Illinois AG Nails 3 More Foreclosure Rescue Operators With Civil Suits

(original post 12-24-07)
From the office of the Illinois Attorney General:

• Attorney General Lisa Madigan has filed three lawsuits against mortgage rescue companies for allegedly violating the Illinois Mortgage Rescue Fraud Act and the Consumer Fraud and Deceptive Business Practices Act. [...] With today's filings, the Attorney General has sued 11 mortgage rescue companies. Madigan filed suit against Homeowners' Assistance Association, Lender's Foreclosure Relief, Inc., and United Home Savers, LLP, based on allegations that these three companies falsely promised to help consumers save their homes after falling behind on their mortgage payments.

• Madigan filed the Homeowners' Assistance Association complaint against the company and Casimar Cerniaukas (also known as “Casey Cerni”) and Jim Hamilton. The complaint also names as a defendant Foreclosure LMS, an affiliated company that purportedly trained people to conduct mortgage rescue services. Homeowners' Assistance Association is registered as an Illinois nonprofit corporation and deceptively claims to be affiliated with the City of Chicago 's foreclosure prevention program . The lawsuit alleges that the defendants charged homeowners illegal upfront fees of between $500 and $2,000 for mortgage foreclosure rescue services which either were never authorized by the consumer or proved ineffective.

• Madigan filed the Homeowners' Assistance Association complaint against the company and Casimar Cerniaukas (also known as “Casey Cerni”) and Jim Hamilton. The complaint also names as a defendant Foreclosure LMS, an affiliated company that purportedly trained people to conduct mortgage rescue services. Homeowners' Assistance Association is registered as an Illinois nonprofit corporation and deceptively claims to be affiliated with the City of Chicago 's foreclosure prevention program . The lawsuit alleges that the defendants charged homeowners illegal upfront fees of between $500 and $2,000 for mortgage foreclosure rescue services which either were never authorized by the consumer or proved ineffective.

• Madigan's suit against California-based Lender's Foreclosure Relief, Inc., alleges that the defendant charged Illinois homeowners illegal upfront enrollment fees of $1,395 for a “Pre-Foreclosure Workout Program.”

• The third lawsuit, filed against Florida-based United Home Savers, LLP, alleges that the company similarly required an illegal $1,200 upfront fee for services. Both Lender's Foreclosure Relief and United Home Savers failed to provide refunds for the illegal fees upon consumers' request.

For more, see Madigan Sues Three Mortgage Rescue Companies (Attorney General Seeks to Shut Down Businesses and Obtain Restitution for Distressed Homeowners).

Go here for other posts on foreclosure rescue lawsuits brought by the Illinois AG.

Links From Around The Country

1)

California Attorney General Bill Lockyer Files Criminal Charges Against Alleged "House Thieves"

Mortgage Fraud Blog reports that California Attorney General Bill Lockyer's investigation uncovered about 100 instances in which a husband and wife attempted to perpetrate some form of "home stealing" and which included one victim, a 78-year-old homeowner, who told investigators that he was living temporarily in a nursing home when he was victimized. Bail was set at $1.4 million.

2)

Illinois Attorney General Lisa Madigan Sues Two "Foreclosure Rescue" Companies; Announces Proposed Legislation To Prevent Home Equity Fraud

In one case, home owners paid fees to Internet "foreclosure consultants" ranging from $350 to $900. It is alleged that these "consultants" failed to engage in the promised negotiations and did nothing more than the home owners could easily do themselves.

The second case involved several victims in separate incidents. Victims in at least two of the incidents signed incomplete and blank paperwork, including a Power of Attorney Form, and ultimately received only a fraction of their home equity.

In addition it was announced that legislation (Illinois Mortgage Rescue Fraud Prevention Act) was proposed (and has subsequently been passed) in the Illinois state legislature by Madigan and two Illinois lawmakers which will help ensure that Illinois home owners do not pay money for non-existent services or see their hard-earned home equity in their homes disappear into thin air.

3)

Illinois Attorney General Lisa Madigan Strikes Again

The alleged "home equity thieves" in this case are being sued in a civil lawsuit for misleading homeowners to believe they could save their homes when in fact the homeowners were selling their homes to “foreclosure rescue” company employees who stripped out the substantial equity and left homeowners on the verge of eviction.

4)

Illinois Governor Rod Blagojevich Announces Shutdown of Major "Mortgage Rescue" Scam

The alleged "home equity thieves" in this case targeted homeowners vulnerable to foreclosure; victims unwittingly signed over ownership to dishonest lender. In connection with the filing of this civil lawsuit, the Illinois Department of Financial and Professional Regulation (IDFPR) issued an emergency suspension of the loan originator registration of one participant, and revoked the license of Mutual Trust Funding Corporation. IDFPR shut down seven title insurance agencies being charged with complicity in the “mortgage rescue” operation.

To view a copy of the Emergency Suspension of Loan Originator Registration please click here.

To view the Order Revoking License please click here.

5)

Indiana Attorney General Steve Carter Obtains Court Order Directing Refund of Fees Paid to "Foreclosure Consultant"

In this case, a court ordered a "foreclosure consultant" to refund fees of about $3,000 to three Indiana home owners and more than $82,000 in costs and penalties to the State of Indiana for failing to provide either a promised "work-out plan" or new financing.

Unfortunately in this case, all three home owners eventually lost their homes in foreclosure sales.

6)

Massachusettes Attorney General Tom Reilly Announces Investigation of "Foreclosure Rescue" Companies

In this report, several "foreclosure consultants" and "foreclosure rescue" businesses are being investigated for allegedly targeting homeowners by offering to "rescue" them from foreclosures, but instead trick them into deeding over their property. In many instances, homeowners have lost their homes and the equity they had built.

Attorney General Reilly has called on all Massachusettes homeowners who think they have been victims of a "foreclosure rescue" scam to immediately contact his office by calling the AG's Consumer Hotline at (617) 727-8400.

7)

Massachusetts Attorney General Tom Reilly Files Suit Against Three "Foreclosure Rescue" and Mortgage Fraud Operations

Mortgage Fraud Blog reports that emergency orders have been obtained by Massachusetts Attorney General Tom Reilly in each of three civil lawsuits, in which judges have ordered an immediate stop of illegal practices, and ordered the alleged "deed thieves" not to evict any homeowners or sell any of their homes.

8)

Missouri Attorney General Jay Nixon Obtains Consent Judgment and Permanent Injunction against "Foreclosure Consultants"

In this case, Missouri Attorney General Jay Nixon alleged in a civil lawsuit that the "foreclosure consultants" offered their services to a St. Joseph, Missouri resident who was in danger of losing his home to foreclosure. The "foreclosure consultants" approved him for a $20,000 loan, and then had him sign a general warranty deed on the house. The "consultants" claimed the deed was a second mortgage that was needed to secure the original loan, but instead it was designed to turn the man's home over to the defendants.

For an earlier report on this case, see:

Nixon files lawsuit to shut down fraudulent St. Joseph foreclosure consultant

9)

Homeowners Victimized By Foreclosure Rescue Scam

In this article by Dan Olson of Minnesota Public Radio, he reports:

In one matter, the Minnesota Attorney General's Office filed a civil lawsuit against an alleged "home equity thief" who has been reported as initiating 95 evictions and related actions involving reportedly questionable real estate deals.

One of the alleged victims took back the house that she says she was tricked into selling to the alleged "home equity thief". The next day, the alleged "home equity thief" called St. Paul, Minnesota police and had the home owner removed and arrested. She was charged with trespass and released from jail the same day;

In another unrelated matter, the Colorado Attorney General's Office filed a civil lawsuit on behalf of more than 100 homeowners. Ultimately, 70 of them won their homes back. There was a cash settlement of $1.1 million. Customers had been bilked out of an estimated $15 million.

10)

North Carolina Attorney General Roy Cooper Shuts Down Alleged Foreclosure Fraudsters

A Wake County, North Carolina Superior Court judge has ordered a "foreclosure assistance" company and its owner and president to cease operating while Attorney General Cooper’s civil lawsuit against them goes forward.

In this case, the "foreclosure assistance" company is accused of taking upfront fees from North Carolina home owners and then did little or nothing to help the home owners stave off foreclosure actions.

11)

Pennsylvania Prosecutor's Office Obtains Guilty Plea Against Home Thief

In one outrageous case, Real Estate Journal.com reports that a San Francisco man pleaded guilty to identity theft in Bucks County, Pa. This identity thief used information he obtained on 73-year-old man of Tinicum Township, Pa. to reroute the victim's mail to California. The thief then attempted to take ownership of the house in order to sell it, and even tried to convince a real-estate agent that the real homeowner was a squatter trespassing, court papers said. The scam artist pleaded guilty to identify theft and a host of other felonies and was sentenced to probation for 36 months and required to pay $775 in restitution, according to the Bucks County Court clerk's office.

12)

Detroit Man Gets 3 Years in Foreclosure Scam

Mortgage Fraud Blog reports that a Detroit, Michigan man was sentenced to 37 months imprisonment for mail fraud involving a scheme to cheat financially distressed Detroit homeowners whose homes were in foreclosure.

The man charged the homeowners a $1,000 fee in cash for his services and then eventually used bankruptcy petition filings to temporarily stop pending foreclosure actions.

The cases were eventually dismissed and the foreclosure proceedings were allowed to continue.
The U.S. Trustees Office has identified more than 20 such fraudulent petitions filed with the Federal Bankruptcy Court in Detroit, and several more were filed in a California Federal Bankruptcy Court after this "foreclosure fraudster" had been enjoined from filing any further cases in Detroit.

13)

Texas Attorney General Greg Abbott Files Emergency Action Halting Bogus Foreclosure Rescue Operation

Texas Attorney General Greg Abbott filed a legal action to stop a Houston woman from unlawfully exploiting distressed homeowners, some of them elderly, who face imminent foreclosure and eviction. A Harris County District Judge granted a temporary restraining order and asset freeze.

The Attorney General's News Release cites the case of an alleged "deed thief" who fraudulently takes possession of the home of an 85-year-old Houston man under the guise of helping the homeowner prevent foreclosure. The man allegedly was led to believe he was only allowing the "home equity thief" to consult with his mortgage company, but in fact the transaction allowed the alleged thief to take ownership of his home.

Click here for the Attorney General's Original Petition

Click here for the Court's Temporary Restraining Order/Asset Freeze

14)

California Judge Decides to Proceed to Trial in Matter of Accused "Deed Thieves"

A November 21, 2006 Modesto Bee article reports that three accused foreclosure scam artists face multiple felony counts of fraud and grand theft, and in a preliminary hearing that ended after five weeks of testimony. Stanislaus County Judge Hurl Johnson has decided that there is enough evidence to warrant a trial.

In addition, the article indicates that prosecutors still plan to file additional counts against the three people accused of swindling homeowners, with additional victims to be named, a spokesman said.

A Modesto Bee investigation revealed that the accused defendants had acquired at least 142 properties from people being threatened with foreclosure in four California counties.

The victims include an 86-year-old woman with dementia who has since died, a 66-year-old schizophrenic, a woman with brain lesions and several other disabled people.

Another victim said his parents, who had helped him buy his home, warned him not to get involved with the accused "deed thieves", and wrote him out of their will when he didn't listen. He said he should have cleared more than $100,000 in equity. Instead, he said, he lived out of his car after the men evicted him the day before Thanksgiving in 2003.

One victim accepted $10,000 for her home, thinking it represented a portion of the estimated $157,000 in equity her home had built over several years. She later realized she had signed over the deed, she said.

The woman asked not to be named for fear that family members would be angry. She had inherited the home from her mother.

Click Here for an earlier November 17, 2006 article on this story

Click Here for an earlier July, 2005 article on this story

15)

Texas Woman Accused of "Deed Theft" Pleads No Contest

A September 26, 2006 article by Elizabeth Allen in the San Antonio Express-News reports that a Texas woman pleaded no contest to two counts of securing execution of documents by deception in a "deed theft" scheme where she took over ownership of the home of an octogenarian.

At 81, the victim met the scam artist in 2002, and during that year she began draining his personal funds, according to court documents. After he fell and his health declined, she placed him in a nursing home.

"She put a note on his file that he was to have no visitors, especially family members," said Assistant District Attorney Joanne Woodruff.

The staff at the nursing home would spend their own money to buy the victim clothes, shoes and personal items because he had become so tattered, she said.

According to the follow up story, the "deed thief" ultimately was sentenced to 10 years in prison and ordered to pay more than $380,000 in restitution.

Click Here for the follow up story.

Follow up Story also available here

Illinois AG Tags Two With Criminal Charges For Allegedly Promising To Save Homeowners From Foreclosure By Peddling Sale Leaseback Schemes

From the Office of the Illinois Attorney General:

• Attorney General Lisa Madigan announced the arrest of a Chicago man who stole more than $350,000 in a wide-reaching mortgage fraud scheme in which they promised to help desperate homeowners avoid foreclosure.



• Madigan said defendant Warren Jackson, 41, of Chicago, was arrested late Thursday and is being held in Cook County jail. Yolanda King, 46, of Chicago, who was also charged in the scheme, was arrested on Jan. 10. Both were formally indicted earlier this month.



• Jackson was charged with one count of organizing a continuing financial crimes enterprise, four counts of financial institution fraud and three counts of theft by deception, one count of criminal mortgage rescue fraud, one count of forgery by delivery, and one count of false impersonation of an attorney. King was charged with two counts of financial institution fraud and one count of forgery by delivery.

***

• Jackson and King are facing six to 30 years and four to 15 years in the Illinois Department of Corrections, respectively.



• Madigan alleges that Jackson orchestrated two mortgage-related schemes involving Chicago homeowners. King was charged for her role in helping Jackson perpetuate these schemes. The first scam targeted homeowners at risk of foreclosure, promising to save their homes by negotiating lower mortgage payments. Madigan alleges that after collecting upfront fees, Jackson failed to negotiate or perform any services on behalf of the homeowners, placing their victims at even greater risk of foreclosure.



• In the second scheme, called a “sale-leaseback” to purportedly save the homeowner’s home,(1) Jackson used straw buyers to purchase homes from distressed homeowners, sometimes falsely promising them that they could pay rent for a year and then could potentially buy back the property. Jackson also tricked homeowners into unknowingly selling their homes to straw buyers by leading them to believe that they were signing paperwork for a new loan to help them avoid foreclosure.



• Madigan alleges that Jackson used the sale-leaseback scheme to transfer title from homeowners to straw buyers for the purpose of stripping the remaining equity from the home. Individual homeowners lost from $70,000 to $150,000 of equity in their homes as a result of the schemes.(2)

For the Illinois AG press release, see Madigan: Two Chicago Con Artists Arrested In Criminal Mortgage Scheme.
(1) For more on this type of foreclosure rescue ripoff, see:

• Criminal Prosecutions Of Sale Leaseback Peddlers In Equity Stripping Foreclosure Rescue Deals;
• Dreams Foreclosed: The Rampant Theft of Americans' Homes Through Equity-stripping Foreclosure 'Rescue' Scams (June 2005).

(2) At one time, many in state and local law enforcement (particularly those with untrained eyes and who were otherwise clueless in handling 'semi-sophisticated' white collar crimes - for some, anything more complex than investigating a 'rubber check' case is 'semi-sophisticated') once passed on prosecuting these sale leaseback equity stripping ripoffs that under the flimsy pretense that these cases were merely 'civil matters.'

Over the last couple of years, it's been primarily the Feds (U.S. Attorneys, FBI, Secret Service, etc.) that have been bringing prosecutions in these equity stripping ripoffs. However, as this story reflects, more and more state court prosecutors now appear to be stepping up to the plate and showing some guts by bringing criminal charges against these scammers. See, for example:

• Sale Leaseback Equity Stripping Peddler 'Scores' Guilty Verdict In Equity Stripping Ripoff; Grand Larceny, Scheme To Defraud, Conspiracy, Says Jury (Prosecuted by the Westchester County, NY District Attorney, a scammer who swindled four local families out of their homes was convicted after a jury trial of four felony counts of second-degree grand larceny and one each of first-degree scheme to defraud and fourth-degree conspiracy),



• Convicted Foreclosure Rescue Scammer Could Face Life Sentence On New Charges In Alleged Sale Leaseback, Equity Stripping Ripoff That Fleeced 5 Victims (Los Angeles District Attorney charged alleged scammer with 23 felonies — including theft from the elderly, identity theft and real estate fraud — for allegedly tricking five people into unknowingly granting him title to their homes, and charged him under California's 'three-strikes' law),



• Foreclosure Rescue Scam Mastermind Found Guilty Of Dozens Of Felonies; Ran Upfront Fee Land Grant Scheme, Sale Leaseback Rent Skimming Racket (After an eight-week trial, and through the efforts of the San Diego District Attorney, a scammer was found guilty of 160 counts of conspiracy to commit grand theft, grand theft, rent skimming and deceitful practices by a foreclosure consultant),



• Delaware AG Levels 21-Count Indictment Against Alleged Foreclosure Rescue Racket Using "Divine" Cover In Sale Leaseback, Equity Stripping Ripoff (The Delaware Attorney General obtained an indictment alleging that the scammer ran a criminal enterprise involving theft, money laundering, and forgery in which he preyed on vulnerable homeowners who faced imminent foreclosure),



• Central Florida Sale Leaseback Peddler Linked To 50 Ripoff Deals Gets 10 Years On Racketeering Charge; Targeted Cash-Strapped, High-Equity Homeowners (A joint prosecution by the Orange County, Florida and the state attorney general (under former AG Bill McCollum) led to the scammer copping a plea to a single count of felony racketeering after initially being charged with 12 first-degree felony counts, including racketeering, conspiracy to commit racketeering and numerous counts of grand theft),



• NY AG Squeezes Guilty Pleas From 4 For Roles In Alleged Sale Leaseback, Equity Stripping Foreclosure Rescue Racket; 1 Awaits Trial On 23 Felony Counts (After a New York Attorney General prosecution, four employees of a sale leaseback racket pleaded guilty in Albany County to felony charges that included grand larceny, scheme to defraud and falsifying business records, after the Attorney General's Office filed criminal complaints),



• Queens DA Bags Seventeen Suspects In Alleged Sale Leaseback, Equity Stripping Foreclosure Rescue Racket (Queens County, NY DA (joined in the probe by the office of the New York State Banking Department and the New York State Police) variously charged the defendants with first- and second-degree grand larceny, first degree criminal possession of stolen property, first-degree money laundering, first-degree identity theft, second-degree forgery, second-degree criminal possession of a forged instrument, first-degree falsifying business records, first-degree offering a false instrument for filing, first-degree scheme to defraud and fourth-degree criminal facilitation.).

Florida Firm Charged In 14th Civil Suit Brought By Illinois AG Against Foreclosure Rescue Operators

From the Illinois Attorney General's Office:

• [Illinois Attorney General Lisa] Madigan filed suit [last week] in Cook County against Law & Associates LLC, and its managing member, Thomas E. Law, II, alleging the defendants violated the [Illinois] Mortgage Rescue Fraud Act and the [Illinois] Consumer Fraud and Deceptive Business Practices Act by falsely promising to help consumers save their homes after falling behind on their mortgage payments. According to the complaint, the defendants charged consumers up to $1,900 and promised to provide mortgage foreclosure rescue services that they either failed to perform the services or only performed ineffective services. Attorney General Madigan’s Consumer Fraud Bureau has directly received one complaint relating to the defendant and 68 complaints referred from the Better Business Bureau.(1)

For more, see Illinois AG Sues 14th Company For Mortgage Rescue Fraud (Madigan Alleges Florida Company Takes Advantage of Homeowners on the Verge of Losing their Homes to Foreclosure).

For other recent civil actions by other state attorneys general against Law & Associates, see:

• Minnesota: State sues two firms that asked cash for foreclosure assistance (The attorney general says some companies claiming to help in a foreclosure do anything but),
• Florida: State of Florida v. Law & Associates, et al. (alleges an upfront fee foreclosure rescue operation).

(1) According to the Illinois AG's news release, Madigan’s suit asks the court to prohibit the defendants from engaging in mortgage rescue practices. The suit also seeks a civil penalty of $50,000, additional penalties of $50,000 for every violation found to have been committed with the intent to defraud, and a $10,000 penalty for each violation committed against a person 65 years or older. Further, the suit asks the court to rescind the contracts signed as a result of these deceptive practices and offer full restitution to affected consumers. Finally, Madigan’s suit asks the court to order the defendants to pay all costs associated with the investigation and prosecution of the lawsuit.

Illinois AG Continues Putting The Hammer On Upfront Fee Foreclosure Rescue Operators As Seven More Lawsuits Are Filed

From the Office of the Illinois Attorney General:

• Attorney General Lisa Madigan [yesterday] announced that she has filed seven new lawsuits(1) against so-called mortgage “rescue” companies and warned consumers about an alarming rise in these scams that prey on vulnerable homeowners on the verge of foreclosure.

***

• In each of the lawsuits filed late [Monday], Madigan alleges that con artists targeted homeowners who have fallen behind on their mortgage payments and promised that, for an upfront fee, the scammers could negotiate with the mortgage lenders to reduce the payments and save their homes.

• However, according to Madigan’s complaints, after these “consultants” collected the upfront fees, they failed to negotiate or perform any services on behalf of the homeowners, leaving consumers at risk of losing their homes to foreclosure.

• This tactic violates Illinois’ Mortgage Rescue Fraud Act, which prohibits mortgage rescue companies from requiring payment from consumers prior to completing all the terms of a rescue contract. [...] With these new filings, Madigan has brought lawsuits against 22 mortgage rescue fraud companies.

For more, see Madigan Sues Seven Companies For Mortgage Rescue Fraud (Attorney General Urges Consumers to Resist “Rescue” Schemes and Seek Reputable Assistance).

(1) Those companies sued, according to the Illinois AG press release (and links to copies of the lawsuits), are:

• National Foreclosure Counseling Services, 7954 Baymeadows Way, Jacksonville, Fla.,
• Foreclosure Solutions, 488 Pine Street, Burlington, Wis.,
• Homestead Protection Services, 151 Southhall Lane, Maitland, Fla.,
• Home Foreclosure Solutions, 17550 South Williamsburg Drive, Plainfield, Ill.,
• Foreclosure Experts, 220 S. State Street, Chicago,
• Mason Capital Group, 18375 Ventura Blvd., Tarzana, Ca.,
• StopMyForeclosure.net, 3914 Abbotsford Road, Rockford, Ill.

Illinois AG Files Civil Charges Against Two More Loan Modification, Foreclosure Rescue Operators; Lawsuit Tally Now Up To 24

From the Office of the Illinois Attorney General:

• Attorney General Lisa Madigan has filed two lawsuits in Cook County Circuit Court against Chicago-area mortgage rescue fraud schemes seeking temporary restraining orders to immediately stop the defendants from providing mortgage rescue services. Madigan made the announcement as part of a press conference [yesterday] in Washington, D.C., with U.S. Treasury Secretary Timothy Geithner, U.S. Attorney General Eric Holder, Federal Trade Commission Chairman Jon Leibowitz and U.S. Housing and Urban Development Director Secretary Sean Donovan, to discuss a coordinated effort by federal and state authorities to protect at-risk homeowners from mortgage foreclosure rescue fraud.

***

• Madigan filed complaints against Centurion Loss Mitigation Group, a Chicago-based operation and its owner Carlos A. Gomez, and Cash VIP, a Melrose Park, Ill.,-based operation and its owner Fernando Rios, also known as Fernali Ferrice.(1) With these new filings, Madigan has brought lawsuits against 24 mortgage rescue fraud schemes. Of those, the Attorney General, to date, has received judgments in nine cases, including more than $1.8 million in restitution for homeowners.

For the entire Illinois AG press release, see Madigan Files Two Mortgage Rescue Fraud Lawsuits, Seeks Immediate Ban on Companies' Operations (Illinois Attorney General Joins U.S. Treasury Secretary, U.S. Attorney General, Federal Trade Commission and HUD Leaders in Coordinated Plan to Protect At-Risk Homeowners).

(1) In the Cash VIP lawsuit, Madigan alleges the defendants sell credit and foreclosure “orientation” services, which require consumers to enroll in a one-year “membership club” and pay an upfront $575 application fee, $50 enrollment fee and a monthly fee of $69-89, as well as a final “success fee” that ranges from one to two percent of the loan amount, according to the AG's press release.

Illinois AG Files Civil Charges Against Upfront Fee Foreclosure Rescue Operator

The Illinois Attorney General announced:

• Illinois Attorney General Lisa Madigan today continued her aggressive battle against those taking advantage of homeowners in crisis by filing a lawsuit against an Ohio-based company(1) allegedly engaged in a mortgage rescue fraud scheme. The lawsuit claims the company violated the [Illinois] Mortgage Rescue Fraud Act and the [Illinois] Consumer Fraud and Deceptive Business Practices Act by preying on vulnerable homeowners on the verge of foreclosure. This is the 13th lawsuit Attorney General Madigan has brought against mortgage rescue fraud companies.

For more, see Illinois AG Sues Ohio Company For Mortgage Rescue Fraud (Madigan Alleges Company Takes Advantage of Homeowners on the Verge of Losing their Homes to Foreclosure).

(1) According to her press release, Madigan filed suit against Foreclosure Solutions, LLC and company president Timothy Buckley of Maineville, Ohio, based on allegations that the defendants falsely promised to help consumers save their homes after falling behind on their mortgage payments. The defendants charged consumers $1,250 and promised to provide mortgage foreclosure rescue services, which either were never performed or proved to be ineffective, according to the complaint.

FTC Announces New Lawsuits Against Upfront Fee Loan Modification Firms

On the heels of yesterday's "declaration of war" (see 'We Will Find You and We Will Punish You') by the Federal government against loan modification scams, the Federal Trade Commission announced the filing of three new lawsuits against firms it accuses of making false representations in conncetion with the improper clipping of homeowners for upfront fees, only to do little or nothing with regard to modifying their home loans. The new lawsuits involve:

• Federal Loan Modification Law Center(1) (FedMod). FedMod markets mortgage loan modification and foreclosure relief services to homeowners who are in financial distress, delinquent on their mortgages, or in danger of losing their homes to foreclosure. In radio advertisements, the FTC alleges, FedMod induces homeowners to call its toll-free number by misrepresenting that it is part of or affiliated with the federal government, although it is not.

For the lawsuit, filed in Los Angeles, California, see FTC v. Federal Loan Modification Law Center LLP, et al.

• Bailout.hud-gov.us. According to the FTC’s complaint, defendant Thomas Ryan used a foreign Internet registrar to falsely register two sites – bailout.hud-gov.us and bailout.dohgov.us. The sites were used to entice financially strapped consumers to seek mortgage loan modification services under the guise that the services were associated with, or were actually, the U.S. government, including HUD and the Treasury Department.

For the lawsuit, filed in the District of Columbia, see FTC v. Ryan.

• Home Assure d/b/a Expert Foreclosure.(2) In this case, the FTC alleges that the defendants promise consumers facing imminent home foreclosure that they can stop the foreclosure, regardless of the amount the consumer owes his or her lender. The defendants are charged with falsely claiming that they have special relationships with lenders, have helped thousands of consumers avoid foreclosure, and will provide a 100 percent satisfaction money-back guarantee. They typically charge consumers an up-front fee of $1,500 to $2,500 but, the FTC alleges, do little or nothing to help them avoid foreclosure and fail to give refunds when foreclosures are not stopped.

For the lawsuit, filed in Tampa, Florida, see FTC v. Home Assure, LLC, et al.

The FTC press release also contained a reminder of two additional lawsuits filed at the end of March against New Jersey outfits Hope Now Modifications LLC (go here for lawsuit) and New Hope Property LLC d/b/a New Hope Modifications LLC (go here for lawsuit), alleging that the defendants misled consumers about their ability to provide mortgage loan modification and foreclosure relief, and misrepresented that they were affiliated with or part of the HOPE NOW Alliance, the non-profit, HUD-endorsed organization that is a broad-based coalition of credit and home ownership counselors, lenders, and other mortgage market participants. These are the same two firms that were also recently sued by the New Jersey Attorney General for similar allegations.

The FTC notes:

• This brings to 11 the number of loan modification and mortgage foreclosure rescue scams brought by the FTC in the last year. More than 20 state law enforcers also have taken actions against companies engaged in these types of deception, including 22 brought by Illinois Attorney General [Lisa] Madigan.

• The FTC also announced [yesterday] that it has sent warning letters to 71 companies who may be deceptively marketing mortgage loan modification or foreclosure rescue services. The FTC identified these companies through a nationwide review of Internet and other advertisements and warned these companies that their ads may violate federal law. State law enforcers also have sent warning letters to companies that are potentially engaging in such illegal practices, including more than 60 warning letters sent by Attorney General Madigan.

For the entire FTC press release, see Federal and State Agencies Crack Down on Mortgage Modification and Foreclosure Rescue Scams (FTC, State Enforcers Sue Scammers, Warn Others; Announce Education Campaign Designed to Reach Borrowers Directly).

(1) The defendants in this case are: Federal Loan Modification Law Center LLP doing business as Federal Loan Modification Law Center and under other various other names; Anz & Associates, PLC; LegalTurn, Inc.; Federal Loan Modification LLC; Boaz Minitzer, Nabile "Bill" Anz, and Jeffrey Broughton.

(2) The defendants in this case are: Home Assure, LLC, B Home Associates, LLC, doing business as (dba) Expert Foreclosure, Michael Grieco, Michael Trimarco, Nicholas Molina, and Brian Blanchard. The defendants also have been the subject of law enforcement actions or investigations by the Minnesota, North Carolina, and Florida Attorneys General, according to the FTC press release.

CBS News On Upfront Fee Loan Modification, Foreclosure Rescue Scams

The CBS News' The Early Show ran a story last week on loan modification, foreclosure rescue scams that are proliferating across the country. Interviewed for the story was Illinois Attorney General Lisa Madigan, and one Illinois homeowner facing foreclosure on her condo who wound up getting clipped for $2,000 from a company that approached her with a solicitor who appeared at her front door.

• [The homeowner] says she signed a contract with a company named Foreclosure Solutions. She initially gave them $695 and later paid them another $1400 which they said they'd forward to her lender. "The things he was telling me was just what I needed at that particular time," [she] said. [She] says she believed her mortgage problem was being addressed. So imagine her shock when she found out her home was just days away from being auctioned off. "I was really, really upset. I cried. Yes, I did," [she] said. [... She] lost $2,000 and had to file for bankruptcy in order to save her home.

Illinois Attorney Lisa Madigan has filed a lawsuit against Foreclosure Solutions, charging that they did not contact consumers' lenders immediately as promised and that instead of forwarding the mortgage payments, they kept the money.

For more, see Beware Of Forclosure Rescue Scams (People Facing Foreclosure Are Being Victimized) (read text) (watch video).

Illinois AG Tags Four Alleged Loan Mod Rackets w/ Suits Claiming Attorneys Were Used To Create Impression Homeowners Were Getting Legit Legal Services

From the Office of the Illinois Attorney General:

• Attorney General Lisa Madigan [] filed lawsuits against four Chicago area companies and licensed attorneys for operating fraudulent mortgage rescue or loan modification schemes that illegally charged consumers as much as $375,000 for little, if any, help to stay in their homes and avoid foreclosure.(1)



• Madigan’s actions are part of a multi-agency effort to crack down on a growing number of Illinois attorneys and loan modification operators who illegally exploit a provision in the 2006 Mortgage Rescue Fraud Act that allows lawyers to collect upfront fees from homeowners for mortgage rescue services in the course of legitimate legal work.



• While the businesses use attorneys as the face of their operations in order to charge upfront fees, in reality the attorneys performed no legal work on behalf of homeowners. Madigan said their failure to provide legal services left consumers at an even greater risk of losing their homes to foreclosure.

***

• To date, Attorney General Madigan has filed 46 lawsuits over the illegal collection of upfront fees by mortgage rescue operations.(2)

For the Illinois AG press release, see Madigan Conducts Mortgage Fraud Sweep, Files Four Lawsuits Against Chicago Area Mortgage Scams (Attorney General Joins Multi-Agency Task Force to Crack Down on Foreclosure “Rescue” and Consumer Debt Schemes).

(1) The Attorney General filed suit in Cook County Circuit Court against ZeTrust Legal Services, of Chicago; Legal Modification Network LLC, based in Woodridge; Loan Litigators International LLC, a now defunct company that operated out of Lombard; and Exelpol Management & Consulting Inc, a dissolved corporation based in Schaumburg.

As part of a task force effort, the Cook County State’s Attorney’s Office filed a similar lawsuit in Cook County Circuit Court against an Arlington Heights-based loan modification and debt settlement company, Legal Housing and Debt Advisor LLC, along with Jason Tong, its managing member and principal owner.

(2) Given that law enforcement agencies typically operate with a shortage of financial resources, prosecuting these alleged lowlifes by bringing 46 civil lawsuits is probably much cheaper and easier than having to prosecute them with criminal charges (ie. theft by deception, obtaining money or property by false pretenses, conspiracy to defraud, etc., etc., etc.), which may require more time and effort, and where, given the burden of proving the case is greater (ie. "proof beyond a reasonable doubt" vs. "proof by a preponderance of the evidence"), the risk of losing the case is also greater.

Illinois AG Brings Civil Suit Against Foreclosure Rescue Service

(revised 8-17-07)
From the Illinois Attorney General:

• "Attorney General Lisa Madigan [last Thursday] filed a lawsuit against a mortgage foreclosure rescue company for violating Illinois ' recently-enacted Mortgage Rescue Fraud Act, as well as the Consumer Fraud and Deceptive Business Practices Act. Madigan's lawsuit, filed against American Housing Authority, Inc., a Nevada corporation, and its president, Brandon Roberts, alleges that the defendants defrauded homeowners by falsely promising to help them escape foreclosure, taking their money [$1,400] as a fee, and then failing to provide any real help. [...] In the complaint, Madigan's office asks the court to order the defendants to pay restitution to defrauded homeowners and to stop all deceptive business practices. The suit also seeks a civil penalty of $50,000 and additional penalties of $50,000 for each violation found to have been committed with the intent to defraud."

For more, see Illinois AG Press Release - Madigan Sues Mortgage Company For Deceiving Homeowners In Foreclosure (Attorney General Seeks to Shut Down Business and Obtain Restitution for Homeowners).

For a copy of the lawsuit (thanks to the Illinois AG's office), see State of Illinois vs. American Housing Authority, or if there's a problem with the link, drop me a line at HomeEquityTheft@yahoo.com (be sure and put "Illinois vs. American Housing Authority" in the "Subject" line) and I'll e-mail you a copy.

See also Illinois AG Sues Mortgage Company For Deceiving Homeowners In Foreclosure (All American Patriots).

Go here for other posts on American Housing Authority and Brandon Roberts. upfront fee

ABC's Good Morning America On Foreclosure Rescue

Good Morning America did a story on foreclosure rescue on Tuesday featuring an Illinois homeowner and the problems she faced.

• Dorothy Galbreath lived in a house her husband of 43 years built for her in University Park, Ill., but after his death, she struggled financially to keep up with the mortgage payments. Facing foreclosure, Galbreath accepted the offer of a company that she said contacted her to help with her mortgage difficulties. "'Mrs. Galbreath, don't you worry. We're going to save your home,'" Galbreath said Alternative Options, the company offering aid, told her. Now Galbreath is without her beloved home, and she believes Alternative Options took advantage of her. "I still can't put it into words. It's like a feeling of being crushed," the former homeowner said. "This is 43 years just wiped away, just like it was never there. All my life [was] wiped away like it never existed." The Illinois attorney general's office said Galbreath's deal showed all the signs of a mortgage rescue scheme.

***

• When Alternative Options initially approached Galbreath, she believed it would help her refinance her home, but after waiting more than a month for aid, Galbreath, a school bus driver, got further behind in her mortgage payments. Then she said she learned the company had a different form of mortgage rescue in mind. Galbreath said she was unaware that she was actually selling her home until she got to the bargaining table in May. She claimed Alternative Options never told her before the meeting that she was selling her house. "So right then and there, it was either sign the papers or go ahead into the foreclosure," she said.

***

• Alternative Options told ABC News in a written statement that its purchase of Galbreath's home "prevented the foreclosure" and it took several steps to help her buy her home back. The company added it regretted that she couldn't buy back her home and said it has "had significant success with other homeowners."

***

• ABC News asked the Illinois attorney general to review Galbreath's case. "We are subpoenaing this company to find out their business practices and to make sure that there are not other people similarly situated to Dorothy who have ended up losing their homes due to fraud," said Illinois Attorney General Lisa Madigan. "For so many people in the United States, their home is really their bank account. And so in addition to the devastation they face when they lose their home, they're also losing & their life savings."

For the entire transcript of the story, see Beware of Mortgage Foreclosure Rescue Scams (Find Out the Tips You Need to Protect Yourself).

Go here to watch the Good Morning America report (available online courtesy of Yahoo! News).

*****************

ABC News' Good Morning America also broadcast a story on 2-24-09 on the "Produce The Note" strategy of hammering sloppy lenders and their attorneys attempting to foreclose on homes without first establishing in court that they have the legal standing to do so.

For the story (approx. 5 minutes), see Fighting Against Foreclosure (Some homeowners have found a new tactic to keep the banks at bay).

Illinois AG Files Civil Suit Against Foreclosure Rescue Operator

From the office of the Illinois Attorney General:

• "As part of her ongoing efforts to target scam artists committing mortgage fraud, Attorney General Lisa Madigan has filed a lawsuit against a Michigan-based business operating a mortgage rescue scheme that strips the home equity from unsuspecting homeowners and usually causes the owners to lose their homes. Madigan filed the suit in Cook County Circuit Court against RYM Technology Holdings, LLC, an investment company which does business as RYM Tech, LLC, and its owner, Felix L. Daniel, Sr. According to the lawsuit, since at least 2003, RYM Tech and Mr. Daniel have solicited Illinois consumers to participate in their “Mortgage Reduction Program” by claiming that through this program, consumers can own their homes free of mortgage debt in five years."

Rym Tech and Mr. Daniel were among the featured foreclosure rescue operators in a July story in The New York Times, Predators Bilk Struggling Homeowners.

For more on the recent Illinois lawsuit, see Illinois AG Press Release, Madigan Continues Fight Against Mortgage Fraud (Sues Michigan Company Operating a Mortgage Rescue Scheme).

For a copy of the lawsuit (thanks to the Illinois AG's office), drop me a line at HomeEquityTheft@yahoo.com (Be sure to put "State of Illinois vs. Rym Tech" in the "Subject" line), and I'll e-mail it to you.

See also, Illinois AG Madigan Continues Fight Against Mortgage Fraud (All American Patriots).

Illinois AG Sues Upfront Fee Foreclosure Rescue Operator

From a September 14, 2007 Illinois Attorney General Press Release:

• Attorney General Lisa Madigan today filed a lawsuit against a Florida–based mortgage rescue company for allegedly violating Illinois ' recently-enacted Mortgage Rescue Fraud Act, as well as the Consumer Fraud and Deceptive Business Practices Act.

[...]

• Madigan's suit alleges that Florida-based Mortgage Assistance Solutions, LLC, and its managing member Michael Thomas Stoller, of Beverly Hills , California , defrauded desperate Illinois homeowners who enrolled in its “Fresh Start” program by falsely promising to negotiate with the homeowners' lenders to reduce their mortgage payments or save their homes from foreclosure. The company requires an upfront enrollment fee but, in the end, provides homeowners with little or no help.

[...]

• Madigan's complaint describes how the defendants, in some cases, solicit homeowners by taking advantage of their fear of losing their homes with postcards that read, “YOU WILL LOSE YOUR HOME IF YOU DON'T CALL NOW!!!!” When contacted by potential customers, Mortgage Assistance Solutions refuses to discuss the specific programs available until they receive a $1,200 payment from the homeowners.

[...]

• The Attorney General is asking the court to order restitution for the defrauded homeowners and to order the defendants to stop all deceptive business practices. The suit also seeks a civil penalty of $50,000 and additional penalties of $50,000 for each violation found to have been committed with the intent to defraud.

For more, see Madigan Utilizes New Law To Sue Mortgage Rescue Company (Attorney General Seeks to Shut Down Business and Obtain Restitution for Distressed Homeowners).

Go here for stories on Mortgage Assistance Solutions and its "Fresh Start" program dealing with homeowners facing foreclosure in Tennessee and Massachusetts.

See Ripoff Report for links to complaints against Mortgage Assistance Solutions.

Illinois AG Hauls Another Foreclosure Rescue Operator Into Court For Alleged Violation Of State Law; Count Now Up To 15 Firms

From the Illinois Attorney General's Office:

• Illinois Attorney General Lisa Madigan [yesterday] continued her aggressive legal fight against mortgage fraud by filing a lawsuit against a St. Marys, Pa., company, which has been operating a mortgage rescue fraud scheme and preying on vulnerable Illinois homeowners on the verge of foreclosure.

• Madigan filed suit in Sangamon County Circuit Court against Aeroworks, LLC, doing business as Augustus Rae and Reed, and its president, John F. Reed. The suit alleges that the defendants violated the Mortgage Rescue Fraud Act and the Consumer Fraud and Deceptive Business Practices Act by falsely promising to help consumers save their homes after they have fallen behind on their mortgage payments.

• According to the complaint, the defendants charge consumers up to $1,185 in upfront fees for homeownership counseling and mortgage rescue services but rarely produce successful results. They also fail to give consumers the right to cancel at any time. The complaint alleges that the defendants accepted money from at least 215 consumers throughout Illinois during 2006 and 2007.

For more, see Madigan Sues Pennsylvania Company For Mortgage Rescue Fraud (Company Preys On Illinois Homeowners Facing Foreclosure).

Illinois AG Files Civil Suit Against Pair For Allegedly Running Sale Leaseback Foreclosure Rescue Racket That Targeted Senior Citizens

In Chicago, Illinois, Courthouse News Service reports:

• Two con artists promised to save distressed homeowners' houses from foreclosure, then tricked them into signing away their deeds, the Illinois attorney general says in Cook County Court. The state claims Warren Jackson and Yolanda King, and their companies W2X, PTU I, Y2X, and Goldburg Bail-Out, selected their victims "by reviewing Illinois foreclosure filings." Attorney General Lisa Madigan said the lawsuit came in response to eight complaints to her office.

***

• Jackson and King promised to help homeowners refinance mortgage loans and stop foreclosure proceedings, then would "take the title from the homeowner's property and strip almost all of the homeowner's equity," Madigan claims in the lawsuit.(1) The "equity stripping scheme" targeted senior citizens with little understanding of the residential mortgage loan industry, according to the complaint.

***

• Most victims were unable to buy back their homes, due largely to the lost equity and the exorbitant fees that King and Jackson took without their victims' knowledge, and for consulting work they never performed, according to the complaint. The complaint does not estimate the total damages done. Madigan demands restitution for the victims and civil penalties of $50,000 per violation of the [Illinois] Mortgage Rescue Fraud Act.

For more, see AG Alleges Heartless Mortgage Frauds.

For the Illinois AG press release, see Attorney General Madigan Joins U.S. Attorney General Holder To Announce National Sweep Against Mortgage-Related Fraud (Madigan Files Two Lawsuits as Part of Operation Stolen Dreams Initiative).

For the lawsuit, see People v. Jackson, et al.

(1) According to the Illinois AG lawsuit (paragraphs 21-24):

• In return for the loans, defendants require the homeowners to sign over their houses to defendants or someone affiliated with defendants. In some cases, however, the homeowners do not realize that they are giving up their homes. Instead, they believe that defendants Jackson and King, through defendants W2X, Y 2 X and PTU I, have merely refinanced their mortgage. They think they are making their 'mortgage' payments to defendants, but in reality, they are just paying rent to defendants. Under the guise of signing loan documents, defendants give these homeowners warranty deeds or similar instruments that transfer title to their homes. Some homeowners are told by Defendants that they are signing over title to their properties for a one to two year period. During this period, Defendants tell the homeowners that they can stay in their properties by paying rent.

According to the complaint, individual homeowners lost from $60,000 to $149,000 of equity in their homes as a result of W2X’s fraudulent schemes.

Illinois AG, Foreclosure Rescue Operator Reach Settlement In Civil Suit

From the Office of the Illinois Attorney General:

• As part of her ongoing efforts to target scam artists committing mortgage fraud, Attorney General Lisa Madigan has successfully reached a settlement agreement with a Charlotte, North Carolina-based business operating a mortgage rescue scheme that falsely promised to help financially distressed homeowners who were facing foreclosure.

• According to the settlement announced [yesterday], HomeSavers USA, Inc. and its CEO, David Moakler, will cease offering and accepting money for foreclosure rescue services in Illinois. Customers of HomeSavers USA have until March 21, 2008, to file a complaint with the Illinois Attorney General’s office for full or partial refund of the fees they paid to the defendants.

For the entire Illinois AG news release, see Madigan Reaches Settlement With Mortgage Rescue Firm.

Michigan Man Accuses Florida Firm Of Foreclosure Rescue Ripoff

In Trinity, Florida, Tampa Bay's 10 News reports:

• Richard Taylor found United Home Savers on the Internet to help him with his foreclosure in Wyandotte, Michigan. "For a fee, they would work with my mortgage and bank to help me get a lower rate and a lower payment for a certain amount of years," said Taylor. In April Taylor paid United Home Savers more than $1,100. He heard back from the company about a month later. "They couldn't do nothing," said Taylor. "So I says, 'If you can't do nothing for me, then I want my money back.'" But he still hasn't gotten his money back. Taylor even traveled to United Home Savers office in Largo.

***

• The Federal Trade Commission filed a federal lawsuit against United Home Savers and officers Stephanie and Darin Dietschy earlier this month. A sign on the company's office in Largo says it is currently under court order by the FTC that all information in this building is frozen. Illinois Attorney General Lisa Madigan has also filed a lawsuit against United Home Savers. [...] Florida legislators recently passed a new law regulating mortgage rescue companies. Starting October 1st, they cannot accept any payment, until they provide you with a service.

For more, see Viewer wants refund from mortgage rescue company (read story) (watch Channel 10 video).

For story update, see Viewer's brother with mortgage rescue problem gets money back (Richard Taylor tells 10 News he has received $1,000 cash back from Brian Mehle, one of the directors of the mortgage relief company that took over from United Home Savers.).

From the Federal Trade Commision:

• Copy of Lawsuit - Federal Trade Commission v. United Home Savers, LLP, et al.,
• Temporary Restraining Order with Asset Freeze and Other Equitable Relief and Order to Show Cause Why a Preliminary Injunction Should Not Issue,
• FTC Press Release - FTC Acts Against Two Family-Owned Mortgage Foreclosure ‘Rescue’ Operations.

State AGs Target Califormia Upfront Fee Foreclosure Rescue Operator

American Housing Authority ("AHA"), a California-based company in the business of providing foreclosure consulting services in exchange for an upfront fee has been recently sued by the Attorneys General for Illinois and Ohio for alleged conduct in connection with its foreclosure consulting business.

In Illinois, Attorney General Lisa Madigan filed suit against AHA (doing business as American Housing Help) and its president, Brandon Roberts, for violating Illinois ' recently-enacted Mortgage Rescue Fraud Act, as well as the Consumer Fraud and Deceptive Business Practices Act and alleges that AHA and Roberts defrauded homeowners by falsely promising to help them escape foreclosure, taking their money as a fee, and then failing to provide any real help.

In Ohio, Attorney General Marc Dann filed suit against AHA and, according to the complaint, affiliate American Housing Financial, Inc. ("AHF") - principal place of business in Phoenix, Arizona - for violating a number of Ohio consumer protection laws. The complaint in this case identifies Brandon Roberts as AHA's president, and Mace Miller as AHF's president.

For more on the Illinois case against AHA and Roberts, see:

• Illinois AG Press Release
• Copy of lawsuit - State of Illinois vs. American Housing Authority

For more on the Ohio case against AHA and AHF, see:

• Ohio AG Press Release
• Copy of lawsuit - State of Ohio vs. American Housing Authority, American Housing Financial.

A recent media report mentions American Housing Authority in connection with an alleged problem that a Texas resident facing foreclosure reportedly had with the foreclosure consulting services (see Texas Homeowner Facing Foreclosure Falls For Upfront Fee "Rescue" Offer). No word if any official investigation has taken place in that reported incident.

Debt Renegotiation Scams Not Limited To Foreclosure Rescue, Loan Modification Firms As Illinois AG Hammers Settlement Outfits In Separate Civil Suits

From the Office of the Illinois Attorney General and the Illinois Department of Financial and Professional Regulation:

• Attorney General Lisa Madigan and Acting Secretary of the Illinois Department of Financial and Professional Regulation (IDFPR) Michael T. McRaith warned consumers facing significant credit card debt about the risks of debt settlement offers as she announced two lawsuits filed against debt settlement firms.(1) Attorney General Madigan's lawsuits allege that these companies engage in deceptive marketing practices, charge excessive fees and do little or nothing to improve consumers financial standing.

***

• Madigan said her office has seen an increase in advertisements for debt settlement companies that promise to significantly reduce consumers credit card debt and provide them with an alternative to bankruptcy protection. Typically, after consumers enroll in debt settlement programs, the companies charge excessive upfront fees and advise consumers to stop paying their credit card bills. Despite this advice, the debt settlement companies fail to begin negotiations with consumers credit card companies for several months. As a result, credit card companies add fees and penalties to consumers credit card balances and often even begin collection efforts to recoup the debt, all of which puts the consumers in a worse financial situation. In many instances, while consumers were enrolled in debt settlement programs, credit card companies have sued the consumers to collect the balance on the consumers accounts.

For the entire Illinois AG press release, including a summary of the specific allegations against each outfit, see AG Madigan Sues Two Debt Settlement Firms (Attorney General, IDFPR Warn Consumers About Firms Promising to Reduce Credit Card Debt).

(1) AG Madigan sued the following defendants:

• 1st lawsuit: SDS West Corporation, an Aliso Viejo, Calif.-based debt settlement agency; Bruce Hood, the Chief Operating Officer of SDS West; SDS West's Chief Executive Officer, Raymond Dorso; Nationwide Support Services, Inc., an Irvine, Calif.-based debt settlement servicer; and Joanne Garneau, President of Nationwide Support Services.
• 2nd lawsuit: Debt Relief USA, Inc., a debt settlement firm based in Addison, Texas and Kelly E. Reilly, the President of Debt Relief USA.