Back in September 2010, we bestowed Lawyer of the Day honors upon David J. Stern, aka Florida’s “Foreclosure King.” We noted Stern’s rise into the ranks of self-made millionaires, despite not having attended some fancy first-tier law school. (Stern graduated from the South Texas College of Law, a fourth-tier school.)
We marveled at Stern’s wealth: a $14 million mansion here, a $7 million condo there, Ferraris and Porsches galore, and a 130-foot, $20 million yacht. We noted that Stern, thanks to the success of his booming foreclosure-law practice, was “running financial circles around all those Stanford and NYU law grads who wound up as Biglaw partners.”
Alas, in the past few months, David Stern’s fortunes have taken a turn for the worse….
About a month after our Lawyer of the Day post, we noted that Stern was under investigation and conducting layoffs. There were claims of problems with documents generated by Stern’s firm, including allegations of falsified paperwork and violations of state and federal law.
Alas, it seems that the investigations have taken their toll. Reports Reuters:
A prominent Florida lawyer accused of mishandling many foreclosure cases in that state is shutting down his foreclosure law practice at the end of the month, a regulatory filing shows.
The decision by the lawyer, David Stern, was announced by DJSP Enterprises Inc, a company he once ran and which calls itself the main customer of the Law Offices of David J. Stern PA.
DJSP said it expects to receive no further referrals from Stern. The company, whose businesses have included processing, servicing and title operations, has already laid off much of its workforce.
There’s a more detailed account over at the Orlando Sentinel, which notes the rapid fall of Stern’s enterprises:
[Stern’s] law firm and DJSP once had more than 1,200 employees, before the Florida Attorney General’s Office announced in August that it was investigating the way the two businesses handled foreclosure paperwork. Stern’s law firm handled tens of thousands of foreclosure cases around the state – about 20 percent of all repossessions in Florida.
The law firm’s major customers, including mortgage giants Fannie Mae and Freddie Mac, began pulling their cases from the firm last fall. Then DJSP began shedding employees by the hundreds, until there were roughly only 50 remaining last month.
The troubles at DJSP may even be affecting Stern’s personal finances. According to Reuters, he has put several luxury assets, including real estate and a yacht, up for sale.
We suspect that Stern has put enough money away, whether in other investments on in offshore bank accounts, to survive the closing of his businesses. But in the unlikely event that some bank tries to foreclose on one of his many multimillion-dollar homes, he won’t have to look far for foreclosure expertise. ROBO-SIGNING SECURE.
David Stern foreclosure firm closing at end of month [Orlando Sentinel via ABA Journal]
Florida lawyer David Stern ends foreclosure law practice [Reuters]