According to data complied by federal regulatory agencies, foreclosure scams have more than doubled since 2010. Complaints of these scams rose from 9,000 in 2009 to more than 18,000 each year in 2010, 2011, and 2012.
Increase in Foreclosure Scams
But why the significant increase? It seems that amongst other things, the investigates scams have become increasingly complex, now involving attorneys as well as legal bankruptcy code, thus making it harder to be enforced.
“Schemes involving attorneys—which tend to involve greater losses—had become more common in recent years following a regulation that bans upfront fees, but provides an exception for attorneys,” said Lawrance Evans, the Government Accountability Office director of financial markets and community investment. “These schemes present unique challenges because attorneys typically collect fees upfront and enforcement officials have difficulty trying to determine whether attorneys are providing legitimate services.”
It’s also been noted that specific minorities are being targeted: specifically minorities and the elderly. Complaints filed by black homeowners increased from 17% in 2010 to 24% in the first four months of 2013.
Financial Fraud Enforcement Task Force
The best way to stop these foreclosure scams is to get word out to consumers about how to avoid being victimized by these scams. The Financial Fraud Enforcement Task Force (FFETF) members have undertaken numerous actions to educate consumers through various outreach efforts.
If you are facing foreclosure it’s important to remember that it is illegal to charge up-front fees for foreclosure help. If you have been a victim of a foreclosure scam, you should work with an attorney that can help build your case and defend you in a court of law.
Source: Housingwire.com, Foreclosure rescue scam complaints more than double, October 30, 2013