Brown Wins $1 Million in Restitution for Victims of Attorney-Backed Foreclosure Rescue Scam

There are good business models and bad business models.  It is not automatically true that a large scale operation is running after the money rather than service for you, but be sure to check out their references. Many if not most of  these scam operations are being chased off the market with full support of the banking industry. It seems that even though the operations are less than upscale, they nevertheless delayed the foreclosure process and cost the pretender lenders money. Or check them out here with a posting and see what response you get.
2010/08/24 at 1:28 pm submitted by ABBY

CALIFORNIA ATTORNEY GENERAL BROWN NAILS THEM AGAIN!!!!

Brown Wins $1 Million in Restitution for Victims of Attorney-Backed Foreclosure Rescue Scam

LOS ANGELES – Attorney General Edmund G. Brown Jr. today announced a $1.1 million judgment against longtime Los Angeles attorney Mitchell Roth after he conned 2,000 desperate homeowners into paying him thousands of dollars to file “frivolous and phony” lawsuits that didn’t reduce a penny of mortgage debt for a single client.

“Roth promised foreclosure relief through aggressive litigation, but the frivolous and phony lawsuits he filed instead left 2,000 desperate homeowners in even greater debt,” Brown said. “This settlement forces Roth to pay $1.1 million and prohibits him from ever again preying on new victims.”

In 2008, Roth, a seasoned Los Angeles attorney, joined with Nevada-based United First, Inc. and the company’s owner, Paul Noe, to provide foreclosure relief services to homeowners struggling to pay their mortgages. Noe, who was previously convicted of wire fraud and the subject of a 2004 Department of Insurance Cease and Desist Order, operated the company and handled client solicitations, while Roth provided legal services.

Homeowners were told that if they worked with United First and hired Roth to pursue their cases in court, they could lower or eliminate their mortgage debt and save their homes.

United First charged homeowners some $1,800 in up-front fees, plus at least $1,250 each month, and 50 percent of the cash value of any settlement. If a homeowner’s debt was eliminated altogether, the homeowner was required to pay United First 80 percent of the value of the home.

After collecting up-front fees, Roth filed lawsuits on behalf of homeowners, pushing a novel legal argument that a borrower’s loan could be deemed invalid because the mortgages had been sold so many times on Wall Street that the lender could not demonstrate who owned it.

Once the lawsuit was filed, Roth did next to nothing to advance the case and often failed to make required court filings, respond to legal motions, comply with court deadlines or appear at court hearings. Instead, Roth tried to extend the lawsuits as long as possible to collect additional monthly fees from clients.

This approach did not generate a single victory in court and did not lower or eliminate the mortgage debt for a single one of the 2,000 homeowners who hired Roth and United First.

Brown filed suit last July, alleging that Roth, Noe and United First engaged in unfair competition, made untrue and misleading statements and violated California’s credit counseling and foreclosure consultant laws.

The settlement announced today requires Roth to pay $1 million in restitution to defrauded homeowners plus $125,000 in penalties, and prohibits him from ever engaging in similar conduct in the future.

Roth was admitted to the California State Bar in 1977 and resigned in April 2009, after the State Bar ordered his law firm closed.

Brown’s office continues to litigate the case against Noe and United First.

Homeowners who were defrauded by Roth and United First, or victimized by any other foreclosure rescue scam, should contact Brown’s office at 1-800-952-5225 or file a complaint online at: http://www.ag.ca.gov/consumers/general.php

.

Homeowners can also file a complaint against a lawyer, a legal specialist or a company purporting to operate as a law firm with the State Bar by calling 1-800-843-9053 or visiting http://www.calbar.ca.gov

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United First customers who are eligible for a refund will be contacted by mail.

By law, all individuals and businesses offering mortgage-foreclosure consulting, loan modification and foreclosure-assistance services must register with Brown’s office and post a $100,000 bond. It is also illegal for loan modification consultants and businesses to charge up-front fees for their services.

Non-profit housing counselors certified by the U.S. Department of Housing and Urban Development provide free help to homeowners. To find a counselor in your area, call 1-800-569-4287.

Brown has sought court orders to shut down more than 30 fraudulent foreclosure-relief companies and has brought criminal charges and obtained lengthy prison sentences for dozens of deceptive loan modification consultants.

For more information on Brown’s action against loan modification fraud visit: http://ag.ca.gov/loanmod

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Copies of Brown’s original complaint, filed in Los Angeles County Superior Court, and the settlement announced today are attached.
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You may view the full account of this posting, including possible attachments, in the News & Alerts section of our website at: http://ag.ca.gov/newsalerts/release.php?id=1979

13 Responses

  1. I have paid United Law Center $2700.00 up front fee and $600 a month. They promised me that they will help me with my home modification. If the modification does not work then they will pursuit for lawsuit. Now they are telling to file for bankruptcy and I don’t want to file for bankruptcy. I am going to lose my house. Any body have any suggestion or idea what I should do?

  2. Let’s see that clown win $1 trillion dollars for the victims of the ATTORNEY BACKED FORECLOSURE SCAM. Then I might be imprest everything else is just campaign glamor, don’t let it fool you.

  3. Well, if the terms were actually as stated in the article:

    “United First charged homeowners some $1,800 in up-front fees, plus at least $1,250 each month, and 50 percent of the cash value of any settlement. If a homeowner’s debt was eliminated altogether, the homeowner was required to pay United First 80 percent of the value of the home.”

    ….then maybe it’s best that they did get shut down! I mean, $1,800 up front, plus “at least” $1,250 per month, plus 50% of any settlement, plus 80% of the value of the home…..lol….might as well just pay it off!

    And if the lawsuits were indeed frivolous, i.e., did not have the strategies presented on this blog, they can certainly cause more harm to the borrower in having to pay legal fees to the other party…..over and above the fees paid to Roth & Co. But the article states that Roth may have raised the issue of the sale of the Note to the Wall Street (securitization) parties. However, it also states that Roth did next to nothing to push the lawsuits once filed. That’s a big no-no. Gotta keep up on them.

    I do agree that the California Attorney General could use his office more judiciously. There must be ways we can “compel” our states’ AGs or Governors to uphold the law.

  4. Anyone in the Sacramento area that can help please. I need an attorney to help with a moton to dismiss. The attorney that I have sent nearly $15000 has changed all phone numbers and wont answer any emails. I am to be in court Sept. 2. I need some one who gets it.

  5. With all the bogus “trustee services companies” that have been set up in CA who are literally stealing people’s homes you would think the AG would spend a little more time on that or perhaps an initiative that would change CA to a judicial foreclosure state so that a pesky little constitutional requirement called “due process” might be served….perhaps in that environment Mr. Roth may have actually been successful in his pursuit of justice for some of those 2000 homeowners….

    As has been opined here for sometime, there was a massive fraud on the marketplace. The powers to be(Gov’t) know this but unfortunately can’t admit it because who do you think all those fraudulent AAA mortgage backed securitiesn were sold to….your pension fund.

  6. Karen Pooley,
    For every problem … there is a solution! How can we help? What are your options?

  7. This sounds eerily familiar!

    “Roth filed lawsuits on behalf of homeowners, pushing a novel legal argument that a borrower’s loan could be deemed invalid because the mortgages had been sold so many times on Wall Street that the lender could not demonstrate who owned it……This approach did not generate a single victory in court and did not lower or eliminate the mortgage debt for a single one of the 2,000 homeowners….”

    When are homeowner’s and their lawyers going to realize the ONLY method that works is to find contract violations and/or tortious conduct to use against the agents of the banks!

  8. He doesn’t go after the fraudsters who are stealing people’s homes. Plain and simple.

  9. @angry and not taking it
    Believe me, as a foreclosure victim getting re-victimized by an unscrupulous attorney….they need to fight fraud wherever they find it.

  10. I should talk to my Attorney General’s office about Jeff Barnes, Foreclosure Defense Nationwide. Talk about taking the money and running!

    Karen
    206-396-4486

  11. BY DOING THIS ALOT OF LEGITIMATE ATTORNEYS WILL BE AFRAID TO DEFEND US

    ARMAGEDON

  12. By doing this alot of attorneys will be afraid to defend us.

    ARMAGEDON

  13. In the most abused non judicial foreclosure state , This is what Mr BROWN chases?? Must be an election coming up.. “I cant hear you MR FUNG!!!!!”

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