Stephen Lyster Siringoringo also d/b/a Siringoringo Law Firm, Clausen & Cobb Management Company, Inc., and Joshua Cobb

Agency: Consumer Financial Protection Bureau
Date: July 22, 2014
Type: enforcement action
Source: consumerfinance.gov/enforcement/actions/stephen-siringoringo-alfred-cl
Pages: 44
PDFs: 4 documents (links below)

Documents in this case

Complaint · July 2014 · 12 p.
Amended complaint · Jan. 2017 · 12 p.
Judgment · Jan. 2017 · 12 p.
Judgment · Jan. 2017 · 7 p.

Case summary

On July 22, 2014,

the Bureau filed a complaint in federal court against Stephen Lyster

Siringoringo, also d/b/a Siringoringo Law Firm, Clausen & Cobb Management

Company, Inc., Alfred Clausen, and Joshua Cobb. The CFPB alleged that the

defendants, who offered purported home-loan modifications, asked for and

received fees from consumers before the consumers had entered into

loan-modification agreements with their lenders or loan servicers; defendants

misrepresented aspects of their services, including the likelihood that they

would obtain loan modifications on behalf of consumers; and defendants failed

to make disclosures required by law. The CFPB alleged that this conduct

violated Regulation O, formerly known as the Mortgage Assistance Relief

Services (MARS) Rule, and the Dodd-Frank Wall Street Reform and Consumer

Protection Act’s prohibition on deceptive acts or practices.

Complaint (July 2014)

PDF of this document (12 pages)

Page 2

ANTHONY ALEXIS, DC Bar #384545 Email: [email protected] Phone: (202) 435-7999 JEFFREY PAUL EHRLICH, FL Bar #51561 Email: [email protected] Phone: (202) 435-7598 JOHN C. WELLS, DC Bar #491292 Email: [email protected] Phone: (202) 435-9319 MAXWELL S. PELTZ, CA Bar #183662 Email: [email protected] Phone: (415) 633-1328 NAVID VAZIRE, NY Bar #4520391 Email: [email protected] Phone: (202) 725-8397 1700 G Street, NW Washington, DC 20552 Fax: (415) 677-9954

Attorneys for Plaintiff Consumer Financial Protection Bureau

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION

Consumer Financial Protection Bureau,

Plaintiff,

Stephen Lyster Siringoringo, an individual, also d/b/a Siringoringo Law Firm; Clausen & Cobb Management Company, Inc., a corporation; Alfred Clausen, an individual; and Joshua Cobb, an individual, Defendants.

Case No. 2:14-CV-5681

COMPLAINT FOR PERMANENT INJUNCTION AND OTHER RELIEF

Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 1 of 12 Page ID #:1

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JURISDICTION AND VENUE 1.

This Court has subject-matter jurisdiction over this action because it is “brought under Federal consumer financial law,” 12 U.S.C. § 5565(a)(1), presents a federal question, 28 U.S.C. § 1331, and is brought by an agency of the United States, 28 U.S.C. § 1345.

Venue is proper under 28 U.S.C. § 1391(b) and 12 U.S.C. § 5564(f) because a substantial part of the events or omissions and course of conduct giving rise to the claims set forth in this Complaint occurred in this district. INTRODUCTION 3.

The Consumer Financial Protection Bureau brings this action under sections 1031, 1036(a), 1054, and 1055 of the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5531, 5536(a), 5564, 5565, and under section 626 of the Omnibus Appropriations Act, 2009 (as amended by section 1097 of the CFPA), 12 U.S.C. § 5538, and its implementing regulation, the Mortgage Assistance Relief Services Rule (MARS Rule, or Regulation O), 12 C.F.R. Part 1015 (2011), in connection with Defendants’ marketing and sale of purported mortgage assistance relief services.

PARTIES 4.

The Consumer Financial Protection Bureau is an independent agency of the United States charged with regulating the offering and provision of consumer-financial products and services under federal consumer-financial laws, including the CFPA and Regulation O. 12 U.S.C. §§ 5481(12)(Q), (14), 5491(a), 5531, 5538.

The Bureau is authorized to initiate federal district court proceedings, by its own attorneys, to enjoin violations of the CFPA and Regulation O, and to secure such relief as may be appropriate in each case. 12 U.S.C. §§ 5564(a)-(b), 5565. This includes the rescission or reformation of contracts, the refund of Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 2 of 12 Page ID #:2

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moneys paid, restitution, disgorgement or compensation for unjust enrichment, and civil money penalties. Id. § 5565(a)(2).

Defendant Stephen Lyster Siringoringo (Siringoringo) is the principal of Siringoringo Law Firm, a purported law firm with offices in San Bernardino County, Riverside County, Orange County, and Los Angeles County, all in California. Siringoringo has transacted business in this district. 7.

Defendant Clausen & Cobb Management Company, Inc. (CCMC) is a California corporation with an office in San Bernardino County, California. CCMC has transacted business in this district.

Defendant Alfred Clausen (Clausen) is an owner and manager of CCMC. Clausen has transacted business in this district. 9.

Defendant Joshua Cobb (Cobb) is an owner and manager of CCMC. Cobb has transacted business in this district. 10.

Defendants Siringoringo, CCMC, Clausen, and Cobb, each acting alone or in concert with others, offer or provide, or arrange for others to provide, “mortgage assistance relief services,” as defined in Regulation O (12 C.F.R. § 1015.2 (2011)), and “financial advisory services” within the meaning of the CFPA, 12 U.S.C. § 5481(15)(A)(viii), including but not limited to loanmodification and foreclosure-relief services. 11.

Clausen and Cobb have had managerial responsibility for CCMC and have materially participated in the conduct of its affairs, including the development and approval of the purported mortgage assistance relief services described here. Clausen and Cobb are intimately familiar with and direct CCMC’s operations, including its purported mortgage assistance relief services. Both Clausen and Cobb knew of and approved all of the practices described in this Complaint.

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SUMMARY OF COMPLAINT 12.

Since at least December 2010, Defendants have marketed and sold purported mortgage assistance relief services to consumers. Defendants attracted financially distressed homeowners through advertisements, mailings, and in-person consultations, deceptively promising loan modifications and foreclosure relief in exchange for advance fees. Defendants also misled consumers into believing that an attorney would represent them in negotiations with their lenders or servicers. In the end, consumers paid thousands of dollars each in advance fees, but in numerous instances received none of the promised services or relief. DEFENDANTS’ BUSINESS PRACTICES 13.

In or about December 2010, Defendants entered into an agreement under which CCMC – a company owned and managed by Clausen and Cobb – provided staffing, marketing, office space, equipment, and general operational and administrative support to the Siringoringo Law Firm (SLF) – a purported law firm of which Siringoringo was the principal – in its offering of loan-modification services. Clausen and Cobb individually and in concert actively directed and managed SLF’s operations, including managing staff and overseeing administrative functions; setting and enforcing policies and procedures; developing marketing; and setting fees and controlling office finances. Siringoringo did not typically have contact or involvement with clients or their lenders; those functions were left to non-attorney CCMC personnel. Client files typically lacked any documents written, authored, or signed by Siringoringo. 14.

Defendants heavily marketed SLF’s purported loan-modification services through television, radio, and internet advertisements, as well as direct mail and email solicitations, in both English and Spanish. A number of advertisements featured Siringoringo describing his skills, experience, and success in obtaining loan modifications. The advertisements deceptively suggested that Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 4 of 12 Page ID #:4

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SLF enjoyed high rates of success in obtaining loan modifications and other foreclosure relief and misled consumers into believing that they would receive the services of an attorney, Siringoringo.

15.

Consumers who went to SLF to inquire about the services it could provide would meet with individuals employed by CCMC. Those individuals would mislead consumers into believing that they were eligible for a loan modification, that they would obtain a modification within 45 days, and that Siringoringo would directly negotiate with their lender or servicer to obtain the desired relief. CCMC personnel would present consumers with an SLF retainer agreement that also misleadingly suggested that they would be receiving the services of an attorney.

16.

Defendants enrolled thousands of consumers through these practices. 17.

Under the terms of the retainer agreement, Defendants charged consumers an initial fee of between $1,995 and $3,500 for the purported preparation of a loan-modification application and then charged a monthly fee of $495 for purported continued processing, communication, and negotiation with the lender or servicer. Consumers paid all such fees before any written agreement was reached with the consumers’ lender or servicer or any other mortgage assistance relief was obtained. Defendants never disclosed to consumers that they may stop doing business with Defendants or reject an offer of mortgage assistance without having to pay for Defendants’ services. Defendants also failed to disclose that they were not associated with the government and their services were not approved by the government or the consumer’s lender.

18.

In numerous instances, after consumers paid Defendants’ advance fees, Defendants failed to answer or return consumers’ telephone calls and emails and failed to provide updates about the status of consumers’ loan-modification applications. In numerous instances, after consumers paid Defendants’ advance Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 5 of 12 Page ID #:5

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fees, Defendants failed to obtain loan modifications or foreclosure relief for consumers.

19.

In numerous instances, consumers received no representation by an attorney.

REGULATION O 20.

In 2010, the Federal Trade Commission promulgated the MARS Rule to prohibit unfair and deceptive acts or practices with respect to mortgage-loan or foreclosure-relief services. 16 C.F.R. Part 322. In the CFPA, Congress transferred rulemaking authority over the MARS Rule to the Bureau, which recodified the Rule as 12 C.F.R. Part 1015 and designated it “Regulation O.” The Bureau has authority to enforce Regulation O, as well as the prior MARS Rule, under 12 U.S.C. §§ 5538(a), 5564. (References below to “Regulation O” encompass both Regulation O and the MARS Rule.) 21.

Regulation O defines “mortgage assistance relief service” as “any service, plan, or program, offered or provided to the consumer in exchange for consideration, that is represented, expressly or by implication, to assist or attempt to assist the consumer with . . . [n]egotiating, obtaining, or arranging a modification of any term of a dwelling loan, including a reduction in the amount of interest, principal balance, monthly payments, or fees.” 12 C.F.R. § 1015.2 (2011). 22.

Regulation O defines “mortgage assistance relief service provider” as “any person that provides, offers to provide, or arranges for others to provide, any mortgage assistance relief service,” other than the dwelling loan holder, the servicer of a dwelling loan, or any agent or contractor of such individual or entity. 12 C.F.R. § 1015.2 (2011).

23.

Defendants are “mortgage assistance relief provider[s]” engaged in the provision of “mortgage assistance relief services” as those terms are defined in Regulation O. 12 C.F.R. § 1015.2 (2011).

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24.

Regulation O prohibits any mortgage assistance relief service provider from requesting or receiving payment of any fee or other consideration until the consumer has executed a written agreement between the consumer and the consumer’s loan holder or servicer that incorporates the offer that the provider obtained from the loan holder or servicer. 12 C.F.R. § 1015.5(a) (2011). 25.

Regulation O further prohibits any mortgage assistance relief service provider from misrepresenting, expressly or by implication: (1) the likelihood of negotiating, obtaining, or arranging any represented service or result; (2) the amount of time it will take the mortgage assistance relief service provider to accomplish any represented service or result; or (3) that the consumer will receive legal representation. 12 C.F.R. § 1015.3(b) (1), (2), (8) (2011). 26.

Regulation O requires any mortgage assistance relief service provider, in every general commercial communication, as defined by 12 C.F.R. § 1015.2, to disclose that the provider is not associated with the government and its service is not approved by the government or the consumer’s lender. 12 C.F.R. § 1015.4(a)(1) (2011).

27.

Regulation O further requires any mortgage assistance relief service provider, in every consumer-specific commercial communication, as defined by 12 C.F.R. § 1015.2, to disclose: (1) that the consumer may stop doing business with the provider or reject an offer of mortgage assistance without having to pay for the services; and (2) that the provider is not associated with the government and its service is not approved by the government or the consumer’s lender. 12 C.F.R. § 1015.4(b)(1), (2) (2011).

28.

Regulation O further provides that it is a violation “for a person to provide substantial assistance or support to any mortgage assistance relief service provider when that person knows or consciously avoids knowing that the provider is engaged in any act or practice that violates” the rule. 12 C.F.R. § 1015.6 (2011). Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 7 of 12 Page ID #:7

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29.

Under section 1097 of the CFPA, 12 U.S.C. § 5538, a violation of Regulation O constitutes an unfair, deceptive, or abusive act or practice under the CFPA, in violation of sections 1031 and 1036 of the CFPA, 12 U.S.C. §§ 5531, 5536.

THE CFPA 30.

Sections 1031 and 1036(a)(1)(B) of the CFPA, 12 U.S.C. §§ 5531, 5536(a)(1)(B), prohibit “covered person[s]” or “service provider[s]” from engaging “in any unfair, deceptive, or abusive act or practice.” Section 1036(a)(1)(A) also prohibits “covered person[s]” or “service provider[s]” from “offer[ing] or provid[ing] to a consumer any financial product or service not in conformity with Federal consumer financial law, or otherwise commit any act or omission in violation of a Federal consumer financial law.” 12 U.S.C. § 5536(a)(1)(A). 31.

Section 1036(a)(3) of the CFPA further prohibits any person from “knowingly or recklessly provid[ing] substantial assistance to a covered person or service provider in violation of the provisions of section 1031 . . . and notwithstanding any provision of [the CFPA], the provider of such substantial assistance shall be deemed to be in violation of that section to the same extent as the person to whom such assistance is provided.” 12 U.S.C. § 5536(a)(3). 32.

Section 1002(25) defines the term “related person” to mean “any director, officer, or employee charged with managerial responsibility for, or controlling shareholder of,” or “any shareholder . . . or other person . . . who materially participates in the conduct of the affairs of” of a non-bank provider of a consumer financial product or service. 12 U.S.C. § 5481(25)(C). Section 1002(25) further provides that a “related person” shall be “deemed to mean a covered person for all purposes of any provision of Federal consumer financial law.” 12 U.S.C. § 5481(25)(B).

Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 8 of 12 Page ID #:8

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33.

Defendants are “covered person[s],” “service provider[s]” or “related person[s],” and they provided “substantial assistance” within the meaning of the CFPA. 12 U.S.C. §§ 5481(6), (25), (26), 5536(a)(3). COUNT I (Advance Fees in Violation of Regulation O) 34.

The allegations in paragraphs 1 to 33 are incorporated here by reference.

35.

In numerous instances, in the course of providing, offering to provide, or arranging for others to provide mortgage assistance relief services, Defendants have asked for or received payment from consumers before those consumers have executed a written agreement with the loan holder or servicer that incorporates the offer obtained by Defendants, in violation of Regulation O, 12 C.F.R. § 1015.5(a) (2011).

COUNT II (Misrepresentations in Violation of Regulation O) 36.

The allegations in paragraphs 1 to 33 are incorporated here by reference.

37.

In numerous instances, in the course of providing, offering to provide, or arranging for others to provide mortgage assistance relief services, Defendants have engaged in misrepresenting, expressly or by implication, material aspects of their services, including but not limited to: a.

the likelihood of obtaining mortgage loan modifications or accomplishing any other represented service or result, in violation of Regulation O, 12 C.F.R. § 1015.3(b)(1) (2011); b.

the amount of time it would take to obtain mortgage loan modifications or accomplish any other represented service or result, in violation of Regulation O, 12 C.F.R. § 1015.3(b)(2) (2011); and Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 9 of 12 Page ID #:9

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that consumers will receive legal representation, in violation of Regulation O, 12 C.F.R. § 1015.3(b)(8) (2011). COUNT III (Failure to Make Certain Disclosures in Violation of Regulation O) 38.

The allegations in paragraphs 1 to 33 are incorporated here by reference.

39.

In numerous instances, in the course of providing, offering to provide, or arranging for others to provide mortgage assistance relief services, Defendants: a.

violated Regulation O, 12 C.F.R. § 1015.4(a)(1) (2011), by failing to make the following disclosure in all general commercial communications: “Siringoringo Law Firm is not associated with the government, and our service is not approved by the government or your lender”; and b.

violated Regulation O, 12 C.F.R. § 1015.4(b)(1), (2) (2011), by failing to make the following disclosures in all consumer-specific commercial communications:

“You may stop doing business with us at any time. You may accept or reject the offer of mortgage assistance we obtain from your lender [or servicer]. If you reject the offer, you do not have to pay us. If you accept the offer, you will have to pay us (insert amount or method for calculating the amount) for our services.”; and ii.

“Siringoringo Law Firm is not associated with the government, and our service is not approved by the government or your lender.”

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COUNT IV (Deceptive Acts and Practices in Violation of the CFPA) 40.

The allegations in paragraphs 1 to 33 are incorporated here by reference.

41.

In numerous instances, in connection with the offering or provision of mortgage assistance relief services, Defendants have represented, expressly or by implication, that:

they generally will obtain mortgage loan modifications for consumers or will help them avoid foreclosure; b.

they generally will obtain such mortgage assistance relief within a certain time, such as 45 days; and c.

they will provide legal representation for consumers. 42.

In truth and in fact, Defendants generally do not obtain mortgage loan modifications for consumers, generally do not help them avoid foreclosure, generally provide no actual mortgage assistance relief within the represented time, and generally do not provide legal representation for consumers. These representations are material and likely to mislead a reasonable consumer at the time they were made.

43.

Therefore, Defendants’ representations as set forth in paragraph 41 constitute deceptive acts and practices in violation of sections 1031 and 1036 of the CFPA, 12 U.S.C. §§ 5531, 5536.

PRAYER FOR RELIEF WHEREFORE, the Bureau requests that the Court: a.

permanently enjoin Defendants from committing future violations of Regulation O and the CFPA and enter such other injunctive relief as appropriate;

Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 11 of 12 Page ID #:11

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award restitution, jointly and severally, against Defendants in the amount of all unlawfully collected fees; c.

order disgorgement of ill-gotten revenues against Defendants; d.

award civil money penalties against Defendants; e.

order the rescission or reformation of contracts where necessary to redress injury to consumers;

award costs against Defendants; and g.

award additional relief as the Court may determine to be just and proper.

Dated: July 22, 2014

Respectfully submitted,

Anthony Alexis Acting Enforcement Director Jeffrey Paul Ehrlich Deputy Enforcement Director John C. Wells Assistant Litigation Deputy

/s/ Maxwell S. Peltz

Maxwell S. Peltz Navid Vazire Enforcement Attorneys 1700 G Street NW Washington, DC 20552 Phone: (415) 633-1328 Fax: (415) 677-9954

Email: [email protected]

Attorneys for Plaintiff Consumer Financial Protection Bureau Case 2:14-cv-05681 Document 1 Filed 07/22/14 Page 12 of 12 Page ID #:12

Amended complaint (Jan. 2017)

PDF of this document (12 pages)

Page 14

First Amended Complaint for Permanent Injunction and Other Relief ANTHONY ALEXIS, DC Bar #384545

Email: [email protected] Phone: (202) 435-7999 JEFFREY PAUL EHRLICH, FL Bar #51561 Email: [email protected] Phone: (202) 435-7598 JOHN C. WELLS, DC Bar #491292 Email: [email protected] Phone: (202) 435-9319 MAXWELL S. PELTZ, CA Bar #183662 Email: [email protected] Phone: (415) 633-1328 1700 G Street, NW Washington, DC 20552 Fax: (415) 677-9954

Attorneys for Plaintiff Consumer Financial Protection Bureau

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, EASTERN DIVISION

Consumer Financial Protection Bureau,

Plaintiff,

Stephen Lyster Siringoringo, an individual, also d/b/a Siringoringo Law Firm; Clausen & Cobb Management Company, Inc., a corporation; and Joshua Cobb, an individual, Defendants.

Case No. 8:14-cv-01155-JVS

FIRST AMENDED COMPLAINT FOR PERMANENT INJUNCTION AND OTHER RELIEF

JURISDICTION AND VENUE 1.

This Court has subject-matter jurisdiction over this action because it is “brought under Federal consumer financial law,” 12 U.S.C. § 5565(a)(1), presents Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 1 of 12 Page ID #:1564

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First Amended Complaint for Permanent Injunction and Other Relief a federal question, 28 U.S.C. § 1331, and is brought by an agency of the United States, 28 U.S.C. § 1345.

PARTIES 4.

The Bureau is authorized to initiate federal district court proceedings, by its own attorneys, to enjoin violations of the CFPA and Regulation O, and to secure such relief as may be appropriate in each case. 12 U.S.C. §§ 5564(a)-(b), 5565. This includes the rescission or reformation of contracts, the refund of moneys paid, restitution, disgorgement or compensation for unjust enrichment, and civil money penalties. Id. § 5565(a)(2).

Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 2 of 12 Page ID #:1565

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First Amended Complaint for Permanent Injunction and Other Relief 6.

Defendant Stephen Lyster Siringoringo (Siringoringo) was the principal of Siringoringo Law Firm, a purported law firm with offices in San Bernardino County, Riverside County, Orange County, and Los Angeles County, all in California. Siringoringo has transacted business in this district. 7.

Defendant Clausen & Cobb Management Company, Inc. (CCMC) is a California corporation with an office in San Bernardino County, California. CCMC has transacted business in this district.

Defendant Joshua Cobb (Cobb) was an owner and manager of CCMC. Cobb has transacted business in this district.

Defendants Siringoringo, CCMC, and Cobb, each acting alone or in concert with others, offered or provided, or arranged for others to provide, “mortgage assistance relief services,” as defined in Regulation O (12 C.F.R. § 1015.2 (2011)), and “financial advisory services” within the meaning of the CFPA, 12 U.S.C. § 5481(15)(A)(viii), including but not limited to loanmodification and foreclosure-relief services.

10.

Cobb had managerial responsibility for CCMC and materially participated in the conduct of its affairs, including the development and approval of the purported mortgage assistance relief services described here. Cobb was intimately familiar with and directed CCMC’s operations, including its purported mortgage assistance relief services. Cobb knew of and approved all of the practices described in this Complaint.

SUMMARY OF COMPLAINT 11.

Beginning in or about December 2010, Defendants marketed and sold purported mortgage assistance relief services to consumers. Defendants attracted financially distressed homeowners through advertisements, mailings, and in-person consultations, deceptively promising loan modifications and foreclosure relief in exchange for advance fees. Defendants also misled consumers into believing that Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 3 of 12 Page ID #:1566

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First Amended Complaint for Permanent Injunction and Other Relief an attorney would represent them in negotiations with their lenders or servicers. In the end, consumers paid thousands of dollars each in advance fees, but in numerous instances received none of the promised services or relief. DEFENDANTS’ BUSINESS PRACTICES 12.

In or about December 2010, Defendants entered into an agreement under which CCMC – a company co-owned and co-managed by Cobb – provided staffing, marketing, office space, equipment, and general operational and administrative support to the Siringoringo Law Firm (SLF) – a purported law firm of which Siringoringo was the principal – in its offering of loan-modification services. Cobb actively directed and managed SLF’s operations, including managing staff and overseeing administrative functions; setting and enforcing policies and procedures; developing marketing; and setting fees and controlling office finances. Siringoringo did not typically have contact or involvement with clients or their lenders; those functions were left to non-attorney CCMC personnel. Client files typically lacked any documents written, authored, or signed by Siringoringo.

13.

Defendants heavily marketed SLF’s purported loan-modification services through television, radio, and internet advertisements, as well as direct mail and email solicitations, in both English and Spanish. A number of advertisements featured Siringoringo describing his skills, experience, and success in obtaining loan modifications. The advertisements deceptively suggested that SLF enjoyed high rates of success in obtaining loan modifications and other foreclosure relief and misled consumers into believing that they would receive the services of an attorney, Siringoringo.

14.

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First Amended Complaint for Permanent Injunction and Other Relief modification, that they would obtain a modification within 45 days, and that Siringoringo would directly negotiate with their lender or servicer to obtain the desired relief. CCMC personnel would present consumers with an SLF retainer agreement that also misleadingly suggested that they would be receiving the services of an attorney.

15.

Defendants enrolled thousands of consumers through these practices. 16.

17.

In numerous instances, after consumers paid Defendants’ advance fees, Defendants failed to answer or return consumers’ telephone calls and emails and failed to provide updates about the status of consumers’ loan-modification applications. In numerous instances, after consumers paid Defendants’ advance fees, Defendants failed to obtain loan modifications or foreclosure relief for consumers.

18.

In numerous instances, consumers received no representation by an attorney.

Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 5 of 12 Page ID #:1568

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First Amended Complaint for Permanent Injunction and Other Relief REGULATION O 19.

22.

Defendants were “mortgage assistance relief provider[s]” engaged in the provision of “mortgage assistance relief services” as those terms are defined in Regulation O. 12 C.F.R. § 1015.2 (2011).

23.

Regulation O prohibits any mortgage assistance relief service provider from requesting or receiving payment of any fee or other consideration until the consumer has executed a written agreement between the consumer and the Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 6 of 12 Page ID #:1569

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First Amended Complaint for Permanent Injunction and Other Relief consumer’s loan holder or servicer that incorporates the offer that the provider obtained from the loan holder or servicer. 12 C.F.R. § 1015.5(a) (2011). 24.

26.

27.

Under section 1097 of the CFPA, 12 U.S.C. § 5538, a violation of Regulation O constitutes an unfair, deceptive, or abusive act or practice under the Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 7 of 12 Page ID #:1570

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First Amended Complaint for Permanent Injunction and Other Relief CFPA, in violation of sections 1031 and 1036 of the CFPA, 12 U.S.C. §§ 5531, 5536.

THE CFPA 29.

32.

Defendants were “covered person[s],” “service provider[s]” or “related person[s],” and they provided “substantial assistance” within the meaning of the CFPA. 12 U.S.C. §§ 5481(6), (25), (26), 5536(a)(3). Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 8 of 12 Page ID #:1571

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First Amended Complaint for Permanent Injunction and Other Relief COUNT I (Advance Fees in Violation of Regulation O) Asserted Against All Defendants 33.

The allegations in paragraphs 1 to 32 are incorporated here by reference.

34.

In numerous instances, in the course of providing, offering to provide, or arranging for others to provide mortgage assistance relief services, Defendants asked for or received payment from consumers before those consumers had executed a written agreement with the loan holder or servicer that incorporated the offer obtained by Defendants, in violation of Regulation O, 12 C.F.R. § 1015.5(a) (2011).

COUNT II (Misrepresentations in Violation of Regulation O) Asserted Against CCMC and Cobb 35.

The allegations in paragraphs 1 to 32 are incorporated here by reference.

36.

In numerous instances, in the course of providing, offering to provide, or arranging for others to provide mortgage assistance relief services, Defendants engaged in misrepresenting, expressly or by implication, material aspects of their services, including but not limited to:

the likelihood of obtaining mortgage loan modifications or accomplishing any other represented service or result, in violation of Regulation O, 12 C.F.R. § 1015.3(b)(1) (2011); b.

the amount of time it would take to obtain mortgage loan modifications or accomplish any other represented service or result, in violation of Regulation O, 12 C.F.R. § 1015.3(b)(2) (2011); and Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 9 of 12 Page ID #:1572

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First Amended Complaint for Permanent Injunction and Other Relief c.

that consumers would receive legal representation, in violation of Regulation O, 12 C.F.R. § 1015.3(b)(8) (2011). COUNT III (Failure to Make Certain Disclosures in Violation of Regulation O) Asserted Against CCMC and Cobb 37.

The allegations in paragraphs 1 to 32 are incorporated here by reference.

38.

In numerous instances, in the course of providing, offering to provide, or arranging for others to provide mortgage assistance relief services, Defendants: a.

violated Regulation O, 12 C.F.R. § 1015.4(b)(1), (2) (2011), by failing to make the following disclosures in all consumer-specific commercial communications:

“Siringoringo Law Firm is not associated with the government, and our service is not approved by the government or your lender.”

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First Amended Complaint for Permanent Injunction and Other Relief COUNT IV (Deceptive Acts and Practices in Violation of the CFPA) Asserted Against CCMC and Cobb 39.

The allegations in paragraphs 1 to 32 are incorporated here by reference.

40.

In numerous instances, in connection with the offering or provision of mortgage assistance relief services, Defendants represented, expressly or by implication, that:

they generally would obtain mortgage loan modifications for consumers or would help them avoid foreclosure; b.

they generally would obtain such mortgage assistance relief within a certain time, such as 45 days; and c.

they would provide legal representation for consumers. 41.

In truth and in fact, Defendants generally did not obtain mortgage loan modifications for consumers, generally did not help them avoid foreclosure, generally provided no actual mortgage assistance relief within the represented time, and generally did not provide legal representation for consumers. These representations were material and likely to mislead a reasonable consumer at the time they were made.

42.

Therefore, Defendants’ representations as set forth in paragraph 40 constituted deceptive acts and practices in violation of sections 1031 and 1036 of the CFPA, 12 U.S.C. §§ 5531, 5536.

PRAYER FOR RELIEF WHEREFORE, the Bureau requests that the Court: a.

permanently enjoin Defendants from committing future violations of Regulation O and the CFPA and enter such other injunctive Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 11 of 12 Page ID #:1574

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First Amended Complaint for Permanent Injunction and Other Relief relief as appropriate;

award restitution, jointly and severally, against Defendants in the amount of all unlawfully collected fees; c.

order disgorgement of ill-gotten revenues against Defendants; d.

award civil money penalties against Defendants; e.

order the rescission or reformation of contracts where necessary to redress injury to consumers;

award costs against Defendants; and g.

award additional relief as the Court may determine to be just and proper.

Dated: January 4, 2017

Respectfully submitted,

Anthony Alexis Enforcement Director Jeffrey Paul Ehrlich Deputy Enforcement Director John C. Wells Assistant Litigation Deputy

/s/ Maxwell S. Peltz

Maxwell S. Peltz Senior Litigation Counsel 1700 G Street NW Washington, DC 20552 Phone: (415) 633-1328 Fax: (415) 677-9954

Email: [email protected]

Attorneys for Plaintiff Consumer Financial Protection Bureau Case 8:14-cv-01155-JVS-AJW Document 117 Filed 01/04/17 Page 12 of 12 Page ID #:1575

Judgment (Jan. 2017)

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ANTHONY ALEXIS, DC Bar #384545 Email: [email protected] Phone: (202) 435-7999 JEFFREY PAUL EHRLICH, FL Bar #51561 Email: [email protected] Phone: (202) 435-7598 JOHN C. WELLS, DC Bar #491292 Email: [email protected] Phone: (202) 435-9319 MAXWELL S. PELTZ, CA Bar #183662 Email: [email protected] Phone: (415) 633-1328 1700 G Street, NW Washington, DC 20552 Fax: (415) 844-9788

Attorneys for Plaintiff Consumer Financial Protection Bureau

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, SOUTHERN DIVISION

Consumer Financial Protection Bureau,

Plaintiff,

Stephen Lyster Siringoringo, an individual, also d/b/a Siringoringo Law Firm; Clausen & Cobb Management Company, Inc., a corporation; Alfred Clausen, an individual; and Joshua Cobb, an individual,

Defendants.

Case No. 8:14-cv-01155-JVS

DEFAULT JUDGMENT AND ORDER FOR PERMANENT INJUNCTION AND CIVIL MONEY PENALTIES AGAINST DEFENDANTS CLAUSEN & COBB MANAGEMENT COMPANY, INC., A CORPORATION; AND JOSHUA COBB, AN INDIVIDUAL

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Plaintiff Consumer Financial Protection Bureau (“CFPB” or “Bureau”) commenced this civil action on July 22, 2014, under sections 1031, 1036(a), 1054, and 1055 of the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5531, 5536(a), 5564, 5565, and under section 626 of the Omnibus Appropriations Act, 2009 (as amended by section 1097 of the CFPA), 12 U.S.C. § 5538, and its implementing regulation, the Mortgage Assistance Relief Services Rule (MARS Rule, or Regulation O), 12 C.F.R. Part 1015 (2011), in connection with Defendants’ marketing and sale of purported mortgage-assistance-relief services.

Defendants Clausen & Cobb Management Company, Inc., a corporation (CCMC), and Joshua Cobb, an individual (Cobb) failed to file an answer or otherwise defend this action. The Clerk entered defaults against defendants CCMC and Cobb on January 21, 2015 (Docket No. 28). The Bureau has filed a Notice of Application and Application for Entry of Default Judgment and Order for Permanent Injunction and Civil Money Penalties against defendants CCMC and Cobb (hereinafter Defaulting Defendants) pursuant to Fed. R. Civ. P. 55(b)(2) and Local Rules 55-1 and 55-2. The Court, having considered the Bureau’s Application, supporting declarations and exhibits, and the entire record in this matter, finds good cause to grant the relief requested in the Bureau’s Application. IT IS HEREBY ORDERED, ADJUDGED, AND DECREED as follows: FINDINGS 1.

When, as here, an action involves multiple defendants, a court may direct entry of a final judgment as to fewer than all defendants only if the court expressly determines that there is no just reason for delay. Fed.R.Civ.Proc. 54(b). Based on the following, the Court hereby determines that there is no just reason for delaying entry of final judgment against Defaulting Defendants. Upon entry of judgment against Defaulting Defendants, Plaintiff will amend the complaint to Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 2 of 12 Page ID #:1553

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remove Alfred Clausen as a defendant and withdraw all unadjudicated claims against codefendant Stephen Lyster Siringoringo, an individual, also d/b/a Siringoringo Law Firm (Siringoringo). The Court has adjudicated Siringoringo’s liability under Count I of the Complaint (Minute Order, Docket No. 80) and has awarded a civil money penalty and other relief against Siringoringo relating to that liability determination (Amended Minute Order Docket No. 108; Order, Docket No. 109). Accordingly, upon entry of judgment against Defaulting Defendants and subsequent amendment of the complaint – to drop Clausen and withdraw Counts II to IV against Siringoringo – no unadjudicated claims will remain against any party, a final judgment can be entered against Siringoringo, and the entire action will be concluded. Accordingly, there is no just reason for delay. 2.

This is an action by the Bureau instituted under Sections 1031, 1036(a), 1054, and 1055 of the CFPA, 12 U.S.C. §§ 5531, 5536(a), 5564, and 5565; and Regulation O, 12 C.F.R. Part 1015 (2011). The Complaint seeks permanent injunctive relief and civil money penalties. The Bureau has authority to seek this relief.

This Court has jurisdiction over the subject matter of this case and has jurisdiction over Defaulting Defendants, pursuant to 12 U.S.C. § 5565(a)(1) and 28 U.S.C. §§ 1331and 1345.

Venue in the Central District of California is proper under 28 U.S.C. §§ 1391(b) and 12 U.S.C. § 5564(f).

Defaulting Defendants have been properly served with the Summons and Complaint.

Defaulting Defendants have failed to answer or otherwise defend this action.

The Clerk of Court properly entered defaults against defendants CCMC and Cobb on January 21, 2015.

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Defaulting Defendants are not minors, incompetent persons, or current members of the military service.

Defaulting Defendants were served with written notice of the Application (via United Parcel Service – Next Day Air) on November 20, 2015, at least seven days before any hearing on the application. The written notice included the amount of civil penalties requested by Plaintiff. 10.

The Complaint states a claim upon which relief can be granted. 11.

Because of Defaulting Defendants’ default, the allegations in the Complaint filed in this action are taken as true. 12.

Judgment is entered against Defaulting Defendants, in favor of Plaintiff, on Counts I through IV.

13.

Section 1055 of the CFPA, 12 U.S.C. § 5565, empowers this Court to order injunctive relief and civil money penalties. 14.

The Bureau is entitled to an Order imposing a permanent injunction and requiring Defaulting Defendants to pay a civil money penalty in the amount of $12,000,000.00.

15.

This action and the relief awarded herein are in addition to, and not in lieu of, other remedies as may be provided by law, including both civil and criminal remedies.

16.

Entry of this Order is in the public interest. Advance Fees in Violation of Regulation O (Count I) 17.

Defaulting Defendants unlawfully charged consumers advance fees for purported mortgage-assistance-relief services in violation of Regulation O. Defaulting Defendants charged and collected thousands of dollars in fees – an initial fee of between $1,995 and $3,500 and a monthly fee of $495 – before obtaining an executed written agreement between the consumer and the Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 4 of 12 Page ID #:1555

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consumer’s dwelling loan holder or servicer. (Compl. ¶ 17.) See 12 CFR § 1015.5(a).

Misrepresentations in Violation of Regulation O (Count II) 18.

Defaulting Defendants made misrepresentations in violation of Regulation O. Defaulting Defendants misleadingly suggested that they enjoyed high rates of success in obtaining loan modifications, misled consumers into believing they would obtain a modification within 45 days, and misled consumers into believing they would receive the services of an attorney. (Compl. ¶¶ 14-15.) In numerous instances, consumers received no representation by an attorney, and in numerous instances consumers never received loan modifications, let alone within 45 days. (Id. ¶¶ 18-19.) See 12 CFR § 1015.3(b)(1), (2), (8). Failure to Make Disclosures in Violation of Regulation O (Count III) 19.

Defaulting Defendants failed to make required disclosures in violation of Regulation O. Defaulting Defendants never disclosed that they were not associated with the government and that their purported mortgage-assistance-relief services were not approved by the government or the consumer’s lender. (Compl. ¶ 17.) Defaulting Defendants also never disclosed that consumers could cease doing business with Defaulting Defendants without paying for their purported mortgage-assistance-relief services. (Id.) See 12 CFR § 1015.4(a)(1), (b)(1)-(2). Deceptive Acts and Practices in Violation of the CFPA (Count IV) 20.

Defaulting Defendants engaged in deceptive acts and practices in violation of the CFPA. Defaulting Defendants heavily marketed their purported loan-modification services to financially distressed consumers, representing that an attorney would represent consumers when no attorney actually represented them. (Compl. ¶¶ 12,14-15.) Defaulting Defendants also represented to consumers that they would obtain a loan modification within 45 days, when such modifications Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 5 of 12 Page ID #:1556

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generally did not materialize within that period, if at all. (Compl. ¶¶ 15, 18.) See 12 U.S.C. §§ 5531, 5536.

Basis for Equitable and Monetary Relief 21.

As described above, Defaulting Defendants unlawfully charged and collected unlawful fees from thousands of financially distressed consumers – in many instances providing none of the promised relief. If Defaulting Defendants were to renew these activities, other potential victims could suffer similar harm. Were Defaulting Defendants free to return to their old ways, future victims may receive only a fraction of monetary damages to compensate them for injuries, particularly in light of the multitude of victims ensnared in the original scheme. Considering the balance of hardships and the public interest, the public interest is served by an injunction that reasonably “fences in” Defaulting Defendants from engaging in behavior related to their previous illegal conduct. Cf. FTC v. Colgate- Palmolive Co., 380 U.S. 374, 395 (1965). Accordingly, the permanent injunction ordered in Sections I-IV, infra, is “appropriate . . . equitable relief.” 12 U.S.C. §§ 5564, 5565.

22.

The penalty amount ordered in Section V, infra, is based on an estimated 2,400 consumers who paid the Defaulting Defendants advance fees between July 2011 and July 2013, but received no loan modification. A first-tier penalty amount of $5,000 multiplied by this number of consumers yields a penalty of $12,000,000. See 12 U.S.C. § 5565(c)(2)(A).

23.

This penalty is conservative. First, it is based only on the number of consumers who paid advance fees but received no loan modification. However, Defaulting Defendants violated the law every time they charged or collected fees from a consumer before execution of a written loan-modification agreement with the dwelling loan holder or servicer – regardless of whether such an agreement was ultimately obtained. Uncontroverted evidence establishes that as of January 2012, Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 6 of 12 Page ID #:1557

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Defaulting Defendants had already collected such advance fees from over 4,000 consumers. (Henderson Decl. Supp. Appl. Default J. ¶¶ 9, 13.) Second, the penalty is based on a first-tier amount of $5,000, when uncontroverted evidence could establish that Defaulting Defendants be penalized at higher penalty tiers. Cf. 12 U.S.C. § 5565(c)(2)(B) ($25,000 per day for reckless violations); 12 U.S.C. § 5565(c)(2(C) ($1,000,000 per day for knowing violations). 24.

There is no evidence in the record supporting the application of any mitigating factors under 12 U.S.C. § 5562(c)(2)(3), particularly in light of the conservative penalty calculation detailed above. DEFINITIONS For the purposes of this Order, the following definitions shall apply: 1.

“Consumer financial product or service” has the same meaning as in section 1002(5) and (15) of the CFPA, 12 U.S.C. § 5481(5) and (15). 2.

“Mortgage-assistance-relief product or service” means any product, service, plan, or program, offered or provided to the consumer in exchange for consideration, that is represented, expressly or by implication, to assist or attempt to assist the consumer with any of the following: a.

stopping, preventing, or postponing any mortgage or deed of trust foreclosure sale for the consumer’s dwelling, any repossession of the consumer’s dwelling, or otherwise saving the consumer’s dwelling from foreclosure or repossession;

negotiating, obtaining, or arranging a modification of any term of dwelling loan, including a reduction in the amount of interest, principal balance, monthly payments, or fees; c.

obtaining any forbearance or modification in the timing of payments from any dwelling loan holder or servicer on any dwelling loan;

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negotiating, obtaining, or arranging any extension of the period of time within which the consumer may (i) cure his or her default on a dwelling loan, (ii) reinstate his or her dwelling loan, (iii) redeem a dwelling, or (iv) exercise any right to reinstate a dwelling loan or redeem a dwelling;

obtaining any waiver of an acceleration clause or balloon payment contained in any promissory note or contract secured by any dwelling; or f.

negotiating, obtaining, or arranging (i) a short sale of a dwelling, (ii) a deed in lieu of foreclosure, (iii) or any other disposition of a dwelling loan other than a sale to a third party that is not the dwelling loan holder.

ORDER I.

BAN ON MORTGAGE-ASSISTANCE-RELIEF PRODUCTS AND SERVICES IT IS HEREBY ORDERED that the Defaulting Defendants, whether acting directly or indirectly, are permanently enjoined from: 1.

Advertising, marketing, promoting, offering for sale, or selling any mortgage-assistance-relief product or service; and 2.

Assisting others engaged in advertising, marketing, promoting, offering for sale, or selling any mortgage-assistance-relief product or service. II.

PROHIBITED MISREPRESENTATIONS IT IS FURTHER ORDERED that the Defaulting Defendants and their officers, agents, servants, employees, and attorneys, and those persons in active concert or participation with any of them, who receive actual notice of this Order, Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 8 of 12 Page ID #:1559

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whether acting directly or indirectly, in connection with the marketing performance, or sale of any consumer financial product or service, are permanently enjoined from misrepresenting, or assisting others in misrepresenting, expressly or by implication, any material fact, including but not limited to: 1.

The likelihood of a consumer’s receiving a consumer financial product or service;

That a consumer will receive a consumer financial product or service within a certain period of time;

That a consumer will receive representation by an attorney; and 4.

Any material fact relating to any consumer financial product or service.

III.

CUSTOMER INFORMATION – PROHIBITION ON USE; DISPOSAL IT IS FURTHER ORDERED that the Defaulting Defendants and their officers, agents, servants, employees, and attorneys, and those persons in active concert or participation with any of them, who receive actual notice of this Order, whether acting directly or indirectly, are permanently enjoined from using, disclosing, or benefitting from any customer information obtained prior to entry of this Order in connection with the advertising, sale, or provision of a mortgageassistance-relief service.

IT IS FURTHER ORDERED that officers, agents, servants, employees, and attorneys of the Defaulting Defendants, and those persons in active concert or participation with the Defaulting Defendants, who receive actual notice of this Order and who have actual control over any customer information obtained prior to entry of this Order shall dispose of such customer information within thirty (30) days after entry of this Order. Disposal must protect against unauthorized access to the information, such as by shredding papers or destroying electronic media. Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 9 of 12 Page ID #:1560

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IV.

PROHIBITION ON COLLECTING ACCOUNTS IT IS FURTHER ORDERED that Defaulting Defendants and their officers, agents, servants, employees, attorneys, and those persons in active concert or participation with any of them, who receive actual notice of this Order, whether acting directly or indirectly, are permanently enjoined from collecting payment from any consumer who purchased or agreed to purchase mortgage-assistancerelief products or services from Defaulting Defendants. V.

ORDER TO PAY CIVIL MONEY PENALTY

IT IS FURTHER ORDERED that:

Under Section 1055(c) of the CFPA, 12 U.S.C. § 5565(c), by reason of the violations of law described above on page 6, paragraph 22, and taking into account the factors in 12 U.S.C. § 5565(c)(3), a judgment awarding a civil money penalty in the amount of $12,000,000.00 is entered against the Defaulting Defendants, jointly and severally, with post-judgment interest at the legal rate. This monetary judgment is enforceable against any asset owned by, on behalf of, for the benefit of, or in trust by or for, the Defaulting Defendants. 2.

The civil money penalties paid pursuant to this Order shall be deposited in the Civil Penalty Fund of the CFPB in accordance with Section 1017(d) of the CFPA, 12 U.S.C. § 5497(d).

VI.

OTHER MONETARY PROVISIONS IT IS FURTHER ORDERED that:

Defaulting Defendants must relinquish all dominion, control, and title to any funds paid pursuant to this Order to the fullest extent permitted by law and no part of the funds may be returned to Defaulting Defendants. Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 10 of 12 Page ID #:1561

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Defaulting Defendants must treat the civil money penalty paid under this Section as a penalty paid to the government for all purposes. 3.

Defaulting Defendants shall not seek or accept, directly or indirectly, reimbursement or indemnification from any source, including any insurance policy, with regard to any civil money penalty paid pursuant to this Order. 4.

Defaulting Defendants shall not claim, assert, or apply for a tax deduction or tax credit with regard to any federal, state, or local tax for any civil money penalty that Defaulting Defendants pay pursuant to this Order. VII.

ORDER ACKNOWLEDGMENTS IT IS FURTHER ORDERED:

Within twenty-one (21) days of service of this Order, each Defaulting Defendant must submit to the Bureau an acknowledgment, sworn under penalty of perjury, that he received this Order. The acknowledgement shall be sent by firstclass mail to the below address:

Assistant Director for Enforcement Consumer Financial Protection Bureau ATTENTION: Maxwell Peltz, Office of Enforcement 1700 G Street, N.W.

Washington D.C. 20552 VIII.

RETENTION OF JURISDICTION IT IS FURTHER ORDERED that this Court retains jurisdiction of this matter for purposes of construction, modification, and enforcement of this Order. Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 11 of 12 Page ID #:1562

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IX.

SERVICE

IT IS FURTHER ORDERED that this Order may be served upon Defaulting Defendants by certified mail, either by the United States Marshal, the Clerk of the Court, or any representative or agent of the Bureau.

IT IS SO ORDERED, on January 03, 2017.

_________________________________

THE HONORABLE JAMES V. SELNA United States District Judge Case 8:14-cv-01155-JVS-AJW Document 116 Filed 01/03/17 Page 12 of 12 Page ID #:1563

Judgment (Jan. 2017)

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ANTHONY ALEXIS, DC Bar #384545 Email: [email protected] Phone: (202) 435-7999 JEFFREY PAUL EHRLICH, FL Bar #51561 Email: [email protected] Phone: (202) 435-7598 JOHN C. WELLS, DC Bar #491292 Email: [email protected] Phone: (202) 435-9319 MAXWELL S. PELTZ, CA Bar #183662 Email: [email protected] Phone: (415) 633-1328 1700 G Street, NW Washington, DC 20552 Fax: (415) 844-9788

Attorneys for Plaintiff Consumer Financial Protection Bureau

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, SOUTHERN DIVISION

Consumer Financial Protection Bureau,

Plaintiff,

Stephen Lyster Siringoringo, an individual, also d/b/a Siringoringo Law Firm; Clausen & Cobb Management Company, Inc., a corporation; and Joshua Cobb, an individual,

Defendants.

Case No. 8:14-cv-01155-JVS (AJWx)

FINAL JUDGMENT AND ORDER FOR RESTITUTION, DISGORGEMENT, A CIVIL MONEY PENALTY, AND PERMANENT INJUNCTION AGAINST DEFENDANT STEPHEN LYSTER SIRINGORINGO, AN INDIVIDUAL, ALSO D/B/A SIRINGORINGO LAW FIRM

Plaintiff Consumer Financial Protection Bureau (“CFPB” or “Bureau”) commenced this civil action against Defendant Stephen Lyster Siringoringo, an individual, also d/b/a Siringoringo Law Firm (“Siringoringo”), on July 22, 2014, JS-6 Case 8:14-cv-01155-JVS-AJW Document 120 Filed 01/11/17 Page 1 of 7 Page ID #:1593

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asserting, among other claims, that Siringoringo had charged and collected advance fees for mortgage-assistance-relief services in violation of Regulation O, 12 C.F.R. Part 1015 (2011).

On December 18, 2015, the Court granted the Bureau’s motion for partial summary judgment against Siringoringo as to his liability under Count I of the Complaint: violation of Regulation O. (Minute Order, Docket No. 80.) On October 26, 2016, the Court granted the Bureau’s subsequent motion for partial summary judgment against Siringoringo as to the monetary and injunctive relief to be ordered for the violations asserted in Count I. (Amended Minute Order, Docket No. 108; Order, Docket No. 109.) On January 4, 2017, having obtained prior leave of Court (Docket No. 115), the Bureau filed a First Amended Complaint (Docket No. 117). The First Amended Complaint asserts a single claim against Siringoringo: Count I – violation of Regulation O – the remaining claims against Siringoringo having been withdrawn. Pursuant to the above-referenced orders granting partial summary judgment against Siringoringo as to Count I and in light of the Bureau’s withdrawal of all remaining claims against Siringoringo,1 IT IS HEREBY ORDERED, ADJUDGED, AND DECREED as follows: FINDINGS 1.

The Bureau brought this action against Siringoringo under Sections 1054 and 1055 of the CFPA, 12 U.S.C. §§ 5564 and 5565, and Regulation O, 12 C.F.R. Part 1015 (2011).

1 Default Judgment was entered against all remaining codefendants on January 3, 2017. (Docket No. 116.) Case 8:14-cv-01155-JVS-AJW Document 120 Filed 01/11/17 Page 2 of 7 Page ID #:1594

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Under 12 U.S.C. § 5565, the Bureau has authority to seek restitution, disgorgement, a civil money penalty, and a permanent injunction against Siringoringo, and the Court is empowered to order such relief. 3.

This Court has jurisdiction over the subject matter of this action and has jurisdiction over Siringoringo under 12 U.S.C. § 5565(a)(1) and 28 U.S.C. §§ 1331 and 1345.

Venue in the Central District of California is proper under 28 U.S.C. § 1391(b) and 12 U.S.C. § 5564(f).

The First Amended Complaint states a claim upon which relief can be granted against Siringoringo.

This action and the relief ordered herein are in addition to, and not in lieu of, other remedies as may be provided by law, including both civil and criminal remedies.

DEFINITIONS The following definitions shall apply to this Order: 1.

“Affected consumers” means all consumers who, from July 22, 2011 through July 26, 2013, paid a fee to Siringoringo for a mortgage-assistance-relief product or service.

“Related consumer action” means a private action by or on behalf of one or more consumers or an enforcement action by another governmental agency brought against Siringoringo based on substantially the same facts as described in the First Amended Complaint.

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negotiating, obtaining, or arranging a modification of any term of a dwelling loan, including a reduction in the amount of interest, principal balance, monthly payments, or fees; c.

obtaining any forbearance or modification in the timing of payments from any dwelling loan holder or servicer on any dwelling loan;

obtaining any waiver of an acceleration clause or balloon payment contained in any promissory note or contract secured by any dwelling; or f.

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ORDER I.

RESTITUTION, DISGORGEMENT, AND CIVIL PENALTY IT IS HEREBY ORDERED that:

Restitution and Disgorgement: Judgment for equitable monetary relief is hereby entered in favor of the Bureau and against Siringoringo in the amount of twenty million, eight hundred and twenty-five thousand dollars ($20,825,000) as restitution to the affected consumers for the unlawful fees charged and collected by Siringoringo and as disgorgement by Siringoringo of unjust gains from such fees. 2.

Civil Penalty: By reason of the violations alleged in the First Amended Complaint, and taking into account the factors in 12 U.S.C. § 5565(c)(3), judgment for a civil money penalty is entered in favor of the Bureau and against Siringoringo in the amount of one dollar ($1). II.

OTHER MONETARY PROVISIONS IT IS FURTHER ORDERED that:

The monetary judgment set forth above in Section I a.

is immediately due and payable upon entry of this Final Judgment and Order with post-judgment interest accruing at the legal rate; and b.

is enforceable against any asset owned by, on behalf of, for the benefit of, or in trust by or for Siringoringo. 2.

Siringoringo must relinquish all dominion, control, and title to any funds paid pursuant to this Final Judgment and Order to the fullest extent permitted by law, and Siringoringo shall make no claim to or demand for return of the funds or any part of the funds, directly or indirectly. Case 8:14-cv-01155-JVS-AJW Document 120 Filed 01/11/17 Page 5 of 7 Page ID #:1597

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Any funds received by the Bureau in satisfaction of this Final Judgment and Order will be deposited as follows: a.

The Bureau will deposit funds paid for restitution and disgorgement into a fund or funds administered by the Bureau or its agent, according to applicable statutes and regulations, to be used for redress for affected consumers, including but not limited to restitution, disgorgement, or other monetary relief, and for any attendant expenses for the administration of any such redress. If the Bureau determines, in its sole discretion, that redress to consumers is wholly or partially impracticable or if funds remain after redress is completed, the Bureau will deposit any remaining funds in the U.S. Treasury as disgorgement. Siringoringo will have no right to challenge any actions that the Bureau or its representatives may take under this Section.

The Bureau will deposit funds paid for the civil money penalty into the Civil Penalty Fund of the Bureau as required by 12 U.S.C. § 5497(d).

Within 30 days of the entry of a final judgment, consent order, or settlement in a related consumer action, Siringoringo must notify the Bureau of the final judgment, consent order, or settlement in writing. That notification must indicate the amount of redress, if any, that Siringoringo paid or is required to pay to consumers and describe the consumers or classes of consumers to whom that redress has been or will be paid.

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III.

BAN ON MORTGAGE-ASSISTANCE-RELIEF PRODUCTS AND SERVICES IT IS FURTHER ORDERED that Siringoringo, whether acting directly or indirectly, is permanently enjoined from: 1.

advertising, marketing, promoting, offering for sale, or selling any mortgage-assistance-relief product or service; and 2.

assisting others engaged in advertising, marketing, promoting, offering for sale, or selling any mortgage-assistance-relief product or service. IV.

RETENTION OF JURISDICTION IT IS FURTHER ORDERED that this Court retains jurisdiction of this matter for purposes of construction, modification, and enforcement of this Order. V.

SERVICE

IT IS FURTHER ORDERED that this Order may be served upon Siringoringo by certified mail, by the United States Marshal, the Clerk of the Court, or any representative or agent of the Bureau.

IT IS SO ORDERED, on January 11, 2017.

______________________________

HONORABLE JAMES V. SELNA United States District Judge Case 8:14-cv-01155-JVS-AJW Document 120 Filed 01/11/17 Page 7 of 7 Page ID #:1599