Mass Joinder Lawsuits
as Foreclosure Rescue Schemes
California Atty. Gen. Kamala Harris, shown in May.
Credit: Los Angeles Times / Mel Melcon
California authorities have sued a group of lawyers and their associates, accusing them of fraudulently taking millions of dollars from thousands of homeowners by deceiving them into thinking they would receive relief on their troubled home loans.
Alleged Foreclosure-Prevention Scam
Shut Down by California
LOS ANGELES TIMES
Atty. Gen. Kamala D. Harris said Thursday that the California Department of Justice, in conjunction with the State Bar of California, sued Philip Kramer of Calabasas, the Law Offices of Kramer & Kaslow, two other law firms, three other lawyers and 14 non-lawyers.
The defendants are accused of working to defraud homeowners across the country by deceptively marketing "mass joinder" lawsuits, which have hundreds or more individually named plaintiffs.
At a news conference, Harris said the state would seek "fines, penalties, damages and restitution in potentially the tens of millions of dollars." She said the lawyers' assets had been frozen.
A phone call to Kramer's office was answered by a recording saying the Los Angeles Superior Court had taken control of the office and its files.
State and federal regulators, criticized for doing little to stop reckless lending and fraud during the housing boom, have rushed to find villains in the aftermath of the mortgage meltdown.
In May, Harris announced the formation of a special squad of lawyers and investigators to investigate mortgage fraud. But in June she said its operations would be curtailed because of state budget cuts.
The case announced Thursday is the first stemming from work by the task force, Harris said.
The attorney general's website offers advice on avoiding scams that promise loan modifications, with a list of individuals and businesses that have been sued.
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As if the misbehavior of Wall Street and the Too-Big-To-Fail Bankers hasn't hurt the American middle class badly enough, we also have lots of "little guy" crooks running around trying to capitalize on people's fear, in order to get them to throw their hard-earned money at whacky ideas which will NOT really keep them in their homes.
This is a place to list such schemes as they rear their ugly heads, to help warn the public away from these fraudsters.
Generally speakiing, Mortgage Rescue Schemes are scams that target those whose home is facing potential foreclosure. The scheme prays on desperate homeowners who are struggling with, or behind in their mortgage payments. These schemes cause difference kinds of harm to the homeowners, but it usually involves the owner ultimately being forced out of their homes, and losing even more money.
The irony is, most of the people who are tempted by these scams could likely have held on to their homes if they had just consulted an attorney experienced in the defense of mortgage foreclosures.
Florida has enacted a Foreclosure Rescue Scheme statute, with tough penalties for those who prey on the fear of homeowners, and fines up to $15,000 per violation.
