Houston Firms Charged with Conducting Fraudulent Foreclosure Rescue Scam

admin —  May 18, 2009 — 1 Comment

Excel Loss Mitigation Inc., United Servicing LLC, Bell Investments & Developments LLC and key directors Frank Bell, David Bell and David Espy have been charged with running foreclosure “rescue” scams.

According to the state’s enforcement action, the defendants fraudulently charged their customers for worthless “rescue,” debt counseling and credit repair services. The telemarketers – using a script authored by the defendants – promised homeowners that the defendants could negotiate late fees, past due amounts and interest with lenders. The renegotiation, the defendants claimed, would allow customers to avoid foreclosure and even reduce monthly payments.

All of the defendants were also charged with failing to post a bond with the Texas Secretary of State, which is required to legally conduct business in the state of Texas. District Judge Patricia J. Kerrigan also granted the Attorney General’s request for a temporary restraining order.

Excel, which was renamed United Servicing after an influx of customer complaints, proactively contacted hundreds of homeowners who were struggling to pay their mortgages. State investigators discovered that the companies employed telemarketers who falsely promised that their services would allow homeowners to avoid foreclosure.

Homeowners should immediately contact their mortgage lenders when they fall behind on their payments. However, the defendants’ telemarketers instructed homeowners not to contact lenders throughout the duration of the “rescue” operation. They also told homeowners they would be able to skip two or three months of mortgage payments. Customers were charged $1,500 for the 45- to 60-day “negotiation” service promised by the defendant.

According to investigators, the defendants made no efforts to negotiate with lenders on customers’ behalf. Client files were in a state of disarray and not stored in a manner that was conducive to a functional enterprise. Many of the defendants’ customers eventually lost their homes to foreclosure or were forced to seek additional services from legitimate operators.

The case was brought by Texas Attorney General Greg Abbott. The Office of the AG is seeking civil penalties of up to $20,000 for each violation of the Texas Deceptive Trade Practices Act, as well as restitution for harmed customers. In addition, the Attorney General seeks penalties for numerous violations of the Texas Telephone Solicitation Act and the state’s Finance Code.

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One response to Houston Firms Charged with Conducting Fraudulent Foreclosure Rescue Scam

  1. my wife and I were sent money to a company called Excel loss mitigation we were having problens with our mortgage company and were promised that this company would help us if we would send them money, we did 1500.00 deollars and never heard from them since the Texas Attorney General and judges has frozen all asets belonging to this company. I just and lost as to how we can recoup some or all our money back.

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