Attorney General, DOL Director Announce Settlement in Mortgage Fraud Case; Loan Modification Company, Individuals Agree to $11.4 Million Judgment
TRENTON, NJ – April 29, 2010 – (RealEstateRama) — Attorney General Paula T. Dow and Division of Law Director Robert Hanna announced today that a New Jersey loan modification company and its owners have agreed to an $11.45 million judgment to settle civil charges they defrauded homeowners who sought help in staving off mortgage foreclosure.
Defendant New Hope Property, LLC, of Bellmawr, Camden County, has agreed to a judgment of $10 million to settle allegations its company, New Hope Modifications, took money up front from customers in return for promised mortgage rescue help – a prohibited business in New Jersey. In addition, New Hope is permanently barred under the settlement from selling debt adjustment, loan modification or foreclosure relief services in New Jersey.
Brian Mammoccio, identified as a registered agent of New Hope in New Jersey, agreed to a $1.2 million judgment to settle allegations against him. Mammoccio, of Mullica Hill, Gloucester County, has also consented to the revocation of his mortgage solicitor’s registration, and has agreed to never again apply for any license, registration or authority from the state Department of Banking. Donna Fisher, also identified as a registered agent of New Hope, must pay the state $250,000 and has consented to revocation of both her individual lender’s license and her mortgage solicitor’s registration. Fisher, also of Mullica Hill, has agreed to never again apply for any licensure from the Department of Banking.
“This is an important outcome, one that should send a clear message to anyone who may be tempted to seek profit in the financial misery of others during these tough times,” said Attorney General Dow. “We are committed to identifying and investigating this type of fraud, and we will take appropriate action where we find it.”
“This company, and these individuals, made money by selling false hope to trusting people during their darkest financial hour,” Dow added. “It is appropriate that their professional licenses are revoked, and that they will never again be permitted to operate in our state.”
Filed in March 2009 in New Jersey Superior Court in Camden County, the state’s original four-count lawsuit charged New Hope with violations of the Consumer Fraud Act, state advertising regulations and the Debt Adjustment and Credit Counseling Act.
The state’s investigation revealed thousands of victims nationwide.
In addition to charging New Hope with taking substantial up-front payments and failing to deliver any services, the lawsuit charged that New Hope had been engaged in unlicensed debt adjustment activities in New Jersey since 2007. The suit also charged that New Hope fraudulently sought to generate consumer confidence by creating the impression it was associated with the nationally-respected, non-profit foreclosure prevention program, the Hope Now Alliance. Among other services, members of the legitimate Hope Now Alliance offer free credit counseling with federally-approved and state-licensed counselors.
The state’s lawsuit charged that New Hope failed to return the payments of clients who sought refunds once they realized they were getting no mortgage rescue help, and sought to shut down a Web site through which New Hope had been offering its loan modification services in New Jersey and across the nation. (According to a Consent Judgment memorializing the settlement and filed recently with the state Superior Court, New Hope LLC and New Hope Modifications no longer operate, and the Web site is permanently shut down.)
The New Hope Modifications matter was handled on behalf of the state by Deputy Attorney General Megan Lewis, Chief of the Division of Law’s Affirmative Litigation Section and Deputy Attorney General Lisa D. Kutlin of the Affirmative Litigation Section and Deputy Attorney General Gregory McHugh of the Division of Law’s Banking, Insurance and Insurance Fraud Section. Deputy Attorney General Raymond Chance, Chief of the Division of Law’s Banking, Insurance and Insurance Fraud Section and Deputy Attorney General Samuel Scott Cornish of the Affirmative Litigation Section also provided assistance. The investigation was conducted by Investigator Joseph Iasso of the Division of Consumer Affairs, Office of Consumer Protection.
