DOJ obtains relief in lawsuit alleging discriminatory targeting of Hispanic homeowners

FLORIDA — The Department of Justice has announced that a settlement has been reached in a Fair Housing Act claim alleging that a Florida business and individuals associated with it discriminated on the basis of national origin when they targeted Hispanic homeowners for predatory mortgage loan modification services and interfered with those individuals’ ability to keep their homes.

The Department of Justice on Friday announced that the U.S. District Court for the Middle District of Florida entered a consent order resolving the department’s Fair Housing Act claims against Advocate Law Groups of Florida P.A. (ALGF); Jon B. Lindeman Jr.; Ephigenia K. Lindeman; Summit Development Solutions USA LLC (SDS) and Haralampos “Bob” Kourouklis.

The consent order enters a judgment against the defendants for $4,595,000 to compensate people who were harmed by the defendants’ conduct, the DOJ said.

The department alleged in its complaint that the defendants targeted Hispanic homeowners with Spanish-language advertising that falsely promised to cut their mortgage payments in half.

Defendants made the same representations to hundreds of Hispanic homeowners in person, promising lower payments in exchange for thousands of dollars of upfront fees and continuing monthly fees of as much as $550, which defendants claimed were “non-refundable,” the DOJ said.

According to the DOJ, many of the targeted homeowners had limited English proficiency.

The department’s complaint further alleged that the defendants directed these homeowners not to communicate with their lenders and to stop making their monthly mortgage payments. According to the complaint, the defendants did little or nothing to obtain the promised loan modifications for the homeowners, many of whom defaulted on their mortgage payments and ultimately lost their homes.

“Targeting homeowners with deceptive advertisements and predatory schemes because of their national origin and limited English proficiency is reprehensible and illegal,” said Assistant Attorney General Kristen Clarke for the Civil Rights Division.

“Homeowners of color and other protected groups must be safeguarded from discriminatory targeting that can lead to grave financial loss, including loss of one’s home. We will continue to use our federal civil rights laws to protect the rights of homeowners.”

“This settlement, reached in partnership with the Civil Rights Division’s Housing Section, is a major achievement for our Civil Division and its Civil Rights Unit,” said U.S. Attorney Roger B. Handberg for the Middle District of Florida.

“We are committed to using every legal tool available, including the Fair Housing Act, to ensure that our residents enjoy their right to housing without discriminatory practices of this kind.”

The Justice Department said it brought the suit after Lucía Hurtado, Noemí Román, Argentina Roque, and members of their families filed complaints of discrimination with the Department of Housing and Urban Development (HUD).

After HUD investigated the complaints, it issued charges of discrimination and referred the matter to the Justice Department for litigation. Hurtado, Román and Roque later intervened as plaintiffs in the department’s lawsuit.

The consent order enters a judgment against the defendants for $4,595,000, including $95,000 to the three intervenors, plus a civil penalty to the United States, the DOJ said.

However, according to the DOJ, most of the monetary judgment is suspended based on evidence of defendants’ limited net worth, including financial statements signed by defendants under penalty of perjury.

The consent order requires defendants to submit updated financial statements each year during the five-year term of the settlement. If the court determines that the defendants made any material misrepresentations or omissions in their original financial statements or in the annual updates, the entire judgment will be reinstated, and the defendants will be immediately liable for the full amount, the DOJ said.

In addition to monetary relief, the DOJ said the consent order permanently enjoins defendants from providing any mortgage relief assistance services, such as loan modifications or foreclosure defense services, and imposes reporting and recordkeeping requirements for defendants’ other real-estate activities.

This case was litigated by attorneys in the department’s Civil Rights Division and the U.S. Attorney’s Office for the Middle District of Florida.