Why aren’t foreclosure “rescue” fraudsters held accountable?

By Deborah Goonan, Independent American Communities


Here’s a well-written investigative report by the Center for Public Integrity. It features one particularly well-know attorney whose law firm made millions charging clients steep monthly fees to help them avoid foreclosure. The problem, according to state and federal regulators, including the FTC: Gennady Litvin engaged in a pattern of making false promises, and then not delivering the legal services he promised. Most of his clients ultimately lost their homes to foreclosure, despite having paid thousands in legal fees to Litvin and his associates for almost nothing in return.

The most maddening thing of all is that regulators seem unable to collect full restitution from fraudsters like Litvin, because there are so many avoidance loopholes.

Some say we should arrest these white collar criminals and put them in prison. But the problem is, a convicted thief cannot repay debts from a jail cell. Besides, all that fraudulently acquired cash is often sheltered somewhere, and it will still be available to unscrupulous con artists after being released from prison in a few months or a few years.

The best way to ensure accountability is to make sure that full restitution is not optional or negotiable.

What’s desperately needed are laws that:

  • preclude avoidance of paying court-ordered restitution by filing bankruptcy,
  • that prevent money laundering activity, in all its forms, and
  • that forbid sheltering of dirty money in off-shore accounts or real estate.



Kudos to the Fred Schulte at Center for Public Integrity. Keep up the good work.


Homeowners say foreclosure firm failed them
Brooklyn lawyer says he helped save people’s homes


Litvin is one of hundreds of lawyers and law firms nationwide that have participated in suspect foreclosure “rescue” schemes in the wake of the housing market crash nearly a decade ago, a Center for Public Integrity investigation found. State and federal authorities contend these plans typically have violated a range of legal ethics codes and consumer-protection laws. But while dozens of lawyers have been stripped of their licenses for running them, many others have paid little in penalties — even when desperate homeowners lost millions of dollars. Litvin is in “good standing” with the Florida Bar Association, which oversees lawyers in the state. He is not eligible to practice there, however, unless he completes 30 hours of continuing legal education required of all lawyers, officials said.

In New York, Litvin has “no record of public discipline,” according to the New York State Unified Court System.


Read more, and view an advertising video featuring Litvin:


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