A Portland attorney who had a financial interest in Vancouver's eLIFE Financial Inc. has been suspended for two years by the Washington State Bar Association for violating the bar's ethical rules in mortgage modification cases involving some 287 clients.
The Washington State Bar concluded that Christopher D. Schwindt, who has practiced since 2001, failed to inform mortgage modification clients about his financial interest in eLIFE and for misrepresenting legal services promised to clients. The affected cases covered a five-month period starting in 2008. Schwindt also faces discipline by the Oregon State Bar Association on the same charges. The charges were filed with the Oregon Supreme Court on Dec. 12.
The Washington state bar concluded that Schwindt didn't inform clients that he would profit from fees they paid to eLIFE. At the same time, he offered clients legal services for $100 to $500. Clients did not receive legal advice on whether a loan modification would be in their best interest, and Schwindt delegated negotiations to employees who were not lawyers.
Schwindt became a capital partner in eLIFE Financial Inc. in November 2007. By 2008 -- the height of the recession -- eLIFE was in deep financial trouble. Schwindt made two separate loans of $25,000 to eLIFE president Isaac Voss of Ridgefield to help keep the financial consulting firm afloat, according to the Washington state bar. Meanwhile, Schwindt acted as outside general counsel for eLIFE.
In October 2008, eLIFE began accepting mortgage modification clients. Clients generally paid about $4,500 for eLIFE to negotiate a mortgage modification with their lender. Some of their payments were to go to Schwindt as repayment on the loan he had made to Voss, according to bar association documents.
Each client also was offered a separate legal services agreement with a law firm. In many cases, it was Schwindt's firm.
It's unclear what his firm was called at the time. On the Washington bar association's directory, he is listed as being part of the SRL Firm, which now has a defunct Web address. On the Oregon State Bar Association's directory, he is listed as part of PDX Law Group PC. Both firms have addresses listed at 621 S.W. Morrison in Portland. A call to the PDX Law Group office was not returned.
Schwindt charged $100 to $500 to review the file, negotiate and finalize terms of the modification suggested by eLIFE and review documents from the lender.
ELIFE, had the same office location and some of the same leadership as another Vancouver-based mortgage brokerage firm, Lighthouse Financial Group, which was penalized in Oregon for wrongdoing. eLIFE and Lighthouse were located at the same office at 4001 Main St. near downtown Vancouver.
Lighthouse and its president, Sheldon Harmon, were barred from doing business in Oregon in 2009 for illegal lending practices and had been investigated, but never charged or penalized, by the Washington State Department of Financial Institutions.
Lighthouse violated Oregon's mortgage lender law by opening unlicensed branches, failing to notify the state of new hires, hiring brokers who had criminal records or were unlicensed, keeping shoddy client records and providing fraudulent information on mortgage applications.
Lighthouse was licensed in Oregon and Washington between 2002 and 2009 and had 11 branches in the two states.
Harmon incorporated eLIFE Mortgage Inc. and listed himself as president and Voss as vice president, according to the Washington Secretary of State's Corporations Division.
Voss later served as president of eLIFE Legal Network Inc. and eLIFE Holdings when they were incorporated in September 2008. He also was president of eLIFE Legal Support Inc., incorporated in January 2009. All of the eLIFE companies were located at the Lighthouse address at 4001 Main St.
Schwindt was listed as the registered agent of eLIFE Legal Network and eLIFE Holdings.
All of the companies are now listed as "inactive."
A voice mail system at the Voss residence was full.