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Mortgage Foe Suing Banks

Local attorney who won major settlement continues her fight to protect home buyers.

By Kimberly Miller
Palm Beach Post Staff Writer
WEST PALM BEACH — From her 13th-floor office on Flagler Drive, Palm Beach Gardens resident Lynn Szymoniak looks out at the industry she’s been trying to hold accountable since her own foreclosure led her to a mother lode of mortgage malfeasance. Powerful financial institutions line the
sparkling Intracoastal Waterway and spill over into well-heeled Palm Beach, but Szymoniak isn’t cowed. The 64-year-old attorney and white-collar crime investigator has doggedly pursued the industry that once sued her
college-age son in her foreclosure case and tried to depose her pool boy.

Last year she won an $18 million settlement for bringing a whistle-blower complaint against the nation’s largest banks. Now, she’s been cleared to move forward with the second part of that case after the Justice Department pulled out and the lawsuit was unsealed this month by a federal judge. The $18 million settlement, which pays for her Housing Justice Foundation, is aiding the pursuit. “This feels unsettled to me,” said Szymoniak about the case she filed in 2010 under the federal False Claims Act. “We’re really gearing up now. This is our green light.” The False Claims Act allows people to bring civil actions on behalf of the government. The Department of Justice intervened in Szymoniak’s suit, reaching a $95 million settlement, which included Szymoniak’s $18 million.

Faked documents? When the government declined to intervene in the second part of the case, it fell to Szymoniak and her team of trial attorneys to carry on. “Rather than our government stepping in to protect consumers, you have someone like Lynn, who at great risk and cost to herself, is standing up to fight,” said foreclosure defense attorney Matt Weidner. “It’s one person saying that what is happening is wrong and I’m not going to accept this.” The accusations are not easy reading. Boiled down, Szymoniak claims the value of pools of homes bundled into investments has been weakened by either a lack of documentation to prove clear title or forged and flawed mortgage assignments that were produced to secure loans to properties. Private groups and public pensions bought into the mortgage asset pools. The complaint says when banks realized critical documents were missing in hundreds of mortgage-backed security trusts, they “devised a scheme to replace the missing” mortgage assignments with fraudulent and fabricated documents.

New car, new mission “They were investing in pools of loans not attached to mortgages, or the loans never even got into the pool,” Szymoniak said. “We do a worse job tracking who owns property than who owns a car.” Szymoniak began her investigations when she defaulted on her own loan after a dispute concerning her adjustable-rate mortgage. When a foreclosure was filed against her in 2008, the plaintiff wasn’t her bank, but a trustee for a mortgage-backed security that had no proof about how it acquired her mortgage. To prove ownership, an assignment of mortgage was filed, but it was dated months after the foreclosure. One of the people who signed the assignment is the now infamous robo-signer Linda Green. Szymoniak exposed Green in 2011 on the CBS news show “60 Minutes.” Green was an employee of mortgage servicing firm DocX, which later became Jacksonville-based LPS Document Solutions. She held multiple leadership titles at different lenders and mortgage firms, but in reality at least eight DocX employees were signing her name to mortgage-related documents. Lorraine Brown, the former president of DocX, was sentenced in June to five years in prison for scheming to file more than 1 million fraudulent mortgage-related documents nationwide.

Since the $18 million settlement, Szymoniak has paid off her mortgage, bought a new Buick and set up her Housing Justice Foundation on the 13th floor of the Sun-Trust building in downtown West Palm Beach. She takes no salary herself, but pays three employees. The foundation isn’t for individual homeowner cases. It focuses instead on the bigger picture of securities and trusts, doing research, collecting documents and tracking the ownership of blighted homes caught up in the system. Two closets with rows of 3-inch-thick binders of robo-signed paperwork and other faulty documents attest to the research she and the foundation have done on the issues. Szymoniak admits it can be tedious. She said people ask her why she didn’t just retire after the $18 million settlement. “I’m not satisfied that’s the end of the story,” she answers.This entry was posted in Loan Modification and tagged Advice, Consulting, Foreclosure, Loan, Success on

February 14, 2014.

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