Federal Agencies Form Task Force to Combat Mortgage Modification Scams
December 6, 2011
The joint task force comprised of the Office of the Special Inspector General for the Troubled Asset Relief Program, the Consumer Financial Protection Bureau and the U.S. Department of the Treasury issued a consumer fraud alert to protect homeowners from HAMP-related mortgage modification scams.
The Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP), the Consumer Financial Protection Bureau (CFPB) and the U.S. Department of the Treasury announced the creation of a joint task force to combat scams targeted at homeowners seeking to apply for the Home Affordable Modification Program (HAMP).
SIGTARP, the CFPB, and Treasury have partnered to protect taxpayers by investigating and shutting down these scams and by providing education programs to vulnerable homeowners. The joint task force issued a consumer fraud alert to protect homeowners from HAMP-related mortgage modification scams. The fraud alert will also be provided directly to homeowners eligible for HAMP.
“The goal of our consumer fraud alert is to empower homeowners with the knowledge of how to recognize and avoid these scams,” said Christy Romero, deputy special inspector general for SIGTARP. “These scams prey upon the most vulnerable homeowners as they desperately hold out hope of saving their homes. SIGTARP, the CFPB, and Treasury want to make sure that homeowners know a scam when they see one and know where to turn for help. SIGTARP will work with the CFPB and Treasury in this joint task force and with other law enforcement partners to shut down these scams and to ensure that the perpetrators pay for their crimes.” SIGTARP, the CFPB, and Treasury investigate mortgage modification schemes, among other things, in which companies charge struggling homeowners a fee in exchange for false promises of lowering the homeowner’s mortgage debt or payments through HAMP, a foreclosure prevention program funded by the Troubled Asset Relief Program (TARP) and administered by the U.S. Department of the Treasury.
“Mortgage scams harm not only homeowners but legitimate businesses and the market as a whole,” said Richard Cordray, chief of enforcement for the CFPB. “By joining forces with SIGTARP and Treasury, the CFPB hopes to protect Americans and the integrity of one of the largest consumer financial markets in the U.S.”