Steve Dibert, MFI-Miami
I often get asked of what I think about the foreclosure “activist” movement that has sprung up in recent years. I have to constantly warn people to be careful because although most of them have a “.org” domain, it does not mean they are really a non-profit. Many of these foreclosure activists aren’t activists at all but profiteers who want to capitalize on the housing crisis. In full disclosure, MFI-Miami does own several .org domains. However, this is done to protect the name of this company from imitators.
Moe Bedard, the former “owner” of the illegally ran Loansafe Solutions is a perfect example. He has two websites, www.loansafe.org and www.loanworkout.org both give the impression Moe is helping homeowners and claims he’s “paying it forward” but in reality, this habitual drug trafficker and convicted felon who ran an unlicensed modification company is actually using these sites to profit from the advertising and by selling the names and emails of the people coming to the site for help to real estate investors who want to pick up real estate for pennies on the dollar. He even bragged about his business model on the website Wicked Fire in May of 2007 soon after leaving prison:
“Interesting thought tho – bear with me – created a website aka loansafe – bring folks there that are losing their homes/loan mods/ ect – make it a public forum – pay it forward – help your neighbor – screw you sister – ect -hence – investors will pay huge finders fees – i just had a brain fart ya know –“
“Thanks Ajay! I dont know about down under but here in the states the RE market is taking a dive. So what does a smart marketer do? Monetize people who need my help. The market is headed south so whats the next big thing? Foreclosures and Bankruptcy’s so get your shit ready for the US revolution and monetize the poor saps who bought a house they cant afford with loans they should never of been in.”
He later writes:
Moe made headlines two and half years ago when he posted an email a home owner sent him from Angelo Mozilo, the former head of Countrywide that basically called the homeowner a deadbeat. Moe then chastised Mozilo in the blogosphere. Well, it appears Moe has the same utter contempt for homeowners as Angelo Mozilo. Here are a couple of emails Moe has sent homeowners who were active bloggers on his site and dedicated themselves to sharing information:
Get a life woman. We all get what we deserve in life and it looks like you have got exactly what you have deserved throughout yours. Good luck, you need it!
From: Moe Bedard <email@example.com>
Date: Sunday, April 25, 2010, 7:00 PM
LOL…. Pathetic, old, lonely woman, that IS your mirror. Go f*** Your STUPID Dr. self!
www.4closurefraud.org in Florida is another site that portrays itself as a charitable organization and actually goes as far as to soliciting donations on multiple spots on its front page:When you press the Paypal Donate button, this Paypal page pops up:
This site however is actually a marketing tool for the Save My Home Law Group ran by Attorney Carol Asbury. Michael Redman, who claims to be the founder of the site is actually a former Toyota car salesman and is not the owner. The site is clearly used to promote Ms. Asbury’s law firm and her political agenda.
Although the ICANN registry says the owner is Domains By Proxy, the site has been listed on Carol Asbury’s business cards prior to Mr. Redman’s involvement and is listed as her website with the Florida Bar. Carol Asbury, who is a protégé of Neil Garfield, met Michael Redman at one of Garfield’s seminars and offered him a job as a researcher.
As a former Assistant Attorney General, Carol Asbury should know soliciting donations without being a licensed non-profit in the state of Florida is illegal.
Florida Statute 496.404 clear defines what a charitable organization and what a “Donation” is:
(1)“Charitable organization” means any person who is or holds herself or himself out to be established for any benevolent, educational, philanthropic, humane, scientific, artistic, patriotic, social welfare or advocacy, public health, environmental conservation, civic, or other eleemosynary purpose, or any person who in any manner employs a charitable appeal as the basis for any solicitation or an appeal that suggests that there is a charitable purpose to any solicitation.
(2)“Charitable purpose” means any benevolent, philanthropic, patriotic, educational, humane, scientific, artistic, public health, social welfare or advocacy, environmental conservation, civic, or other eleemosynary objective.
(5)“Contribution” means the promise, pledge, or grant of any money or property, financial assistance, or any other thing of value in response to a solicitation.
Florida Statute 496.405 clearly states you must be registered with the state to solicit donations and you barred from doing so until approval is granted.
(1)(a)A charitable organization or sponsor, unless exempted pursuant to s. 496.406, which intends to solicit contributions in this state by any means or have funds solicited on its behalf by any other person, charitable organization, sponsor, commercial co-venturer, or professional solicitor, or that participates in a charitable sales promotion or sponsor sales promotion, must, prior to engaging in any of these activities, file an initial registration statement, and a renewal statement annually thereafter, with the department.
Florida Statute 496.415 clearly states that this is not permissible:
It is unlawful for any person in connection with the planning, conduct, or execution of any solicitation or charitable or sponsor sales promotion to:
(1)Operate in violation of, or fail to comply with, the requirements of ss. 496.401-496.424.
(4)Represent that the contribution is for or on behalf of a charitable organization or sponsor or to use any emblem, device, or printed matter belonging to or associated with a charitable organization or sponsor, without first being authorized in writing to do so by the charitable organization or sponsor.
(7)Misrepresent or mislead anyone by any manner, means, practice, or device whatsoever to believe that the person or organization on whose behalf the solicitation or sale is being conducted is a charitable organization or sponsor, or that any of the proceeds of the solicitation or sale will be used for charitable or sponsor purposes, if that is not the fact.
Florida Statute 496.416 and Florida Statute 496.417 clearly state these acts would be considered deceptive and does allow for the court to criminally prosecute.
Florida Statute 496.416
Any person who commits an act or practice that violates any provision of ss. 496.401-496.424 commits an unfair or deceptive act or practice or unfair method of competition in violation of chapter 501, part II, and is subject to the penalties and remedies provided for such violation.
Florida Statute 496.417
Except as otherwise provided in ss. 496.401-496.424, and in addition to any administrative or civil penalties, any person who willfully and knowingly violates ss. 496.401-496.424 commits a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084. For a second or subsequent conviction, such violation constitutes a felony of the second degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
On top of this, Asbury’s firm charges a non-refundable retainer of $10,000 and up to a 45% contingency fee:
- In consideration of the above services rendered and to be rendered by the Attorney, Client hereby agrees to pay to the Attorney a fee for professional services rendered as follows:
A FIXED NON-REFUNDABLE FEE OF $10,100 TO BE PAID OUT OVER A 24 MONTH PERIOD AS FOLLOWS: $500.00 UPON SIGNING THIS RETAINTER AGREEMENT AND $400.00 PER MONTH FOR 24 MONTHS plus the contingency fee set forth below.
The fixed rate fee, which is part of this agreement, is non-refundable and is not contingent on the outcome of any legal matter, legal counsel, or legal representation. The monthly fixed rate fee of $400.00 shall be received by Attorney each and every month on the 1st day of the month corresponding to the execution of this Fee Agreement. Attorney may withdraw from further representation if the Client fails to make a timely payment of the agreed fixed rate fee.
Contingency Fee: In addition to the fixed non-refundable fee, the Attorney shall receive, for the legal services to be provided, under this agreement the following:
25% of the net recovery if the recovery is obtained before the filing of a lawsuit
34% of the net recovery after the filing of a law suit
45% of the net recovery if the Bank/Lender files an appeal from a court judgment, where the Attorney must file a Client Answer Brief and defend the Respondent Client
Net recovery means the amount remaining after the total amount received (whether by settlement, arbitration award, court judgment, total amount of any reduction in the mortgage note, or total amount of the Note should the Note and mortgage be eliminated) has been reduced by the sum of all “costs,” as defined in this agreement. The thirty-four percent (34%) is based on the face value of the mortgage note less any reduction (principal reduction) in that value received as part of any settlement or court judgment or arbitration award, plus any award of damages, whether compensatory, actual, punitive or otherwise. For example, if a $300,000 Note is reduced to $200,000, then the attorney fee is 34% of $100,000 plus 34% of any compensatory, punitive or actual damages. But if the $300,000 mortgage is totally rescinded, then the attorney fee is 34% of $300,000 plus 34% of any award of compensatory, punitive or actual damages. A reduction or rescission of the Mortgage Note is considered a lump-sum payment.
This means on a $100,000 settlement, she is collecting $35,000 in attorney fees without even stepping into a court room and $44,100 if she files a case.
These fees even without the contingency fees are still extremely high considering the going rate for foreclosure defense in Florida is under $5000.
4closurefraud like most activist websites has a tendency to pass along bad information due either to Captain Ahab style revenge fantasies against banks by its contributors or delusions of wanting being a superhero. Both seem to alternate on any given day. Take this and couple it with their Weekly World News style information gathering and you have a dangerous combination which has the potential of being costly not only to a homeowner but to other attorneys who have been successful in bringing banks to the table for homeowners.
In May, upset that Judge Meenu Sasser in Palm Beach County was consistently ruling against her and other foreclosure defense attorneys in their circle, Asbury and Redman did a Glenn Beck style stunt and posted the contents of Judge Sasser’s mutual fund on their site containing stock holdings in several major banks and several weeks later tried to assert Judge Sasser unfairly ruled against foreclosure defense attorneys because doing so would enhance the value of her mutual fund. Soon after posting this, they followed it up with another article claiming every judge in Palm Beach County is corrupt because the county’s pension fund has funds tied to the major banks.
NEWSFLASH! The majority of pension funds, IRAs and mutual funds have investments tied directly or indirectly to banks. Even now Banks are considered a solid long term investment. As they have been for 60 years.
Continuing in their Glenn Beck style campaign, Redman continually posts Chicken Little “calls to action” based on rumors or bad information. Several weeks ago, he decided to play constitutional scholar and proclaimed President Obama’s pocket veto of the Interstate Recognition of Notarizations Act of 2010 was unconstitutional because Harry Reid had not adjourned the US Senate. I don’t know if he got this information from piecing together sugar packets and kid’s menus from Denny’s but the posting got a lot of people worked up into a pretty big frenzy over what was inaccurate information.
Reality doesn’t seem to faze Asbury or Redman because articles based on hysterics like those mentioned above easily play to their audience that is ignorant to the ways of mortgage financing and banking. Their emotions are running high and are easily susceptible to manipulation. This makes it easy to get cash strapped clients to shell out what little money they have left.
The reality is there is no mass conspiracy between the Florida judicial system and the banks. The Banking Boogey Man is not hiding under the bed or lurking in the closet. Activist attorneys argue these theories that sound like they came from the nether regions of Glennbeckistan on their blogs because they can’t compete with the attorneys who are forcing lenders and the banks to the table.
Foreclosure Activists will say, “What’s the difference between what they do and what you do?”
The big difference is I don’t pretend to be a non-profit. I am a For-Profit Enterprise and I make no excuses for it nor do I attempt to paint myself as something I’m not. My clients pay me for a service that is based on over a decade of experience in lending. My fees and the fees of the attorneys I have the pleasure to work charge 1/10 of what Ms. Asbury charges.
Here’s another huge difference. The only experience most foreclosure advocates have is a 5 hour Neil Garfield seminar and now through the magic of their own ego believe they are an expert in finance and constitutional law. I am an expert because I worked in the system for 10 years prior to forming MFI-Miami. I know how the system works because I lived it. I also have access to better and more reliable sources like former Wells Fargo and Countrywide underwriters and managers I can call as experts. It is highly unlikely any “advocates” has ever read Dune by Frank Herbert. There is a quote from Paul Atreides in it that most foreclosure advocate need to remember:
“A process cannot be understood by stopping it. Understanding must move with the flow of the process, must join it and flow with it.”
This is a huge reason why my clients and the attorneys I work with are bringing lenders to the table to negotiate settlements that are beneficial to our clients. We aren’t succumbing to histrionics and writing post after post crying about rocket docket judges, judicial conspiracies or screaming about the foreclosure crisis being a constitutional crisis because we worked in the system and understand how it works which is why my clients are successful. We listen to people like Ira Rheingold, Director of the National Association of Consumer Advocates when he responded to the news about notary seals; “Just because you get a lawful notarization of a bunch of lies doesn’t change your ability to challenge an affidavit as a bunch of lies.”