INDIANAPOLIS (Legal Newsline) - Indiana Attorney General Greg Zoeller announced on Thursday that more than 70 victims of foreclosure rescue fraud will receive payments totaling $60,000 from the newly created Consumer Protection Assistance Fund.

Thirty-two Marion County consumers will receive $20,442 in compensation from the fund to help recover their combined financial losses of approximately $73,961.

"This important fund provides some relief for consumers who assist my office to bring legal actions against businesses that prey on consumers' who are financially vulnerable as well as helping warn others to avoid these scams," Zoeller said. "Our office is appreciative of our state lawmakers' efforts to create the CPAF to give victims who are facing difficult times the means to recover some or all of their losses."

During the foreclosure crisis, many homeowners were victimized by deceptive credit services and home loan practices or through foreclosure rescue fraud, Zoeller says. Many consumers then filed complaints with Zoeller's office. Default judgments against companies do not typically result in the victims receiving any payments for their financial losses. To help those who reported these types of violators to the state, the 2011 Indiana General Assembly passed legislation that created the CPAF.

To save taxpayer dollars, legislators allowed the monies to originate from funds that were recovered from companies Zoeller sued for violating consumer protection laws.

The CPAF was modeled after a restitution fund that paid more than $125,000 to Indiana victims of American Escrow, a company based out of Chicago that allegedly failed to pay more than $1 million in property taxes collected from homeowners.

On Wednesday, Zoeller's office filed lawsuits against Mortgage Home Start Services of California and Litigation Law Group of Florida. The lawsuits allege that both foreclosure consultant companies collected money up front and failed to provide refunds to customers after the services were not provided.

The lawsuits allege that both organizations violated the Mortgage Rescue Protection Act, the Credit Services Organization Act, the Deceptive Consumer Sales Act and the Home Loan Practices Act. Home Start Services and Mortgage Litigation Law Group also allegedly failed to obtain certificates of authority from the Indiana secretary of state's office to conduct business in the state of Indiana.

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