Tuesday, May 14, 2013

Ex- Homeowner Who Lost Home To Foreclosure Nearly 20 Years Ago Discovers He May Be Victim Of Recently-Revealed NYC Surplus-Snatching Scam

In Brooklyn, New York, WNYC News reports:

  • William Easterling and his wife used to own 165 Forbell Street, a two-family home in Brooklyn on the border of Cypress Hills and Ozone Park. The couple raised their four kids there. But they haven’t lived there in almost 20 years.

    Easterling had been violently mugged on his way to work in 1992 and his wife said, "enough." They moved. But his troubles didn't end there. He had to file for bankruptcy and was forced to surrender the Brooklyn property.

    What he didn't know was that his old property was listed in the indictment against Senator John Sampson, who's accused of keeping money that came from the foreclosure sale.

    He also didn’t know that years ago he may have had a right to claim some of the $80,000 Sampson reported from the sale of 165 Forbell Street.

    “Otherwise I would have the attorney looking into it with all the money I had to spend, plus with the money I lost in the home,” he said. “But I had no idea, no.”

    Sampson is accused of embezzling $440,000 from the foreclosure sales of four properties. In each case, he was appointed by the courts to serve as the referee. In that role, he was overseeing the foreclosure auction and making sure that any surplus funds were returned to the Kings County clerk for disbursement. Sampson is accused of keeping that money for himself. He has pleaded not guilty to the charges.

    Josh Zinner, co-director of NEDAP, a nonprofit that works on economic justice issues, says the extra money from foreclosure sales often represents the families' leftover equity — and possibly their only source of wealth after they had lost their homes in foreclosure.

    Easterling thinks someone should have told him there was money out there owed to him.

    “I'm 70 years old, okay. I wasn't born yesterday. I mean I look in the mirror and I don't think I look that stupid,” he said. “If I should have been owed something, I feel like it should have been up to the court to inform me.”

    A spokesman for the Office of Court Administration admitted there is no system in place to make sure referees actually deposit surplus funds from a foreclosure sale to families. And, technically, it wasn't up to the court to notify Easterling.

    Even if Easterling had known he should claim it, prosecutors are saying, the money wasn't there to give. Sampson allegedly kept it.(1)
Source: Sampson Corruption Scandal Hits Home for One Family.

(1) According to the indictment, by helping himself to the surplus proceeds, Sampson, an attorney, allegedly violated a fiduciary duty to the Brooklyn Supreme Court. If true, and if the funds ultimately cannot be recovered, and assuming that only licensed attorneys can act as court-appointed referees in New York, it may be that the violation of this duty may be enough to enable the court, as well as the ultimate victims (ex-homeowners and subordinate lien holders of the four foreclosed homes) to recover some or all of the pilfered proceeds from The Lawyers’ Fund For Client Protection Of the State of New York, the state's attorney ripoff reimbursement fund.

For information on "attorney ripoff reimbursement funds" in other states and Canada, see:

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