Lack Of Resources, Capabilities, Knowledge Or Manpower Doesn't Stop Some Operators From Pocketing Upfront Fees For Bogus Loan Modification Services

ABC News reports:

• The housing crisis has left millions of homeowners desperately trying to avoid foreclosure, but their plight is only made worse by schemers who promise help but instead seek only to scam. Now the Obama administration is highlighting its multi-agency effort to stop these scams.

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• One such company targeted by authorities is Nation's Housing Modification Center,(1) a California loan modification company that had civil charges filed against it Wednesday. The company was the subject of a recent ABC News investigation. Former employees of the company told ABC News that it was little more than a "boiler room" operation filled with telemarketers reading from a special script targeted at anxious homeowners facing foreclosure. "They're convincing people to give money to them in advance, promising to do something that they're not doing, that they don't even have the resources, capabilities, knowledge or manpower to do," said former employee Tom Fatica, who said he was fired from NHMC after he questioned the absence of the attorneys and accountants who were supposed to help homeowners.

• Civil charges were also filed against another California company, Infinity Group Services of Orange County.(2)

For more, see Fighting Mortgage Scams: Governments Team Up (State and Federal Officials Try to Stop Scammers Who Prey on Those Facing Foreclosure).

For the FTC press release announcing the two recent lawsuits against these loan modification outfits, and updates on previous suits filed against other firms, see FTC Announces New Enforcement Actions In Continuing Crackdown On Mortgage Relief Services Scams.

(1) For the lawsuit, see FTC v. Federal Housing Modification Department, Inc. (doing business as Nations Housing Modification Center and Loan Modification Reform Association; other defendants: Michael A. Trap, Glenn Rosofsky, and Bryan Rosenberg).

(2) For the lawsuit, see FTC v. Infinity Group Services (d/b/a IGS, Hope to Homeowners, ASKIGS, and ASKIGS, Inc.; other defendants: Kahrami Zamani, individually and as an officer of Infinity Group Services).