Colorado AG Targets Foreclosure Rescue Outfit With Lawsuit Alleging Illegal Upfront Fee Loan Modification Racket

From the Office of the Colorado Attorney General:

• Colorado Attorney General John Suthers announced today that his office has filed a consumer protection lawsuit against American Mortgage Consultants ["AMC"], its owner, Oliver Paul Maldonado, and its principal employee, Santiago Fabian Pineda, on suspicion that they defrauded consumers seeking loan modifications and foreclosure relief.

• According to the complaint, filed in Denver District Court, American Mortgage Consultants used deceptive advertisements to attract approximately 170 consumers to the loan modification company from January 2009 through March 2010.(1) [...] Maldonado and American Mortgage Consultants are suspected of charging these consumers $2,500 in upfront fees for its services, which is illegal under Colorado law. According to the complaint, American Mortgage Consultants did little if anything to help its customers renegotiate or modify their home loans beyond shipping off their loan modification applications to an Ohio-based company.

For the Colorado AG press release, see Attorney General announces consumer-protection lawsuit against Colorado loan modification company.

For other documents on this case from the Colorado AG:

• AMC Maldonado lawsuit,
• AMC Maldonado motion for Temporary Restraining Order and Preliminary Injunction,
• AMC Maldonado Temporary Restraining Order.

(1) According to the press release, the company and Maldonado are suspected of using deceptive telephone marketing, direct mail, radio advertisements and Web marketing to attract consumers. According to the complaint, Maldonado also used video of President Barack Obama and materials from the Federal Deposit Insurance Corporation to give consumers the impression that American Mortgage Consultants was affiliated with or partnering with the federal government.