A class action lawsuit seeking to recover millions of dollars in home equity allegedly bilked from hundreds of distressed homeowners in Maryland, Virginia and Washington was shifted to federal court yesterday, broadening its scope to multiple jurisdictions.
The 76-page suit, filed in U.S. District Court in Greenbelt, targets Metropolitan Money Store Corp. of Lanham and other defendants and supplants a similar lawsuit filed in Prince George's County Circuit Court last month. Lawyers who prepared both suits yesterday asked that the state suit be dismissed.
"As we kept investigating the case, it became clear that there were also federal charges to be asserted," said Scott C. Borison, an attorney with Legg Law Firm LLC in Frederick, which filed the lawsuit along with Civil Justice Inc., a Baltimore legal help group, and the Holland Law Firm PC, of Annapolis. "It was just better to go forward in federal court."
The lawsuit alleges violations of federal racketeering and real estate settlement laws and seeks unspecified damages for equity allegedly stolen from homeowners who thought they were being rescued from foreclosure. Under federal law those amounts can be tripled. It also charges the defendants with money laundering to evade taxes.
"Metropolitan Money Store was out stealing the equity in people's homes and on top of that, getting it tax free," said Borison.
Estimates of the number of people in the region caught up in the scheme range from 275 to 400.
Each is believed to have lost at least $85,000 in equity, Borison said.
Filed on behalf of three Prince George's County families, the new lawsuit covers everyone who was tricked into conveying the title of their properties, not just those in foreclosure, said Phillip R. Robinson, executive director of Civil Justice.
"It's just bigger than what we thought it was initially," he said. "Referrals come in every day. We're just getting inundated with calls."
His office received two referrals yesterday alone from the Maryland attorney general's office, he said.
In addition to Metropolitan Money Store, which billed itself as a foreclosure consultant and credit services business, the suit names its resident agent Jennifer McCall, of Beltsville; Joy Jenis Jackson, of Fort Washington, who participated in operating the company; Fordham and Fordham Investment Group Ltd., of Lanham and Kurt Fordham, of Beltsville, who took part in operating that company.
