FTC Crackdown

The Federal Trade Commission announced several new developments in its crackdown on fraudulent loan modification and foreclosure relief companies. One settlement order bans 16 marketers from the mortgage modification or foreclosure relief business, another requires payment of $11.4 million for violating a previous court order the FTC obtained against the same scammer for fraudulent telemarketing practices, and a new FTC lawsuit charges another online marketing operation with masquerading as a government mortgage assistance program.


The FTC is focusing on companies that charge consumers up-front fees and made false promises that they could get their loans modified or prevent foreclosure.

Some highlights include:

- Impersonation of MakingHomeAffordable.gov

- “Federal Loan Modification Law Center,” charging largely upfront fees of as much as $3k but not delivering services

- False claims of being able to obtain mortgage loan modifications for consumers in all or virtually all cases, false “money-back guarantees,” and false statements of affiliation with HOPE NOW

- Misleading “official government agency seals” or logos and links to federal government Web sites

For more detailed information, and copies of the court filings, please see:


http://www.ftc.gov/opa/2010/06/loanmods.shtm