forensic auditing

Apply 2 Save Shuts Down

You may remember Apply 2 Save, Inc.  from my 20 Worst Modification List back in March.  

The IRS and the state of Idaho put the final nails in their coffin last week.   The IRS filed four tax liens for over $663,000 for unpaid 2008 federal unemployment and income taxes.  The state of Idaho filed a $52,000 lien for upaid withholding tax.

Idaho Attorney General Lawrence Wasden, who had already filed a consumer protection complaint against Apply 2 Save and it’s president, Derek Oberholtzer last month amended his complaint claiming the company preyed on desperate homeowners.  By Thursday of last week, Apply 2 Save’s website and telephones were shut down.  In another move that is predictable by companies like this, the final paychecks for their employees all bounced.

forensic auditing

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.