TAMPA — Attorney David J. Stern was known as the mortgage industry’s “foreclosure king,” his office processing paperwork from the Tampa Bay area and statewide, but he soon may lose his authority to practice law in Florida.
Stern’s Broward-based empire shut down in 2010 after employees revealed they were given cars, jewelry and even houses in exchange for falsifying and forging documents. Fannie Mae and Freddie Mac, Stern’s largest clients, canceled contracts with his law firm.
Years later, after an investigation, the Florida Bar has concluded it wants him out.
This week, Palm Beach County Court Judge Nancy Perez, appointed as a referee in the case, agreed. In her report, Perez says Stern “created chaos on the courts of the state of Florida, prejudicing the whole system as a whole.”
Perez’s recommendation for disbarment now goes to the Florida Supreme Court. Stern could appeal.
During the housing downturn, many lenders turned to Stern’s South Florida law firm to handle foreclosures because he took houses away from homeowners quickly.
Bay area foreclosure defense lawyer Mike Wasylik testified during Stern’s five-day bar trial in October. Wasylik represents homeowners in foreclosure cases and discovered problems with notarizations.
“He was responsible for overseeing thousands upon thousands of foreclosure cases in which many people lost their homes,” Wasylik said in an interview.
“The evidence presented to the bar shows these documents were systematically forged and falsified for the sole purpose of being presented to the courts. What that means is that people have lost their homes based on evidence that was not accurate, not true.”
Many local homeowners found problems with signatures on their foreclosure documents handled by Stern’s office. One of those was the case of Anita and Troy Howell, of Pinellas County. When state authorities began investigating Stern in 2010, their case fell into limbo.
“It’s so frustrating when you try to do the right thing and it turns around on you,” Troy Howell said. “We both work. We go in every day. We have good jobs now and pay our bills.”
Foreclosure defense lawyers say this action could pave the way for them to win more cases.
That’s because thousands of Stern’s Florida cases are still in legal limbo, and they say any document handled by Stern’s firm is tainted and can’t be relied upon by the court.