason the problem perpetuated to the level that it did.

In its original complaint, Florida Bar v. David James Stern, the Bar noted many allegations of misconduct against Stern and his supervisory attorneys.

Among those:

  • Missed hearings, case management conferences, trials and other court proceedings;
  • Improperly executed or improperly notarized documents, which included assignments of mortgage and affidavits of attorneys’ fees;
  • Ex parte motions to cancel foreclosure sales and set aside final foreclosure judgments that were improperly drafted and filed;
  • Hundreds of attorneys who were charged with handling thousands of foreclosure files, even though they had substandard administrative support, direction, oversight, control or supervision;
  • Allowing thousands of foreclosure cases and clients to be left without proper representation at various stages of the process.

This often resulted in foreclosure documentation submitted to the courts that was riddled with inaccuracies, incomplete and in some cases even forged with back dates and other elements.

In all, the Bar alleged 17 counts of misconduct against Stern, including an array of attorney mistakes, negligence and fraud in handling foreclosures. Non-attorneys also were accused of some elements of the same, such as failures to release liens and reinstate mortgages in a timely manner so that people could save their homes. Additionally, Stern and his offices were found to have simply left clients without representation, failing to either tend to the case or withdraw as the counsel of record. They were collecting checks for their work in some 100,000 cases, but not actually doing the work in those cases, the Bar said.

In one case, for example, a judge reported that he dismissed 15 cases for failure of counsel to appear between July 2009 and December 2009. It was five months before Stern’s firm contacted the judge to arrange a meeting regarding the dismissed cases, and at no point was there any explanation as to the failure to appear.

The Nineteenth Judicial Circuit of Florida’s former Chief Judge characterized Stern’s actions with regard to his cases as “abandonment.”
According to the Bar, Stern “created chaos on the courts of the state of Florida, prejudicing the whole system as a whole.” Six circuit court judges even testified to this fact in various proceedings. (Stern countered that “only” six judges had testified against him.)
The Bar noted his actions resulted in “massive injury” to the court system, indicative not of an isolated incident or two, but rather a culture of his firm that reflected a low level of competence as well as ethics.

Stern was far from the only firm to engage in such practices. We hope the others will be similarly examined and penalized.

If you’re battling foreclosure in Miami or the surrounding areas contact Jacobs Legal 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.

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