They say this will make teachers more "professional" and bring much-needed business practices to education.
Meanwhile in the real world, here is what business practices have brought us:
MIAMI — All she wanted was $50,000 from the equity in her house to help pay the bills while looking for a job in nursing. What Imogene Hall got was a brutal lesson in the sometimes shady ways of the mortgage industry.
It's a lesson learned by untold numbers of homeowners in Florida, epicenter of the foreclosure crisis gripping the nation.
"Everywhere I turn, someone else is scamming me,'' said Hall, a 49-year-old Jamaican immigrant who stands to lose her Miami Gardens home the Monday after Thanksgiving. "All I do is work hard, and I get surrounded by thieves.''
A review of court records found evidence of misconduct at nearly every stage of Hall's experience. Consider:
_ Johnson Cuffy, a former mortgage broker now serving an 11-year prison sentence for grand theft, handled Hall's refinancing in early 2006, using a strategy a state investigator described as ``outright mortgage fraud.'' He faces up to 30 more years in prison if convicted of 16 other mortgage fraud charges he's facing.
_ The title agent who signed the crucial deed transfers that Hall's fraud claim rests on operated an unlicensed title company that stole more than $1.5 million from South Florida home buyers during closing proceedings between 2005 and 2007, according to Florida Supreme Court records.
_ A man who listed his employer as a nonexistent Blockbuster Video store in New York somehow used Hall's home as collateral to secure a $230,000 loan from subprime lender Argent Mortgage.
_ Hall's foreclosure was processed by the Florida Default Law Group, one of four Florida law firms being investigated by the state attorney general for using flawed documents to repossess homes from thousands of owners.
QUICKIE OUTCOME
After spending more than three years in the judicial system, Hall's case was transferred to Miami-Dade's County Court's new foreclosure-only division in July. There, Judge Jeffrey Rosinek, who was fresh to the case, quickly tossed out Hall's fraud defense, and granted the bank a swift summary judgment in a process critics describe as a "rocket docket.''
Hall's foreclosure defense lawyers, in what has become a booming -- and sometimes predatory -- business, charged her more than $20,000 while regularly failing to show up in court. One lawyer charged Hall $2,800 for work he did trying to withdraw himself from the case.
Law enforcement officers are scheduled to come to Hall's house to evict her and her family next week, nearly five years after a mortgage broker showed up on her doorstep unannounced, pitching a stress-free refinance.
Hall, who lives in the modest home with four children and three grandchildren, says her troubles began in late 2005 when she was struggling to find work as a home health nursing aide. As her bills piled up, she considered tapping into the equity she had built in her three-bedroom home. The market was booming, and homeowners all around her were using equity to take vacations, remodel kitchens and pay down consumer debt.
She says she received an unsolicited visit from Cuffy, manager of BlueKap Financial Group, who promised to handle a refinance and help her get $50,000 equity out of her home.
According to state investigators, Cuffy's strategy was steeped in fraud. In a scheme he allegedly used multiple times in South Florida, he recruited a ``straw buyer'' -- someone with no real intention of occupying the property -- to take deed to Hall's home. He then used an inflated appraisal and the straw buyer's credit information to take out a $230,000 mortgage before transferring the deed back to Hall.
The Miami-Dade County property appraiser had valued the home at just under $132,000 the year before the loan was taken out.
$25,000 FEE
Closing documents from the sale show that Cuffy and his affiliates made more than $25,000 in transaction fees, and pocketed more than $180,000 from subprime lender Argent Mortgage Company, without Hall's knowledge, she says. Hall received the balance of the $230,000 loan -- about $50,000 -- the proceeds of what she thought was a simple refinance.
R. Scott Palmer, the attorney general's Mortgage Fraud Task Force chief, said similar mortgage fraud schemes were prevalent during the boom years as fraudsters looked to take advantage of a rising market and unsuspecting homeowners.
"They preyed on people who had equity in their homes that they could strip, and what you described happened to this person has happened to a lot of people,'' he said.
John Swope, a Department of Financial Services agent who has been investigating Cuffy and his entourage for the last three years, said the mortgage fraud ring made millions of dollars in Florida real estate transactions that closely mirrored Hall's.
"The loan is never anticipated to be paid back,'' he said. "Unfortunately, I've had people who have become homeless because of this individual.''
Others involved in the sale -- closing agent O.J. Odunna, title issuing company Organized Title and BlueKap affiliate Cliff Johnson -- have all been either charged or convicted by law enforcement officials of mortgage-related offenses in other South Florida cases.
Unlike most homeowners fighting foreclosures, Hall claims she had been making her mortgage payments when she received a default notice from the bank. At the urging of Cuffy, she made monthly mortgage payments of $1,500 to Tamarac-based BlueKap Financial, but the money was never used to pay the lender, she said.
Court records show that BlueKap sent her bogus receipts each month indicating ``mortgage paid,'' but a few days after receiving her eighth receipt, she got a letter from Argent Mortgage saying the lender intended to foreclose on her home.
"None of the money I gave [Cuffy] went to pay the mortgage,'' said Hall, whose monthly mortgage bill more than doubled after the refinance. ``Such a wicked man. He did nothing but lie to me.''
Cuffy is currently serving an 11-year stint for grand theft, and faces a host of mortgage fraud charges, along with family members who helped him run the now-defunct BlueKap. Swope said the company targeted homeowners who were in distress.
GUY FROM NEW YORK
His alleged straw buyer, Kervyn Harris, is a prime example of how easy it was to get a home loan during the housing boom as money moved fast and due diligence was often scarce in banks' loan origination departments. Harris, of New York, ran up a quick $1.3 million bank tab in South Florida with five different mortgage loans in an eight-week period between Dec. 8, 2005 and Feb. 1, 2006.
Although his mortgage applications listed a job at a nonexistent Blockbuster Video in New York, he had no trouble getting $230,000 in loans from Argent Mortgage for Hall's Miami Gardens house. All of the homes Harris bought during his spree -- each at inflated prices and with subprime financing -- immediately went into foreclosure, court records show. He is listed as the borrower and main defendant in Hall's foreclosure case, but has never been to any of the court hearings. He could not be reached for comment, and the Department of Financial Services wants to reach him for questioning, Swope said.
In a case where mortgage fraud is alleged and the victims include both the lender and the homesteaded property owner, foreclosure court proceedings between those two parties are especially complex.
Deutsche Bank, a trustee representing Argent Mortgage in Hall's foreclosure, has denied knowledge of any fraud in court, claiming that it is entitled to recoup the lender's losses. A Deutsche spokesman said the bank does not comment on individual cases.
Deutsche Bank is a trustee for several lenders and it became the trustee for Hall's loan after it acquired a pool of loans that included hers, in 2006.
Jonathan Heller, a defense lawyer representing a Miami homeowner who is facing foreclosure and claiming mortgage fraud, said banks are generally determined to foreclose in spite of evidence of fraud, and judges are too overwhelmed with huge case backlogs to consider complicated defenses.
LARGE VOLUME
``These cases are handled in large volume -- and the majority of them are pro forma -- but many of the files are tinged with fraud and irregularities,'' he said. ``The court simply does not have the time to hear the grievances of a homeowner raising fraud issues, which are fairly prevalent.''
Hall's court hearings started in 2006 -- before the tsunami of defaulting loans flooded the court systems -- and lawyers sparred over the legitimacy of the loan for more than three years. In the early stages of Hall's foreclosure proceedings, Judge Ronald Friedman prevented the lender from closing the case on multiple occasions, pointing out irregularities and allowing Hall to mount a legal defense.
But lingering case-files like Hall's have become the bane of the Miami-Dade court system as it has amassed the largest foreclosure backlog in the state and new filings have poured in faster than judges can close out old cases.
In July, armed with $862,053 in state funding, Miami-Dade initiated sweeping changes to the way it handled foreclosures. The funding came with strings attached: the county was expected to clear out 52,000 cases in a year -- about 200 per day -- more than have ever been solved in such a short span of time. Miami-Dade's backlog currently stands at about 70,000 cases. The number is about 39,000 in Broward County and nearly 3,000 in Monroe County.
The reform measures included the creation of Section 50, a floating courtroom designed specifically to take on foreclosure cases that were more than two years old, and make them quickly disappear.
Hall's foreclosure case-file was transferred to Section 50 in July.
A new judge, called back from retirement, made quick work of the proceedings in August, approving the foreclosure in the type of swift hearing that many have criticized as a ``rocket docket'' that favors lenders. Between July and September, some 46,940 foreclosure cases in Florida were decided by summary judgment, according to the Office of State Courts Administration. Only 23 cases in the entire state went to trial.
Hall claims that during her 15-minute hearing, the judge did not allow her or her lawyer to get in a word.
``The first judge was so nice -- helping me, helping me,'' Hall said. ``Then they [transferred] my case, and the second judge wouldn't listen to anything. He just said `You're going to lose the house, you're going to lose the house.' ''
BAD TO WORSE
Hall has had even worse luck with her legal representation along the way. Foreclosure defense is a growing business in Florida, where hundreds of thousands of homeowners are facing the prospect of losing their most valuable asset. Many are turning to lawyers and foreclosure rescue agencies.
Hall paid her first lawyer, Alan Soven, more than $10,000 to fight the foreclosure. At one point Judge Friedman rebuked the Miami lawyer for subpar legal work, and the Florida Bar ordered him to refund $2,000 in legal fees to Hall in a mediation settlement. With a $400 hourly rate, he charged Hall nearly $3,000 for the 7.2 hours he spent trying to get legal approval to quit the case, court records show.
Soven declined to comment on the case.
Hall's next lawyer, Johnny Kincaide of The Kincaide Law Group in Weston, routinely skipped crucial court hearings and failed to file a response to a court ruling, causing the judge to penalize Hall with an order of default. Kincaide's firm is being investigated by Attorney General Bill McCollum after several homeowners said he promised to help them get a mortgage modification and then disappeared after taking their initial deposits. He did not return calls seeking comment.
The unlikely common denominator for all of this is a humble home on a quiet side-street in Miami Gardens, where Hall has lived for 13 years. She paid just over $80,000 for the home in 1997. Despite overwhelming evidence that Hall was likely a victim of mortgage fraud, Deutsche Bank won its foreclosure case, with a final judgment of $303,000 for the home, which the county appraiser valued at $98,310 this year.
Hall, who grows emotional when she talks about what now appears to be an inevitable eviction, says losing her home would be a devastating end to what has been a nightmarish ordeal.
``I can't sleep at night -- I worry, worry, worry about where I'm going to go,'' she said. ``I looked for help but nobody wanted to help me. I don't know what I'm going to do.''
Key quote - "Everywhere I turn, someone else is scamming me."
I know the feeling.
God help this woman and her family.
I'm not a religious sort, but I do hope if there is something akin to John Bunyan's hell, all the people who scammed Hall spend some time in it.
And the same goes for Gates, Duncan, Friedman, and all of the others who have conducted this concerted effort to destroy public education and the teaching profession.
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