Attorney General opens probe into eighth foreclosure firm

State investigators say Ben-Ezra & Katz presented false and misleading documents to judges

Diane C. Lade, Sun Sentinel

February 23, 2011

The Florida Attorney General has opened an investigation into Ben-Ezra & Katz, a Hollywood law firm that processes thousands of foreclosures for lenders, on allegations of presenting false and misleading documents in court.

Ben-Ezra is the eighth high-volume foreclosure practice targeted by state investigators within the past year regarding similar claims involving paperwork submitted to judges. The firm last week laid off 236 of its 568 employees days after the government-owned mortgage giant Fannie Mae terminated its relationship, citing “document execution” issues.

The Florida Bar also is investigating firm partners Marc Ben-Ezra and Marvin Katz, on one complaint each involving foreclosure fraud. Bar officials would not say when its investigation began.

Ben-Ezra spokesman Ray Casas declined to comment on the state investigation. He did release a statement announcing the law office had retained former federal prosecutor and 10-year state legislator Dan Gelber to “provide support with quality control and to help evaluate policies and procedures.”

Gelber, a Democrat, ran for Florida Attorney General last year, losing to Pam Bondi.

In its investigation filing, the Attorney General’s Office said fabricated or misleading documents had been “presented in court before judges as actual assignments of mortgages and properly prepared affidavits that have later been shown to be inadequate and/or insufficient.”

Miami-Dade Circuit Judge Maxine Cohen Lando this month castigated Marc Ben-Ezra for “wasting the court’s time” by filing “sham foreclosure documents” involving the repossession of a Homestead property. Lando cited him for contempt.

The Attorney General has argued in all eight of its foreclosure investigations that the firms’ business procedures violated the state’s unfair and deceptive trade pratices act.

The seven other law offices being investigated, of which four are based in South Florida, include: David J. Stern, Marshall C. Watson, Shapiro & Fishman, Florida Default Law Group, Kahane & Associates, Daniel C. Consuegra and Albertelli Legal.

Shapiro & Fishman and Stern’s firm are fighting the state’s subpoenas, both claiming only the Florida Bar has the authority to regulate lawyers. A Palm Beach County judge ruled in favor of Shapiro last year, but Stern lost before a Broward County judge.

Both cases now are before the 4th District Court of Appeal in West Palm Beach. Attorneys for Shapiro & Fishman presented their arguments Tuesday.

Watson and Florida Default are cooperating with the Attorney General’s investigation. The other three firms have received letters of inquiry, meaning the state has not opened an official case on them.

dlade@tribune.com or 954-356-4295

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