State rips job quality of two fired foreclosure fraud investigators

Article Courtesy of The Palm Beach Post

By Kimberly Miller

Published July 24, 2011

The Florida Attorney General's Office released a cutting statement Thursday criticizing the work of two former state foreclosure fraud investigators after a week of national attention paid to the duo's forced resignations.

Carlos Muniz, deputy attorney general and chief of staff in Attorney General Pam Bondi's office, said the performance of former Assistant Attorneys General Theresa Edwards and June Clarkson was "unacceptable" and that they were given the option to resign or be fired because of their "failure to improve after multiple warnings."

The Palm Beach Post first reported their departure on July 13.

Edwards and Clarkson, who resigned their jobs at the South Florida bureau of the office's Economic Crimes Section on May 20, had been investigating the state's so-called "foreclosure mills," uncovering evidence of legal malpractice that also implicated banks and loan servicers.

In his statement Thursday, Muniz refers to an April 28 review of the South Florida bureau and Chief Assistant Attorney General Robert Julian that lists staff shortcomings, including "proper identification and analysis of legal issues" and "professionalism to opposing counsel."

"Hopefully improvement will be made in these areas in the future," the review concluded.

It does not mention Edwards or Clarkson by name.

Just seven days earlier, in an interim evaluation of Edwards, Julian praised her work, saying it has been "instrumental in triggering a nationwide review" of foreclosure practices.

"I cannot overstate the degree to which I respect Ms. Edwards and her work with this unit," Julian wrote.

Edwards said Julian was assigned to another position in Fort Lauderdale in June.

Both Edwards and Clarkson also received high marks in evaluations conducted in the fall.

Clarkson was given "above expectation" or "exceptional" rankings in 14 of 15 categories.

Edwards received "above expectation" or "exceptional" rankings in all 15 categories.

"The shortcomings outlined are hard to understand when you put them beside the evaluations of 2010," Edwards said Thursday. "I dispute the version of events released by the attorney general's office."

Edwards said she and Clarkson asked why they were being asked to resign or be fired at the abruptly called 3:30 p.m. meeting that ended with them handing in nearly identical resignation letters. She said her supervisor, Julian, said he was told earlier in the day that the women would be done at the end of the day. The news came as a complete surprise to the women, she said.

"When we asked why, (Julian) said there was no reason given," Edwards said. "He said he asked and none was given."

Last year, Edwards and Clarkson created a 98-page Power Point presentation titled Unfair, Deceptive and Unconscionable Acts in Foreclosure Cases, which outlines instances of questionable signatures and notarizations, as well foreclosures filed by entities that may not have had the legal authority to foreclose.

The report was heralded by homeowner supporters for its detail and used this month by a New York judge in a foreclosure ruling that went against the bank.

The foreclosure investigations were launched under former Attorney General Bill McCollum, but Edwards said she sensed changes were coming under Gov. Rick Scott and Bondi.

The investigations have faced setbacks. The Boca Raton-based law firm of Shapiro & Fishman won a ruling in the 4th District Court of Appeal in April to quash a subpoena it was issued last year. The state is not challenging the decision. A similar subpoena to the Law Offices of David J. Stern was upheld in Broward County Circuit Court, but has been appealed to the 4th District Court of Appeal.

Muniz said Thursday the resignations had nothing to do with politics.

"The attorneys have baselessly suggested that they were the victims of 'politics' and that our agency is uninterested in pursuing foreclosure-related wrongdoing," Muniz said. "Their reaction is unfortunate because nothing could be further from the truth."

Included with his statement was an information sheet on the state's foreclosure investigations. It says staffing for the investigations has more than doubled and that in the past three months 14 employees have dedicated more than 1,500 hours of time to the investigations.

It also lists 10 companies under state scrutiny, including Shapiro & Fishman and the Law Offices of David J. Stern.

It was Edwards and Clarkson who obtained sworn statements from former Stern employees in which they described office conditions where signatures where regularly forged, paperwork was notarized by non-notaries, and flawed files were hidden from auditors.

"It seems strange," Edwards said, "that they would remove the two attorneys who knew the most about the background and had gotten the farthest in the investigations without any opportunity to provide transition notes."

Attorney general's ouster of 2 top investigators raises troubling questions