For Immediate Release:
Monday, June 28, 2021
(RALEIGH) Attorney General Josh Stein is taking action to protect North Carolinians struggling to make their mortgage payments from unlawful debt adjusting and mortgage relief scams. He filed a lawsuit against California debt adjuster Michael Grinnell and his businesses, Home Relief Services and Amstar Services, and a second lawsuit against Ali Reza Karimi and his New York company, Consumer Proponents & Associates Corporation.
“These out-of-state defendants targeted North Carolinians who were trying to make ends meet and keep their homes, took their money upfront, and then failed them,” said Attorney General Josh Stein. “My office will not allow scammers to take advantage of vulnerable people, and I will fight for relief for these North Carolina homeowners.”
Debt adjusting, or promising to help assist with foreclosures or loan modifications in exchange for advance payments, is illegal in North Carolina. In both of his lawsuits, Attorney General Stein alleges that the defendants collected illegal advance fees from North Carolina consumers while falsely promising that they would reduce the consumer’s mortgage loan payments, obtain loan forbearance, and prevent foreclosure on their homes. They failed to perform any of these services. Further, Karimi and his company filed bankruptcy petitions on behalf of their customers, which were ultimately dismissed by courts because they failed to meet the necessary legal requirements.
At least two North Carolinians have lost more than a combined $5,000 as a result of Grinnell’s actions. At least 14 North Carolinians, including some small businesses, have lost more than a combined $37,840 as a result of Karimi’s actions.
Attorney General Stein is seeking injunctive relief as well as cancellation of all contracts with North Carolina customers, restitution, civil penalties, and attorneys’ fees.
A copy of the Grinnell complaint is available here.
A copy of the Karimi complaint is available here.