Attorney general calls for action to prevent foreclosure scams

Minnesota Attorney General Lori Swanson sent a letter to the Federal Trade Commission on Wednesday calling for action to protect struggling homeowners from foreclosure-related scams.

Attorney General Lori Swanson recently sued about a dozen companies for demanding upfront fees in exchange for foreclosure help. Minnesota law prohibits so-called foreclosure consultants from demanding money in advance for a loan modification.

Loan modifications and other foreclosure prevention assistance are readily available for free.

Swanson said a uniform, national law would prevent fraudulent companies from operating across state lines to take advantage of unsuspecting homeowners.

"There are many people who never find their way to our office they just simply pay the money and are very desperate and vulnerable and never complain to any governmental office," Swanson said. "So it's really hard for our office or any other to get a handle on how many people are out there."

A number of other states' attorneys general have signed on to the letter.