NATIONAL CONSUMER PROTECTION WEEK ? ANNOUNCEMENT #6
New Jersey Division of Consumer Affairs Acts to Obtain $400,000 in Consumer Restitution from Three Unlicensed Mortgage Modification Companies
NEWARK ? The State Division of Consumer Affairs has issued Notices of Violation to three companies and their operators who took payments from consumers for mortgage modification services without being licensed by the State as legally required.
None of the 270 consumers who have filed complaints to date were able to get their mortgages modified. The consumers collectively paid $398,059 to the three companies.
The Division of Consumer Affairs issued Notices of Violation to the following, with the number of consumer complaints received and the amount of restitution owed to consumers as noted:
Secure Property Solutions, LLC and Joseph A. Gembala, III and Associates, LLC, formerly located in Barrington, N.J.; 250 complaints; $364,147
Fresh Start Home Modifications, LLC (aka FSHM) and Thomas R. Mansell, Jr., formerly located in Woodbury Heights, N.J.; 19 complaints; $32,811
Financial Investigators of America, LLC and Michael Quellman, formerly located in Red Bank, N.J.; 1 complaint; $1,100
The Notices of Violation state that each of the named parties violated the State?s Consumer Fraud Act by committing unconscionable business practices through not being licensed as debt adjusters by the State Department of Banking and Insurance.
?The law is clear ? debt adjusters must be licensed by the State Department of Banking and Insurance,? Attorney General Jeffrey S. Chiesa said. ?We allege that these parties broke the law. We?ve taken action to hold each accountable and to get money returned to the consumers who were deceived.?
In addition to restitution, each of the three companies must pay a $5,000 civil penalty to the State and cease from advertising, offering to sell, and selling debt adjustment services.
Each has the option to accept the settlement terms outlined in the Notice of Violation or contest the Notice at an administrative hearing with the State Division of Consumer Affairs.
?Homeowners working to keep their residences are often put into a worse situation by unlicensed companies offering mortgage modification assistance,? said Thomas R. Calcagni, Director of the Division of Consumer Affairs. ?In this difficult financial climate, with so much at stake for struggling homeowners, our Financial Fraud Section has substantially intensified its enforcement efforts against these often fly-by-night mortgage modification outfits ? shutting them down whenever possible.?
Investigators with the Financial Fraud Section within the Division?s Office of Consumer Protection conducted the investigations that resulted in the Notices of Violation. In all, the Division of Consumer Affairs has charged nearly 70 companies that allegedly offered mortgage modification services to consumers without being licensed to do so.
In February, the Office of the Attorney General and the Division of Consumer Affairs won a $469,500 trial decision against two corporate defendants and two individuals accused in a lawsuit of defrauding financially struggling homeowners through a variety of deceptive mortgage foreclosure ?rescue? practices.
NATIONAL CONSUMER PROTECTION WEEK (NCPW) is a coordinated campaign that encourages consumers nationwide to take full advantage of their consumer rights and make better-informed decisions. NCPW 2012 runs from March 4 through 10 and additional information is available at www.NCPW.gov .
Consumers who believe they have been cheated or scammed by a business, or suspect any other form of consumer abuse, can file a complaint with the State Division of Consumer Affairs by visiting its website or by calling 1-800-242-5846 (toll free within New Jersey ) or 973-504-6200.
Follow the Division of Consumer Affairs on Facebook, and check our online calendar of upcoming Consumer Outreach events.