This is a new variation on the old tactic of: When all else fails, blame the lawyers.
Note in the report I've linked to (as well as virtually every other report on the foreclosure mills that you or I can find) that these operations are universally described as paralegal driven. It is my theory that these operations have a use for lawyers: it is to have a ready-made alibi, a convenient scapegoat, ready to assume the blame for the very conscious misdeeds of a non-lawyer.
There may be thorny questions of attorney ethics to resolve. However, the blame-the-lawyer crowd almost always has the same material misconception as to lawyers' true role. Lawyers are advocates for their clients. Lawyers are not intended, nor required, and are certainly not paid, to investigate their own clients. Lawyers are also not compliance officers and definitely are not guarantors of their clients' obedience to the law.
Such missions are often literally impossible. The imposition of such expectations or directives on lawyers would not only transform the lawyers' role, but also require the cooperation of the client -- often the prime wrongdoer and concealer of the wrondoing! - in providing truthful, candid information to the lawyer. This presents not merely a thankless task, but too often, an impossible one.
Lawyers should not be "investigated" or be accused of civil or criminal wrongdoing merely because of their status as lawyers, nor should they be targeted because they may be young and presumed to be financially unable to defend themselves on account of burdensome college and law school loans -- and therefore, vulnerable to attack.
These elementary facts will not deter many politically ambitious investigators and prosecutors who see professionals like lawyers and accountants as delicious red meat for the masses, useful for whipping up public outrage and riding the resulting sea of indignation towards a lucrative private-sector gig or higher-profile government appointment. Investigating, and even wrongfully accusing young and often totally-innocent professionals will be no impediment. Those people too often are considered acceptable collateral damage.
Understand one thing, readers: You have some unsupervised, ignorant young lawyers out there who were taken advantage of by people who may have committed actual crimes, and who now may be under state -- and likely, federal -- criminal investigation on an issue where the political winds will blow very strongly for show trials and blood lust to satisfy the angry masses.
The more the investigations into the real estate mess proceed with seeking vengeance, the more the real villains will escape scrutiny. One suspects the true wrongdoers are the ones who gave the orders; these would be the same people who concealed facts -- the truth -- which if revealed and known would have made a difference in what the downstream lawyers and others chose to do. Among many professionals, it is known that young newbies -- even lawyers -- require (and want) meaningful suspicion. The problem here is what happens when your supervisor may be crooked.
For a real and much bigger criminal problem about fraudulent service of process, check out this story in this morning's Palm Beach Post.
While there are many bonafide victims in the real estate market crash, the fact remains that many people facing foreclosure recently were eager homebuyers in 2002-06 who were chasing double-digit housing appreciation and were too happy to overpay (and admit to having done so) because they wanted their piece of the "action."
This homeowner greed is a characteristic of a bubble. It was also characteristic of many other types of investor speculation. Such people, when they lose their money when the bubble bursts and market plunges, should not be assumed to be victims. Sharp investment losses resulting from often-horrid investment decisions do not qualify one as a victim deserving of repair at the expense of the more prudent neighbor.
Eric Dixon is a New York lawyer specializing in investigating complex financial and business matters. Mr. Dixon is a 1994 graduate of Yale Law School and has significant securities compliance, business transactions and investigative experience. Mr. Dixon is available for consultation and comment at 917-696-2442 and via e-mail at edixon@NYBusinessCounsel.com.