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Florida Attorney General Files Lawsuit To Stop Foreclosure Defense Scam

Florida Attorney General Pam Bondi recently announced that her office would be taking on fake foreclosure defense and loan modification firms operating throughout the state. The Attorney General filed a complaint on August 17 naming six individuals and 14 interrelated companies as part of the scheme.

The companies targeted distressed homeowners who were having difficulties paying their mortgage and may have been facing foreclosure. The firms would charge homeowners thousands of dollars in fees for “legal services,” which had various degrees of efficacy. Most of the time, these companies would pursue loan modifications using the same methods that were free to the homeowners.

The companies were run by attorneys who responded to ads on Craigslist. These attorneys were often young, inexperienced, or desperate for work in a struggling economy. The attorneys who responded to the ads did not end up working on client matters at all; instead, the defendants stole the attorneys’ names and bar license numbers and used this information on the companies’ retainer agreements, letterhead, legal pleadings, and corporate filings. The complaint alleges that, “The enterprise then goes so far as to electronically sign and file boilerplate pleadings under that attorney’s name without the attorney ever knowing the clients exist.”

The Attorney General alleges in the complaint that the companies violated Florida’s Deceptive and Unfair Trade Practices Act by promising homeowners elite legal services and providing little to no real help. The defendants collected up-front and monthly payments from the homeowners, but failed to protect their homes from foreclosure or obtain the promised loan modifications. Instead, the defendants simply sent meaningless paperwork to the homeowners and filed boilerplate pleadings in court without attorney approval.

The two men charged with leading the illegal enterprise were arrested shortly before the complaint was filed and charged with a felony for practicing law without a license. The Attorney General’s office is seeking an injunction barring the men from engaging in any similar businesses in the future, and ask for full restitution for the victims.

Foreclosure rescue scams like these have been plaguing Florida for years. When a person promises to help save your home from foreclosure by pursing a loan modification on your behalf, it is important to remember that these same services are FREE to struggling homeowners. If a person or company says that they can help you in exchange for an upfront payment, a large monthly payment, or makes promises that are too good to be true, run away fast. Up-front payments for loan modification or foreclosure defense services are illegal in the state of Florida, no matter what they are called.

Legitimate loan modification and foreclosure services exist. At Loan Lawyers, our attorneys offer these services in addition to our regular legal practice. We help clients save their homes using whatever tactic is best, including loan modifications, foreclosure defense, and bankruptcy.  To schedule a free consultation and learn more about how our attorneys can help you, contact us today by calling (888) FIGHT-13 (344-4813).