The Florida Supreme Court suspended Miami real estate attorney Terry Rosenberg Jan. 7 as a result of a lawsuit against him by the Florida Bar. The suspension prompted lawmakers to quickly draft a bill to protect homeowners from “foreclosure vultures,” Daily Business Review reported Friday.
Broward County Circuit Judge Robert Rosenberg issued a scathing order and sanctions in December against Rosenberg in a foreclosure case in Judge Rosenberg’s court, according to Daily Business Review.
The Florida Bar accused lawyer Rosenberg of engaging in a scheme to defraud as many as 300 Floridians whose homes were foreclosed, Daily Business Review reported. Miami lien company Global Heir and Assets and its principals Manuel Rosado Sr. and Manuel Rosado Jr., and two out-of-state banks were also said to have participated in the alleged scheme.
Rosenberg and his associates allegedly identified foreclosure cases that had surplus funds, collected them supposedly on behalf of the former homeowners but without their knowledge and took up to 40 percent of the surplus funds as payment, media reports said.
The Bar contends that Rosado Jr., acting with bank employees, cashed checks made out to the ex-owners without the ex-owners’ endorsements. In total, the Bar said, Rosenberg “illegally collected $151,634 from 18 victims and none of the victims received any funds.” The petition seeking Rosenberg’s emergency suspension said, however, that the Bar is investigating dozens of other victims of “the respondent’s machinations,” Daily Business Review reported.
“We’ve seen other cases but nothing this bad,” Barnaby Lee Min told Daily Business Review. “It’s a strong possibility we will ask the Supreme Court to disbar Mr. Rosenberg.”
Terry Rosenberg, a 30-year real estate law veteran, is vigorously fighting the charges, Daily Business Review said. His attorney blames Rosado Jr. for the wrongdoing, and accuses the Bar of overzealousness in its investigation, according to media reports.
State Rep. Ira Abraham Porth, D-Coral Springs, Fla., and Sen. Walter “Skip” Campbell, D-Tamarac, Fla., sponsors of the foreclosure bill, told Daily Business Review the Rosenberg case has exposed a loophole in the law that is allowing businesses and attorneys to prey upon people in financial straits. Possible remedies include setting up a hotline to educate people facing foreclosure about the possibility of surplus funds and the fact that they don’t need an attorney to collect them. Another possibility is capping attorney fees in surplus fund recoveries.
“These lawyers and companies have popped up in recent years, and they’re known around the courthouse as foreclosure vultures,” Porth told Daily Business Review. “There are cases of attorneys taking 38 percent of $48,000 for attending what amounts to a 10-minute hearing. In reality, people don’t even need an attorney to obtain these funds.”
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