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Attorney General Koster Declares 'Zero Tolerance' on Mortgage Scams
KANSAS CITY, (kansascityfrontpage.com), April 28, 2009 - Attorney General Chris Koster has announced his "zero tolerance" campaign against mortgage scams in Missouri, pledging he will "aggressively investigate any suspicion of mortgage deception and use all means in the legal system to prosecute and shut them down or end their deceptive practices."

As part of the "Zero Tolerance" campaign, the Attorney General today filed lawsuits against two businesses that sent misleading direct-mail advertisements for mortgage refinancing to consumers. These two lawsuits follow a similar lawsuit filed by Koster last week against a California-based mortgage broker doing business in Missouri.

The Attorney General filed suit against Goldstar Home Mortgage, which sent direct-mail letters to consumers with the consumers' own bank name at the top of the letter, making it appear that the consumers' bank was encouraging them to refinance. In addition, Goldstar marketed mortgage-refinancing products that were inappropriate for the homeowners they targeted. In at least one case, the business offered a loan that likely would have left a homeowner with a mortgage that was higher than the home was worth.

Attorney General Koster also filed suit against Oxford Lending Group, which made deceptive representations regarding the "Economic Stimulus Act of 2008" in its mailing to appear that consumers had a special opportunity to refinance, and using the HUD (U.S. Department of Housing and Urban Development) label and name to mislead the recipient that the letter was related to the federal government.

"This Attorney General's office will have zero tolerance for any mortgage broker or refinancing lender that uses deception to lure consumers into doing business with them," Koster said. "The Attorney General's office will use all its powers to investigate and prosecute businesses that use deception and fraud in advertisements to Missouri consumers."

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