The Federal Trade Commission announced today:
Damian Kutzner, one of the operators of a mortgage relief scheme that bilked millions of dollars from financially distressed homeowners, has agreed to a court order banning him from the debt relief business.
The stipulated order resolves the [FTC's] complaint and the contempt charges against Kutzner. It also bans him from providing certain financial products and services, and from making misrepresentations about any products or services. In addition, the order imposes a judgment of more than $18.3 million, representing the amount of consumer harm.
The settlement resolves FTC charges filed in May 2016 against Kutzner and four attorneys operating as Brookstone Law and Advantis Law. The FTC alleged that the defendants told homeowners they were likely to obtain “at least $75,000” or their homes “free and clear” through so-called “mass joinder” lawsuits, when in fact no consumer ever achieved, or was likely to achieve, any mortgage relief. ….
The promise of a mass joinder lawsuit is a ruse that some mortgage relief scammers use to bilk money from struggling homeowners. Unlike class-action lawsuits, in the event of trial each plaintiff in a mass joinder suit would have to prove his or her case separately.
In Kutzner’s case, he and the other defendants did not win any such cases, and most were dismissed by the courts because the defendants did not pursue them. Following the filing of the Commission’s complaint, a judge halted the operation on June 1, 2016, pending the outcome of this litigation.
Under a separate order announced today, Jonathan Tarkowski, an attorney, will be banned from the debt relief business, and prohibited from making misrepresentations about financial and other products and services. The order imposes a judgment of more than $1.1 million, which will be suspended upon payment of essentially all of his assets, valued at $5,307. ….
Kutzner and Tarkowski are prohibited from selling or otherwise benefitting from customers’ personal information and failing to dispose of it properly. Litigation continues against the remaining defendants.
