Many creditors and debt buyers have faced scrutiny over so-called “robo-signing” of affidavits in debt collection lawsuits. Affidavit review procedures employed by ARM industry members have undergone significant enhancements due to FDCPA class action lawsuits over supposed lax policies in having clerks sign hundred of affidavits per day. The economic meltdown of 2008 and resulting wave of foreclosure actions created a media frenzy that led to the coining of the phrase “robo-signing.” Lawyers representing creditors have also faced sanctions for participating in “robo-signing” type filings. One case involving a foreclosure attorney recently reached Maryland’s highest court.
On August 20, 2013, the Maryland Court of Appeals ordered Thomas P. Dore of Towson, Maryland to serve a ninety (90) day suspension from the practice of law for directing law firm employees to sign Mr. Dore’s name to foreclosure papers filed with the Court and for directing notaries employed by the firm to verify the signature as his own.
The Court’s lengthy 45 page opinion1 found that Mr. Dore violated Maryland Rules of Professional Conduct provisions prohibiting lawyers from making false statements of fact or law to a tribunal or failing to correct false statements previously made. The Court also determined that Mr. Dore failed to properly supervise non-lawyer employees in a manner consistent with the Rules of Professional Conduct and engaged in misconduct prejudicial to the administration of justice.
The Court’s opinion emphasized Mr. Dore’s 25 years of practice and his heretofore unblemished record. The Court also acknowledged Mr. Dore’s cooperation in the disciplinary process which began when a Maryland Circuit Court Judge warned Mr. Dore in April, 2010 that the practice of using “false notaries” was improper. Mr. Dore immediately stopped the practice, hired his own ethics counsel, and self reported his conduct to Maryland’s Attorney Grievance Commission. The Court also noted that Mr. Dore took corrective action by filing revised affidavits and spent an entire month trying to correct the problems resulting from the filing of affidavits in his name that were signed by law firm employees. The Court further noted that Mr. Dore’s law firm spent over $100,000 correcting the problems resulting from the prohibited practice.
During the disciplinary hearing, Mr. Dore testified that he relied on Maryland case law for the proposition that an individual may adopt the signature of another where authority is granted for the signature. However, Mr. Dore recognized that his research did not relate to the signature of documents before a notary public.
The Court’s decision to impose the ninety (90) day suspension focused on the widespread impact Mr. Dore’s conduct had on the processing of foreclosures in the State of Maryland. The Court explained that changes to the Maryland Rules of Procedure relating to the filing of affidavits in foreclosure cases were adopted based on evidence of affidavits not signed by attorneys, noting that “the negative impact of the legal professional is great.” In mitigation, the Court pointed out that Mr. Dore conducted a case-by-case review of each foreclosure action and stressed that “no inaccuracies have been cited or found in any of the affidavits”.
The Court’s disciplinary action against Mr. Dore followed a June, 2013 decision by the United States Court of Appeals for the Fourth Circuit2 holding that an attorney’s “counterfeit” signature on an affidavit filed in a foreclosure action did not constitute a material misrepresentation in violation of the Fair Debt Collection Practices Act (FDCPA) where the signature had no connection to the debt, where the homeowner was unquestionably in default, and where the documents correctly stated the amount of the debt.
The disclosure of irregularities in Maryland’s foreclosure process which lead to the adoption of stringent new court rules regulating attorneys and lenders resulted in a marked decrease in the number of foreclosure cases docketed over the past few years. However, Maryland experienced a 275% increase in foreclosure filings from July, 2012 to 20133 as law firms adapted to the more stringent rule requirements, freeing up the backlog of foreclosure filings.
The penalty imposed on Mr. Dore cannot be criticized as overly harsh in light of his prior 25 year record as a Maryland attorney. The increased number of foreclosure cases, even under more restrictive court rules, may again focus scrutiny on the foreclosure process. This oversight may well involve state and Federal regulators, including the Consumer Financial Protection Bureau which came into existence at the same time that Mr. Dore’s affidavit problems first came to light.
1 Attorney Grievance Commission of Maryland v. Dore ___ Md. ____, 2013 WL 4425388 (Md. Aug. 20,2013)
2 Lembach v. Bierman, 2013 WL 2501752 (4th Cir. June 12, 2013)
3 See, Realty Trac report at http://www.realtytrac.com/statsandtrends/foreclosuretrends/MD
Ronald S. Canter, Esq. is the founding member of The Law Offices of Ronald S. Canter, LLC of Rockville, Maryland. He is a member of the Bars of Maryland, Pennsylvania, Florida and the District of Columbia. He is also admitted to practice in federal courts through the United States, including the Supreme Court and several courts of appeal.
Mr. Canter has been engaged in the private practice of law since 1980. He is a recognized authority on creditor’s rights and the regulation of collection practices. He has represented creditors, attorneys and collection agencies in complex litigation in both Federal and state courts. Mr. Canter has successfully prosecuted appeals before state and federal courts on a number of significant issues affecting the credit and collection industry. He appeared, as counsel of record for the National Association of Retail Collection Attorneys (NARCA), in Heintz v. Jenkins, the first Fair Debt Collection Practices Act case to reach the Supreme Court.