California goes after dozens of loan modification scam companies
The state has just recently gone after some 21 loan modification companies for various charges, all comes down to “possible scam companies”.
“The loan modification industry is teeming with confidence men and charlatans, who rip off desperate homeowners facing foreclosure,” Brown said in a release. “Despite firm promises and money-back guarantees, these scam artists pocketed thousands of dollars from each victim and didn’t provide an ounce of relief.”
“The loan modification industry is teeming with confidence men and charlatans who rip off desperate homeowners facing foreclosure,” he said. “Despite firm promises and money-back guarantees, these scam artists pocketed thousands of dollars from each victim and didn’t provide an ounce of relief.”
Brown’s lawsuit contends that the defendants violated a few laws including:
- California Business and Professions Code section 17500 by claiming a 95 percent success rate and promising consumers significant reductions in the principal balance of their mortgages;
- California Business and Professions Code section 17200 by failing to perform on promises made in exchange for upfront fees;
- California Civil Code section 2945.4 for unlawfully collecting upfront fees for loan modification services;
- California Business and Professions Code section 2945.3 by failing to include cancellation notices in their contracts;
- California Civil Code section 2945.45 by not registering with the Attorney General’s office as foreclosure consultants; and
- California Penal Code section 487 for grand theft.
- Violated California’s credit counseling and foreclosure consultant laws, Civil Code sections 1789 and 2945
- Inserted unconscionable terms in contracts;
- Engaged in improper running and capping, meaning that Roth improperly partnered with United First, Inc. and Noe, who were not lawyers, to generate business for his law firm violating California Business and Professions Code 6150; and
- Violated 17500 of the California Business and Professions Code.
source: press release
