Finance Globe
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Bogus Foreclosure Prevention Company Halted by Federal Court
A bogus mortgage foreclosure prevention operation has been charged with violating the FTC Act by fraudulently claiming they could prevent foreclosure.
The fake company not only failed to deliver on their promises and refused to deliver the guaranteed refund to troubled homeowners, but also misrepresented the earnings potential of a "loss mitigation consultant" business opportunity that they sold.
The business activities of Arizona-based Freedom Foreclosure Prevention Services, LLC, Loss Mitigation Training Center of America, LLC, Jeffrey C. Segal, and Michael R. Workman have been halted by a federal court at the request of the Federal Trade Commission.
According to the FTC's complaint, Freedom Foreclosure Prevention falsely claimed that they could prevent 97% of foreclosures, and misrepresented to homeowners that they would give a full refund if they failed to do so. Before the company provided any loss mitigation services, they required the homeowner to pay them the equivalent of one month's mortgage payment. Homeowners were instructed not to contact their mortgage company - the contract stated that if the homeowner did, their contract and money-back guarantee would be voided.
Some homeowners were even told to stop making regular mortgage payments while Freedom Foreclosure Prevention worked on their case. The FTC alleges that the company only completed loan modification for about 6% of the cases they took on, and the company routinely failed to return repeated phone calls from their customers.
In numerous cases the fraudulent business never contacted the mortgage lender on behalf of the consumer or only made non-substantive contact with the lender - resulting in late fees, penalties, and other costs for homeowners.
The FTC also alleges that the deceptive company sold a "loss mitigation consultant" business opportunity for up to $1500, falsely claiming that purchasers - who were to become "consultants" - could earn up to $6000 a week by referring homeowners to them and by recruiting new consultants. In fact, no consultant has ever earned that much money through this "business opportunity."
The FTC is the nation's consumer protection agency against fraudulent, deceptive, and unfair business practices. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP.
Source:
Federal Trade Commission
The fake company not only failed to deliver on their promises and refused to deliver the guaranteed refund to troubled homeowners, but also misrepresented the earnings potential of a "loss mitigation consultant" business opportunity that they sold.
The business activities of Arizona-based Freedom Foreclosure Prevention Services, LLC, Loss Mitigation Training Center of America, LLC, Jeffrey C. Segal, and Michael R. Workman have been halted by a federal court at the request of the Federal Trade Commission.
According to the FTC's complaint, Freedom Foreclosure Prevention falsely claimed that they could prevent 97% of foreclosures, and misrepresented to homeowners that they would give a full refund if they failed to do so. Before the company provided any loss mitigation services, they required the homeowner to pay them the equivalent of one month's mortgage payment. Homeowners were instructed not to contact their mortgage company - the contract stated that if the homeowner did, their contract and money-back guarantee would be voided.
Some homeowners were even told to stop making regular mortgage payments while Freedom Foreclosure Prevention worked on their case. The FTC alleges that the company only completed loan modification for about 6% of the cases they took on, and the company routinely failed to return repeated phone calls from their customers.
In numerous cases the fraudulent business never contacted the mortgage lender on behalf of the consumer or only made non-substantive contact with the lender - resulting in late fees, penalties, and other costs for homeowners.
The FTC also alleges that the deceptive company sold a "loss mitigation consultant" business opportunity for up to $1500, falsely claiming that purchasers - who were to become "consultants" - could earn up to $6000 a week by referring homeowners to them and by recruiting new consultants. In fact, no consultant has ever earned that much money through this "business opportunity."
The FTC is the nation's consumer protection agency against fraudulent, deceptive, and unfair business practices. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP.
Source:
Federal Trade Commission
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