No Let-up in Loan Modification Complaints

• Jurisdiction: California,United States
• Citation: Vol. 02 No. 2011 Pg. 01
• Publication year: 2011
• Pages: 01
• Year: 2011
• topic: Business of Law,Bankruptcy and Insolvency,Contracts,Civil Procedure,Real Estate

California Bar Journal 2011.

CBJ - February 2011 #01. No let-up in loan modification complaints

The California Lawyer
February 2011

No let-up in loan modification complaints

By Nancy McCarthy
Staff Writer

Despite extensive efforts over the past two years to rein in improper loan modification activities by some lawyers, including legislation and aggressive prosecution by the State Bar and the attorney general, complaints from clients continue unabated. Chief Trial Counsel James Towery, who took over as the bar's head prosecutor in August, said one-third of his office workload is devoted to loan modification complaints; 1,500 investigations of 400 attorneys currently are active. Twenty have either resigned or been disbarred.

"We've made tremendous strides but we haven't stemmed the tide," Towery said. "The foreclosure crisis is so significant in California, and regrettably it has been an opportunity for a small number of attorneys to take advantage of people and try to get rich quick."

The foreclosure complaints are largely responsible for a 50 percent or more increase in the discipline unit's work between 2008-2010, he said. Historically the office handles about 1,500 investigations at a time. That number rose to 2,500 in 2009, to 3,500 last year and currently stands at 3,200. "It's been challenging for everyone," Towery said. "It's like being in a district attorney's office in the midst of a crime wave."

Despite the larger number of complaints and a steady number of calls -6,500 per month -to the...