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.

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• 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.