Ohio Attorney General DeWine files lawsuit as part of Operation Mis-Modification

By Alison Goebel, Associate Director On July 23, 2014, Ohio Attorney General Mike DeWine joined fourteen other state Attorneys general, the Consumer Financial Protection Bureau (CFPB), and the Federal Trade Commission (FTC) in filing lawsuits against “foreclosure relief scammers.” Ohio’s lawsuit, filed against a Chicago Company, is one of forty-one companion lawsuits against a total of nine individuals or companies. The lawsuits are being dubbed “Operation Mis-Modification.”

The Plaintiffs allege these companies misrepresented their services or failed to perform services for consumers who were facing foreclosure and seeking assistance, such as loan modifications. According to the Operation Mis-Modification lawsuits, many of the defendants allegedly took advance payments in excess of allowable limits and/or received payment for services never rendered.

If Ohio’s lawsuit is successful, impact consumers may see restitution and the state may receive penalty fees. For Operation Mis-Modification, Ohio is joined by Attorneys general from Arizona, Delaware, Florida, Indiana, Kansas, Louisiana, Maryland, Michigan, New Mexico, New York, North Carolina, Washington and Wisconsin.

The Operation Mis-Modification lawsuits are not like current “bank settlements” that are in the works, such as the settlement with Bank of America. The “bank settlements” are expected to include billion-dollar agreements with lending financial institutions. These settlements could benefit consumers, or go directly to states, as did the funding that supported the Moving Ohio Forward program. As more information is released on potential future bank settlements, GOPC will be sure to update its blog and social media channels.

How Demolition Helps to Stabilize Communities

Western Reserve Land Conservancy’s Thriving Communities Institute recently released a new study that analyzes the economic impact of residential demolition in the Cleveland area between 2009 and 2013. The report’s findings estimate a net benefit of $1.40 for every dollar invested in demolition activity, with larger benefits in high and moderately functioning markets and little to no benefit in weak markets. It also shows that mortgage foreclosure rates decreased in neighborhoods—across all income levels—where demolition activity took place. This study demonstrates the value of demolition as part of a comprehensive strategy to stabilize our communities that struggle with property vacancy. It provides information that can help guide demolition activity to make the most efficient use of limited resources. This study is very timely in light of Ohio Attorney General Mike DeWine’s release last week of an additional $3.8 million in demolition funding awards under the Moving Ohio Forward program.

The study was written by Nigel Griswold, Benjamin Calnin, Michael Schramm, Luc Anselin, and Paul Boehnlein, with support from Thriving Communities Institute, the Cleveland City Council, Ohio Attorney General Mike DeWine, the Eva L. and Joseph M. Bruening Foundation, Cleveland Neighborhood Progress, the Cuyahoga County Land Reutilization Corporation, and land banks throughout Ohio.