The Office of Chief Trial Counsel of the State Bar of California recently announced the disbarment of four California attorneys as a result of investigations conducted by its Loan Modification Task Force.

Since its inception in April 2009, the task force has obtained the resignation of 12 attorneys involved in loan modification misconduct.

The efforts of the Task Force have also resulted in six pending loan modification trials, 1,800 active investigations and the processing of more than 4,000 complaints by consumers.

Attorneys who have been disbarred as a result of the task force’s actions have been charged with wide range of misconduct, including the collection of illegal fees; failure to refund fees; nonperformance of work they were hired to perform (loan modifications and foreclosure defense); the formation of partnerships with non-attorneys and assisting non-attorneys in the unauthorized practice of law; filing of frivolous and phony lawsuits to reduce mortgage debt; abandoning clients; failing to return files/documents to clients; making misrepresentations to the court; and, practicing law in states where they are not licensed.

Potential clients are led to believe that all loans can and will be modified by lenders. Consumers should be aware that not all loans can or will be modified by lenders and that many of these operations make no attempt at modifying the loans.

In October 2009 a new law, SB 94, was signed in to law, prohibiting persons from charging advance fees to borrowers in connection with the modification of the terms of the borrower’s loan and requiring those who wish to charge a fee for loan modification services (after performing them) to provide a specific notice to borrowers regarding other options available to the borrower.

Since April 2009 the Loan Modification Task Force has received more than 1,250 complaints and is investigating almost 250 lawyers for questionable practices.

Close to 20,000 attorney files have been removed from the offices of attorneys whose loan modification practices have been shut down or abandoned.

Local law enforcement, the California Attorney General’s Office and the Federal Bureau of Investigation have partnered with the task force to investigate and stop businesses and law firms that prey on individuals in danger of losing their homes to foreclosure.

“Our office has given a very high priority to allegations of attorney misconduct in connection with loan modification service, and I have been very impressed by the successful work of the Loan Modification Task Force – to date, 12 lawyers have surrendered their licenses, and four stipulated disbarments have been approved by the State Bar Court,” said Chief Trial Counsel Jim Towery of the State Bar recently commented. “I intend to maintain the office’s aggressive stance with respect to attorneys that have engaged in loan modification misconduct.”

For more information about reporting attorney misconduct go to www.calbar.ca.gov/Attorneys/LawyerRegulation.aspx.

For local assistance with evaluating the options if you are headed toward a foreclosure, contact the California Human Development Corporation at 3315 Airway Drive, Santa Rosa, CA 95403, telephone 707-372-4588 or 707-521-4789 or, for Lake County seniors only, the Senior Law Project at 707-263-4703. Both CHDC and the Sr. Law Project are HUD-approved agencies for loan modification assistance.

Mary Heare Amodio is president of the Lake County Bar Association and practices in the areas of estate planning, probate, conservatorship, guardianship, consumer bankruptcy, in addition to business and real estate transactions. She can be reached at 707-263-5759 or at

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