A subsidiary of a company that is a top provider of the documentation used by banks in the foreclosure process is under investigation by federal prosecutors. The prosecutors are "reviewing the business processes" of the subsidiary of Lender Processing Services Inc., (LPS) based in Jacksonville, Fla., according to the company's annual securities filing released in February. People familiar with the matter say the probe is criminal in nature.
Lender Processing Services Inc., (LPS) does work for the Law Firm of David J. Stern (DJSE) in Plantation Fl. Michelle Kersch, an LPS spokeswoman, said the subsidiary being investigated is Docx LLC. Docx processes and sometimes produces documents needed by banks to prove they own the mortgages. LPS's annual report said that the processes under review have been "terminated," and that the company has expressed its willingness to cooperate. Ms. Kersch declined to comment further on the probe.
A spokesman for the U.S. attorney's office for the middle district of Florida, which the annual report says is handling the matter, declined to comment. The case follows on the dismissal of numerous foreclosure cases in which judges across the U.S. have found that the materials banks had submitted to support their claims were wrong. Faulty bank paperwork has been an issue in foreclosure proceedings since the housing crisis took hold a few years ago. It is often difficult to pin down who the real owner of a mortgage is, thanks to the complexity of the mortgage market. LPS was recently referenced in a bankruptcy case involving Sylvia Nuer, a Bronx, N.Y., homeowner who had filed for protection from creditors in 2008.
Diana Adams, a U.S. government lawyer who monitors bankruptcy courts, argued in a brief filed earlier this year in the Nuer case that an LPS employee signed a document that wrongly said J.P. Morgan Chase & Co. had owned Ms. Nuer's loan. Documents related to the loan were "patently false or misleading," according to Ms. Adams's court papers. J.P. Morgan Chase, which has withdrawn its request to foreclose, declined to comment.
A Florida state-court judge, in a rare ruling, said a major national bank perpetrated a "fraud" in a foreclosure lawsuit filed by the Law Firm of David J. Stern, raising questions about how banks are attempting to claim homes from borrowers in default.
The ruling, made last month in Pasco County, Fla., comes amid increased scrutiny of foreclosures by the prosecutors and judges in regions hurt by the recession. Judges have said in hearings they are increasingly concerned that banks are attempting to seize properties they don't own.
The Florida case began in December 2007 when U.S. Bank N.A. sued a homeowner, Ernest E. Harpster, after he defaulted on a $190,000 loan he received in January of that year. The Law Offices of David J. Stern, which represented the bank, prepared a document called an "assignment of mortgage" showing that the bank received ownership of the mortgage in December 2007. The document was dated December 2007.
But after investigating the matter, Circuit Court Judge Lynn Tepper ruled that the document couldn't have been prepared until 2008. Thus, she ruled, the bank couldn't prove it owned the mortgage at the time the suit was filed. The document filed by the plaintiff (through the Law Firm of David J. Stern), Judge Tepper wrote last month, "did not exist at the time of the filing of this action…was subsequently created and…fraudulently backdated, in a purposeful, intentional effort to mislead." She dismissed the case.
Forrest McSurdy, a lawyer at the David Stern firm (McSurdy is General Councel for Stern law Firm) that handled the U.S. Bank case, said the mistake was due to "carelessness." The mortgage document was initially prepared and signed in 2007 but wasn't notarized until months later, he said. After discovering similar problems in other foreclosure cases, he said, the firm voluntarily withdrew the suits and later re-filed them using appropriate documents.
Foreclosure mill lawyer Forrest McSurdy calls truth a “technicality”. Lawyers operating foreclosure mills often are paid based on the volume of cases they complete. Some receive $1,000 per case, court records show. Firms compete for business in part based on how quickly they can foreclose. The David Stern law firm had about 900 employees as of last year, court records show.
"The pure volume of foreclosures has a tendency perhaps to encourage sloppiness, boilerplate paperwork or a lack of thoroughness" by attorneys for banks, said Judge Tepper of Florida, in an interview. The deluge of foreclosures makes the process "fraught with potential for fraud," she said (Law Firm of the David J. Stern) .
At an unrelated hearing in a separate matter last week, Anthony Rondolino, a state-court judge in St. Petersburg, Fla., said that an affidavit submitted by the David Stern law firm on behalf of GMAC Mortgage LLC in a foreclosure case wasn't necessarily sufficient to establish that GMAC was the owner of the mortgage. "I don't have any confidence that any of the documents the Court's receiving on these mass foreclosures are valid," the judge said at the hearing.
Forrest G. McSurdy of Stern & McSurdy, P.A. Incorporated by David J Stern, Forrest G McSurdy, Stern and McSurdy, P.A. is located at 801 S University Dr Ste 500 Plantation, FL 33324. Stern and McSurdy, P.A. was incorporated on Friday, October 08, 1999 in the State of FL and is currently active. David J Stern represents Stern and McSurdy, P.A. as their registered agent.Forrest McSurdy of the Law Firm of David J. Stern in Plantation Florida appears to show up everytime there is a legal mess to clean up for the Stern Law Office, McSurdy is Stern's fixer "Michael Clayton". "Michael Clayton Movie" The Truth Can Be Adjusted Plot: A law firm brings in its "fixer" to remedy the situation after a lawyer has a breakdown while representing a chemical company that he knows is guilty in a multi-billion dollar class action suit.
Forrest McSurdy of the Law Firm of David J. Stern in Plantation Florida shows up as legal counsel for all of Stern's attorneys when there is a Florida Bar complaint filed agasint them.
Chardan 2008 China Acquisition Corp. (CACA, CACAW, CACAU) signed a definitive agreement for a business combination with DAL Group, LLC, a provider of processing services for mortgage lenders and servicers in Florida. At the closing of the business combination with Chardan, DAL will own 100% of the business and operations of Default Servicing, Inc. and Professional Title & Abstract Company of Florida and the non-legal operations supporting the foreclosure and other legal proceedings handled by the Law Offices of David J. Stern, P.A., collectively known as the Company. Default Servicing, Inc is now STERN HOLDING COMPANY - DS, INC see Florida Division of Corporations records click here.
Upon consummation of the transaction, Beijing, China-based Chardan will change its name to DJSP Enterprises, Inc. “DJSP” (David J. Stern Processing), and its stock is expected to trade on the Nasdaq under the symbols DJSP, DJSPU, and DJSPW. Assuming no redemptions by Chardan shareholders, the current owners of the company, the “Stern Parties” will receive approximately $111 million from DAL and the right to receive another $35 million in post-closing cash. In addition, “Stern Parties” will also hold equity interests. Kerry Propper, Chardan’s chief executive officer said, “The acquisition should generate significant value for our shareholders. David J. Stern, who will be DJSP’s CEO, has an impressive record building this business by continually strengthening the customer relationships on which it is based.”
Chardan 2008 China Acquisition was run by Kerry S. Propper he has had some problems with the SBA and the Department of Justice as did his father Dr. Richard D. Propper. Kerry S, Proper, Richard D. Propper and Royale Holdings own 1,151,128 shares of Chardan 2008 China Acquisition, they are the majority share holders of the company now directly linked to David J. Stern and DJSP Enterprises, Inc..
DAVID J. STERN LAW OFFICE is DJSP Enterprises on NASDAQ, Major Shareholders David J. Stern and Kerry S. Propper the Subject of Department of Justice Investigation And SBA Law Suit.
1). Kerry S. Propper was the subject of 2003 Federal law suit filed in Conn. by the Small Business Administration one of his co-defendants was Acorn Ct Investments LP, they all ended up paying the SBA $1,764,333 in total see link http://www.paed.uscourts.gov/documents/opinions/04D0487P.pdf
2). Kerry S. Propper was/is under Dept of Justice investigation with his father Richard Propper. One of their partners was convicted of defrauding the SBA and sent to Federal prison for 70 months. SBA seeks to recover $96 million from Richard Propper and the rest of the crew in yet another SBA lawsuit, see info below……
DEPARTMENT OF JUSTICE;
FRIDAY, DECEMBER 29, 2006, U.S. Files Suit Against John Torkelsen, Richard Propper, Daniel Beharry, & Sovereign Bank Alleging Fraud of $32 Million Against the Small Business Administration.
WASHINGTON – The Justice Department announced today that it has filed a lawsuit accusing John Torkelsen, Richard Propper, Daniel Beharry, and Sovereign Bank of defrauding the Small Business Administration’s Small Business Investment Company (SBIC) program of $32 million. The suit was filed in the Eastern District of Pennsylvania under the False Claims Act, which allows the United States to recover up to three times the amount of its losses plus civil penalties.
The government’s complaint alleges that Torkelsen, Propper and Beharry violated the conflict of interest and management fee rules of the SBIC program by engaging in multiple secret transactions that funneled government money into companies controlled by Propper and Beharry or Torkelsen and his family. The SBIC program has rules designed to prevent the unauthorized investment of government funds in companies controlled by those who act as managers of the SBICs. The alleged fraud is believed to be the largest perpetrated upon the program to date.
The SBIC program, administered by the U.S. Small Business Administration, was created in 1958 to fill the gap between the availability of venture capital and the needs of small businesses in start-up and growth situations. The government, itself, does not make direct investments or target specific industries. Rather, the SBIC program is a “fund of funds” – meaning that portfolio management and investment decisions are left to qualified private fund managers. Small businesses which qualify for assistance from the program are able to receive equity capital, long-term loans and expert management assistance.
The investigation of the fraud allegations against the defendants was conducted by the U.S. Attorney’s office in Philadelphia, Pa.; the U.S. Small Business Administration’s Office of Inspector General and Office of General Counsel; the Federal Bureau of Investigation; and the Justice Department’s Civil Division. The United States has settled with, or reached settlement in principle with, a number of other individuals or entities involved in the alleged fraud.
David J Stern Attorney, Related People:
•Adam S Gumsom
•Forrest G McSurdy
•Attorneys' Title Agency, P.A.
•Default Services, Inc.
•Default Servicing, Inc.
•Law Offices of David J. Stern, P.A.
•Professional Title and Abstract Company of Florida
•Stern and McSurdy, P.A.
•Sunset Servers of South Florida, Inc.
•The Harborage Association Inc.
Bill Warner Private Investigator, SEX, CRIME, CHEATERS & TERRORISM