Milgram: Foreclosure rescue schemes nothing but fraud

John O'Brien Oct. 20, 2008, 5:44pm


TRENTON, N.J. (Legal Newsline) - New Jersey Attorney General Anne Milgram has filed a pair of lawsuits, alleging fraud and racketeering on the part of 37 defendants associated with the mortgage loan industry.

Milgram says the defendants used predatory foreclosure rescue schemes to convince homeowners to sign over their homes, obtained at least $13.5 million in fraudulent loans and stole at least $3 million in homeowner equity.

"The conduct charged in these lawsuits is unconscionable. These defendants preyed on people who were facing foreclosure and searching for a lifeline that would enable them to get back on their feet and remain in their homes," said Milgram, whose office filed the suits Wednesday.

"Having placed their hope and trust in these defendants, victims ended up far worse off than they were before. It is critical that we root out this kind of fraud and protect consumers who go seeking help from finding complete financial ruin instead."

The defendants participated in a scheme to persuade homeowners to turn their homes over to third-party buyers as part of a "sale/lease-back" transaction, Milgram said. Instead, the defendants collect most of the proceeds for themselves and stripped the homes of their equity value, she said.

Paying rent or re-establishing credit became tougher for the victims, some of whom have been evicted, Milgram said. The defendants continue to collect rent in some instances but do not apply the payments to the mortgage, leaving the homes in foreclosure, she said.

The defendants named in the suit range from mortgage loan providers to lawyers. Five defendants are named in both complaints.

Defendants in one action are: Vest Financial, formerly of Paramus; Metropolitan Mortgage Services, Inc., of Cliffside Park; Alex Armani of Cliffside Park; Sohrab Moussavian of Englewood; Anthony Scordo III of West Orange; Felix Nihamin, an attorney who resides in Franklin Lakes and practices in New York City; Francis A. Ciambrone, an attorney with law offices in Paramus; Rhys A. Herrmann, of Belleville; JP Global Property Management LLC of Bloomfield; Peter H. Eckhardt, Jr. of Livingston; Philip Altieri of Flemington; Kristopher Pilone of Manalapan; DBK Realty Investments LLC of Edison; Tom A. Andriopoulos of Washington Township (Bergen County); Settlement Source, LLC of Edison; Vivian M. Ruiz of Hillsdale; and Glen B. Thompson, New York City.

Defendants in the other action are: JP Global Property Management; Jeremy P. Sorvino of Waldwick; Jeffrey M. Malen of Ringwood; Peter Eckhardt, Jr.; Christopher William Eckhardt of Washington Township, (Bergen County); Anthony Scordo III of West Orange; Nihamin; Michael J. Andalaft, an attorney with law offices in Cedar Grove; Capital Hill Mortgage, Inc.; Stanley Capital Mortgage Company, Inc. of Englewood Cliffs; Rhys A. Herrmann of Belleville; Brendan Joseph Flynn of Fort Lee; Maryann E. Sorvino of Ridgewood; Frances B. Benna of Elmwood Park; Vincent F. Latorre of Kenilworth; Jennifer R. Kortman of Livingston; Rebecca A. Kortman of Chatham; William McVeigh of Wharton; Mauricio V. Almeida of Colonia; and Thompson.

The suits are seeking court-imposed penalties, restitution for consumers and injunctions banning the defendant companies from offering foreclosure rescue or credit repair services.

Also, the suits seek to have the records of the defendants impounded and their assets frozen.

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