AG Coakley has businesses pay nearly 400K; sues 19 allegedly involved in mortgage fraud

John O'Brien Apr. 16, 2007, 3:00pm


BOSTON - Two companies recently acknowledged to Massachusetts Attorney General Martha Coakley their obligation to pay overtime wages to their employees and will dole out a substantial amount to prove it.

Stacy's Pita Chips, a snack-food manufacturer, and Optimum Corporation, Inc., a temporary employment agency, will be equally responsible for paying $374,153 to 380 affected employees who claimed they were not paid overtime wages.

The companies will also pay $25,000 in penalties to Coakley, she announced Thursday.

Coakley said both companies operated fully with her investigation, and that the amount agreed upon completes full restitution.

Massachusetts law says that a worker must be paid "time-and-a-half" wage for work performed in excess of 40 hours in a week.

Wednesday, Coakley filed motions for preliminary injunctions against 19 defendants she alleges were involved in mortgage fraud and foreclosure rescue schemes. They are the same 19 she named in a lawsuit filed March 30.

Coakley said she is trying to uncover predatory conduct in mortgage brokering and lending.
"These defendants, many of whom were professionals, preyed on vulnerable homeowners facing foreclosure to deceive them out of their home and their life savings," Coakley said. "With the number of foreclosures increasing daily, this type of mortgage fraud is particularly troubling and we will take aggressive action to ensure that this predatory conduct does not continue in Massachusetts."

Coakley said the foreclosure rescue scheme targeted desperate homeowners facing foreclosure. Each defendant, she said, conspired to deceive the homeowner into selling his or her home under the false promise of avoiding foreclosure and maintaining the home.

The defendants, though, obtained the title and stripped most of the home's equity through inflated mortgages, false fees for fictitious services and false certifications by closing attorneys, she says.

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