Officials allege the groups used Spanish ads to falsely promise they’d cut mortgage payments in half – but homeowners shouldn’t pay mortgages or talk to their lenders.
ORLANDO, Fla. – The Department of Justice (DOJ) entered a consent order with numerous Florida businesses that it said violated the Fair Housing Act after targeting Hispanic homeowners.
Advocate Law Groups of Florida, Summit Development Solutions and numerous other parties were accused of targeting of predatory loan modification services, the DOJ announced last Friday.
Federal officials said the groups used Spanish-speaking advertising that falsely promised to cut mortgage payments in half. They engaged with hundreds of Hispanic homeowners promising to lower payments, and extracted thousands of dollars of upfront and continuing fees, according to the DOJ.
The defendants specifically targeted Hispanic homeowners because they didn’t speak English well.
Dept. of Justice officials said the defendants told the homeowners not to pay their mortgage or talk with their lenders while not fulfilling their promise for loan modifications. As a result, many of those people defaulted on their mortgages and lost their homes, according to the DOJ.
The agreed-upon consent order is for $4.5 million. Defendants will pay $95,000 to the three intervenors and a civil penalty to the United States. For now, the monetary judgment is suspended because the defendants claim they can’t afford to pay it back due to limited net worth.
They will have to provide updated financial documents for five years. If they’re found to be lying about their financial assets, the court will make them immediately liable for the total amount.
Officials said in addition to the penalties the defendants are permanently forbidden from providing any form of mortgage relief services.
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