CA State Bar Files Petitions on Alleged Modification Fraud
The State Bar of California filed petitions against two attorneys that would render them involuntarily inactive during investigations into their involvement in alleged loan modification fraud. In September, the State Bar identified 16 attorneys that allegedly took fees for the promise of getting a loan modified and then failed to perform the modifications, notify the client or return the fees, according to a release. The State Bar found enough evidence against Paul Lucas and Sean Rutledge to file the petitions to halt their practice of law, said Suzan Anderson, the supervising trial counsel and head of the loan modification investigation special unit. Rutledge’s hearing will be held Oct. 15, 2009 at the State Bar Court in Los Angeles, California. Lucas’ hearing is scheduled for Oct. 21. “These [petitions] were filed based on the harm caused to their clients and the public,” Anderson said. The State Bar also received the resignation with charges pending from Cameron Edwards. About 25% of the active investigations in the Office of Chief Trial Counsel -- or 800 cases -- relate to foreclosure complaints, according to the State Bar release. The complaints increased 58% over 2008 because of the amount of complaints against the attorneys. In March of 2009, the State Bar formed a special team of investigators and lawyers to handle the surge of reported violations. “The number of attorneys using their law licenses to essentially take money from unwary but trusting consumers is astounding,” said the interim chief trial counsel Russell Weiner. “There are literally thousands of victims who have lost money they could not afford to lose. Under the circumstances, the need for public information and protection is paramount.” Write to Jon Prior.