After three long weeks of court time, the question remains – What will become of The Castle Law Firm post trial?
There’s a whole host of T.V. shows that came to be amid the recession, showing the American public how they can maximize profits in the house flipping industry. They chronicle the purchases of high profile flippers from auction to resale, driving home the importance of keeping costs low and turnaround times quick in order to maximize return. Industry experts continue to host nationwide seminars, selling tickets to promote new entrants into the game, all the while guaranteeing their returns as long as interest in their work is maintained. Many ancillary companies have also attempted to profit from foreclosure properties, moving them post purchase quickly for top dollar.
The three-week trial for Denver, Colorado, based Castle Law Group, and its owners, a husband and wife team Larry and Caren Castle, concluded on Friday. The couple and the company they built, Colorado’s largest foreclosure firm, are facing charges in a civil suit filed in July 2014 alleging a conspiracy to fix prices and maximize profits. According to the State of Colorado, the firm made millions, $12 million to be exact, at the expense of individuals and investment companies who purchased foreclosed properties by conspiring with other law firms and related businesses. The Aronowitz & Mecklenburg firm, Castle’s biggest competitor, was even named as a co-conspirator. The lawsuit marks the end of a statewide investigation into the firms acting as the biggest players in Colorado’s foreclosure industry.
The State alleged several overcharges by Castle Law Group, inflating the price of foreclosure notices from $30 to $125. The company was able to mark up the notices because of its interest in Absolute Posting, a company run by Ryan O’Connell and Kathleen Benton. O’Connell is Castle’s personal accountant.
Assistant Attorney General Erik Neusch focused primarily on the deception and misrepresentation the company engaged in at the height of the foreclosure crisis. The state alleged the Castles charged separately for work that should have been part of a foreclosure fee, and even formed a title company, Colorado American Title, to charge for policies never issued. Attorney Larry Castle testified on behalf of himself and his wife, reporting that they were at one time handling nearly 1,800 foreclosures every month.
At the conclusion of the trial, defense lawyer Larry Pozner stated there is simply no proof of the conspiracy the state is trying to prove, even though Aronowitz & Mecklenburg recently agreed to settle its related case for $10 million. Pozner says, rather, banks were simply willing to pay high fees for a firm that could get the job done quickly with a clear title. He argues the fees charged were fair for the work required. “You’re either a firm who can do an enormous number of foreclosures correctly or you’re not in the game,” Pozner said. Those that can keep up are a dime a dozen to banks, and they will quickly shift if a law firm isn’t able to meet demand. Castle Law Group was fortunate enough to be able to maintain amid the large influx of work.
Denver District Judge Morris Hoffman, who is tasked with deciding the case without the help of a jury, isn’t expected to submit a final ruling for at least a month. And so, the question remains – What will become of The Castle Law Firm post trial?
Sources:
Castle law firm cheated the foreclosure system, AG says in trial’s last day
Trial ends for foreclosure law firm accused of conspiring to inflate prices
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