Mich. mortgage 'rescue' companies accused of taking money and running

Mich. mortgage 'rescue' companies accused of taking money and runningThe Michigan Attorney General filed 19 criminal complaints with 69 allegations against nine mortgage companies and their representatives, saying they illegally charged advanced fees for foreclosure rescue and in turn, defrauded consumers out of thousands of dollars.

The complaint says the companies claimed they would assist consumers in modifying their mortgage, but once they were paid, made meager attempts to actually modify loans. Consumers who paid the fee couldn't get refunds, and many did lose their homes to foreclosure.

All are accused of violating the state's Credit Services Protection Act, which bars companies from charging upfront fees for services yet to be rendered. Others in the lawsuit are accused of using false statements from consumers to secure funds, a felony that could carry a five-year prison sentence. The state also wants to see the defrauded homeowners paid back.

The suit named LCN Mortgage, along with three people working there. One, Benjamin Walcott, is already in jail for violating the Sex Offenders Registration Act.

The attorney general's office lists all the companies and individuals in question on their web site as well as tips for avoiding foreclosure.

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