Tempe and Glendale Attorney General (AG) Offices settled lawsuits earlier this month in two mortgage fraud cases. The settlements totaled $1.37 million, much of which will be returned to homeowners scammed by foreclosure rescue fraud.

Unsuspecting consumers were victimized by foreclosure rescue scams. Taken Care of Investments Principal Richard Winer will pay fines to the tune of $691,000 without admitting guilt. Homeowners risking foreclosure hired the firm in hopes of remaining in their homes.

The company promised to buy the 270 Arizona homes and lease them back to the homeowners, including catching up past due payments. Homeowners were to pay Winer a monthly fee that equaled their mortgage payments.

In the agreement, homeowners were given the option to buy back their homes for around $15,000 within one year, as long as they never violated any of the conditions of the agreement. If the homeowner failed to submit even one payment on time, the agreement would have been cancelled and eviction procedures could have begun immediately.

Contrary to the agreement, however, the homes were sold out from underneath the homeowners to investors who evicted most of them. The homeowner’s mortgage providers and servicers were never notified of the title transfers.

Around $580,000 in fines was ordered to be paid by a Glendale firm Hope for Homeowners Now (HFHN), along with principals Michael Winding and Matthew Castaneda. The AG office’s complaint? The company fraudulently claimed high success rates in negotiating loan modification agreements.

HFHN charged up-front fees of $3,195. The company claimed that 80 percent of their clients tried and failed to negotiate home modifications on their own. They also strongly discouraged homeowners from using non-profit companies and attempting home modifications on their own, advertising that minimal success would be achieved for homeowners who did.

After being served with the lawsuit, HFHN and its principals never appeared in court nor did they respond to the allegations. Due to the lack of response, a default judgment was issued in the state’s favor. The company’s phone has since been disconnected.