Sunday, August 09, 2015

Bay State AG Scores Win In Obtaining $625K+ Judgment Against Attorney Who Pocketed Illegal Upfront Fees Peddling Bogus Loan Modifications To Spanish, Portuguese-Speaking Homeowners

From the Office of the Massachusetts Attorney General:
  • A Revere attorney and his two businesses have been ordered to pay more than $625,000 for targeting homeowners with deceptive advertisements and demanding thousands in illegal advance fees for mortgage modification and foreclosure relief services they failed to deliver, Attorney General Maura Healey announced [].

    ***

    The final judgment, issued by Suffolk Superior Court Judge Paul Wilson against David Zak and his businesses Zak Law Offices, P.C., and Loan Modification Group, Inc., finds defendants liable under the state’s Consumer Protection Act. The court found that the defendants preyed upon at-risk homeowners throughout Massachusetts who were facing the imminent loss of their homes, took unlawful advance fees based on deceptive guarantees that mortgage loans could be modified to prevent foreclosures.

    The judgment requires the defendants to pay more than $625,000, including $400,000 in civil penalties, more than $68,000 in attorney’s fees and costs, and $157,000 in consumer restitution for approximately 65 former clients(1) who complained to the AG’s Office about the deceptive practices and unlawful advance fees.

    As found by the Superior Court, the defendants targeted Spanish and Portuguese-speaking homeowners with misleading radio advertisements guaranteeing dramatic loan modifications and legal representation to avoid foreclosure. The defendants failed to disclose in the advertisements that there was no guarantee of success, when in fact they had failed to obtain the promised modifications for most of their clients.

    On the basis of these false promises, and in violation of Massachusetts law, the defendants demanded non-refundable advance fees of $5,000 or more from distressed homeowners – when foreclosure relief services were available for free elsewhere – only to fail to deliver on their promises, leaving homeowners even more at risk of foreclosure.

    Under the terms of the judgment, Zak and his companies are enjoined from engaging in deceptive advertising or soliciting, arranging or accepting advance fees for mortgage assistance or foreclosure-relief services.
Source: Revere Attorney Ordered to Pay More Than $625,000 for Unfair and Deceptive Foreclosure Relief Services (David Zak Targeted Homeowners with Deceptive Advertising and Charged Thousands in Illegal Advance Fees; Ordered to Cease Practices and Pay Civil Penalties and Consumer Restitution).
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(1) In an effort to seek some reimbursement for being screwed over, the victims here might try turning to the Massachusetts Clients' Security Board of the Supreme Judicial Court, which manages and distribute money collected from annual dues paid by members of the bar to members of the public who have sustained a financial loss caused by the dishonest conduct of a member of the bar acting as an attorney or a fiduciary.

For similar "attorney ripoff reimbursement funds" that cover the financial mess created by the dishonest conduct of lawyers licensed in other states and Canada, see:
Maps available courtesy of The National Client Protection Organization, Inc.

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