The California Attorney General filed a $2 million lawsuit against a foreclosure consultant and an attorney Monday saying they defrauded 2,000 homeowners, including some in Kern County, into paying thousands for fraudulent home foreclosure help.
Attorney general Jerry Brown alleges Paul Noe Jr. and Mitchell Roth conned homeowners into paying large fees for phony lawsuits.
The lawsuit also seeks full restitution and a court ruling to prevent Noe and Roth from offering foreclosure consultant services.
"The lawsuits were filed and abandoned, even though homeowners were charged $1,800 in upfront fees, at least $1,200 per month and contingency fees of up to 80 percent of their home's value." Brown said in a statement. "Instead of aggressively pursuing the lawsuits, Noe and Roth strung them along so they could continue to rake in fees."
Southwest Bakersfield homeowner Eddy Herrera, 23, said he was one of the victims. Herrera told 17 News in March he was referred to Roth by a friend who said his foreclosure company could help get him current on his home payments.
Herrera had fallen behind on payments for the home he purchased to live in with his parents and brothers after its value plummeted and his payments increased.
Herrera said a representative from Roth's office told him to send monthly payments to a foreclosure relief company they worked with called 'United First.'
Herrera said the representative told him to ignore all letters from his lender, but seven months and $10,000 later the house was being auctioned at a foreclosure sale.
The attorney general's office calls what the homeowners signed a "joint venture" agreement. They allowed Roth to file lawsuits, Brown said, claiming that the borrower's loan was invalid because the mortgages had been sold so many times on Wall Street that the lender could not demonstrate who owned it.
According to the attorney general's news release:
"Similar suits in other states have never resulted in the elimination of the borrower's mortgage debt After filing the lawsuits, Roth did virtually nothing to advance the cases. He often failed to make required court filings, respond to legal motions, comply with court deadlines, or appear at court hearings."
Paul Noe Jr. was convicted of wire fraud in 1989 and the subject of a California Department of Insurance Cease and Desist Order in 2004, the release indicated. Mitchell Roth resigned for the California State Bar in late May 2009, after the State Bar closed his law firm.
