bad loan modification companies

Cox Takes Aim at Advanced Fee “Foreclosure Rescue” Scams

Michigan’s Attorney General Mike Cox, who is at the center of a controversy involving a dead stripper and former disgraced Detroit Mayor Kwame Kilpatrick, became the next wanna-be gubernatorial candidate to jump on the band wagon of going after mod companies for the free publicity.  His office sent out the below press release:

LANSING - Attorney General Mike Cox announced the filing of three criminal complaints and a total of 10 charges against illegal advanced fee “foreclosure rescue” operations accused of defrauding Michigan families of thousands of dollars.

 Global Financial Consulting Services of Dearborn Heights, Advanced Mediation Services of Midland and James Klein of Midland are accused of illegally charging homeowners facing foreclosure upfront fees for mortgage modification assistance.  The defendants claimed they would help homeowners by working with their lenders in an attempt to modify the borrower’s mortgage.  After paying the upfront fee, borrowers found that the companies could not secure a modification and were subsequently unable to get their money back.  

 ”These companies took advantage of Michigan families trying to hold onto the American dream,” said Cox. 

 Global Financial Consulting Services faces four criminal counts including two counts of charging upfront fees before services were rendered, a violation of the Credit Services Protection Act, and two counts of making misleading statements. 

 Advanced Mediation Services and James Klein each face two counts of charging upfront fees before services were rendered, a violation of the Credit Services Protection Act, and one count of making misleading statements.  Each of the charges carries a penalty of up to 90 days in jail and/or a fine of $1,000 in addition to the requirement that the companies make full restitution to each of their victims

 Cox urges any consumers who paid fees to Global Financial Consulting Services, Advanced Mediation, James Klein, or any other mortgage modification company for services that were not provided, to contact the Attorney General’s Consumer Protection Division at (877) 765-8388 or online at www.Michigan.gov/ag.   

 Cox reminds homeowners they can find foreclosure information on his website at www.Michigan.gov/avoidforeclosure.  The website includes contact information for government agencies and debt counselors, and also offers tips for those facing foreclosure, including:

·     Homeowners are never required to pay to speak with their lender or servicer.

·     Homeowners do not need to pay for outside assistance.  Free assistance with foreclosure issues can be found by calling the Michigan State Housing Development Authority at (866) 946-7432.

·     If you do hire outside assistance, never pay up front for help with negotiating your loan or working with your servicer.

 Attorney General Cox has made prosecuting mortgage fraud a priority for his office.  In 2008, Cox created a mortgage fraud unit, teaming with the Michigan State Police and other law enforcement agencies to tackle consumers’ complaints.  Cox’s office has charged 24 people or companies with a mortgage fraud-related offense in the last 12 months alone.  Cox’s office also conducted several mortgage foreclosure forums to help families stay in their homes during these difficult times.

 In addition to today’s charges, Cox announced that he has partnered with the Federal Trade Commission and delivered Notices of Intended Action (NIAs) to 13 out-of-state companies accused of illegally demanding upfront fees from Michigan consumers for loan modification services. 

 If the targeted companies fail to contact the Attorney General’s Office to create a plan to provide restitution to Michigan consumers, the Attorney General may file a civil suit against them in order to recover damages.

 The companies receiving NIA warnings from Cox today include 1 Global Financial, Inc., of Fort Lauderdale, FL; 21st Century Legal Services and Fidelity National Legal Service, of Rancho Cucamonga, CA; Best Interest Rate Mortgage, of Westmont, NJ; Echo Loans & Financial Solutions, of Foothill Ranch, CA; Elect Group LLC, of Oakland Park, FL; Federal Home Savers, of Commack, NY; Fresh Start Home Modification, of Woodbury Heights, NJ; Hope N Housing, of Norwalk, VA; IMC Financial, of Clearwater, FL; Lifeguard Financial, of Fort Lauderdale, FL; National Modification Corp., of Hauppauge, NY; North American Relief, LLC, of Costa Mesa, CA; and Peoples First Financial Inc., of San Diego, CA.

 A criminal charge is merely an accusation, and the defendant is presumed innocent until and unless proven guilty.

bad loan modification companies

Business Insider: Bank of America-Worst Bank EVER!

Joe Weisenthal, Business Insider Nov. 10, 2009, 1:42 PM

 The Treasury is out with its always-interesting look at the state of mortgage modifications.

 In order to make it look like the program is accomplishing a lot more than it is, it always runs the latest version of this chart, which makes it look as though the program is steadily growing each month. Well, technically it is, but the chart shows cumulative mortgage mods, so the latest bar is always going to be higher than the last. It really tells you nothing about the program’s real growth…

http://www.businessinsider.com/bank-of-america-is-the-stingiest-big-bank-when-it-comes-to-mortgage-modifications-2009-11

bad loan modification companies

Florida AG Investigates BofA After Getting 452 Complaints About Modifications

It appears Bank of America is up to old tricks again.  452 homeowners in Florida have filed complaints with the Florida Attorney General’s office claiming that Bank of America were jerking them around about modifications.   Read the below article from the south Florida Sun-Sentinel

Hundreds of complaints about Bank of America have been filed with the Florida attorney general over mortgages and stalled loan modifications. Other major lenders have few complaints

 By Harriet Johnson Brackey South Florida Sun-Sentinel

October 29, 2009

Hundreds of struggling Florida homeowners have filed complaints with Florida Attorney General Bill McCollum in the past year about failed or stalled home mortgage loan modifications with Bank of America.

Angry borrowers, desperate to hold on to their homes, say they’ve made dozens of calls to their lender and spent months asking for a change in their loan terms, only to be denied or to learn that Bank of America revoked their loan modifications a few months after they reached a deal.

“I wrote letters to the governor, I called the bank every single month,” said Yvonne McBride, a disabled former state worker who received a loan modification for the Sunrise home she shares with husband Herman Acosta. But the bank retracted the deal …

 http://www.sun-sentinel.com/business/sfl-loan-modification-103009,0,2675667.story

bad loan modification companies

FOX 5 in NY Nails The Scumbags At Amerimod

Hopefully Andrew Cuomo can throw these guys behind bars soon. 

See the piece here:

http://www.clipsyndicate.com/video/play/1098979/foreclosure_rescue_company_lawsuits

bad loan modification companies

CT & FL AG Targets 2 Mod Companies Claiming Partnership With Law Firms

Diane Lade of the  South Florida Sun-Sentinel wrote an article about how the Connecticut and Florida AG’s offices are investigating First Legal/Nationwide Home Relief.  The Florida AG is investigating both First Legal/Nationwide Home Relief and Housing Assistance Law Center. 

http://www.sun-sentinel.com/business/custom/consumer/sfl-sfl-foreclosure-law-082309sbaug23,0,6462732.story?page=1

The Florida Bar posted an advisory back in March advising attorneys what they can and cannot do when doing business with modification companies:

ETHICS ALERT:

PROVIDING LEGAL SERVICES TO DISTRESSED HOMEOWNERS

 The Florida Bar’s Ethics Hotline recently has received numerous calls from lawyers who have been contacted by non-lawyers seeking to set up an arrangement in which the lawyers are involved in loan modifications, short sales, and other foreclosure-related rescue services on behalf of distressed homeowners. These non-lawyers include mortgage brokers, financial management advisors, foreclosure “consultants” and others who engage in foreclosure related rescue services or other similar services. Non-lawyers have proposed a variety of agreements, even offering to hire lawyers as “in-house counsel” to provide services to the non-lawyer’s customers. The Foreclosure Rescue Act, Section 501.1377, Florida Statutes, went into effect October 1, 2008 and imposed restrictions on non-lawyer loan modifiers to protect distressed homeowners. The new statute appears to be the impetus for these inquiries.

Lawyers should be wary of these proposals, as many violate the ethics rules and may subject the lawyer to discipline. Florida Bar members:

• Cannot pay a referral fee or give anything of value to a non-lawyer for referring distressed homeowners to the lawyer. [Rule 4-7.2(c)(14)]
• Cannot be paid by a non-lawyer to provide services to distressed homeowners. [Rule 4-5.4(a)]
• Cannot directly or indirectly divide fees with a non-lawyer. [Rule 4-5.5(a)]

 Cannot assist in the unauthorized practice of law by:

• providing legal services for a distressed homeowner while employed as in-house counsel for a non-lawyer company;
• forming a company with a non-lawyer to perform foreclosure related services if any of the services are the practice of law; or
• assisting a non-lawyer individual or company in providing services that the individual or company is not authorized to provide or are otherwise illegal.

[Rule 4-5.5(a)]

• Cannot assist a non-lawyer in violating the provisions of the Foreclosure Rescue Act, Section 501.1377, Florida Statutes. [Rule 4-8.4(d)]
• Cannot directly contact distressed homeowners to offer representation (including by telephone or facsimile) and cannot allow someone else to directly contact distressed homeowners on the lawyer’s behalf. [Rules 4-7.4(a) and 4-8.4(a)]
• Cannot accept referrals from non-lawyers acting in the guise of a “lawyer referral service” (legitimate lawyer referral services must comply with a rule which requires all advertisements and contact with prospective clients to be in compliance with the attorney advertising rules, in addition to other requirements) [Rule 4-7.10]
• Must have a direct relationship with distressed homeowners who hire the lawyer for representation. [Rules 4-1.1, 4-1.2 and 4-1.4]
• Cannot allow a non-lawyer to choose a lawyer for a distressed homeowner or direct a lawyer’s representation of a distressed homeowner. [Rules 4-1.1, 4-1.2, 4-1.4, and 4-5.5(a)]

 Several ethics opinions, Opinions 92-3 and 95-1 in particular, discuss similar proposals and the ethics problems that arise when lawyers enter business arrangements with non-attorneys. These opinions can be accessed on the Florida Bar’s website by selecting “ethics opinions” then “list of Florida Ethics Opinions by number.”

 This alert does not address every potential problem or concern. Lawyers should not assume that conduct is permissible merely because it is not listed above. If you are a Florida Bar member with specific questions about your own conduct related to this type of situation, you should contact The Florida Bar Ethics Hotline at (800) 235-8619.

 This alert also does not address the issue of what conduct by non-lawyers is permissible. Questions regarding whether conduct of non-lawyers constitutes the unlicensed practice of law should be directed to The Florida Bar Unlicensed Practice of Law Department at (850) 561-584

bad loan modification companies

Andrew Cuomo To Amerimod: Arrivederci, Baby!

NEW YORK, NY (August 13, 2008) – Attorney General Andrew M. Cuomo today announced that his office has filed a lawsuit against New York-based American Modification Agency, Inc. (“Amerimod”), one of the largest foreclosure rescue companies in the country, and its owner Salvatore Pane, Jr. for engaging in a wide variety of deceptive business practices and false advertising to induce beleaguered homeowners on the brink of foreclosure to sign up for their services. Today’s lawsuit is part of Cuomo’s ongoing investigation into foreclosure rescue scams that target New York homeowners.

Attorney General Cuomo’s investigation into Amerimod revealed that while claiming to modify home mortgage loans and lower monthly payments of consumers on the brink of foreclosure, Amerimod typically falls short on its promises. In fact, after Amerimod collects illegal, up-front fees, the homeowners often find themselves in worsened circumstances with respect to their mortgages and unable to obtain accurate information from Amerimod’s representatives or other customer service. The lawsuit seeks refunds and damages for Amerimod’s customers who were charged illegal up-front fees and were deceived by the company’s empty promises, misleading representations, and false advertising. It also seeks to shut down the company’s New York operations.

“Amerimod shamelessly took advantage of thousands of vulnerable homeowners desperately trying to save their homes,” said Attorney General Cuomo. “By charging up-front fees and making misleading and deceptive claims about its ability to prevent foreclosure, Amerimod blatantly ignored the law and tried to squeeze the last dollars from struggling consumers nationwide. My office is determined to obtain relief for these individuals and families, and to prevent Amerimod and other foreclosure rescue companies from continuing to engage in this kind of unlawful conduct.”

The lawsuit asserts that Amerimod:

• Fails to obtain loan modifications for the vast majority of its customers, many of whom end up in foreclosure or negotiate loan modifications on their own.
• Illegally charges thousands of dollars in up-front fees, and fails to refund these fees as promised when loan modifications are not obtained.
• Engages in deceptive and misleading practices by grossly exaggerating its success rate, making false promises about its ability to save customers’ homes, underestimating the amount of time it takes to achieve a loan modification, and misrepresenting that the company is a law office and that lawyers will work on customers’ files.
• Makes false guarantees of 100% customer service when, in fact, once Amerimod has collected its up-front fees, its representatives often fail to return calls of customers facing imminent foreclosure who are desperately seeking a status update on their files.
• Makes false and misleading statements on its website, in newspaper advertisements, and in radio advertisements.
• Fails to include legally required disclosures and notices in its customer contracts, including notice of a customer’s right to cancel a contract within five business days.
• Provides detrimental advice to customers, such as recommending that they stop making monthly mortgage payments, ignore communications from their lenders and avoid consulting with non-profit housing counseling agencies.
• Targets Spanish-speaking consumers who are signed up by Spanish-speaking representatives, and then fails to provide the consumers Spanish-language contracts as required by law.

Amerimod’s central office is in Uniondale, NY, and it has had more than ten branch offices throughout the state, as well as offices in various states throughout the United States. The lawsuit seeks a court order directing Amerimod to stop marketing and providing loan modification services in New York State, provide an accounting of customer fees, pay refunds and damages to all injured customers, and pay monetary penalties to the State.

The lawsuit against Amerimod is part of Cuomo’s wide-ranging investigation into the so-called “foreclosure rescue” industry. To date, Cuomo’s office has issued subpoenas to 18 other loan modification companies that have targeted New York homeowners facing the risk of losing their homes.

For more tips, see the Attorney General’s brochure, “Avoid Foreclosure and Rescue Scams”: http://www.oag.state.ny.us/features/foreclosure_rescue_scams/brochure_download.html.

The lawsuit against Amerimod is being handled by Special Counsel Mary Alestra, Assistant Attorneys General Brian Montgomery, Laura Levine, and Stephanie Sheehan, and Senior Enforcement Counsel David Holgado of the Bureau of Consumer Frauds & Protection under the supervision of Bureau Chief Joy Feigenbaum.

bad loan modification companies

Jerry Brown is Cracking the Whip on Mod Companies

The California AG’s office has started a new site about fraudulent modification companies.  You can see it here:

http://ag.ca.gov/loanmod/

The AG’s office also sent letters to the 386 modification companies that have not posted their $100,000 bonds as required under California law.  They must file a bond within 10 days or face up to a year in jail or a $25,000 fine.

You can see who they are here:

http://ag.ca.gov/cms_attachments/press/pdfs/n1780_registry_list.pdf

One of the people on that list is Barnhart Capital run by Beau Barnhart.   His other company, New Beginnings LMS made our Top 20 Worst Mod Company list back in March.   

The AG also sent out a letter to Emodifymyloan.com’s President Chris Mozillo (yes, Angelo’s nephew) demanding they substansiate their advertising claims within 20 days.

bad loan modification companies

California DRE Updates Desist & Refrain List Against Mod Companies

You can see it here:

http://www.dre.ca.gov/cons_drs.asp

bad loan modification companies

From The Land of Fruits and Nuts Arises a Queen

Since starting MFI-Miami last June and MFI-Mod Squad in January 2009, I have seen a lot of messianic types with delusions of grandeur spring up. They claim to be consumer watch dogs or fraud fighters. They usually come and go like minor characters in a daytime soap opera.

These self proclaimed fraud fighters also have narcissistic revenge fantasies. They believe they’re not at fault for losing their homes. They rant on the Internet and are usually gone in a month or two.  I usually ignore these people, but I do respond when someone posts blatant lies about MFI-ModSquad.com and my companies.

Last week, a site called Bad Biz Finder posted a story about MFI-ModSquad and MFI-Miami.  In the story, the allegedly anonymous owner wrote that I told her “decoy” that my friend Pat Pulatie (LoanFraudDetective.com) ran my California operation.

I’ve never had a California operation and never claimed to have one. The owner of Bad Biz Finder also claimed that loan modification companies like CDA Law Center pay me to get my seal of approval. She doesn’t believe that I pay for this site out of my own pocket. To this, I say prove it. If not, then in the immortal words of Eric Cartman of South Park, ‘Shut your pie-hole!’”

Who is the anonymous blogger from Bad Biz Finder who claims she must remain anonymous because she fears incurring bodily harm? Her name is Erin Baldwin.

Who is Erin Baldwin? She own The Baldwin Companies and Baldwin Business Consulting, which operates at 24310 Moulton Parkway, Ste. 536, in Laguana Hills, California.

What does Baldwin Business Consulting do?  According to the press clippings on the site, Erin — the owner — charged her clients $5000 dollars to write a business plan using a template from an office supply store and then introduced her clients to several bankers to get them a business line of credit for $30,000.

All this seems fine.  However, the going rate for writing a business plan is under $500 and, up until last year, banks were giving $30,000 lines of credit to anyone with a pulse and decent P&L statements. The going rate for using a commercial broker, if you needed one, for these lines was $1000.  She only made introductions to the banks to sidestep California regulations, which require commercial brokerage houses to be licensed.

So, how was Erin able to charge three times the going rate? She flirted with potential clients and told people that she attended Merrimack College and Harvard University. I guess those community education classes make nice padding for the resume because the people with whom I spoke have no record of her attending or graduating from either school.

So what qualifies Erin to be a wannabe Power Puff Girl? On Bad Biz Finder, she claims: “We here at Bad Biz Finder are a Consumer Advocate Group that has been around since the 1980s and we stay anonymous because we have been threatened in the past…” This is simply not true.  The state of California has no record of her or any of her companies being a consumer advocacy group. Baldwin Business Consulting has, by Erin’s own admission, only been around since 2003. Besides, threats are part of this business. I get an average of 5-6 of them per week.  Erin tries to remain anonymous because she doesn’t want people to dig into her past and discover that she’s a fraud.    She did exactly what she is accusing modification companies of doing.

So what’s the real story?  When the recession came, Erin’s ability to overcharge her clients disappeared faster than 100% financing with a 600 FICO. The problem was that she bought a seven-figure house in Costa Mesa during the boom and, when the recession hit, she was upside down and couldn’t afford it.

She lost her Barbie Dream House to foreclosure and, due to the fact that she bought her home using stated income, she was rejected for a modification by her lender. Now she uses this as her justification for going on an Aileen Wuornos-style killing spree against the modification industry.

In January, Erin posted a rant accusing Erik Duckworth and Jeff Davi at California DRE of taking bribes and kickbacks from Parsa Law Group. It appears that she didn’t like DRE’s investigation. But, when DRE requested assistance from her, she wrote: “However, the safety of our volunteers, the tactics we have in place and the consumers that are counting on us to place their interest first and foremost would be severely handicapped if we were to simply turn over all our information to the DRE.”

In other words, Erin didn’t have any information and DRE considered her an unreliable source.

Erin, listen to someone who actually knows what he’s doing. Anonymous bloggers have no real credibility. Only gullible consumers believe everything they read on the Internet. When state regulators or law enforcement officials ask for your assistance, give it to them without hesitation. By cooperating with the authorities, you can build credibility and be recognized by the national media as an expert in your field.  Also, shelling out $10 to register a domain name goes a long way toward making you credible.

After Erin posted her rant, Parsa Law Center filed a libel suit against her. Feldman Law Center also filed one against her as well.  She was even warned by Wordpress CEO Toni Schneider to tone down her rhetoric or he would pull the plug on her blog. All that did was infuriate her even more. Here’s her email response:

“Yes we are exposing fraud and thank God we are exposing the fraud. We’ve received thousands of thank you emails because of it. Somebody has to do it and so far no one is stepping up to the plate. Why did you start WordPress anyway? Don’t you believe in free speech? Isn’t it a free service to allow people to express themselves freely?
You cannot be an agent for change BY BEING APPROPRIATE. You’re going to ruffle some feathers along the way. How have you handled controversial blogs in the past? Did you shut them down? Did you censor them? Did you violate their constitutional rights? We’re sincerely interested in knowing the answers to these questions.
THERE ARE NO LEGITIMATE BUSINESSES REVIEWED ON OUR BLOG. If you read our posts you would see that all of our claims are substantiated. Please point out one that isn’t. The people that are flipping out are flipping out because they’ve been caught with their pants down and it’s humiliating and expensive to their scam.
Please email us the sections of your “terms of service” that allow you to censor us and violate our constitutional rights.
The Supreme Court of the United States of America has stated that:
“ABOVE ALL ELSE THE FIRST AMENDMENT MEANS THAT GOVERNMENT HAS NO POWER TO RESTRICT EXPRESSION BECAUSE OF ITS MESSAGE, ITS IDEAS, ITS SUBJECT MATTER, OR ITS CONTENT.” Police Department of Chicago V. Mosley (1972). Government rules by the law, and the law is decided in court, and the court is who must decide any matter pertaining to this subject. Your terms of service have no authority over The Supreme Court and the Constitution of the United States of America.
So stop hassling us.
Bad Biz Finder

This email is interesting because, for all the talk about her rights under free speech, she doesn’t allow opposing views on her blog. I guess she only believes in free speech for herself.

The problem with people like Erin Baldwin is that she believes that because she went through the foreclosure process, she’s an expert in foreclosure rescue or modifications. If you use that logic, you should be able to qualify for the Indy 500 after watching Speed Racer cartoons.

Erin will probably go on some Wagnarian rant on her site about this article but let her.  Her anonymity and fictitious resume have been exposed.

If you think her insane rants about the modification industry make great fiction you should read what she writes about her landlord because they towed her car for illegal parking but that is another story.

bad loan modification companies

The List of Foreclosure Rescue Companies Under Investigation By The Florida AG

The Florida AG’s office announced the following foreclosure rescue companies are currently under investigation:

A Realty RX, LLC
Attorney Debt Services, LLC dba Homekeeper USA
B Home Associates, LLC dba Expert Foreclosure
Federal Foreclosure Prevention, LLC
FHA All Day.Com, Inc.
FL Loan Mod.com and or Deep Creek Realty
FMA Servicing Inc., a/k/a Financial Management Advisors, a/k/a www.fmafinancial.com, and a/k/a Financial Management Services
Foreclosure Alternative Services, LLC
Foreclosure Help Center, Incorporated
Foreclosure Law Group / Foreclosure Stoppers / Foreclosure Mediation Services
Foreclosure Services of America, Inc. d/b/a Fix The Foreclosure, Inc.
Francis C. Reeder, an individual
Home Assure, LLC
Home Mitigation Direct, LLC
Hope Now Foundation/The Treasurer, LLC
Integrity Real Estate Services, Inc. / Integrity Foreclosure Solutions
JAJ Consulting Services
Law & Associates, LLC, Thomas E. Law II
Lincoln Lending Services, LLC
ModExperts, LLC
Mortgage Crisis Solutions Association, LLC Property Solutions Specialists, Inc.
Mortgage Modifiers, LLC
Mortgage & Refinance Solutions, LLC dba Mortgage & Refinance Solutions
NATIONAL FORECLOSURE COUNSELING SERVICES CORP.
National Foreclosure Management, Inc.
National Foreclosure Mediators, Inc. / Home2Mortgage
National Payment Modification Company a Florida corporation, and The Gordon Law Firm, a California Law Firm
Oceanview Investment Services, Corp. Oceanview Financial Services, Corp. Financial Powerhouse Services, Inc.
Statewide Foreclosure Solution
Strong Family Fund, Inc
Three Angels Community Action Network, Inc. a/k/a 3ACN
US Settlement Services, Inc
Victor Lopez & Associates,Inc.
Wendy Smith Real Estate
Wineberg Lopez & Rodriguez Company (formerly Winberg, Lopez, & Rodriguez Company a/k/a Wineberg, Lopez & Rodriguez, P.A.) Freddy W. Lopez, Sr. and Wiliam R. Rodriguez, Jr.
You Walk Away, LLC d/b/a youwalkaway.com

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