Federal Trade Commission v. Lake, et al., SACV15-00585-CJC (JPRx), U.S. District Court, Central District of California

Defendants in this FTC action are alleged to have operated loan modification businesses which unlawfully sought and accepted advance fees and deployed fraud and deception to lure in consumers. These operators used direct mail pieces designed to appear as official government mailings which promised consumers mortgage relief and directed them to an 800 number which was answered by telemarketers in Defendants’ call room. These Defendants, however, added a component of pure fraud to thinly disguise the advance fee – consumers were essentially guaranteed a loan modification if they sent their next four mortgage payments to a phony trust account controlled by Defendants who simply pocketed the money. We took over the call room and the processing location and thereafter terminated operations and shut down the sites. Preliminary Injunctions were entered in May, 2015 and Stipulated Final Judgments were ultimately entered as to all, but one, of the Defendants. Final Judgment was entered as to the last remaining Defendant after the Court granted the FTC’s motion for summary judgment.