Mortgage-help firm denies wrongdoing in AG suit

A Tucson company and its owner have denied wrongdoing in a state consumer-fraud lawsuit alleging the company failed to provide mortgage-help services as promised and withheld funds.

Attorney General Mark Brnovich sued Hodgin & Co. LLC and Sonia Hodgin in February, alleging they fraudulently charged struggling homeowners thousands of dollars for foreclosure assistance services that were not delivered.

Hodgin’s initital answer to the suit denies the “very general” claims made by the attorney general and demands a trial, the company’s attorney, Michael Fleishman, said in a news release issued by Hodgin.

The company looks forward to examining documents and witnesses in the case, and to showing “documentation of full and adequate disclosures that were made to the alleged victims,” he said.

“Many of Hodgin & Co. LLC’s investments are designed to provide homeowners and investors who own distressed properties — properties encumbered by debt that exceeds the fair market value of the property — with creative and unique solutions that are unavailable in the traditional markets,” Fleishman said.

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The state’s civil lawsuit alleges Hodgin and her company misrepresented the nature of fees charged for their services and withheld payments intended to avoid foreclosures.

In one case, the attorney general said, the company agreed to assume the homeowner’s mortgage loan obligation to help a client avoid foreclosure but failed to do so, resulting in the servicer foreclosing on the property.

The defendants also entered into agreements with separate consumers to sell the same property to purchasers, charging the buyers a down payment and monthly payments, but failed to pay the underlying mortgage loans and continued to accept monthly payments even after foreclosure proceedings were started, the attorney general said.

State records show Hodgin surrendered her real-estate license in 2014, in lieu of further undisclosed disciplinary proceedings, and her company’s license has been terminated.

The state is seeking consumer restitution, reimbursement for the cost of the investigation, and attorneys’ fees, along with civil penalties of up to $10,000 per violation of state fraud laws.