Thursday, January 24, 2008

Florida AG Sues 19 Foreclosure Rescuers

National Foreclosure Management, Inc., American Home Rescue, Inc., National Property Holding Group, LLC,, The Mortgage Practice, Inc., Southeast Capital Mortgage Company, Barrister Title Services, Inc., GMC Land Services of Florida, Inc., doing business as Richmond Abstract, Inc., Bernard Williams, Wyman F. Roberts, Lakeisha Marion, Anna Silva, Albert Nae, Linda Rubinchik, Rhona Oliver, Tracy Needleman, Gina Rock, John Sarlo, Dianna Brown-Flournoy, and Reina Roman have all been named defendants in a suit by Attorney General Bill McCollum.

Beginning in October 2004, National Foreclosure Management – which now does business as American Home Rescue, Inc. – selected homeowners who had substantial equity in their homes but were in the process of being foreclosed upon. The company would offer to hold the titles to the homes for a year, refinance the debt, and provide cash and credit repair counseling to the homeowner, all while allowing the homeowner to remain in the house. The company claimed it would deed the property back at the end of the year after the foreclosure had been avoided and the homeowner’s credit was repaired.

Once the company had obtained the title to the house, the Attorney General’s lawsuit alleges the company would strip the equity from the homes by refinancing them at inflated prices and by assessing fraudulent fees and costs, leaving little or nothing for the homeowner to recoup. The home would then be sold outright to an investor or a straw buyer who would lease the home back to the homeowner at a rental rate far exceeding the original mortgage payment, virtually ensuring the homeowner’s eventual eviction. According to the lawsuit, the homeowners would end up with neither the titles to the homes nor the equity that rightfully belonged to them.

The complaint, filed with the Office of Financial Regulation, seeks restitution to the affected homeowners, dissolution of the rescue foreclosure companies, and revocation of the mortgage brokers’ licenses revoked. Don Saxon, Commissioner of the Office of Financial Regulation, expressed gratitude to Attorney General Bill McCollum and Chief Financial Officer Alex Sink for their continued support and commitment to protect consumers.

“Mortgage fraud is a destructive crime that can destroy a family’s future in an instant, and we need stronger laws to protect Florida’s consumers,” said Chief Financial Officer Sink, who oversees the Department of Financial Services and who heralded today’s actions as essential to the fight against mortgage-related fraud. “It is downright disgraceful that some would use trickery to steal the dream of homeownership from a struggling Floridian.”

The lawsuit is the first filed by the Attorney General’s Mortgage Fraud Task Force, created to investigate these various schemes and, where appropriate, seek solutions to protect consumers. The task force has been in operation since September and is comprised of 25 lawyers and investigators in the Attorney General’s Office, stationed in locations throughout the state.

In addition to the lawsuit, McCollum announced a multi-pronged initiative to combat mortgage-related fraud, specifically fraud involving “rescue foreclosure” scams. As part of the litigation and legislation-based initiative, the Attorney General filed the lawsuit asserting that the South Florida-based National Foreclosure Management and multiple affiliates defrauded at least 80 homeowners out of approximately $1.7 million in home equity. These allegations were investigated by a new task force developed by Attorney General McCollum to target mortgage-related fraud, an effort bolstered by proposed legislation to strengthen provisions against mortgage rescue scams.

“The Attorney General’s Office is taking action against unscrupulous individuals who attempt to take advantage of our citizens when they are desperate to protect their homes,” said Attorney General McCollum. “We are tackling this growing problem from several directions to help keep families in the homes they’ve worked so hard to achieve.”

In addition to filing the lawsuit, the Attorney General announced the filing of the “Foreclosure Rescue Fraud Prevention Act,”. The proposed legislation will ensure that, among other things, homeowners are properly informed about their rights when they are signing a contract with a foreclosure rescue entity.

“When people are on the brink of losing their homes, they are desperate for any assistance available and all too often they trust a wolf in sheep’s clothing,” said Senator Fasano. “We must strive to protect Florida’s homeowners from such a dangerous situation.”

“This legislation is designed to protect homeowners from individuals who attempt to prey upon them in their time of distress,” said Representative Ford. “We must make every effort to shelter our citizens from this blatant form of deception.”

The proposed legislation offers the following key provisions:

-- A five-day right of cancellation period that allows the consumer to cancel the agreement with the foreclosure rescuer;

-- Requirements that foreclosure rescuers include in the contract clear and conspicuous notice to homeowners of this right of cancellation as well as a recommendation that the homeowner contact the lender or mortgage servicer prior to the signing of the agreement and a provision that states the consultant is prohibited from accepting any form of payment until all services are completed;

-- Definitions of such terms as “Equity Purchaser,” “Foreclosure Consultant,” “Foreclosure-related Services,” and “Foreclosure Rescue Transaction”; and

-- That all violations of this act are defined as an unfair and deceptive trade practices and are subject to the penalties included in Part II of Chapter 501, Florida Statutes.

The legislation is filed under Senate Bill 992 and House Bill 643.

mortgage fraud

1. GMC Land Services of Florida, Inc., doing business as Richmond Abstract, Inc., is/was owned by Joe Laforte, he is the same person named on an article by the title of “Civil Lawsuits Precede New York Money Laundering Charges” posted on this site on Friday, November 04, 2005. When is he and everyone else involved in this scam going to do time?

   If the AG can’t find info on them maybe they should turn to the electronic storage companies that people in this industry use to store their files. I don’t know what took the AG so long to file this law suit, Richmond was shut down by the Feds back in 2005 and the owners walked away to the next title company down the road.

   Posted by  on  01/25  at  12:14 PM