Strong Arm Homeowner Association Collection Tactics Suspected

AHRC News Services has issued a March 21, 2007 Press Release from the California law firm Gottschalk & Associates that reports:

• The Law Offices of Gottschalk & Associates announced today that it is launching a RICO investigation of attorneys and management companies for homeowners associations in California.

The issue involved appears to be the alleged, excessive padding of legal and collection fees (and other costs of rules enforcement) by the management companies and homeowner association-hired attorneys when they attempt to (a) collect association maintenance fees from those unit owners who have fallen behind on their payments, and (b) otherwise enforce the association rules and regulations. In effect, it appears that the association-hired attorneys and management companies are being accused of using the threat of the possible loss of the equity in a property owner's home as leverage against the homeowner in collecting excessive fees and charges.

(A similar tactic is used by predatory mortgage servicing companies in attempting to improperly squeeze money out of a homeowner - click here for posts on predatory mortgage servicing).

Reportedly, there is an existing complaint in the Orange County, California Superior Court under the RICO Act (Racketeer Influenced and Corrupt Organizations Act) and other claims that is set for trial in July 2007 against the law firm of Swedelson & Gottlieb, David Swedelson and Sandra Gottlieb individually, Association Lien Services and others.

The Press Release further requests that:

• Homeowners who currently live or formerly lived in homeowners' associations that have information of potential claims against Swedelson & Gottlieb and Peters & Freedman are requested to forward debt collection letters, bills for excessive fees not due and copies of their complaints and lawsuits and to advise whether you wish to be considered as a Plaintiff Class Representative in a class action. Homeowners who already are represented by an attorney are requested to have their attorneys contact Gottschalk and Associates with the information.

To read more, see the March 21 AHRC Press Release.

For another report on foreclosure lawsuits filed by homeowners associations and their attorneys, see the Houston Chronicle, A growing housing trend (Foreclosure suits filed by homeowners groups add up)

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Note:.

The American Homeowners Resource Center ("AHRC") is described in their website as a public interest interactive website for homeowners who live in homeowners associations which is intended to help these homeowners protect themselves from, what in effect is, the abusive, overreaching, and egregious conduct engaged in by some of those who run the associations (ie. the association directors and officers), and the management companies, attorneys and others who are hired by them.