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First Criminal Case on Behalf of CFPB, Charges Ex-lawyer Operated Firm

published May 08, 2013

By Author - LawCrossing
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( 2 votes, average: 3.6 out of 5)
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05/08/13

On Tuesday, federal authorities unsealed indictments in the first criminal case based on work done by CFPB since its formation in 2010. The indictment charged four people in a debt settlement company with mail and wire fraud including a former lawyer, Michael Levitis, who has been alleged of controlling and operating the company.


Levitis is a suspended lawyer who was sentenced in 2011 to three years in probation and a fine of $15, 000 for lying during the investigation of a New York State Senator who later pleaded guilty to corruption.

The lawyer for Levitis, Jeffrey Lichtman said that Levitis "strongly denies the allegations," and said "rogue employees were responsible for much if not all the fraud charged here."

The charges against the debt settlement firm, Mission Settlement Agency and the four individual key figures in the firm relate to a scheme that has victimized more than 1,200 people across the country, according to prosecutors.

The CFPB filed a separate civil lawsuit against the debt settlement firm, Mission Settlement as also against New Jersey-based Premier Consultant Group LLC.

The firm used to project that it had the capacity to help people reduce their credit card debts. However, the indictment mentions that the firm "systematically exploited and defrauded" customers. It failed to keep its promises, did not reduce the debts, charged excessive fees and in general did not bother about providing actual services. The result was that people who trusted the firm either had their credit scores cut or faced creditor lawsuits. In several instances, customers of the firm went bankrupt.

At least in the case of about 1,200 customers, the firm took about $2.2 million in fees, but "never paid a single penny" to creditors, says the indictment.

The other three defendants besides Levitis include Denis Kurlyand, Boris Shulman and Manuel Cruz. Durlyand was the vice president of sales, Shulman a sales representative and Cruz assisted with getting customers.

Two other employees of the firm who have been charged in separate indictments have already pleaded guilty.

Richard Cordray, the director of CFPB said "people who are dedicating their lives to committing fraud," needed to be aware that "they could end up in prison."

published May 08, 2013

By Author - LawCrossing
( 2 votes, average: 3.6 out of 5)
What do you think about this article? Rate it using the stars above and let us know what you think in the comments below.

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