The Colorado Attorney General’s Office filed suit yesterday against two law firms claiming that they have defrauded thousands of homeowners, banks, investors and ultimately taxpayers. The suit was filed against The Castle Law Group and Aronowitz and Mecklenberg. The Aronowitz firm has already agreed to settle the case by paying 10 million dollars and in addition the firm will either sell or close its Denver practice within 6 months. That firm did not admit any wrongdoing.
It is expected that the other firm, the Castle Group, will fight the AG’s suit.
The two firms are alleged to have set prices on process service fees that are incurred in foreclosures.
This comes right after an announcement this week that Colorado investigators were involved in a multi-billion dollar settlement with Citigroup over mortgage fraud. Part of that settlement would see money coming to homeowners with mortgage distress as well as communities affected by foreclosures. Darren O’Connor with the Colorado Foreclosure Resistance Coalition joins us to talk about both these developments.