ANOTHER LAWYER AGREES TO DISBARMENT FOR LOAN MODIFICATION ACTIVITIES

Media Contact: Diane Curtis       415-538-2028                                         diane.curtis@calbar.ca.gov

San Francisco, Sept. 22, 2010 –  An Orange County lawyer who handled dozens of foreclosure cases has admitted extensive misconduct that will lead to his disbarment. Brian Colombana (bar number 238272), who was placed on involuntary inactive status earlier this summer, stipulated last week that he committed nine acts of misconduct in 12 matters.

He becomes the fifth lawyer who agreed to be disbarred in the wake of complaints by homeowners who paid fees to lawyers who then did little or nothing to help them.

“The State Bar continues to be vigilant in prosecuting attorneys who have taken advantage of homeowners when they are at their most vulnerable,” said Bill Hebert, chair of the Board of Governors’ Discipline Committee. “The conduct of these lawyers, who make promises they can’t keep and take money their clients can ill afford to pay, is deplorable and we will continue our efforts to protect the public from such behavior.”

Attorneys for the State Bar’s Loan Modification Task Force, created in April 2009, have obtained five disbarments and 12 resignations of attorneys involved in loan modification misconduct. Six trials are pending and another 1,800 active investigations related to loan modification are underway; more than 4,000 complaints have come through the task force since it was formed.

Colombana, who practiced in Laguna Hills, accepted fees totaling nearly $36,000 from 12 distressed homeowners but did not obtain a single loan modification. Eight of the clients live in states where Colombana is not licensed to practice, and he admitted to engaging “in a scheme to defraud these clients, by exploiting them for personal gain and accepting employment where he was not licensed to practice law.”

Two of Colombana’s clients lost their homes to foreclosure, one had to sell his home at a loss and another cashed in insurance policies to bring the mortgage current and avoid foreclosure.

Colombana affiliated with several loan modification companies, including Loan Negotiators of America, Housing Law Center and Mortgage Relief Law Center. In most cases, he never met his clients. His associates, however, advised them to stop making their mortgage payments.  When State Bar Court Judge Richard Honn ordered Colombana to stop practicing in June, he said many homeowners were current but then fell behind as a result of that advice. Many “were worse off after retaining (Colombana’s) services,” Honn said.

In agreeing to disbarment, Colombana, 29, admitted that his misconduct “resulted in significant harm to multiple clients (and) . . . constituted a pattern of willfully failing to perform and a habitual disregard for . . . clients’ interests.”

###

The State Bar of California is an administrative arm of the California Supreme Court, serving the public and seeking to improve the justice system for more than 80 years. All lawyers practicing law in California must be members of the State Bar. By September 2010, membership reached 228,000.