Wednesday, May 23, 2012

Arizona AG: Loan Modification Racket Used Multiple Ruses To Pocket Upfront Cash From Homeowners; Claimed Fees Were 'Church Donations'

From the Office of the Arizona Attorney General:

  • Attorney General Tom Horne announced [] that a complaint has been filed in Maricopa County Superior Court against Rosa Galope, of Surprise and Avondale, Arizona, alleging that she defrauded homeowners looking for help in obtaining mortgage modifications and saving their homes from foreclosure.
  • The lawsuit alleges that Galope charged thousands of dollars in advance fees for mortgage loan modification and foreclosure rescue services that she later falsely claimed were donations to her church, Nation to Nation Ministries.

  • The lawsuit also alleges that Galope prohibited her clients from communicating with their lenders and told them to send her any payments that they intended to go to their lenders, and that Galope would forward the payments to the lender.

  • The lawsuit alleges that rather than forwarding homeowners' payments to their lenders, Galope kept the funds for her own use, even endorsing checks made payable to lenders and cashing them at a local check cashing store.

  • The lawsuit further alleges that when Galope was unsuccessful in helping homeowners get a modification. She convinced them to give her thousands of dollars more, money that Galope said would be used as a down payment for the homeowners to repurchase their homes from an investor. [...] The lawsuit alleges that Galope kept the down payment money for herself and failed to refund it to homeowners when no investor deal occurred.
For the Arizona AG press release, see Horne Files Complaint In Mortgage Fraud Scam.

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