Florida foreclosure king is a scapegoat, attorney says at hearing

The dethroned foreclosure king of Florida sat in a dingy Broward County courtroom Monday as charges of legal misconduct were levied against him and his once massive home repossession machine.

It was the first day of a Florida Bar trial pursuing 17 complaints against attorney David J. Stern, whose Plantation-based company — the largest so-called “foreclosure mill” in the state — was shuttered more than two years ago following allegations of notary fraud, forgery and flawed court documents.

Accusations of absentee attorneys, substandard oversight of young lawyers and thousands of cases left hanging after the firm shut down were added to the list Monday.

Foreclosure defense attorneys and homeowners have long howled for Stern’s head. They bristle that he remains a member in good standing with the Florida Bar. But the worn, wood-paneled courtroom was mostly empty Monday morning.

“I’m totally surprised this courtroom isn’t packed and the television trucks aren’t parked outside,” said June Clarkson, a former assistant attorney general who was fired while investigating alleged wrongdoing at several large foreclosure firms.

Stern’s company handled more than 100,000 foreclosures statewide when it was fired by most of its major clients in the fall of 2010 following the launch of an investigation by former Florida Attorney General Bill McCollum. Within weeks, the term robo-signing became mainstream as law firms and banks nationwide were accused of allowing people to sign-off on documents they never read, or forge other people’s signatures to hasten case processing.

The 83-page Florida Bar complaint against Stern alleges that one of his high-ranking employees allowed her name to be signed by others and was rewarded with a high salary, payment of household bills and a new car.

Stern’s attorney, Jeff Tew of Miami-based Tew Cardenas, said Stern can’t know every move his employees made and shouldn’t be blamed for their mistakes. At one point, Stern had 1,500 employees, including 150 attorneys.

The firm provided a 60-day training period for new hires and a “Bible” that included details needed for circuit courts statewide, Tew told the court.

Stern, Tew said, is a scapegoat. He called the attorney general’s investigation “bogus.” It fizzled out last year after the Florida Supreme Court upheld a ban preventing the state from using the Florida Deceptive and Unfair Trade Practices Act against the firm.

“There was a terrible mess in Florida because of the collapse of real estate and they are blaming David Stern for that,” Tew said during a lunch break.

Stern’s trial before Florida Bar referee and Palm Beach County Circuit Court Judge Nancy Perez is scheduled for two weeks.

Monday began with three judges called to the witness stand. Each had filed complaints to the Bar about Stern.

Judge Stanley H. Griffis of the Eighth Judicial Circuit in north Florida, said Monday he had problems with attorneys not showing up to hearings and had to help several young attorneys with their cases.

“The cases weren’t being prosecuted and it became my job to train the attorneys to prosecute the case,” Griffis said. “(Stern) is the managing lawyer for his firm and he is responsible for managing his subordinates, no matter how large the firm is.”

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