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The operators of a mortgage foreclosure “rescue” company will be banned from selling mortgage relief services under a settlement with the �鶹��ý Trade Commission and the states of California and Missouri, which sued them in 2009 as part of a federal-state crackdown on mortgage loan modification and foreclosure relief scams.

Boasting a “proven track record” and the “highest standards of business ethics,” U.S. Foreclosure Relief Corp., George Escalante, Cesar Lopez, and Adrian Pomery falsely claimed they helped 85 percent of their clients get their loans modified, and that they would get loan modifications to make consumers’ homes much more affordable, according to the FTC complaint. They also allegedly violated state laws against charging advance fees for foreclosure consulting services. The court immediately barred the practices and froze the defendants’ assets.

The FTC has added as defendants H.E. Servicing, Inc., Brandon L. Moreno, and his law firm, Cresidis Legal, and charged all of the defendants with two more law violations: falsely claiming a lawyer would negotiate the terms of consumers’ home loans, and falsely promising refunds if they failed. The settlement order resolves the case against the original defendants and H.E. Servicing. The case continues against Brandon L. Moreno and Cresidis Legal, a professional corporation.

In addition to banning the settling defendants from selling mortgage loan modification and foreclosure relief services, the order prohibits them from making misrepresentations about financial goods and services, such as loan terms, ability to improve someone’s credit history, and how much a consumer will save by enrolling in a debt relief service. The order also bars the defendants from making misrepresentations about any good or service, such as refund terms, government affiliation, and total cost, and from violating the FTC’s Telemarketing Sales Rule. Finally, the order bars the defendants from enforcing any contracts with their customers, and selling or otherwise disclosing customers’ personal information.

The order imposes a $8.6 million judgment against George Escalante and his two companies, U.S. Foreclosure Relief and H.E. Servicing. The judgment will be suspended except for $980,000 in cash, jewelry, and vehicles that Escalante and his companies have surrendered to lenders or the court-appointed receiver, including a 2007 Cadillac Escalade, a 2008 BMW sedan, a 2007 Mercedes-Benz SUV, and a 2009 Toyota Tundra truck. For information about refunds to victims, please visit the court-appointed receiver’s Web site, . The order imposes $3.3 million and $3.4 million judgments against Cesar Lopez and Adrian Pomery, respectively, which will be suspended due to their inability to pay. The full amount will become due immediately if they are found to have misrepresented their financial condition.

The Commission vote to authorize staff to file the amended complaint and settlement was 4-0. The documents were filed in the U.S. District Court for the Central District of California. The case number in the District Court is SACV09-768.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe”
that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendants have actually violated the law. Stipulated court orders are for settlement purposes only and do not necessarily constitute an admission by the defendants of a law violation. Stipulated orders have the force of law when signed by the judge.

The �鶹��ý Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 1,800 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.