RSSThe Consumer Financial Protection Bureau recently settled a foreclosure scam case by reaching a $12 million settlement with Consumer First Legal Group LLC.
According to the CFPB, Consumer First Legal Group and four attorneys — Harold Stafford, Jason Searns, Jeffrey Aleman and Thomas Macey — charged millions of dollars in illegal advance fees to homeowners for legal representation they promised but did not provide.
Under the agreement, the defendants are required to pay nearly $11 million in consumer redress and a $1.1 million penalty into the CFPB’s victims relief fund. In 2019, the U.S. District Court for the Western District of Wisconsin fined the defendants $59 million and permanently banned the defendants from providing mortgage assistance relief or debt-relief products or services, a ruling which the defendants appealed later that year.
The District Court reduced the fine to $29.2 million in 2022 and imposed an eight-year ban on all defendants except for Stafford, who faced a five-year ban on mortgage-assistance relief services. In August 2022, the defendants once again appealed, and the CFPB filed a cross-appeal the following month. The defendants remain covered by 5- or 8-year bans from the mortgage assistance industry under the court’s original order.
The CFPB originally filed a complaint against both the company and The Mortgage Law Group in July 2014. At the time, the bureau alleged that the groups violated Regulation O by taking consumer mortgage modification payments before they signed a mortgage modification agreement from their lender; failing to make required disclosures; directing customers not to reach out to lenders; and by making deceptive statements to consumers in providing mortgage assistance relief services.
In 2017, the District Court fined The Mortgage Law Group $39.15 million.
