Lawrence Financial Company Ordered to Pay More Than $240,000 for Continuing Predatory Loan Practices
Pinnacle Financial Consulting and Owner Robert Burton Found in Violation of Court Orders
BOSTON – A judge ordered a Lawrence financial company and its owner to pay more than $240,000 after persistently violating court orders, including continuing to solicit consumers and receive payments for loan modification services, Attorney General Martha Coakley announced today.
Suffolk Superior Court Judge Elizabeth Fahey found Pinnacle Financial Consulting, LLC (Pinnacle) and its owner Robert Burton in contempt of court for failing to follow the terms of several injunction orders obtained by the AG’s Office in a lawsuit filed in March. The lawsuit alleged that Burton and Pinnacle used the foreclosure crisis for their profit, allegedly targeting minority and non-native English speakers desperate to save their homes from foreclosure.
“These defendants, despite a court order, continued to solicit consumers with their deceptive foreclosure relief practices and illegal upfront fees,” AG Coakley said. “Consumers need to be aware of these scams that attempt to take advantage of struggling homeowners.”
The lawsuit further alleged that Pinnacle and Burton misrepresented to consumers the loan modification, bankruptcy petition preparation and investment services they could provide; exaggerated the benefits of their services; charged unlawful advance fees; practiced law without a license; failed to take any action to provide the promised services after receiving payment; and refused to provide refunds upon request. The judgment on Nov. 14 followed a trial held in August against the defendants on the contempt allegations.
In March 2013, the AG’s Office obtained a temporary restraining order prohibiting the defendants from dissipating or concealing assets and destroying records. The AG's Office then obtained preliminary injunctions barring the defendants from advertising, soliciting, or providing any loan modification services, bankruptcy petition preparation services, legal advice or services, or financial and investment services, and further requiring the defendants to make affirmative disclosures to consumers and employees, and deposit into an escrow account more than $97,000 of restitution and penalties, which remains unpaid.
Under the judgment, the defendants have been ordered to pay more than $240,000, including $170,000 in penalties, close to $30,400 in restitution, and more than $39,800 in fees and costs.
Under Massachusetts law, consumers should not be charged advance fees for foreclosure-related services. In 2007, the AG’s Office issued regulations that prohibit soliciting or accepting an advance fee in connection with foreclosure-related services, or advertising services without disclosing exactly what is offered to avoid foreclosure, among other unfair practices.
This matter is being handled by Assistant Attorney General Justin J. Lowe and Division Chief Stephanie Kahn of AG Coakley’s Consumer Protection Division, with assistance from Paralegal Krista Roche, and William Mackay from the Civil Investigations Division.
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