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California AG Takes Action Against Foreclosure Consultants & Loan Modification Companies

Continuing his fight against scam artists who “prey on” vulnerable Californians, Attorney General Edmund G. Brown Jr. today issued a directive forcing foreclosure consultants to register with his office and post a $100,000 bond by July 1, 2009.

Those who fail to do so will be in violation of state law, subject to criminal penalties of up to a year in jail and fines ranging from $1,000 to $25,000 per violation.

“California is awash with con artists who prey on vulnerable families facing foreclosure,” Brown said. “By forcing foreclosure consultants to submit detailed information to my office and post a $100,000 bond, this registry will help bring long-overdue transparency to this shadowy world.”

Up and down the state, scam artists pose as legitimate foreclosure consultants, promising homeowners they will prevent foreclosure. In reality, these scam artists charge huge up-front costs, but don’t provide an ounce of help.

Earlier this month, Brown’s office prosecuted a scam artist who provided hundreds of homeowners with forged bank documents and directed them to send their mortgage payments to accounts she had created, instead of the homeowners’ lender.

Additionally, Brown’s office has seen a significant increase in the number of complaints from homeowners regarding foreclosure consultants.

The registry unveiled today will provide Californians with information about potential consultants and recourse in the event that a consultant violates the law.

All foreclosure consultants operating in California must post a $100,000 bond and register with Brown’s office by July 1, 2009 and submit the following information:

  • Name, address, and telephone number;
  • All names, addresses, telephone numbers, websites, and e-mail addresses used or proposed to be used in connection with their business;
  • Copies of all advertising;
  • Copies of each different contract the consultant will use with consumers; and
  • A copy of its $100,000 bond.

Foreclosure consultants who provide proper information will receive a Certificate of Registration. Brown’s office, however, may refuse to issue, or revoke, a Certificate of Registration if the foreclosure consultant has made any misstatement in its registration form, has been convicted of fraud or misrepresentation, has been convicted of a violation of the state’s foreclosure consultant laws, California’s false advertising, unfair or deceptive practices laws or other laws dealing with mortgages.

If the company violates the law, a court may order restitution to victims out of proceeds from the $100,000 bond.

In order to obtain a Certificate of Registration by July 1, 2009, foreclosure consultants should send in their registration application and materials as soon as possible so they can be reviewed prior to July 1.

The registry was established through legislation sponsored by Speaker of the Assembly Karen Bass, AB 180, which was signed into law last year.

A copy of the registration forms may be found at http://ag.ca.gov/register.php under the “Foreclosure Consultant Registry.”

After July 1, 2009, consumers can call the Attorney General’s office to determine whether the company they are considering dealing with has been issued a Certificate of Registration.

Tips for Homeowners

  • DON’T pay money to people who promise to work with your lender to modify your loan. It is unlawful for foreclosure consultants to collect money before (1) they give you a written contract describing the services they promise to provide and (2) they actually perform all the services described in the contract, such as negotiating new monthly payments or a new mortgage loan. However, an advance fee may be charged by an attorney, or by a real estate broker who has submitted the advance fee agreement to the Department of Real Estate, for review.
  • DO call your lender yourself. Your lender wants to hear from you, and will likely be much more willing to work directly with you than with a foreclosure consultant.
  • DON’T ignore letters from your lender. Consider contacting your lender yourself, many lenders are willing to work with homeowners who are behind on their payments.
  • DON’T transfer title or sell your house to a “foreclosure rescuer.” Fraudulent foreclosure consultants often promise that if homeowners transfer title, they may stay in the home as renters and buy their home back later. The foreclosure consultants claim that transfer is necessary so that someone with a better credit rating can obtain a new loan to prevent foreclosure. BEWARE! This is a common scheme so-called “rescuers” use to evict homeowners and steal all or most of the home’s equity.
  • DON’T pay your mortgage payments to someone other than your lender or loan servicer, even if he or she promises to pass the payment on. Fraudulent foreclosure consultants often keep the money for themselves.
  • DON’T sign any documents without reading them first. Many homeowners think that they are signing documents for a new loan to pay off the mortgage they are behind on. Later, they discover that they actually transferred ownership to the “rescuer.”
  • DO contact housing counselors approved by the U.S. Department of Housing and Urban Development (HUD), who may be able to help you for free. For a referral to a housing counselor near you, contact HUD at 1-800-569-4287 (TTY: 1-800-877-8339) or www.hud.gov.

Brown’s Actions to Help Homeowners and Stop Loan Modification Fraud

Sued Countrywide For Predatory Lending And Secured $8.6 Billion Settlement. In October 2008, Brown announced an $8.68 billion settlement with Countrywide Home Loans, once the largest lender in the county, after the company deceived borrowers by misrepresenting loan terms, loan payment increases, and borrowers’ ability to afford loans.

Obtained Guilty Plea From Woman Who Operated Sophisticated Loan Scam. In May 2009, Brown obtained a guilty plea from Anna Santos, 22, who used forged documents to convince more than 100 desperate homeowners to hand over an average of $3,000 for non-existent loan modification services.

Shut Down “Foreclosure Freedom” And Announced Arrest Of Two Loan Modification Scam Artists. In March 2009, Brown shut down Foreclosure Freedom, a fraudulent loan modification company that continued to collect fees and mortgage payments from dozens of homeowners without ever providing loan modification services. The two scam artists were charged with 24 counts of grand theft and 25 counts of foreclosure consultant statute violations.

Broke Up “First Gov” And Sent Five Members To Prison. In November 2008, Brown shut down First Gov, a company that demanded $1,500 to $5,000 in up-front fees to modify loans it never renegotiated. In March 2009, five members of the ring were sentenced to a total of 18 years in prison.

Ended “Federal Land Grant” Foreclosure Rescue Scam. In May 2008, Brown ended a scam in which hundreds of homeowners were convinced to pay $10,000 to place their property in a land grant, a phony and worthless real estate document, and then convinced to sign over the deed to their home.

Shut Down Six Predatory Lending Companies. In March 2008, Brown shut down Lifetime Financial, Nations Mortgage, Greenleaf Lending, Virtual Escrow, Olympic Escrow and Direct Credit Solutions for promising homeowners unrealistically low mortgage payments and then switching them to loans that did not match the original agreement, many with hidden fees of up to $20,000. The three scam artists who operated the scheme have been sentenced to three years in prison.

California AG Takes Action Against Foreclosure Consultants & Loan Modification Companies
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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Todd

    I checked with California State Bar website on… Attorney Rhonda K. Walker SBN 175108 and it shows 2 disciplinary suspensions, several downloadable cases at the bottom of her profile in the red downloadable pdf.files that she stipulated (Admitted!) to receiving payment ..and NOT performing duties of representing her clients..Causing TRUE And REAL HARM ! Also I checked with United States Bankruptcy Court Central District of California.. and she WAS .. Suspended from practicing law on July 13, 2010, and was sanctioned fines.
    Your past and your criminal actions are Catching up to you …”Attorney Rhonda K. Walker” ! And more is legal action against you is currently in the process of being investigated by the California Attorney General office and California State Bar. You are trying to create some imaginary 3rd party that does not exist ! It won’t work ! It is ..You.. and No one else.
    This is all documented and is public information for the world to read ! Denial is not going to save you from the truth of your intentional malicious actions and your immoral, unethical representations under the professional code the California State Bar.

  • SeanDSLegalPlan

    I would find an attorney willing to do it on contingency- If you can. Especially now, with the national front fee ban on loan modification, we are already seeing A LOT of companies “partnering” with a lawyer so they can charge fees, regardless of the outcome-

    If your Mom is already in a short sale deal w/ Keller, WHY does she need an attorney?

  • Lisa

    Hi Steve,

    Spoke with someone about this company, they talk a good game. However, as with anything I do my research first and found that this company is affiliated with PSG Attorneys. At which point I found your thread from June 21, 2009. At the end Ryan Sechser swears he will pick one winner and do a short sale for them. wondering if this ever happened. Also you spoke with him is it your honest opinion this is a legitimate deal? If so I’m looking to refer my mother in law who is currently already in the shortsale process with Keller Williams. If I callI might belive anything as I don’t realy know much about this process.

  • StopRhonda

    Hi Hazelstacy, yes I am a recent victim of Rhonda K walker, she is a big time con artist scammer. I found many other complaints about her. She had a partner his name is William Geiger he goes by Steve. I am in the middle of attempting to collect my money from her. They are horrible and need to be stopped.

  • Hazelstacy

    Rhonda K. Walker has been disciplined by the State Bar of California as of 10/13/2010 is suspended for 2 yeares. . As of 7/22/2010 she has been barred from practicing law from The United States Bankruptcy Court Central District of Calfornia. Avoid this Attorney period! She has a long list of complaints that are still under investigation and most likely will face major panalties and sanctions.

  • Hazelstacy

    Rhonda K. Walker has been disciplined by the State Bar of California as of 10/13/2010 is suspended for 2 yeares. . As of 7/22/2010 she has been barred from practicing law from The United States Bankruptcy Court Central District of Calfornia. Avoid this Attorney period! She has a long list of complaints that are still under investigation and most likely will face major panalties and sanctions.

    • StopRhonda

      Hi Hazelstacy, yes I am a recent victim of Rhonda K walker, she is a big time con artist scammer. I found many other complaints about her. She had a partner his name is William Geiger he goes by Steve. I am in the middle of attempting to collect my money from her. They are horrible and need to be stopped.

      • Lisa

        Hi Steve,

        Spoke with someone about this company, they talk a good game. However, as with anything I do my research first and found that this company is affiliated with PSG Attorneys. At which point I found your thread from June 21, 2009. At the end Ryan Sechser swears he will pick one winner and do a short sale for them. wondering if this ever happened. Also you spoke with him is it your honest opinion this is a legitimate deal? If so I’m looking to refer my mother in law who is currently already in the shortsale process with Keller Williams. If I callI might belive anything as I don’t realy know much about this process.

      • Anonymous

        I would find an attorney willing to do it on contingency- If you can. Especially now, with the national front fee ban on loan modification, we are already seeing A LOT of companies “partnering” with a lawyer so they can charge fees, regardless of the outcome-

        If your Mom is already in a short sale deal w/ Keller, WHY does she need an attorney?

      • Rhonda Walker

        I do not have and have never had any partner by the name of William Geiger or Steve. I have no partners.If you paid money to William Geiger or Steve, please seek your recovery from them. Please contact me to discuss and see if I can assist you in any manner. I have evidence that third parties were using my name and documents to create business for themselves and trying to handle loan modifications using my name, which created quite a problem for me.

    • Rhonda Walker

      Your information is unfortuntately incorrect. Please check with both the State Bar of California and the Central District of California Bankrutpcy Court. I was not suspended for 2 years nor am I barred from practicing law before the United States Bankruptcy Court. Unfortunately, it is likely you paid money to third parties that were using my name. I have no client by your name. Please contact me to clear this matter.

  • Angie

    How did this end? I was wondering what the steps were & how the process goes. Was there a part of this I have missed?

    Thank you
    Angie

  • http://www.psgattorneys.com Ryan Sechser

    Steve,

    I welcome 5 applicants for loan modifications. I will conduct a drawing and the winner, PSG Attorneys will pay for thier loan modification. Diane Watson sent me the form sent to Loretta. There was nothing wrong with it. Every one is entitled to thier opinion, however as I stated, she could have called me at any time or returned my phone calls. Instead she choose to post on a public forum, and here we are. Any ways, ALL GOOD! Our company just recieved a contract for 75 short sales in the next 90 days. Maybe this advertisment on your site has paid off! Thanks!

    Ryan Sechser
    PSG ATTORNEYS
    [email protected]
    713-653-3956

  • loretta hankerson

    Steve
    I’m gonna make my comments directly to you since I was advised that a legal issue may result in my posting on this site. This is not a tag situation and since the gentleman clarified what could have possibly been the reason for the apperance, then I have no more to say. I know that the person who was trying to assist me with the information to start the process should have written the info. more legibly than was done. Regaredless, anyone would have formed my opinion if they saw the form. My husband and son saw it before I deleted it and thought the same thing. Oh well. I’m done and wish the best to the company in the future. Steve my opinion stays the same. Wish I had the form to show.

  • http://www.psgattorneys.com Ryan Sechser

    I appreciate the information (opinion) Loretta; however you have had my phone number and could have just called. I receive over 10 Pre qualification request every day and this is the first complaint. The form is NOT part of the legal process. The legal process does not start until PSG Attorneys assigns you to an attorney. Maybe the fact that Diane Watson just had surgery and was under the weather, affected her hand writing or notes that did not meet your satisfaction. Nothing that a phone call could not have taken settled. I received 4 pre qual requests from people today that spoke to Diane, and I personally called every one of the clients. They all spoke very highly of her, and were excited about the NON pressure/educational format of our company. Maybe we can “chalk it up” to mis-communication. Unfortunately this is a public issue now, and I have to address this to the world. I am positive this will turn into a great advertisement for my company. So all being said, I owe you a BIG THANK YOU!
    What I am prepared to do, is accept 5 prequalification requests generated from this blog site. I will put all names in a hat, and draw a winner. The winner PSG Attorneys will pay the attorneys to complete the loan modification. The “winner” can keep track of their progress on this site for the world to see.

    I look forward to the 5 candidates for the drawing!!

    Respectfully,

    Ryan Sechser
    PSG Attorneys

  • loretta hankerson

    Thanks Steve,

    I think that will be a great thing to do is too clear all misconcieved ideas that this company is not a legitmate and great company to do business with. Any company no matter how legitmate they are may have a flaw with anything being it policies, employees, or working conditions and surroundings. I hope that if you can have this demonstrated it will be very helpful to myself and others. But please keep site that my issue was more of how the form appeared. It may not have been a legal document, but it is part of a legal process and that makes way for professional and legiable appearance.

    Your thoughts and concerns are greatly appreciated.

    Loretta

  • loretta hankerson

    Steve, Thank you for seeing it both ways. I only thought I had a legal right to voice my concerns about issues with Modification companies. I never meant for the company to appear as though they were not legitimate and somethings maybe should not have been listed, but still they were facts, not heresay. If not me it could have been someone else’s opinion as well. I only wanted to know this information based on why the article’s title was about loan modification companies. When the gentleman’s name I mentioned posted back the comments to me, somethings said were not the order of information I got. I will leave it at that. Never meant any harm, not trying to make a bad reputation or anything. Only wanted to be sure.

    • http://GetOutOfDebt.org Steve Rhode

      Loretta,

      Your opinion and perception about your experience is valid and I appreciate you sharing it. No worries.

      I’ve put a call in myself to talk to Ryan about all of this and to learn more about what they are doing.

      Steve

      • http://GetOutOfDebt.org Steve Rhode

        Good News: I spent quite a bit of time talking to Ryan on the phone about the loan modification services from PSG Attorneys. I think I have a good understanding of how the network operates.

        I’ve asked him if he would be willing to take on a loan modification case for free that we can follow on the site to see what actually happens along the way. I’ll post an article about this as we firm up details.

        Steve

  • http://www.psgattorneys.com Ryan Sechser

    Steve, I forgot to let you know:

    PSG Attorneys offers a free do it your self loan modification kit prepared by our attorneys. No strings attached! Just go to http://www.psgattorneys.com and request the “Secure Guide” to modifying your own loan. It has all the forms, instructions, hints and tips to a successful modification. There is also contact information for non profit organizations. We prepared this kit for people who might not be able to afford an attorneys.

    Talk to you soon!

    Ryan Sechser

  • http://www.psgattorneys.com Ryan Sechser

    Loretta,

    Diane Watson is a consultant for PSG Attorneys. Diane helps pre screen clients, so that the Law Firms we work with can determine if a homeowner is a “good candidate” for a loan modification. I have the highest regards for Diane, never receiving even one complaint, in fact, many referrals from the homeowners she speaks to. The form Diane sent you WAS NOT a legal document/form. The form is a pre qualification request; so that our groups can pre qualify you. You can easily find this form on http://www.psgattorneys.com. In my response to your public posting, I left you my telephone number and company email. You still choose to respond on a public forum which makes me very curious about your motives. I am a little upset that when people Google PSG ATTORNEYS; it comes up with a tag linked to Attorney General Takes action against loan modification consultants. You may not realize this Loretta, but this is a result of your unjustified complaint about my company. We never accept money from clients, before, during or after the modification process. You get a free consultation with an assigned attorney, and then if the attorney wants to accept your case, and you want to move forward, you pay the attorney direct. PSG Attorneys is not involved in this process, and this is in writing in all of our paperwork. I left 2 messages for you this morning and 2 messages for you tonight. I would ask that you find help elsewhere, and refrain from public postings about our company. We have done nothing to hurt you, and do not deserve this public exposure of negativity. I wish you the best.

    On another note, Steve Rhode, thanks for your comment! I ask that you give me a call sometime. I would like to give you a full disclosure tour, let you speak to the attorneys and find out that PSG Attorneys is compassionate about homeowners. I am sure that once you have performed your due diligence, you will find we offer the security and peace of mind that homeowners deserve.

    Please call any time

    Ryan Sechser
    713-653-3956

    • http://GetOutOfDebt.org Steve Rhode

      Ryan,

      I will call. I know you may be upset how your name may now appear in Google but I have found over the years that consumers that do research online are pretty smart folks. If they click on this story what they will find is that you have actively addressed the issue, provided contact information, attempted to clarify the position from your point of view, and kept it civil.

      Loretta may have stated information that is not accurate from your point of view but it does appear that she clearly saw events from a different point of view. That’s the problem with perception, no two views are the same. I’m monitoring this thread and watching for it reach a conclusion.

      Steve

  • loretta hankerson

    Ryan, Who is Diane Watson? Is she not a representative of your coroporation? I was assigned to her as a consultant with your corp. I spoke to Ms Watson about 3 days ago and she said that your corp. could assist me even though I am an employee woth your corp. I sitll have not completed the information for the final process to become a consultant and she said that I am considered as being a consultant in spite of not completing the necessay forms. She said she was going to contact you regarding my issues and that she was emailing me the I believe the form to start the loan modification process which had the appreance of an income expenses sheet or something and this is what I considered as a legal document very unprofessionally filled in. I don’t know if Ms Watson filled out the form or if she has an assistant but, whatever it was not looking legitimate. I not saying it was not a legal form but the way it was filled in with the writing going of the line and under and down as though it was running off the paper. Too me it did not have the appearance of being a legal doucment filled in so sloppy like. She also said that I needed at least 1500.00 to get the process going just to speak with an attorney. Once I spoke with the attorney and did not agree with the terms of the modification, I could get a full refund of the 1500.00 back. She said nothing about minus attorney fees for consulting or anything. I unfortunately deleted the form after seeing how it was filled in. I wish I had keep it in folder like some of the notices I’ve recived from you and her about the phone meetings. I can paste information from her about the meetings as proof of contact with her. If you are associated with Ms Watson, can you request a copy of that form so you can see it yourself? I did email you the day after Ms Watson sent me the information with the modification form and did not get any response from you and you sent me something the very next day about the phone conference for asking question by the consulants If I remeber correctly. I’m not trying to BLAST PSG attorneys. Just want to be sure after reading about the CA AG getting involved. I did not know you weren’t affiliated with Rhonda Walker anymore. Sorry. Do you recall this information from Ms Watson?

    Hi Loretta,

    I an your Team Leader so if you need anything, please just ask. Her is all the new paperwork. You need to fill out the new Marketing Agreement and get that back to me as soon as you can. Please fax to 866-521-2289.

    Thank you,

    Diane M Watson
    Loan Modification Specialist
    The Law Offices of Rhonda K. Walker
    50 Joshua Drive
    Manchester, NH 03103
    Tel-603-232-9195
    Toll Free-888-705-1338
    Fax-866-521-2289
    [email protected]
    [email protected]

  • http://www.psgattorneys.com Ryan Sechser

    Loretta,

    This is Ryan Sechser, president of PSG Attorneys. I wanted to respond to your comment and clear up some facts.

    First, our company is NOT associated with The Law Office of Rhonda Walker. Previously our company was pre screening clients for Rhonda, however her service did not meet our standards. PSG Attorneys works with 7 Law Firms in NY, CA, NJ, PA and FL with attorneys licenced in many states.

    Second, PSG Attorneys NEVER ask for money up-front from homeowners. In fact, we never ask for money, even after the modification process in completed. Our role is to pre-screen you for a loan modification(pre qualify) and then assign you to an experienced attorney that is willing to take your case. Then you receive a FREE attorney consultation after a case review. Only after that point, if you choose to move forward and hire the attorneys directly, and the attorney accepts you as a client, would you pay the attorney 1500.00. The attorney is paid direct, enforcing an attorney/client relationship.

    Third, is response to the forms that the rep wrote on, please forward this paperwork to me immediately: [email protected]. What you are describing is NOT our policy and I would love to see exactly what your are speaking about.

    Finally, if my memory serves me correct, did you just not request a free consultation with an attorney just 2 days ago? Were you not looking at working with our company? It concerns me that you have my phone number and email, and have not contacted me before blasting concerns on the internet that can be mis-conceived as if we were not legitimate. Please contact me regarding these points mentioned.

    Have a great Sunday!

    Ryan Sechser
    713-653-3956

    • http://GetOutOfDebt.org Steve Rhode

      Ryan,

      Thank you for publicly responding and clarifying information.

      Steve
      @GetOutOfDebtGuy

  • loretta hankerson

    There is co in CA which is called PSG Attorneys through law office of Rhonda Walker. Have you heard of them? They have a person who is in New Hampshire as a source that asked for 1500.00 upfront and the application she emailed had the writing going down the side of the form and not on the lines with a dash to continue on next line but under the lines and over words on the application. I thought how very unprofessional and messy for a legal document. Do you have any info about this company? Another person is called Ryan Scheser and another is Jim Pullera.

  • http://www.beaversbill.com Bill Beavers

    Human Nature, the dark side. Isn’t it amazing how predators are always lurking. The prey on folks with money and surprisingly folks with very little money. I think this was a great idea, something I don’t usually say about gov’t decisions to “protect us” all. I am a mortgage loan officer who, at one time, considered going to the Mitigation business but decided against it. Good Decision. Great article/post. Lots of good information and updates in here. My first visit. “I’ll be back!” All the best.

    Bill Beaverss last blog post..Laughing at Debt

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