Crackdown on Fraudulent Loan Modifications

Allison Tussey —  October 8, 2010 — Leave a comment

The Law Offices of Stephen L. Burns is prohibited from doing any future loan modification work in the State of Oregon. After Burns withdrew $1,500 from the bank account of an Oregon client to assist with a loan modification he never tried to arrange, the Oregon Department of Justice’s Mortgage Fraud Task Force launched an investigation. Burns was cooperative after being contacted by the Department of Justice and agreed to settle the complaint.

The settlement filed in Clatsop County Circuit Court requires Burns to repay $1,500 to the Oregon victim and $4,500 to the Oregon Department of Justice to support its continued efforts on behalf of Oregon consumers. In addition, Burns must permanently cease performing any foreclosure or loan modification activities in the state.

Attorney General John Kroger today announced the settlement with Burns.

“This office is committed to protecting Oregon homeowners from mortgage and foreclosure fraud,” said Deputy Attorney General Mary Williams.

Fighting mortgage fraud is a major priority for Attorney General Kroger. Before Kroger took office in January 2009, the Department of Justice had no attorneys dedicated to combating mortgage rescue fraud.

Last year the Oregon Department of Justice won a competitive federal grant to fund an aggressive program dedicated to fighting mortgage and foreclosure fraud. Since its inception, the Mortgage Fraud Task Force has launched more than 80 investigations – both criminal and civil – settled more than a dozen mortgage-related cases, and recovered more than $1.6 million to benefit Oregon consumers.

Today’s agreement is part of a concerted effort by the Oregon Department of Justice and the Oregon Department of Consumer and Business Services to protect Oregonians from widespread mortgage rescue fraud and abuses that have materialized in the present economic downturn.

Mortgage rescue fraud is a continuing problem that Oregonians can avoid. Consumers should be aware that charging advance fees for loan modification and foreclosure consulting work is generally illegal in Oregon and consumers should always verify that a company is properly registered with the Department of Consumer and Business Services Division of Finance and Corporate Securities.

For help with a loan modification problem, contact the Attorney General’s Consumer Hotline by phone (1-877-877-9392) or visit: www.doj.state.or.us. To verify whether a loan modifier is properly registered, check with the Department of Consumer and Business Services Division of Finance and Corporate Securities at www. dfcs.oregon.gov or call 1-866-814-9710.

Oregonians can also call 1-800-SAFENET to find a nonprofit foreclosure consultant who will provide help at no charge.

Assistant Attorneys General Tom Elden and Harry Wilson handled the case for the Mortgage Fraud Task Force.

Attorney General John Kroger leads the Oregon Department of Justice. The Department’s mission is to fight crime and fraud, protect the environment, improve child welfare, promote a positive business climate, and defend the rights of all Oregonians.

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Allison Tussey

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