Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: Mortgage relief services provider settles FTC charges over up-front fees, (Sep 3, 2015)
Organizations Mentioned:Wealth Educators, Inc.
By Linda O’Brien, J.D., LL.M.
A mortgage relief services company and its owner have agreed to settle allegations that they illegally charged homeowners an up-front fee for help they promised but never provided. Additionally, they will be banned from selling debit relief services under a federal court order, the FTC announced today (FTC v. Wealth Educators, Inc., File No. 152-3004).
In a complaint, filed in the U.S. District Court for the Central District of California on August 21, 2015, the FTC charged the defendants with failing to provide the help they promised homeowners, while charging a hefty up-front fee. The company also told consumers to stop making their monthly mortgage payments, leading some facing the prospect of foreclosure.
According to the complaint, the defendants used outbound telemarketing to pitch their programs to consumers. Many of the targeted consumers were homeowners in financial trouble, whom the company promised it could help by reducing their monthly mortgage payment, lowering their mortgage interest rate, or obtaining loan modification or restructuring. The defendants also used websites allegedly set up by Veronica Sesma, the owner and president of Wealth Educators, to advertise the supposed mortgage relief services.
The stipulated court order prohibits the defendants from making misrepresentations about any products or services, and financial products and services in particular, and from selling or otherwise benefitting from customers’ personal information. The order also imposes a $885,677 judgment that represents the total amount of fees taken by the scheme. It will be partially suspended upon surrender of funds in the frozen corporate bank accounts. The full judgment will become due immediately if the defendants are found to have misrepresented their financial condition.
Companies: Wealth Educators, Inc.
News: ConsumerProtection FederalTradeCommissionNews