Las Vegas Sun

February 12, 2012

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AG announces campaign to fight foreclosure scams

By Dylan Scott

Tuesday, Aug. 17, 2010 | 1:45 p.m.

Click to enlarge photo

Catherine Cortez Masto

Nevada’s foreclosure pandemic has attracted a slew of scam artists hoping to take advantage of homeowners desperate to avoid losing their homes. In response, Nevada Attorney General Catherine Cortez Masto on Tuesday announced a new public awareness campaign to help citizens spot fraud and point them toward legitimate businesses.

At a Tuesday news conference, Cortez Masto, along with Las Vegas Ward 6 Councilman Steven Ross, introduced the Stop Foreclosure Fraud initiative and website, StopNVForeclosures.org. Homeowners can fill out an online form and request assistance from counseling agencies approved by the U.S. Department of Housing and Urban Department.

Cortez Masto rattled off a list of statistics to illustrate the crisis: Her office has received complaints against more than 200 companies, opened 14 cases in criminal court, obtained five felony convictions and sent 51 cases to civil courts, she said.

The plan now is to catch the problem before it expands, she explained.

“The most effective tool against these fraudsters is an alert and well informed public,” Cortez Masto said. “From a law enforcement perspective, we would much rather have prevention and education on the front end.”

Nevada topped the U.S. in foreclosures with more than 13,500 in July. In Las Vegas, one in 71 homeowners, more than five times the national average, faced foreclosure last month.

One common scam happens when a company requires a large down payment and then sends the homeowner a small refund after completing no work — called an automatic refund scam.

Or, a company will guarantee to reduce a homeowner’s principal on a mortgage as a marketing ploy. In other instances, a company will pledge that, if the homeowner sells the house to a group of investors, they will sell it back with a reduced mortgage — called a “phantom investor scam.”

Officials advised citizens to be wary of any business that make guarantees or pressures them to sign and pay.

"If they ask you to pay, walk away," said Zeeda Danielle, senior deputy director at Fannie Mae, whose company supplied a grant to fund the program.

Cortez Masto reminded homeowners that many reputable counseling agencies exist, and the purpose of the Stop Foreclosure Fraud program is to direct them to those services. The task force that developed the program included government officials, counseling agencies and financial firms.

Homeowners also can call (702) 229-HOME for assistance.

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