Lawyers in multiple states face inquiry, or worse, over legal fees in mortgage foreclosure matters
Attorneys in multiple states are in the news due to alleged violation of rules concerning the fees they charged clients seeking mortgage modifications or concerns that they may have used questionable billing practices while representing lenders in foreclosure cases.
In California, attorney Stephen Siringoringo was ordered by the State Bar Court to stop practicing law after accepting up-front payments from mortgage modification clients, the Press-Enterprise reports.
A state law has banned such fees since 2009, the newspaper notes. It could not reach Siringoringo for comment.
Another law firm in Florida is being sued on a similar basis by the state attorney general.
Attorney Eric Mader of Tampa, the Mader Law Group and another individual are accused of charging up-front fees in national foreclosure-rescue operations, providing misleading information to clients and charging for services that weren’t rendered in a complaint (PDF) filed by Florida Attorney General Pam Bondi.
The Palm Beach Post (sub. req.) and Southwest Florida Online have stories, and a press release from the AG’s office provides further details.
In Colorado, the state attorney general’s office is investigating a half-dozen law firms over concerns that they are charging unreasonable markups on fees associated with mortgage foreclosure cases while representing lenders, the Denver Post reports.
Although it is client lenders, in theory, who suffer from markups, such fees are often paid by defendant homeowners or, if they have no equity, by investors purchasing the property at auction.
Another Denver Post article describes the charges at issue, and the Denver Post reports that a former associate at one law firm who has voluntarily provided information to the AG’s office says it charged an hourly rate when a lender was not paying the bill but a flat fee when a lender was paying the bill.
See also:
ABAJournal.com: “Colorado foreclosure lawyer must turn over documents in bill-padding probe”
ABAJournal.com: “Attorney-client privilege prevents associate from aiding AG’s law firm billing probe, partner argues”
