States Step Up Pressure On Mortgage Fraud

Illinois, New Jersey among states taking action

By Mark Huffman
ConsumerAffairs.com

November 30, 2009

Mortgage "Rescuers" • FTC Wants to Outlaw Advance-Fee Foreclosure Rescue • Ohio Sues California Foreclosure Rescue Operations for Conning Consumers • Church Groups Indicted in Delaware Mortgage Rescue Scheme • States See Foreclosure Crisis Getting Worse • Government Reports Progress On Mortgage Modification Plan • Arizona Sues Loan Modification Company for Deceptive Practices • Oregon Blocks California Loan Modification Firm • Maryland Officials Halt Foreclosure Rescue Scam • States Step Up Pressure On Mortgage Fraud • Florida Attorney General Warns Big Banks On Modifications • Ohio Sues Mortgage Servicer For 'Incompetence' • Brown Challenges Banks On 'New Wave' Of Foreclosures • California Law Cracks Down On Foreclosure Rescue • Feds And States Get Tough On Scams • FTC Continues Crackdown On Mortgage Relief Scams • Florida Sues Foreclosure "Rescuer" Targeting Hispanics for Fraud • Class Action Proceeds Against Debt-Relief Scam • States Increase Pressure On Foreclosure Consultants • New York Sues Loan Modification Company • California Puts Foreclosure Consultants On Notice • Mortgage Modification Program Off To Slow Start • Florida Sues Four Foreclosure Rescuers • California Sues Dozens Of Mortgage Rescue Scammers • Don't Put Your Hopes, Or Money, In A Loan Modification • Ohio Launches Foreclosure Rescue Crackdown • Feds Look at Tougher Foreclosure 'Rescue' Rules • California Seeks To Register Foreclosure "Consultants" • FTC Slams Fake Government Loan Rescue Operation • Ohio Puts Heat on Foreclosure Rescue Operations • California Foreclosure ‘Rescue’ Defendants Rounded Up • Missouri Joins Mortgage Scam Smackdown • Florida Targets Fraudulent Foreclosure "Rescue" • Florida Foreclosure "Rescue" Company Shut Down • Illinois Sues Seven Companies for Mortgage Rescue Fraud • California Busts Foreclosure Scam Ring • Florida Sues Foreclosure Rescue Company for Deceptive Practices • Mortgage Rescue Fraud Schemes On The Rise • Indiana Charges Mortgage Broker With Scamming Homeowners • Indiana Targets "Foreclosure Consultant" • Missouri Attorney General Takes on Foreclosure Scams • New Washington Law Protects Distressed Home Sellers • Foreclosure 'Rescue' Firm To Pay $1.2 Million To Arizona Victims • Florida Governor Signs Foreclosure Rescue Law • California Busts 'Land Grant' Foreclosure Scam Artists • California Shuts Down Mortgage Scam Artists • FTC Takes On Mortgage 'Rescue' Operations • Illinois Uses New Law to Sue Mortgage Rescue Company • Washington State Settles with Mortgage "Rescuers" • Scams and Foreclosures On the Rise • Illinois Sues Mortgage "Rescue" Companies • Mortgage Crisis? Act Now to Avoid Foreclosure • North Carolina Shuts Down Mortgage "Rescue" Operation • Illinois Shuts Down Mortgage "Rescue" Scam • Indiana Fines Mortgage "Rescue" Firm • Illinois Sues Another Mortgage Foreclosure "Rescuer" • Missouri Sues Foreclosure "Rescue" Business • Illinois Launches Offensive Against Foreclosure "Rescuers" • New York Takes On Predatory Real Estate Scams • Texas Halts Bogus Foreclosure Rescue Operation

Getting a home mortgage modification has proved very hard to achieve so far. So, if a company makes it sound easy and promises they can make it happen, it may be wise to exercise a bit of skepticism.

In Illinois, Attorney General Lisa Madigan has filed lawsuits against three companies she says were operating mortgage rescue fraud schemes. The suits were filed against Loan Mod One, LLC; Freedom Mortgage Team, Inc.; and Living Modifications Corp.

"With home foreclosure rates steadily on the rise, we are working closely with our federal partners to leverage all available resources to stop mortgage rescue fraud," Madigan said. "Homeowners who believe they are at risk of losing their homes need to know that free, legitimate help is available. These rescue fraud schemers are not going to help modify your loan, work with your lender or represent you in court. They’re simply going to take your money and run."

"Victims of fraud"

In New Jersey, meanwhile, nine companies have been cited for allegedly offering loan modification services to consumers without a license.

The nine companies each were cited for violating the state's Consumer Fraud Act for engaging in unconscionable commercial practices by allegedly offering to negotiate mortgage modifications without being licensed as a debt adjuster by the Department of Banking and Insurance.

"Homeowners looking for mortgage help instead are becoming victims of fraud, and risk ending up in a worse situation," New Jersey Attorney General Anne Milgram said. "We want these nine unlicensed debt-adjuster companies to reimburse consumers for fees paid and to comply with our laws."

The Notices of Violation are the latest in an on-going series of actions taken by the Attorney General and the state's Division of Consumer Affairs to protect consumers in the current mortgage and home foreclosure crisis. To date, 11 civil lawsuits have been filed against 102 defendants who allegedly committed mortgage or foreclosure fraud against consumers.

The Division also filed suit against a Lakewood-based firm, United Credit Adjusters, and obtained a court judgment in July that permanently barred the company from performing credit counseling, credit repair or debt adjuster work in New Jersey.

The nine companies each sent a Notice of Violation on November 24 are Affordable Finance, LLC; EZ Financial Solutions, LLC; Home Rescue Today.com' Best Response Loan Mod; Legal Loan Modifications, Inc; Premier Service Consultants, LLC; RJD Consulting, Inc.; United Global Services, LLC; and Xtra Financial, LLC.

Each company has been assessed a $5,000 civil penalty, in addition to making consumer restitution.

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