Amasses 20,000 Foreclosure Rescue Scam Reports Representing $53M in Fraud
WASHINGTON, D.C – January 6, 2012 – (RealEstateRama) — The Loan Modification Scam Prevention Network (LMSPN) recently reached a critical milestone in the national effort to stop foreclosure rescue scams. Through the efforts of homeowners, housing counselors, advocates and Network partners from across the country, the national Loan Modification Scam Database, led by the Lawyers’ Committee for Civil Rights Under Law, has collected more than 20,000 scam complaint reports since its launch in March 2010.
These scam complaint reports represent more than $53 million lost to foreclosure rescue fraud. The Lawyers’ Committee estimates that the Database represents only a small fraction of the harm caused to distressed homeowners by foreclosure rescue scams. Hundreds of reports continue to be submitted every month on line, by mail and fax, and through calls to counseling hotlines. The Database has nearly doubled in size in less than a year.
The information-sharing facilitated by the Network is crucial to exposing shadowy operations that are stealing millions of dollars from distressed homeowners trying to save their homes from foreclosure. The broad coalition behind the Network includes dozens of local, state and federal agencies that all play a part in collecting the scam details from affected homeowners and using that information to educate the public, and to investigate and pursue civil and criminal actions against scammers.
“The database has become a central source of information for housing counselors, Treasury and the Office of the Special Inspector General for the Troubled Asset Relief Program, our pro bono law firm partners and others fighting foreclosure rescue fraud,” said Joe Rich, Fair Housing and Fair Lending project director for the Lawyers’ Committee. “It is the courage of the thousands who reported scams, and the dedication of the Network partners who are using this information to stop scammers and to prevent scams in the first instance, that make this 20,000 scam reports milestone so significant.”
Network Partners Recognize Milestone
“For more than two years, the Loan Modification Scam Alert campaign has focused on educating homeowners about scams and how to report them to authorities,” said NeighborWorks America CEO Eileen Fitzgerald. “This milestone shows that although homeowners are getting the message, we still have more work to do.”
“The Homeownership Preservation Foundation (HPF) is proud to partner with colleagues in the Loan Modification Scam Prevention Network to help distressed homeowners protect themselves from mortgage scam artists who prey on their financial vulnerability,” said Josh Fuhrman, Senior Vice President of Community Affairs for HPF. “While 20,000 reported cases is unquestionably a significant number, the calls we receive from homeowners via our national Homeowner’s HOPE™ Hotline at 888-995-HOPE suggests that it just may be the tip of the iceberg. We’ve received an alarming increase in the volume of calls from people worried that they’ve been scammed, making the work done by counseling agencies such as ours to thwart con artists and educate homeowners all the more critical to support.”
“Anyone who is attempting to scam a struggling homeowner should be stopped, exposed and prosecuted to the fullest extent of the law. We are pleased to participate in the Loan Modification Scam Prevention Network and congratulate the Lawyers’ Committee its leadership in helping homeowners,” said Jeff Hayward, Senior Vice President, National Servicing Organization, Fannie Mae.
“This is a significant milestone that highlights an important tool to help the public recognize and report mortgage modification scams,” said Senior Vice President Hollis McLoughlin, Freddie Mac. “We applaud the Lawyers’ Committee and our partners in the Loan Modification Scam Prevention Network for their ongoing efforts to help end these fraudulent practices.”
“Consumer education on the issue of loan scams has been a top priority for HOPE NOW. We have worked hard to get the message out to homeowners nationwide and we are so pleased that 20,000 at-risk families have reached out for help. This is a testament to the incredible collaborative efforts of all partners involved,” said Faith Schwartz, Executive Director of HOPE NOW.
Building Towards Future Milestones
In 2012, the Loan Modification Scam Prevention Network will continue to prioritize attacking fraud perpetrated against distressed homeowners through public education and prosecutions. For example, the Lawyers’ Committee will bring more legal cases and will publish research papers based on information from the Database. Distressed homeowners and concerned citizens who witness scam activity or think they have been scammed are encouraged to report that information to the Network in the year ahead.
To report a loan modification scam or other type of foreclosure rescue scam, go to preventloanscams.org. Victims can also get counseling help and submit scam reports by calling 888-995-HOPE (-4673).
About the Loan Modification Scam Prevention Network
The Network is an innovative public/private sector collaboration of local, state and federal housing and consumer advocates and law enforcement agencies. It is supported by the U.S. Department of Housing and Urban Development (HUD), the Open Society Foundation, Fannie Mae, Freddie Mac, J.P. Morgan Chase, Bank of America and Citibank.
About the Lawyers’ Committee
The Lawyers’ Committee for Civil Rights Under Law, a nonpartisan, nonprofit organization, was formed in 1963 at the request of President John F. Kennedy to involve the private bar in providing legal services to address racial discrimination. The principal mission of the Lawyers’ Committee is to secure, through the rule of law, equal justice under law, particularly in the areas of fair housing and fair lending, community development, employment discrimination, voting, education and environmental justice. For more information, please visit www.lawyerscommittee.org.