5 More California Lawyers Brought to Justice for Loan Mod Fraud

The State Bar of California created the Loan Modification Task Force to combat loan mod scam artists in April 2009. Some background: As the housing meltdown worsened, it became more and more common for scammers to take homeowners' money in exchange for a guaranteed loan modification. Within weeks or months the scammers would disappear without a trace, and homeowners would find that little to no work had been done on their mortgage. In fact, many homeowners would learn they were scammed when the banks initiated foreclosure proceedings against them.

Although recent developments in California law that purport to help homeowners may serve a counter (such as SB-94, see below), the Loan Modification Task Force ("LMTF") gets down and dirty to stop scammers. The LMTF has been successful in exterminating a number of illegal operations; approximately 20,000 attorney files have been removed from the offices of attorneys whose loan modification scam shops have been shut down.

It is recently reported in the California Bar Journal that 5 more attorneys have been exposed and prosecuted. Their practices, located in Los Angeles and Orange County, falsely promised unsuspecting homeowners loan modifications that would allow them to remain in their homes. These attorneys, ranging in age from 34 to 75, have either resigned or been placed on involuntary inactive enrollment. ("Resigned" does not mean retain its traditional meaning here; in this context, it means that the attorney will not be able to practice law in California).

So what can we take away from all of this? For one, the LMTF is achieving success in helping rid Southern California of the leeches we know as loan mod scammers. More importantly, though, is this helpful tip for anyone considering retaining an attorney. Do your research and check their membership record. You can easily access an attorney's disciplinary record by going to www.calbar.gov and clicking on the "Attorney Search" link on the right-hand side of the website. It takes minutes to do and can save you countless hours and thousands of dollars.