California DRE

California Department of Real Estate Revokes Record Number of Real Estate Licenses

SACRAMENTO, Calif. – (Business Wire) The California State Department of Real Estate (DRE), the state department that issues licenses to real estate professionals and protects consumers in real estate transactions, revoked a record number of real estate licenses for cause in 2009. The DRE also accepted another record number of license surrenders from licensees facing disciplinary action. All told, over 775 licensees had their license revoked or simply surrendered their licenses while facing accusations. Over the past two fiscal years, the DRE averaged 446 license revocations and 59 license surrenders. In 2009, license revocations jumped over 50%, to 672, while license surrenders jumped nearly 80% to 105. The 122 cases that resulted in license suspensions in 2009 remained relatively unchanged from the 125 license suspensions averaged in the past two fiscal years.

The down turn in the real estate market is a big reason disciplinary actions are up. “With so many people struggling to stay in their homes, foreclosure rescue and loan modification scams have risen dramatically,” DRE Commissioner Jeff Davi said. “And what is even more unsettling, a majority of offenders involved in loan modification scams are not even licensed, which limits a consumer’s ability to obtain restitution or verify the legitimacy of a business,” Davi added.

In 2009, the DRE initiated over 2,000 investigations involving loan modification complaints, which represents 25% of all cases set-up. The DRE issued over 180 Desist and Refrain orders to nearly 348 different respondents performing loan modification services, ordering them to stop or change their business practices. Of the 348 Desist and Refrain order respondents, approximately 60% were not licensed and ordered to cease licensed activity – which included offering loan modification services. In addition, nearly 100 real estate licensees have been accused of violating the real estate law in connection with loan modification complaints. Many of the completed cases have been referred to law enforcement agencies for criminal prosecution.

In order to help inform consumers to stay away from the bad actors, the DRE posts on its website all the recipients of Desist and Refrain orders and Accusations in loan modification complaints along with a copy of the order.

In addition, before engaging the services of a person to perform real estate services, consumers should verify the status of the person’s real estate license by visiting the DRE’s website. The benefits are twofold. First, a license status check can tell you if the person is licensed, how long he or she has been licensed, and whether the licensee has been previously disciplined or is facing disciplinary action. Second, a consumer who is defrauded by a licensee and obtains a fraud judgment in civil court, but is unable to collect on the judgment, may be able to receive restitution from the DRE. The DRE administers a recovery account for fraud victims that can pay a victim up to $50,000 for a transaction. The payout from the recovery account is capped at $250,000 for each licensee. Those victims who have been defrauded by unlicensed perpetrators cannot make a claim against the department’s recovery account.

California DRE

Loan Company Goes Dormant, Hundreds Could Lose Homes

A local loan-modification company is going out of business, potentially leaving hundreds of homeowners in jeopardy of losing their homes.

 By ANA GARCIA and FRED MAMOUN, NBC News Los Angeles

Updated 8:25 AM PST, Thu, Nov 19, 200

 Hundreds of homeowners who turned to an Orange County mortgage-modification company for help may be in jeopardy themselves and don’t know it. The company appears to have shut down.

 Company insiders say they have come forward to warn the public because they’re afraid people will lose their homes. 

 Greenleaf Legal Services in Mission Viejo may bill itself as “loan-modification experts,” but during a recent visit, the place was a ghost town.

 Some offices were empty, others had stacks of client files apparently waiting to be worked on, and telephone message…

 http://www.nbclosangeles.com/around-town/real-estate/Greenleaf-Legal-Services-Mission-Viejo-Loan-Modification-70424972.html

California DRE

GCS Shuts It’s Doors

After hearing official word of Green Credit Solutions’ collapse yesterday, I remembered Act 3 Scene 2 of Julius Caesar. In that part of Shakespeare’s famous play, Anthony declares: “I come to bury Caesar, not to praise him. The evil that men do lives after them. The good is oft interred with their bones…”

Like Caesar, Green Credit Solutions (GCS) had more successes than failures.  Their detractors and critics want to judge them by their failures.  GCS successfully completed almost 3500 loan modifications. Only 700 people complained to the California Department of Real Estate (DRE) and fewer than 150 people were found to have valid complaints.    They closed their doors because of the new laws that went into effect that regulate mod companies in California and felt that it was easier shut down then deal with the state.

 Most of the complaints DRE received were from homeowners who couldn’t have been helped with loan modifications. These homeowners were in stated income loans or no-doc loans because they require no proof of income or proof of assets. Not a single lender will modify this particular type of loan due to the high risk factor. As a result, there are high foreclosure rates in both California and Florida.

 Homeowners were forced into stated or no-doc loan programs in order to qualify for mortgages. Home values were highly inflated at the time when these loans were issued. Instead of renting for a few more years or buying a home that wasn’t as expensive, some people over-borrowed to buy a dream house.

 Our society has turned the American Dream into a nightmare.  Americans have become all five children from Charlie and the Chocolate Factory wrapped into one.  So, when something doesn’t go their way, they point a finger at someone else and cry: “I’m a victim!”  I constantly hear from loan mod company owners in Florida that homeowners are never satisfied. Recently, a mod company owner told me: “Homeowners, having become accustomed to not having to make a payment for six months or a year, now realize they have to start paying and refuse the modification.”

 If these homeowners don’t get what they think they’re entitled to, they complain on the Internet. Even though there are people with legitimate complaints against companies like Green Credit Solutions, there are complaints in every industry. That’s especially true of the lending industry and loan modification industry. 

 When I endorsed GCS in April, I received email messages from people accusing me of taking kickbacks and bribes, doing faulty research and not being a “good Consumer Advocate”. They were shocked that I would actually say something nice about a mod company. Let’s set the record straight.  Unlike unemployed former loan officer and blogger Krista Railey or former failed drug dealer, Moe Bedard who want people to think they’re the next Ralph Nader. I am not a Consumer Advocate and never professed to be one. GCS was taken off the 20 Worst Mod Company list because Larry Bracco of GCS, completed the list of tasks that I gave him including GCS refunding fees to satisfy clients. Those clients were very happy with what he did for them. 

I also asked a friend from the loan modification industry to visit GCS and give me his input. He traveled to the company’s offices. Columnist Martin Andelman did, too. Everyone who visited GCS gave me positive feedback about the company. Larry Bracco also showed copies of successful loan modifications to me and Martin Andelman, and he let us speak to dozens of GCS’ clients. 

There is one person dancing a jig on the grave of GCS, and that is Moe Bedard.  On his Website, loanworkout.org, Moe posted a comment in which he called GCS “clowns.” I think this is kind of odd since he operated a fraudulent loan modification company named Loan Safe Solutions for almost 18 months after DRE revoked his license for “moral turpitude.”  You can read all about here:

http://www.mfi-modsquad.com/would-you-hire-this-guy-to-do-your-loan-mod

How many lives did you ruin selling drugs, Moe?  How many people got screwed when you abandoned Loan Safe?  The difference between GCS and you, Moe, is GCS actually had a DRE license until May when they let it expire.     They didn’t try to sidestep California law to hide felony convictions like you did.

California DRE

Is the California DRE Even Relevant Anymore?

Since starting MFI-Mod Squad back in January, I have witnessed a lot of craziness from illegally-run loan modification companies. They’re often staffed by convicted felons, unlicensed lawyers, or government bureaucrats who confuse motion with action. 

 This has been most prevalent in California, which became a mecca for illegally-run and shady loan modification companies within the past twenty-four months. Under California statute, enforcement of the regulations that govern mortgage lending and modifications was the responsibility of the Department of Real Estate (DRE). 

 From November 2007 until September 2008, DRE did nothing to reign in the loan modification industry. It wasn’t until complaints began pouring in about these companies that DRE began requiring modification companies who charge an advance fee to have an advance fee agreement on file with them. That, however, didn’t stop the unethical practices committed by the vast majority of these companies. DRE’s advance fee requirements were hardly enforced.

 A perfect example of this was Loan Safe Solutions. The company was operated by Moe Bedard, a convicted felon whose DRE license was terminated when he was incarcerated. Bedard began Loan Safe Solutions after he left prison and operated it until May 2009, when his company lost its office space through eviction. It was commonly known in the modification and lending industry since the spring of 2008 that Bedard was operating outside DRE guidelines, but DRE did nothing. 

 See http://www.mfi-modsquad.com/would-you-hire-this-guy-to-do-your-loan-mod

 There are other shady companies that DRE did nothing to punish. Federal Loan Modification is another example. It was finally shut down after it was fined to death by the Federal Trade Commission (FTC). The FTC acted after being grilled by reporters about MFI-Mod Squad’s list of the twenty worst loan modification companies, which was published in April.

 See http://www.mfi-modsquad.com/bad-loan-modification-companies

 It wasn’t until early this year that DRE initiated a statewide dragnet against these companies because DRE was trying to keep the Governator’s bean counters at bay. Schwarzenegger’s people were looking for ways to do budget cuts and eliminate California’s massive $38 billion deficit. 

 Though good for a few blurbs on the Internet, this dragnet did little to actually scare these companies, which were working with equally unscrupulous law firms. 

 Due to actions initiated by other entities, the situation did eventually improve over the past several months. The California Attorney General’s office stepped in and began filing lawsuits against loan modification companies and requiring that $100,000 surety bonds be filed with their office.  The State Bar of California elected a new president. Her core mission was to bring integrity back into the legal profession, beginning with attorneys who charged advance fees for loan modifications and then failed to perform any work on the files. 

 Then, of course, SB 94 was introduced and was then signed by Schwarzenegger last week.  

With all these issues, is it fair to ask if DRE is even relevant? If they are, how can they be made more effective? Do they need new leadership and a new mandate?

California DRE

Sorry California, Your Right To Legal Counsel Is About To Be Taken Away!

By Martin Andelman

What do you call 500 lawyers at the bottom of the ocean?  A good start.

Very funny stuff, right?  Unless, of course, you’re being sued… or you’re charged with a crime… or you’ve just been fired without cause… or if your spouse just walked out after 20 years… or if you’ve been cited for Driving Under the Influence… or harmed as a result of another’s gross negligence.  When you need an attorney to enforce or otherwise protect your rights, you’re not laughing at lawyer jokes nearly as much.  In fact attorneys, I would imagine, get hugged a lot too… maybe just as often as they’re made fun of, I don’t really know.

From its very beginning, American society has been based on law… and forged by lawyers.  Our lawyers have been charged with setting our nation’s values—through the “landmark cases” that brought major reforms, and through the trust in a lawyer’s day-to-day dealing with his or her clients.  In point of fact, our lawyers must be the conscience of our legal system, and of the people—because if not them, who?

It occurs to me that there are certain professions that we need to trust in our society, and attorneys are one of them.  Police officers are another and physicians a third.  Police brutality, for example, is seen as being the very serious offense that it is, not solely because of its victims, but because it threatens to teach a segment of society that the police cannot be trusted.  And that can be a very dangerous thing.

Police officers, for the most part, are looking out for our safety and if we don’t trust them, it’s quite possible that we could be harmed as a result, perhaps fatally harmed.  And physicians are another group of professionals that in general we need to trust, because if we don’t, we put our health at risk.

Attorneys are a profession that we need to trust when we need them.  We trust that what we tell our lawyer is “privileged,” meaning that our lawyer is prohibited from disclosing whatever we’ve said to others. And it’s important that we trust this to be the case, because if we can’t tell our lawyer the truth, he or she may not be able to provide us with a proper defense and we may be deprived of life, liberty, or property as a result.

Yet, here in California, the legislature is dangerously close to passing a bill that would establish quite clearly that lawyers… all lawyers… are individuals not to be trusted.  And even more so, that attorneys in large number are the type of criminals that left unchecked would plot to steal $3,000 from homeowners distressed as a result of being at risk of losing their homes.

The bill in question, California Senate Bill 94, which was proposed by Banking & Finance Committee Chair, Senator Ron Calderon, was originally designed to prevent a company or individual from charging an upfront fee when offering to help a homeowner avoid foreclosure by working with his or her lender or servicer to obtain an agreement to modify the terms of his or her mortgage.

Now widely referred to as “loan modifications,” there is little question that few homeowners knew of such terminology just a few years ago.  But as the foreclosure crisis steadily tightened its grip on California homeowners over the last 18 months, the term loan modification has quickly become a part of the lexicon.

Initially, many who had been employed in the mortgage industry prior to its meltdown, seeing it as a variation of a refinance transaction, entered the completely unregulated field, and predictably problems ensued.  And although neither the precise cause, nor the extent of these problems has been ascertained, there is no question that some percentage of the operators of these early loan modification companies were unscrupulous con artists who defrauded homeowners out of several thousand dollars by promising to save their homes from foreclosure.

How many scams took place?  No one is certain, but any number is too many according to some.

The State of California’s response was less than coordinated.  The Attorney General and Department of Corporations was one possibility for regulation and enforcement, the California Department of Real Estate was another, and when law firms entered the picture, the California Bar Association was a third.

The initial front-runner was the Department of Real Estate, who introduced their “Advance Fee Agreement,” beginning in October of 2008.  The idea was simply to allow licensed individuals to accept a fee in advance, but required that fee to be placed in a trust account and only withdrawn as earned.  Months later, the Attorney General introduced the requirement that individuals post a $100,000 bond in order to operate as a foreclosure consultant.

Law firms, however, who were already well regulated and under the jurisdiction of the California Bar, remained law firms and presumably functioned as such.

Then, beginning in late 2008 and into early 2009, the California Bar started to receive an inordinate number of complaints each month, between 900-1100, and the sheer number in addition to the allegations was troubling to say the least.  It seemed that some attorneys were allowing firms to operate under their license to practice law, but no law was actually being practiced at the organization in question.  Mortgage brokers had realized that one way around the DRE’s Advance Fee Agreement, which limited the cash flow a company could utilize, was to become an “attorney backed firm,” a hybrid with no basis in law or business convention.

The California Bar sent out an Ethics Alert in February of 2009, warning attorneys that the Bar Association did not condone such practices, and that any attorney involved in such a scheme could be at risk of losing their license to practice law.  The Bar faced a significant problem with the volume of complaints, however.  An attorney had to read each complaint to determine what type of allegation each contained and having never before received anywhere the number being received, they were dramatically understaffed.

Then in February of 2009, Senator Calderon introduced SB 94 and the committee meetings began.  The bill passed through the Senate Banking and Judicial Committees in May and Senate Appropriations in early June.  The bill as written at that time would prohibit mortgage and real estate licensed individuals from accepting advance fees in connection with a loan modification, but attorneys were largely exempt.

Then, just days before July 4^th, with the California Assembly’s Committee on Banking and Finance scheduled to hold a hearing on a similar bill (AB 764) on July 6^th, the bill was amended to ban attorneys from accepting any fees or retainers in advance when representing a client in connection with a loan modification.

The negotiations to obtain a loan modification were widely believed to be 3-4 weeks… but in truth often required 5-9 months, and as a result, the effective outcome of SB 94 and/or AB 764 would be that no attorneys could afford to take on a client who was seeking representation in the negotiations with their lender.  And this would effectively deprive California’s homeowners from being able to engage legal representation.

Attorneys who defend the most unpopular accused persons are especially important.  The more heinous or unpopular the offense, the more necessary the right to counsel, and one of the hazards of pre-trial publicity is that the jury pool can become “tainted”.  Newspaper articles, talk shows, the many opinionated programs on cable television can all serve to poison the public against a defendant… and in this case the defendant is the legal profession, access to which is now crucial to hundreds of thousands of homeowners if they are to remain in their home.

One of the most misunderstood phrases in literature is from Shakespeare.  Shakespeare’s exact line, ”The first thing we do, let’s kill all the lawyers,” was stated by Dick the Butcher in ”Henry VI, Part II”.  Dick was a follower of the rebel Jack Cade who thought that if he disturbed law and order, he could become king.

Shakespeare meant it as a compliment to attorneys and judges who instill justice in society.

To pass into law a piece of legislation that so clearly, thoroughly and seriously maligns the legal profession, based on allegation and innuendo would cause our society harm that could conceivably last for generations.  To believe that attorneys in large number are defrauding distressed homeowners out of $3,000 fees for work that can take many months to complete, stretches the imagination past the point of credulity.

Most notably, CNNMoney.com recently asked homeowners who attempted to obtain a loan modification through the HAMP program WITHOUT ASSISTANCE OF ANY KIND to write in and share their experiences.  Well over 500 letters were received and the overwhelming number expressed intense feelings of extreme dissatisfaction and disappointment.

Additionally, in the last two weeks, we have all learned that banks and servicers have not fulfilled their promises to modify mortgages per the agreed to terms of HAMP, much to the administration’s chagrin.  Treasury Secretary Geithner and President Obama have both admitted the program has not worked effectively and now promise tighter controls.

A review of the complaints received by CNN.com clearly shows that those losing their homes and unable to obtain the help promised by the administration are crestfallen and angry at the failure of their government.

To effectively brand attorneys as untrustworthy thieves and scammers, based on complaints that to this date remain unread, in light of the recent evidence and testimony in Congress, would be unconscionable and result in irreparable harm to California’s homeowners and potentially all Americans who need access to legal representation today, perhaps more than ever before in our nation’s history.

I urge you to speak out immediately against this poorly conceived legislative proposal that would effectively deprive homeowners in California from their right to counsel and damage the reputations of attorneys throughout the nation.

 

The answer is enforcement of existing laws, not new legislation that will make it illegal for reputable attorneys to charge reasonable fees to clients who wish to engage their services.  Because homeowners need help.

IF YOU’RE WILLING TO  STAND UP AND BE COUNTED,

PLEASE EMAIL ME RIGHT AWAY AT:

MANDELMAN@MAC.COM

 

And please forward a link to this article to everyone you know.

This threat is very, very real.

California DRE

California DRE Updates Desist & Refrain List Against Mod Companies

You can see it here:

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

California DRE

Would You Hire This Guy to do Your Loan Mod?

Since I started this site at the end of January, people in the media have been asking me what inspired me to create MFI-Mod Squad.  I’ve been telling them that it was an offshoot of MFI-Miami. I’ve kept quiet about the person who served as the inspiration. Quite honestly, I don’t have time for this person’s immature threats and Wagnerian theatrics.

That’s right. Maurice Clement Bedard, aka Moe Bedard , of Loan Safe Solutions was the inspiration for MFI-Mod Squad. Why is Moe the inspiration?  Well, back in August, it was discovered that Moe had a dirty little secret he wasn’t sharing with the public. This secret contradicted his image as the champion of the little guy. This secret became known within the modification and lending industry but has not been widely circulated to the general public or to the mainstream media. Those he couldn’t bully just didn’t want the headache of dealing with him.

According to the California Superior Court in Orange County, on December 20, 1995, Moe was arrested and charged with marijuana possession and sale or transport of marijuana. He pled guilty to both charges on March 14, 1996.

As if Moe didn’t learn his lesson the first time, on 1/2/2003, the California Superior Court in Riverside County found him guilty of “felony possession of marijuana for sale.” The companion charges of cultivating marijuana and abuse and endangerment of a child were dismissed by the court.  Six weeks later, in Riverside County Superior Court, Moe was found guilty of “battery on spouse/cohabitant.”

Apparently, Moe didn’t get the hint that beating women was not acceptable behavior in our society. Six months later, on August 26, 2004, Moe was found guilty of “corporal injury on spouse/cohabitant.” This was a felony. The companion charge of assault with a deadly weapon was dismissed.

On November 23, 2004, Moe was sentenced to two years in prison (less 66 days time served) and was transported to the California Rehabilitation Center in Norco, CA.

While at Norco, Moe’s DRE license (#1237996) was permanently revoked for, as the DRE put it, “moral turpitude.” What is moral turpitude? It is conduct that’s considered contrary to community standards of justice, honesty, or good morals.

When Moe was released from prison, he didn’t let small problems like felony convictions and lack of a DRE license stop him from getting back into the mortgage business. Being a crafty felon, he used his Internet skills to begin developing the concept for Loan Safe Solutions.

By the spring of 2007, the mortgage industry was heading into a tail spin, and Moe pitched the idea of Loan Safe Solutions to his former boss, Tony Salaszar, at Consumer Direct Lending. Both of them reached a private agreement.

In order to give the new company some credibility, they used one of Tony Salaszar’s dormant companies —Empire Marketing— and changed the name to Loan Safe Solutions. This was done in case anyone checked with the state of California and as a safeguard against Moe’s criminal past ever becoming an issue with DRE. Loan Safe Solutions would rent the space and equipment in the building that was already owned by Tony Salaszar. In return, Moe would own a majority share of Loan Safe Solutions off the books.

Loan Safe Solutions began Loansafe.org as a marketing tool for the new company. Although Moe advertised it as a “not-for-profit,” it was hardly a charity. It sold advertising space exclusively to  a “selected” attorney to whom Loan Safe would then refer all their clients.

Loan Safe Solutions didn’t solicit clients for themselves or the law firms. Clients came to the company via the Internet. So, the company was able to sidestep the California Business and Professions Code, which prohibits non-law firms from soliciting for law firms. However, Moe Bedard and Tony Salaszar may have broken the law. How? Well, a piece of every retainer fee collected by the advertising law firm from leads from the Loansafe.org site was paid to Loan Safe Solutions.

To further isolate himself from any liability, Moe began what was known as the “affiliate” program.  An affiliate was a third party who collected the upfront fees for the law firm and Loan Safe Solutions. The consumer would pay the affiliate $4000, and the affiliate would then pay Loan Safe Solutions between $2500 and $3000 in processing fees. The amount that was paid was determined by the agreement between the affiliate and Loan Safe Solutions. This put all the liability on the third-party salesman if Moe or the attorney failed to get the client a loan modification.

In the summer of 2008, two things happened that ended this practice. First, word began circulating in the mortgage industry about Moe’s felony convictions. Secondly, the California DRE began regulating loan modifications and who could provide them. DRE began requiring that modification companies be licensed under DRE. The DRE also required modification companies to obtain special approval to charge upfront fees.

Being a crafty little devil, Moe devised a scheme. In the scheme, he changed his client agreements to be legal retainer agreements for his selected attorney and gave the attorney a 150-square foot office within the 6000-square foot Loan Safe Solutions suite. Both Loan Safe Solutions and the attorney would share staff and equipment.   The attorney would then pay Loan Safe a marketing fee, a monthly fee, and a per-file processing fee.   All the sales people worked on contract with the law firm. The phones were even answered by Loan Safe Solutions staffers.

However, when Moe would fire the selected attorneyor the attorney voluntarily terminated the relationship, the staff would stay for the next firm. It was commonly known that Moe was calling the shots and that the attorneys were just figureheads. Loan Safe Solutions became a revolving door of attorneys. Within the past year, the company has had four firms come and go, yet the attorneys’ employees all stayed in the office.

According to my source, the attorneys were only involved in 30-50% of the cases that came into Loan Safe Solutions, although all the clients signed retainer agreements. The only time that the attorney ever spoke to a client was after Loan Safe Solutions negotiated a loan modification with a lender and sent out letters on the attorney’s letterhead.

Attorneys would get complaints from clients and from the State Bar of California.  However, after questioning Moe, Moe would fire the attorneys. He knew that if the attorneys went to the state of California, they would have to implicate themselves in order rat him out. Due to Moe’s erratic and abusive behavior, the attorneys left quietly. They weren’t willing to ruin their legal practices.

In January 2009, Moe fired the CEO of Loan Safe Solutions, his friend, Tony Salaszar. Tony is the same guy who gave Moe a second chance after Moe got out of prison. Moe was supposed to pay Tony a sepearation package.  However, Moe stopped paying Tony in March.

Apparently, Tony Salaszar wasn’t the only person Moe wasn’t paying.  On May 4th, Moe found the Loan Safe Solutions office locked with an eviction notice on the door.  The new property owner wasn’t going to be as lenient as Tony Salaszar.  Unfortunately, this is not good news for the 500+ paid clients whose files were locked inside the office.  Their modifications more than likely will never get done and the clients are out thousands of dollars.

During the first week of April 2009, Moe announced to his employees that he was selling Loan Safe Solutions.  There was a problem with this announcement. It’s unlikely that anyone would want to buy an illegally run loan modification company. There also may be a lawsuit pending against Loan Safe Solutions for copyright infringement.

At the end of 2008, First American Title filed a cease and desist  for a copyright infringement against Loan Safe Solutions. First American has a division called Corelogic, which has a product on the market called Loansafe 2.0.  Apparently, Moe didn’t bother to check with the U.S. Patent Office before he started using the name.

Knowing the end was near with Loan Safe Solutions, Moe started a new business called Moeseo. Once again, he uses the skills he learned with the help of liberal taxpayers from California. This time, he has created a website and a set of Internet marketing tools for law firms that want to perform loan modifications.

Moe brags that the site, Modifyloan.net, was created for a specific law firm in February of 2009 and has had nearly 5,300 visitors in 11 days. However, Moe stretched the truth on this one. Modifyloan.net is not a dedicated website for that specific law firm, and it isn’t a new website. The domain name, Modifyloan.net, is owned by MHloan Pro, which is owned by Moe Bedard. Modifyloan.net was an active domain name and website 12 months prior and was in daily use as late as April 2008.

What will Moe do after reading this? Oh, he’ll threaten to sue me. He’ll create bogus WordPress blogs about me, try to spread lies about me on the Internet, tell people I’m slandering his good name and have the Internet version of a temper tantrum. He’s done it all before.

California DRE

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.

California DRE

Mod Companies in CA Who Collect Upfront Fees Must Be On This List!