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California state regulators say they’ve teamed up with the Federal Trade Commission to shut down a Los Angeles-based mortgage relief operation that allegedly deceived hundreds of homeowners nationwide into paying at least $6.3 million for fraudulent mortgage modification services.
Launched in 2018, backers of the operation promised to help distressed homeowners negotiate with mortgage companies to lower their interest rates, monthly payments or principal amounts, according to a joint complaint filed by the Federal Trade Commission and the California Department of Financial Protection and Innovation (DFPI).
Instead, defendants Roger Scott Dyer and Dominic Ahiga are accused of pocketing borrowers’ payments, according to the Sept. 12 complaint. Inman was unable to reach Dyer or Ahiga, also known as Michael Dominic Grinnell, for comment.
Although regulators said they “file complaints when they have reason to believe that the law has been or is being violated,” they were careful to note that the “case will be decided by the court.”
The complaint was unsealed Monday after regulators obtained a temporary restraining order from a federal judge allowing them to halt the mortgage relief operation and freeze its assets. A receiver has been appointed to assist with taking over the defendants’ businesses and to administer any relief for victims.
The complaint alleges that the mortgage relief operation lined up victims through a number of entities, including Home Matters USA, Academy Home Services, Atlantic Pacific Service Group, and Golden Home Services America. The corporate defendants named in the complaint are Apex Consulting & Associates Inc., Green Equitable Solutions, Infocom Entertainment Ltd Inc. and South West Consulting Enterprises Inc.
The defendants and their businesses “have been the subject of prior law enforcement actions by the states of Ohio, Washington, Oregon, Connecticut, and North Carolina, as well as action by the State Bar of California,” the California DFPI said in announcing the joint enforcement action with the FTC.
In many cases, the complaint alleges, the companies claimed to be affiliated with government agencies, or that their services were part of government COVID-19 assistance programs.
“At a time when millions of Americans were dealing with a pandemic and struggling to pay their mortgages, defendants preyed on consumers with false promises of mortgage assistance relief” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection, in a statement.
Victims were often instructed to stop making payments on their mortgages, leading many to incur late fees and “significantly lower credit scores,” regulators said. Some who signed “cease and desist” letters requiring lenders to communicate only with the mortgage relief companies ended up in foreclosure.
The Better Business Bureau lists 37 complaints against Home Matters USA, with an 11 percent response rate by the company. Home Matters USA is not accredited by the BBB and has an “F” rating.
“Me and my wife hired [Home Matters USA] to do a loan modification on our home because I got laid off work and cannot make our payments,” said one complaint filed with the BBB on July 22. Home Matters USA, “promised us a lower interest rate and [to] get our payments down from $2,600 a month to $1,900 a month. They told us they would take care of us and told us to pay them $1,700 a month and they will deal with our lender.”
After “almost a year and a half with no [bills] being sent to our home address we thought everything was going fine,” the complaint said. “Then we got a letter that our house was in the default so I called Home Matters and they said don’t worry about it they got it handled.”
But it turned out that the homeowner’s $1,754 monthly payment “was going directly to Home Matters, and nothing to my lender, so now my lender tells me that we owe them $25,000.”
It was the first joint FTC and DFPI action under enforcement powers provided under the California Consumer Financial Protection Law (CCFPL), enacted in 2020.
The joint complaint alleges that the defendants and their companies violated the CCFPL, as well as the Federal Trade Commission Act, the FTC’s Mortgage Assistance Relief Services Rule (the MARS Rule or Regulation O), the Telemarketing Sales Rule, and the Covid-19 Consumer Protection Act.
“We are excited to build on our relationship with California’s DFPI in this case and will continue to work with our state partners to shut down schemes that take advantage of consumers experiencing financial hardship,” Levine said.
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