A tipster (send in your tips here) just let me know about the Chapter 7 bankruptcy filing of Philip Kramer, of Kramer & Kaslow fame. Kramer was at the heart of the mass joinder, sue your lender craze that the State of California shutdown.
Philip Kramer listed about 4,000 individual creditors in his filing and wound up disclosing the names of consumers that most likely bought into his failed mass joinder scheme and collectively lost potentially millions.
According to the California Bar, Philip Kramer still is active to practice law but has recently received an order on 2-17-2012 to become inactive to practice. – Source
Kramer’s bankruptcy filing on February 8, 2012 was grossly incomplete and the court has ordered him to submit a significant amount of information within 14 days.
What we can learn from his barebones filing is his assets are between $500,001 to $1 million and his liabilities are between $100,001 to $500,000. That’s odd. Based on that information he should be able to liquidate his assets to cover his liabilities. Kramer says the debts included are primarily business debts.
There must be critical information in the missing schedules that would make this bankruptcy filing seem more reasonable.
According to the petition filed, Philip Kramer says he has been unemployed for the entire 60-day period prior to the date of his bankruptcy petition.
Looks like Kramer called in a favor because his lawyer, who is also named as a creditor, has agreed to prepare the bankruptcy petition, schedules, and appear at creditors meeting for free. – Source
The California Attorney General had this to say about Kramer’s mass joinder enterprise:
Kramer’s firm and other defendants were placed into receivership on Monday, Aug. 15. The legal actions were designed to shut down a scheme operated by attorneys and their marketing partners, in which defendants used false and misleading representations to induce thousands of homeowners into joining the mass joinder lawsuits against their mortgage lenders. Defendants also had their assets seized and were enjoined from continuing their operations. Nineteen DOJ special agents participated as the firms were taken over Wednesday, Aug. 17, along with 42 agents and other personnel from HUD’s Office of Inspector General, the California State Bar, and the Office of Receiver Thomas McNamara at 14 locations in Los Angeles and Orange Counties. Sixteen bank accounts were seized.
“The defendants in this case fraudulently promised to win prompt mortgage relief for millions of vulnerable homeowners across the country,” said Attorney General Harris. “Innocent people, already battered by the housing crisis, were targeted for fraud in their moment of distress.”
“The number of lawyers who have tried to take advantage of distressed homeowners in these tough economic times is nothing short of shocking,” said State Bar President William Hebert. “By taking over the practices of four attorneys accused of fraudulent marketing practices, the State Bar can put a stop to their deplorable conduct as part of our ongoing effort to protect the public.”
It is believed that at least two million pieces of mail were sent out by defendants to victims in at least 17 states. Defendants’ revenue from this scam is estimated to be in the millions of dollars.
As alleged in the lawsuit, defendants preyed on desperate homeowners facing foreclosure by selling them participation as plaintiffs in mass joinder lawsuits against mortgage lenders. Defendants deceptively led homeowners to believe that by joining these lawsuits, they would stop pending foreclosures, reduce their loan balances or interest rates, obtain money damages, and even receive title to their homes free and clear of their existing mortgage. Defendants charged homeowners retainer fees of up to $10,000 to join as plaintiffs to a mass joinder lawsuit against their lender or loan servicer. – Source
Sadly this follows a pattern that repeats over and over again when debt relief enterprises fail.