Mortgage Fraud: The Scams That Hit You Where You Live

Mark Mandell, Esq.

Mortgage fraud is one of the hardest-hitting scams in the US, and it threatens the dream of homeownership for all too many people. Michigan is among the top states for known or suspected mortgage fraud activity, based on recent law enforcement and industry data.

These scams are especially tricky to combat, as they readily adapt to economic changes and adjustments in lending practices. Mortgage fraud comes in a few forms, primarily: predatory lending, criminal mortgage fraud, and foreclosure rescue scams.

Predatory lending is essentially unfair and deceptive practices on the part of lenders during the loan application process. This can included misleading marketing tactics and incentives for selling risky loans. Recently in Michigan, Countrywide Financial and Ameriquest Mortgage Company settled cases with the state’s Attorney General’s Office worth over $130 million and $13.8 million respectively, providing restitution to consumers.

Criminal mortgage fraud involves the use of artificially inflated appraisals and straw buyers to gain mortgages greater than the property value. The criminals take the extra money from the mortgage and leave the straw buyer out to dry with a mortgage they cannot afford and property worth far less than the mortgage amount.

Lastly, foreclosure rescue scams exploit consumers at times when they are most vulnerable – when they and their families may be forced out of their homes. These “foreclosure rescue companies” take up-front payments to “work with your lender,” and most never deliver on their promise. In Michigan, the Credit Services Protection Act made it illegal, in most cases, to take money up front in exchange for negotiating with your lender. The CSPA is enforced by the Attorney General’s Office, and you can watch out for their consumer alerts on foreclosure scams here: http://www.michigan.gov/ag/0,4534,7-164-17337_20942-215058--,00.html

So how do you avoid mortgage fraud as a consumer? Some steps may require more work at the outset, but they will save you future aggravation and distress from potential fraud. First, seek out referrals for real estate and mortgage professionals when you want to buy or sell a home – and once you are referred, do your homework on them. Also, do your homework on what other homes in the area have sold for.

If it sounds too good to be true, it probably is: Beware of “no money down” loans. These loans are meant to trick people into buying homes they really can’t afford. Therefore, also know your own price range and have an idea going in of what you truly can afford both up front and in the medium and long-run. And finally, don’t let the realtor or mortgage broker force you to make false statements or sign your name to blank documents or documents with empty lines – these are sure signs of potential scams.

For more information on how to protect yourself as a consumer from mortgage fraud, check out the FBI’s website, here: http://www.fbi.gov/news/stories/2008/august/mortgagefraud_081408; and the Michigan AG’s consumer alert website: http://www.michigan.gov/ag/0,4534,7-164-17337_20942-215058--,00.html.

You can read the entire article at:

https://www.michigan.gov/documents/ag/Attorney_Generals_Office_Fights_Predatory_Lending_346680_7.pdf

If you have questions about mortgage fraud or other legal issues, please contact Mark Mandell or Tariq Hafeez at 248.380.0000 or online at www.MichiganFraudLawyer.com.

Increased Police Patrolling During the Holidays

Mark Mandell, Esq.

According to the Michigan State Police, law enforcement officers in 26 counties will be conducting extra patrols through the New Year to ensure motorists are driving safe and sober this holiday season. According to the Michigan State Police website, 11 people were killed in crashes on Michigan roadways; four of those crashes involved alcohol.

The holidays are a very busy time for travel and officers will be making sure that everyone gets to their family gatherings safely. According to OHSP Director Michael L. Prince, "Extra officers will be out strictly enforcing drunk driving laws. Motorists need to designate a sober driver before drinking or take a cab or bus home."

Not only is drunk driving extremely dangerous, but there are hefty consequences associated with drunk driving. A person is considered “over the limit” if they are operating a vehicle with a BAC of .08 or greater. There are enhanced penalties if an individual’s BAC is 0.17 or higher. The severity of the penalties depends on what number offense it is and the level of intoxication. The penalties include the following:

·         If BAC is below .17 and it is a first offense the penalties includes up to a $500 fine and Up to 93 days in jail;

·         If BAC is above .17 and it is a first offense the penalties includes up to a $700 fine and 180 days in jail;

·         If  it is a second offense within 7 years the penalties include one or more of the following: a $200 to $1000 fine and/or 5 days to 1 year in jail;

·         If it is a third offense within a lifetime the offense is considered a felony and the penalties include one or more of the following: a $500 to $5000 fine, 1 to 5 years imprisonment and/or probation with 30 days to 1 year in jail;

·         Additionally, convicted drunk drivers are subject to a $1,000 penalty for two consecutive years under the Driver Responsibility Act, for a total of $2,000 in additional costs.

There are a number of safer alternatives to drunk driving. Safer alternatives include: designating a sober driver; calling a friend; taking a cab; walking or staying over the night at a family or friend’s home. If you are facing drunk driving charges, or have questions regarding the law, contact experienced criminal defense attorney Mark Mandell at 888-674-1189 or online at www.MichiganFraudLawyer.com.

‘Tis the Season for Retail Fraud

Mark Mandell, Esq.

 

As the holiday season nears, retail fraud is expected to skyrocket. Last December, the National Retail Federation estimated retail fraud’s annual cost at $8.9 billion, according to a survey of 60 retail firms. Of that amount, $2.9 billion will come during the holiday season. The holiday season can be difficult on families who may not be able to afford the types of gifts they would like to give their loved ones. For this reason, individuals in this predicament may feel the need to commit retail fraud. Although, this may be a difficult time for many families, the penalty of retail fraud is too severe and the risk is too high. Since the consequences of retail fraud are hefty, quality legal representation is a necessity.

There are three degrees of retail fraud: first degree, second degree and third degree. The difference in degrees of retail fraud depends on the benefit wrongfully received. If the benefit wrongfully received is $200.00 or less, the crime would be considered retail fraud in the third degree, a misdemeanor. If the benefit wrongfully received is more than $200.00 but less than $1000.00, the crime would be considered retail fraud in the second degree, a misdemeanor. If the benefit wrongfully received exceeds $1000.00, the crime would be considered retail fraud in the first degree, which is a felony.

Retail fraud can take a variety of forms such as taking property from the store that has not been paid for; returning items to the store as a refund or exchange for property that was not paid for and misrepresenting the price of an item with intent not to pay for the item or pay less than the price at which the property is offered for sale.

Retail fraud is governed by statute-MCL §750.356. MCL §750.356c provides that any person who commits retail fraud in the first degree is punishable by imprisonment for not more than 5 years or a fine of not more than $10,000.00 or 3 times the value of the difference in price, property stolen, or money or property obtained or attempted to be obtained, whichever is greater, or both imprisonment and a fine. MCL §750.356d provides that any person who commits retail fraud in the second degree is punishable by imprisonment for not more than 1 year or a fine of not more than $2,000.00 or 3 times the value of the difference in price, property stolen, or money or property obtained or attempted to be obtained, whichever is greater, or both imprisonment and a fine. MCL §750.356d provides that any person who commits retail fraud in the third degree is punishable by imprisonment for not more than 93 days or a fine of not more than $500.00 or 3 times the value of the difference in price, property stolen, or money or property obtained or attempted to be obtained, whichever is greater, or both imprisonment and a fine.

The harsh penalties of retail fraud make having experienced and knowledgeable legal counsel invaluable.  If you have been charged with retail fraud, contact attorney Mark Mandell at (248) 380-0000 or online at www.MichiganFraudLawyer.com. 

False Claims Act

Mark Mandell, Esq.

 

The False Claims Act has recovered approximately $18.3 billion dollars for the federal government from 2008 through 2012. For every dollar the government invests in fighting healthcare fraud, the government gets $16 dollars in return.

The False Claims Act is a Civil War era law, dating back to 1865. The Act is meant to fight companies who defraud governmental programs. People that are not affiliated with the government are also allowed to file actions on behalf of the government; this is known as “whistleblowing”. Whistleblowers can receive up to 15-25% of recovered damages. 

In the past two years, there has been a tremendous increase in healthcare fraud cases. For example, in 1987-1992, there were only 62 healthcare fraud cases filed by “whistleblowers”. The number of cases in 2011 and 2012 add up to 829 cases.

Supporters of The False Claims Act explain that this revenue actually returns a large amount of money to U.S. tax payers. The report from the Washington based group, D.C.-based Taxpayers Against Fraud, states that this revenue can fund the entire Children's Health Insurance Program, serving more than 5 million people, for approximately four years.

 

Although, there are many supporters of the act, there is also some opposition. For example, the U.S. Chamber of Commerce believes that this act needs a lot of reform to encourage companies to try to fix the fraud issue internally. Penalties for healthcare fraud are actually three times the amount of the actual damages and the Chamber of Commerce explains that these penalties are handed out without any due process. The Chamber of Commerce explains that these penalties are too harsh and this makes companies less likely to come forward and ask for help in solving their issues with internal fraud. For example, the Chamber of Commerce thinks a good idea for reform would be to create benefit incentives for companies who create in house programs against fraud.

Healthcare fraud continues to be a serious problem and initiatives to fight healthcare fraud continue. For more information please read:

http://www.beckershospitalreview.com/legal-regulatory-issues/u-s-recovers-16-for-every-1-it-spends-fighting-civil-healthcare-fraud.html

http://www.mainjustice.com/2013/10/23/u-s-chamber-of-commerce-proposes-false-claims-act-reforms/

Michigan to Receive $42 Million in Nationwide Healthcare Fraud Settlement

Matthew Worley, Esq.

 

Johnson & Johnson and its subsidiaries have agreed to pay more than $2.2 billion to the federal government and 45 states in one of the largest health care fraud settlements in history.

 

The payment is made to settle criminal fines and civil suits alleging the entities offered kickbacks to doctors and pharmacies to promote certain drugs for uses not approved by the FDA – a practice prohibited under U.S. law.

Allegedly, the health care giant promoted the use of schizophrenia drugs for use in elderly dementia patients and for children with AD/HD, autism, and other disorders.  These drugs were not approved for these uses, making it illegal for the manufacturer of the drug to market them.

Michigan’s share of the settlement, which is approximately $42 million, will primarily go to the state’s Medicaid program which initially paid for most of these prescriptions.  According to Michigan Attorney General Bill Schuette, this major settlement makes a statement that the hardworking taxpayers of Michigan deserve better than to be duped into paying more than they should have.

Under a “Corporate Integrity Agreement,” the federal government will be closely monitoring the company’s marketing practices going forward.

If you have questions about health care fraud, or are afraid that you may have been the victim of a fraud, contact the experienced attorneys at Fausone Bohn, LLP, by calling (248) 380-0000 or online at www.MichiganFraudLawyer.com. 

To read the original article detailing this health care fraud settlement, visit: http://www.mlive.com/business/index.ssf/2013/11/michigan_johnson_johnson_drug.html

Seniors Beware of Telemarketing Fraud

Mark Mandell, Esq.

Senior citizens and grandparents have been a major target for telemarketing and telephone scams in Michigan. Unfortunately, as Glenn Clark, a repre­sentative of the Michigan Attorney General Bill Schuette’s Consumer Protection Division explains, “if you’re a senior, God bless you, but you have a bull’s-eye on your back for these telemarketing frauds.”

Mr. Clark, keynote speaker at the annual Monroe County Elder Justice Sum­mit held Thursday, said 56 to 80 percent of all telemarketing fraud is aimed at seniors but telemarketing fraud is not the only type of fraud that takes place over the phone. Another common scam aimed at senior citizens is the “emergency situation” scam.

Unfortunately, scammers find the names of their victims from public documents or other sorts of data mining. When the scammers locate their victims, they call the senior citizen pretending to be a relative in distress. The scammers explain to the targeted senior citizen that they are in a medical, legal, or any other type of emergency to acquire funds. The scammer makes sure the senior believes that they are, for example, a grandchild that needs immediate help.

Because senior citizens and grandparents are older in age, may have a hard time hearing over the phone, and are not used to telephone calls, they often do not realize that the person on the line is not their family member.

Mr. Clark further explains that the scammers try to appeal to some kind of emotional bond and “they want you to act emotionally and not logically.”

In order to prevent these types of situations Mr. Clark advises to try to verify who that individual is through quizzing them on personal details or calling relatives to verify that the individual is really in trouble.

If you have faced this type of situation or have any questions regarding these types of issues contact Michigan fraud attorney, Mark Mandell at 888-674-1189 or online at www.MichiganFraudLawyer.com

Read more at: http://www.monroenews.com/news/2013/oct/15/scammers-target-grandparents/

Last Call for Alcohol at 4 a.m.?

Mark Mandell, Esq.

 

Many individuals and law enforcement officials are concerned with Senate Bill 247 which would allow bars and restaurants in cities' central business districts to sell alcohol until 4 A.M. with a special permit.

Those opposing the bill are concerned with potential health and safety implications. One of the main concerns with extending the time to sell alcohol is drunk driving. There were several posts made on the MLive Facebook page that show why many people are concerned with this bill. Thomas Donnely, a Michigan citizen, posted "I am against this proposal. People leaving bars at 4:00 AM will endanger those going to work in the early AM." This is only one of many comments posted against Senate Bill 247.

Although there are a lot of individuals against the bill, there are many who support the bill as well. Supporters explain that longer hours would help create jobs for bartenders and create more wages for taxi drivers. A supporter of the bill, Roy Munson, posted on the MLive Facebook page that the hours "should be up to the bars. We don't need the government telling anybody what to drink and when. People need to be responsible."

MLive conducted an informal poll and found that 57 percent of the nearly 800 poll takers would support the bill, including those who want it extended to all areas, not just cities' central business districts, and those who would only support it if the local municipality opts in. 43 percent of poll takers opposed the bill and agreed with the saying that “Mama always said ‘Nothing good happens after midnight.’”

If you have questions about drunk driving laws in Michigan, contact criminal defense attorney Mark Mandell at 248-380-0000 or online at www.MichiganFraudLawyer.com. 

 

For more information please read:

http://www.mlive.com/business/index.ssf/2013/10/4_am_last_call_for_alcohol_som.html