Suspended miami criminal lawyer target of mortgage fraud lawsuit
Posted on August 06, 2009 3:00 AM EST
A Miami criminal lawyer
who formerly ran for the office of Public Defender in Miami-Dade County is now engulfed in a complex foreclosure lawsuit initiated by JP Morgan. Gabriel Martin, a Miami attorney currently under suspension by the Florida Bar was allegedly involved in serial mortgage fraud
to the tune of 10 million dollars relating to a residence located on Miami Beach, Florida. Washington Mutual which was recently taken over by JP Morgan alleges that Martin prepared loan documents, but failed to meet his obligations.
Martin a suspended Miami criminal lawyer, was hired by Washington Mutual to ensure that the sale of property met the requirements under Florida law and the title was properly transferred and the mortgage properly recorded. The residence that is the subject of the lawsuit is a luxury mansion located at 4424 N. Bay Rd. on Miami Beach, Florida. Martin was hired to be the closing agent for the sale of the home from Eddie Irvine, a Formula One race car driver, to Jose Marsicobetre Mejia in 2006.
The case is set in state court
for trial in January 2010 in front of with Judge Gil Freeman. The case is set for a bench trial (no jury) where the judge will determine which lender has ownership rights to recover money from the foreclosure sale. At the forefront of the fraud was Jason Zabaleta who conspired to defraud Washington Mutual twice, once in 2005 for 3.9 million dollars and one in 2007 for 4.5 million dollars. Zabaleta, along with others is also a named party in the lawsuit.
The other lenders that have a monetary interest in the home are Akbar Nikooie who claims Zabaleta defrauded him out of 1.16 million dollars which was supposed to be used as a construction loan. The money was used for a down payment and not for construction. General Mortgage Associates (GMAI) is also making a claim on the property. GMAI loaned Zabaleta 3.5 million dollars in 2007 to purchase the home. None of the mortgages were properly recorded which puts into doubt who has the first right to the proceeds resulting from the foreclosure on the home.
The judge has to decide which mortgage was recorded first to determine which entity has priority to the money which will become available in the near future. Martin is a party to the lawsuit due to his alleged negligence in failing to properly record the mortgages. This case is just another example the damage caused by lending frenzy during the South Florida housing boom. These loose lending practices almost sent Wachovia, Citigroup and Washington Mutual into bankruptcy.
Suspended Attorney Target of Mortgage Lender's Lawsuit
, Daily Business Review, August 5, 2009.