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Thursday, July 25, 2013

Washington's Largest Foreclosure Company Charged With Conflict Of Interest-Home Auctions In Legal Jeopardy

Press Release:

Every morning scores of Seattle foreclosed homes go on the auction block. The company that handles more of these foreclosure sales than all of its competitors combined is Northwest Trustee Services (NTS) of Bellevue. This Friday, however, was a bit different.
At 10:00 AM, SAFE (Standing Against Foreclosure & Eviction) held a press conference in the parking garage where NTS holds its auctions — while the auctions were underway.
SAFE claims that NTS and its sister company Routh Crabtree Olsen (RCO), a law firm representing the banks, have a conflict of interest in the foreclosure process. According to SAFE, this conflict could put all homes sold at auction in legal jeopardy.
Per SAFE organizer Stephen Price, "RCO and Northwest Trustee Services are involved in an unethical conflict of interest. Northwest Trustee Services is required to act as a neutral party during the foreclosure process, but they are represented by RCO and owned by RCO lawyers. How can a homeowner expect fair treatment when the trustee is owned by lawyers representing the banks?”1
A recent Snohomish County Superior Court ruling appears to support Price’s claim. On July 11, Superior Court Judge Richard Okrent denied a motion to dismiss a case against both Quality Loan Service Corp. (QLSC), a Washington State trustee (foreclosing company), and McCarthy & Holthus (M&H), a California law firm representing the banks. The case alleges that QLSC did not act as a neutral party in a foreclosure as required by law, because the lawyers that own and operate M&H also own and operate QLSC.2
Scott Stafne, the lawyer who filed the case against QLSC and M&H agrees with Price. "This conflict of interest throws into legal limbo home sales done by not only Quality Loan Service and McCarthy and Holthus, but possibly RCO and Northwest Trustee Services, which have a similar relationship. Anyone buying a home at an NTS auction could become embroiled in a legal quagmire." 3

Unlike auctions conducted at the King County Administration Building in Seattle, the Bellevue auctions are held in the garage of the building owned by RCO lawyers.

“This too," says Price, "is a violation of Washington law, which specifically states that all auctions must be held at a ‘designated public place.’” 4

RCO was in the news last year during the 2012 gubernatorial election. RCO and NTS partners donated $13,800 to Rob McKenna, but when McKenna found out his office was investigating RCO for fraud, he returned the money.5

Also, in 2004-05 the Oregon State Bar suspended David Fennell, a founding RCO partner.6 He’s again under review for ongoing fraudulent practices.7

Meanwhile, Lance Olsen, the managing partner of RCO, is currently under review by the Consumer Protection Division of the Washington State Attorney General’s Office for conflict of interest.8

In Hawaii hundreds of parties are suing RCO / NTS for fraudulent foreclosure practices.9

According to RCO's website, they cover 17 states and boast having "the largest geographical reach in the default services industry." 10 

"Throwing families out of their homes and onto the streets in more neighborhoods than any other company in the US is quite a boast," says Price. "We need to change from a society that rewards corporations for evicting families to a society that regards housing as a human right."

SAFE is a grassroots, non-profit organization made up of volunteers and homeowners dedicated to building a mass movement to stop bank evictions, achieve principal reductions, and put people before profit. For more information please visit or call 206-203-2125.

1.     Per Washington State law RCW 61.24.010(4), a trustee “has a duty of good faith to the borrower, beneficiary, and grantor."

2.     Contact Stafne Law Firm for details: 425-345-2408.

3.     Per RCW 61.21.010(3), a trustee “shall have no fiduciary duty or fiduciary obligation to the grantor or other persons having an interest in the property subject to the deed of trust.”

4.     Per RCW 61.24.040(5), regarding foreclosure auctions, “The place of sale shall be at any designated public place within the county where the property is located and if the property is in more than one county, the sale may be in any of the counties where the property is located.”

6.  Seattle Story: Click Here 

8.   Sorry, not available at this time. Coming soon!

10.  See

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1 comment:

  1. It is well known that banks are illegally foreclosing on homeowners in Trustee States since the foreclosure process is lightly monitored by government agencies.
    To know more visit the website- stop trustee sale