For a while, we’ve been hearing about fraudulent mortgage paperwork being rampant — across different banks, across different parts of the country — including forged documents, but without any specific details about the forgery allegations.

That started to change last week, with reports of a sworn statement to the Florida attorney general by an ex-employee of what is described as Florida’s largest “foreclosure mill”.

A former paralegal with Florida’s largest foreclosure law practice has told state investigators that the firm routinely signed court paperwork without reading it, misdated records, forged signatures and passed around notary stamps in the rush to foreclose on homes.

“This is just the beginning really,” the paralegal, Tammie Lou Kapusta, told ABCNews.com. “It’s the tip of an extreme iceberg.”

The allegations are the latest leveled against the firm of multimillionaire attorney David J. Stern…
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The paralegal, who worked for Stern a little more than a year, described an office where signatures on notarized documents were regularly forged, legal papers were outsourced to Guam and the Philippines, and shouting matches erupted when cases stalled.
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Across the nation, mortgage-servicers, which include units of major banks such as Bank of America Corp., have been accused of submitting fraudulent documents in thousands of foreclosure proceedings.

In Florida, Stern is foreclosure king, operating the large law firm plus a foreclosure processing company and other support businesses that he recently sold off.

His Plantation, Fla., firm, which filed 70,382 foreclosure cases last year, is the largest of three under investigation by state Attorney General Bill McCollum for allegedly filing improper documents with courts to hasten the overloaded foreclosure process.
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Notary stamps were always available, and employees such as Kapusta, who were not notaries, routinely used them on official documents, she said. Those who could best fake the signature of the person who verified foreclosure affidavits were allegedly sought out to forge her name.
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The paralegal, who worked for Stern a little more than a year, described an office where signatures on notarized documents were regularly forged, legal papers were outsourced to Guam and the Philippines, and shouting matches erupted when cases stalled.

Stern’s lawyer, Jeffrey Tew, naturally, denied all these allegations:

Tew dismissed Kapusta’s allegations as simply untrue, the rants of a disgruntled former employee.

But, sure enough, Kapusta’s “tip of an extreme iceberg” prediction has been borne out. Two more ex-employees have stepped forward with sworn statements that support Kapusta’s testimony. And it’s looking a hell of a lot worse than it did last week:

Some employees of Florida’s largest “foreclosure mill” were given jewelry, cars and houses from the firm, in exchange for altering and forging key documents used to obtain foreclosures, according to a statement released today by the Florida Attorney General’s Office.

The office released transcripts of two interviews it conducted for its investigation into the law offices of David J. Stern. The sworn statements were from Kelly Scott, a former employee of Stern’s and Mary R. Cordova, a former employee of G&Z, a process server used by Stern’s office. The women’s testimonies appear to back up that of former Stern’s employee (sic) Tammie Lou Kapusta, whose statement was released last week. The three statements paint a picture of a secret system designed to speed up the foreclosure process. Attorneys and staff members forged signatures, changed dates, passed around notary stamps, the women say in interviews with attorney general’s staff.

The two former Sterns employees described long tables where employees would sign as a witness and notarize documents without actually witnessing the signing. Twice a day, Scott said, the company’s chief operating officer, Cheryl Samons (sic; the name is apparently Salmons), would go into the office and sign 500 documents at a time “ without reading them.

Scott was Samons’ (sic) legal assistant.

As a perk of Samons’ (sic) job, Stern’s office would routinely pay her personal mortgage, a car payment, her electric bills and her cell phone bill, according to Scott, who told investigators Stern also bought Samons (sic) a new BMW sport utility vehicle every year and gave her and other employees jewelry. Additionally, Stern purchased employee David Vargas a house, a car and a cell phone, Scott claims in her statement.

Scott said the office would move forward with cases, even if they knew the homeowner had not been properly notified of the lawsuit.

Fannie Mae and Freddie Mac were Stern’s “babies,” Scott said, and they routinely questioned documents and came to the office to check files. Last week Freddie and Fannie said they would audit Stern’s files.

Someone inside both organizations would tip Sterns off to the visits, and Stern’s staff would then alter client codes and hide files, according to Scott’s statement. When Fannie and Freddie employees left, they’d bring the files back out. The other witness, Cordova, worked at G&Z for two months. The firm, which handled service for various foreclosure law firms, had special instructions for Stern, the firm’s main client, according to Cordova’s statement.

Every file was billed for at least four people to be served with the foreclosure paperwork, even if the firm knew there weren’t that many people with interest in the property. These bills were sent out before the parties were served and, often, Cordova said, the company didn’t follow through with the service.

Long tables where attorneys and staff members forged signatures, changed dates, passed around notary stamps sounds like the very definition of an assembly line operation for producing fraudulent paperwork.

And, to borrow Sammy Sosa’s phrase (from the year his steroid-assisted home-run-record chase propelled him to national prominence), such business practices have been very very good to Stern. How good? He owns not just a $15 million house in Fort Lauderdale, but also a $20 million yacht. Funny story about the yacht:

The 50-year-old Stern even considered naming his $20-million yacht “Su Casa Es Mi Casa – “Your House is My House,” an acquaintance told the New York Times. After his wife and others reportedly cautioned against it, Stern settled on Misunderstood. He denied to the newspaper that he considered “Su Casa Es Mi Casa.”

And the house is something else too:

His 16,000-square-foot mansion, valued at more than $15 million, occupies a corner lot in a private island community on the Atlantic Intracoastal Waterway in Fort Lauderdale, according to the New York Times and Mother Jones magazine.

The mansion is featured on a water-taxi tour of the area’s grandest estates, including the homes of Jay Leno and billionaire Blockbuster founder Wayne Huizenga, and the former residence of Desi Arnaz and Lucille Ball. In addition to the 130-foot yacht, Stern reportedly has an automobile collection that includes a 2008 Bugatti and multiple Ferraris, Porsches and Mercedes. But Tew declined to discuss his client’s assets. “All that does is feed into this scenario that somehow they’re taking advantage of poor people who are losing their houses and getting rich off of it,” he said. “You could say the same thing about a neurosurgeon that makes millions of dollars a year from people who sustained terrible head injuries.”

You could, indeed. Except that neurosurgeons earn their money for treating those people who sustained terrible head injuries, for helping them with their injuries. You really think there’s much moral equivalence between that, and suborning and rewarding perjury, forgery and fraud to improperly get people thrown out of their homes, do you, Mr. Tew?

In fact, the behavior of David J. Stern seems to fit the very stereotype of the wicked, crooked lawyer who abandons every moral compunction to cut corners in the single-minded pursuit of obscene levels of personal wealth.

Tew says “it’s really wrong to vilify him”. He almost gets it right. By the sworn testimony of his ex-employees, it’s really impossible to vilify him.