AG- Kannapolis foreclosure ‘scam’ shut down
Published 12:00 am Saturday, December 5, 2009
A Kannapolis business that has promoted itself as helping homeowners avoid foreclosure has been temporarily barred from taking their money while the state seeks to permanently shut down what it calls a scam, the N.C. Attorney General’s Office said in a press release Friday.
Geoffrey Lamb cannot collect money from consumers for foreclosure assistance or loan modifications, Attorney General Roy Cooper said in a press release. On Wednesday, Wake County Superior Court Judge Donald Stephens approved Cooper’s request to temporarily bar Lamb from offering those services.
Lamb said Friday he has already stopped offering foreclosure assistance. He said his business “is not a loan modification company by trade,” but a real estate brokerage firm.
“We were assisting some clients, just on the side, on a nonprofit basis … to basically help them keep their houses instead of selling them, and we had a couple of people complain about it. Apparently, they got to the attorney general.”
According to Cooper’s press release, six homeowners have filed complaints about Lamb with the attorney general’s Consumer Protection Division. The Better Business Bureau of the Southern Piedmont said in a separate press release it has taken complaints about The Lamb Group from 10 consumers in as many different states, with nine of those complaints filed in the past six months.
The Lamb Group has used two addresses, according to the Better Business Bureau ó 6001 Gateway Center Drive, Suite 105, Kannapolis, and 2630 Lansing St. NW, Concord. In the suit filed last week, Cooper said Lamb also did business as US Consumer Solutions. Cooper said his suit also seeks consumer refunds and civil penalties.
“Scammers entice struggling homeowners with false promises of lower mortgage payments, then do little or nothing to help them,” Cooper said. “We’ve made it illegal to take money up front for foreclosure or loan modification help, and we’re cracking down on violators.”
The complaint says Lamb stated on his Web site that his firm was a “non-profit foreclosure relief organization” with a “success rate of 97 percent.” However, the complaint alleges Lamb charged homeowners an up-front fee of as much as $1,500, told them not to contact their mortgage lenders, and then did little or nothing to help save their homes.
Under North Carolina law, it’s illegal to charge an advance fee for foreclosure assistance or loan modifications.
Cooper contends that Lamb promised a full refund if a consumer’s lender did not offer to rework their loan. The complaint alleges Lamb failed to get loans modified but still refused to give consumers their money back.
Several people who paid Lamb for foreclosure relief filed affidavits with the attorney general’s complaint, the press release said. One of them says a 73-year-old cancer survivor and his wife struggled to make mortgage payments on their Forsyth County home. The Lamb Group assured the homeowner that it could cut his monthly payments by $300 in exchange for an up-front payment of more than $1,200.
After waiting months with no results, the homeowner asked for his money back. So far, the press release said, The Lamb Group has refused. A few days after requesting a refund, the homeowner got an e-mail from Lamb’s other firm, US Consumer Solutions, offering to modify his mortgage for $495.
“For a struggling homeowner, the mortgage foreclosure ‘rescue’ service seems to be the answer to the homeowner’s worst nightmare,” said Tom Bartholomy, president of the Better Business Bureau. “The problem is that these companies are violating N.C. law.”
Lamb said Friday that he was “unaware of some of the rules they have in North Carolina” about loan modification and foreclosure relief offers, but that he is “going to Raleigh next week to get it all worked out.”
He contends struggling homeowners were told they would get a refund of their payments to his business only if the banks refused to modify their loans. Some wanted refunds because they were unhappy with the offers the banks made, he says, and they complained when he didn’t return their money.
“One of the issues we couldn’t have foreseen is their concerns with results they received from the bank,” he said. “They were educated. We’re still helping people in the system, but we’re out of that business. … It’s too difficult to manage.”
Lamb said his business has “been helping these individuals out, and we’re really proud of the assistance we’ve been able to offer.”
The state and the Better Business Bureau, however, allege that Lamb was only helping himself. The Better Business Bureau gives his business a rating of “F” and the press release from Cooper’s office said the case against Lamb is part of a national crackdown on foreclosure rescue and loan modification scams brought by 26 federal and state agencies.
“Never, ever pay money up front to anyone who claims they’ll help you with foreclosure,” Cooper said in the press release. “Real help is available for free from qualified nonprofit counselors.”
North Carolina homeowners can call a toll-free hotline set up by the N.C. Commissioner of Banks’ office for free counseling on options to avoid foreclosure. The hotline, 866-234-4857, is available from 8 p.m. to 9 p.m. Monday through Friday, and from 8 a.m. to 5 p.m. on Saturdays.
Tips on how to spot a foreclosure scam are available on the Attorney General’s website, www.ncdoj. gov.