Fraud & Settlements

Well, there are a pair of items to discuss today, and while they don't specifically link to each other, the subject matter seems appropriate to cover simultaneously. First, we'll discuss fraud. In this case, it's NOT fraud by a lending institution trying to take away your home in some egregious manner. No, here it's a case of someone claiming to be a "housing counselor", someone who claimed she would be able to help the suffering homeowner avoid the devastation of losing a home to foreclosure. What she actually did was to take up front fees from troubled homeowners, guarantee she'd help them avoid foreclosure, often by getting a loan modification, and then in actual fact use the funds lifted from victimized homeowners' wallets to both pay her own mortgage and cover her gambling debts. The gambling debts were apparently fairly substantial. When all was said and done, she'd burned through nearly $300 grand of her unsuspecting clients' money and about $2,000 of Federal grants obtained through the Buffalo Urban Renewal Agency. The results: well, according to authorities quoted at her sentencing, "some" ,no number was mentioned, of her 136 clients' homes were lost to foreclosure due at least in part to her actions. If there is any good from this story, it's the fact that she now has the next six years in a much smaller residence with bars on the windows (no mortgage, though) to contemplate her nefarious deeds. After she gets out, she also has three years court supervision to oversee her court ordered restitution of $298,639 to her clients.
A lesson from this? If you're in trouble with your mortgage and the person you consult to 'help' you requests an up front fee and/or 'guarantees' they'll be able to help you avoid foreclosure, run....AWAY FAST! The only thing they'll be saving is your money that you paid as a fee --in their bank account. If they claim this is normal, ask for references , check the Better Business Bureau, call your lender to see f the 'consultant' is known to them, and call the police to see if the consultant has a record for doing this (not the record he or she wants you to see). While I'm at it, if this situation seems to fit anything you've been subjected to over the last few years, you may want to check with the authorities. This perp is named Lori J. Macakanja.

Okay! Now for the second item: Settlement.The much trumpeted nationwide state by state settlement with most of the country's major servicers and lenders was to be settled and signed by last night. So far, there isn't any final figure on exactly how many states actually jumped on the bandwagon. However, best estimates are that about 40 of the 50 states joined in and their attys. general had signed. New York and California were among the conspicuous absentees, both stating that they didn't feel the financial institutions were being punished enough for their actions by the terms of the settlement. There has been some discussion that either or both may join in later after further negotiation, but that is speculative for now. Final details: keep your eyes peeled in the press, the broadcast media or HERE!
As always, good luck.