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Law BlogLegal Blog on immigration, bankruptcy, family law (divorce, annulment and legal separation), personal injury, real estate, wills and estate matters.enWed, 29 Apr 2026 20:43:11 -04002210Jeffrey B. PeltzArea of LawReal EstateMortgage FraudCan you imagine claiming that you and your family are destitute and even homeless and at the same time claiming that you are wealthy and getting millions in mortgages? That is exactly what 15 people are accused of. In fact, 12 of them were members of the same family. Today the U.S. attorney in...Fri, 14 Nov 2014 00:00:00 -0500Can you imagine claiming that you and your family are destitute and even homeless and at the same time claiming that you are wealthy and getting millions in mortgages? That is exactly what 15 people are accused of. In fact, 12 of them were members of the same family. Today the <a href="http://www.nytimes.com/2014/11/14/nyregion/15-charged-with-defrauding-banks-and-lenders-of-20-million.html?ref=nyregion" target="_blank">U.S. attorney</a> in Manhattan, Preet Bharara, charged these 15, including a lawyer and appraiser with defrauding banks of $20 million over the last 10 ye ars while at the same time collection Medicaid and food stamps. Although this is an unusually brazen example of mortgage fraud, it is hardly the only recent example. Other examples include: <a href="http://www.nytimes.com/2014/11/14/nyregion/15-charged-with-defrauding-banks-and-lenders-of-20-million.html?ref=nyregion" target="_blank">Steve Weinstock</a>, a Long Island attorney that was arrested for allegedly stealing $720,000 from his escrow account. In addition he sold a property owned by his law firm and then kept the money for his personal use. <a href="http://mortgagefraudblog.com/man-arrested-posing-real-estate-agent-stealing-payments/" target="_blank">Andrew Daniel</a>, 48, of Brentwood, NY who posed as a real estate agent and was arrested for allegedly stealing nearly $200,000 in down payments on properties. In this case Mr. Daniel claimed to have negotiated the sale of 49 distressed properties to an investor in Queens, NY. As it turns out, many of the properties were not distressed and the down payments were deposited into his personal account. <a href="http://mortgagefraudblog.com/businessman-gets-16-year-prison-sentence-bogus-real-estate-investments/" target="_blank">Mohammed Rafikian</a>, 54 from Queens, N.Y. was recently sentenced to 16 to 50 years in prison for stealing $5,000,000. Among the frauds that Mr. Rafikian committed was falsely posing as an attorney. He stole from a cardiologist, a dentist, a bar manager, a retired disabled elevator mechanic, a NYCHA inspector, a painting contractor, and even a family friend. <a href="http://mortgagefraudblog.com/woman-jailed-using-forged-check-pay-mortgage/" target="_blank">Melanie Ferreira</a>, 62 year from Lagrangeville, New York was recently sentenced to 51 months in prison for a series of frauds. Among the frauds that she committed were paying off the mortgage on her Dutchess County home with a forged cashier’s check. Later when the bank found out about the forged check, she then tried to pay off the same mortgage with a check on a closed account. She also repeatedly filed false tax returns and requested large refunds. After receiving a tax refund of $440,924 the IRS caught on to the fraud. <a href="http://mortgagefraudblog.com/man-arrested-stealing-title-new-york-home/" target="_blank">Darrell Beatty</a>, 49 year from Queens, New York has been charged with literally stealing a house from an elderly woman. Mr. Beatty, realizing that the house was not lived in, allegedly created a bogus deed to the house and recorded it. He then moved into the vacant house. The victim became suspicious when she noticed that the water bill, which was being mailed to her residence, was larger than usual. <a href="https://www.fbi.gov/buffalo/press-releases/2013/buffalo-man-charged-with-mortgage-fraud" target="_blank">Michael Rory Woods</a>, 44, from Buffalo, who worked as a mortgage broker, is charged with allegedly inflating the income of James P. Vasiliou, Jr. in an application to refinance his mortgage. By the way, Mr. Vasiliou had previously pleaded guilty to bank fraud in connection with making a false statement on a prior mortgage application. In this matter, the alleged actions of Mr. Woods caused the approval of the refinance application and resulted in a loss to JP Morgan Chase, which held the mortgage. Although these examples of mortgage fraud all took place in New York, mortgage fraud occurs <a href="https://www.fanniemae.com/content/fact_sheet/mortgage-fraud-statistics-1014.pdf" target="_blank">throughout the U.S.</a> In my opinion, this is a crime that hasn’t been taken seriously enough in the past. In fact you can even say that such crimes contributed to the <a href="https://en.wikipedia.org/wiki/Financial_crisis_of_2007%E2%80%9308" target="_blank">financial crisis of 2007 – 2008</a>. Hopefully, we as a society have learned from our recent history and will now enforce the law.2231Jeffrey B. PeltzArea of LawReal EstateNew York Looking to Deal wtih Zombie HousesNew York State Attorney General Eric Schneiderman is seeking to hold banks responsible in maintaining the State’s growing number of “zombie properties” - homes that have been vacated by homeowners in advance of completed foreclosures. New York State in particular has been severely plagued with...Thu, 06 Mar 2014 00:00:00 -0500New York State Attorney General Eric Schneiderman is seeking to <a style="font-style: inherit; font-weight: inherit;" href="http://online.wsj.com/news/articles/SB10001424052702304104504579374791891832978">hold banks responsible</a> in maintaining the State’s growing number of “zombie properties” - homes that have been vacated by homeowners in advance of completed foreclosures. New York State in particular has been severely plagued with zombie properties since the housing market crashed in 2007. Over <a style="font-style: inherit; font-weight: inherit;" href="http://webcache.googleusercontent.com/search?q=cache:EL0vohBV50EJ:https://www.facebook.com/eric.schneiderman+&cd=1&hl=en&ct=clnk&gl=us">15,000</a> “zombie properties” are littered across New York, nearly 20% of the total foreclosed properties in the state. The abandoned properties fall into disrepair, leaving no one responsible for regular maintenance and upkeep. The open vacancy attracts vagrants and squatters, causing an increase in vandalism, crime, and decay. The deteriorating houses create a dangerous environment for local residents and burden local law enforcement officials who are not equipped to handle the sudden increase in crime, leading to a decrease in property value of the surrounding neighborhood. When banks send foreclosure notices to families who have fallen behind on their mortgage payments, homeowners often abandon the property prematurely. They are unaware that they have the right to stay inside their homes until a full foreclosure has been declared by a judge. This process could take an extended period of time. In New York State, a foreclosure may take close to <a style="font-style: inherit; font-weight: inherit;" href="http://www.nytimes.com/2014/02/10/nyregion/a-new-effort-in-albany-to-put-lenders-in-charge-of-abandoned-properties.html?_r=1">3 years to complete</a> - the longest amount of time required by any state. Furthermore, since the foreclosing banks are legally required to maintain the property after the foreclosure has been completed, the State Attorney General has found <a style="font-style: inherit; font-weight: inherit;" href="http://ag.ny.gov/press-release/ag-schneiderman-announces-statewide-results-homeowner-protection-program-first-15">evidence</a> that banks often delay the process even further in order to avoid responsibility on houses that are difficult to sell. The <a style="font-style: inherit; font-weight: inherit;" href="http://www.nytimes.com/2014/02/10/nyregion/a-new-effort-in-albany-to-put-lenders-in-charge-of-abandoned-properties.html?_r=1">developing legislation</a> outlined by the Attorney General would hold the lending banks responsible for the properties shortly after they have been abandoned. The law would allow the state to define what constitutes as an abandoned property and require the banks to maintain the premises immediately - closing the loophole of waiting until the end of a delayed foreclosure process. Banks would be required to notify delinquent homeowners that they have the right to continue living in their homes until a judge has declared the foreclosure official. It would also create a statewide database for the location of the zombie properties. Should the bill pass, banks will be fined a potential $1,000 for every day an abandoned property goes unregistered and under-maintained. Attorney General Schneiderman is also proposing a <a style="font-style: inherit; font-weight: inherit;" href="http://www.ag.ny.gov/feature/land-bank-community-revitalization">separate bill</a> that would increase funding and double the amount of land banks available in New York State. Land banks are nonprofit organizations funded by the state that pay to restore vacant properties. Mr. Schneiderman has championed other statewide initiatives that seeks to prevent the rapid spread of the “zombie house” epidemic. The Attorney General’s office has committed $60 million to help struggling New York families with financial and legal counseling regarding their mortgages. The <a style="font-style: inherit; font-weight: inherit;" href="http://www.nysmortgagesettlement.com/hopp.html">“Homeowner Protection Program”</a> (HOPP) advocates on the homeowner’s behalf, fills out all necessary paperwork and documentation, and negotiates more affordable loan modifications. The program has helped <a style="font-style: inherit; font-weight: inherit;" href="http://ag.ny.gov/press-release/ag-schneiderman-announces-statewide-results-homeowner-protection-program-first-15">over 23,000</a> homeowners avoid foreclosure and lower their monthly payments. The housing market crash has left millions of families struggling with unaffordable monthly payments on their high priced loans. “Zombie Properties” are detrimental to a housing market still struggling to recover. Derelict properties affects the surrounding neighborhood, decreasing the property value of houses that have already been hurt by the mortgage crisis. I applaud the efforts of Attorney General Eric Schneiderman. I encourage you to call your local councilman and voice your support for the developing bill.2234Jeffrey B. PeltzArea of LawReal EstateForgiven Mortgage Debt is Now TaxedThe housing market crash of 2007 left millions of families with mortgages that were in excess of the plummeting values of their homes. Many families opted to negotiate selling the property through a short sale. A short sale is a negotiated agreement between the lender and the borrower to sell the...Tue, 25 Feb 2014 00:00:00 -0500The housing market crash of 2007 left millions of families with <a style="font-style: inherit; font-weight: inherit;" href="http://www.corelogic.com/about-us/news/corelogic-reports-791,000-more-residential-properties-return-to-positive-equity-in-third-quarter-of-2013.aspx">mortgages that were in excess of the plummeting</a> values of their homes. Many families opted to negotiate selling the property through a <a style="font-style: inherit; font-weight: inherit;" href="http://www.nytimes.com/2012/05/27/realestate/mortgages-speeding-up-short-sales.html?_r=0">short sale</a>. A short sale is a negotiated agreement between the lender and the borrower to sell the property for less than the amount of the mortgage. The borrower agrees to accept this “short” amount and typically cancels the remaining balance. The cancelled amount is reported to the IRS by the lender in a Form <a style="font-style: inherit; font-weight: inherit;" href="https://www.irs.gov/pub/irs-pdf/f1099c.pdf">1099-C</a>. When an individual is given money that they do not have to pay back, the IRS typically treats the money as <a style="font-style: inherit; font-weight: inherit;" href="http://www.hmrc.gov.uk/manuals/ccmmanual/CCM1135.htm">taxable income</a>. The “Mortgage Debt Relief Act of 2007” had made the cancelled debt on mortgages tax exempt. The “Mortgage Debt Relief Act of 2007” was a relief to the targeted homeowners who were unable to afford the high-interest mortgage, but were also unable to afford the high taxes stemming from a short sale. When a lender indicated on their 1099-C that the cancelled debt was through a negotiated short sale, the act allowed the IRS to exclude the discharge of debt from the borrower’s taxable income. The lender would then be given a tax credit for forgiving the remaining balance. As of December 31st, the tax exemption protecting homeowners has <a style="font-style: inherit; font-weight: inherit;" href="http://www.nytimes.com/2014/02/05/business/economy/lenders-see-write-off-while-underwater-homeowners-face-stiff-taxes.html?_r=0">expired</a>. Homeowners are now forced to treat the debt relief as taxable income, while the banks will still be able to write off the debt as a loss against their income, thus saving money on reducing the amount of taxes they must pay. As of January 1, 2014, homeowners opting for a short sale will see a massive increase in their taxes. For example, a <a style="font-style: inherit; font-weight: inherit;" href="http://www.nytimes.com/2014/02/05/business/economy/lenders-see-write-off-while-underwater-homeowners-face-stiff-taxes.html?_r=0">home-owner</a> who had bought his house before the market crashed for $250,000, negotiated a short sale for $150,000. The expiration of the tax exemption means that the home-owner will now have to treat the $100,000 relief as taxable income. For example, if the home-owner is in the 33% tax bracket, that home-owner will need to pay an additional $33,000 in income taxes! The Senate has introduced a <a style="font-style: inherit; font-weight: inherit;" href="http://www.stabenow.senate.gov/?p=press_release&id=1056">bipartisan bill</a> intended to restore the tax exemption and apply it retroactively to January 1, 2014. The passage of the bill is uncertain due to Congressional attempts to overhaul the entire tax-code instead. The Senate Finance Committee has made no indication that they are taking the bill into serious consideration, and have avoided answering any questions pertaining to it. There is hope that a bill retroactively applying the tax exemption will still pass this year. The Senate Finance Committee had been headed by Senator Max Baucus who had been hesitant in passing the bill and favored a complete tax overhaul. Now, Senator Baucus has been appointed as <a style="font-style: inherit; font-weight: inherit;" href="http://www.washingtonpost.com/blogs/post-politics/wp/2014/02/06/max-baucus-confirmed-as-u-s-ambassador-to-china/">ambassador of China</a> and the new head of the Senate Finance Committee, Democratic Senator Ron Wyden of Oregon, has a strong history of supporting homeowners. <a style="font-style: inherit; font-weight: inherit;" href="http://www.forbes.com/sites/beltway/2014/02/10/incoming-senate-finance-chair-wyden-outlines-his-tax-agenda/">Last week</a>, Wyden outlined his immediate agenda and made clear that passing a bill reinstating the tax credit will be a priority. For now, homeowners may still be able to apply for tax exemption under <a style="font-style: inherit; font-weight: inherit;" href="http://www.irs.gov/Individuals/The-Mortgage-Forgiveness-Debt-Relief-Act-and-Debt-Cancellation-">existing IRS rules</a> - but the burden lies on the individual. The automatic exemption is no longer applicable. Under the Existing IRS rules, cancelled debts are exempt from taxes if the individual proves that they are <a style="font-style: inherit; font-weight: inherit;" href="http://www.irs.gov/uac/What-if-I-am-insolvent%3F">insolvent.</a> A person is considered insolvent if they prove that the total amount of all of their debts exceeds the total amount of their assets. Instead of having an automatic tax exemption after the lender filled out a 1099-C, an insolvent homeowner selling a house through a short sale is now personally responsible for gathering all evidence and applying for tax exemption via a <a style="font-style: inherit; font-weight: inherit;" href="http://www.irs.gov/pub/irs-pdf/f982.pdf">Form 982.</a> I recommend that you call your members of Congress and tell them that you want them to extend the Mortgage Debt Relief Act of 2007. UPDATE: The law Mortgage Debt Relief Act was extended through December 31, 2015.2242Jeffrey B. PeltzArea of LawFamily LawBankruptcyAccidentsWills and EstatesReal EstateImmigrationHow Can a 1 Star Lawyer Get 5 Stars Reviews?How can a really bad lawyer get dozens of outstanding reviews on the internet? I know an attorney, who for obvious reasons I won’t identify, who gives incorrect legal advice, and yet gets rave reviews and top rankings in Google. He has told people that they can file bankruptcy when they can’t....Mon, 23 Sep 2013 00:00:00 -0400How can a really bad lawyer get dozens of outstanding reviews on the internet? I know an attorney, who for obvious reasons I won’t identify, who gives incorrect legal advice, and yet gets rave reviews and top rankings in Google. He has told people that they can file bankruptcy when they can’t. Even worst, he has told people that shouldn’t file bankruptcy that they can. Such legal advice could have adverse effects, such as losing their homes. I know this these things because some of the people that have gone to him have had the good sense to seek second opinions and have visited me. Being an ethical person, and never writing my own reviews, I feel strongly about this problem. Morally I find faked reviews offensive and in a very real practical way it financially hurts me, my staff and family. I have reported the faked reviews to Google on a number of occasions. Their only response was a form letter saying that they were very busy and they suggested that I take up the matter with the offending lawyer. The practice of posting faked reviews has become such a common problem that one can’t read reviews without the thought, are these real reviews? <a href="http://www.nytimes.com/2013/09/23/technology/give-yourself-4-stars-online-it-might-cost-you.html?pagewanted=all&_r=0">The New York Times</a> had a story on this issue today. If something isn’t done about this problem reviews will have be of little assistance in determining whether a service or product is good or not. Just last night, when I was shopping online for hiking pants, I faced this dilemma. There were 103 reviews; most were rave reviews and a few really bad ones. What was the truth? Were the bad ones real and did the company buy dozens and dozens of faked reviews to drown out the real bad ones? A few companies like Yelp are trying to deal with faxed reviews. In fact they <a href="http://blogs.lawyers.com/2013/09/yelp-sues-for-fake-reviews/">sued</a> an attorney for faxing reviews. On the other hand, Yelp “filtered” out 3 of 4 reviews that clients had left on their website for <a href="http://www.yelp.com/biz/law-offices-of-jeffrey-b-peltz-pc-brooklyn">me</a> because they suspected that they were faxed. If they really can eliminate most faked reviews I guess it might be worth the elimination of 75% of my legitimate reviews, but there is no way of knowing how successful they are in filtering out faked reviews; and being wrong 75% of the time isn’t very impressive. In order to counter the faked review problem I propose that you, the consumer, write reviews, both good and bad, when appropriate. Also, when you read reviews, keep in mind - are these real reviews or am I being lied to? For more on this subject you may view the <a href="http://www.aaalawyer.com/LinkClick.aspx?link=http%3a%2f%2fwww.npr.org%2fblogs%2falltechconsidered%2f2013%2f09%2f23%2f225455596%2ffake-reviewers-get-zero-stars-from-new-york-attorney-generalhttp%3a%2f%2f&tabid=680&portalid=1&mid=3869&language=en-US">NPR</a> story on fake reviews and the Forbes story on <a href="http://www.forbes.com/sites/jimhandy/2012/08/16/think-yelp-is-unbiased-think-again/" target="_blank">Yelp</a>.