Seven modification companies cited for fraud in N.J.

Bryan Cohen Aug. 2, 2011, 2:31pm


NEWARK, N.J. (Legal Newsline) - New Jersey Attorney General Paula Dow and the State Division of Consumer Affairs announced administrative actions Tuesday against seven mortgage modification service companies for alleged fraud.

The seven businesses include Dunwell Financial Services LLC of Jersey City, N.J.; Home Mitigation Group of Matawan, N.J.; Loss Mitigation Consultant Services of Paulsboro, N.J.; Rose MM LLC of Newark, N.J.; Save Americas Mortgage Corp. of Fort Lee, N.J.; TWI Corp. of Winter Garden, Fla.; and Continental Associates Ltd. of Commack, N.Y. The companies were served with a notice of violation.

The call for the companies, cited for violating the state's Debt Adjustment and Credit Counseling Act and Consumer Fraud Act, to cease and desist offering debt adjustment services. The companies have the option of contesting the notices and requesting a hearing.

"We do not want homeowners who are already struggling to make mortgage payments victimized by unlicensed persons offering services that they cannot lawfully provide," Dow said. "Unlicensed companies most often make a difficult situation worse for homeowners, and we will continue to go after these firms."

The companies allegedly offered mortgage loan modification services even though they were not licensed as debt adjusters by the Department of Banking and Insurance. Dow is seeking $35,000 in civil penalties and $49,434 in consumer restitution from the companies. The amounts sought in consumer restitution represent the fees paid by approximately 10 consumers for mortgage loan modification services.

"Since the division began this initiative earlier this year, we have taken action against 18 unlawful mortgage modification outfits," Thomas Calcagni, the director of the DCA, said. "So long as illegal mortgage modification businesses continue to ignore our laws and take advantage of financially-strapped New Jersey homeowners, we will continue to hold those businesses and their principals accountable. Our aggressive enforcement of these illegal enterprises continues."

The DCA created its Financial Fraud Unit to focus on mortgage-related frauds that prey on struggling homeowners. The division has recovered over $2.2 million in actual restitution for New Jersey homeowners who were victimized by predatory mortgage practices and mortgage-related scams.

The only businesses in the state that can engage in mortgage loan modification services are nonprofit organizations licensed by the DBI, the lender or the owner of the loan, an attorney, provided he or she is not primarily engaged in debt adjustment, and the mortgage servicer acting on the lender or owner's behalf.

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