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Judge sides with Portland lawyer in ‘robo-signing’ appeal


pressherald.com | January 19, 2015

By Brena Swanson

A Maine Supreme Judicial Court justice has ordered the withdrawal of a public reprimand of a Portland lawyer in a high-profile mortgage foreclosure scandal involving a practice called “robo-signing.”

The Board of Overseers of the Bar issued the reprimand last April after concluding that lawyer Paul E. Peck continued with several foreclosure cases after a GMAC Mortgage official admitted that he had not reviewed mortgage documents, didn’t have personal knowledge of the facts asserted and had not signed and swore to the truth of the foreclosure documents in front of a notary public.

The case became known nationally as the “robo-signing” scandal after mortgage company officials admitted that hundreds of foreclosure documents had been signed without a thorough review of the cases, as required by law.

Peck, who appealed the bar reprimand in May, was a Drummond & Drummond lawyer working for GMAC in 2010 when the financing company was pursuing dozens of foreclosures in Maine. In most of the cases, GMAC was seeking summary judgments in the cases, based on affidavits by a GMAC “limited signing officer” in Pennsylvania, Jeffrey Stephan.

But in a deposition, Stephan admitted that he didn’t review all the documentation in the foreclosure files, and only checked figures related to the payments made and amounts due on the mortgages. Stephan also said that he never signed and swore to the accuracy of the affidavits in front of a notary.

The board said that called into question all the foreclosure actions that Stephan had worked on.

According the bar board, Peck didn’t believe that Stephan’s testimony was true and assumed it would be changed in an “errata” – or errors – sheet that is sometimes attached to depositions. However, the board said that those sheets are normally used to correct minor errors, not substantial portions of testimony.

In its findings, the bar said “it is not logical that an experienced attorney would consider that such material statements of a deposition witness would actually be substantially changed in an ‘errata’ sheet.”

Drummond & Drummond sent letters to the courts where foreclosure cases based on Stephan’s affidavits were being handled, pointing out the problems with the affidavits. But in the meantime, the firm had won summary judgments for GMAC in six cases and new motions for summary judgments were filed in seven other cases, using Stephan’s flawed affidavits, the bar found.

But in his ruling Thursday, Justice Andrew M. Mead of the Maine supreme court ruled that the bar panel relied on a standard that Peck should have known – rather than had actual knowledge – that Stephan’s deposition testimony was not going to be changed.

The applicable section of bar rules “are clearly predicated on conscious malfeasance, not negligence or recklessness,” Mead wrote. “The panel does not conclude, nor does the record support the notion, that Peck knowingly undertook any course of conduct intended to foist false statements of fact upon the court in the form of the Stephan affidavits.”

Mead said that Peck believed that Stephan’s deposition would be corrected, but told members of the firm to put affected cases on hold until the matter was resolved. When it became clear that Stephan’s testimony would not be changed, Mead said, Drummond & Drummond “earnestly undertook” to notify the courts of the problems with the affidavits.

Attempts to reach Peck for comment Saturday were not successful.


Back to January 2015 Archive

CFLA was founded by the Nation's Leading Foreclosure Defense Attorneys back in 2007 to serve the Foreclosure Defense Industry and fight pervasive Bank Fraud. Since opening our virtual doors, CFLA has rapidly expanded to become the premier online legal destination for small businesses and consumers. But as the company continues to grow, we're careful to hold true to our original vision. For us, putting the law within reach of millions of people is more than just a novel idea—it's the founding principle, just ask Andrew P. Lehman, J.D.. With convenient locations in Houston and Los Angeles, you can contact Our National Account Specialist and General Manager / Member Damion W. Emholtz at 888-758-2352 for a free Mortgage Fraud Analysis or to obtain samples of work product, including cutting edge Bloomberg Securitization Audits, Litigation Support, Quiet Title Packages, and for more information about our Nationally Accredited and U.S. Department of Education Approved "Mortgage Securitization Analyst Training Certification" Classes (3 days) 24 hours for approved CLE & MCLE Credit (Now Available Online).

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