Watch Out For Local Notaries Providing Document-Running, Check Pick-Up Services For Out-Of-State Loan Modification Rackets

A recent lawsuit filed by the Office of the Wisconsin Attorney General decribes how some out-of-state loan modification rackets allegedly use local notaries to get homeowners to sign up for foreclosure help and pocket upfront fees:

• Defendant [loan modification outfit] initiates transactions with Wisconsin consumers by telephone. It represents it can assist the consumers to modify their mortgage loan. Defendant then arranges a follow-up visit by a company representative to complete the transaction. Defendant's "company representatives" are Wisconsin notaries hired by defendant to act as its agents. Since April 2009, at least four Wisconsin notaries have filed complaints with DATCP [Wisconsin Department of Agriculture, Trade, and Consumer Protection] regarding defendant's activities.

• The notaries report receiving email solicitations from defendant where defendant offers to pay them to act as its representative by obtaining signatures from potential customers on sales agreements prepared by the defendant. The notaries also report defendant instructs them to engage in illegal activity including, but not limited to, having customers fill out only a portion of the legal documents they sign and having the notaries fail to provide copies of signed documents with the customers.

• For example, on March 9, 2009, defendant sent Wisconsin notary Dick Brockman an email "LOAN MODIFICATION PAPERWORK - LEE." [...] In the email, defendant instructs Mr. Brockman: "Remember to have the borrowers just sign and date and only fill out their name, address, phone numbers, social security numbers and mortgage info. The rest of the application is filled out later by the processor...." Defendant further instructs the notary [...]: "DO NOT leave the "Loan Modification Application" with the client. ONLY GIVE the client the *Modification Letter & News Releases*." The news releases referred to [...] are copies of news articles regarding federal mortgage relief programs "Bush Signs Measures for Homeowners, Fannie, Freddie" and "Obama throws $75 billion lifeline to homeowners."

Source: Lawsuit: State of Wisconsin v. 21st Century Legal Services Inc., et al. (paragraphs 9-16).

In a related post on 21st Century Legal Services and their use of local notaries, see Loan Modification Outfit Accused Of Failing To Deliver Services For Strapped Homeowners Also Stiffs Its Notaries, Says One Victim.