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FTC to Collect $2.2M from Banned Loan Mod Companies

By: Heather Hill Cernoch

The Federal Trade Commission (FTC) reached a settlement this week with two companies and three individuals, who are now banned from the mortgage relief services business and must pay $2.2 million in assets for consumer refunds.

The FTC filed the proposed consent order in the U.S. District Court for the Southern District of Florida.

As part of its efforts to thwart scams targeting homeowners seeking mortgage relief, the FTC alleged in

November 2009 that Kirkland Young LLC and its manager, David Botton, misrepresented themselves as consumer mortgage lenders, servicers, or their affiliates.

According to the FTC, they falsely promised to modify consumers’ loans and make their mortgage payments more affordable. The FTC added Botton’s sister, April Botton Krawiecki, their father, Samy Botton, and Attorney Aid LLC as defendants in December 2009.

The settlement also permanently prohibits these companies and individuals from misleading consumers about financial-related goods and services and bars the defendants from selling or disclosing customers’ personal information.

The FTC did not allege any violations of the Mortgage Assistance Relief Services Rule in this case because the defendants’ claims predated the rule.

The rule bans providers of mortgage foreclosure rescue and loan modification services from collecting fees until homeowners have a written offer from their lender or servicer that they decide is acceptable.