In 2008, the Florida Legislature passed the Foreclosure Fraud Rescue Act, a law which was intended to protect Floridans from unscrupulous con artists who take money from homeowners and promise they can get a modification of the homeowner’s mortgage. The full text of the bill can be found here. Short and simply, any person or company who takes a fee from a homeowner for the promise or expectation of getting that homeowner’s mortgage modified are subject to the following:
A person who violates any provision of this section commits an unfair and deceptive trade practice as defined in part II of this chapter. Violators are subject to the penalties and remedies provided in part II of this chapter, including a monetary penalty not to exceed $15,000 per violation.
The Florida Legislature followed this law up with new legislation in the 2009 Legislative Session that placed further regulations on mortgage modification companies in Florida. The full text of this law can be found here. This law made changes to the mortgage brokering and lending statute and requires, among other things, that modification companies be licensed as mortgage brokers.
The laws and legislative intent are good; the problem is not nearly enough is being done to enforce these laws and protect consumers. In the last several weeks, I’ve come across mortgage modification scams operating phone banks and engaging in the aggressive solicitations the legislature intended to prevent. I’ve dutifully investigators in the Florida Attorney General’s Office, but was recently disturbed to learn that the AG’s office is no longer aggressively pursuing mortgage rescue fraud companies….in two cases in particular, I had contacted the companies and had them promise me that they could save my home from foreclosure….no need to hire an attorney….just send them money.
I contacted the AG’s office with names, details and phone numbers…I had the names and information about the representatives that were aggressively contacting me. It drove me nuts to hear the phone banks operating in the background because I knew their operators were taking advantage of consumers…I hoped that the public servants would take their jobs seriously and take action on the complaints…I’m disappointed to report that I got very little response from the investigators…In fact, the AG’s office advised me that they were no longer taking the lead in such investigations….wow, what a letdown….
The AG’s office still contains a link on their website and I strongly encourage consumers to contact the AG’s office at 1-866-9-NO-SCAM to report mortgage rescue scams….who knows if it will do any good….but if nothing else, take some time to ask them why consumers continue to get ripped off and ask them why the Attorney General doesn’t seem to care.