California says law firms scammed homeowners
Lawyers and companies who collected fees from homeowners as part of 'mass joinder' suits against big lenders are shut down and accused of making false promises.
California's attorney general has sued four lawyers, three law firms and others, saying they collected millions of dollars from homeowners in at least 17 states by falsely claiming to help them avoid foreclosure.
The action was the first by California's Mortgage Fraud Strike Force. The assets of those named in the suits were seized by either the California Department of Justice or the California Bar.
"The defendants in this case fraudulently promised to win prompt mortgage relief for millions of vulnerable homeowners across the country," Attorney General Kamala Harris said in a news release. "Innocent people, already battered by the housing crisis, were targeted for fraud in their moment of distress."
According to the California attorney general's office, the lawyers and others representing them – in some cases, paid salespeople -- sent more than 2 million advertisements to borrowers in at least 17 states, asking homeowners to join their lawsuits against the big banks. In exchange, the solicitations claimed, the homeowners would avoid foreclosure and perhaps even have their mortgages thrown out and be able to keep their homes.
That was not the case, however. Some homeowners lost their homes shortly after joining the suits, the California attorney general said.
Normally, in a class-action suit, the law firms bring the suits at their own expense. If they win, they take their fee off the top and the rest of the money is divided among the plaintiffs and others in a similar position.
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In this case, however, the lawyers solicited fees from homeowners ranging from $3,500 to $10,000, but did nothing to help those homeowners, California officials said.
The California Bar seized the assets of the Law Offices of Kramer & Kaslow; Philip Kramer; Mitchell J. Stein & Associates; Mitchell Stein; Christopher Van Son; Mesa Law Group Corp.; and Paul Petersen.
The state seized the assets of Attorneys Processing Center; Data Management; Gary DiGirolamo; Bill Stephenson; Mitigation Professionals Glen Reneau; Pate Marier & Associates; James Pate; Ryan Marier; Home Retention Division; Michael Tapia; Lewis Marketing Corp.; Clarence Butt; and Thomas Phanco.
The "mass joinder" lawsuits brought by these law firms – and the way they are "marketed" to consumers -- have long been controversial. Krista Railey at LoanSafe.org has some details. She writes:
The marketing of the lawsuits, typically handled by nonattorney “intake ambassadors,” preyed on desperate borrowers' hopes via high-pressure sales tactics and lofty promises regarding potential case outcomes. … The nonattorney ambassadors were paid high commissions, and were often allowed to charge as much as they wished to prospective clients and pocket the difference. The average fee to join the suits ranged between $3,500 to $7,000, but could be as high as tens of thousands of dollars.
"Mortgage rescue frauds are extremely good at selling false hope to consumers in trouble with regard to home loans," the real-estate department wrote. "The scammers continue to adapt and to modify their schemes as soon as their last ones became ineffective. Promises of successes through mass joinder or class litigation are now being marketed."
I guess the law firm of DUEY, CHEATHAM, and HOWE, will now have to move to a state with a more republican LESS REGULATION philosophy, say Texas or Arizona
The fact is that no one in their right mind trusts the government/public officials to hold each other accountable and the powder keg is about to blow.
What the government and their propaganda media machines are really getting queasy about is that more and more citizens are starting to think that killing attorneys, public officials en masse, and burning down newspapers may not be such a bad idea anymore. Not that I would do so...but I will also say that I will not do anything to stop those that decided to do so.
I only pray that my family is not killed accidentally.
Is there any mention of a group called Certified Financial Protection Group or Financial hope for america they took a lot of peoples money also they started out as Certified Financial group and when they got into trouble changed their name to Financial hope for America the same two people ran the company there is a site called ripoffreport wit the dot com they have info on a bunch of firms that TOOK peoples money with promises that weren't kept. are they listed anywhere in this law suit?
Anyone who tries to make this into a political discussion by blaming one party or the other only shows themselves as nothing more than a political crony. This is simply a story about crooked lawyers (I know a little redundant) scamming people who are in need of help. Something that happens every day in every state.
As for the political comments, as long as we citizens continue to buy into the politicians baiting us and vilifying the "other side" of the aisle, claiming they want to destroy this country, we will not be able to come together and fix our problems. Stop buying into the "us vs. them" mentality. Regardless of what "birthers" believe, we are all Americans and should treat each other with respect, even if we don't agree. And besides, how do you know you are right if you aren't even willing to openly listen to someone else's point of view?
(For all of you honest lawyers, sorry I couldn't resist. I know there are plenty of you. Unfortunately, there seems to be a lower percentage of honest lawyers than honest professionals in other fields. And when you consider that most politicians on both sides of the aisle are lawyers, well, then you can really understand why the general public has issues with lawyers in general.)
This has been going on since waaaaaay before Obama and the current administration, people. And the deceit runs on both sides of the fence, not just the Executive branch.
Oh, and what do you call 1,000 lawyers at the bottom of the ocean? A good start.
What's the difference between a dead skunk in the road and a dead lawyer in the road? Brake marks in front of the skunk.
Joe, I'm sorry to hear they got money from you. I hope you can get it back.
I say great for the CA AG. Most lawyers are honest, hard-working people who make a DECENT living, not the type of slithering sleaze that these types are. Most lawyers coming out of school now make only $30-60K per year, a decent living until you consider they have seven years of higher education and Tens and sometimes Hundreds of thousands of dollars of educational debt. Those are the ones who are fortunate enough to FIND a job in this oversaturated field. A small percentage of lawyers six figures (or more) and of those, a smaller percentage are the thieves and sharks that are the cause of the lawyer jokes.
Yay for the CA Attorney General for coming down on these individuals and firms and I hope that if they're guilty, they're fined the ENTIRE amount they scammed the homeowners, their houses and personal possessions are foreclosed upon and they lose their licenses to practice law in every state and not just CA.
(Oh, and for the guy asking about why they, and entertainers and sports figures make so much money the answers are: most of them don't and those that do get paid the big bucks are paid because someone is *willing* to pay them that much. We all still buy our movie tickets and pay to watch the games, don't we?)
*Not a lawyer and don't play one on TV.
Question-what do you have with a room full of lawyers up to their noses in water?
Answer-not enough water
What gives anyone the right, from actors to sports figures to lawyers to charge outrageous amounts of money for their so-called expertise? Why don't firefighters, EMTs, soldiers and cops make that kind of money? They are far more deserving of it then these spoiled rotten actors and actresses who throw away their millions on drugs and partying!
Well, I guess as long as people are willing to pay good money to see them or to hire an over-priced attorney that's the way it will always be.. Me, I don't go to movies anymore, I wait until they come on TV and I sure as hell can't afford any lawyer..
I wonder if the greed will ever stop and people will do their job to honestly help people in need and not just for the almighty buck?
Sadly it is crap like this that cause lawyers to be looked on as s****ing bottom feeders just like the joke says, only it's reallity. Maybe some real lawyers will come out and beat these jokers down with lawsuits.
I have trouble calling them lawyers when they only try to scam people with this kind of thing.
About Teresa Mears
Teresa Mears is a veteran journalist who has been interested in houses since her father took her to tax auctions to carry the cash at age 10. A former editor of The Miami Herald's Home & Design section, she lives in South Florida where, in addition to writing about real estate, she publishes Miami on the Cheap to help her neighbors adjust to the loss of 60% of their property value.