Virginia AG Continues Use Of Civil Suit Settlements To Prosecute Blatant Loan Modification Ripoffs

From the Office of the Virginia Attorney General:

• Attorney General Ken Cuccinelli announced [] that his office has reached settlements with two affiliated mortgage loan modification companies for allegedly charging illegal advance fees before performing "foreclosure rescue" services for their customers, and failing to follow through on promises to deliver those services.
  
  The attorney general alleged that Virginia Beach-based Rysnglo Financial Management, LLC, and Los Angeles-based Mae Global Enterprises, LLC violated the Virginia Foreclosure Rescue law by charging and receiving large advance fees from consumers in connection with services to prevent foreclosure. Virginia law prohibits a supplier of foreclosure avoidance or prevention services from charging or receiving a fee prior to the full performance of the services it has agreed to perform, if the transaction does not involve the sale or transfer of residential real property.
  
  According to the attorney general's complaint, consumers typically contracted directly with Mae Global, but paid money to Rysnglo. Rysnglo would provide portions of the fees it received to Mae Global, which was supposed to provide the services. The companies charged consumers fees ranging from $6,000 to $15,000 to help them obtain mortgage loan modifications.
  
  In another service offered, consumers could supposedly purchase their home, free and clear of their mortgage, for a fraction of the outstanding balance of their mortgage. At least one consumer allegedly paid $80,000 for this service.

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• The settlements include the following key terms:
  
  The commonwealth is granted judgments against Rysnglo and Mae Global in amounts totaling $248,200 for restitution to consumers.
  
  The commonwealth is granted judgments against Rysnglo and Mae Global in amounts totaling $85,000 in civil penalties for their alleged violations of the Foreclosure Rescue law and the VCPA.
  
  The commonwealth is granted judgments against Rysnglo and Mae Global in amounts totaling $25,000 for reimbursement of attorneys' fees and costs.

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• "I am unaware of a single instance where consumers received promised services from the Rysnglo or Mae Global,"(1) Cuccinelli said. "My office is committed to pursuing those who prey on Virginia citizens experiencing financial difficulties."

For the Virginia AG press release, see Cuccinelli announces settlements with Virginia Beach, L.A.-based mortgage loan modification companies (Commonwealth will obtain $358,000 in judgments for customer restitution, civil penalties, and attorneys' fees).

(1) If this is true, one wonders why a criminal prosecution (ie. grand theft, theft by deception, etc.) wouldn't have been more appropriate.