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A federal court in California has temporarily shut down several companies owned by two men who federal and state regulators say were offering “sham mortgage relief” programs, costing consumers millions of dollars and, in some cases, their homes.
The Federal Trade Commission and the California Department of Financial Protection and Innovation (DFPI) together petitioned the court to close the numerous businesses operated under a variety of names by Dominic Ahiga and Roger Scott Dyer. The two men owned and operated the companies, which do business as Home Matters USA, Academy Home Services, Atlantic Pacific Service Group, and Golden Home Services America, among others, officials said.
In the first case to be brought jointly by the two agencies, the FTC and DFPI allege the companies charged consumers thousands of dollars with false promises they would negotiate with consumers’ mortgage lenders to alter their loans, the agencies said.
The complaint was filed in U.S. District Court for the Central District of California. On Sept. 14, the court entered a temporary restraining order against the defendants and froze their assets.
The individual defendants in this case are Ahiga and Dyer. The corporate defendants are Apex Consulting & Associates Inc., Green Equitable Solutions, Infocom Entertainment Ltd. Inc., and South West Consulting Enterprises Inc.
The FTC and DFPI complaint alleges the defendants have been deceiving consumers since at least June 2018 with false promises that they can negotiate lower interest rates or payments on their mortgages.
Investigators claim the defendants target distressed homeowners with deceptive claims in telemarketing calls, text messages, and online ads, often promising that in just three months, they can get consumers’ mortgages modified. In many cases, the complaint alleges, they claimed to be affiliated with government agencies or that their services were part of government COVID-19 assistance programs.
The complaint also alleges that, when consumers paid for the defendants’ services, they rarely, if ever, got the promised modifications, and instead were harmed by the scheme in numerous ways:
- Deceiving consumers about their services: The defendants, as part of the sales process, regularly misled consumers, saying they had a track record of success and were able to “beat the system,” officials said. The complaint alleges consumers would receive documents with bogus claims about specific changes to their mortgage, including lowered interest rates or payments, but the defendants regularly failed to deliver any meaningful benefit.
- Costing consumers money and harming their credit: The complaint alleges that while the defendants charged consumers, many of whom were already struggling with mortgage payments, hundreds or even thousands of dollars, the harms extended beyond that loss. In many cases, the defendants told consumers not to pay their mortgage while using their “services,” leading to many consumers facing late fees and significantly lower credit scores, the complaint states.
- Costing consumers their homes: According to the complaint, the defendants require consumers to sign “cease and desist” letters that are sent to their mortgage lender, requiring the lenders to communicate only with the defendants. By not receiving notices of missing payments or default even as they continue to pay defendants, some consumers have found themselves in foreclosure.
The complaint alleges the defendants’ practices violate numerous federal and state laws and regulations, including the FTC Act, the Mortgage Assistance Relief Services Rule, the Telemarketing Sales Rule, the COVID-19 Consumer Protection Act, and the California Consumer Financial Protection Law.
“At a time when millions of Americans were dealing with a pandemic and struggling to pay their mortgages, defendants preyed on consumers with false promises of mortgage assistance relief,” said Samuel Levine, director of the FTC’s Bureau of Consumer Protection. “We are excited to build on our relationship with California’s DFPI in this case and will continue to work with our state partners to shut down schemes that take advantage of consumers experiencing financial hardship.”
“Illegal mortgage relief assistance schemes prey on the most vulnerable homeowners and are a significant threat to the generational wealth that home ownership provides for consumers,” said DFPI Commissioner Clothilde Hewlett. “The DFPI has taken strong, decisive action against the companies behind this scheme using the California Consumer Financial Protection Law to put a stop to their illegal activities and protect not only California consumers, but also consumers nationwide.”