New York foreclosure law firm Steven J. Baum PC along with two top attorneys at the firm agreed to pay $4 million to settle a state investigation into its foreclosure practices. The deal also includes the Baum firm's back office arm, Pillar Processing.

The deal bars attorneys Steven J. Baum and Brian Kumiega from representing lenders or servicers in new foreclosure-related cases for two years.

New York Attorney General Eric Schneiderman said the deal includes $2 million in assistance for homeowners facing foreclosure or victims of predatory lending practices.

The Baum firm was the largest foreclosure firm in New York state until it ceased most of its operations late last year. It was one of two large foreclosure processing firms to close last year in the wake of the robo-signing scandal. In March 2011, the Law Offices of David J. Stern in Plantation, Fla., ceased foreclosure work.

In October, the Baum firm agreed to overhaul its practices and to pay a $2 million Department of Justice fine.

Between 2007 and 2010, the Baum firm filed more than 100,000 foreclosure proceedings and represented many of the largest servicers of residential mortgage loans, according to the AG's office.

“The Baum firm cut corners in order to maximize the number of its foreclosure filings and its profits,” said  Schneiderman said in a news release. "This settlement demonstrates that my office will not allow New York homeowners to face the drastic consequence of foreclosure based upon inaccurate documents filed in court."

The AG's office said its investigation found that the Baum firm routinely brought foreclosure proceedings without taking appropriate steps to verify the accuracy of the allegations or the plaintiff's right to foreclose.

Schneiderman has been an outspoken critic of the mortgage industry and its practices during the housing crisis.

The AG initially rejected but later signed a national settlement with the country's top five mortgage servicers to address foreclosure problems related to the robo-signing scandal. He recently was selected by President Barack Obama to co-chair a federal-state task force investigating mortgage fraud in the mortgage-backed securities sector.

Earlier this year, the new task force subpoenaed 11 banks as part of its investigation.