Arizona Attorney General Terry Goddard 2010 Annual Report

Public Advocacy Division
Division Summary
thousands of dollars of refunds
• Taken Care of Investments
The Public Advocacy Division is made up of the Consumer
Protection and Advocacy Section and the Environmental
Enforcement Section.
for consumers who paid upfront
fees, investigated several companies
and sent warning letters
to dozens more.
Taken Care of Investment is a
foreclosure rescue operation
that promised to help homeowners
by purchasing their
Chief Counsel Susan Segal
Mission:
To pursue those who
prey upon the public
and threaten the
economic and environmental
well-being
of Arizonans.
Consumer and
Public Advocacy (CPA)
Section Highlights
Consumer Litigation Unit
As Arizona’s housing crisis persisted,
fighting mortgage fraud
continued to be a top priority.
Thousands of struggling homeowners
sought to modify the
terms of their mortgage loans.
Mortgage lenders and loan
servicers, however, often lost
documents, gave contradictory
messages to consumers, failed
to timely respond to requests
and otherwise made the loan
modification process extremely
difficult for consumers.
The Office received numerous
consumer complaints against
lenders for deceptive practices
in handling loan modification
requests, and successfully
intervened in many cases. In
some instances, we were able
to persuade lenders to stop
foreclosure proceedings and to
offer a loan modification to the
homeowner instead.
With so many homeowners
struggling to keep their homes,
many “foreclosure rescue
consultants” sought to capitalize
on their difficulty. Promising
homeowners they could prevent
foreclosure by negotiating with
lenders to obtain a loan modification,
they charged thousands
of dollars in upfront fees then
often failed to deliver on their
promise or went out of business.
The Office also obtained
Significant mortgage and
loan modification fraud cases
included:
• Hope for Homeowners Now
The unit sued this company
and its principals based on
misrepresentations regarding
the company’s home
loan modification services
and its failure to comply with
the Credit Services Organizations
Act. We obtained
default judgments against the
company, awarding $424,935
for consumer restitution and
$155,000 for civil penalties.
The court also issued an
order prohibiting the defendants
from engaging in loan
modification or loan origination
activities in Arizona.
home, allowing the homeowners
to rent the home for a
year, and then allowing the
homeowner/tenant to repurchase
it. The rental terms
were so onerous that the tenants
were often evicted, foreclosing
repurchase options.
The properties were sold to
investors, further limiting the
repurchase ability of the original
homeowners. After suing
last year, the Office secured
a settlement requiring the
defendants to pay $391,000
to consumers as restitution
plus another $300,000 in
civil penalties to the State.
• Discount Mortgage Relief
The unit filed a complaint
against Discount Mortgage
Relief on June 4, 2010, and
Arizona Attorney General Terry Goddard • 2010 Annual Report
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