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Attorney General's News Release

March 29, 2010

Attorney General Koster obtains judgments against two foreclosure rescue companies


--Court orders $116,000 in restitution --


Jefferson City, Mo. -- Attorney General Chris Koster said today his office has obtained judgments against two foreclosure rescue companies who allegedly took money from distraught homeowners and failed to provide promised services.

"This Attorney General's office has instituted a zero tolerance policy for any mortgage modification firm that preys on and cheats desperate homeowners," Koster said. "Our office will use all its powers to investigate and prosecute businesses involved in these schemes to defraud Missouri consumers."

Koster said his office reached a settlement with Gateway Mortgage Modification, owned by Richard R. Reichert, Jr.  Gateway was alleged to have unlawfully charged up-front fees for foreclosure and mortgage modification services and to have falsely promised consumers that attorneys would negotiate loan modifications on their homes.

Koster said the court ordered Gateway and Reichert to pay $65,000 restitution.  In addition, the court permanently prohibited the company from charging up-front fees for services and from falsely representing to consumers that attorneys would negotiate modifications.  The court also permanently prohibited Gateway and Reichert from violating the state's merchandising practices and foreclosure consultant laws and ordered them to pay attorney fees and costs.  Koster said that if the company fails to pay restitution as ordered, an additional $10,000 penalty will be imposed.


Koster said First Universal Lending, LLC, based in Palm Beach Gardens, Florida, marketed its services to homeowners who were having difficulty paying their mortgages or facing foreclosure, promising them lower house payments or lower interest rates.  Company representatives told some clients to stop making mortgage payments while the modification process was proceeding, which harms consumers by injuring their credit rating and increasing likelihood of foreclosure.  The business also illegally required homeowners to pay up-front fees before they would provide any services.

Koster said the court ordered First Universal to pay more than $51,000 restitution and $23,000 civil penalties.  The company also is prohibited from charging up-front fees; advising homeowners to stop making mortgage payments; and promising loan modifications they fail to follow through with.

The Attorney General urges consumers who have been the victims of fraudulent mortgage modification or foreclosure rescue companies, or who are concerned about the practices of their lender, to contact his consumer hotline at 800-392-8222 or to go online at

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