Tennessee AG, Memphis Legal Services Firm File Suits Against Upfront Fee Foreclosure Rescue Operator

In Nashville, Tennessee, WTVF-TV Channel 5 reports:

• The Tennessee Attorney General filed suit Tuesday against a company suspected of charging consumers for services it and its principals have not provided. The lawsuit filed against Tennessee Housing Protection Agency, Inc., alleges violations of consumer protection laws.

• "With foreclosures in Tennessee going up, we are concerned that homeowners across the state may turn to ‘foreclosure rescue' operations such as this that in some cases offer only false hope," said Tennessee Attorney General Bob Cooper, in a news release.

• The lawsuit also alleges that the Memphis-based company's name is misleading and deceptive to consumers. The name sounds similar to an agency authorized by the state. The company is not a government agency and is not affiliated with the state.

• The Memphis Area Legal Services also filed lawsuits against the company and its principals.

Source: AG Files Suit Against Foreclosure Rescue Company.

Go here for the WTVF-TV Channel 5 video.

See also:

• Tennessee AG's press release: Attorney General Files Suit Against Tennessee Foreclosure Rescue Company,
• Memphis Commercial Appeal: Home-loan help agency faces suit (Foreclosure rescue 'unfair, deceptive,' customers say).

Tennessee AG, MALS Tag Another Upfront Fee Foreclosure Rescue Operator With Lawsuits

From the Office of the Tennessee Attorney General:

• Tennessee Attorney General Bob Cooper filed suit [Tuesday] to stop another Tennessee foreclosure rescue company and its principal from charging service fees to consumers and then failing to follow through with the services promised. The lawsuit filed [Tuesday] alleges violations of consumer protection laws.(1)

***

• The State’s complaint, which was filed in Shelby County Chancery Court, also alleges violations of the Tennessee unauthorized practice of law statutes(2) and the Tennessee Credit Services Businesses Act.

• Memphis Area Legal Services also filed a lawsuit today in Shelby County Chancery Court against the defendants.(3)

For the AG's press release, see Attorney General Files Suit Against Tennessee Foreclosure Rescue Company, Requests Asset Freeze, Halt To Alleged Unlawful Activities.

For legal documents in this case, see:

• Lawsuit/Complaint - State of Tennessee v. Patrick and Patrick, LLC, et al.; and
• Motion for temporary injunction and asset freeze.

See also, Eyewitness News ABC24-CW30: Scammed into Foreclosure.

(1) According to the AG's press release, Attorney General Cooper on behalf of Mary Clement, director of the Division of Consumer Affairs, sued Patrick & Patrick, LLC doing business as Patrick & Patrick Loss Mitigation Services, and its principal, Denise Patrick, also known as Sondrette D. Patrick. The defendants are also doing business via the Internet at www.patrickandpatricklm.com. (Note: At some point after this story came out, the firm took down their website.

(2) Bringing charges of unauthorized practice of law against upfront fee loan modification / foreclosure rescue operators appears to be gaining steam - the Florida Attorney General reportedly made similar allegations in a recent lawsuit brought against a loan modification company. Go here and go here for other posts on issues relating to attorneys, loan modifications, and the unlicensed/unauthorized practice of law.

(3) Last month, the Tennessee Attorney General's office and Memphis Area Legal Services also filed multiple lawsuits against another upfront fee foreclosure rescue operator, according to this press release. UnauthPractOfLawKappa

Memphis Loan Modification / Foreclosure Rescue Firm Agrees To Temporary Injunction With Tennessee AG; Will Stop Clipping Homeowners For Upfront Fees

In Memphis, Tennessee, Memphis Commercial Appeal reports:

• Memphis mortgage rescue company Patrick & Patrick Loss Mitigation Services has agreed to stop what the Tennessee Attorney General charged in a Nov. 18 lawsuit (go here for the Tennessee AG's Nov. 18 press release; here for the Tennessee AG's lawsuit; and here for Motion for Temporary Injunction & Asset Freeze) were illegal activities.

• According to the temporary injunction agreed to Tuesday by the firm and the attorney general, the firm may not engage in unfair or deceptive business practices, practice law, offer credit services without registering a bond with the state and must tell consumers in writing what services the firm and its people have provided before getting paid.

For more, see Memphis mortgage rescue company agrees to stop 'illegal practices.'

For Tennessee Attorney General Bob Cooper's January 13, 2009 press release, see: Tennessee Foreclosure Rescue Company Enters Agreed Order to Halt Alleged Unlawful Activities.

Tennessee Couple Loses Home In Phony Foreclosure Rescue Scam; Operators Turn Out To Be Convicted Felons

In Hardemon County, Tennessee, WREG-TV Channel 3 reports on a local couple facing foreclosure who was offered and accepted assistance from Freedom Property Investment, a foreclosure rescue company that turned out to be a scam.

• WREG News Channel 3 Investigators spent weeks trying to track down the company's president, William Boxley. It turns out, Boxley was was cited for driving with a revoked license in Memphis back in March. Records show Boxley never showed up for court. The address he gave police is really a Hickory Hill office complex. Workers there tell us Boxley, and Thomas Frank Montgomery, wanted to open up shop there.

• Court records show Montgomery was just released from federal prison in December. He was serving time after getting caught with nearly 73 pounds of marijuana. A check of arrest records shows Boxley is an ex-con too. He was convicted, and sentenced to 8 years in prison on cocaine charges. In addition, the man who promises to "stop the stranglehold on your financial well-being", in his letter to [the homeowners], has filed bankruptcy.

• So how can someone with Boxley's history run a company promising foreclosure relief? State Senator Roy Herron explains it this way. "It's like the wild wild west," Herron said of the foreclosure rescue industry. "There's no regulation. There's not good statutory protection for people." Herron sponsored a bill that would ban foreclosure rescue companies from charging anything upfront.

For the story, see Homeowners Warned Of Foreclosure Relief Rip-Offs.

Go here to read recent FTC Warning Letter to loan modification firms, and here for the FTC Foreclosure Warning List.

Trial Begins For "Sovereign Citizen" Accused In F'closure Rescue, Loan Reduction Scam; Judge Rejects "Diplomatic Immunity/Moor Defense" As "Gibberish"

In Memphis, Tennessee, WMC-TV Channel 5 reports:

• "Heartache, pain & trouble" -- one pastor's description of what's floating in the wake of Charles McKuhn. Testimony in the Bartlett man's federal fraud trial began in earnest Tuesday as he faced charges of running a debt-reduction/foreclosure rescue scheme that spanned nine states.

• Last March, a federal grand jury indictment charged McKuhn and his company, Taurian Worldwide, Inc. (TWI) with bilking more than $500,000 from churches and individuals in the wire-transfer lending scheme. The indictment said between June 2007 and June 2009, McKuhn schemed to defraud "...various individuals and institutions, by representing himself as a legitimate debt reduction service, and international private banker, able for a front-end fee to reduce the debt owed by individuals and institutions and establish lines of credit and secured loans for building projects."

• In testimony Tuesday, pastors from churches in Alabama, Tennessee and Virginia said McKuhn, who holds no credentials in banking or finance, claimed TWI held a federal bond that could be used to underwrite pay-offs of their churches' delinquent mortgages. "He said he had a 'blanket bond' through the Federal Reserve that could be used to pay down the debt," said Bishop James W. Johnson of Birmingham, AL. Johnson testified his home church is Christ Temple Holiness Church of the Apostolic Faith in Opelika, AL.

• Johnson and two other pastors testified they paid McKuhn and TWI cash installments -- one as much as $85,000 -- to either secure a line of credit to pay off their mortgages or to have TWI assume the loans and "discharge" the debt. Johnson testified he even signed on to be a representative of TWI and recruit other pastors. Each testified McKuhn took their money, did nothing -- and the banks foreclosed on their properties.

• McKuhn is representing himself, often asking witnesses meandering and confusing questions on cross-examination. U.S. District Court Judge Jon P. McCalla appointed Memphis attorney Sam Perkins to be McKuhn's "elbow" counsel, but McKuhn has ignored Perkins throughout testimony. "He wouldn't talk to me," said Perkins. "I have no indication at all on where he's going or how I can assist him."

• In previous court appearances, McKuhn argued the federal courts can't prosecute him because he's a sovereign American Moor whose allegiance is to his Moroccan-African heritage, not to the United States. "I'm demanding common law jurisdiction as a Native American Moor," McKuhn said in court last summer. "I do not consent to this proceeding. I'm not a 14th Amendment citizen. This court does not have jurisdiction in this case."

• The U.S. Constitution's 14th Amendment provides that "All persons born or naturalized in the United States and subject to the jurisdiction thereof, are citizens of the United States." According to investigators' case records, McKuhn is a naturalized American citizen. A certificate of birth abroad indicated he was born in 1977 to his American parents at a U.S. Army hospital in Germany. A 2007 state department document confirmed McKuhn is a U.S. citizen.

• McCalla told McKuhn his "Moor defense" is a tired, misguided strategy tried by countless defendants in district courts nationwide. "What (McKuhn's) talking about is gibberish," said McCalla from the bench in the July proceeding. "I don't think I have any choice but to take him into custody. Since he has no respect for the law of this country, I can't be certain that he won't (flee the country)." McKuhn has been in the custody of U.S. marshals ever since.

• Blake Ballin, McKuhn's former attorney, said the diplomatic immunity/Moor defense is a sign McKuhn is under tremendous pressure.

For more, see Pastors testify at debt/foreclosure fraud trial.

For a story update, see Debt/foreclosure scam artist found guilty:

• [A] federal jury found Charles McKuhn guilty on seven counts: two counts of mail fraud, four counts of wire fraud and one count of money-laundering.

Go here for other posts on rackets involving so-called sovereign claims.

For the details of the criminal charges, see U.S. v. McKuhn.

So-Called 'Sovereign Citizen' Gets 17+ Years For Screwing Over 17 Churches In Bogus Debt Reduction Foreclosure Rescue Scam

In Memphis, Tennessee, The Commercial Appeal reports:

• A Memphis man has been sentenced to 17 1/2 years in federal prison after his conviction earlier this year of running a bogus debt-reduction company that defrauded regional churches of hundreds of thousands of dollars.
• Charles A. McKuhn Jr. traveled to several states in 2009 and met with pastors and church officials, falsely represented himself as a banker and persuaded them to pay him large sums of money for debt reduction and lines of credit for building funds, court documents show.
• He also convinced churches that owed debts to banks and other lending institutions not to pay those institutions, but to pay his companies called Intersec Capital Trust and Taurian Worldwide Inc.

For the story, see Memphis man gets 17 years for bilking churches.

For earlier post, see Trial Begins For "Sovereign Citizen" Accused In F'closure Rescue, Loan Reduction Scam; Judge Rejects "Diplomatic Immunity/Moor Defense" As "Gibberish".

For the details of the criminal charges, see U.S. v. McKuhn.

Go here for other posts on rackets involving so-called sovereign claims.