Foreclosure Crisis: Foreclosure Rescue Firm Charged For Scam

September 18th, 2007

The court has frozen the assets of Foreclosure Assistance Solutions after the Attorney General of Texas, Abbot, charged this company of fraud. It predated on unfortunate victims of foreclosure. The 408^th District Court issued temporary restraining orders freezing the assets of three organizers of this plan. The defendants had wrongly advertised that they would be able to save the victims from foreclosures. This order is to be taken as an exemplary one – as a warning to other prowling wolves. Attorney General Abbott has cautioned house owners who are having trouble to be wary of help offers. The lender should be contacted directed.

The accused have been charged for mailing cards and letters promising the sky. They had said that contact would be established with mortgage companies and banks across the country as a result of which foreclosures would come to an abrupt halt. The victims were asked to quickly sign a $1,200 contract that clearly stated that the borrower would on no account contact the lender. After the fees were paid the ‘rescuers’ disappeared. Repeated calls were ignored. It caused further damage by wastage of time and consequently, foreclosure became inevitable.

The current court order bans making of false representation and prohibits specifically the making of a claim that the home is at risk without providing proper documents. No assistance is to be offered without detailing the nature of the help.

According to findings by the office of the Attorney General the accused company had deposited more than $13 million in Bank of America from 2005 to 2006 taken mostly from gullible house owners. The court further orders restitution for house owners who had suffered together with maximum penalties of $20,000 for violation of Texan laws as regard deceptive trade practices. An additional fine of $5,000 has been clamped down for the accused failing to register the business as the type that conducts work over the telephone.

The Attorney General’s office is knee deep in work related to residential mortgages having forayed into a partnership with a task force related to tracking scammers and taking action. Earlier this year Abbott got $21 million in restitution for house owners of the state who had been badly mauled by Ameriquest Mortgage Company – one of the giants in the field. The company had not clearly outlined terms of the loan to the borrowers – especially those relating to adjustable mortgage rates.