By James Limbach
August 24, 2010
The owner of Apply2Save, a bankrupt Coeur d'Alene, Idaho, mortgage modification company, that allegedly defrauded hundreds of consumers nationwide is prohibited from ever operating a similar business in Idaho, according to Attorney General Lawrence Wasden.
Derek Oberholtzer entered a settlement agreement with Wasden's office that prevents Oberholtzer from acting as a debt or credit counselor and prohibits him from engaging in mortgage lending, brokering, or modification activities within Idaho or with Idaho consumers.
"Apply2Save operated for less than a year, signed up hundreds of clients, and took in millions of dollars," said Wasden. "Yet few consumers ever received the mortgage modification services they purchased."
"Apply2Save said they could help with my mortgage," Evelyn of Norwalk, CA, writes ConsumerAffairs.com. She says after the company debited her bank account for a $495.00 down payment and did nothing with her case, she was told they had everything they needed, paystubs, financial information etc, and it was good to go. "Two months later," she says, "I called, and nothing was done on my behalf. All that time I thought they were in contact with my mortgage company, instead was told they needed more information and my folder was sitting on someone's desk."
Tresha of Richland, MI, tells ConsumerAffairs.com she gave Apply2Save $500.00 to help save her home from going into forclosure. "Supposedly when they were done we were to give them another $500.00. But we gave up on them because they were stalling and doing nothing."
Wasden sued Oberholtzer and Apply 2 Save in April 2009, alleging the defendants accepted payments from consumers for services that they never performed.
Banned by Boise
In addition to banning Oberholtzer from doing business in Idaho, he is prohibited from obtaining a license to engage in any activity that the Idaho Department of Finance regulates. The settlement with Oberholtzer also incorporates the terms of the Federal Trade Commission's consent decree with Apply2Save, Sleeping Giant Media, and Oberholtzer.
The AG recovered $45,000 in restitution during his investigation of Apply 2 Save and will distribute the money to consumers who filed complaints with the office in 2008 and 2009. Consumers do not need to file new complaints or contact the office. Eligible consumers will receive restitution checks before the end of the year. Status updates regarding this settlement are available here.
Apply2Save and Oberholtzer filed Chapter 7 bankruptcy soon after the state sued. Oberholtzer received a discharge of his debts in April. Apply2Save's bankruptcy is continuing.
For information about Apply2Save's bankruptcy, consumers can call the court's Voice Case Information System at 208-334-9386. If consumers have legal questions about bankruptcy, they should contact a private attorney.
During the prior 16 months, the Attorney General has resolved five cases involving allegations of deceptive mortgage modification activities. The settlements resulted in more than 420 consumers receiving $84,110 in restitution.
"My office received more complaints about loan modification businesses last year than any other type of business," Wasden said. "With foreclosures still at record levels in Idaho, I encourage people facing foreclosure to use the free, professional assistance that is available. Most of the Idahoans we've heard from who paid for mortgage modification services have found that their situation only got worse."