OFFICE OF THE ATTORNEY GENERAL STATE OF FLORIDA DEPARTMENT OF LEGAL AFFAIRS

Size: px

Start display at page:

Download "OFFICE OF THE ATTORNEY GENERAL STATE OF FLORIDA DEPARTMENT OF LEGAL AFFAIRS"

Jessie Boone
5 years ago
Views:

IN THE MATTER OF: OFFICE OF THE ATTORNEY GENERAL STATE OF FLORIDA DEPARTMENT OF LEGAL AFFAIRS OCEAN LEGAL GROUP, PA, CAPLAW,PA, Florida corporations, and JAMES FRANKLIN CAPLAN, an individual, d/b/a

I ASSURANCE OF VOLUNTARY COMPLIANCE PURSUANT TO the provisions of Chapter 501, Part II, Florida Statutes, the Florida Deceptive and Unfair Trade Practices Act ("FDUTPA"), the Consumer Financial

1 IN THE MATTER OF: OFFICE OF THE ATTORNEY GENERAL STATE OF FLORIDA DEPARTMENT OF LEGAL AFFAIRS OCEAN LEGAL GROUP, PA, CAPLAW,PA, Florida corporations, and JAMES FRANKLIN CAPLAN, an individual, d/b/a Law Office of James F. Caplan, PA, AG Case No. L Respondents. I ASSURANCE OF VOLUNTARY COMPLIANCE PURSUANT TO the provisions of Chapter 501, Part II, Florida Statutes, the Florida Deceptive and Unfair Trade Practices Act ("FDUTPA"), the Consumer Financial Protection Act of 2010, 12 U.S.C. Sections 5564, 5565, 12 U.S.C. Sections 5552, and the Mortgage Assistance Relief Services Rule, 12 CFR Part 1015 ("MARS Rule"), the OFFICE OF THE ATTORNEY GENERAL, ST ATE OF FLORIDA, DEPARTMENT OF LEGAL AFFAIRS (hereinafter the ADepartment@), caused an investigation to be made into the business practices of $ Initials

OCEAN LEGAL GROUP, PA, a Florida corporation, CAPLAW, PA, a Florida corporation, and JAMES FRANKLIN CAPLAN, an individual (hereinafter collectively referred to as ARespondents@).

matter with the Department, and the Department, by and through the undersigned Deputy Attorney General, being in agreement, does in this matter accept this AVC in termination of this investigation,

1 Respondent CAPLAN is an attorney who has been a member of the Florida Bar since 1990. OCEAN LEGAL GROUP, PA and CAPLAW, PA are corporate entities and CAPLAN's law firms.

2 OCEAN LEGAL GROUP, PA, a Florida corporation, CAPLAW, PA, a Florida corporation, and JAMES FRANKLIN CAPLAN, an individual (hereinafter collectively referred to as ARespondents@). RESPONDENTS are prepared to enter into this Assurance of Voluntary Compliance (hereinafter AA VC@), without any admission that Respondents have violated the law, for the purpose of resolution of this matter with the Department, and the Department, by and through the undersigned Deputy Attorney General, being in agreement, does in this matter accept this AVC in termination of this investigation, pursuant to Section ( 6), Florida Statutes, and by virtue of the authority vested in the Department by said statute. I. STIPULATED FACTS 1.1 Respondent CAPLAN is an attorney who has been a member of the Florida Bar since OCEAN LEGAL GROUP, PA and CAPLAW, PA are corporate entities and CAPLAN's law firms. Respondents have also conducted business under the name "Law Office of James F. Caplan, PA." At all times material hereto, Respondents collectively operated as a law firm, with a principal office located at 824 US 1 # 110, North Palm Beach, Florida. 1.2 The Department has investigated allegations that the Respondents may have violated the provision of Section , Florida Statutes, that prohibits the collection of an advance fee for foreclosure-related rescue services, 2 ~nitials

and that Respondents' written agreements to perform such services did not include language required by the statute; Section 501.

Rule, 12 C.F.R. Section 1015, which prohibits the collection of advance fees for mortgage assistance relief services by attorneys who are not licensed to practice in the state in which the homeowner

3 and that Respondents' written agreements to perform such services did not include language required by the statute; Section , Florida Statutes, which prohibits unconscionable acts or practices and unfair or deceptive acts or practices in the conduct of any trade or commerce; and the MARS Rule, 12 C.F.R. Section 1015, which prohibits the collection of advance fees for mortgage assistance relief services by attorneys who are not licensed to practice in the state in which the homeowner or property is located, and that Respondents' written agreements to perform such services did not include language required by the rule. 1.3 The MARS Rule defines "Mortgage Assistance Relief Service,, (hereinafter "MARS") as any service, plan, or program, offered, or provided to the consumer in exchange for consideration, that is represented, expressly or by implication, to assist or attempt to assist the consumer with any of the following: ( 1) Stopping, preventing, or postponing any mortgage or deed of trust foreclosure sale for the consumer's dwelling, any repossession of the consumer's dwelling, or otherwise saving the consumer's dwelling from foreclosure or repossession; (2) Negotiating, obtaining, or arranging a modification of any term of a dwelling loan, including a reduction in the amount of interest, principal balance, monthly payments, or fees; (3) Obtaining any forbearance or modification in the timing of payments from any dwelling loan holder or servicer on any dwelling loan; ( 4) Negotiating, obtaining, or arranging any extension of the period of time within which the consumer may: (i) Cure his or her default on a dwelling loan, (ii) Reinstate his or her dwelling loan, 3 ~ Initials

(iii) Redeem a dwelling, or (iv) Exercise any right to reinstate a dwelling loan or redeem a dwelling; (5) Obtaining any waiver of an acceleration clause or balloon payment contained in any

a dwelling other than a sale to a third party who is not the dwelling loan holder. 12 CFR Section 1015.2. 1.4 Section 501.

Stopping, avoiding, or delaying foreclosure proceedings concerning residential real property; or 2.

4 (iii) Redeem a dwelling, or (iv) Exercise any right to reinstate a dwelling loan or redeem a dwelling; (5) Obtaining any waiver of an acceleration clause or balloon payment contained in any promissory note or contract secured by any dwelling; or (6) Negotiating, obtaining or arranging: (i) A short sale of a dwelling, (ii) A deed-in-lieu of foreclosure, or (iii) Any other disposition of a dwelling other than a sale to a third party who is not the dwelling loan holder. 12 CFR Section Section (2)(c), Florida Statutes, defines "Foreclosure-Related Rescue Services" (hereinafter "FRRS'') as "any good or service related to, or promising assistance in connection with: 1. Stopping, avoiding, or delaying foreclosure proceedings concerning residential real property; or 2. Curing or otherwise addressing a default or failure to timely pay with respect to a residential mortgage loan obligation." 1.5 Respondents solicited consumers nationwide to perform services that were MARS and/or Section (2) (c) related. A majority of the clients who retained Respondents for representation in these matters neither resided, nor owned property, in a state where CAPLAN is licensed to practice law. 1.6 Respondents advertised and performed these services as part of a nationwide network of attorneys. Respondents solicited this business from clients outside of Florida based upon the premise that other attorneys, who were not 4 $ Initials

employed by Respondent, but part of a nationwide network, could provide legal representation in a foreclosure matter, if the need arose. 1.

8 Respondent and the Department desire to resolve all issues arising during the course of this investigation. 1.9 This A VC is based upon the stipulated facts set forth in Paragraphs 1.1 through 1.

The Department shall not be estopped from taking further action in this matter should the facts described herein be shown to be incorrect in any material way, or the AVC not be complied with in full.

5 employed by Respondent, but part of a nationwide network, could provide legal representation in a foreclosure matter, if the need arose. 1.7 The Department received numerous complaints from consumers in Florida and other states alleging that they had paid Respondents to negotiate mortgage modifications that never materialized. 1.8 Respondent and the Department desire to resolve all issues arising during the course of this investigation. 1.9 This A VC is based upon the stipulated facts set forth in Paragraphs 1.1 through 1. 7 above. The Department shall not be estopped from taking further action in this matter should the facts described herein be shown to be incorrect in any material way, or the AVC not be complied with in full. II. TERMS 2.1 Within ninety (90) days of the execution of this A VC, Respondent shall affiliate with a licensed attorney in any state where he is representing anyone on a mortgage modification, mortgage foreclosure rescue or performing any MARS or FRRS work and provide proof of such affiliation to the Attorney General's Office. 2.2 Unless CAPLAN has appeared in a foreclosure proceeding on behalf of a Florida client, that client shall be entitled, upon request, and with appropriate documentation to a refund of any unearned fees collected by Respondents to 5 ~ Initial s

perform MARS/FRRS, per Exhibit A attached pursuant to the provisions in 3.7 herein. 2.3 Any additional or future consumer MARS/FRRS complaints will be submitted to the Florida Bar for fee arbitration.

4 Within ninety (90) days of the execution of this AVC, Respondents shall sever their contractual relationship with Friedman Law Associates, PC. 2.

6 perform MARS/FRRS, per Exhibit A attached pursuant to the provisions in 3.7 herein. 2.3 Any additional or future consumer MARS/FRRS complaints will be submitted to the Florida Bar for fee arbitration. The arbitrator's decision shall be binding on Respondents. 2.4 Within ninety (90) days of the execution of this AVC, Respondents shall sever their contractual relationship with Friedman Law Associates, PC. 2.5 Nothing in this A VC shall be construed as a waiver of any private rights of any person or release of any private rights, causes of action, or remedies of any person against the Respondents. In addition, nothing herein shall be construed to limit or bar any other governmental entity from pursuing other available remedies against the Respondents for acts and practices addressed by this AVC. III. STIPULATED PAYMENT 3.1 Respondents shall pay a maximum of consumer restitution, costs and fees in the amount of ONE HUNDRED FOURTEEN THOUSAND NINE HUNDRED SIXTEEN DOLLARS ($114,016.00), and shall first pay Consumers who did not obtain mortgage relief or loss mitigation assistance and whose loss is sufficiently documented and listed in the attached Exhibit A as provided in paragraph 3.7 of this AVC. 6 ~ Initials

' 3.2 Respondents shall pay THIRTY-EIGHT THOUSAND FIVE HUNDRED FIFTEEN DOLLARS ($38,515.

3 All funds shall be paid by certified funds payable to the Department of Legal Affairs Revolving Trust Fund.

4 Payment of all costs and fees shall be by certified funds made payable as described above and delivered to: Office of the Attorney General, ATTN: E.

7 ' 3.2 Respondents shall pay THIRTY-EIGHT THOUSAND FIVE HUNDRED FIFTEEN DOLLARS ($38,515.00) as costs and fees to the Department of Legal Affairs Revolving Trust Fund after all consumer restitution has been made. 3.3 All funds shall be paid by certified funds payable to the Department of Legal Affairs Revolving Trust Fund. All payments shall be deposited in the Department of Legal Affairs' Revolving Trust Fund, in accordance with Section (1) Florida Statutes. 3.4 Payment of all costs and fees shall be by certified funds made payable as described above and delivered to: Office of the Attorney General, ATTN: E. Carlton Carter, Assistant Attorney General, Central Florida Consumer Protection Division, 3507 East Frontage Road, Suite 325, Tampa, FL It is further agreed by the parties that Respondents shall pay a civil penalty of FIFTY THOUSAND DOLLARS ($50,000.00) to the Department for willful violation of the provisions of Chapter 501, Part II, Florida Statutes, The Florida Deceptive and Unfair Trade Practices Act. Upon execution of this AVC, Respondents shall pay ONE THOUSAND DOLLARS ($1,000.00) of this penalty to the Department of Legal Affairs Revolving Trust Fund by certified funds or wire transfer, which shall then be deposited into the General Revenue Fund, unal 1 ocated. 7 ~ Initials

3.6 In consideration for the fulfillment of the various obligations set forth above, and the information supplied by Respondents in a sworn Financial Statement submitted to the Department, the

However, if Respondents fail to comply with the requirements of this A VC, the civil penalties, shall become immediately due and owing.

7 Within forty-five (45) days of execution of this AVC, CAPLAN shall begin restitution in the following manner: A.

8 3.6 In consideration for the fulfillment of the various obligations set forth above, and the information supplied by Respondents in a sworn Financial Statement submitted to the Department, the payment of the remaining FOR TY NINE THOUSAND DOLLARS ($49,000.00) of the civil penalties is SUSPENDED. However, if Respondents fail to comply with the requirements of this A VC, the civil penalties, shall become immediately due and owing. In addition, the Attorney General reserves the right to seek additional investigative and attorneys' fees and costs upon default, as defined herein, or upon future noncompliance. 3.7 Within forty-five (45) days of execution of this AVC, CAPLAN shall begin restitution in the following manner: A. CAPLAN shall keep detailed records of compliance with all refund procedures, including copies of correspondence and consumer responses (including, returned mail), provide proof of compliance in quarterly reports to the Department and provide copies of any records reasonably requested by the Department. Quarterly reports relating to activity of the preceding calendar quarter shall be submitted to the Department at the address specified in paragraph 3.4 no later than the 20th day of the month following the end of the quarter. The quarterly reports must detail CAPLAN'S funding of payments required by this A VC and the status of the restitution process, including a spreadsheet which details the identity 8 ~ Initial s

of each consumer, the correspondence to and from each consumer, payment amount, check number, and corresponding date. B.

determine a consumer's potential eligibility for a refund. C. If the consumer responds that he or she did receive loss mitigation assistance from CAPLAN, the consumer is not eligible for a refund.

9 of each consumer, the correspondence to and from each consumer, payment amount, check number, and corresponding date. B. CAPLAN shall by First Class and certified mail send the letter attached hereto as Exhibit B, the "Refund Eligibility Letter", to all consumers listed on the consumer complaint list, Exhibit A, to determine a consumer's potential eligibility for a refund. C. If the consumer responds that he or she did receive loss mitigation assistance from CAPLAN, the consumer is not eligible for a refund. CAPLAN will keep a record of all consumer responses and provide proof of such to the Department. D. If the consumer responds within seventy-five (75) days (forty-five (45) days plus a thirty (30) day grace period set forth in paragraph E below) from the date the Refund Eligibility Letter was mailed that he or she did not receive any loss mitigation from CAPLAN, CAPLAN shall determine the consumer eligible for a partial refund equal to FIFTY (50%) of the fees paid by the consumer. For purposes of determining the amount paid by the consumer, that amount is deemed to be the amount paid contained in the consumer complaint and supp01ting documentation the consumer provided to the Department. The consumer names and amounts paid are attached hereto as Exhibit A. If any consumer on Exhibit A has already been refunded by CAPLAN, then no refund shall be due and the name 9 -il-initials

responses received during this time in determining consumers eligible for partial refund. F. CAPLAN shall escrow TWO THOUSAND SIX HUNDRED DOLLARS ($2,600.

10 will be marked off upon proof submitted to the Department. E. CAPLAN shall allow a thirty (30) day grace period for consumer responses received after the forty-five ( 45) day due date to respond stated in the Refund Eligibility Letters, and include any consumer responses received during this time in determining consumers eligible for partial refund. F. CAPLAN shall escrow TWO THOUSAND SIX HUNDRED DOLLARS ($2,600.00) per month beginning thirty (30) days after the parties have executed this AVC until restitution and attorneys' fees and costs are paid, and provide proof of such and the amount in escrow and a copy of the financial account statement reflecting the escrow funds in the quarterly reports to the Department. G. CAPLAN shall distribute pro-rata all funds in the escrow account to all consumers determined eligible for a partial refund every six (6) months until completed. H. All consumer restitution shall be paid first and completed within TWENTY-FOUR (24) months from the effective date of this AVC. I. Any outstanding restitution, attorneys' fees and costs and any other monies owed under this A VC shall be completed within thirty-six (36) months from the effective date of this AVC, not to exceed ONE HUNDRED FOURTEEN THOUSAND SIXTEEN DOLLARS ($114,016.00). J. Time is of the essence in the performance of all obligations required 10 ~ Initials

avoiding the terms and conditions set forth in this AVC. 4.

11 by this AVC. IV. COMPLIANCE 4.1 Respondents shall not affect any change in the form of doing business, or the organizational identity of any of the existing business entities, or create any new business entities, as a method of avoiding the terms and conditions set forth in this AVC. 4.2 Respondents and their representatives, agents, employees, successors, assigns or any other person, who acts under, by, through, or on behalf of Respondents, directly or indirectly, or through any corporate or other device, shall comply with the Florida Deceptive and Unfair Trade Practices Act, Chapter 501, Parts I and II, Florida Statutes, and Part IV, Florida Telemarketing Act., 4.3 Respondents and their representatives, agents, employees, successors, assigns or any other person, who acts under, by, through or on behalf of Respondents, directly or indirectly, or through any corporate or other device, shall fully comply with all rules and regulations regarding MARS, FRRS and all Florida Bar rules regarding regulation of any fees for financial assistance, mortgage modification or foreclosure practices. 4.4 Respondents shall make all terms and conditions of this A VC known to all employees, representatives, agents, successors, assigns, or any other person who acts un4er, by, through, or on behalf of the Respondent Business. 11 ~ Initial s

4.5 Respondents agree to retain documents and other information reasonably sufficient to establish compliance with the provisions herein, and shall provide reasonable access to such documents and

6 Respondents shall voluntarily comply with any reasonable requests from the Department or any other law enforcement or regulatory agency of any other individuals or entities relating to allegations

12 4.5 Respondents agree to retain documents and other information reasonably sufficient to establish compliance with the provisions herein, and shall provide reasonable access to such documents and information to the Department upon request. 4.6 Respondents shall voluntarily comply with any reasonable requests from the Department or any other law enforcement or regulatory agency of any other individuals or entities relating to allegations of violations of the MARS Rule orfdutpa. V. FUTURE VIOLATIONS 5.1 Any subsequent failure to comply with the terms and conditions of this A VC is by statute prima facie evidence of a violation of Chapter 501, Part II, Florida Statutes, and will subject Respondents to any and all civil penalties and sanctions authorized by law, including attorneys' fees and costs. VI. ACCEPTANCE 6.1 It is hereby agreed by the parties that this AVC shall become effective upon its acceptance by the Deputy Attorney General, who may refuse to accept it at her discretion. The receipt of or deposit by the Department of any monies pursuant to this A VC does constitute acceptance by said Department, and monies received will be returned if this AVC is not accepted. 12 Initials

.. BY MY SIGNATURE I hereby affirm that I am acting in my individual

and CAPLA W, PA, and that I am binding all Respondents to the terms and

STATE OF FLORIDA COUNTY OF PALM BEACH BEFORE ME, an officer duly authorized

FRANKLIN CAPLAN, individually, and as Proprietor of OCEAN LEGAL GROUP, PA

He acknowledged before me that he executed the foregoing instrument for the

$. 11 fl \.., \VALTERJ. M!$

13 .. BY MY SIGNATURE I hereby affirm that I am acting in my individual capacity and within my authority as proprietor of OCEAN LEGAL GROUP, PA, and CAPLA W, PA, and that I am binding all Respondents to the terms and conditions of this A VC. STATE OF FLORIDA COUNTY OF PALM BEACH BEFORE ME, an officer duly authorized to take acknowledgments in the State of ~/o;--; ti<, appeared JAMES FRANKLIN CAPLAN, individually, and as Proprietor of OCEAN LEGAL GROUP, PA and CAP LAW, PA. He acknowledged before me that he executed the foregoing instrument for the purposes therein stated on the z:f- day of -: //,2016 NOTARY PUBLIC tf!. 11 fl \.., \VALTERJ. M!RANDA Notary Public, State of Florida Commission # FF J/ 1_ ~ ~ -!:'/ ~m."';.."'!ra=j"m11,2017 (Print, ~or stamp commissioned Notary Public) Personally known or Produced Identification ;_>< (check one) Type of Identification Produced:,t:.t_ f.> L 13

Frontage Road, Suite 325 Tampa, Florida 33607

CONNERS Deputy Attorney General Office of the

14 .. "'.. ~~ ATTORNEY GENERAL E. CARLTON CARTER Assistant Attorney General Florida Bar # Consumer Protection Division 3507 E. Frontage Road, Suite 325 Tampa, Florida (813) A-8~ PATRICIA A. CONNERS Deputy Attorney General Office of the Attorney General The Capitol PL-01 Tallahassee, Florida Accepted this J ;,,.f( day of A-\. f u-.> V-, Initials

OFFICE OF THE ATTORNEY GENERAL STATE OF FLORIDA DEPARTMENT OF LEGAL AFFAIRS ASSURANCE OF VOLUNTARY COMPLIANCE

OFFICE OF THE ATTORNEY GENERAL STATE OF FLORIDA DEPARTMENT OF LEGAL AFFAIRS IN THE MATTER OF: TINT MASTER, INC., a Florida corporation, AG Case No. L-12-3-1128'6 Respondent. -----------------------------------------'