Strom Law Blog

The Strom Law Firm, LLC is investigating allegations that the Boards of Directors of several South Carolina banks may have breached a duty owed to their investors resulting in hefty financial losses, including worthless stock.

While the FDIC provides protection for the assets of bank customers affected by intervention and/or closure, bank investors and shareholders suffering financial loss must seek legal action to recover for losses, including stock loss.

If members of the Board of Directors engaged in action(s) leading investors to suffer financial loss and/or failed to take action leading stockholders to suffer financial loss, you may have a claim to recover your stock loss. Investors in the following South Carolina banks may have suffered resulting stock losses:

• Bank of Anderson
• Bank of Westminster
• Bank of Meridian
• Community South Bank and Trust
• First Federal of South Carolina
• Independence National Bank
• Plantation Federal Savings Bank
• Williamsburg First National Bank
• First South Bank Corp
• South Carolina Community Bank
• Congaree State Bank
• Carolina First, Greenville
• Tideland Bancshares
• Palmetto Bancshares
• Southern First Bancshares, Inc./Greenville First
• Woodlands Bank
• Beach First Bank
• First National Bank of the South

While the circumstances leading up to federal intervention and/or closure are specific to each bank, the various allegations are serious and include:

• Engaging in certain practices felt to jeopardize the interest of depositors, customers, and shareholders of the bank;
• Practicing unsafe and/or unsound banking practices relating to asset quality, capital adequacy, earnings, management effectiveness and liquidity;
• Dissipation of assets and earnings due to unsafe and unsound practices;
• Business practices which violate applicable law and regulation;
• Operating without effective Board of Directors oversight and effective management supervision to prevent unsafe or unsound banking practices and violations of law and regulations related to the Bank Secrecy Act (BSA)
• Failing to operate safely and soundly in accordance with all applicable laws rules and regulations.

We will be posting further information regarding the underlying allegations and likely effects in the near future. If you own stock in one of the banks listed above, contact the Strom Law Firm, LLC for a free consultation today to discuss the how we may be able to help.

Earlier this week, South Carolina Director of Insurance, Scott Richardson, issued a cease-and-desist order reporting that Isle of Palms resident William M. Worthy, II, organized and spearheaded a nationwide, multimillion dollar health insurance fraud scheme.

The insurance fraud scheme, believed to have victimized at least 269 South Carolinians, involves the sale of limited benefit medical plans backed by nonexistent insurance to unsuspecting consumers through associations, and was orchestrated in large part from South Carolina.

Director Richardson was quoted as saying, “Unfortunately, scams such as this one leave those South Carolinians who can least afford it stuck with unpaid medical bills, which they thought were covered by insurance”.

Sixteen other states have taken regulatory action against those involved in the scheme.

As of March 26, 2010 the fraudulent insurance operation left approximately 19 million in outstanding claims.

South Carolina company, SouthEast Insurance Advisors, LLC., which the order says may be incorporated in Delaware, maintains a post office box on the Isle of Palms; the company is thought to be controlled by Worthy.

The other company believed to be involved in the scheme is Wilshire Holding, LLC, whose only address is a post office box at the address of a UPS store in suburban Columbia. Wilshire is not licensed by the state Insurance Department.

Others alleged to be involved in the operation and named in the order include:

• Kathleen D. Cauthen
• David L. Clark
• Lousi DeLuca
• Gary L. Karns, Jr.
• David L. Nellson
• Worldwide Family Benefits Association, Inc.,
• Wilshire Holding, LLC
• Viking Administrators, LLC
• Beema-Pakistan Company Limited
• Serve America Assurance, Ltd.
• SouthEast Insurance Advisors, LLC
• United States Contractors Trust
• Insurance Resource Group
• Integrated Insurance Marketing, Inc.
• CEO Clubs, Inc.
• Hudson Valley Consultants, LLC d/b/a CEO Club Benefits
• Metropolitan Business Alliance, LLC d/b/a National Association of Business Leadership
• Real Benefits Association, LLC

The order requires the respondents to stop selling or taking applications for insurance and to hold any insurance money collected.

We will keep you updated on the situation. If you purchased insurance from any of the companies named above, contact the Strom Law Firm, LLC today for a free consultation to discuss your legal rights.

It’s not often that you get to experience a quality local meal in Columbia, South Carolina which rivals that of a sophisticated big city restaurant.

Last night I had the distinct pleasure of eating at the New York Butcher Shoppe. Conveniently located out in North East Columbia at the Lake Carolina Town Center, the New York Butcher Shoppe & Grille offers a cuisine comparable to that of any famous steakhouse nationwide. It was so good in fact that I purchase a couple of veal steaks on the way out.

Owner Eddie Hargett has done a fantastic job of creating an atmosphere where you can enjoy a casual yet sophisticated dinner or celebration with friends, pick up some groceries or a few choice bottles of wine, or even pick up a lunch or dinner to go.

I highly recommend that you stop in to see Eddie. I know I will be back. It will definitely be worth the trip and you will not be disappointed.

The New York Butcher Shop is open for lunch Monday through Sunday from 11 a.m. to 3 p.m. You can stop in for Dinner on Wednesday through Sunday from 5 p.m. to 10 p.m.
The bar is open Monday through Sunday starting at 4 p.m.

Strom Law Firm is a personal injury and criminal defense law firm centrally located in Columbia, South Carolina. Our firm proudly handles personal injury, criminal defense, defective products, class actions, pharmaceutical liability, toxic torts, medical malpractice, nursing home neglect, workers compensation, social security, veteran’s benefits, qui tam, predatory lending, tax investigations, business litigation, and wills and estates matters. The attorneys at our firm enjoy a good meal as much as we enjoy practicing law. Our lawyers proudly edit: the Columbia, South Carolina Injury Board , and the Strom Law Blog , as well a workers compensation, social security, and DUI blog in an effort to provide the public valuable information. Our lawyers are licensed in: South Carolina, New York, and Georgia.

In addition to agreeing to pay $16.4 million dollars in fines for concealing safety defects related to sudden acceleration issues in 2-3 million vehicles on Monday, Toyota Motor Corporation also announced a voluntary safety recall of its 2010 Lexus GX 460 SUV’s.

As reported by USA Today, Toyota says it will recall approximately 9,400 vehicles to address potential concerns with the SUV’s Vehicle Stability Control (VSC) which functions to prevent possible rollovers.

Last week, Consumer Reports Magazine issued a don’t-buy warning due to problems engineers encountered during standard emergency-handling tests. Test drivers found the problem during a routine exercise where drivers abruptly lifted off the gas pedal while driving quickly through a sharp turn. The maneuver caused the rear end of the vehicle to slide outside of the turn. It was reported that unlike in other SUV’s previously tested, the Vehicle Stability Control system in the Lexus GX 460 acted too slowly to stop the slide and allowed the vehicle to turn sideways, greatly increasing the chance of a rollover.

In a press release on their website, Toyota Motor Sales announced the recall will involve a software update on the SUV’s Vehicle Stability Control system. Steve St. Angelo, Toyota Chief quality officer for North Carolina stated:

“Our engineers have conducted tests to confirm the VSC performance issues raised by Consumer Reports, and we are confident this VSC software update addresses the concern.”

Toyota executives announced that all Lexus dealerships will have the VSC update by the end of April and Lexus will begin mailing letters to GX 460 owners in early May.

National Highway Traffic Safety Administration (NHTSA) and U.S. Department of Transportation (DOT) statistics have shown:

• Rollover crashes account for 33% of all passenger vehicle fatalities
• More than 10,000 people a year are killed in rollover crashes

• Taller, narrow vehicles are more likely to rollover

• You are 75% less likely to be killed in a rollover if you are wearing your seatbelt

Strom Law Firm is a personal injury and criminal defense law firm centrally located in Columbia, South Carolina. Our firm proudly handles personal injury, criminal defense, defective products, class actions, pharmaceutical liability, toxic torts, medical malpractice, nursing home neglect, workers compensation, social security, veteran’s benefits, qui tam, predatory lending, tax investigations, business litigation, and wills and estates. Our lawyers proudly edit the Columbia, South Carolina Injury Board as well as the Strom Law Blog as a pro bono effort to provide the public valuable information. Our lawyers are licensed in: South Carolina, New York, and Georgia.

According to the Wall Street Journal, the federal investigation of Countrywide and what brought on the company’s collapse appears to be heating up.

According to a WSJ article released Monday, federal criminal investigators tasked with examining what led to the collapse of Countrywide have been calling witnesses before a grand jury as part of their criminal investigation.

This suggests that the investigation of the one-time mortgage giant, which has been continuing for about two years, could be moving closer to a resolution.

While the grand jury began hearing witnesses on the Countrywide case late last year, no one knows what potential crimes are being investigated or who the grand jury is talking to.

While calling witnesses before a grand jury doesn’t mean that charges will be filed, it does appear to signify a pick-up in the tempo of a probe that did not appear to be moving very quickly.

In the meantime, Countrywide continues to fight legal battles on other fronts, including a suit brought by the SEC as well as the Consolidated Class Action Civil Suit currently pending in California. The Strom Law Firm serves as proposed class counsel in Consolidated Class Action.

The Class Action

The lawsuit, which is filed on behalf of countless borrowers who were allegedly systematically steered into subprime loans regardless of the type of loan they qualified for, claims that Countrywide, and its network of authorized, contracted brokers, have defrauded countless borrowers across the nation through an undisclosed, systematic scheme designed to steer borrowers into subprime loans. The elaborate scheme seeks to maximize profits for the benefit of the Company, to the detriment of the homeowner.

In order to carry out the scheme, Countrywide and its network, failed to disclose the financial consequences tied to each loan, including:

• the monthly payment, which frequently increased to an amount that the homeowner could not pay, and
• negative amortization, which results in the loan amount actually increasing rather than decreasing over time.

The scheme was carried out regardless of whether:

• the borrower would have qualified for a “prime loan” or
• the borrower was unable to meet the financial terms of the subprime mortgage.

The resulting effect of systematically steering borrowers into inappropriate subprime loans with excess charges and inadequately disclosed risks, includes drastic and unexpected increases in required monthly payments that have caused a flood of foreclosures and financial woes among the Class.

Countrywide and its network of authorized, contracted brokers, also pushed dangerous products such as “pay option ARM” loans, wherein borrowers could afford only to make what Countrywide called the “minimum payment,” which was actually less than the interest owed on the loans, thus increasing their outstanding principal every month and triggering an automatic resetting of the payments, resulting in the minimum monthly payments increasing dramatically after only a short amount of time to a level that guaranteed the flood of foreclosures that we are seeing today. By many estimates, as early as 2006, up to 80% of all option ARM borrowers are only making only the minimum payment each month.

The lawsuit, which has not yet been certified as a Class Action, seeks an injunction prohibiting Countrywide from continuing to engage in its predatory lending practices and requests that Countrywide seeks monetary damages including disgorgement of profits received as well as restitution to borrowers harmed.

The SEC Suit

The lawsuit brought by the SEC asserts that the three men, including former CEO Angelo Mozilo, defrauded investors by falsely claiming that Countrywide underwrote low-risk mortgages at a time when the company was getting into increasingly risky parts of the lending business, including so-called “subprime” mortgages made to less creditworthy borrowers.

The SEC additionally accuses Mozilo of insider trading of Countrywide stock. A trial in the case is scheduled for October. All three defendants vehemently deny any wrongdoing and say they plan to fight the SEC charges.

We will keep you updated as these matters progress.

Strom Law Firm is a personal injury and criminal defense law firm centrally located in Columbia, South Carolina. Our firm proudly handles personal injury, criminal defense, defective products, class actions, pharmaceutical liability, toxic torts, medical malpractice, nursing home neglect, workers compensation, social security, veteran’s benefits, qui tam, predatory lending, tax investigations, business litigation, and wills and estates. Our lawyers proudly edit the Columbia, South Carolina Injury Board as well as the Strom Law Blog as a pro bono effort to provide the public valuable information. Our lawyers are licensed in: South Carolina, New York, and Georgia.

Benedict College received an education in fire safety and fire prevention Monday.

As reported by WIS TV, Benedict College President David Swinton pleaded no contest to charges of failing to maintain fire alarms in two of the college dormitories.

In March, the Columbia Fire Department’s Fire Prevention Bureau issued charges after Benedict College could not produce records confirming that annual fire maintenance had been conducted on fire alarms and sprinkler systems inside two dormitories.

The school contracts TriTek, a private firm alarm company, to maintain and test the school’s fire and sprinkler systems.

Deputy Fire Marshall Kent Scott told a judge Monday that “the college completed the required maintenance after the tickets were issued” and that school officials have spent “millions of dollars in an effort to become complaint with the city’s fire codes”.

Inspection reports released to WIS TV in October 2009 revealed more than 500 fire code and fire safety violations at the college, including allegations that nearly every fire alarm and sprinkler system in Benedict’s dorms was not functioning properly.

Other deficiences noted included blocked, broken, and locked emergency exits which could have trapped innocent college students in the event of a fire.

Columbia Municipal Court Judge Dana Turner ordered Benedict President Swinton to pay $722.50 relating to the charges, but suspended the fines, leaving Swinton to pay $200 in Court costs. Benedict’s compliance records will not be known until October, when the City of Columbia Fire Department is set to complete a full annual inspection.

According to the National Fire Protection Association (NFPA), the estimated number of fires in campus housing has increased dramatically in recent years. NFPA cites the following startling statistics on dormitory fire-related civilian deaths and property damage:

• Between 2003-2006, U.S. fire departments responded to an estimated average of 3,570 structure fires in dormitories, fraternities, sororities, and barracks. These fires caused an annual average of 7 civilian deaths, 54 civilian fire injuries, and $29.4 million in direct property damage.

• Between 2003-2006, cooking equipment was involved in 75% of the reported dormitory fires; this includes confined or contained fires.

• Structure fires in dormitories, fraternities, sororities, and barracks are more common during the evening hours between 5-11 p.m., as well as on weekends.

• Only 5% of fires in these properties began in the bedroom, but these fires accounted for 62% of the civilian deaths and one-quarter (26%) of the civilian injuries.

Strom Law Firm is a personal injury law firm centrally located in Columbia, South Carolina. Our firm proudly handles personal injury, cases including burn injury and death cases, criminal defense, defective products, class actions, pharmaceutical liability, toxic torts, medical malpractice, nursing home neglect, workers compensation, social security, veteran’s benefits, qui tam, predatory lending, tax investigations, business litigation and wills and estates.

The April 15th deadline to file your 2009 Tax Returns is fast approaching.

Finding tax credits and tax deducations can make filing your tax return a little less painful, but what about snitching on tax cheaters?

According to MSN money, tax snitching is a non-conventional way to score a little money from the tax man.

The IRS whistle blowing program has actually offered cash bounties to citizens who turn in tax cheats for over 140 years!

If you snitch on a tax cheater, you could be paid based upon of all the recovered tax and penalties collected as the result of your tip, up to a maximum payment of two million dollars.

If you find the idea of snitching to the IRS deplorable, you should know that its the honest tax payers who end up paying for tax cheats, to the tune of $127 billion per year. That’s 1,000 extra in taxes for each of us every year.

Tips are important to the IRS.

Annually, the IRS collects more than $100 million and pays out from $2 million to $5 million to snitches.

If you plan on filing a tip we should warn you. As the saying goes, no good deed goes unpunished, and an IRS reward is considered taxable income.

IRS Publication 733 outlines the regulations for claiming a reward.

To file a claim as an informant, you need to fill out Form 211.

In order to collect a reward, you must be willing to fill out your own name. However, your personal information will be protected, as the IRS is legally prohibited from disclosing the identity of an informer to unauthorized persons.

If you have any questions about reporting a tax cheat you can call the agency’s fraud hotline at 1-800-829-0433 for help.

Don’t wait while the interest and penalties you owe to the IRS continue to mount. Contact the tax attorney at the Strom Law Firm, LLC today for a free consultation to discuss how we can help you put your IRS tax debt behind you. Our lawyers proudly edit the Columbia, South Carolina Injury Board as well as the Strom Law Blog as a pro bono effort to provide the public valuable information. Our lawyers are licensed in: South Carolina, New York, and Georgia

Good news on the home front!

As reported by WIS, the Obama administration launched a new effort on Monday designed to speed up the time-consuming, stressful process of selling your home if you owe more than it’s worth.

On the other hand, if you are looking to purchase a home or investment property, taking advantage of a short sale has just gotten easier.

If you owe more than your home is worth and you are trying to sell your home, you will receive $3,000 for moving expenses if you complete a short sale – or agree to turn over the deed of the property to the lender.

The program was designed for homeowners who are in financial trouble but who don’t qualify for Obama’s $75 billion mortgage modification program.

The new program benefits an upside down seller and the lender who financed the home.

• While you will still technically lose your home, a short sale or deed in lieu of foreclosure doesn’t hurt your credit score as drastically as a foreclosure.

• Your lender will receive more money for a home in a short sale than it would typically receive in a foreclosure.

• The bank also avoids expensive legal bills, cleanup fees and maintenance costs that typically follow a foreclosure.

“It’s very traumatic and embarrassing and frustrating to go through a foreclosure,” said Laurie Maggiano, policy director of the Treasury Department’s homeownership preservation office. With a short sale, she said, “your financial issues are your own problem and not neighborhood conversation.”

Reports indicate that at least 350,000 homeowners nationwide are expected to benefit from the program through the end of 2012.

For buyers looking to purchase a home, a short sale can be a great opportunity.

Along with the financial incentive for struggling homeowners, the new government program requires the mortgage company to set its minimum bid before the house is listed for sale. If the offer is above the minimum bid, the lender must accept it.

The change is expected to speed up the short sale process as lenders typically have not calculated how much money they were willing to accept on a short sale until they had an offer in hand, causing long delays before the sale was approved.

The new program “will give us a degree of efficiency that we have not had in the past,” said Matt Vernon, Bank of America’s executive in charge of short sales and foreclosed properties.

Under the new process, if you submit an offer to purchase a home in a short sale you should receive a response within two weeks, as opposed to months it previously took to get a response.

The plan which was originally outlined by the Treasury Department last November, recently doubled the original $1,500 in relocation money noting that many homeowners will need more cash to move out.

Now for the restrictions.

• To qualify the home must be your primary residence;

• You must be behind on their mortgage or on the verge of becoming delinquent; and

• Currently, the program is not available for mortgages owned or guaranteed by mortgage finance companies Fannie Mae and Freddie Mac.

However, reports indicate that the two government-controlled companies will soon follow suit.

Strom Law Firm is a personal injury and criminal defense law firm centrally located in Columbia, South Carolina. Our firm proudly handles personal injury, criminal defense, defective products, class actions, pharmaceutical liability, toxic torts, medical malpractice, nursing home neglect, workers compensation, social security, veteran’s benefits, qui tam, predatory lending, tax investigations, business litigation, and wills and estates. Our lawyers proudly edit the Columbia, South Carolina Injury Board as well as the Strom Law Blog as a pro bono effort to provide the public valuable information. Our lawyers are licensed in: South Carolina, New York, and Georgia.

In the midst of another recall announcement related to 2000-2003 Tundra pick up trucks, a Santee couple died in a single car crash just outside of Santee in Orangeburg County yesterday.

According to the Times and Democrat, Leroy Shingler and Ruby Shinglers’ 2009 Toyota Camry was traveling south on Highway 15 when it veered off the right side of the highway, came back across the road, left the highway and struck a tree. Both were wearing seatbeats, but died as a result of the crash.

Toyota has recalled more than 8 million cars and trucks worldwide to address gas pedals and floor mats that can cause the accelerator to become stuck in the depressed position. Federal regulators have linked 52 deaths to crashes allegedly caused by the accelerator problems.

Several 2009 Camrys have been recalled due to sudden acceleration issues. There are reports that Toyota will be involved in the accident investigation, and in the midst of the Toyota Recall controversy, nothing can be ruled out until the SCHP’s Multi-Disciplinary Accident Investigation Team wraps up its investigation.

Our thoughts are with the Shingler family.

Strom Law Firm is a personal injury and criminal defense law firm centrally located in Columbia, South Carolina. Our firm proudly handles personal injury, criminal defense, defective products, class actions, pharmaceutical liability, toxic torts, medical malpractice, nursing home neglect, workers compensation, social security, veteran’s benefits, qui tam, predatory lending, tax investigations, business litigation, and wills and estates.

Our lawyers proudly edit the Columbia, South Carolina Injury Board as well as the Strom Law Blog as a pro bono effort to provide the public valuable information. Our lawyers are licensed in: South Carolina, New York, and Georgia.

As reported by WIS TV, the IRS is now more willing to negotiate a tax settlement for less than you owe. Acknowledging the effect that the recession has had upon Americans nationwide, the IRS is allowing IRS agents more flexibility to work with taxpayers who have seen their incomes recently drop.

IRS Commissioner Doug Shulman announced earlier this week that the agency is loosening its rules for negotiating tax settlements and accepting less than the amount owed.

Beginning on March 27, 2010, the agency plans to start opening some local offices on Saturdays, to give taxpayers more opportunities to resolve their tax debts.

The IRS expects to process 138 million individual tax returns this year. While most taxpayers will qualify for a refund, with the drastic job loss that has accompanied the recession, many taxpayers will be unable to make timely payments.

Common IRS Settlement Options

Offer in Compromise: The IRS does not want you to know that as a tax payer you may be able to settle your outstanding tax liability for less the actual amount owed.

Non-Collectable Status: If you do not have the extra income to pay off your tax debt and need your entire paycheck to cover all essential living expenses, you may be eligible to have your debt classified on non-collectable status.

Installment Agreement: The taxpayer enters into an agreement with the IRS to pay a period of smaller, more manageable payments towards his or her tax liability.

Levy and Lien Releases: The IRS has a tremendous amount of power and can seize your assets, including your paycheck as well as money that you have in your personal bank account.

Penalty Abatement: If you owe the IRS, you can be forced to pay interest and penalties on the amount owed. Penalties can be staggering and turn an otherwise manageable debt into an uncontrollable situation.

Don’t wait while the interest and penalties you owe to the IRS continue to mount. Contact the tax attorney at the Strom Law Firm, LLC today for a free consultation to discuss how we can help you put your IRS tax debt behind you. Our lawyers proudly edit the Columbia, South Carolina Injury Board as well as the Strom Law Blog as a pro bono effort to provide the public valuable information. Our lawyers are licensed in: South Carolina, New York, and Georgia.