Attorney General Chris Koster today filed a lawsuit against two related businesses that purported to provide loan modification and mortgage relief to desperate homeowners. Koster’s suit is against Legal Helpers Debt Resolution, LLC and Mortgage Law Group, LLC, as well as the companies’ managing partner, Jason Edward Searns; senior partner, Thomas Macey; and senior partner, Jeffery Aleman.
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The lawsuit alleges that the defendants preyed on vulnerable Missouri consumers who were already dealing with difficult financial circumstances, especially during the economic downturn. The defendants allegedly lured consumers with promises of mortgage modifications or debt settlements, then encouraged them to pay the companies, rather than their creditors. As a result, many consumers defaulted on their obligations and never received the services the defendants promised.
“It is distressing that individuals would take advantage of people who are trying their best to save their homes. Not only did these scammers fail to help their customers, they actually made their financial situation much worse,” Koster said. “My office will seek restitution for the cheated customers, and also work to shut these businesses down to protect other consumers from their fraudulent tactics.”
Specific allegations in the lawsuit state the businesses broke Missouri’s consumer protection laws by:
- Misrepresenting to consumers the results the defendants could achieve and the time necessary to achieve promised results;
- Persuading consumers to stop making payments to their lenders and creditors while failing to inform the consumers of the legal consequences that could result from withholding those payments;
- Taking upfront payments from consumers for debt relief and loan modification services;
- Failing to provide services as promised to consumers;
- Failing to place legally required notifications of consumers’ rights in contracts;
- Misrepresenting that the defendants’ services would be performed by attorneys licensed to practice law in Missouri, and:
- Engaging in the practice of law in Missouri without a license to do so.
Koster noted that consumers can apply to the federal Home Affordable Modification Program (HAMP) on their own, or they can seek assistance from a housing counselor approved by the U.S. Department of Housing and Urban Development at no charge. Koster also noted that only your mortgage servicer has the discretion to grant a loan modification. He alerted consumers that, in most cases, charging fees in advance of a mortgage modification is illegal in Missouri.
Koster urged consumers who contracted with Legal Helpers Debt Resolution or Mortgage Law Group and did not receive services as promised to contact his Consumer Protection Hotline at 800-392-8222 or file a complaint online at ago.mo.gov. Consumers also should report to the Attorney General any other mortgage or debt modification companies that did not provide services as promised.
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