On May 21, 2010, the Modesto Bee reported that homeowners from seven Stanislaus County cities, including Modesto, were victimized in a multimillion-dollar loan modification scheme that promised to pull underwater owners out of imminent foreclosure. Instead, the operation simply robbed residents of as much as $5,000, never fulfilling the promise of loan modification.
The scheme was known by several names, including Mason Capital Group, LLC and Gretchen Fox and Associates. It was run out of a boiler room in Southern California by a dozen or so representatives who promised homeowners that, for a fee of several thousand dollars, they could modify their current loans to keep their houses out of foreclosure. In all, nine men were arrested on 97 charges of grand theft, unlawful foreclosure consulting, tax evasion and conspiracy.
Attorney General Jerry Brown said that the men bilked some 1,500 Californians out of more than $2.3 million, many of whom resided in Modesto and surrounding cities. In many cases, not only were homeowners denied the promised loan modifications, but they also lost their homes and accrued additional debt after paying the scammers.
Brown's office began investigating the scheme in 2009 after a number of consumer complaints. Reports indicate that many of the company's high rollers were using their ill-gotten gains to pay for private school tuition, travel, entertainment, shopping and lavish personal expenses. The Attorney General's office will seek restitution for the victims.
If you are facing foreclosure on your home, consider hiring a reputable bankruptcy attorney in Modesto. Don't rely on fly-by-night scams--if it seems too good to be true, it probably is. A lawyer will follow the letter of the law to help you save your home and rebuild your credit after financial hardship.
