BOSTON – A group of businesses that advertised themselves as nonprofit foreclosure-prevention organizations was sued for allegedly soliciting and spending more than $350,000 in illegal advance fees from distressed homeowners, Attorney General Martha Coakley announced this month.
Suffolk Superior Court Judge Frances McIntyre granted a preliminary injunction against the defendants, preventing them from soliciting or advertising for any foreclosure-related services or improperly charging advance fees, Coakley said in a statement.
The complaint alleges that since 2009 a group of five individuals operated a series of organizations claiming to offer financial and legal services, including foreclosure-related services, to distressed homeowners in Massachusetts. Organizations named in the lawsuit include the Alliance for Affordable Housing and the Global Advocates Foundation Inc., both located in Everett, as well as the Alliance for Hope Network Inc., in Framingham. Five individual defendants were also named.
According to the complaint, the defendants required homeowners to give deposits of up to 25 percent of their gross monthly incomes, claiming the deposits were necessary to be eligible for federal and other mortgage-relief programs. The complaint alleges that between March 2010 and October 2012, the defendants collected and spent more than $350,000 in deposits that they received from homeowners and claimed would be placed in escrow for the homeowners to use to help mitigate their pending foreclosure. •