California orders $4 million in penalties in loan scam
California’s attorney general announced more than $4 million in penalties have been levied against defendants in a national loan modification scam. Half of the money will go to consumers who were duped.
Over 1,000 customers were caught in the ploy and paid a total of more than $2 million in modification services to Orange County-based Statewide Financial Group Inc., according to a release Tuesday from the office of Atty. Gen. Kamala Harris.
“These defendants took advantage of vulnerable people in extremely difficult circumstances, including many who faced imminent loss of their homes,” Harris said.
“The significant financial penalties imposed by the court let scammers know that severe consequences will flow to those who defraud California consumers.”
The attorney general’s office shut down the business in 2009, which had been in operation since January 2008.
The business’ owners -- Zulmai Nazarzai, Hakimullah Sarpas and Fasela Sheren (who went by the name Sharon Fasela) -- were all found liable in Orange County Superior Court for violating California’s Unfair Competition Law and False Advertising Law.
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