Tuesday, December 27, 2011

Suspected Illegal Loan Mod Racket Continues To Operate Unabated Despite State Cease & Desist Order, Ongoing State Bar Probe

In Bakersfield, California, KGET-TV Channel 17 reports:

  • More than a half dozen homeowners turned to 17 News for help.They say a man promised to modify their mortgages but instead swindled them out of thousands of dollars. nd, they're frustrated that man is still in business. Charlie Yong wasn't happy to see us.

  • The Department of Real Estate has ordered him to stop offering loan modification assistance because he's not a lawyer and not a real estate broker.(1) And, they say that means he's breaking the law. But, so far, for Yong, it's business as usual.


  • Here's how [one victim] says it worked: Yong told perspective clients he represented an attorney named Travis Jack who would perform their loan modification. Salas says Yong asked for an upfront fee, about $2,500, for his services. [... He] says Yong told him the mortgage company wanted his money placed in a separate holding account: a sign of good faith he would continue to make on-time mortgage payments. Instead, [he] says Yong simply kept the money.


  • We found attorney Travis Jack works across the hallway from Yong in the same office space. He didn't want to be interviewed on camera, but Jack told us off camera he did about 80 home loan modifications with Yong and was paid about $6,500, far less than he was promised.

  • Now, he is under investigation by the State Bar Association, and he has been sued by several clients. In fact, a check of state records shows the bar suspended Jack's license for a year in May 2010.(2) As part of the hearing, Jack admitted he and Yong took $500 from a woman and promised to help modify her home loan. But, the woman's bank sold her home through foreclosure four days later. And, it was a full two weeks after the sale before one of Yong's employees even made the first attempt to try to stop the sale.

  • The bar says in so doing, Jack violated professional rules by refusing to refund the woman's money. And, they say Jack assisted Yong in the unauthorized practice of law.

For more, see 17 News Investigation: homeowners say they were scammed.

(1) DRE Yong Order to Desist and Refrain.

(2) Jack State Bar Suspension.

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