Florida Bar re emphasizes lawyer's duty to report fraud in foreclosure casese

From Naked Capitalism

Florida, which has been Ground Zero of the foreclosure crisis as well as a hotbed of judicial abuses, ranging from the biggest and most active foreclosure mills to kangaroo courts known as “rocket dockets”, has taken a surprising step in the right direction. The state bar association has told foreclosure lawyers in no uncertain terms that they have a duty to report fraud to the court, and that supersedes their responsibilities to clients. And even more surprising, the duty is retroactive: lawyers are supposed to inform judges even if the home has already been sold!

This move will have the very salutary effect, if the new order were actually followed, of having judges know the extent of servicer abuses. And the side effect would be even greater skepticism on the behalf of judges (well at least those judges not bought and paid for by the banking industry). Even if lawyers complied in only, say, one-quarter of the abuses, the effect on servicer credibility, which has already taken a big hit, would be considerable.

Florida, which has been Ground Zero of the foreclosure crisis as well as a hotbed of judicial abuses, ranging from the biggest and most active foreclosure mills to kangaroo courts known as “rocket dockets”, has taken a surprising step in the right direction. The state bar association has told foreclosure lawyers in no uncertain terms that they have a duty to report fraud to the court, and that supersedes their responsibilities to clients. And even more surprising, the duty is retroactive: lawyers are supposed to inform judges even if the home has already been sold!

This move will have the very salutary effect, if the new order were actually followed, of having judges know the extent of servicer abuses. And the side effect would be even greater skepticism on the behalf of judges (well at least those judges not bought and paid for by the banking industry). Even if lawyers complied in only, say, one-quarter of the abuses, the effect on servicer credibility, which has already taken a big hit, would be considerable.

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