Nov. 4, 2016 By Christian Murray
A Long Island City man who operated a large foreclosure rescue scam out of a Queens Plaza North office reached a settlement with the New York State District Attorney’s Office for $1.6 million Tuesday.
Mauricio Vallamarin Martinez, who lives at 4117 Crescent Street, ran American Hope Group out of a second-floor office at 24-15 Queens Plaza North, where he masterminded a fraudulent mortgage rescue scam that netted his firm millions of dollars over a number of years.
His company promised struggling homeowners that it could help modify their loans and therefore save their homes. Despite these claims, his firm didn’t deliver on its promises and made many of his clients’ dire situation worse, according to New York State Attorney General Eric T. Schneiderman.
The company would charge its clients an illegal upfront fee of $2,850 that would also be accompanied by a $695 monthly fee, according to Schneiderman’s office. Some homeowners paid as much as $25,000-$37,000 over a period of time, according to court documents, and received little or no services in return.
American Hope targeted Hispanics and ran ads in Spanish-language publications claiming it could obtain loan modifications, principal reductions and other benefits to get their clients’ relief. It enticed customers with terms like “American Dream” and offers of “free” service, according to court documents filed by Schneiderman’s office.
Martinez and the company have been banned from providing mortgage assistance relief for three years, as well as being fined $1.6 million.
“My office will aggressively investigate companies that scam New Yorkers out of their hard earned money by seeking to exploit financially distressed homeowners who are in danger of losing their homes to foreclosure,” Schneiderman said in a statement.
The company told consumers that it would look through their mortgage documents by providing a ‘forensic audit.’ The firm said it would then be able to identify errors or mortgage fraud and find ways to modify a loan. It said it would work with mortgage servicers to restructure their mortgage.
However, when many consumers called their mortgage service company they discovered that the banks had received no communication from American Hope at all, according to court documents.
The company’s Queens Plaza North office is located one floor above the Ecuadorian embassy and Martinez lives less than a block away at the Crescent Club residential complex, according to court documents. The firm also conducted business out of an Elmhurst office.
The ads would be published in papers such as El Diario. In one of its advertisements, according to Schneiderman’s complaint, it stated “American Hope Group has determined it will defend the Hispanic Community of the Tri-state area” and that it “works with the Hispanic community to recover the American dream.”
The company claimed to have a reputation of excellence, yet was rated an “F” on the BBB website.
The company’s ads and fliers were deemed to be misleading, according to the attorney general’s office.
The firm would also use public records to identify distressed homeowners and then send them direct mail solicitations that made it appear that it was sent from a court of governmental agency, according to court documents filed by Schneiderman’s office. The mailings would read: “Notice of Default” or “Request for Immediate Action.”
The company’s advertisements lacked critical disclosures required by law, according to Schneiderman, such as informing consumers that American Hope Group is not associated with the government, its services were not approved by the government and that lenders may not agree to modify their mortgage.
American Hope also promoted its services on its website americanhopegroup.org until 2014.
The company also failed to notify its clients that it could stop doing business with it at any time.
Many consumers were told to stop making their mortgage payments and to avoid interacting with their mortgage servicers placing them in greater danger of foreclosure, Schneiderman said.
Local officials applauded Schneiderman following the settlement.
“Companies that scam and prey on New Yorkers should be investigated and prosecuted,” said State Senator Jose Peralta. “It’s appalling that in the middle of the foreclosure crisis this company took advantage of hard working New Yorkers, especially Latinos as they found hard to keep their properties.”
Representatives of the company and Martinez could not be reached for comment.