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SoCal Men Scam Homeowners, FTC Says

WASHINGTON (CN) - Three California men are scamming distressed homeowners by using an official-sounding name and a Pennsylvania Avenue address to charge thousands of dollars for foreclosure "services" they do not provide, the FTC says in Federal Court. The Federal Housing Modification Department is not a government program, but a scam run by three men in San Marcos, Calif., the FTC says.

The scam also uses the names Nations Housing Modification Center and Loan Modification Reform Association, the FTC says. Defendants Michael Trap, Glenn Rosofsky and Bryan Rosenberg run the game out of San Marcos, a wealthy northern suburb of San Diego, according to the complaint.

The men use company Web sites, telemarketing and direct mail solicitations through a mailing address on Pennsylvania Avenue in Washington, D.C. - down the street from the White House.

Their pitch letter, which they call a "Final Entitlement Notice," claims that "Your modification case has been assigned to the following processing center: Nations Housing Modification Center," and claims that Congress passed a bill that "allows the Nations Housing Modification Center (NHMC) to provide relief for homeowners that are delinquent on their mortgage through the National Home Affordable Modification Program."

They also advertise bogus debt relief services through a Web site that lists a toll-free number, the complaint states. Telemarketers field calls and claim they have "a team of attorneys and forensic accountants working around the clock," though the company has neither on staff, the FTC says.

The defendants tell consumers they get 200 calls they get a day but only 25 percent qualify for their program, which is nonsense, the FTC says, as "all or virtually all consumers who initially contact defendants are declared pre-qualified."

The telemarketers extract financial information over the phone and charge $2,500 for a one-time payment, or two payments of $1,500, the FTC says. As is typical in such scams, when they get the money they the consumer to stop communicating with the lender, as it may interfere with their "attorney negotiations," according to the complaint.

The man claim, falsely, that more than 90 percent of their clients get the promised mortgage modifications, which is not only untrue in itself, but simply making the claims violates a telemarketing rule, the FTC says.

The FTC says the company is in no way affiliated with the government, despite what its name suggests.

The FTC seeks an injunction, disgorgement of ill-gotten gains, refunds, and rescission of the bogus contracts.

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