FTC Wins $2.6 Million Judgment Against Scamming Loan Mod Firm
National Mortgage Professional
July 2, 2012
The Federal Trade Commission (FTC) won a $2.6 million judgment against three defendants involved in a scam that charged large upfront fees for loan modifications but failed to deliver promised results. The three are banned for 10 years from telemarketing financial products or services; selling products or services related to mortgage workouts, foreclosure rescue, or debt relief; and attempting to collect from consumers who had agreed to purchase a mortgage-assistance product or service. The ruling involved the U.S. District Court for the Middle District of Florida, Tampa Division, which also approved settlements with five more defendants in the case and entered a default judgment against another. The FTC had filed a complaint against the nine defendants behind the Crowder Law Group as part of an ongoing effort to shield homeowners from mortgage-related scams. All defendants were charged with violating the Federal Trade Commission Act and the Telemarketing Sales Rule. In the fake operation, a marketing company contracted with a direct-mail firm to send postcards to U.S. homeowners whose mortgage payments were at least two months behind. When homeowners called the toll-free phone number on the materials in hopes of getting financial relief, a customer service representative collected the consumer's financial documents and a $2,000 fee. Although assured that they had qualified for a loan workout, borrowers actually still had to go through the modification process -- often unsuccessfully.
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