October 27, 2021
The Court entered an Order for Permanent Injunction and Monetary Judgment (“Final Judgment”) as to the Receivership Entities and Individual Defendants on December 5, 2019. The Individual Defendants, Sandra and Jonathan Hanley, appealed the order of Final Judgment, and that appeal is pending before the Ninth Circuit Court of Appeals. However, none of the Receivership Entities appealed the Final Judgment.
Having completed his duties as to the Receivership Entities, on October 6, 2021, the Receiver filed his Final Report and Application for Discharge and Approval of Final Fee Application. The Court entered its Order discharging the Receiver and approving his final fee application on October 12, 2021, thereby releasing and exonerating the Receiver from all further duties, liabilities, and responsibilities as Receiver, other than his obligation to maintain possession of the Receivership Entities’ business records until the conclusion of Sandra and Jonathan Hanley’s appeal.
The funds that the Receiver had acquired through Receivership Entities’ frozen accounts and the liquidation of assets have been turned over to the FTC. If the FTC implements a consumer redress program, the information will be available at the FTC’s website (https://www.ftc.gov/enforcement/cases-proceedings/refunds). The FTC’s website also has a section on how the FTC provides refunds (https://www.ftc.gov/enforcement/cases-proceedings/refunds/how-ftc-provides-refunds).
May 4, 2021
Jonathan and Sandra Hanley’s appeal of the U.S. District Court’s Judgment is still pending before the Ninth Circuit Court of Appeals. Until the appeal is dismissed or decided, the FTC cannot conclude the case. However, the Receiver’s duties are close to being complete and the appeal does not involve any of the Receivership Entities. We anticipate resolving the few outstanding issues related to the AHL Loan Portfolio in the near future and will then apply to the Court to be discharged and file our final report and fee application. After payment of the final fee application, the remaining funds will be turned over to the FTC.
June 16, 2020
After an unsuccessful appeal, the U.S. Court of Appeals for the Ninth Circuit affirmed the district court’s granting the Preliminary Injunction against Defendants Jonathan Hanley and Sandra Hanley. In December 2019, the district court granted the FTC’s motion for summary judgment and entered judgment in the amount of $18,428,370 against the defendants. Individual Defendants Jonathan Hanley and Sandra Hanley have filed notices of appeal.
The district court authorized the Receiver to sell an office building in Sandy, Utah, a residential condominium in Park City, Utah, and three automobiles and one camping trailer, all of which were owned by Receivership Entities. Defendant Jonathan Hanley filed a notice of appeal of that ruling. Hanley’s appeal was later dismissed and the Receiver sold the three automobiles. The camping trailer remains listed for sale.
On October 9, 2019, the district court approved the sale of the Park City condominium for $1.9 million. However, once again, Defendant Jonathan Hanley filed a notice of appeal. After the appeal was dismissed for failure to prosecute in March 2020, the sale of the Park City condominium was completed.
As for the Sandy office building, the payoff demand from the secured lender exceeded the highest purchase offer received. Rather than litigating, the Receiver and secured lender reached a settlement, which the district court approved over Defendant Jonathan Hanley’s opposition. Ultimately, the Receiver transferred the Sandy office building to the secured lender by deed in lieu of foreclosure.
The Receiver anticipates completing the receivership duties in the next six months and will file a motion for discharge.
November 15, 2018
After the Court entered the Preliminary Injunction, Defendants Jonathan Hanley and Sandra Hanley appealed to the U.S. Court of Appeals for the Ninth Circuit. Oral arguments were held on September 14, 2018.
The Court entered the Preliminary Injunction and Monetary Judgment against Defendant Benjamin Horton. The Order bans him from advertising, marketing, promotion, offering for sale, selling, or assisting others in the advertising, marketing, promotion, offering for sale, or selling, of any secured or unsecured debt relief product or service. He is also prohibited from making misrepresentations relating to financial products and services and unsubstantiated claims.
Notice to Customers: Responses to Frequently Asked Questions
The Receiver’s office receives questions from consumers on various subjects. Rather than respond to each inquiry separately, we have prepared a list of Frequently Asked Questions (“FAQs”) which addresses these questions. Click on the FAQs link on the Documents section of this page to access. The most recurring questions relate to what should consumers do now and whether refunds will be available – these questions are addressed in the FAQs.
February 26, 2018 – Update
The Court held the Preliminary Injunction hearing on February 15, 2018. After hearing argument, Judge Mahan in the U.S. District for the District of Nevada granted the FTC’s motion for a Preliminary Injunction. A copy of the Preliminary Injunction is available in the Documents section of this website. The Preliminary Injunction confirms Mr. McNamara’s appointment as Receiver and he will continue to act in that capacity. We are reviewing Defendants’ financial records to identify assets and potential clawback targets.
Notice Regarding FTC Lawsuit
The companies listed below have been sued by the Federal Trade Commission (“FTC”) for practices related to their loan modification business.
The FTC’s lawsuit was filed on January 8, 2018, naming as Defendants all of the companies listed below, along with their principals. The Court entered a Temporary Restraining Order (“TRO”) on January 10, 2018, which prohibits unlawful conduct and appoints a Temporary Receiver to take possession and control of these businesses. The Temporary Receiver has suspended operations and is conducting a review of the businesses.
Copies of the FTC’s Complaint and the TRO can be accessed under the Documents section of this website.
Companies named in the FTC’s lawsuit:
AM Property Management, LLC;
American Home Loans, LLC;
American Home Loan Counselors;
Brown Legal, Inc.;
Consumer Defense, LLC (NV);
Consumer Defense, LLC (UT);
Consumer Defense Group, LLC, f/k/a Modification Review Board, LLC;
Consumer Link, Inc.;
FMG Partners, LLC;
Preferred Law, PLLC; and
Zinly, LLC
Individuals named in the FTC’s lawsuit:
Jonathan P. Hanley;
Benjamin R. Horton; and
Sandra X. Hanley
At least until the date of the Preliminary Injunction hearing, presently set for February 15, 2018, these companies will have very limited operations. At that hearing, the Court will determine whether a Preliminary Injunction should be entered, which would extend the restrictions in the TRO until there is a trial of the case.
We recommend that you immediately contact your lender directly, a lawyer in your local jurisdiction with expertise in loan modifications, or HOPE NOW (http://www.hopenow.com/) or Homeownership Preservation Foundation (https://995hope.org/). HOPE NOW is an alliance of mortgage companies, HUD-approved counseling agencies, and other mortgage market participants. Homeownership Preservation Foundation is a non-profit member of the HOPE NOW alliance and operates a 24/7 toll-free hotline 888-995-HOPE (4673). A list of contact information for mortgage companies is available at http://www.hopenow.com/mortgage-directory.php.
Your best source of information is the Receiver’s website. We will post regular updates. If you have additional questions, please sent to info@regulatoryresolutions.com.
Notice to Employees
The Receiver has suspended all operations at least until the Preliminary Injunction hearing, presently set for February 15, 2018. All of Defendants’ assets have been frozen, so there are no funds available at this time for any payments to employees or other creditors of the Defendants. The TRO which appointed the Receiver also prevents any payment of pre-receivership debts without the Court’s prior authorization. In short, there are no present procedures for payments to employees. Whether and to what extent payments may be made to employees in the future is a subject for future resolution by the Court.