Roseville Woman Sentenced in Mortgage Fraud Scheme, Will Pay More Than $60,000 in Restitution

LANSING – (RealEstateRama) — Michigan Attorney General Bill Schuette today announced that Asima Khan, of Roseville, was sentenced on one felony count of Larceny $1,000 – $20,000, for her role in running a mortgage modification scam across Oakland and Macomb Counties.

“We see this time and time again, good people who have fallen on difficult times are taken advantage of by an individual who sees nothing but dollar signs,” said Schuette. “I am pleased to see this case resolved, but I will continue to seek justice and restitution for victims of this type of crime.”

Khan, 35, was sentenced on October 27, 2016 in the 16th Circuit Court in Macomb County before the Honorable Diane M. Druzinski.

Khan has been sentenced to 12 days in jail, followed by 5 years probation. She is also required to pay $60,387.24 in restitution to her victims.

Case Background

The Department of Attorney General’s Corporate Oversight Division began an investigation into Asima Khan and her company Financial Independent Services after receiving multiple complaints from victims in this case in 2015.

Asima Khan and her company, Financial Independent Services, provided mortgage modification services in Oakland and Macomb County. Khan promised mortgage modifications and debt consolidation to her clients. However, she collected money for the services in advance in violation of Michigan law and did not provide the promised modifications or debt reduction.

Khan’s company ceased operation in early 2014.

Foreclosure Rescue Scam Victim Restitution Fund

In August 2013 Schuette announced the launch of a $7.5 million Foreclosure Rescue Scam Victim Restitution fund as a part of the Homeowner Protection Fund monies received by the State of Michigan to resolve the National Mortgage Settlement.  This program is intended to provide restitution payments for victims of foreclosure scams who would otherwise never see a penny of court-ordered restitution.  To date over $4.1 million has been paid to Michigan victims of mortgage related crimes.

For more information on the mortgage settlement, including a consumer alert and a Frequently Asked Questions document available for download on the Attorney General’s website.

Foreclosure and Credit Assistance

Ever since the home mortgage foreclosure crisis, many unscrupulous businesses have taken advantage of consumers with false promises to help consumers keep their homes.  Scam artists prey on the vulnerability of desperate homeowners in order to collect handsome fees — but don’t deliver any of the promised services.  Many of these shady operations engage in high-pressure sales tactics and demand substantial fees in advance.

If you are behind on your mortgage payments and facing foreclosure, watch out for fraudulent foreclosure consultants who target distressed homeowners.  The following tips can help you avoid being scammed.

RED FLAGS – Avoid working with anyone who does any of the following:

  • Guarantees to stop the foreclosure process – no matter what the circumstances.
  • Instructs you not to contact your lender, your lawyer, or a credit or housing counselor.
  • Collects a fee up front before completing all services.  This practice may be illegal in many circumstances in Michigan under the Credit Services Protection Act.
  • Encourages you to lease or rent your home so you can buy it back over time.
  • Tells you to make your mortgage payments directly to them, rather than to your lender.
  • Tells you to transfer your property deed or title to them.
  • Offers to fill out paperwork for you.
  • Pressures you to sign paperwork that you haven’t had a chance to read thoroughly or that you don’t understand.

What You Can Do To Avoid Being a Victim: 

  1. DON’T sign any documents without reading and understanding them first. 
  2. DON’T transfer title or sell your home to the foreclosure rescuer.
  3. DON’T pay money to a foreclosure rescuer before any work has been done. 
  4. DON’T ignore letters from your lender/loan servicer.  Your loan servicer is the company that processes your mortgage payments.  (Sometimes the company you borrowed money from will continue to service the loan, but often the company that you borrowed the money from and the company you make your loan payments to are different).  You should contact your lender/loan servicer if you are having trouble making your payments on time. Many will work with homeowners who are behind on their payments to help them avoid foreclosure.
  5. DON’T pay your mortgage payments to someone other than your lender/loan servicer, even if that person promise to pass the payment on to the lender/loan servicer.
  6. DO contact HUD at 800-569-4287 or the Michigan State Housing Development Authority at for a referral to a housing counselor near you.  

Michigan Credit Protection Act

The Michigan Credit Services Protection Act protects consumers by requiring most businesses that offer to prevent foreclosures or modify mortgage loans to complete the services before collecting money from the consumer.  In other words, a credit services organization may not charge a fee in advance. It is Illegal to Demand Payment Before Completing Services

Under Michigan’s Credit Services Protection Act, it is illegal for most companies and individuals to charge or receive a fee before completing any of the following services:

  • Offering advice or assistance for avoiding foreclosures on a home mortgage.
  • Negotiating with creditors on the consumer’s behalf to defer or lower payments.
  • Taking steps to improve, offering advice or assistance for improving, a consumer’s credit records, history, or rating.
  • Obtaining credit or a loan, or offering advice or assistance in obtaining credit or a loan, on behalf of a consumer.
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