The defendant, Gabriel Stewart was the last of six defendants to resolve charges brought by the FTC in July 2014. The FTC alleged that the defendants were involved in a mortgage relief scam that “preyed upon distressed homeowners,” including elderly consumers. Stewart allegedly participated in the scheme operating under the fictitious names “2Apply” and “UW Solutions.” According to the FTC’s complaint, Stewart and the other defendants engaged in the following practices:
- Promised consumers that they will lower the consumer’s mortgage interest rates or help them avoid foreclosure when they typically did not achieve such results;
- Pretended that they were affiliated with, or endorsed by a government agency; and
- Illegally charged up-front fees of up to $695.
The FTC brought the action in 2014 as part of a joint federal and state enforcement sweep called “Operation Mis-Modification.” In September, 2016, the US District Court for the Central District of California granted summary judgment against one individual defendant and entered default judgments against four other defendants. The court found the defendants jointly and severally liable, imposed a ban, and entered judgment for over $1.7 million.
According to the FTC, litigation against Stewart, the final defendant continued until the stipulated order was entered into on February 21, 2017. Under the terms of the settlement, Stewart is permanently banned from the mortgage and debt relief business. The order also prohibits Stewart from making misrepresentations relating to financial and other products and services. In addition, the court entered a judgment against Stewart in the amount of $1,784,864 which he is jointly and severally liable for along with the other defendants. At this time, however, Stewart is only required to pay $105,487 to the FTC. The $1.7 million judgment was suspended based on a review of the Stewart’s financial representations, but will become due immediately if Stewart is found to have misrepresented his financial condition.