'Foreclosure King' could be disbarred for foreclosure fraud - WFLA News Channel 8

'Foreclosure King' could be disbarred for foreclosure fraud

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AP photo of David Stern AP photo of David Stern
Tampa Bay foreclosure defense attorney Michael Wasylik Tampa Bay foreclosure defense attorney Michael Wasylik
TAMPA, FL (WFLA) -

South Florida attorney David J. Stern may be known as the mortgage industry's "foreclosure king," but he may soon lose his authority to practice law in Florida.

Stern's empire shut down in 2010, after employees went public with allegations that 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 the David J. Stern law firm.

Years after the Florida Bar started investigating Stern, it wants to disbar him. This week, Judge Nancy Perez agreed. In her report, she said Stern, "created chaos on the courts of the state of Florida, prejudicing the whole system as a whole."

Perez's recommendation for disbarment still needs to be approved by the Florida Supreme Court, and Stern could appeal.

During the housing downturn, many lenders turned to Stern's law firm to handle foreclosures because he took houses away from homeowners quickly.

Tampa Bay foreclosure defense attorney Mike Wasylik testified during Stern's 5-day trial earlier this month. Wasylik represents homeowners in foreclosure cases and discovered problems with notarizations.

"He was responsible for overseeing thousands, upon, thousand of foreclosure cases, in which many people lost their homes," Wasylik said in an interview.

He went on to say, "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 everyday, we have good jobs now and pay our bills."

The disbarment recommendation still needs the approval of the Florida Supreme Court, and Stern could appeal.

Foreclosure defense attorneys say this action could pave the way for them to win more cases. That's because thousands of Stern's Florida's 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.

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