New York law firm fined $2 million for improper foreclosures
Steven J. Baum’s law firm, the biggest in New York has signed a settlement last week with the US Department of Justice requiring the law firm to pay $2 million and change its foreclosure practices.
The $2 million fine and the settlement is the result of a six month investigation into whether the law firm on behalf of its clients – mostly JP Morgan Chase, Wells Fargo and other big banks – filed misleading pleadings, affidavits, and mortgage assignments related to foreclosure actions.
After six months of continuous pressure Steven J. Baum signed a settlement and agreed to pay $2 million to end the probe and resolve allegations brought forth by the US attorney for the Southern District of New York. Furthermore, the law firm agreed to change its mortgage foreclosure practices, and it won’t execute any assignment as an officer or director of MERS.
The US District Attorney Preet Bharara said, until recently the law firm had bee assigning mortgages on behalf of MERS even though they had no connection to MERS, which resulted in errors in legal filings in state and federal court.
The settlement also requires the law firm to form a committee of three attorney to ensure it is in compliance with provisions o the OCC’s consent orders with 14 servicers.
And there is more: Steven J. Baum’s law firm will implement a 12-24 month training program for its attorneys that includes an overview of the foreclosure process and a review of the litigation procedures that must be followed.
According to the U.S. District Attorney’s office in Manhattan, the law firm of Steven J. Baum, P.C. “acknowledges…that it occasionally made inadvertent errors in its legal filings in state and federal court, which it attributes to human error in light of the high volume of mortgage defaults and foreclosures throughout the state of New York.”
“In mortgage foreclosure proceedings, there are no excuses for sloppy practices that could lead to someone mistakenly losing their home,” Bharara said in a statement. “Homeowners facing foreclosure cannot afford to have faulty paperwork or inadequate evidence submitted, and today’s agreement will help minimize that risk.”
The settlement got the signatures on it while “50” state attorneys general are in negotiations with the nation’s biggest lenders to solve allegations related to illegal or improper foreclosures, but it looks like the US Justice Department targets attorneys engaged in the same questionable practices, and it targets them individually.
I think this is great it is about time that somebody won one of these battles for the people. I hope in the near future we see more victories for the people and the companies responsible for this kind of thing are forced to stand accountable. Thank you for sharing this blog.
This is great. Score one more for the little guy. I hope we continue to see more reports like this one about crooked financial institutions getting caught for their wrong doing. This needs to continue and companies that contributed to the housing crisis need to be held accountable by paying restitution. This is how this industry is going to be resurrected and brought back to normalcy. The fact that professionals who should know how to do their job are now being required to take a training program shows not reckless and as a result, incompetent they were being. And this would have continued had the roof (pardon the pun) not caved in on the housing market.
I agree with Mark’s comments regarding the crooked financial institutions being held accountable and that they should be required to pay restitution for this mess they caused. The fact that these so called professionals are just now taking training is the most crazy thing I have ever heard. This is a rather important job in the industry and to have people in there that didn’t even know how to do the job makes no sense what so ever.
It seems everywhere you look these days people (both companies and individuals) are grabbing for more than their share. GREED! Although it is refreshing to see some of these situations dealt with and corrected, I personally believe that the only real solution is through God …… people giving their lives to Christ and following his teachings.
The statement issued by the law firm of Steven J. Baum, P.C. is such a classic example of a prepared statement by a squirming lawyer. Read this again and you will notice how a lawyer uses semantics to avoid culpability. “it [the firm] occasionally made inadvertent errors in its legal filings in state and federal court, which it attributes to human error in light of the high volume of mortgage defaults and foreclosures throughout the state of New York. Through the use of carefully composed words, they are essentially saying that it wasn’t our fault. We didn’t intentionally make errors in legal filings in order to game the system of laws to our financial advantage. There were just so many foreclosures to file that anyone could have made mistakes because of all the paper work. One of the biggest advantages of law school seems to be the training you get on how to make excuses to avoid getting in trouble (just like a child), but sound educated and formal in doing it.
I read another blog not to long ago that told of how these lenders were required to take this government training and testing before they could become lending officers. But something that was very interesting in this blog was that he explained if the person didn’t or couldn’t pass the testing after a few tries they would just go to work in a bank and become lenders through promotion whether they really knew how to do the job is evident now isn’t it. The people that put them in the position in the first place should be the ones paying restitution to the people.