Terry Rosenberg, a veteran Miami, Florida real estate lawyer, was sanctioned by a judge in December in connection with a foreclosure case. The judge’s order was included in a state bar petition to the Florida Supreme Court seeking an emergency suspension of Rosenberg’s law license. On January 3, 2005, the court upheld the emergency suspension – which Rosenberg is appealing. The Florida Legislature has now introduced a bill – the details to be worked out in committee – to stop the conduct in which Mr. Rosenberg is alleged to have engaged.
He is accused of a scheme involving obtaining surplus foreclosure funds from the courts. Apparently, after foreclosure, prior homeowners often cannot be located. Due to rapidly rising real estate prices, there are often funds remaining after payment of the lender and other creditors. Some businesses charge a hefty commission to help former property owners locate and obtain such surplus funds. Mr. Rosenberg represented many homeowners in obtaining post-forclosure surplus.
But, there’s a twist. Manual Rosado Sr. and his son, Manual Rosado Jr, both non-lawyers would search property records and locate properties with surplus funds and turn the information over to Rosenberg. Rosenberg would apply for and obtain the funds. According to the article, there were no contracts with the former owner at the time that Rosenberg applied for release of the surplus. Once he obtained release of the funds, Rosenberg would issue a check to himself, a check to the Rosados and a check to the former property owner. According to the state bar, at least 18 of the checks to former property owners were actually cashed by Rosado Jr. Property owners who later appeared to claim the funds from the court learned that Rosenberg had obtained release of the funds and complained.