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Northwestern Law professors receive grant to continue work with victims of mortgage fraud

The Foundation of Federal Bar Association (FBA) has awarded the association’s Chicago Chapter a grant for the “Legal Education in the Community: The Rights and Responsibilities of the Family Home” program, which will be presented with the Bluhm Legal Clinic and Northwestern Pritzker School of Law professors Juliet Sorensen and Sam Tenenbaum.

The Foundation’s Chapter Community Outreach Grants are designed to support community service and outreach projects that involve FBA chapter participation.  

“The Federal Bar Association and its Chicago Chapter remain interested in the welfare of communities across this country — and stand firmly against those who try to exploit vulnerable populations,” said Barry Fields, president of the Chicago Chapter.

The Foundation grant will fund a community-based education program targeted to adult learners about the legal rights and responsibilities of home ownership. The program will include a series of modules on real property transactions, mortgage obligations, property taxes, building codes and common forms of fraud on homeowners. 

The program will take place in Chicago’s North Lawndale neighborhood, the site of an extensive reverse mortgage scheme targeting elderly African American homeowners. This scheme is the subject of a pending multi-defendant federal criminal mortgage fraud indictment. 

Northwestern Law’s Bluhm Legal Clinic faculty and students will design and help carry out the program in partnership with Rev. Robin Hood, a North Lawndale community organizer, and Mothers Opposed to Violence Everywhere (MOVE), a community-based organization that has long worked with the Clinic on behalf of its clients and other elderly homeowners in North Lawndale. 

In January 2019, the Clinic announced a partnership with the Rev. Hood and MOVE on behalf of victims of Mark Diamond, a Chicago man who has been charged by the U.S. Attorney’s Office for the Northern District of Illinois with defrauding more than 120 homeowners in a reverse mortgage scheme. 

“Financial exploitation of vulnerable seniors is an epidemic,” said Sorensen, clinical professor of law at the Bluhm Legal Clinic.“ The support of the Foundation of the Federal Bar Association allows us to design a program, consistent with our ongoing representation of victims of a predatory mortgage fraud scheme, that empowers community members to appreciate the rights and responsibilities of homeownership.”

Currently, Sorensen and Tenenbaum are co-counsel for 42 victims of the mortgage fraud scheme and are preparing a petition for leave to appeal to the Illinois Supreme Court in the case of a foreclosure order for one client and applying to the Cook County Assessor for reductions in the property tax bills of all eligible clients. 

Reverse mortgages and reverse mortgage fraud have blighted urban neighborhoods across America, littering them with foreclosures and evictions. The racially disparate impact of these schemes is stark. An investigative analysis by USA Today in 2019 found reverse mortgage schemes end in foreclosure six times more often in predominantly African American neighborhoods than in neighborhoods that are largely white. 

“This work by Professor Sorensen, Professor Tenenbaum and dozens of Northwestern Law students is exactly what clinical legal education is about. It’s an opportunity for law students, under the careful supervision of dedicated and creative professors, to understand the damage the law can do, and to experience the good the law can do,” says Robin Walker Sterling, director of the Bluhm Legal Clinic at Northwestern Law. “Particularly now, when systemic racism is at the forefront of our national consciousness, it is critical that new lawyers learn tools to recognize systemic racism and tactics to combat it.”