Friday, February 18, 2011

Fannie Mae Fires South Florida Foreclosure Mill. Founding Partner Found in Contempt of Court By Miami Judge.

Palm Beach Post 
Lawyer held in contempt over 'fraud' in foreclosure filing
Kimberly MillerChristine Stapleton
Posted:  02/12/2011 4:36 PM
 A day after federal mortgage giant Fannie Mae fired the prominent law firm of Ben-Ezra & Katz, a Miami judge found the firm's founding partner, Marc Ben-Ezra, in contempt of court for filing "sham" foreclosure documents and "wasting the court's time."
On Thursday, Fannie Mae cited document "execution issues" as the reason it terminated the law firm.
Ben-Ezra & Katz becomes the second south Florida law firm making a mass exodus from the foreclosure business.
The Plantation law firm of David J. Stern began dumping thousands of its Fannie Mae cases late last year after evidence of robo-signing and other faulty documents became known.
"It's a huge can of worms that is being opened up because of changes in law firms," said James Bonfiglio, a Boynton Beach attorney who represents homeowners. "This is the way it's going to go and it's going to be  a huge mess for the next couple of years."
Miami-Dade Circuit Judge Maxine Cohen Lando expressed her displeasure Friday in a case that involved a property in Homestead with a $265,134 foreclosure judgment issued in July.
Lando said the so-called original note and original mortgage were filed months after the bank said those documents were lost.
"That in itself is a fraud upon the court," Lando wrote in an order to show cause as to why she should not hold Ben-Ezra & Katz attorneys in contempt.
But, she added, the action "pales in comparison" to the fact that the mortgage and note are to a different property in Lehigh Acres, and that the documents are improperly signed and notarized. Lando said her verbal contempt finding on Friday would be followed by a written order.
Although Marc Ben-Ezra, 44, was not the direct attorney handling the case, the homeowner's attorney Maria Mussari said the judge ordered the owner or head of the firm to appear. Ben-Ezra has no disciplinary history with the Florida Bar .
The judge dismissed the foreclosure case and banned the lender from refiling it.
In a statement late Thursday, the law firm acknowledged it had found "technical paperwork issues," but added that "there is no issue of whether the information in the affected files is correct. No homeowner has been hurt because of this."
The firm said it was correcting the issues. "Fannie Mae did not give us the chance to execute that plan," the statement said.
Fannie Mae set a deadline of Tuesday for servicers to find new firms to handle the Ben-Ezra & Katz cases. But finding replacement lawyers has proven to be frustrating. Statewide, Ben-Ezra & Katz has handled at least 18,000 cases, according to Legalprise, a West Palm Beach data analysis firm.
After Fannie Mae cut ties with the Plantation-based firm of David J. Stern, the firm withdrew from thousands of cases. Today, its replacements often come to court complaining that Stern's office has not yet turned over files. Some of Stern's cases remain lawyer-less. No one knows who represents the lender.
"Nobody shows up!" said Tom Ice, a Royal Palm Beach attorney whose firm has begun asking judges to dismiss lawyer-less cases. Last week Circuit Judge John Hoy dismissed one of them. Ice is waiting to see if any lawyer will refile the case.
"It's absolute pandemonium," Ice said.

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