minnesota department of commerce findings of fact & order in save my home usa case

8/12/2019 Minnesota Department of Commerce Findings of Fact & Order in Save My Home USA case

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M014643/MPB

STATE OF MINNESOTADEPARTMENT OF COMMERCE

COMMISSIONER OF COMMERCE

In the Matter of Jason McCallum;Justin McCallum; Chad Buchanan; andSave My Home USA Co., Inc.

FINDINGS OF FACT,CONCLUSIONS OF LAW,

AND ORDEROAH Docket No. 16-1005-21890-2

The matter came on for a hearing before Administrative Law Judge Manuel J. Cervantes

on May 5,2011 at the Office o f Administrative Hearings in St. Paul. Assistant Attorney General

Michael J. Tostengard appeared on behalf of the Department of Commerce. There was no

appearance by or on behalf of the Respondents, Jason McCallum; Justin McCallum; Chad

Buchanan; and Save My Home USA Co., Inc. The Administrative Law Judge's Findings of

Fact, Conclusions, and Recommendation were issued June 14,2011. In accordance w ith Minn./

Stat. 45.024 (2010), Commissioner of Commerce Mike Rothman delegated the authority to

issue a final order in this matter to Deputy Commissioner ofCommeree Kevin M . Murphy. By

letter dated July 25, 2011, Deputy Commissioner Murphy informed the parties of their right o

file exceptions and argument with the Commissioner regarding the Administrative Law Judge's

Findings of Fact, Conclusions and Recommendation. The Department's argument was made by

letter dated August 15,2011. No exceptions or arguments were filed by the Respondent and the

record closed on August 15,2011.

Based upon all the facts, records and proceedings herein, the Commissioner makes the

following:


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FINDINGS OF FACT

1. The Commissioner adopts in their entirety and incorporates as his own all of the

Findings of Fact contained in the Administrative Law Judge's Report.

2. Any Finding of Fact herein, which should more properly be deemed a Conclusion of

Law, is hereby adopted as suck

Based upon the foregoing Findings of Fact, the Commissioner makes the following:

CONCLUSIONS OF LAW

1. The Commissioner adopts and incorporates herein by reference all of the

Conclusions contained in the Administrative Law Judge's Report.

2. Any Conclusion of Law herein, which should more properly he deemed a Finding of

Fact, is hereby adopted as such.

3. This Order is in the public interest.

ORDER

NOW, THEREFORE, IT IS HEREBY ORDERED that Respondents Jason

McCallum, Justin McCallum, Chad Buchanan and Save My Home USA Co., Inc. are hereby

BARRED from residential mortgage origination or servicing in Minnesota.

IT IS FURTHER ORDERED that Respondents jointly and severally shall pay to the

State of Minnesota a civil penalty of $289,000. Pursuant to Minn. Stat. 16D.17(1) (2010),

Respondents are notified that this shall become a final civil penalty order unless Respondents

request a hearing fiom the Department on the civil penalty within 30 days. Respondents are

further notified that when the civil penalty order becomes final, he Commissioner ofCommeree


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may file and enforce the civil penalty in the same manner as a district court judgment against

Respondents without further notice or additional proceedings. Minn. Stat. 16D.17(2) (2010).

Dated: L " . 1 1 MIKE ROTHMANCommis

By:KEyjfN M . MURPHYDeputy CommissionerFinancial Institutions Division

85 Seventh Place East, Suite 500St Paul, Minnesota 55101Telephone: (651)296-2715


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MEMORANDUM

This matter comes before the Commissioner foiiowing Respondents defanit at a

prehearing eonf noe. The Departtnent's Order for Prehearing Con ^

properly issued and served npon Respondents, providing fhem proper notice fhafadnnnisfrafive

acdon was being initiated against them, and that Respondents would he deemed in default and

the allegations set forth wouldbe deemedprovenifRespondentsfailedtoappearatthe

prehearing conference. Despite this notice, no one appeared on behalfofRespondenfs at the

prehearing conference. Asaresult, the Conunissioner is authorised to dispose ofthis contested

case proceedmg adversely to any party who defaults in acc ^

( 2 0 ^ Asaresult of Respondent's default the allegations in the Department's Order for

Hearing are takenas true and deemed proven.

Therecordin this caseestablishesthatRespondents are not licensed by the Department in

any capacity. Respondents Jason McCallum, Austin McCallum and Chad Buchanan are all

owners and officers of Respondent Save My Home USACo., Inc. Respondents have been

l owntooperateunderthefollowing:SaveMyHomeUSA Savemyhomeusa;and2MM,LLC.

The Departmentconductedan investigation ofRespondentsandleamedthatRespondents

contacted approximatelyll Minnesotaresidentsv opaidadvanced fees, total ing^

loanmodificationservices.

On August 25, 2010, the Department sent an adn nistrative subpoena to Respondents at

their last known address. No response was received. The telephone lines used hy Respondents

havebeen disconneeted. It does not appear that the company is doing any more business in

Minnesotaatthistime.


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As part ofi^loan modification progr^^

money hack guarantee to ^fronstomcrsifti^eioan was not success^ Upon

mfonnationandheii^ oftheenstomers who didnotreceiveaioanmodifieation noone

reeeivedarefimd despite the fact that many requested refimds. Oniy one of the 23 customers

receivedaioanmodificationB

Numerous customs who paid an advance fee stated that prior to the completion oftheir

ioanmodificationservices,Respondents'phoneiinesweredisconnectedwithoutnotice.

TheRespondentshaveheenthe suh^ectofadministrativeactionsin Michigan and

Maryland foruniicensed loan modificationactiyities.

As setforthintherecordestahlishedinALJ Cervantes'report,

the record in this ease establishes numerous and egregious violations of Chapter 58 of the

MinnesotaStatutes, including illegal advanced fees paidhy Minnesota residents totalling

$298,020. Basedonat least 118 instances of unlicensedloanmodificationactivity, the

Departn enthas requested thatacivil penalty of$500,000he imposed on eachRespondent and

that each Respondent he barred from mortgage activity in Minnesota. Respondents'violations

are indeed serious and warrant harringthem iom finther activity inMinnesota and an aggregate

civil penalty of $298,000, which is approximately equal to the illegal advance fees paidhy

Minnesotaresidentsandnotrefunded.

K^MM

minnesota department of commerce findings of fact & order in save my home usa case

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