Since the housing market crash and foreclosure crisis of 2008, mortgage-relief scams have escalated, keeping U.S. consumer protection agencies very busy. The Federal Trade Commission said Thursday that it has halted yet another scheme, this one allegedly operated by Philip J. Danielson and his company, Danielson Law Group.
The Utah-based operators of the scheme have settled FTC charges that they conned consumers into paying hefty fees for “worthless” mortgage relief, the U.S. agency said.
The proposed settlement bans Danielson and his company from offering mortgage assistance relief services and from participating in the debt relief industry.
“It’s troubling when anyone takes advantage of homeowners in financial distress,” said Jessica Rich, Director of the Bureau of Consumer Protection. “This scam is particularly offensive because it used an attorney’s legal credentials to create a facade of authenticity.”
The FTC filed its initial complaint in July 2014. The mortgage-relief operation charged consumers $500 to $3,900 by “falsely promising that attorneys would negotiate loan modifications that would substantially reduce the consumers’ mortgage payments,” the FTC said.
The FTC alleges that the mortgage-relief operators used the name “Danielson Law Group” and other attorney or law firm names to make it seem that they had lawyers all over the country, “even though many consumers never met or spoke to an attorney.”
The proposed settlement also imposes a $28.6 million judgment against all the defendants, reflecting the total amount of fees taken in by the scheme. The proposed judgment will be suspended, provided that defendants surrender some of their assets, including a $200,000 house in Utah.