Ariz. AG alleges mortgage payment scheme
PHOENIX (Legal Newsline) - Arizona Attorney General Tom Horne filed a lawsuit on Friday against a woman who allegedly defrauded homeowners seeking aid in obtaining mortgage modifications to save their homes from foreclosure.
Rosa Galope allegedly charged thousands of dollars in advance fees for foreclosure rescue and mortgage loan modification services that she later claimed were donations to her church, Nation to Nation Ministries. Galope also allegedly prohibited her clients from communicating with their lenders, telling them to send her any payments meant for the lenders.
Instead of forwarding the homeowners' payments to the lenders, Galope allegedly kept the funds for her own use, endorsing checks made payable to lenders and cashing them at a check cashing store.
"The economic crisis has created a number of vulnerable consumers who are often targeted for predatory schemes like this," Horne said. "It is unfortunate that these types of scams victimize people who are already in distress, and who unfortunately place their trust in the wrong person. My office is dedicated to vigorously prosecuting these cases to alert predators that their actions will not go unpunished."
When Galope was unsuccessful in helping homeowners to get a modification, she allegedly convinced them to give her thousands of dollars more that she claimed she would use as a down payment for homeowners to repurchase their homes from an investor. The investor would purchase the house at a substantial discount and sell it back to the homeowner for less than the current mortgage. Galope allegedly kept the down payment money and failed to refund it to homeowners when the investor deal failed to materialize.
Horne is asking the court to prohibit Galope from further engaging in deceptive and unlawful practices connected to foreclosure rescue and mortgage modification activities. In addition, the lawsuit seeks full restitution for consumers allegedly harmed by Galope and for civil penalties, fees and costs to Horne's office.