Cuomo to sue Amerimod loan modification company

Keith Loria Jun. 10, 2009, 10:58am

Andrew Cuomo (D)

NEW YORK (Legal Newsline) -Attorney General Andrew Cuomo said office is preparing a suit on a leading New York foreclosure rescue company for charging illegal up-front fees and engaging in consumer fraud.

On Tuesday, the attorney general's office served a notice of intent to sue Uniondale, N.Y.-based American Modification Agency, Inc. ("Amerimod") and its owner and president Salvatore Pane, Jr., for allegedly charging illegal up-front fees and using deceptive marketing to target homeowners facing foreclosure, and not delivering on its promises.

"This economic climate has bred an environment in which scam artists and opportunists are able to prey on vulnerable consumers on the brink of losing their most valuable possession-their home," said the Democratic AG. "Companies that charge homeowners up front fees for loan modification services, put homeowners into contracts that don't disclose cancellation rights, or lure consumers with misleading claims violate not only our trust but the law. Today's notice and the subpoenas issued nationwide are part of my Office's multi-tiered effort to stamp out this kind of abuse and protect homeowners across the country."

Cuomo's Office also has also served subpoenas on fourteen other companies in New York and across the country that offer loan modification services as part of the attorney general's on-going investigation into the so-called "foreclosure rescue" industry.

Those companies are: American Home Recovery Corporation; CloseMore Financial Corporation; Elite Results Group, Inc.; FLM Law Center LLP, a/k/a Federal Loan Modification Law Center and Federal Loan Modification; Hometown U.S.A., Inc.; Global Modification Services, Inc. a.k.a Law Office of Brian Margolin, P.C.; Loan Modification Affiliate Exchange, Ltd, a/k/a LoanMAE; Nationwide Modification Agency, Inc.; NMA Legal Services, P.C.; Northeast Mortgage Services; People's First Financial, Inc.; Raymond Lewis & Fitch, Inc.; Settled For Less, Inc.; and the Law Depot, Inc. a/k/a the Loss Mitigation Legal Network.

Allegedly, these companies promise that they will negotiate with the consumers' banks to lower mortgage interest rates, lock in fixed rates, get late fees and past due payments forgiven, and even reduce principal balances, but for the most part fail to deliver as promised and often leave the customers further in debt.

The subpoenas include requests designed to uncover, among other information, the companies' marketing strategies, representations made to customers regarding the services the companies provide and their success rates, fee structures, whether contracts are provided in accordance with the law, and what, if any, services are actually performed.

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