Agency: Consumer Financial Protection Bureau
Description:
On July 18, 2012 the Consumer Financial Protection Bureau (CFPB) filed its first ever civil enforcement action in federal court charging Chance Edward Gordon, Abraham Michael Pessar, and several related companies with duping distressed homeowners into paying high upfront fees with false promises of a loan modification.
The lawsuit alleged that Gordon, Pessar, and their companies promised to help homeowners substantially reduce their mortgage payments, enroll in government mortgage programs, or stop foreclosures. But they did not provide the services they promised. To convince homeowners to sign up for their services, they falsely suggested that they were affiliated with or endorsed by the government. They also charged illegal upfront fees.
These actions violated the Consumer Financial Protection Act, the Mortgage Assistance Relief Services Rule, or both. Gordon and his affiliates also violated federal law by advising consumers to stop paying their mortgages without also warning the consumers that doing so could damage their credit ratings or cause them to lose their home. In addition, the CFPB also alleged that the defendants illegally instructed consumers not to communicate with their lenders.
As a result of this federal lawsuit consumers who paid Gordon and his companies were issued refund checks in May 2015.
Detailed information regarding the enforcement action, final judgment, and consumer refunds can be found on the CFPB website.
Date of Action: 11/16/2012
Agency: California State Bar
Description:
On November 22, 2016 the State Bar Court of California filed a “Decision and Order of Involuntary Inactive Enrollment” against Attorney Chance Edward Gordon. The disciplinary proceeding is currently pending and has been contested by Gordon. The State Bar has filed the action alleging misconduct, entering into a partnership with a non-attorney; splitting fees with non-attorneys; false advertising; failing to comply with all laws; and committing acts of moral turpitude. Based on the serious nature of the matter among other things, the State Bar seeks for Gordon to be disbarred.
According to the action between 2009 and 2012 Gordon and non-attorney Abraham Michael Pessar (Pessar) started a loan modification operation in California, the only state that Gordon has been licensed to practice law. The business eventually spread nationwide and signed up around 2,300 clients taking in approximately $11.4 million. The business received numerous complaints regarding accepting illegal advanced fees for loan modification services and failure to perform the promised services. . Only a small percentage of clients received any mortgage modifications or forbearance, and a significant portion of those did not receive the terms promised by the company. In July 2012 the Consumer Protection Financial Bureau issued a temporary restraining order against Gordon and his businesses and shut down the company.
The State Bar is looking to have Gordon disbarred from the practice of law in the State of California and a money judgment. The status of the action is pending.
Details of the action are available here.
Date of Action: 11/22/2016