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Mortgage Rescue Scam Results in Guilty Plea From Lawyer

In a look into the future when more lawyers are going to find themselves in hot water from current foreclosure avoidance scams, yet another lawyer has been found guilty of running a foreclosure rescue or mortgage rescue scam. This time the show unfolded in Pennsylvania.

The government alleged that Doherty and four others targeted homeowners facing foreclosure, promised to help them save their homes, engaged in real-estate transactions with straw purchasers and obtained dozens of bogus mortgages.

Authorities said most of the victims did not ultimately lose their homes in the scheme. Doherty, a bankruptcy lawyer, admitted involvement with four mortgage scams involving homeowners in Chalfont, Quakertown, Perkasie and Lumberville. The Perkasie and Lumberville homeowners were clients of Doherty.

In fall 2004, Doherty mailed advertisements to distressed homeowners and referred respondents to co-defendant Edward McCusker, who owned a mortgage company. McCusker, who has pleaded not guilty in the case, allegedly told homeowners he could save their homes by getting a mortgage in someone else’s name for a year, while they leased the house back at a rent they could afford.

Instead, court papers said McCusker, of New Hope, arranged for the homeowner’s residence to be transferred to a straw purchaser, used fake documents to obtain a mortgage in the name of the straw purchaser and took proceeds of sales for himself and co-defendants.

The plea memo said that Doherty and his partner, Jeffrey Bennett, received an initial referral fee of $1,500 per mortgage, later increased to 2 percent of the loan proceeds. The fee wasn’t disclosed on the settlement form as being paid to Doherty and Bennett, the plea memo said, to conceal incentive payments the law firm was receiving to steer homeowners to McCusker. – Source


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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.

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