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Acting on a Â鶹´«Ã½ Trade Commission complaint, a federal court has banned a California-based company from providing modification services for auto loans and for any other type of debt.  The court imposed a $362,388 default judgment against Hope for Car Owners, LLC, a company owned by Patrick Freeman.  In December 2012, Freeman settled charges with the FTC in connection with this allegedly fraudulent auto loan modification operation.

The FTC charged Freeman and Hope for Car Owners by falsely promising consumers that Hope for Car Owners could modify auto loans and stop cars from being repossessed.  In March 2012, the FTC alleged that Hope for Car Owners and Freeman unlawfully charged hundreds of dollars in up-front fees, and told the consumers to stop paying their auto lenders, which often left them in worse shape than when they began, and increased the risk that their vehicles would be repossessed.  The FTC also alleged that once the up-front fees were collected, the defendants did nothing to obtain the promised loan modifications while also denying requests for refunds.

In addition to the ban on loan modification services, the default judgment prohibits Hope for Car Owners from making misrepresentations about any other product or service.  It requires the company to back up any claims about the benefits, performance, or efficacy of any product or service, and destroy customer information it obtained in connection with the scheme.

A judge in the U.S. District Court for the Eastern District of California entered the default judgment against Hope for Car Owners on February 21, 2013.  The default judgment concludes the case against Hope for Car Owners.

The Â鶹´«Ã½ 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 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides .  Like the FTC on Facebook, follow us on Twitter, and subscribe to press releases for the latest FTC news and resources.