Foreclosure Rescue Scams as a Virus

Foreclosure Rescue Scams as a Virus

Attorney Melissa A. Huelsman is the author of a new chapter on foreclosure rescue scam litigation in Real Estate Financing (Lexis treatise).  (If you haven’t already seen it, check out her analysis of the anatomy of such a scam.)  In listening to her podcast interview on the subject -- in which she talks about how scammers can “tweak” the foreclosure rescue scam to stay ahead of legislation -- I’ve begun to think of these kinds of scams as a kind of virus mutating. 
 
They may be impossible to get rid of entirely.
 
And they don’t go away when economic conditions improve.  Ms. Huelsman makes that point in her podcast

 

interview, when she describes how the thieves of home equity have even more incentive to take advantage of homeowners when the equity in homes is higher.
 
But we are in a new era.  We have now a new opportunity to look at fraud as something that can happen to anyone; because every society is built on trust. We all have reason -- more reason than ever -- to be vigilant for ourselves and for each other.  And I think we have more reason than ever to remove any stigma from being a fraud victim.  And to spend more of our resources to prevent fraud from occurring and to prosecute when it does.
 
I was very moved to read about volunteers tearing down foreclosure rescue signs as reported in the New York Times.  And it was very dramatic to read NY Attorney General Andrew M. Cuomo’s words about scams in the foreclosure rescue industry and plans for prosecution and a nationwide investigation.
 
I hope that more attorneys will consider helping homeowners who have been “rescued” right out of all the equity in their homes.  As Ms. Huelsman discusses in her podcast, foreclosure rescue scams are not new.  But what could be new—going forward—is a new empathy for the victims of such scams, and a new awareness that fraud is not something that only happens to the desperate or the disadvantaged.  If fraud is a virus, we are all vulnerable. 
 
(See also my blog

 

in which I asked Ms. Huelsman’s advice about talking to neighbors about foreclosure rescue scams.)