A former attorney and day-to-day controller of a New York based debt settlement company pled guilty to criminal charges on Tuesday. Michael Levitis faces up to 10 years behind prison for ripping off consumers with his Mission Settlement Agency, and Alpha Debt Settlement.
The United States of America pursued Levitis for mail fraud and wire fraud as part of the criminal action filed against him. In attempting to be clever while Levitis ran the attorney model debt settlement firms on a day-to-day basis the companies were actually owned by his wife Marina Levitis, his mother, Eva Levitis, and Faye Levitis. – Source
Court papers say Mission claimed it “would charge a mere $49 per month” to slash its clients’ debts by up to 45 percent, but secretly scammed “thousands of dollars in fees from funds that its customers had set aside because they believed the funds would be used to pay creditors.” – Source
As part of his guilty plea Levitis told the court, “I’m here to take responsibility for my actions,” said Levitis, 37, before U.S. District Judge Paul Gardephe. “I took advantage of people who were struggling financially and caused them further hardship.” – Source
“Michael Levitis and his company, Mission Settlement Agency, preyed on the desperation of financially struggling people across the country. Today’s guilty pleas ensure that the defendants who falsely offer debt relief, telling their victims a pack of lies in order to line their own pockets, will be held to account.” Manhattan U.S. Attorney Preet Bharara said in a statement following the guilty pleas.
From 2009 through May 2013, at Levitis’s direction, the defendants systematically exploited and defrauded over 1,200 customers, who were financially disadvantaged people across the country struggling to pay their credit card debts.
They tricked people into paying Mission for purported debt settlement services by lying to prospective customers about Mission’s ability to help settle their debts, the fees that Mission charged, and Mission’s purported affiliation with the federal government.
Among other things, the defendants: (1) lied about and/or concealed Mission’s fees, falsely assuring customers that Mission would charge a mere $49 per month when, in truth, Mission took thousands of dollars in fees from funds that its customers believed would be used to pay creditors, (2) deceived customers by fraudulently and falsely promising that Mission could slash their debts – typically, by 45% — when, in fact, for the majority of its customers, Mission did little or no work and failed to achieve any reduction in debt, and (3) sent prospective customers solicitation letters that falsely suggested that the agency was acting on behalf of or in connection with a federal governmental program, which letters included an image of the Great Seal of the United States and indicated that they were coming from the “Reduction Plan Administrator” of the purported “Office of Disbursement.” As a result of the defendants’ scheme, in addition to losing money, most of Mission’s customers failed to achieve the reduction in debt that the defendants had promised them, and some of them suffered further declines in their credit ratings, were sued by their creditors, and/or fell into bankruptcy.
As alleged, the defendants fraudulently tricked people into paying Mission for debt settlement services by lying to prospective customers about its fees, and its purported affiliation with the federal government and one of the three leading credit bureaus in the U.S., as well as the results it supposedly achieved for its customers. In connection with the scheme, Mission received over $6.6 million in fees. For over 1200 of its customers, Mission took fees totaling nearly $2.2 million and has never paid a penny to the customers’ creditors.
The Levitis women and Mission Settlement Agency have agreed to a judgement of $2,196,522. – Source
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