EDITOR’S COMMENT: The unfortunate moral of the story is that crime actually DOES pay even if you are caught. That 7 million homes were yanked out from under homeowners and millions more are on the butcher block doesn’t seem to matter. Stern made something like $100 million doing what he was told to do. The mega banks rented his license, used “his” office and started the foreclosure mill just like they did for dozens of other lucky lawyers. Sure their reputations will take a hit. Maybe he’ll lose his law license. Who cares?
How else would they ever have been in the position of living the good life of yachts and jets, and multiple homes all over the world. Conscience? Well everything has its price. I guess money might not buy happiness but it sure let’s you suffer in comfort. Somehow I doubt any of them are suffering, and the absence of criminal prosecutions shows the extent to which our government has been acquired by the banks. Is this the end of the story? Not for me.
A Lawyer Under Investigation Shuts Down His Foreclosure Practice
David J. Stern, one of the country’s best-known beneficiaries of the foreclosure boom, who pocketed millions from evictions processed by his Florida law firm, told regulators on Monday that he was shutting down his foreclosure practice.
Mr. Stern’s law firm in Plantation, Fla., will end its involvement in all pending foreclosures at the end of the month, according to a filing with the Securities and Exchange Commission.
A lawyer who enjoyed a lifestyle of mansions and flashy sports cars and owned a yacht called Misunderstood, Mr. Stern and his law firm have been at the center of an investigation by the Florida attorney general’s office into whether numerous law firms falsified documents to speed up foreclosures.
Mr. Stern’s lawyer, Jeffrey Tew, said he would not comment beyond what was in the S.E.C. filing.
At its peak in 2009, the Stern law firm handled 70,000 foreclosures, or about 20 percent of such actions in the state, bringing in $260 million in revenue.
But after the announcement of the investigations, Mr. Stern’s law firm lost its biggest clients, including Citibank and the mortgage lending giant Fannie Mae. Its executives left, and the company laid off most employees.
The law firm’s primary client was DJSP Enterprises, a publicly traded company that acquired the back-office operations of the David J. Stern law firm in early 2010. The plan was to replicate the law firm’s foreclosure business model in several states as millions of people across the country continued to lose their homes.
The public offering netted Mr. Stern $60 million, but it appears to have been a money loser for other investors. Shares of DJSP Enterprises, which traded as high as $14 last summer, traded at 14 cents Monday on Nasdaq.
One of those investors, Kerry Propper, who runs a boutique investment bank on Wall Street, did not respond to an e-mail seeking comment.