Service of court papers probed

Las Vegas police are investigating allegations that an unlicensed process serving company submitted false affidavits in justice courts around the valley, potentially disrupting the lives and finances of thousands of civil case defendants.

The company, On Scene Mediations, is alleged to have filed affidavits swearing that it had served defendants with copies of lawsuits, but in many cases the lawsuits were not served, police and court officials said.

That resulted in judgments of default against some defendants because they failed to respond to the lawsuits in a timely manner. Justice Courts handle civil disputes of less than $10,000, usually involving credit card and consumer debt and car repossessions.

On Scene Mediations, run by former Las Vegas police officer Maurice Carroll, did a lot of work for payday loan and debt collection companies, officials said. Authorities are looking at that firm but also might broaden their investigation to cover other process servers.

"Our focus at this time is to see how many victims there are through this company, as well as victims from other companies," Intelligence Lt. Dave Logue said.

Court officials said they don't know how widespread the problem is; Logue estimated thousands of cases could be affected. He said records show that Carroll's company, which was run out of his North Las Vegas home, was doing about $50,000 in business a month, a large volume of work for a company of its kind.

Intelligence detectives raided Carroll's home on July 6, seizing financial and business records.

Detectives are now seeking an arrest warrant for Carroll, 42, who left the police department in 2000 after roughly 10 years of service, on possible charges of perjury and filing false court documents, officials said. Carroll could not be reached for comment.

Most of the cases involving the alleged fraudulent affidavits are in Las Vegas Justice Court, but detectives also have found cases in the North Las Vegas and Henderson justice courts, Logue said.

Las Vegas Justices of the Peace Melissa Saragosa and Diana Sullivan, who dealt primarily with civil cases, asked police to investigate earlier this year after noticing irregularities over a period of months.

"People were showing up in court saying they were never served with papers," Logue said. "Apparently, the companies and the courts were taking (Carroll's) word that they were served properly."

Defendants were able to prove there was no way Carroll's company could have served them with court papers, Saragosa said.

Saragosa said court officials also noticed that some of Carroll's employees reported serving large numbers of defendants on the same day they received the papers from the company's clients. It usually takes more than a day for process servers to find people, she said.

On Scene Mediations has been in operation for several years, but apparently the company has no state or local business licenses. Detectives are concentrating on cases involving the company in the past year, Logue said.

One of those cases involved a $1,061 medical debt a collection agency, Richland Holdings, wanted to collect from Alan Wood and his ex-wife, Janet.

Wood, 60, a longtime Southwest Gas Corp. manager who disputes even owing the $1,061, told the Las Vegas Review-Journal that he learned Richland Holdings had obtained a default judgment against him only when his pay was to be garnished in June 2009.

"We were totally blind-sided," he said, adding that he and his ex-wife turned to attorney Christopher Reade to help them fight back. The couple presented extensive evidence that they weren't home on the days when a Carroll process server claimed in sworn affidavits that they were served with lawsuit copies, court records show.

"Very simply, this affidavit of service is a sham and a fraud," Alan Wood said in his own affidavit.

In her affidavit, his ex-wife said she was forced to spend "huge attorney's fees having to unwind the fraud in this case."

Justice of the Peace Diana Sullivan eventually lifted the default judgment against Wood, who is counter-suing Richland Holdings for allegedly allowing Carroll's company to "abuse the legal process."

Kevin Hansen, an attorney representing Richland Holdings in the case, did not return phone calls.

Wood, who has been interviewed by police, told the Review-Journal that he stepped forward to help expose Carroll's company.

"If they would try to do this to a professional person who has a sound history of being a responsible citizen, then we feel like they were doing this to hundreds and hundreds of other victims who had no power to fight back," he said.

Reade added that he has never seen "a fraud of the scope that is being alleged in this case."

Mechele Ray, executive director of the Nevada Private Investigators License Board, confirmed that Carroll's company is not licensed to operate as a process server. She said her agency investigated a complaint against the company brought by Las Vegas justices of the peace, but she would not discuss the probe.

"We've taken what we feel is the appropriate action at this time," she said.

Independent contractors, such as Carroll, face fines of up to $10,000 if they fail to get a license after a warning from the Private Investigators Board, Ray said.

Among the items police seized from Carroll's home were a shotgun, company payroll records and "paperwork" related to attorney Lizzie Hatcher.

Hatcher, who is not a target of the investigation, did not return phone calls. But in a letter to Las Vegas justices of the peace a week after the raid, Hatcher acknowledged a professional relationship with Carroll. She also said Carroll's mother and grandmother worked for her "years ago."

Hatcher wrote that both she and Carroll were doing work for the payday company Rapid Cash, and that Carroll served roughly 3,000 lawsuits she had filed on that firm's behalf.

Saragosa said both Rapid Cash and Richland Holdings have brought thousands of cases to Justice Court over the past couple of years. .

She said she did not know if On Scene Mediations handled all of those cases, and said officials will have difficulty determining exactly how many cases were tainted.

"That information is not readily available in a searchable format in our case management system," she said. "It would require an hands-on review of every single file, and that would be incredibly costly."

Contact Jeff German at jgerman@review journal.com or 702-380-8135 or read more courts coverage at lvlegalnews.com.