Saturday, December 17, 2011

Arkansas Man Pleads Guilty To Interference w/ Housing Rights Due To Race, Conspiracy For Role In Firebombing Interracial Couple's Home

From the U.S. Department of Justice:
  • Gary Dodson, 32, of Waldron, Ark., pleaded guilty [] in U.S. District Court in Little Rock, Ark., to one count of civil rights conspiracy, one count of interference with housing rights due to race and one count of possession of an unregistered firearm/destructive device for his involvement in the Jan. 14, 2011, racially motivated firebombing of the home of an interracial couple in Hardy, Ark.

  • Dodson, along with Jason Barnwell, 37, of Evening Shade, Ark.; Jake Murphy, 19, of Waldron; Dustin Hammond, 20, of Hardy, Ark.; and Wendy Treybig, 31, of Evening Shade, were indicted in April by a federal grand jury on civil rights charges and other federal charges stemming from their participation in the racially motivated firebombing and their attempts to obstruct a federal investigation.

  • During the plea proceedings, Dodson admitted that on the night of Jan. 14, 2011, while at a party at Barnwell’s house in Evening Shade, he, Murphy, Hammond and Barnwell devised a plan to firebomb the victims’ house.

  • Dodson then drove all four men from Barnwell’s residence to the victims’ house in Hardy. When they arrived, Barnwell, Murphy and Hammond constructed three Molotov cocktails and threw them at the house. They damaged the victims’ house, however, the victims were not injured.

  • The victims’ home was attacked and their safety threatened because of their race. Such violence and intimidation has no place in our society,” said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. “The Justice Department will continue to vigorously prosecute individuals who commit such atrocious acts of hate.”


  • Dodson faces a maximum penalty of 30 years in prison. Sentencing has been set for April 6, 2012. Barnwell, Murphy, Hammond and Treybig have already pleaded guilty for their involvement in this matter.

For the U.S. Justice Department press release, see Arkansas Man Pleads Guilty to Civil Rights Offenses for Involvement in the Firebombing of Interracial Couple's Home.

90-Year Old Homeowner Facing Foreclosure On Reverse Mortgage Over Code Violation Gets Help From Local Junk Removal Service In Effort To Save Home

In SouthwestMiami-Dade, Florida, WSVN-TV Channel 7 reports:
  • A 90-year-old South Florida woman facing foreclosure received much needed help cleaning up her yard. Jack's Junk Removal stepped forward to assist Rosalee Green, Tuesday, in helping remove the mess from her front yard.

  • "Basically what we are going to do, we are going to focus on getting the yard cleaned up like they requested," said Jack Vallagi. "In this case, we saw it on the news, Channel 7," said Juan Gallo.

  • After seeing Green's story on 7 News, Jack's Junk Removal offered to clean the yard for free. "We are gonna focus on getting everything up, we are gonna have a full crew, with two trucks on site," said Vallagi.

  • A lending company began foreclosing on the home Green has lived in for more than 50 years saying she hasn't maintained the yard of her home. "What I am in now? A mess," said Green.

  • The company also wanted more than $100,000 back from Green because of the mess. Green hopes that once the clean-up is complete, the company will pull the foreclosure paperwork.

  • "I have been here for this long, where am I gonna go," she said.

Source: Elderly woman facing foreclosure receives help.

For earlier post, see 90-Year Old Woman Faces F'closure On Loan Requiring No Payments; Bankster Says Debris Near Home Is Code Violation, Constitutes Default On Reverse Mtg.

Dozen Businesses Face The Boot Despite Never Having Missed Lease Payments As Landlord Stiffed Lender, Allowing Mall To Fall To Foreclosure

In St. Peters, Missouri, KMOV-TV Channel 4 reports:
  • Several St. Charles County business owners are feeling the wrath of foreclosure despite never falling behind on their payments.

  • Twelve businesses, located in the Golden Triangle Centre mall in St. Peters, received a letter on November 28 stating they have to be out of their store lots by the end of this year. If the businesses fail to comply, a lawsuit will be filed against the store owners.

  • The businesses are being forced out because the previous owner was foreclosed on by Providence Bank. “We were devastated,” Dawn Libbert, business owner, said. “We thought that this might happen. All summer long there was a suspicion this could be, but when you officially find out…it’s devastating.”

  • Some of the business owners were interested in purchasing the shopping plaza, but claim no one at the bank would listen to their plan. Some believe the reason might be because a CVS Pharmacy will be coming to the plaza.

  • A City of St. Peters official told News 4’s Brian Feldman that it cannot do anything because it is a private transaction and the president of Providence Bank was out of the office and unable to comment.

Source: St. Charles County businesses foreclosed because of previous owner.

NC Man Barred From Loan Mod Business For Doing No Work After Pocketing Upfront Fees Now Targeted For Taking Cash & Peddling Phony Roofing Services

From the Office of the North Carolina Attorney General:
  • A Charlotte area roofer who took money for jobs he never started has been ordered to stop, Attorney General Roy Cooper announced []. “Shady roofers who take money and don’t perform must be stopped,” said Cooper. “Consumers should always be skeptical when someone shows up at their home offering repairs at a deep discount.”

  • Last week, Wake County Superior Court Judge William R. Pittman agreed with Cooper’s request to temporarily bar Reginald Keith Turner, who did business as Triple R Restoration and Pinnacle Restoration, from offering to perform or taking any money for roofing services. Cooper is seeking to shut down Turner’s roofing businesses permanently and win consumer refunds and civil penalties.

  • This isn’t the first time Cooper’s office has had taken Turner to court. In June, 2010, Cooper filed suit against Turner for operating a foreclosure assistance scheme and collecting money upfront for help he never provided.

  • In January, 2011, a Wake County judge permanently banned Turner from foreclosure or debt assistance work in North Carolina. The Attorney General’s Office first learned about Turner’s roofing tactics when a woman from Matthews complained about his failure to fix hail damage to her roof.

  • According to the consumer’s complaint, Turner knocked on her door and offered to repair her roof. She paid him a $3,000 deposit, money she had received from her insurance company. Turner promised to replace her roof within four weeks but failed to perform any work, claiming that he was delayed by weather.

  • After two more missed appointments, the homeowner asked for a refund. Turner dodged her phone calls which led her to write two letters demanding a refund. Finally, Turner responded that he would refund her money when he collected money from other customers. She has yet to receive any money back and can’t afford to pay someone else to fix her leaky roof.

  • The Matthews homeowner is one of 12 consumers who have filed complaints about Turner’s roofing companies with the Attorney General’s Office

For the North Carolina AG press release, see AG Cooper shuts down shady roofer (Charlotte roofer made off with homeowners’ deposits, failed to do work or provide refunds).

Courthouse Facing Foreclosure? Option Being Considered As Judicial Building Loan In CNMI Falls Into Default

From somewhere way out in the western Pacific Ocean (I think?), in the village of Capital Hill, on the island of Saipan in the United States Commonwealth of the Northern Mariana Islands (CNMI), the Saipan Tribune reports:
  • The board of trustees of the NMI Retirement Fund directed on Friday its administrator, Richard Villagomez, to discuss and clarify once and for all issues about the judicial building loan with the Fitial administration before the board starts deliberating on the foreclosure option, which will be the board's last resort to collect its investment.

  • Fund chair Sixto Igisomar made this clear during the board meeting Friday after learning that the government/judiciary has not been remitting payment pursuant to the loan agreement for 10 months now. Villagomez reported that the outstanding arrears from the agency is approximately $1.2 million as of Nov. 30 this year, or an expected monthly remittance of $120,000.


  • The foreclosure option came into the discussion when the board attorney, Carolyn Kern, said that in usual cases of delinquent loans, the board's ultimate step to collect is through their collaterals or through foreclosure.

  • It was the Judicial Building Financing Act of 1994 that allowed the CNMI government to secure a loan from the NMI Retirement Fund in order to build the Guma Hustisia, which has a maturity date of Aug. 14, 2015.

  • The construction of the Judicial Complex began in 1995. It was completed in May 1998. The revenues generated by the Judiciary was the primary source of repayment of the loan.

For more, see Fund: Judicial building loan arrears at $1.2M.

Friday, December 16, 2011

Man Linked To Metro Atlanta Sovereign Citizen Home-Snatching Racket Cops Racketeering Plea, Agrees To Testify Against Others

In Sandy Springs, Georgia, WSB-TV Channel 2 reports:
  • One of the men linked to a real estate scheme exposed by a Channel 2 Action News investigation, pleaded guilty to racketeering Tuesday. Kenith Beniaih Rey admitted trying to steal a $2 million home in Sandy Springs. It was still under construction when he filed a quit claim deed in his name, turned on the power and alarm system, and moved in an armchair and suitcases.

  • "He was also involved with a co-defendant who was deeply engrained in the organization, a man by the name of Richard Terrance Jenkins," prosecutor John Melvin told the judge. Jenkins sat watching in the courtroom. He and Rey were indicted in March along with 10 others. Jenkins is accused of trying to steal six houses.

  • Rey said he was just interested in acquiring foreclosed houses and that Jenkins roped him into the scheme. "They began to show me some of the properties that they had. I decided to acquire his services," Rey said.

  • But the homeowner was able to escape foreclosure, found Rey's belongings and called Sandy Springs Police. "It was one home that was an abandoned foreclosure that I was trying to acquire. He was like 'let me show you how to acquire it,' and we went down to the courthouse and filed documents which he had provided," Rey said.

  • Rey will serve five years on probation, minus the nearly one year he's already been in jail. Deputies re-arrested Rey after the Channel 2 investigation linked him to a group of sovereign citizens who used bogus paperwork to take over vacant and foreclosed homes across the metro-Atlanta area.

  • Rey said he is not sovereign. "Mr. Rey wanted to make it clear that is not him. He did this because he thought he was entering a business opportunity, recognizes that it was too good to be true and should have had more sense. But he is not part of this enclave of persons who are out there committing these acts," Karlyn Skall, Rey's attorney, said.

  • As part of the guilty plea, Rey agreed to testify against his co-defendants.(1) "Do you want to explain how all this happened?" Channel 2 investigative reporter Jodie Fleischer asked Jenkins outside the courtroom. "Nope," he replied, walking away with co-defendants Jermaine Gibson and Gregory Ross.

  • One held a copy of Black's Law Dictionary, popular with Sovereign Citizens, who claim they are immune to our laws. Two of the defendants are still in custody, unable to afford their bond.


  • Fleischer's investigation helped law enforcement link nearly a dozen people to the real estate scheme. She uncovered at least 18 stolen properties in eight metro area counties. The remaining defendants will likely go to trial early next year. The prosecutor told the judge he intends to ask for much tougher sentences for several of the other defendants, but agreed to probation for Rey because he was not a central figure in the case.(2)

Source: Man takes guilty plea in real estate scheme.

(1) The only question remaining is how many bodies this guy succeeds in 'throwing under the bus' as part of earning his light, no-jail-time sentence:

  • "When a conspiracy is exposed by an arrest or execution of search warrants, soon-to-be defendants know that the first one to "belly up" and tell what he knows receives the best deal. The pressure is to bargain and bargain early, even if an indictment has not been filed." United States v. Moody, 206 F.3d 609, 617 (6th Cir. 2000) (Wiseman, J., concurring) (referring to the not-uncommon 'race to the courthouse' that breaks out among participants in an uncovered criminal conspiracy).

(2) Ibid.

Indiana Homeowners Victimized By Loan Modification Ripoffs To Begin Receiving Partial Recoveries Of Upfront Fees From New State Fund

From the Office of the Indiana Attorney General:
  • More than 70 victims of foreclosure-rescue fraud will receive payments totaling $60,000 from Indiana's newly created Consumer Protection Assistance Fund (CPAF), according to Indiana Attorney General Greg Zoeller.

  • "This important fund provides some relief for consumers who assist my office to bring legal actions against businesses that prey on consumers' who are financially vulnerable as well as helping warn others to avoid these scams," Zoeller said. "Our office is appreciative of our state lawmakers' efforts to create the Consumer Protection Assistance Fund to give victims who are facing difficult times the means to recover some or all of their losses."


  • During the foreclosure crisis, many homeowners were victimized by foreclosure-rescue fraud, deceptive credit-services or home-loan practices. Many consumers then filed complaints with the Attorney General's Office.

  • Default judgments against companies do not often result in the victims receiving any payments for their financial losses. In order to help those who reported these types of violators to the state, the 2011 Indiana General Assembly passed legislation creating the CPAF.

  • To save taxpayer dollars, legislators allowed the monies to originate from funds recovered from companies sued by the attorney general for violating consumer protection laws. Zoeller said the CPAF was modeled after a restitution fund that paid more than $125,000 to Indiana victims of American Escrow, a Chicago-based company that failed to pay more than $1 million in property taxes collected from homeowners.

For the Indiana AG press release, see Indiana fraud victims to receive compensation from new fund (Fund reimburses consumers who assist AG with enforcement of consumer protection laws).

Efforts Targeting Homeowners Stiffing Counties On Real Estate Taxes Through Use Of Improper Homestead Exemption Claims Continue

In Greenwood, Indiana, WISH-TV Channel 8 reports:
  • A central Indiana county is hiring an outside company to ensure that local residents aren't claiming homestead exemptions on property in more than one state. Johnson County Auditor Jan Richhart tells the Daily Journal the effort will ensure everyone who receives the property tax deduction is entitled to it.

  • County commissioners have hired SRI to search databases for fraudulent claims for tax credits. The company will contact the taxpayers and collect the money. SRI will receive 20 percent of the money collected. Most of the remainder will go back to the county auditor's office.

  • Richhart says violators will be required to pay the taxes they would have owed without the credit plus a 10 percent fine. Those who don't pay could see their property auctioned at a tax sale.

Source: Johnson Co. cracks down on tax exemptions.

Thursday, December 15, 2011

Antitrust Feds Bag Five More Suspects In Ongoing Probe Throughout Northern California Into Foreclosure Sale Bid Rigging Rackets

In Sacramento, California, the Central Valley Business Times reports:
  • Four real estate investors and one auctioneer or “crier” have been indicted by a federal grand jury in Sacramento for their alleged participation in conspiracies to rig bids and commit mail fraud at public real estate foreclosure auctions held in San Joaquin County.

  • The indictment, which was returned on Dec. 7 and unsealed Tuesday, charges Wiley Chandler, 47, of Lodi; Andrew Katakis, 47, of Danville; Donald Parker, 48, of Valley Springs; Anthony Joachim, 44, of Stockton; and Theodore Longley, 62, of Roseville, with conspiring with other unnamed co-conspirators to rig bids and commit mail fraud when purchasing selected properties at public real estate foreclosure auctions. The indictment also charges Mr. Longley, the crier, with aiding and abetting the conspirators.

  • According to the indictment, Messrs. Chandler, Katakis, Parker, Joachim, Longley, and co‑conspirators agreed to suppress and restrain competition by rigging bids to obtain selected properties offered at public auctions in San Joaquin County. The conspirators also devised a scheme to fraudulently acquire title to selected properties sold at the public auctions and to divert money to co-conspirators that would have gone to the beneficiaries, the government says.

For more, see Five indicted for bid rigging and fraud at Central Valley foreclosure auctions (14 now charged in the continuing investigation; ‘The indictment … alleges … conspiracy, deceit, and heavy-handed tactics to take advantage of a depressed housing market’).

Go here for other posts & links on bid rigging at foreclosure and other real estate-related auctions.

Go here for links to more from the U.S. Justice Department on bid-rigging prosecutions.

Brooklyn Judge Boots Foreclosure With Prejudice Over Lawyer's Falilure To Submit Required Affirmation Verifying Accuracy Of Filings

In Brooklyn, New York, Reuters reports:
  • On Monday, a Brooklyn judge dismissed a mortgage-foreclosure case over a major New York firm's failure to vouch for the veracity of its court filings amid questions over whether it used a "conflicted robosigner" to support its case.

  • On July 28, Justice Arthur Schack gave attorneys from Rosicki Rosicki & Associates 60 days to file documents affirming they had taken "reasonable steps" to verify the accuracy of documents filed in support of a bank's motion to foreclose on a Brooklyn property.

  • The affirmations are required in every foreclosure case brought since October 2010, when New York Chief Judge Jonathan Lippman ordered counsel for foreclosing banks to add an extra layer of review to prevent abuses such as deficient notarization and "robosigning" large numbers of documents without first checking their accuracy.

  • Rosicki attorneys sought to push back that deadline in order to get more time to double-check the paperwork. In a supporting statement filed last September, the firm said it would be "unduly harsh and inappropriate to dismiss this action on the basis of a delay in submitting an affirmation to the court."

  • But 137 days after the July 28 order, Schack ruled that the firm's time had finally run out. The failure to submit the affirmation "demonstrates delinquent conduct by Rosicki Rosicki & Associates," Schack wrote. "This mandates the dismissal with prejudice of the instant action. Failure to comply with court-ordered time frames must be taken seriously."

For more, see 'Conflicted robosigner' equals no foreclosure: NY state judge.

NJ Man Cops Conspiracy Plea In Straw Buyer Scam Targeting Homeowners In F'closure, Financially Strapped Developers Looking To Unload Unsold Inventory

From the Office of the U.S. Attorney (Camden, New Jersey):
  • A New Jersey man admitted [] to conspiring to participate in a mortgage fraud scheme that caused lenders to release approximately $3 million based on fraudulent loan applications and conspiring to launder the proceeds of the fraud, U.S. Attorney Paul J. Fishman announced.

  • Jerry Smith, 45, of Scotch Plains, N.J., pleaded guilty to an Information charging him with one count of conspiracy to commit wire fraud and one count of conspiracy to commit money laundering.


  • According to documents filed in this case and statements in court:

    Smith’s co-conspirators located oceanfront condominiums built by financially distressed developers in Wildwood Crest and North Wildwood, N.J., as well as other properties in New Jersey owned by financially distressed homeowners facing foreclosure.

    Smith and his co-conspirators recruited “straw buyers” to purchase those properties. The straw buyers had good credit scores but lacked the financial resources to qualify for mortgage loans.

    Smith’s co-conspirators created false documents, such as fake W-2 forms, pay stubs, bank statements, retirement account statements, and cancelled rent checks, to make the straw buyers appear more creditworthy than they actually were in order to induce the lenders to make the loans.

For the U.S. Attorney press release, see Scotch Plains, N.J., Man Admits $3 Million Mortgage Fraud Scheme.

Wednesday, December 14, 2011

Sovereign Citizen Gets Five Years For Paper Terrorism Extortion Racket; Filed Liens Totaling In The Trillion$ Against Cops, Judges, Credit Union CEO

In Albany, New York, the Times Herald Record reports:
  • An anti-government bully was sentenced Monday to five years in federal prison for using fake bills, bogus property liens and bizarre court filings to attack Ulster County bankers and government officials.
  • Richard Ulloa, 52, was sentenced on seven counts of mail fraud for using the U.S. Postal Service to deliver phony bills and liens that threatened to harm the credit of bankers and public officials.

  • The tactic is known as "paper terrorism." Ulloa remained defiant till the end. Even though he filed roughly $4 trillion in liens and bills against police, judges and county employees, Ulloa told a judge in Albany that it was he who lost more than anyone. "I lost a job, I lost a business and I lost property," said Ulloa, who once earned more than $180,000 a year as an IBM engineer. "I have lost more than anybody else."

  • Ulloa, of Stone Ridge, is a member of the sovereign citizens, a national movement of radicals who do not believe the government has the right to create or enforce laws. His anti-government scheme took many turns.

  • It started in 2008, when the Mid-Hudson Valley Federal Credit Union began foreclosure proceedings on his Ridge Mountain Road home. Ulloa responded by sending a "criminal complaint" to the bank, demanding $46 million from its officers. When the bank didn't pay, he filed a $2.8 billion lien against bank CEO Bill Spearman.

  • The pattern repeated itself twice more, when Ulloa was issued traffic tickets in Rosendale and the Town of Ulster. He filed bills and liens against police officers and judges in both municipalities. He also filed bogus papers against Ulster County officials.

  • Soon after federal authorities charged Ulloa and two co-conspirators in 2010, the sovereigns took even stranger actions. Court papers show they convened a kangaroo court in Highland, issued fake indictments against their victims and threatened to have sovereign "rangers" arrest them.

  • Despite being cleared by a mental-health evaluator, Ulloa's lawyer argued Monday that his client had become mentally ill sometime over the past six years.U.S. District Judge Thomas McAvoy didn't buy the argument. "Somewhere along the way, you decided to follow the voice of the sovereign citizens," McAvoy told Ulloa. "You did that with reckless disregard and evil intention." Ulloa must pay $63,401 in restitution to Ulster County and MHVFCU.

  • His scheme instilled fear in its victims, because sovereign citizens in other parts of the country have turned violent, even killing cops in two cases. MHVFCU and Ulster County handed out photos of Ulloa to some employees, urging them to call security if he showed up.

  • "There was a lot of anxiety about this guy coming into our offices," said Spearman, the bank CEO. "There were some concerns that he might act out."

For more, see Ulster 'paper terrorist' gets 5 years (Stone Ridge man, 52, sued, schemed against officials).

Go here for earlier posts on this crackpot.

90-Year Old Woman Faces F'closure On Loan Requiring No Payments; Bankster Says Debris Near Home Is Code Violation, Constitutes Default On Reverse Mtg.

In Southwest Miami-Dade, Florida, WSVN-TV Channel 7 reports:
  • An elderly woman is facing foreclosure in the place she has called home for most of her life. Ninety-year-old Rosalee Green has lived in her Southwest Miami-Dade residence about 57 years, the majority of her life.

  • However, the nonagenarian may be evicted from her home due to a code violation. "I've been here this long. Where am I going to go? I'm 90 years old," said Rosalee Green. "I want to stay in my house."

  • Green was recently served with papers that said she defaulted on a reverse mortgage, which allowed her to take a lump-sum payment against her home's equity without having to pay back the money.

  • "They said that I didn't have to pay anything until, if I die, whoever lives here would take over, and so, I figured that was it," she said. According to Green's son, Dale Green, his mother needed the money from the reverse mortgage because she does not have steady income. "We've been doing whatever we can to keep up with things going on around here," he said, "but income is low, and we're just trying to stay above water."

  • Now,the lending company that loaned the money to Rosalee wants the money back, and the 90-year-old may soon face eviction.

  • The company claimed that debris near Rosalee's home is a code violation, which nullifies the reverse mortgage. Rosalee's attorney, Eric Stine, said, "For them to find a little technical flaw, which is what they're trying to hang their hat on, and displace a 90-year-old lady from her home, we just feel is bad faith."

  • Stine said that the lending company did not give his client a chance to fix the violation, so she could remain in the home where she raised her 11 children. "It's a mess," Rosalee said. "I don't think it's fair. If I would have known [this would happen], I would have never, never [got the mortgage]."

  • The out-of-state lending company told 7News by phone that if Rosalee can prove she has cleaned up some of the debris near her home, and she has kept her home's taxes current, she may be able to avoid foreclosure.

Source: 90-year-old woman facing foreclosure.

Ohio AG Announces Toothless Settlement Agreement With Loan Servicer Over Allegedly Inadequate Loan Modification Practices

From the Office of the Ohio Attorney General:
  • Ohio Attorney General Mike DeWine [] announced an agreement with American Home Mortgage Servicing Inc. (AHMSI) to settle a 2009 lawsuit filed in Franklin County Common Pleas Court that alleged AHMSI violated Ohio consumer law by providing inadequate services to consumers seeking loan modifications.

  • "This agreement will help Ohio homeowners receive fair, improved and faster treatment when negotiating a loan modification or trying to avoid foreclosure," Attorney General DeWine said. "We are pleased that American Home Mortgage Servicing has worked with our office to reach this settlement and to help Ohioans."

  • In the settlement, the Attorney General and AHMSI agree to mortgage servicing standards that will apply to all AHMSI-serviced Ohio loans. The servicing standards include:

    1) Borrowers who complete a loan modification application will be assigned a single point of contact with AHMSI.
    2) AHMSI will implement a specific timeline for all loan modification requests.
    3) AHMSI will temporarily suspend foreclosures when a borrower completes a loan modification application and will implement an internal review process for denied loan modifications.
    4) AHMSI will no longer assert in loss mitigation agreements that consumers have no right to claims against lenders or holders of notes.

For the Ohio Attorney General press release, see Attorney General DeWine Announces Settlement with American Home Mortgage Servicing.

Tuesday, December 13, 2011

NC Man Booted From Home Without Receiving Notice Of Foreclosure Recovers Title, Sues Servicers Saying They Knew Of Problems & Sold Home Anyway

In Raleigh, North Carolina, WRAL-TV Channel 5 reports:
  • A Raleigh homeowner is suing two loan companies, claiming they intentionally misled the court in order to kick him out of his home.

  • Christopher Joy said the problem started when his mortgage company merged with another. Shortly after, he got a letter saying his payment was to increase by $1,000 per month. Joy said he tried to resolve the mistake but could not get answers.

  • The two trustee companies eventually took over his mortgage and started foreclosure proceedings. Joy said he was looking forward to his day in court. “Someone would finally get a chance to hear my story,” he said.

  • However, the case was continued, and Joy said he never heard another word about the issue until the sheriff's office sent a letter saying he had to pack up everything and move out. “I discovered that my house was actually sold in January, and I was actually still living in the home,” Joy said.

  • Joy said he missed the hearing to fight for his home because the trustee companies never notified him of the court date, which is required by law. He pulled his file from the Wake County clerk's office and found errors, including a court order that was never signed. “At that point, I knew deep down in my heart that something was wrong,” Joy said.

  • Clerk of Superior Court Lorrin Freeman said that it became clear the companies did not notify Joy and misreported information to the clerk's office, so the court issued an immediate order to give Joy back his home.

  • Joy and his attorneys have filed a federal lawsuit, saying they have proof that employees of Nationwide Trustee Services and Litton Loan Servicing knew about the mistakes early and intentionally pushed forward with foreclosure anyway. “Before I was wrongfully evicted out of my home, someone knew that they did something wrong,” Joy said.

Source: Raleigh homeowner sues mortgage companies over eviction.

Closing Agent Screw-Up Failing To Clear Existing Mortgage Leaves Homebuyers' Equity Tied Up In Escrow Upon Subsequent Sale 12 Years Later

In Avenel, New Jersey, The Star Ledger reports:
  • It’s not uncommon for funds to be held aside in escrow during a home sale. The money is kept on the side as an assurance that a seller will fulfill any outstanding obligations to a sales contract. But that’s not how it happened for Michael Moore, 64, of Avenel, who sold his home in Clark in November 2010.

  • "I gave power of attorney to the lawyer for the closing," said Moore, 64. "He said they were withholding $7,500 and it would take about two weeks until the paperwork was completed."

  • But more than a year later, the escrow funds had not been returned. Here’s what happened.

  • Moore bought the home with his long-time girlfriend in 1998. They decided to sell in November 2010, and the couple had separate attorneys for the transaction.

  • The new buyers’ lawyer said there was an outstanding mortgage on the property. Moore said that couldn’t be. "We put down $200,000 and had a $40,000 mortgage, and that mortgage was paid off," he said. "When we bought the house we got title insurance so everything on the house should have been clear."

  • But apparently, it wasn’t. All mortgage lenders require title insurance, which protects the homeowner and the lender in case there are any unpaid property taxes or other liens on a property. Records showed there was a $133,000 mortgage from First Residential Mortgage dating back to 1993, in the names of the owners who sold the home to Moore and his girlfriend.

  • But Moore’s settlement statement when he bought the home showed that mortgage had been paid off. And even if the loan hadn’t been paid off, the title insurance policy – written by Old Republic Title of Minneapolis – would have covered Moore and his girlfriend.

  • The couple’s attorneys tried to get the escrow funds released, but the new buyers’ attorney, Adolph Sicheri, wouldn’t budge. "There is an open mortgage of record and it’s the seller’s responsibility to clear the home," Sicheri said. "That’s all we’ve been asking."

  • Sicheri recommended that Moore file suit to have the loan discharged, or contact the lender, First Residential Mortgage, for proof that the loan was paid. Moore said he couldn’t afford to go to court, and the evidence of payment was already in the closing paperwork.

  • "I’m not releasing that money until they do the right thing," Sicheri said. "It’s still a cloud on the title."

For more, see Getting escrow funds released no easy deed.

Trial Set For Suspect Accused In Home Title-Snatching Scam; Allegedly Filed Phony Deeds On Vacant F'closures, Then Sold Or Rented To Unwitting Victims

In Denver, Colorado, the Denver Business Journal reports:
  • A man accused of duping people into buying or renting homes he didn’t own will stand trial on felony theft and forgery charges, a judge decided Monday, according to the Denver District Attorney’s Office. Alfonso Carrillo, 50, faces multiple counts of theft, forgery and offering a false instrument for recording in connection with the alleged scam.

  • Prosecutors say Carrillo used his business, America’s Home Retention Services, to file phony deeds on houses vacated through foreclosure to get access to the property and pose as the owner.

  • The charges allege he took thousands of dollars in payments from unsuspecting potential home buyers and then gave them fraudulent deeds to properties,” according to the DA’s news release. “The actual property owners were unaware the property had been ‘sold.’”

  • Carrillo targeted undocumented, Spanish-speaking buyers who would be reluctant to go to police.

For the story, see Trial set for alleged fraudulent homeowner.

Monday, December 12, 2011

Florida Supremes Send Shivers Thru Bankster Community; Kibosh Sneaky Effort To Buy Out Of Robosigning Litigation By Settling Case With Homeowner

In Tallahassee, Florida, Sunshine Slate reports:
  • In a split ruling likely to send shivers through the mortgage banking community, the Florida Supreme Court ruled Thursday that it will hear a case involving alleged “robo-signing” by a major mortgage lender even though parties in the individual case settled and asked that the case be dismissed.

  • In a 4-3 ruling, the state’s highest court said it will take up a case pitting a Palm Beach County homeowner against the Bank of New York Mellon even though the parties in July asked that the case be dropped.

  • The bank began foreclosure proceedings against homeowner Roman Pino, who filed a lawsuit contending that the bank had illegally back-dated documents in his case. In response, the bank dismissed its foreclosure proceeding. Pino’s lawyers contend the bank did so to avoid having to address the allegations of fraud.

  • The Fourth District Court of Appeal, ruled in favor of BNY Mellon’s motion to dismiss, but asked the state Supreme Court to review the case becausemany, many mortgage foreclosures appear tainted with suspect documents.”

  • In a group opinion, the majority on Thursday ruled that the issue was too important to allow it to be dropped, agreeing with the 4th DCA that the case, “may dramatically affect the mortgage foreclosure crisis in this State.”(1)

  • In dissent, Chief Justice Charles Canady said the court was overstepping its bounds by forcing them to continue their legal battle. “The parties to this proceeding have rights,” Canady wrote in a dissent joined by justices, Ricky Polston and Peggy Quince.

  • Justice Charles Canady wrote in a dissenting opinion. “They should not be dragooned into litigating a matter that is no longer in controversy between them simply because this Court determines that an issue needs to be decided.”

Source: Supremes: The “Robo-Signing” Show Must Go On.

See also, The Palm Beach Post: Florida Supreme Court will rule on Palm Beach County foreclosure case involving allegedly fraudulent bank documents.

For the ruling, see Pino v. Bank of New York, No. SC11-697 (December 8, 2011).

(1) In justifying proceeding forward with the case despite it having already settled, the majority expalined why it couldn't allow this case top escape their scrutiny, and then proceeded to cite Florida precedent for its authority to disregard the wishes of the parties to dismiss the case (bold text is my emphasis):

  • The issue we address is whether Florida Rule of Appellate Procedure 9.350 requires this Court to dismiss a case after we have accepted jurisdiction based on a question certified to be one of great public importance and after the petitioner has filed his initial brief on the merits.[1]

    This narrow question arose after the parties to this action filed a joint Stipulated Dismissal, which advised that they had settled this matter and stipulated to the dismissal of the review proceeding pending before this Court.

    It cannot be questioned that our well-established precedent authorizes this Court to exercise its discretion to deny the requested dismissal of a review proceeding, even where both parties to the action agree to the dismissal in light of an agreed-upon settlement.

    The question certified to us by the Fourth District Court of Appeal in this case transcends the individual parties to this action because it has the potential to impact the mortgage foreclosure crisis throughout this state and is one on which Florida's trial courts and litigants need guidance.

    The legal issue also has implications beyond mortgage foreclosure actions. Because we agree with the Fourth District that this issue is indeed one of great public importance and in need of resolution by this Court, we deny the parties' request to dismiss this proceeding.


  • The language of [Fla. R. App. P. 9.350(a)-(b)] does not impose upon the appellate court a mandatory obligation to dismiss a case following the filing of a notice of dismissal before a decision on the merits has been rendered.

    Rather, this Court has long recognized its discretion to retain jurisdiction over a matter and proceed with an appeal notwithstanding a litigant's timely filing of a notice of dismissal pursuant to rule 9.350, especially when the matter involves one of great public importance and is likely to recur. See Gregory v. Rice,
    727 So.2d 251, 252 n.1 (Fla. 1999) ("Mootness does not destroy this Court's jurisdiction when the questions raised are of great public importance or are likely to recur.").

    For example, in Holly v. Auld,
    450 So.2d 217 (Fla. 1984), this Court addressed the merits of a question certified to be of great public importance even after the respondent settled with the petitioners and the respondent's attorney filed a suggestion of mootness with this Court. Id. at 218 n.1. Notably, the respondent's attorney never filed a brief in opposition. Id. at 221 (Ehrlich, J., dissenting). Framing the issue as one of mootness, the Court stated that "[i]t [was] well settled that mootness does not destroy an appellate court's jurisdiction . . . when the questions raised are of great public importance or are likely to recur." Id. at 218 n.1 (majority opinion) (citing Pace v. King, 38 So.2d 823 (Fla. 1949); Tau Alpha Holding Corp. v. Bd. of Adjustments, 171 So. 819 (Fla. 1937)).

    Given that the district court properly certified its question as one of great public importance, and noting that the situation at issue would occur again, this Court retained jurisdiction and addressed the merits of the case despite the parties' settlement of the matter. Id.Similarly, in State v. Schopp,
    653 So.2d 1016 (Fla. 1995), this Court held that "[e]ven where a notice of voluntary dismissal is timely filed, a reviewing court has discretion to retain jurisdiction and proceed with the appeal." Id. at 1018.

    We expressly rejected the appellant's argument that since his rule 9.350(b) notice of voluntary dismissal was filed before the district court of appeal's decision became final, his appeal had to be dismissed as a matter of right. Id. Importantly, we noted this Court's power to retain jurisdiction where the case presents a question of public importance. Id.

    In yet another instance, this Court in Bell v. U.S.B. Acquisition Co.,
    734 So.2d 403 (Fla. 1999), ruled upon an issue of great public importance even after noting that the parties had settled their claims and filed a joint stipulation of dismissal in this Court. Id. at 405 n.1. Deciding the merits of the case notwithstanding the parties' settlement and joint stipulation of dismissal, this Court held: "As we have done in the past, we exercise our discretion to retain jurisdiction in this case because we consider this issue to be of great public importance." Id.; see also Enter. Leasing Co. v. Almon, 559 So.2d 214, 215 n.* (Fla. 1990) (retaining jurisdiction in order to resolve the conflict issue presented after the parties settled and stipulated to the dismissal of the case prior to the scheduled oral argument); Ervin v. Capital Weekly Post, Inc., 97 So.2d 464, 466 (Fla. 1957) (retaining jurisdiction to consider issue of public importance where appellees sought dismissal prior to initial decision).3

    In the present case, it is true that the parties have filed a notice of stipulated dismissal pursuant to rule 9.350 notifying this Court that this matter has been settled. Although the issues underlying this litigation may be moot as to the parties involved, our precedent clearly establishes that mootness does not defeat appellate jurisdiction, and a reviewing court has the discretion to retain jurisdiction over a case to decide the merits notwithstanding a notice of dismissal filed by the parties denoting a settlement of their dispute.

    At issue in this case is whether the plaintiff in a mortgage foreclosure action (here, BNY Mellon) may be subject to sanctions for filing what is alleged to be a fraudulent assignment of mortgage where the plaintiff filed a notice of voluntary dismissal before the trial court had the opportunity to rule on the motion for sanctions. As reflected above, the Fourth District certified this issue to be one of great public importance, and in doing so, noted that "many, many mortgage foreclosures appear tainted with suspect documents" and that Pino's requested remedy, if imposed, "may dramatically affect the mortgage foreclosure crisis in this State." Pino, 57 So. 3d at 954-55.

    The issue also has broader implications and presents questions outside of the mortgage-foreclosure context. Moreover, Pino, the petitioner to the instant review proceeding, has already filed his initial brief on the merits in this Court.Consistent with the rationale undergirding our prior precedent, we conclude that these circumstances fully support this Court's decision to exercise its discretion to retain jurisdiction over and decide the merits of this important case.

    To adopt the dissent's interpretation of rule 9.350(a)—that the act of the parties' stipulation for dismissal is binding on the Court—would require us to recede from our past decisions recognizing just the opposite. Instead, we adhere to our precedent and, accordingly, exercise our discretion to deny the parties leave to dismiss this review proceeding.

Foreclosure Rescue Scammer Convicted On State Charges Now Chased By Feds For Running Same Racket While Being Prosecuted In Earlier Case

In Northern California, The Modesto Bee reports:
  • Facing foreclosure, a Turlock homeowner two weeks ago signed over part interest in his property to a man who promised to save the family home.

  • The owner didn't want to talk about it Thursday in a brief telephone conversation. Chances are, he didn't know that his would-be savior was convicted of fraud only three weeks before the transaction while out of custody to await sentencing in state prison.

  • Now federal authorities are after Alan David Tikal, whose collaborators — including unidentified agents in Stanislaus County — preyed on at least 590 mortgage reduction victims with more than $201 million at stake, according to an affidavit released Thursday to The Bee.

  • "The scheme continued to operate while Tikal was incarcerated and after his release," Special Agent Joseph Camillucci says in the document. He works for President Barack Obama's Troubled Asset Relief Program and apparently continued to track Tikal's companies after his February arrest on a grand jury indictment from Alameda County.

  • Tikal's attorney in the state case, Fanya Young, could not be reached Thursday. Tikal and his KATN Trust appeared to have dealings with at least 20 families in Stanislaus County detected by The Bee through property records earlier this year. But he was charged only in Alameda County and remained in custody until pleading no contest on Halloween to two felony counts.

  • His plea deal would net a 16-month term in state prison; the prosecutor in that case has said a judge could impose a three-year, eight-month sentence if Tikal fails to appear at a sentencing scheduled for Dec. 21.

  • Previously based in Las Vegas, Tikal and his wife moved to Brentwood in Contra Costa County, where she and others continued the scheme, the affidavit says. Federal agents served search warrants Wednesday on their house, which doubles as an office, a TARP spokesman in Washington, D.C., said.

  • Federal authorities believe Tikal and his associates engage in mail and bank fraud — bread-and-butter offenses opening a door for federal prosecution.


  • A webinar observed by The Bee suggested Tikal relied on a "vapor money" theory, telling homeowners they could get out of traditional loans because the government backs banks with "vague promises" and not gold. He told customers he was a private banker with "access to enormous lines of credit in the banking industry."

For more, see Released mortgage fraudster re-offends (Turlock homeowner among his new victims).

Head Of Long Island Straw Buyer Racket Gets 4-12 Years; Scam Involved Use Of Forged Deeds, Unwitting Homeowners Victimized By Identity Theft

In Nassau County, New York, the Long Island Press reports:
  • A Westbury man has been sentenced to four to 12 years in prison for leading a $20 million scheme in what authorities described as the largest mortgage fraud and identity theft ring in Nassau County history.

  • James Robert Sweet pleaded guilty at Nassau County court in October to enterprise corruption, grand larceny, money laundering, identity theft, scheme to defraud, conspiracy and falsifying business records. The 44-year-old was also ordered to pay more than $1.2 million in restitution to lending institutions.

  • Prosecutors said Sweet and Dwayne Benjamin, 44, also of Westbury, led 15 schemers who committed more than 45 fraudulent acts by stealing millions in property and mortgages over six years. Benjamin also pleaded guilty in October to related charges and will be sentenced Thursday.

  • Sweet and Benjamin ran a typical mortgage fraud scheme in which they recruited so-called straw buyers to purchase a houses and secure mortgages, then kept the money, never made payments on the loan and let the home go into foreclosure. Straw buyers were paid about $10,000 for each purchase, according to investigators.

  • Like similar scams that have been uncovered in recent years, the scheme involved and array of corrupt professionals. In this case they included lawyers, mortgage brokers, real estate brokers, bank employees, an appraiser, a financial consultant and a U.S. Postal worker.

  • In one of the fraudulent deals, the scammers “purchased” the same house twice in two weeks by exploiting a delay in filing paperwork in the county clerk’s office, stealing $390,000 in each instance.

  • Prosecutors said they took the scam one step further when they submitted forged deeds to Nassau County in order to rent out some of the involved houses to tenants who qualified for subsidies before the properties were foreclosed—stealing more than $80,000 from taxpayers.

  • To execute the overall scam, those involved stole the identities of multiple homeowners and an attorney.

Source: Westbury Man Sentenced for $20M Mortgage Fraud.

Sunday, December 11, 2011

Recently-Released Transcripts Of Grand Jury Hearing Sheds Light In Nevada Robosigning Probe

In Las Vegas, Nevada, KSNV-TV MyNews Channel 3 reports:
  • The massive robo-signing scandal that throws into question tens of thousands of Las Vegas foreclosures is unfolding. Newly-released transcripts(1) from last month's Grand Jury hearing shed light on how the foreclosure fraud went down.

  • The transcripts include last month's testimonies from investigators, homeowners, temp workers and four notaries. The workers, who were employed at Lender Processing Services (LPS) under Gary Trafford and Geraldine Sheppard, admitted to forging signatures on tens of thousands of notices of default.

  • Most blamed fear of unemployment for their decision to forge signatures and break the law. One notary said she needed to keep her job while getting through graduate school, another said he had a family to support.

  • Trafford and Sheppard are accused of running the scam by advising their employees to forge signatures on notices of default between 2005 and 2008. Those documents got the ball rolling on many Las Vegas foreclosures.

  • Notary Tracy Lawrence struck a plea deal with the state's Attorney General's Office for one count of notary fraud. She admitted to notarizing about 25,000 false documents. Lawrence was found dead in her home the day of her sentencing hearing a few weeks ago.


  • Todd Grosz, a criminal investigator for the Nevada Attorney General’s office, said that out of tens of thousands of documents from LPS that his investigation of the fraud examined, an overwhelming majority seemed suspicious.

For more, see Massive foreclosure fraud's scope revealed by transcripts.

(1) For the transcripts, see:

Feds Indict Trio In Alleged South Florida Sale Leaseback Equity Stripping Racket

From the U.S. Department of Justice:
  • Lisa Wright, 46, and Cathy Saffer, 52, of Pompano Beach, Fla., were charged [] with a conspiracy to defraud homeowners and banks in a foreclosure rescue scheme, announced the Department of Justice. Also charged was Barrington Coombs, 57, a certified public accountant of Weston, Fla., who participated in the scheme.

  • A federal grand jury in the Southern District of Florida returned an indictment charging Wright and Saffer with one count of conspiracy, three counts of mail fraud and three counts of wire fraud. The grand jury charged Coombs with one count of conspiracy and one count of wire fraud.

  • The indictment states that Wright and Saffer operated an alleged business called Foreclosure Solution Specialists (FSS) from 2006 to 2009. Through FSS, Wright and Saffer allegedly targeted homeowners facing foreclosure, advertising that FSS could assist those homeowners in remaining in their homes.

  • According to the indictment, when contacted by distressed homeowners seeking assistance, Wright and Saffer misrepresented to those homeowners that their homes would be sold to investors. Wright and Saffer also allegedly claimed that customers could remain in their homes after the sales and promised them an opportunity to repurchase the homes at a later date.

  • According to the indictment, rather than selling the homes to legitimate investors, Wright and Saffer designed sham sales to straw purchasers whom they paid to participate in the scheme.


  • According to the indictment, these sham sales drew equity out of the homes, which Wright and Saffer pocketed for their own purposes. After doing so, Wright and Saffer allowed the loans to go into foreclosure. Homeowners ultimately lost all of the equity in their homes, and most of the victims were forced to move out of their homes.

For the Justice Department press release, see Three Charged with Fraud in Florida Foreclosure Rescue Scheme.

Housing/Civil Rights Lawsuit: Denial Of 'Affordable Housing' Condo Building Application Due To Town's 'No Blacks' Policy

In Darien, Connecticut, The New York Times reports:
  • DARIEN’S attitudes toward affordable housing are once again under scrutiny, this time in a federal civil rights action accusing the town’s planning and zoning commission, and its chairman, Frederick B. Conze, of trying to keep out black residents.

  • Christopher Hamer, a former Darien resident, filed the lawsuit last month, nearly two years after the commission denied his application to build condominiums, some below market rate, in a single-family neighborhood. The suit maintains that the commission’s denial was based on bias against housing that might attract blacks.

  • It accuses the commission of limiting opportunities for minorities to live in Darien by “keeping housing costs prohibitively high and preventing the construction of affordable housing units.”

  • Mr. Hamer’s accusations come as the federal Department of Justice continues investigating whether Darien violated the Fair Housing Act. When that inquiry began more than a year ago, federal authorities said they were specifically interested in a new provision in the zoning regulations that identified seven “priority populations” to be given preference for affordable housing.

  • Those populations largely consisted of people who already lived and/or worked in town, a policy that some fair-housing specialists said could be exclusionary given Darien’s small minority population. The planning and zoning commission has since repealed the “priority populations” provision.

  • To bolster its allegations of bias, Mr. Hamer’s suit cites public comments made by the commission’s chairman, Mr. Conze. One remark was taken from a 2008 hearing on another affordable housing application, in which Mr. Conze referred to such housing as “a virus” that needed to be contained.

  • The other is from his State of the Town Address last December, when, speaking of the trend toward development of high-density housing along transportation corridors, Mr. Conze warned, “The demographic and economic forces generated by our immediate neighbors to our east and west cannot be taken lightly,” adding that many people “view Darien as a housing opportunity regardless of its effect on the character of our town and existing home values.”

  • Darien’s neighbors to the east and west are the cities of Norwalk and Stamford. Mr. Hamer’s complaint contrasts the 0.5 percent of Darien’s population that is black with the roughly 22 percent in the bordering cities.

For more, see Housing Lawsuit Alleges Bias.

Elderly Widow Tricked Into Signing Over Deed To Home Dies As Legal Battle To Recover Title, Possession Of Premises Remains Unresolved

In New Port Richey, Florida, the St. Petersburg Times reports:
  • On the last day Eloise Mudway was alive, she still worried about being mistreated and alone. "You're not going to throw me out, are you?" the 94-year-old widow asked her caretaker, Jeff Kores, from her hospice bed. "No, honey," Kores said. "We love you. You're not going anywhere.""Oh, good," she said.

  • Mudway died Wednesday (Nov. 30, 2011), broke and still mired in a legal battle with the couple convicted of stealing her home and draining her bank accounts.

  • Joseph and Cynthia Clancy were arrested in 2005 on charges of tricking Mudway into signing over the deed to her Hilltop Drive home in New Port Richey. Mudway also told investigators the Clancys, then her live-in caregivers, stole her dead husband's diamond ring, fed her only bologna and pickle loaf sandwiches and made her do laundry for them.

  • "I stayed in my room most of the time," Mudway testified at the Clancys' trial in 2009. "I was not allowed to have company. It was like I was in prison."

  • Joseph Clancy, now 58, and Cynthia Clancy, 49, were convicted of grand theft of a person 65 or older and were sentenced to 10 years in prison.

  • A judge ordered the house be returned to Mudway, but the property is still tied up in a civil lawsuit winding its way through the court system. That prevented Mudway from living in the house or selling it to recoup some of her lost funds.(1) She spent her remaining years with Kores and his family on a $1,200 monthly Social Security check.

  • Until her death, she kept asking when they could move back into her old house. "The sad thing is that nothing is resolved," said Kores, who said his own home is in foreclosure because of thousands of dollars spent in legal bills he accumulated fighting for Mudway.

  • Even from prison, the Clancys have fought to keep the home they say Mudway willingly signed over to them.


  • Kores said he now has to get a probate attorney to represent Mudway's estate in the civil suit over her assets. He feels overwhelmed and sad and frustrated.

  • He's trying to gather enough money to get Mudway cremated. She wanted her ashes spread over her mother and stepfather's graves in St. Petersburg. He plans to abide by her wishes. "We were hoping it was over with when they went to prison," Kores said. "No way. ... They won. "She never saw a dime."

For more, see Pasco woman dies, but fight over her home goes on.

(1) One may wonder why the homeowner/victim of this ripoff couldn't recover title and possession of her home shortly after the successful completion of the criminal prosecution of the scammers. After all, if the ripoff of the title to the homeowner's residence was perpetrated as a result of an act that is determined to be a crime, it is at least arguable that any contract or real estate conveyance founded upon such act is absolutely void. The case law, at least in the State of Florida, appears to support this view, as the Florida Supreme Court appears to make pretty clear in one case. See:

  • Town of Boca Raton v. Raulerson, 146 So. 576, 577 (Fla. 1933):

    where a statute pronounces a penalty for an act, a contract founded upon such act is void, although the statute does not pronounce it void or expressly prohibit it."

See also:

Chen v. Whitney National Bank, 65 So. 3d 1170 (Fla. App. 1st DCA, July 22, 2011) ([alteration added] - not in the original text):

  • [T]he Florida Supreme Court has expressed that "where a statute pronounces a penalty for an act, a contract founded upon such act is void, although the statute does not pronounce it void or expressly prohibit it." Town of Boca Raton v. Raulerson, 146 So. 576, 577 (Fla. 1933).

Hooten v. Lake County, 177 So. 2d 696 (Fla. App. 2nd DCA, 1965):

  • As we have indicated, the supreme court in the Town of Boca Raton case approved the principle that where a statute pronounces a penalty for an act, a contract founded on such act is void, although the statute does not pronounce it void nor expressly prohibit it.

Jaylene, Inc. v. Steuer, 22 So. 3d 711 (Fla. App. 2nd DCA, 2009) (Northcutt, J. concurring):

  • One well-established defense to the enforcement of a contract is that the contract violates public policy. See E. Allan Farnsworth, Unenforceability on Grounds of Public Policy, in Contracts ch. 5 (2d ed. 1990).

    This defense is firmly rooted in common law, and because it protects the interests of society at large as well as—and sometimes contrary to—those of the contracting parties, it is an important aspect of the courts' authority. As far back as 1775, Lord Mansfield was expressing the view that an agreement may be void on grounds of public policy, stating: "No court will lend its aid to a man who founds his cause of action upon an immoral or an illegal act." Id. § 5.1 at 347 (quoting Holman v. Johnson
    , 1 Cowp. 341, 343, 98 Eng. Rep. 1120, 1121 (1775)).

    An early Florida case recognized this defense to contract enforcement, citing the principle "ex turpi causa non oritur actio" to explain the law's reluctance to enforce contracts in violation of public policy. Town of Boca Raton v. Raulerson
    , 146 So. 576, 577 (Fla. 1933). Translated, the maxim means "`from an immoral consideration an action does not arise,'" which "expresses the principle that a party does not have a right to enforce performance of an agreement founded on a consideration that is contrary to the public interest." Black's Law Dictionary 607 (7th ed. 1999).

POA-Holding Woman Said To Have Known Or Wilfully Closed Eyes To Dementia-Suffering Senior's Capacity In Misusing Loot From $2.25M Sale Of Property

In Brisbane, Australia, The Courier Mail reports:
  • A LOGAN City Council councillor has admitted she knew a dementia patient did not have the legal capacity to know what was happening when she transferred a "vast amount" of money out of their joint account into her own.

  • However, Hanjal Black said that, although she made the admission, she was carrying out the long held wishes of the 66-year-old man in a manner he had made it clear for a decade he wanted her to act.

  • In the Supreme Court in Brisbane, the Public Trustee of Queensland had asked for a summary judgment declaring the money should have been held on trust by Mrs Black for the elderly man because he lacked capacity to administer it.

  • Mrs Black had power of attorney for the man from April 2009 but it has since been suspended. The court heard in a legal document in which admissions were made, Mrs Black admitted she knew the man lacked necessary capacity at the time of the transfer of money on October 28, 2009.

  • David Jackson, QC, for the trustee, submitted that because of Mrs Black's admission and the manner in which she acted the trustee should get the summary declaration. The trustee believed Mrs Black knew or wilfully closed her eyes to the capacity of the man at the time of the transaction.

  • Mrs Black, who represented herself after her previous lawyers withdrew, argued there were issues which should be determined by a full hearing of evidence and cross-examination.

  • The Public Trustee has alleged Mrs Black misused funds from the $2.25 million sale of the man's property at Park Ridge. She has also lodged a civil matter counter-claim against the Public Trustee, seeking the man's home at Greenbank be signed over to her.

  • It is alleged Mrs Black and the elderly man established a joint bank account where the money was eventually placed, and it is also alleged she then transferred most of it into her own account.

  • In the Supreme Court [], Mr Jackson said the Public Trustee argued the transfer of the money had been a "conflict transaction". He said the trustee was not saying the man lacked capacity when giving power of attorney in April 2009, but rather it was about the man's capacity at October 2009 when the transaction was made.

  • Mrs Black told the court she had been like a daughter to the man and her family was the only family he had. She said she had acted in a manner which the man had made clear he wished her to undertake over a decade.

For more, see Hajnal Black admits elderly friend did not fully understand transfer of $1.5m into her account.