California Attorney General Edmund G. Brown Jr. today shut down two fraudulent foreclosure-assistance companies and secured a court judgment that prohibits three individuals from working in the real estate industry and provides more than $1 million in restitution for victims left with “false hope” after paying upfront fees for nonexistent loan-modification services.
“George Escalante, Cesar Lopez and Adrian Pomery used their loan-modification companies to sell false hope to hundreds of Californians facing foreclosure,” Brown said. “This judgment shuts their companies down, locks them out of the real estate industry and pays back more than $1 million to the victims.”
On July 7, 2009, Brown filed suit against two affiliated companies based in Orange County, U.S. Foreclosure Relief Corp. and H.E. Servicing, Inc., as well as their executives, George Escalante and Cesar Lopez, and legal representative Adrian Pomery. The suit was filed jointly with the Federal Trade Commission (FTC) and the State of Missouri as part of “Operation Loan Lies,” a massive federal-state crackdown on loan-modification fraud.
The joint investigation, initiated in March 2009, found that the defendants used aggressive telemarketing tactics to convince distressed homeowners to pay $1,800 to $2,800 in upfront fees for loan-modification services that included reductions in principal and lower interest rates. In sales calls, H.E. Servicing, for example, claimed it had successfully negotiated 10,000 loan modifications. However, a full review of internal records found the company opened only 2,960 loan-modification files and completed only 311. It is estimated that California homeowners accounted for 15 to 20 percent of the company’s opened loan-modification files.
Brown’s judgment permanently shuts down U.S. Foreclosure Relief and H.E. Servicing and prohibits the defendants from ever working in the real estate and loan-modification industries again.
Additionally, the judgment will provide more than $1 million in relief to victims paid through frozen company funds and the sale of Escalante’s jewelry, 2007 Mercedes SUV, 2007 Mercedes sedan and 2009 Toyota Tundra. Separately, Lopez declared bankruptcy in June 2009 and relinquished possession of a 2007 Cadillac Escalade SUV and 2008 BMW S Series sedan as part of those proceedings.
Under the judgment, a court-appointed independent receiver will oversee the repayment program. Victims can access more information about this program by visiting the receiver’s website at www.heservicingreceiver.com, by calling: 1-866-243-8101 or by emailing: info@heservicingreceiver.com.
The FTC’s enforcement division will monitor the defendants’ compliance with the judgment, and if they are found to have misrepresented their financial condition and inability to pay, the judgment, in full, will become due immediately. The full judgment requires total payment of $8.6 million from Escalante, US Foreclosure Relief and H.E. Servicing as well as $3.3 million from Lopez and $3.4 million from Pomery.
While in operation, H.E. Servicing spent $70,000 a week on radio and television advertising in 100 media markets nationwide and had plans to spend an additional $10,000 to $30,000 a week with the goal of bringing in an estimated $270,000 a week in new business. A report prepared by an outside accountant found that in the first six months of 2009 alone, the company made $4.5 million in net income.
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Did you notice how Escelante didnt go to jail and walked away with a suit case full of money..
DO YOU THINK I CAN RECOUP MY $2500.00 I SPEND ON POMERY AND ASSOCIATES
Gayle,
I’m not sure. contact the receiver in the article and ask them what the process is. I am sure there is a deadline so contact them soon.
Steve