A Lawrence-based financial consulting firm was ordered to pay $240,000 in penalties and restitution by a Suffolk County Superior Court judge for continuing predatory loan practices in violation of an injunction, the attorney general announced yesterday.
Robert Burton, owner of Pinnacle Financial Consulting, was held in contempt of court last Thursday for ignoring orders prohibiting him from concealing assets, destroying records and advertising, soliciting or providing loan modifications and legal advice, according to a statement by Attorney General Martha Coakley.
“These defendants, despite a court order, continued to solicit consumers with their deceptive foreclosure relief practices and illegal upfront fees,” Coakley said. “Consumers need to be aware of these scams that attempt to take advantage of struggling homeowners.”
Attempts to reach Burton and an attorney representing him were unsuccessful. His business line is no longer in service. Attorney Darrell Mook, of the Boston firm Donovan Hatem, said he no longer represented Burton and was unaware of the order.
Of that $240,000 judgment, penalties make up about $170,000, which will be paid to the state. Restitution to five clients of his bankruptcy, loan modification and investment consulting businesses totaled $30,400. Another $39,800 is to be paid in fees and costs.
Coakley filed suit against Pinnacle in March, accusing Burton of using the foreclosure crisis to prey upon homeowners, targeting minorities and non-English speakers and providing legal advice without a license.
According to the suit, Burton would identify and contact homeowners close to losing their homes, offering to get modifications to their loans and demanding advance payments for the service contrary to state regulations, according to Coakley’s suit. After repeatedly failing to negotiate any modification to the loans, he pressured dozens of homeowners to pay him thousands of dollars to file for bankruptcy to delay a foreclosure sale.
The allegations also included misrepresenting to consumers the services the company could provide, exaggerating the benefits of its services, practicing law without a license, failing to take any action to provide the promised services after receiving payment and refusing to provide refunds upon request.
Burton is not licensed to practice law in Massachusetts.
On the financial advisory side of his business, Burton solicited money from people to invest, but did not make any investments and failed to return any of the money.
The suit is still ongoing, according to the attorney general’s office.
Ariel Castillo, an Army lieutenant who served two tours of duty in Iraq, said he turned over his savings to Burton to invest, including a hefty re-enlistment bonus. Burton was, a friend of his sister’s and wife’s who attended his wedding. But when he began to suspect Burton was not managing his investment competently and tried to withdraw his money, Burton would not return it.
“I think he got off easy if you ask me,” said Castillo, a Lawrence native who now works in the Veterans Administration in New York. “It’s not just the amount he took from people who didn’t have much, but it’s being a parasite to the city and the commonwealth. He destroyed people who confided in him.”
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