Home → Consumer Credit Home Page → Enforcement → Enforcement Action
Granite Law California LLP; 7545 Irvine Center Drive, Ste 200; Irvine, CA 92618 - Cease and Desist Order and Affirmative order for Sanctions
December 6, 2013
WHEREAS the Bureau of Consumer Credit Protection (the Bureau) is an agency of the State of Maine authorized and designated to administer the Maine Consumer Credit Code, Title 9-A of the Maine Revised Statutes, and the Maine Debt Management Services Act, 32 M.R.S. ?? 6172-6183; and
WHEREAS the Superintendent of the Bureau, acting as the administrator of the Maine Consumer Code and the Maine Debt Management Services Act, has determined that notice and hearing need not be provided prior to the issuance of a cease and desist order based on the need for immediate action to protect the public interest, pursuant to 9-A M.R.S. ? 6-108(1); and
WHEREAS Respondent Granite Law California, LLP (Granite Law) has engaged in activities or offered to assist consumers for purposes that are within the ambit of debt management services as defined by 32 M.R.S. ? 6172(2)(A)-(D), as further specified below; and
WHEREAS Respondent Granite Law is not registered by the Bureau as a debt management service provider, and does not possess a surety bond, pursuant to 32 M.R.S. ?? 6173(2), 6174; and
WHEREAS on June 19, 2013, the Bureau received a complaint from K. E. H. of Corinth, Maine, and the Bureau staff thereafter spoke to K. E. H. and learned the following:
- In the winter of 2013, K. E. H. was interested in obtaining relief from her mortgage loan obligation with Maine Savings FCU in Hampden, Maine, and she found Granite Law on-line as a possible source of assistance;
- K. E. H. and her fianc? spoke by telephone to a representative of Granite Law and were told, according to K. E. H., that Granite Law would not take a case unless it was ?pretty sure? it could obtain a loan modification for her;
- On February 18, 2013, K. E. H. by personal check paid Granite Law $1,750 for its services;
- K. E. H. subsequently received a ?retainer agreement,? which she signed on April 15, 2013, and which Granite Law described as covering ?legal services? that included Granite Law agreeing to review K. E. H.?s income documentation and mortgage statement, developing a financial summary, conducting a pre-bankruptcy analysis and attorney review, consulting with K.E. H. regarding her supporting documentation, and preparing and transmitting to her lender a third-party authorization and ?loan solution package? after an attorney review;
- In return for K. E. H. cooperating with Granite Law, the retainer agreement specifically promised that Granite Law would ?assign qualified personnel, in its sole discretion, to various aspects of the case . . . in compliance with all applicable rules of professional conduct,? but did not ?promise or guarantee? Granite Law?s ?obtaining a particular outcome or result?; and
- Within only several days of signing the retainer agreement, K. E. H. received from Maine Savings FCU a denial of a request for loss mitigation, which suggested to K. E. H. that Granite Law had done nothing for her; and
WHEREAS on August 19, 2013, the Bureau staff wrote Granite Law to demand a refund of the money, $1,750, that K. E. H. had paid and to notify Granite Law that its business was being conducted in violation of the Maine Debt Management Services Act; and
WHEREAS on August 30, 2013, the managing partner for Granite Law wrote the Bureau that K. E. H.?s ?allegations are not only false but she knows they are false? and her ?complaint is unfounded?; that Granite Law had been hired, not to modify K. E. H.?s mortgage loan or obtain any specific result, but only to submit a loan modification request to her lender; that it had delivered such a request to her lender; that it had had several contacts with Maine Savings FCU (which it set forth in detail); and that it disagreed with the Bureau staff?s conclusion that it was acting in violation of Maine law because a Maine- licensed lawyer, Jeremey Miller, Esq. is a partner of Granite Law and, in this case, ?oversaw the file and actively participated in the services for which we were hired?; and
WHEREAS that the Bureau staff, with K. E. H.?s permission, spoke with two representatives of Maine Savings FCU or its loan servicer, both of whom disputed in material respects the statements in Granite Law?s letter of August 30, 2013, that detailed Granite Law?s dealings with Maine Savings FCU, by their stating, among other things, (from the loan representative of Maine Savings FCU) that she had told Granite Law that she would not discuss K. E H.?s finances with Granite Law without proof from Granite Law that it was licensed to practice law in Maine, and that she had not told Granite Law that K. E. H. had been untruthful in reporting her income; and (from the representative of Cuso Mortgage Corp., Maine Savings FCU?s loan servicer) that she had ever spoken to anyone from Granite Law and that K. E. H.?s loan was at all times current; and
WHEREAS neither representative of Maine Savings FCU and Cuso Mortgage Corp. had ever heard of Jeremey Miller; and
WHEREAS the Bureau staff, by letter of November 6, 2013, wrote again to Granite Law to assert its conclusion that it was acting in violation of the Maine Debt Management Services Act; that, in the staff?s opinion, Mr. Miller?s employment with Granite Law does not exempt Granite Law from compliance with the Act; and that K. E. H?s $1,750 should be returned to her; and
WHEREAS as of this date Granite Law has not responded to the Bureau staff?s letter of November 6, 2013.
NOW THEREFORE it is hereby
ORDERED that Granite Law shall forthwith cease and desist from engaging in conduct, or offering to perform on behalf of any Maine consumer any service, within the ambit of the Maine Debt Management Services Act, 32 M.R.S. ? 6172(2)(A)-(D), pursuant to 9-A M.R.S. ? 6-108(1), unless or until Granite Law is properly registered to perform or to offer such services; and it is further
ORDERED that Granite Law shall, within 14 days of the date of this Order, pay to the ?Treasurer, State of Maine? $1,750, pursuant to 9-A M.R.S. ? 6-108(1), for the purpose of refunding to K. E. H. the money she paid to Granite Law, which was collected by Granite Law at a time when it was not registered under the Maine Debt Management Services Act; and it is further
ORDERED that Granite Law shall, within 14 days of the date of this Order, pay to the ?Treasurer, State of Maine? $1,500 in civil penalties for having contracted with K. E. H. while not being registered under the Maine Debt Management Services Act to do so, pursuant to 10 M.R.S. ? 8003(5)(A-1)(3); and it is further
ORDERED that Granite Law shall, within 14 days of the date of this Order, pay to the ?Maine Bureau of Consumer Credit Protection? $2,000 towards the reasonable expenses, necessarily incurred, of its investigation and prosecution of this matter, pursuant to 9-A M.R.S. ? 6-106(6) and 32 M.R.S. ? 6178(3).
BY ORDER OF THE SUPERINTENDENT OF THE BUREAU OF CONSUMER CREDIT PROTECTION
| Date: December 06, 2013 | /s/William N. Lund |
| William N. Lund | |
| Superintendent | |
| Bureau of Consumer Credit Protection |
NOTICE OF APPEAL RIGHTS
Any party to this proceeding aggrieved by this Order may, within 30 days of the receipt of this Order, file a request for an adjudicatory hearing pursuant to 5 M.R.S. ?? 9051(2), 9052(1)(A), at which the aggrieved party shall have the opportunity to prepare and submit evidence and argument. If no request for a hearing is timely made, the terms of this Order shall become final and binding at the end of the 30-day period. Any party to this proceeding aggrieved by this Order may thereafter seek judicial review of the Order pursuant to 5 M.R.S. ?? 11001-11008 by filing a petition for review within 30 days after receipt of notice. Any other person aggrieved shall have 40 days from the date the Order was rendered to petition for review.
| Date: December 06, 2013 | /s/William N. Lund |
| William N. Lund | |
| Superintendent | |
| Bureau of Consumer Credit Protection |