BBB Says Steer Clear Of Nat'l 'Mass Joinder' Lawsuit Invites; Some Claim Offers Merely A Bogus End-Run Around Loan Mod Upfront Fee Prohibitions

From a press release from the Better Business Bureau:

• The Better Business Bureau (BBB) warns homeowners to steer clear of mailings asking them to join national “mass joinder” lawsuits to force their mortgage companies to cut their loan payments. Michelle Corey, BBB president and CEO, says the mailings are a new twist on schemes to obtain up-front payments of $5,000 or more from homeowners struggling to pay their mortgages.

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• Several property owners in Boone County, Mo., recently got letters saying that their loans “may be eligible for national litigation aimed at fraudulent lender actions.” The letters listed no company name or return address. A nearly identical notice sent to a homeowner in Long Beach, Calif., came from the Litigation Settlement Department at 3829 Veterans Memorial Parkway, St. Peters, Mo.
• Missouri secretary of state records list the St. Peters address as home to Diversified Financial Protection Agency and Capital Debt Management. The records list John Jacob Ehlinger as president of Capital Debt Management. John J. Ehlinger is registered agent and the only incorporator of Diversified Financial Protection Agency. Capital Debt Management filed for incorporation in October 2009; Diversified Financial Protection Agency filed on Feb. 16, 2011.
• The BBB has issued two warnings on Ehlinger and Capital Debt Management since last summer. The company has an “F” grade with the BBB, the lowest grade possible.

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• Officials of Diversified Financial Protection Agency, Capital Debt Management, or both firms, apparently are now partnering with Mass Litigation Alliance of Hawthorne, Calif. The same toll-free phone number is on the Boone County and California solicitations and is one of several listed on a website for Mass Litigation Alliance.
• Mass Litigation Alliance filed corporate papers with the California secretary of state on Feb. 14, listing Philip A. Kramer of Calabasas, Calif., as the company’s agent.Mass Litigation Alliance’s website describes Kramer as senior partner of Kramer & Kaslow, a Calabasas law firm with an “F” grade from the Los Angeles BBB.
• Consumers have filed more than 30 complaints about the firm. Most allege the firm didn’t fulfill contracts for loan modification or foreclosure related services, that the firm misrepresented its ability to provide service, or that the complainant was unable to obtain refunds of advance fees.
• The company has disputed the allegations and said contracts are based on hourly rates or flat fees, not on performance.

For the press release, see BBB Warns Homeowners: 'Mass Joinder' Lawsuit Mailings May Be Latest Advance Fee Mortgage Modification Scheme.

See also, State Bar Investigator: "Now We're Seeing The Loan Mod People Morph Into The Sue-Your-Bank People" As Scammers Circumvent Upfont Fee Prohibitions.