Lars Peterson

Jon Van Dyke has passed away

Fri, 02 Dec 2011 00:40:26 GMT

As reported in PBN on 12/1/11:

Hawaii law professor Jon Van Dyke dies
Pacific Business News
Date: Wednesday, November 30, 2011, 12:03pm HST

Jon Van Dyke, a constitutional law professor at the University of Hawaii ’s Richardson School of Law, has died.

Van Dyke, who was 68, died in his sleep Tuesday while at a Law of the Sea conference in Australia, the law school said in a statement.

“Jon was admired, loved, and vitally important throughout a remarkable number of different circles of people stretching far beyond our Law School, but we were particularly and truly blessed to have the direct benefit of his many years of inspirational teaching and scholarship, remarkable public service, and deep and abiding friendship,” Dean Avi Soifer said in a letter to the students and faculty posted on the school’s website.

Van Dyke was the law school’s Carlsmith Ball Faculty Scholar, and the author of six books, including “Who Owns the Crown Lands of Hawaii?,” which was published in 2008. He joined the UH faculty in 1976 and taught constitutional law, international law, international ocean law, and international human rights. Van Dyke also served as the law school’s associate dean from 1982-88.

Van Dyke is survived by his wife, Honolulu attorney Sherry Broder; daughter Michelle; and sons Eric and Jesse Broder Van Dyke, who is a spokesman for Sen. Daniel Akaka.

Bankruptcy filings down again - by 26%

Fri, 02 Dec 2011 00:37:31 GMT

As reported today, 12.1.2011 in Pacific Business News:

Hawaii bankruptcy filings fall 26% in November
Pacific Business News
Date: Thursday, December 1, 2011, 11:31am HST
Related:
Bankruptcies

The number of bankruptcy filings in Hawaii fell by 26 percent last month compared to a year ago, according to statistics from the U.S. Bankruptcy Court.

There were 242 filings of all chapters of the U.S. bankruptcy code in November, compared to 327 filings during the same month in 2010.

The number of Chapter 7 bankruptcy cases, which are most often filed by individuals, fell 23.2 percent to 185 cases in November, compared to 241 cases in November 2010.

The number of Chapter 13 bankruptcy cases fell 30.5 percent to 57 filings last month, compared to 82 in November of last year.

There were no filings under other chapters of the code, such as Chapter 11 reorganization, in November, according to court statistics.

Year-to-date, bankruptcy filings for the first 11 months of the year were 21 percent lower than the same period in 2010.

There were a total of 3,115 bankruptcy filings from January through November, compared to 3,954 filings in 2010.

Sheriff's department waiting for move-in day in Kakaako - Hawaii News Now - KGMB and KHNL Home

Thu, 29 Sep 2011 23:25:42 GMT

Sheriff's department waiting for move-in day in Kakaako - Hawaii News Now - KGMB and KHNL Home

Bus driver who hit, fatally injured man sentenced - Mauinews.com | News, Sports, Jobs, Visitor's Inf

Thu, 29 Sep 2011 23:17:25 GMT

As reported in the Maui News today, 9/29/11:

Bus driver who hit, fatally injured man sentenced - Mauinews.com | News, Sports, Jobs, Visitor's Information - The Maui News

Bankruptcy filings in July down-2nd straight month with substantial decline

Tue, 02 Aug 2011 16:40:57 GMT

As reported in PBN:

Hawaii bankruptcy filings down 22% in July
Pacific Business News
Date: Monday, August 1, 2011, 12:36pm HST
Related: Bankruptcies

Hawaii saw a total of 268 bankruptcy filings in July, a 22.3 percent decline from the 345 filings recorded in July 2010, according to the U.S. Bankruptcy Court.
Out of the total number of filings, there were 221 Chapter 7 cases filed last month, down 14.7 percent from 259 cases in July of last year. There were also 45 Chapter 13 bankruptcy filings in July, down 46.4 percent from the 84 filings recorded a year ago.
In addition, there were two other cases filed last month, which was unchanged from July 2010, according to PBN research.
Filings fell in all counties, led by a 37.5 percent drop to 35 cases in Hawaii County; a 21.4 percent drop to 168 cases in Honolulu County; a 13.6 percent decline to 19 cases in Kauai County; and a 13.2 percent decline to 46 cases in Maui County.

Bankruptcy filings down for first time this year

Fri, 15 Jul 2011 03:07:33 GMT

Hawaii bankruptcy filings down 25.6 percent in June
By Erika Engle, Hawaii News Now

POSTED: 12:35 p.m. HST, Jul 01, 2011

Hawaii bankruptcy filings in June were down 25.6 percent from June of last year, largely in the numbers of Chapter 7 liquidation and Chapter 13 wage-earner cases.

Chapter 11 business reorganization filings were up with seven cases filed in June versus two a year ago.

The highest profile bankruptcy case last month was Hawaii Medical Center. The former St. Francis Medical Centers in Liliha and Ewa, filed for Chapter 11 bankruptcy protection on June 21, less than a year after emerging from bankruptcy.

Ethics Complaint Filed Against Honolulu Prosecutor Kaneshiro

Fri, 15 Jul 2011 02:59:54 GMT

Hawaii Reporter:

Interestingly, a former PROSECUTOR files an ethics complaint!!!

http://www.hawaiireporter.com/ethics-complaint-filed-against-honolulu-prosecutor-kaneshiro/123

Defense Lawyers Dispute Prosecutor Kaneshiro

Fri, 15 Jul 2011 02:55:30 GMT

Hawaii Reporter:

Defense Lawyers Dispute Prosecutor Kaneshiro
BY JIM DOOLEY – Prominent criminal defense attorneys are scoffing at Honolulu Prosecutor Keith Kaneshiro’s stated positions that he will no longer plea bargain cases and that he is under no obligation to turn over certain evidence in criminal cases.

Keith Kaneshiro
In an exclusive interview yesterday with Hawaii Reporter, Kaneshiro said he is requiring his deputies to take cases to trial and will only plea bargain in rare instances such as when a prosecution witness is unavailable for trial or when the plea deal results in the same penalty as a trial conviction.
“He’s just political grandstanding,” said Myles Breiner, president of the Hawaii Association of Criminal Defense Lawyers.
“The fact of the matter is he has to plea bargain. There’s just too many cases and too many bad cases,” said Breiner.
Longtime criminal defense lawyer Brook Hart estimated that “90 per cent of cases are resolved through plea agreements.”
Jack Tonaki, head of the Hawaii Public Defender’s Office, said he thinks the figure is even higher.
“The reality is that if one day he says there will be no (plea) agreements, everything will pretty much come to a halt,” Tonaki said.
The same attorneys took exception to Kaneshiro’s position that his office doesn’t need to inform defense counsel if a prosecution witness has given inconsistent statements about a crime.
That position has prompted the filing of an ethical complaint against Kaneshiro with the state Bar Association’s disciplinary board.
Kaneshiro acknowledged yesterday that he did tell two deputies in his office that they did not have to inform the defense in a domestic violence case that the victim had given inconsistent statements about the crime.
“What the victim said was, her statement was a little bit different, she left out some facts so it was not totally consistent with earlier statements,” Kaneshiro said.
“There’s case law that says an inconsistent statement is not recantation, it is not discoverable (evidence)” which must be turned over to the defense, Kaneshiro said.

Myles Breiner
“That’s utter nonsense,” said Breiner today.
Court rules and federal and state case law “require disclosure of any statement by a percipient witness whether it supports or doesn’t support the prosecution theory of the case,” said Breiner.
Hart said the U.S. Supreme Court has ruled that “the Constitution requires the government when it has inconsistent evidence to turn it over to the defendant at the earliest possible time.”
There can be legitimate questions about whether information is relevant to a case, Hart said.
“It might or it might not be material. But the most enlightened prosecutors readily turn over all this information so that later, cases are not subject to reversal on appeal

Brook Hart
because of a failure to provide exculpatory evidence,” Hart said.
Tonaki cited a state criminal procedure rule which requires prosecutors to turn over evidence which would tend to negate the guilt or lower the potential punishment of a defendant.
The key phrase is “tend to negate,” said Tonaki.
“We always differ in our interpretation of the rules and ultimately its decided by the court but I think that if a material witness in a case changes their story, that may have the effect of tending to negate the guilt and it should be disclosed,” Tonaki said.
Several attorneys noted that in the high-profile rape prosecution now pending in New York against former World Bank President Dominique Strauss-Kahn, prosecutors informed the defendant’s attorneys of inconsistencies in statements given about the case by the complaining witness after Strauss-Kahn was charged.
And attorneys also questioned the accuracy of Kaneshiro’s assertion that the prosecutor’s office under previous head Peter Carlisle had a jury trial conviction rate of just 33 per cent.
Kaneshiro spokesman Dave Koga said today the office is gathering the data supporting the 33 per cent conviction rate figure.
In 2005, the Honolulu Advertiser published the results of a study that showed the felony trial conviction rate for Carlisle’s officer that year was 67 per cent. The same story said several times that the corresponding acquittal rate was 33 per cent.
Carlisle, now Honolulu Mayor, has not responded to requests for comment on Kaneshiro’s statements. Several of the 34 deputy prosecutors who left the office after Kaneshiro was sworn in have since gone to work in Carlisle’s administration.
Kaneshiro said some of the deputies departed because they preferred to plea-bargain cases and didn’t want to argue them in court.
Details of the ethics complaint filed against Kaneshiro are unknown because proceedings in the Office of Disciplinary Counsel are confidential.
Kaneshiro said Monday that the complaint was filed against Kaneshiro by a former high-ranking deputy prosecutor, Kevin Takata, who was forced out of the office after Kaneshiro was elected.
Takata has an “an axe to grind,” Kaneshiro said.
The disciplinary complaint “is completely untrue,” Kaneshiro said. “I have never told my deputies not to disclose discoverable material or exculpatory evidence.”
Takata, who is now a state deputy attorney general, declined to comment on the disciplinary complaint, saying it is confidential.

Short URL: http://www.hawaiireporter.com/?p=36875

http://www.hawaiireporter.com/defense-lawyers-dispute-prosecutor-kaneshiro/123

Bankruptcy filings remain steady in May-fewer Chapter 7, but more Chapter 13 cases filed

Fri, 03 Jun 2011 03:20:40 GMT

As reported on 6/2/11 in Pacific Business News:

Hawaii bankruptcy filings flat in May
Pacific Business News
Date: Wednesday, June 1, 2011, 2:23pm HST
Related:
Bankruptcies

Hawaii saw a total of 334 bankruptcy filings in May, down by less than 1 percent from the 336 filings that were recorded in May 2010, according to the U.S. Bankruptcy Court, District of Hawaii.

Out of the total number of cases, there were 241 Chapter 7 bankruptcies filed; that’s down 10.4 percent from the 269 cases filed during the same month last year. There were also 93 Chapter 13 bankruptcies filed last month, up 40.9 percent compared to the 66 cases filed in May of last year.

In addition, no Chapter 11 cases were filed in either May 2011 or May 2010, according to PBN research.

Read more: Hawaii bankruptcy filings flat in May | Pacific Business News

New DUI laws: 1st-time offenders can still drive, but with a device only

Fri, 15 Apr 2011 18:24:14 GMT

As reported in the Honolulu Star Advertiser on 4/15/11:

Ignition interlock device freezes drivers' lifestyles, too
By Gene Park

I was three vodka sevens in on a date night, 11:30 p.m. Wednesday in Chinatown, and I wasn't sure whether my car would let me drive.

That's because on Monday I volunteered to have an ignition interlock device installed for one week. It can't be all that bad, right?

I can tell you now: It's bad.

"Really?" my date said, as she climbed into my car and saw the wretched device and the mounted camera on my dashboard. "Really?"

"Please don't make me laugh," I pleaded. "I can't blow it right if I'm laughing." The fifth-grader in me let out a chuckle as I said that last sentence.

I swallowed my pride (and some saliva) as I wrapped my lips around the mouthpiece. I blew, my cheeks puffed like a puffer fish. Three seconds later and I started humming (you have to in order to pass).

My date quivered as she held in her laughter. She looked like she was getting electrocuted. I looked like an idiot.

Of course, I laughed. The device's screen showed "abort hum." That doesn't count as a fail; it just means I have to keep trying again. I think I got it right on my fourth try.

I passed, because even though I had had three cocktails, it was over a period of five hours, and I'd had several glasses of water.

If I had one drink and tried it out, there was a chance I could've gotten a fail, and my car's ignition would refuse to start. That's because the device doesn't let you drive if you're over .02 percent breath alcohol concentration, well below the .08 legal limit.

I forced this embarrassment upon myself because I wanted to help dispel any notion to readers that getting arrested for driving under the influence of alcohol for the first time is not a big deal because the recently implemented law allows those arrested to drive if they have this device.

It's an option for first-time offenders who wish to continue to drive.

So far this year, as of April 11, 201 people have opted to have the device installed in their cars, according to state records.

That's out of about 1,700 DUI arrests in 2011, although it's uncertain how many of those were eligible to have the device installed.

But even I wasn't prepared for how disruptive this thing can be to one's lifestyle. Several notes:

» It's hard to blow into. It took me two days to learn the proper technique (stop laughing). I've been late to appointments because I wasn't able to get my car started in time.

Just the past two days, I've gotten used to how to properly let out enough air while humming, so I've been consistent in starting my car.

» It randomly tests you as you drive. I was told the first one is always within 15 minutes. But in the past few days, the despicable device has beeped me for a test within three minutes of me starting the car. Apparently I was given a very needy version of the device.

The device gives you six minutes to pull over and perform the random test. If you don't, you get a violation. Get five violations, and you have 72 hours to take the device back to the vendor for recalibration, or it will lock the ignition.

» Mouthwash will register as a fail, so rinse with water if you gargle. I tested it by giving my mouth a good rinse with some Listerine. I had minty fresh breath, but unfortunately, I couldn't drive my car anywhere. After a fail, you're given 15 minutes before you can try again.

Other embarrassing scenarios I've been in:

» Having to blow while at the drive-through window of a fast-food restaurant.

» Other drivers seeing me blowing as they pass by me.

» Taking forever to get out of a parking stall and having another car wait for me while I'm trying to find the right pitch for the hum.

Did I mention that you have to pay $89 a month plus tax to go through this humiliation?

Next week I'll write about the results of each breath test, maybe post a picture from the camera (that's how it is determined whether you let others blow for you).

If you have the device in your car, email me your funniest or most frustrating experience with it. I promise I won't publish your name.

As for me, I can't wait to get this thing uninstalled on Monday. If you couldn't tell, this assignment really blows.

———

Bankruptcy filings remain at same level

Tue, 05 Apr 2011 06:15:24 GMT

As reported today in PBN:

Hawaii bankruptcy filings hold steady
Pacific Business News
Date: Monday, April 4, 2011, 2:36pm HST
Related: Bankruptcies

Hawaii’s 358 bankruptcy filings in March were up just one from the 357 cases filed a year ago, according to the U.S. Bankruptcy Court, District of Hawaii.
The 271 Chapter 7 bankruptcies filed last month were down 7.5 percent from the 293 filed last year. The 85 Chapter 13 cases filed in March were up 41.7 percent from the 60 cases filed during the same month in 2010. There also were two Chapter 11 cases filed in March, compared to four cases in March 2010, according to PBN research.

Read more: Hawaii bankruptcy filings hold steady | Pacific Business News

Foreclosure fraud - a closer look at a big law firm involved

Sun, 06 Feb 2011 20:10:40 GMT

As reported in the AP on 2/6/11:

The rise and fall of a foreclosure king

By MICHELLE CONLIN, AP Business Writer

FORT LAUDERDALE, Fla. – During the housing crash, it was good to be a foreclosure king. David Stern was Florida's top foreclosure lawyer, and he lived like an oil sheik. He piled up a collection of trophy properties, glided through town in a fleet of six-figure sports cars and, with his bombshell wife, partied on an ocean cruiser the size of a small hotel.
When homeowners fell behind on their mortgages, the banks flocked to "foreclosure mills" like Stern's to push foreclosures through the courts on their behalf. To his megabank clients — Bank of America, Goldman Sachs, GMAC, Citibank and Wells Fargo — Stern was the ultimate Repo Man.
At industry gatherings, Stern bragged in his boyish voice of taking mortgages from the "cradle to the grave." Of the federal government's disastrous homeowner relief plan, which was supposed to keep people from getting evicted, he quipped: "Fortunately, it's failing."
The worse things got for homeowners, the better they got for Stern.
That is, until last fall, when the nation's foreclosure machine blew apart and Stern's gilded world came undone. Within a few months, Stern went from being the subject of a gushing magazine profile to being the subject of a Florida investigation, class-action lawsuits and blogger Schadenfreude that, at last long, the "foreclosure king" was dead.
"What Stern represents is an industry that was completely unrestrained, unchecked, unpunished and unsupervised," says Florida defense attorney Matt Weidner. "This was business gone wild."
The rise and fall of Stern, now 50, provides an inside look at how the foreclosure industry worked in the last decade — and how it fell apart. It also shows how banks, together with their law firms, built a quick-and-dirty foreclosure machine that was designed to take as many houses as fast as possible.
Not long ago, the world of back-office bank procedures was of little interest to the public. But revelations last fall about robo-signers powering through hundreds of foreclosure affidavits a day, without verifying a single sentence, changed all that. Today the banking industry's eviction juggernaut is under intense scrutiny as allegations of systemic foreclosure fraud mount.
The 50 state attorneys general are conducting a foreclosure industry probe. So are state and federal regulators. Class-action lawsuits are gathering force, and, with increasing frequency, state judges are tossing out foreclosure suits in favor of homeowners. The developments are prolonging the housing market depression, casting doubt on mortgage ownership and calling into question whether mortgage-backed securities are, in fact, backed by nothing at all.
The Florida attorney general's economic crimes division is investigating three law firms, including Stern's, over allegations that they created fraudulent legal documents, gouged homeowners with inflated fees, steered business to companies they owned and filed foreclosures without proving the bank actually had a legal interest in the loan. Florida authorities characterize the foreclosure process at these law firms as a "virtual morass" of "fake documents" and depicted Stern's operations as something akin to the TV show "Lost" — only instead of people that went missing, it was paperwork. Stern's employees churned out bogus mortgage assignments, faked signatures, falsified notarizations and foreclosed on people without verifying their identities, the amounts they owed or who owned their loans, according to employee testimony. The attorney general is also looking at whether Stern paid kickbacks to big banks.
"There's a David Stern in every state, sometimes more than one," says Jacksonville Legal Aid attorney April Charney, who has successfully stopped foreclosure for hundreds of Florida families.
Stern denied repeated requests for comment. He did not answer inquiries at his office or at his main residence in Fort Lauderdale. Stern's lawyer, Jeffrey Tew, agreed to an interview in late December at his Miami office, then canceled it the night before without further comment.
Stern's story, starting with his law degree in 1986 from the South Texas College of Law, can be pieced together through thousands of pages of court documents, myriad depositions and scores of interviews.
After working at a law firm for mortgage lenders, Stern started his own practice in Fort Lauderdale in 1994. Four years later, he got a massive break: the mortgage giant Fannie Mae, a government-backed agency that provides market stability for mortgage lenders, named Stern to its exclusive attorney network. That meant Fannie directed banks to use Stern's firm when foreclosing in Florida. Fannie also named Stern Attorney of the Year in 1998 and 1999. Employees from that era remember an office that liked to party together. Stern enjoyed dressing up for his office bashes. One time he sauntered on stage turned out like Michael Jackson.
Almost from the beginning, Stern faced trouble. In 1998, he was named in a class-action lawsuit alleging that he padded fees on foreclosed homeowners. Stern settled for $2.2 million. According to legal testimony at the time from a Fannie Mae official, Fannie was warned about troubles at the Stern firm. But Fannie continued referring cases to Stern. Fannie Mae spokeswoman Amy Bonitatibus says, "At all times, Fannie Mae has had a reasonable expectation that our servicers and the law firms adhere to proper procedures and conduct under the law. In instances where we learn that servicers or law firms are not adhering to our requirements or applicable law, we immediately engage and take appropriate action, which may include termination."
Soon after, Stern was sued again, this time for sexual harassment. A former paralegal alleged that Stern created a "sexually-laden" atmosphere in which he routinely "touched and grabbed and subjected to simulated intercourse" his employees. Stern settled that suit in 2000 for an undisclosed amount.
By this time, lawyers and homeowner activists were also warning lenders, federal regulators and the Florida Bar about Stern. In 2002, the Florida Supreme Court reprimanded Stern for submitting "potentially misleading" fee affidavits.
None of the accusations stalled the firm's steroidal growth. After the economy crashed in the fall of 2008 and ravaged the housing market, Florida, along with Nevada, Arizona and California, became foreclosure central. Stern's caseload rose from 15,000 foreclosures in 2006 to 70,400 in 2009. His staff tripled to more than 1,200. To keep up with demand, Stern set up offices in the Philippines. When the U.S. staff responsible for entering bank data in the foreclosure files logged off, the offshore workers logged on.
Revenue swelled from $41 million in 2006 to $260 million in 2009, according to an SEC filing. The firm moved into a plush, marble-floored headquarters near Miami that was all glass and fountains. By now Stern was driving a Bugatti and had bought at least $60 million in property, including a 16,000-square-foot island compound that sits behind two security gates.
But all the paperwork Stern's firm was cranking out to make this fortune would soon come back to haunt him. The foreclosure business is a volume game. Banks typically pay law firms like Stern's about $1,400 for each successful foreclosure. But the banks can pay a lot less if the firm doesn't successfully foreclose within a certain time frame, usually around six months.
With so many foreclosures flooding in, Stern's firm couldn't keep up. Stern took shortcuts by hiring the young and cheap. "The girls would come out on the floor not knowing what they were doing," says Tammie Lou Kapusta, who worked in Stern's foreclosure department in 2008 and 2009. "Mortgages would get placed in different files. They would get thrown out. There was just no real organization when it came to original documents."
Employee depositions paint a picture of a firm under constant pressure from the banks to move faster. The longer it took to foreclose, the more money the banks stood to lose. Like so many in the industry, Stern had a strategy to cope with all the volume and velocity: robo-signing. One employee testified that Stern's chief lieutenant, a one-time file clerk named Cheryl Samons who rose to become the firm's chief operating officer, signed as many as 1,000 foreclosure affidavits a day without reading a single word. The employee said Samons' hand got so tired that she told three other employees to forge her signature. Samons also signed numerous mortgage assignments with a notary stamp that didn't even exist at the time of signing. Notary stamps are only valid for four years. The only way Samons could have signed mortgage assignments at the time they were supposedly notarized was if she had been capable of time travel.
Stern rewarded Samons with a new BMW SUV every year, paid all her bills and took care of the mortgage payment on her home, according to testimony from two employees. Samons did not respond to request for comment.
Billings surged. So did the dysfunction.
Kapusta testified that she received 100 phone calls a day from people who never received their foreclosure notices or who wanted loan modifications but couldn't get through to the banks. If she talked too long on the phone, Kapusta testified, Samons would yell at her. "Everything was about getting the judgment entered because we had to report to the banks," Kapusta said.
Stern battled to keep the chaos inside his firm a secret. In 2008 and 2009, whenever the Fannie Mae auditors were about to touch down in Miami for their routine monitoring, Stern's employees sometimes toiled through the night, ripping the stickers and client codes off of Fannie files and replacing them with those of a different lender. Then, as an extra precaution, they hauled the disguised files to a remote back room.
Stern then gave Fannie officials the white-glove treatment, with catered meals and chauffeuring. The incomplete files stayed hidden until the auditors left town.
Fannie Mae's Bonitatibus says that, "To our knowledge, no one at Fannie Mae has had their expenses paid by the Stern Law firm."
Early 2010 brought Stern's biggest coup. He spun off a chunk of his business called DJSP that performed mortgage process services like title searches and lien monitoring and took it public. The deal reportedly made Stern $146 million, including $55 million cash.
DJSP stock started trading in January at about $10 a share. Within months, battered by rumors of indiscretions at Stern's firm, it was worth half. On July 20, two investors filed a securities-fraud class action alleging that Stern knowingly misled them by failing to disclose the problems within the business. "DJSP was a scam," says Bill Warner, a Sarasota private eye who successfully defended himself against a foreclosure suit brought by Stern.
At the end of July, Florida attorney Kenneth Trent, who had blocked Stern from foreclosing on a homeowner who was current on his mortgage, filed a federal lawsuit against Stern's firm under a statute normally reserved for gangsters, the Racketeer Influenced and Corrupt Organizations Act--or RICO. Days later, the Florida attorney general launched an investigation against Stern's firm and three other foreclosure mills. The AG's arguments were similar to those brought in Kent's class action.
At first, Stern railed against the media, saying he would defend the company and its reputation against the allegations. Then, in September, he dropped out of sight. Equally elusive is Cheryl Samons, who is no longer with the firm. She left no contact information.
In October, one by one, the megabanks started to withdraw their cases from Stern's firm. Fannie fired Stern on Oct. 22. Stern's staff of 1,200 has dwindled to 200. DJSP's stock, worth as much as $13 in April, now trades for pennies.
The firm's fall has spawned more chaos in Florida's circus-like foreclosure courts. A slew of homes Stern foreclosed on that sold for $240,000 each during the credit bubble sold at auction as orphaned cases for $200. Recently, even the most infamous "rocket docket," in Lee County, where judges were reported to have signed off on a foreclosure every 30 seconds, ground to a virtual standstill as the Stern firm withdrew from case after case. Some of Stern's remaining lawyers show up court with greasy hair, fleece jackets and food-stained clothing. As for Stern, if federal and state prosecutors file criminal charges, he could end up in prison.
Meanwhile, Stern's payment on his $12 million line of credit with Bank of America is late. So is the rent on his headquarters.
He's now in default.

12 steps to improve your credit score

Wed, 26 Jan 2011 17:28:34 GMT

By David Bach:
A 12-Step Action Plan to Improve Your Credit Score
http://www.finishrich.com/blog/a-12-step-action-plan-to-improve-your-credit-score/

A 12-Step Action Plan to Improve Your Credit Score
As seen on AOL’s Walletpop:

Your credit score impacts your ability to get out of debt and stay out of debt. The worse your credit score, the higher the interest rate you will be charged on money you borrow. The better your score, the less your debt will cost you and the quicker you’ll be able to pay it off.

video.aol.com/aolvideo/aol-personal-finance/walletpop-credit-counseling/761256873001

So it’s not only important to know your credit scores from all three major credit rating bureaus — Equifax, TransUnion and Experian — but to know how to raise your score. The simple truth is that raising your credit score isn’t that hard if you know what to do.

Over the years I’ve coached literally thousands of people on how to fix their credit scores, and based off of that experience I have developed a 12-step action plan to raise your score quickly and keep it there. Regardless of where you start from, if you follow this plan and utilize the online tools I discuss — in six months your score will be higher than you ever thought possible.

Step 1: Get Your Credit Report and Check it For Errors

Under the Fair Credit Reporting Act, the Big Three credit bureaus are required to provide every consumer who asks with a free copy of their credit report once a year. You can get yours by going to annualcreditreport.com. This step is important because it is extremely likely there are errors.

A study by the National Association of State Public Interest Research Groups found that one in four credit reports contain a mistake serious enough to keep you from getting a loan, credit card or in some cases a job.

Once you get your report, go through it with a fine-tooth comb. If you find any errors (for example, late payments that were actually paid on time or credit limits that are lower than they should be), get them corrected as quickly as possible. You can do this by sending the credit agency a certified letter that explains what information was inaccurate, including copies of documents (such as bank records) that verify your claim, along with a copy of your credit report with the disputed issue highlighted.

Under the Fair Credit Reporting Act, the credit-reporting agencies are required to correct inaccurate or incomplete information in your report within 30 days. Go to the “Free Stuff” tab at www.finishrich.com to access sample correction letters. Also, go to Finishrich.com and sign up right now and take advantage of the free Debt Wise 30 day trial. By signing up, you will be entitled to a free Equifax Credit Score, so you can see where you stand.

Step 2: Automate Your Bill Paying.

This may be the most important tip. Missing payments or being late on payments can quickly ruin your credit score. For this reason, I strongly recommend that you use your bank’s online bill-paying service to automatically transfer a pre-set amount every month from your checking account to cover at least the minimum payments on all your credit accounts. I have practically every bill of mine automated in this way. You can also use your credit card company online bill payment system to notify you through email when you are close to going over your credit limit, which can help you avoid more damage to your score.

Step 3: If You Have Missed Payments, Get Current.

It’s never too late to clean up your act. Get yourself current as quickly as you can and stay current. Your score will begin to improve within a few months, and the longer you keep it up, the more noticeable the increase will be. The negative weight that FICO gives to bad behavior like delinquencies lessens over time, so as long as you stay on the straight and narrow, those black marks will eventually disappear from your record for good.

Step 4: Keep Your Balance Well Below Your Credit Limit.

Of all the factors you can control — and improve quickly — how much you owe is probably the most powerful. Since the credit crunch, credit card companies have been cutting customers’ credit limits without warning.This can be devastating to your credit score. Say you’ve got a $1,000 balance on a card with a $2,000 limit-and then the card company slashes your limit to $1,000. Suddenly, you’ve gone from 50% credit utilization to being maxed out, which can shave 45 points from your credit score. The credit bureaus recommend that you keep your usage below 33% of your available credit.

Step 5: Beware the Credit Card Transfer Game.

For years, people have saved money by transferring high-interest credit card balances to low-interest cards.This can still be helpful, but be aware that using one credit line to pay off another sets off credit score alarm bells — even if all you’re doing is consolidating your accounts. All other things being equal, your credit score will be higher if you have a bunch of small balances on a number of different cards rather than a big balance on just one or two.

Step 6: If You Rack up High Balances, Pay Your Card Bill Early.

The “Amounts Owed” part of your credit score is based on the balance due listed on your most recent credit card statements. So even if you pay your bills in full each month, running up high balances can still hurt your score. Avoid this problem by paying down all or part of your bill before the end of your statement period, thus reducing the balance that will be reported to FICO and the credit bureaus.

Step 7: Hang On To Your Old Accounts

Part of your credit score is based on how long you have had credit accounts. Closing old accounts shortens your credit history and reduces your total credit — neither of which is good for your credit score. Keep the older accounts open even if you aren’t using them.

Step 8: Use Your Old Cards.

The credit card industry has gotten much stricter about closing inactive accounts. This can hurt your credit score, since it reduces the average age of your credit accounts. To prevent this from happening, you should pull out your old cards and start putting at least one charge on them every month.

Step 9: Demonstrate That You Can Be Responsible.

The best way to raise your credit score is to demonstrate that you can handle credit responsibly — which means not borrowing too much and paying back what you borrow on time. Don’t open new accounts just to increase your available credit or create a better variety of credit. You should open new credit accounts only if and when you need them.

Step 10: Shop For Loans Quickly.

When you apply for a loan, the lender will “run your credit” — that is, send out an inquiry to one of the credit-rating agencies to find out how credit-worthy you are. Too many such inquiries can hurt your FICO score, since it could indicate that you’re trying to borrow money from different sources. Of course, you can also generate a lot of different inquiries by shopping for the best mortgage or auto loan. The FICO scoring system is designed to allow for this by considering the length of time over which a series of inquiries is made. So, try to do all of your loan shopping within 30 days.

Step 11: Know the Difference Between a “Soft Inquiry” and a “Hard Inquiry.”

The credit bureaus all recognize the difference between you checking your own score (a “soft inquiry”) and lenders checking your score (a “hard inquiry”). While too many hard inquiries can lower your score, soft inquiries don’t count at all. Feel free to check your score as often as you want.

Step 12: Buy a 3-and-1 Report And a Credit-Monitoring Package and Identity Theft Service.

Your credit score and credit report are so important that it makes sense to pay for a 3-and-1 Report (which provides you with your credit scores from the three bureaus) as well as an identity theft monitoring service. In most cases, these services will cost you between $14.95 and $19.95 a month — I personally pay for these services myself because I think it’s worth the investment.

Congratulations! You now know more than 95% of all Americans about what may well be the most important influence over your financial life — your credit record and score. Make lifelong monitoring of your credit part of a debt-free lifestyle! For more resources and tools go to finishrich.com.

2011 DUI laws: new ignition lock law effective now

Fri, 31 Dec 2010 23:45:50 GMT

As posted in the StarAdvertiser:

Ignition-lock law on the way
A drunken-driving arrest will require the device be put in cars

By Leila Fujimori

POSTED: 01:30 a.m. HST, Dec 29, 2010

For those ringing in the new year by drinking in the new year, take note: Hawaii's new ignition interlock law takes effect Saturday.

The law will require drivers whose licenses are revoked after a drunk driving arrest to install a breathalyzer in their vehicles that forces drivers to blow into a device.

The device prevents a car from starting if a driver's breath alcohol concentration is .02 or higher -- roughly the equivalent of a single drink.

Hawaii becomes the 48th state with an ignition interlock law aimed at deterring people from driving drunk and decreasing the number of alcohol-related traffic fatalities.

Mothers Against Drunk Driving Hawaii founder Carol McNamee said the law is important because it takes a driver identified as risky off the road and who, without the device, would be able to continue that behavior.

"This makes it impossible for a person with a breath alcohol concentration of .02 to drive and pose a risk to people," she said yesterday.

The National Highway Traffic Safety Administration found the one-year use of an interlock system by DUI offenders reduces recidivism by 50 to 90 percent and alcohol-related traffic deaths by 7 percent. McNamee said the new law is a win-win because it enables drivers arrested for operating a vehicle under the influence of an intoxicant to drive legally sooner. They will be able to continue "driving their families, going to work and doing anything they normally would do if they're sober."

The Department of Transportation held a news conference yesterday in which the state's exclusive interlock device vendor, Smart Start Inc., demonstrated the system at Progressive Auto Sounds in Aiea, one of 12 service centers in the state authorized to install the systems.

Taxpayers are not footing the bill; DUI offenders will pay $84 for installation and a monthly $89 leasing fee.

The state Administrative Driver's License Revocation Office will take away a violator's driver's license and issue a temporary permit indicating the interlock device requirement.

While the new law extends license revocation periods, it also allows most drivers arrested for DUI to continue driving as soon as they obtain an interlock permit.

A first-time offender arrested for drunken driving who blows over the limiit or who refuses to submit to alcohol testing will be subject to a one-year license revocation but may drive with an interlock device.

A two-time offender is subject to an 18-month license revocation; a three-time offender, two years; and an offender with more than three offenses will be subject to five to 10 years' license revocation and will no longer be allowed to drive.

The device is designed to deter tampering. Abram Garcia, operations director for Texas-based Smart Start Inc., said, "We've had incidents where the device was tampered with. It will report any type of tampering."

Tampering with the device, having someone else blow into the device or borrowing someone else's car are all crimes.

Another change to Hawaii law starting Saturday is that refusal to take a breath or blood alcohol test will be a crime, a petty misdemeanor up from an administrative violation.

However, failing the ignition interlock's breath alcohol test is not a crime. Data from the interlock system will be downloaded each time the driver takes the vehicle to a service center for monthly checks. The data will be transmitted to Smart Start's Dallas office.

The company will send it to the state Transportation Department, which will transmit any red-flagged drivers' data to the Administrative Driver's License Revocation Office.

Failure to report for the monthly checks will result in the vehicle's ignition being locked.

Also, failing to take one of two required running retests -- required once a car is started -- will result in the ignition locking after the engine is turned off.

Patrick McPherson, a defense lawyer who specializes in DUI cases and was on the state's task force for the interlock system, said, "I don't think there's a lot of loopholes."

Police Capt. Keith Lima of HPD's Traffic Division said, "It's not new technology. It's just new to us. I think it'll be successful here" where there are 4,000 DUI arrests a year.

Kauai police Lt. Mark Scribner said, "If we can save one life, it'd be worth it."

CORRECTION: Under the ignition interlock law that takes effect Jan. 1, anyone whose license has been revoked for drunken driving will be required to have the device if they want to continue driving. A previous version of this story did not make clear that the law does not automatically apply when there is a drunken driving arrest.

DUI cases: Honolulu Police Officers Charged for Overtime Abuse

Tue, 26 Oct 2010 16:22:57 GMT

KITV reports today, 10/26/10:

Six Accused Officers Plead Not Guilty

HONOLULU -- Seven Honolulu police officers are charged with falsifying police paperwork to gain more overtime for their superiors in the Honolulu Police Department’s DUI unit.
Attorneys for the accused officers went to court on the officers’ behalf Monday, to answer the charges.
Two sergeants and five officers are charged in the case.
They all work in the Traffic Division's DUI unit, which conducts roadblocks on O’ahu roadways.
Sources told KITV4, police officials believe the overtime abuses date back to August 2009.
HPD launched an internal investigation earlier this year, after it discovered the potential overtime abuses.
Attorney Thomas Otake, who represents one of the seven officers charged said prosecution is not meant to be made with broad strokes.
“I believe it’s become sort of a witch hunt where it’s a guilty by association approach. They all work together. They’re all part of this division. And I believe they charged almost all of them,” said Otake, who represents Officer Leighton Kato.
According to the prosecutor's office all seven officers are charged with tampering with a government record, for knowingly making a false entry in that record. The officers charged are Sgt. Aaron Bernal, Officer Christopher Bugarin, Officer Patrick Bugarin, Officer Leighton Kato, Officer Michael Krekel, Officer Brian Morris and Sgt. Duke Zoller.
Bernal and Zoller are also charged with third-degree theft by deception.
In July, sources told KITV the sergeants who oversaw police DUI checkpoints were being investigated for claiming overtime when they were not on the job.
Sources also said officers who worked under the sergeants were suspected of falsifying police reports by claiming the sergeants were at DUI checkpoints when they were not.
Police Chief Louis Kealoha was out of town Monday and unavailable for comment.
But in July, Kealoha made a brief comment on the investigation.
“We don’t want this investigation to taint the good work that our police officers are doing out there. It’s a concern to us, but it’s not going to severely impact our ability to find DUIs,” Kealoha said.
The prosecutor's office has so far dismissed at least 12 DUI cases that were being handled by the officers charged in the overtime case.
HPD said the seven officers are still on the job, although they have been reassigned and their police powers are restricted.
If convicted of the misdemeanors, the officers face up to 30 days in prison and a fine of up to $1,000.

Honolulu Police Officers Charged In Overtime Abuse Case - Honolulu News Story - KITV Honolulu

Incoming Prosecutor Kaneshiro Firing 11 Lawyers

Wed, 06 Oct 2010 17:18:08 GMT

Incoming city prosecutor Keith Kaneshiro is firing 10 percent of the lawyers in the Honolulu city prosecutor's office, including some of the most experienced prosecutors on the staff.
A total of 11 attorneys found out Tuesday that they would be out of jobs as of Monday, the day Kaneshiro is sworn in as prosecutor.
All of the city's 105 deputy prosecutors serve at the pleasure of the city prosecutor, so he can hire and fire whomever he wants for whatever reason.
One defense attorney who’s a former deputy city prosecutor said Kaneshiro fired some top career prosecutors because they supported his opponent in the election.
Deputy Prosecutor Michelle Puu was in the middle of jury selection in a robbery trial Tuesday when she got word that she will be terminated Monday, forcing a three-week delay in the trial.
"It was bizarre that this would happen right as the trial was starting, my defendant was there and we were going to go forward with the trial," said Jeffrey Hawk, the criminal defense attorney in the robbery trial.
A seven-year veteran, Puu has about 40 felony trials pending and even those who've opposed her in the courtroom say she's top-notch.
"I've worked with Michelle for years and she's a good prosecutor and I was a little surprised she was let go," Hawk said.
Kaneshiro is also firing Kevin Takata, a deputy prosecutor for 23 years, who's head of the felony trials division. He has more murder convictions than any other lawyer in the office -- and is prosecuting the case of Adam Mau, who's charged with the murder of three people at the Tantalus Lookout.
Mau's defense attorney, Brook Hart, had this reaction: "I'm disappointed that they're being let go because they represented the highest ideals in prosecutorial activity."
Hart wonders how well cases will be handled with the abrupt firings of 11 deputy city prosecutors who are in the middle of trials and investigations.
"It's probably disruptive in any professional environment to, in effect, change horses mid stream," he added.
Kaneshiro's spokeswoman, Lynne Waters, said he “looked carefully at every attorney in the office before making the decision” about which ones to retain on his staff.
But sources in the prosecutor's office said Kaneshiro met with none of those he fired and they asked how he could evaluate someone fully without ever having met some of them.
Kaneshiro’s campaign asked deputy prosecutors who were interested in remaining on the staff to submit a “letter of interest” to his campaign by last Friday, Oct. 1, according to an e-mail received by the prosecutor’s office. That means Kaneshiro would have had less than four days, including the weekend, to decide which attorneys he wanted to keep on his staff. Kaneshiro e-mailed the prosecutor’s office with the list of the lawyers who will not keep their jobs around 10 a.m. Tuesday morning.
Kaneshiro was not available for an interview Tuesday night, his spokeswoman said.
Criminal defense attorney Myles Breiner said he was one of 13 deputy prosecutors fired by Kaneshiro back when Kaneshiro was first elected prosecutor in 1988. Breiner was in the middle of a murder trial at the time he got the news he’d lost his job, he said.
"He terminated anyone who apparently had any sympathy for his opponent," Breiner said, noting those fired 22 years ago had campaigned for then-incumbent prosecutor Charles Marsland, who lost to Kaneshiro in the 1988 prosecutor’s race.
Breiner claims many of the prosecutors fired this week are people who supported Don Pacarro, one of Kaneshiro's opponents in the special election.
"Yes, I think it's politically motivated," Breiner said. “This is a pattern. He’s a vindictive person.”
Pacarro, who is a deputy prosecutor, is not on the list of 11 people Kaneshiro plans to terminate. So for now, Kaneshiro appears to be keeping his former opponent on the staff.
One of the deputy prosecutors being terminated has been on disability leave for more than a year, sources told KITV 4 News.
Kaneshiro's spokeswoman says he has six experienced deputy prosecutors ready to replace some of those being terminated Monday, including three veterans who've served in the office before and a fourth lawyer with “significant litigation experience.”
“He will have a fully-competent team in place,” said Waters. “He is confident all active investigations and trials will be handled with competent, professional people.”
When Mayor-elect Peter Carlisle took over as city prosecutor from Kaneshiro in 1997, he allowed all deputy prosecutors to remain on the staff for a number of months in a probationary period before deciding which lawyers should remain on his staff, employees in the prosecutor's office said.

Presenting @ NBI Consumer Bankruptcy Basics seminar on Oct. 14, 2010 in Honolulu

Wed, 22 Sep 2010 06:07:12 GMT

Aloha! I am looking forward to presenting 2 topics (chapter 13 procedure, basics & ethics) at the NBI Consumer Bankruptcy Basics seminar on October 14, 2010 in Honolulu.

For more information, including available credit for continuing education, please check:

http://www.nbi-sems.com/Enbi/Brochurepdfs/51980.pdf?ctname=fac_1010_NBI_s&type=faculty&woys=37&year=2010

I look forward to seeing you there!

VLO-Virtual Law Office and its creation by Stephanie Kimbro

Fri, 10 Sep 2010 16:53:26 GMT

Meet the Solo Who Wrote the Book on Virtual Law Practice PROFILE
POSTED SEP 9, 2010, 06:20 AM CDT BY STEPHANIE FRANCIS WARD

Stephanie Kimbro
See video below

View Wilmington, N.C.

Stephanie Kimbro was pregnant with her first child and thought a sole practice doing estate planning from home would be a good way to combine a job and parenting. What she didn’t realize was that in five years, she’d earn more working from home than she did as a law firm associate.

Kimbro, 34 and owner of Kimbro Legal Services, estimates her operating costs are about $140 a month: $100 for her software service and $40 for a wireless card.

“I just wanted to be able to stay home with my daughter, and I thought this would be a way to do that until we figured out how I could stay home,” says the Wilmington, N.C., lawyer, noting the financial realities many young families face when weighing how much money they need to live on versus child care arrangements they desire.

Kimbro’s husband, Benjamin Norman, is a computer programmer, and while she was pregnant the two developed a website to serve clients online. What they came up with was a secure, Web-based interface that has importing and exporting capacities.

She opened her practice in January 2006, the same month her daughter, Madeleine, was born.

“The first month she’d be in my lap while I’m working on the computer. As she got more mobile, it got more tricky,” says Kimbro, who now also has a son, William, not yet 2. “I’d start working at 1 a.m., or getting up earlier than she was.”

Many of Kimbro’s clients are also mothers with young children, and she discovered they were often online when she was.

The first year was somewhat rough, Kimbro says, in terms of getting clients. She found that traditional advertising didn’t accomplish much.

She shifted marketing efforts to numerous e-mail discussion lists and social networking sites like LinkedIn, Facebook and Twitter, allowing her to interact with other lawyers without sharing an office with them. “I’m way more social now than I was working in a small firm,” she says.

She also developed a presence on local parenting message boards. Her signature line includes “mom of William and Madeleine, owner of Kimbro Legal Services.”

“If someone did have a legal issue, if it was something I could do—I would be called on,” says Kimbro, who works on North Carolina matters only.

She started to see a steady stream of business after one year. Today, much of her work comes from client referrals. The bulk is estate planning, which she unbundles. For wills, she charges $150 per person. For a couple purchasing an estate planning package, the price is $500. The packages include standardized forms and memos, Kimbro says, but her work is personalized through discussions with clients, usually online.

Besides trust and estate work, Kimbro handles small-business matters like incorporation and contract drafting.

“I provide each prospective online client with a price quote for fixed-fee services based on the complexity of their matter,” she says. “I sometimes will do a fixed fee for a portion of the work and then move to billable-hour rates if it exceeds the scope of that initial project.”

Prospective online clients click to accept Kimbro’s price quote along with a click-wrap agreement that defines the scope of representation.

“She’s got a really interesting vision for how law practice can change, and how you can offer it in ways that haven’t been offered before,” says Eric Mazzone, director of the North Carolina Bar Association’s Center for Practice Management. “She has a unique way of looking at a situation and seeing things that others don’t.”

But they’re starting to. In October 2009, the software system she and her husband designed, Virtual Law Office Technology, was sold to Total Attorneys for an undisclosed amount. Total Attorneys hired Norman as a senior developer and bestowed the title of “evangelist” on Kimbro, who in addition to her law practice does consulting work for Total Attorneys. The Chicago-based company is a technology service provider that focuses on small-firm and solo law practice management.

“I’m educating the profession about ways to encourage innovation in delivering online legal services, not sell a company or product,” Kimbro says. “Even when they have me do a webinar for Total Attorneys, I do not specifically plug their products and include many different providers and options for the listeners.”

Kimbro adds, “In 10 years I think every firm is going to have to have some form of a virtual component. Consumers are not going to go to traditional law firms, and if solos want to stay competitive, they have to have some form of virtual offerings if the clients request it.”

http://www.legalrebels.com/posts/meet_the_solo_who_wrote_the_book_on_virtual_law_practice/la

The Economist reports: Bankruptcies on the Rise

Thu, 19 Aug 2010 18:05:37 GMT

Bankruptcies
Going for broke
Bankruptcies rise in America
Aug 18th 2010

BANKRUPTCY filings rose 20% in the year to June 30th compared with the previous 12-month period, according to statistics released on August 17th by the Administrative Office of the US Courts. This takes quarterly filings to their highest point since tougher bankruptcy laws were introduced at the end of 2005. That change brought a spike of bankruptcies, as companies and individuals rushed to declare themselves broke under the more lenient old regime. The data suggest that an older trend is reasserting itself. This is could be more bad news for America—or it could just mean that creative destruction is alive and well.

More Daily charts

http://www.economist.com/node/16843119?story_id=16843119&fsrc=rss&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+economist%2Fnews_analysis_and_views+%28The+Economist%3A+News+analysis+and+views%29

Condo associations often foreclose on condos before the lender does--"to minimize losses"

Sun, 01 Aug 2010 19:23:19 GMT

Foreclosures hurt condos
Many face higher fees as some owners fail to pay

By Rob Perez
Some foreclosed condos are selling for $1 at the nonjudicial auctions held at noon Fridays outside the Circuit Court building.

The foreclosure mess spreading through Hawaii's housing market is hitting condo projects especially hard, contributing to depressed property values and forcing many associations to raise monthly maintenance fees.

Some foreclosed condos are selling for $1 at auction—less than the price of a Costco hot dog and soda.

"It's like being in a madhouse, and things are happening and you don't know why," said attorney John Morris, whose law firm represents dozens of condo associations, including some that have purchased units in their projects for $1 at so-called nonjudicial foreclosure auctions.

Although residential foreclosures represent only a fraction of Hawaii's overall condo inventory, their numbers are growing and the fallout is causing major budget problems for many projects already facing steep increases in maintenance, utility, insurance and other bills, according to real estate professionals and condo owners.

"I've never seen it this bad," said Hawaii First Inc. President Richard Emery, who has been managing isle condo properties for more than 20 years. His company oversees nearly 200 projects statewide.

The foreclosure crisis is especially worrisome, real estate officials say, because Hawaii has the highest concentration of homes in condo and community associations of any state in the country. Roughly 30 percent of Hawaii's housing stock is in such associations, according to state and federal data.

While no one compiles reliable condo foreclosure statistics, anecdotal evidence suggests the problem is widespread, affecting low-end and upscale properties, especially those with a high percentage of investor-owners.

RealtyTrac, a real estate research firm, last week reported that home foreclosures in Honolulu jumped 72 percent in the first half of the year, compared with the same period a year earlier. It didn't break out condo statistics. Honolulu's rate of one foreclosure for every 121 homes was the 112th highest ratio of 204 cities surveyed.

Adding to the growing foreclosure problem are financially strapped condo owners who have mounting delinquent maintenance fees but are not yet in foreclosure.

Many projects are seeing a surge in such delinquencies, even though the associations have the authority to foreclose on homeowners because of unpaid fees. Sometimes just starting the foreclosure process is enough to get homeowners to work out a resolution.

Attorneys and property managers who represent condo associations say most projects are struggling to find ways to offset foreclosure-related budget shortfalls, deferring maintenance, raiding reserve accounts or increasing monthly fees, essentially making the paying homeowners pay more.

"If all owners don't contribute their share, then their neighbors are left holding the bag," said attorney Bryson Chow, whose firm is handling about a dozen recently advertised nonjudicial auctions for the 400-unit Palm Court in Ewa Beach.

Some projects have raised fees by double-digit percentages or are planning to do so in the next budget cycle. When fees are increased, more homeowners tend to fall behind because of the higher payments, putting additional pressure on condo boards to raise fees again. That can trigger a snowball effect.

"Foreclosures are the No. 1 issue," said attorney Chris Goodwin, who represents 88 condo associations, half of which have raised fees—some as much as 30 percent—because of the delinquency problem. "At 90 percent of our projects, that will be the only issue discussed."

At one Maui beachfront project, which has a lot of mainland investor-owners, roughly 25 percent of the units are in foreclosure, according to Emery, the Hawaii First president. The foreclosure problem has been a factor in home prices there falling about 50 percent since 2008, he added.

Emery, like others who talked to the newspaper, didn't want to identify their projects facing foreclosure problems, partly out of concern that the unflattering publicity might exacerbate the situation.

Many of the mainland investor-owners in the Maui project walked away from their units because the homes were "under water," a term used when a property is worth less than what is owed on the mortgage.

The majority of condo units statewide that went into foreclosure over the past year likely were under water, real estate professionals say.

To help offset the Maui project's budget shortfall, the association approved a special assessment, adding $200 to the homeowners' monthly fee of about $700, Emery said. Because of the property's continuing financial predicament, bankruptcy is being discussed as a potential option, he added.

"You just can't keep raising fees," Emery said.

The foreclosure crisis in Hawaii's condo world has hit especially hard because of the timing. Many projects, built in the late 1960s or 1970s, are at an age when major renovations, such as costly structural repairs, are needed. Yet just when the money is needed to do the work, more homeowners are not paying their bills, the condo groups say.

Although some owners say Hawaii's nonjudicial process is unfair because homes can be sold relatively quickly without adequate due process, condo associations generally have a different take.

From their perspective, the foreclosures can't happen quick enough.

While some nonjudicial cases can be completed within 90 days, others last months, with each delay adding to the delinquency tab, according to condo groups. Some cases aren't resolved for a year or two.

"When it drags out, we get hurt," said attorney Jane Sugimura, president of the Hawaii Council of Associations of Apartment Owners. Like other association representatives, Sugimura would like to see the nonjudicial process happen quicker.

A state task force is examining the process to recommend to the Legislature whether changes are needed.

Condo associations in Hawaii were given the authority in the late 1990s to use the nonjudicial process, which occurs without court oversight. But they didn't start aggressively using it until the last few years.

Some condo attorneys, such as Pamela Schell, prefer to do judicial foreclosures, even though they take longer and cost more.

"We like the court oversight," Schell said. "The court is going to make sure everything is fair."

For some associations, though, nonjudicial is the only way to go. One reason is price.

In a phenomenon unique to this downturn, associations have purchased foreclosed units for $1, according to attorney Morris.

In a judicial process, the court likely would not agree that $1 represents fair market value, Morris and others said.

When condo groups foreclose on units that are under water, no one other than the association typically will bid at the auction because of the negative equity of the homes.

In a nonjudicial process, the association usually bids $1 to get ownership and, after making repairs, rents the foreclosed condo to a short-term tenant. Until the lender initiates its own foreclosure action to take back the home, the association is able to generate revenue from a property that otherwise would be a financial drain.

But because the association may be unable to recoup its costs before the lender claims the property, purchasing a unit for even $1 is a gamble, Morris said. "It's like rolling the dice in Las Vegas," he said.

Property appraisers say one or two $1 sales in a given project wouldn't affect property values. But if enough happened to establish a trend, values likely would suffer, they said.

While other attorneys who do nonjudicial cases say condo associations usually benefit when they purchase foreclosed units, Morris is more skeptical.

"Most of the time it ends in disaster," he said. "The best we can do is minimize the screwing."

Foreclosure Fraud Defendant Gets Six Years

Fri, 30 Jul 2010 17:13:35 GMT

Foreclosure Fraud Defendant Gets Six Years

John Mendoza Continues To Deny Wrongdoing

Daryl Huff KITV 4 News Reporter
POSTED: 4:37 pm HST July 29, 2010
UPDATED: 9:37 pm HST July 29, 2010

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Comments (9)

HONOLULU --

A man who prosecutors say used religion to lure victims into a mortgage fraud scheme was sentenced to prison Thursday.
John Mendoza, 59, was sentenced to six years behind bar. That's not enough says a woman who said she was lured into one of his deals, which he still claims were intended to save homes for people facing foreclosure.
"The only thing I can call this person is that he is a monster,” said Laura Cristo, who said Mendoza ingratiated himself by coming to her Waianae restaurant and praying with her and her family.
“Once he gets your confidence then boom, he starts talking about his stuff,” said Cristo. She said Mendoza offered her an investment opportunity, in which she agreed to take out a mortgage on a house owned by a person Mendoza told her needed help to avoid default.
Federal prosecutor Clare Connors said Mendoza would talk distressed homeowners into selling their property in paper to his friends, on the promise they’d be able to buy the home back. Instead, Connors said, Mendoza kept hundreds of thousands in profits from refinancing the homes.
Connors said Mendoza won the victims' confidence with his smooth charm and professions of religious faith.
“The victims in this case were also religious people who fell victim in part because of the religious approach Mr. Mendoza had with them,” Connors said.
In court Thursday, Mendoza repeatedly mentioned his faith as he proclaimed his innocence and said he was only trying to help people. But U.S. District Judge Michael Seabright said the evidence was clear that Mendoza had used his faith to sucker in his victims, and then suck away the equity in their homes.
“Mr. Mendoza operated with a clean intent to defraud, to benefit himself and hurt others.” Seabright said. “He used religion to spot and hood vulnerable victims.”
Despite his harsh words, Seabright sentenced Mendoza to the lower-end of federal guidelines. Mendoza will spend six years in prison. There is no parole in the federal system. After prison he will serve five years supervised release and must pay $881,514.98 in restitution to the former homeowners, one of whom recently died of cancer.
The sentence was much less than the prosecutor asked for and disappointed Cristo. “It was shameful it was so little time, you know, in comparison to all the wrongdoing that he's been performing out here,” Cristo said.
Mendoza told the court he plans to fire his publicly funded attorney and file an appeal. He complained that his attorney didn’t understand the sophisticated real estate transactions involved in the case. The judge replied that while the individual transactions may have been complex, taken as a whole, the jury correctly determined Mendoza’s intent was to steal the equity in the two homes and leave homeowners devastated.

Foreclosure Fraud Defendant Gets Six Years - Honolulu News Story - KITV Honolulu

Don't file bankruptcy without an attorney

Wed, 28 Jul 2010 17:25:03 GMT

See this interesting article by Adrian Lapas on the Bankruptcy Law Network:

I Can’t Afford A Bankruptcy Lawyer–Do I Really Need One?
by Adrian Lapas, Eastern North Carolina Bankruptcy Attorney · Posted in *Bankruptcy Information
You are thinking that you may need to file bankruptcy but you are concerned that you do not have the money for a bankruptcy lawyer. You are wondering whether you can afford to pay a qualified attorney to handle your case for you. Perhaps the better question is–can you afford not to!

Just recently, I learned of a person in my district who filed a bankruptcy case without the assistance of a lawyer. This person used a bankruptcy petition preparer from out-of-state to assist in completing the paperwork. Once the paperwork was filed with the court, the case started to unravel immediately. This person was going through a divorce and, in order to obtain possession of the house, borrowed money from a relative to pay the other spouse. This loan was secured by a deed of trust on the marital home. However, because the deed of trust was recorded within just a few days of the bankruptcy filing, the trustee’s position was that the lien on the house could be set aside as a pre-petition preference. Of course, the bankruptcy petition preparer is unable to offer assistance (and cannot as that would be practicing law without a license). The trustee is asking the bankruptcy court for permission to sell the house in order to pay creditors.

The above scenario is, no doubt, not what the debtor wanted out of bankruptcy! So, how could an experienced bankruptcy attorney have made a difference? By getting a full view of the debtor’s financial picture, obtaining relevant documents to ensure that security interests are properly perfected and by knowing what the debtor’s goals are in a bankruptcy case. The lawyer cannot always accomplish those goals (most likely, such goals are unrealistic) but can certainly work to avoid what appears to be actually happening, that is, loss of debtor’s home.

The Bankruptcy Code is a complicated federal statute. It often involves technical terms and rules of practice that are unfamiliar and foreign to other attorneys who do not practice bankruptcy law. If other attorneys find it somewhat confusing and mystifying, it is far more so to non-attorneys trying to handle their own case.

It is well worth your time and money to have an experienced bankruptcy attorney help you through this process. I am sure that the debtor in the case above has found that trying to save money by not hiring a bankruptcy lawyer has proven to be a false economy. If you think that you can’t afford a bankruptcy attorney, you really can’t afford not to.

Problems with Hawaii (non-judicial) foreclosures--bankruptcy as an option to stop foreclosure

Sun, 25 Jul 2010 19:41:44 GMT

As the Star Advertiser article makes clear, there are substantial problems with non-judicial foreclosures in Hawaii. One major problem is that the lenders - and their local attorneys - are not able (or willing?) to provide current information to the homeowners about the status of a foreclosure. While homeowners are applying for and lenders considering loan modifications, it is almost impossible to receive a written confirmation whether a looming foreclosure date has been postponed or remains as scheduled. Especially if a lawsuit is not pending, i.e., there are not yet attorneys involved on both sides, it is next to impossible to communicate with lenders in an effort to resolve issues and to determine whether a loan modification is possible.

One alternative is to consult with a bankruptcy attorney. While some homeowners are trying to defend against a foreclosure lawsuit, these lawsuits are costly and rarely successful. Lenders are very aware though, that the filing of a bankruptcy petition would stop the foreclosure and buy the homeowners substantially more time. Of course, the homeowners do not necessarily have to file a bankruptcy petition, but frequently using a bankruptcy attorney helps with the loan modification. And if homeowners qualify for bankruptcy, a chapter 13 bankruptcy might provide the homeowners with the additional 3-5 years they need to catch up on missed payments so that at the end of the bankruptcy, the homeowners are current on their mortgage again.

Here is the article:

Foreclosures
Hawaii law seen as helping lenders, hurting consumers
By Rob Perez

POSTED: 01:30 a.m. HST, Jul 25, 2010

See the differences between judicial and non-judicial foreclosure process here:
http://media.staradvertiser.com/images/300*322/20100725_newsCHARThome.jpg

Waikele homeowners Laureto Gaspar and his wife, Arnida, recalled the shock of the notice of foreclosure on their home while standing on their front porch Friday. The Gaspars' home was sold at a non-judicial foreclosure auction in April even though they say they have never missed a mortgage payment.
More Photos

The vast majority of residential foreclosures being conducted in Hawaii are proceeding under a state law that is more than a century old, provides no court oversight and is widely panned by consumer advocates for failing to adequately safeguard the rights of homeowners.

One expert who has analyzed foreclosure laws nationally says Hawaii's 1874 law is among the weakest in the country, partly because it allows a home to be sold relatively quickly without safeguards common in other states.

"It's one of the most lacking in protections of all the laws," said Geoff Walsh, staff attorney for the Massachusetts-based National Consumer Law Center, which last year published a study of state foreclosure laws. Walsh was co-author of the report.

Hawaii's 136-year-old statute allowing so-called non-judicial foreclosures is under increased scrutiny because it has become the predominant method of choice for lenders—mostly national—seeking to do forced sales as homeowners struggle in a sluggish economy.

A task force created by the Legislature this year is scheduled to meet for the first time Tuesday to begin evaluating whether changes are needed, especially in the non-judicial arena.

Many homeowners facing foreclosure have complained that they are being treated unfairly, including some who say they have received foreclosure notices even though they aren't behind on their mortgage payments. The non-judicial process, they add, leaves them at the mercy of their mainland lenders with no defense short of filing a costly lawsuit to try to stop a sale.

HOMES LOST

While no one keeps accurate data on non-judicial foreclosures, the sharp rise in foreclosures is reflected below in the number of judicial foreclosures (residential and commercial):
2005: 315
2006: 461
2007: 721
2008: 1,379
2009: 1,829

Source: Hawaii Judiciary

Although no data are available on how frequently non-judicial foreclosures are occurring in the islands, industry officials estimate that eight or nine of every 10 residential foreclosures are happening via the 1874 law. The others take place in the courts, with a judge overseeing the process.

No independent oversight occurs during the non-judicial process, which enables a lender to foreclose on a Hawaii home in as little as two and a half months. A court-supervised process generally takes about eight to 13 months to complete.

The problem with the non-judicial system, critics say, is that the 1874 law is too vague, allowing national lenders handling huge volumes of loans to pursue foreclosures.

Lender representatives and other industry executives defend the system, saying it provides homeowners with sufficient due process, costs less than the court-supervised route and helps borrowers wanting to quickly get out from unaffordable financial quagmires.

"There are some situations when a quicker process benefits all parties," said foreclosure attorney Marvin S.C. Dang, who represents lenders.

Auctions can be postponed if red flags arise, and lenders would rather work out a resolution than force a sale, industry officials say.

They also note that the cases with problems represent only a tiny percentage of the total number of foreclosures.

"For the most part, the concept of non-judicial foreclosures is itself not a problem," Dang said. "If things need to be fixed, we can fix the way the process works as opposed to getting rid of the process—because it does work."

Don't tell that to Arnida Gaspar.

The Waikele resident said she and her husband, Laureto, were shocked when they received a loan-default notice, then a foreclosure notice in January from their lender, Bank of America. They were surprised, Gaspar said, because the couple had not missed any payments on their townhouse. The notice said the property was to be sold at a non-judicial auction in March.

When the Gaspars called to clear up the problem, they were told by the bank that they could apply for a loan modification, that their home would not be sold in the meantime and that they shouldn't worry, according to court papers filed in a lawsuit by the couple's attorney, Gary Dubin.

Yet their home was sold at auction April 22 for $184,000—25 percent less than what it was assessed by the city, the documents show. The Gaspars still are in the home.

But Arnida Gaspar, 56, a food services worker at a Waipahu elementary school, is worried about losing the residence she and her husband have owned since 1991. "I can no longer eat," she said. "I have no appetite."

Lanai homeowner Stephen Cheikes, also a BofA customer, can sympathize with Gaspar.

Cheikes, an attorney, said he found a foreclosure notice posted on his property even though he had worked out a permanent loan modification agreement with the bank last year and was current with his payments.

He said he has been trying unsuccessfully since December to straighten out what several bank representatives admitted to him was an error on BofA's part. A recent notice from the bank indicated that his home would be sold at auction Aug. 9.

"It's absolutely ridiculous," Cheikes said. "It's been a nightmare trying to undo the bank's mistake."

Jumana Bauwens, a BofA spokeswoman, said, "We're going to reach out to both customers to see what their concerns are and see what we can do to try to keep them in their homes if that's possible."

She declined further comment, citing the pending litigation in the Gaspar case and that the bank is doing more research on the Cheikes case.

Recognizing problems with the 1874 law, the state Legislature in 1998 passed a bill establishing an alternative process for non-judicial foreclosures. The new process, which took effect in 1999, had more stringent requirements to address concerns about due process and the vagueness of the 1874 system.

But several provisions that lenders consider unworkable were added to the 1998 legislation, effectively undermining the effort to improve non-judicial foreclosures. The result: No lender uses the alternative process.

Before the late 1990s, almost all home foreclosures in Hawaii were done through the court system. That changed when title companies, which previously were reluctant to issue title insurance in non-judicial cases, worked with lenders to implement homeowner-protection measures not specifically required by the 1874 law.

The lenders, for instance, agreed to have the foreclosure notices personally served on the borrower or delivered via certified mail, with signatures required to prove receipt. Lenders also agreed to give up the right to pursue deficiency judgments against a borrower even if the foreclosure proceeds didn't satisfy the outstanding mortgage debt.

In exchange for agreeing to such conditions, some of which were incorporated into the 1998 legislation, the lenders were able to use the fast-track process pegged to the 1874 law.

But even some of those safeguards are falling by the wayside today because mainland lenders are able to find title companies that no longer impose the conditions, industry officials say.

Big Island consumer attorney George Zweibel said the non-judicial process is so defective that homeowners have even fewer rights than renters in Hawaii.

When a landlord wants to take back an apartment from a tenant, the landlord has to go to court and get a judge to approve the request, based on an evaluation of the evidence. Not so with non-judicial foreclosures, Zweibel said.

"This process allows lenders to take people's homes in a fast way without giving them an opportunity to be heard," he said. "In many cases, the homeowners have done nothing wrong."

Hawaii is one of 30 states that permit non-judicial foreclosures, according to Walsh, the consumer law center attorney.

Although the center's study panned the non-judicial system overall for depriving homeowners of basic protections, Walsh said Hawaii's 1874 law is particularly lacking. Once the foreclosure process starts, for instance, the Hawaii homeowner does not have the right to cure the default, something common in other states, Walsh said.

"It makes it really difficult to stop the foreclosure sale while (the process) is going on," he said.

To be sure, many homeowners lose their homes because they bought residences they clearly couldn't afford or accumulated way too much debt from overspending. But others struggle to pay their mortgages because of job losses, major illness, predatory lending or other financial hardships generally outside their control.

Dubin, who represents the Gaspars, said unwarranted foreclosures are depressing Hawaii property values, affecting all homeowners, not just those struggling to make loan payments.

"It's a financial disaster, and it's also creating an enormous amount of emotional distress," he said.

Given the far-reaching effects of the foreclosure problem, Dubin is seeking to have the Gaspar case certified as a class-action lawsuit on behalf of those who have lost their homes through the non-judicial process since 2006 or those currently in foreclosure.

"We've got to do something," Dubin said. "This situation has gotten completely out of control."

Carlisle Resigns As Honolulu Prosecutor

Thu, 22 Jul 2010 06:14:58 GMT

Carlisle Resigns As Honolulu Prosecutor

Law Enforcement Officer To Run For Honolulu Mayor

HONOLULU -- Honolulu Prosecuting Attorney Peter Carlisle turned in his letter of resignation Wednesday to the Honolulu City Clerk's office.
Carlisle's resignation became effective at 4:30 p.m. Wednesday.
Doug Chin, Carlisle's former deputy, has stepped in to serve as acting prosecutor until a new prosecutor is elected.
Carlisle is resigning as prosecutor to run for Honolulu mayor to fill out the remaining two years in the term of Mufi Hannemann who resigned Tuesday to run for Hawaii governor.
Carlisle will officially file to run for mayor after the Honolulu City Council Thursday sets a date for the special mayoral election. The special election will be either in the Hawaii's Primary September 18, or in the November 2 General Election.
Besides Carlisle, other mayoral candidates include current Honolulu acting mayor Kirk Caldwell, Councilmen Donovan Dela Cruz and Rod Tam, and University of Hawaii engineering professor Panos Prevedouros.
Carlisle resigns after 14 years of running the Honolulu Prosecutor's Office. He prosecuted several high-profile cases, including Xerox shooter Byron Uyesugi and Matthew Higa who thew a toddler to his death off Honolulu's H-1 Freeway.
Carlisle said his accomplishments include modernizing prosecutor's office and watching Oahu crime drop dramatically from 59,000 the year he became prosecutor to 30,000 to 35,000 crimes a year.
Carlisle said for the last three years Honolulu has been the safest city of its size in the United States.
Carlisle said after years of trying, his proudest accomplishment was urging Hawaii lawmakers to approve a constitutional amendment to allow voters to approve "information charging."
Information charging offers the option of charging a suspect by information from documents rather than requiring witnesses and police officers to appear before a Grand Jury or to show up at preliminary hearings.
Carlisle said information charging has changed the lives of tens of thousands of witnesses and police officers by sparing them court appearances.
Carlisle brings high name recognition to the mayors race after his 14 years in the public eye as prosecutor.
"That is a huge advantage and frankly it is reflected in the polling," said Carlisle.
In his mayoral campaign, Carlisle said he will stress the executive experience he's gained running the prosecutor's office.
Carlisle's resignation to run for mayor sets off another special election to fill out the remainder of his prosecutor's term..
Council members will also decide Thursday when to hold the special election for prosecutor.

Carlisle Resigns As Honolulu Prosecutor - Honolulu News Story - KITV Honolulu

Should you file a business bankruptcy?

Wed, 21 Jul 2010 16:58:55 GMT

Informative article posted on the Bankruptcy Law Network:

Is Bankruptcy the Right Option For My Business?
by Douglas Jacobs, California Bankruptcy Attorney · Posted in business

Filing bankruptcy for your business can end the frustration and stress of trying to keep the “doors open” on a failing endeavor. But is it necessary?

If you have a sole proprietorship, you can’t file bankruptcy just for the business without including all of your personal assets and debts. That may be a good thing, and will give you a “fresh start” so you can get on with your life. After the bankruptcy, all of your debts; both personal and business; that can be discharged will be gone.

On the other hand, a Corporation or a Limited Liability Company (LLC) are separate entities and filing bankruptcy for that kind of business won’t involve your personal assets or debts.

So, should you file bankruptcy?

First of all, you probably wouldn’t be thinking about this if your business was doing well. The economy has taken its toll on everything from personal debt to what were once thriving small businesses. When your Corporation or LLC fails there are several things you can do:

1. You can simply close the doors and walk away. The state will consider the business “inactive” and eventually you will have abandoned the name and entity.

2. You can properly dissolve the entity by notifying the state, selling any assets and using the money to pay creditors a pro-rata share.

3. You can file bankruptcy. The court will appoint a trustee who will take charge of gathering the business assets, selling them and distributing the proceeds appropriately.

Which is best? It really depends on the type of creditors you have and what you intend to do in the future.

If you want to continue to work in the same industry as the business, either by yourself or as an employee, than I don’t recommend the first option. It will leave your customers and creditors with a bad taste in their mouth. And they will probably find you to demand some answers

Thus, the choice often comes down to the 2nd and 3rd options: dissolution or bankruptcy. Dissolution means you and your employees do the work. You are responsible to gather receivables, sell assets, and distribute the funds. In a bankruptcy, the trustee will do all of that, albeit she will need a lot of information and a little help from you.

Dissolution is generally less expensive than bankruptcy. If you do the paperwork yourself for filing with the state the costs are nominal. Even hiring an attorney to dissolve the Corporation or LLC is much less expensive than a small business bankruptcy.

But, sometimes it’s worth the cost to just turn the whole business over to the trustee in bankruptcy and let your attorney and her work it out. And you can get on with your life. And, I have found that often creditors are quicker to give up trying to collect a debt when there was a bankruptcy. Without it, some creditors just won’t understand that a dissolved entity means they can’t come after the owner.

These are tough decisions. A lot depends on individual circumstances. Whatever you decide to do, you need a good attorney to guide you through the process.