MO14643/MPB

STATE OF MINNESOTA
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF COMMERCE
In the Matter of Jason McCallum; Justin CEASE AND DESIST ORDER AND
McCallum; Chad Buchanan; and Save My NOTICE OF RIGHT TO HEARING
Home USA Co., Inc.
TO: Mr. Jason McCallum and Mr. Chad Buchanan, Co-Owner
Mr. Justin McCallum, Co-Owners Save My Home USA Co., Inc.
Save My Home USA Co., Inc. 1401 West Girard Avenue
1401 West Girard Avenue Madison Heights, MI 48071
Madison Heights, MI 48071
Save My Home USA Co., Inc. Save My Home USA Co., Inc.
37040 Garfield 1441 East Maple Road, Suite 100
Clinton Township, MI 48036 Warren, MI 48083
Save My Home USA Co., Inc. Save My Home USA Co., Inc.
30800 Van Dyke Avenue, Suite 102 2663 Athena Drive
Warren, MI 48093 Troy, MI 48083
Mr. Andrew Capelli, Registered Agent
Save My Home USA Co., Inc.
1401 West Girard Avenue
Madison Heights, MI 48071
INTRODUCTION
No person may act or hold themselves out as a residential mortgage originator or
residential mortgage servicer in the State of Minnesota without a valid license issued by the
Minnesota Department of Commerce unless such person is exempt from said licensing
requirements. Minn. Stat. 58.02, subds. 18-23, and 58.04 (2010).
Pursuant to the above-referenced statutes, Commissioner Mike Rothman of the
Minnesota Department of Commerce has determined as follows:
ALLEGATIONS
1. Respondents are not licensed by the Department in any capacity. Respondents
Jason McCallum, Justin McCallum and Chad Buchanan are all owners and officers of
Respondent Save My Home USA Co., Inc. Respondents have been known to operate under the
following: Save My Home USA; Savemyhomeusa; and 2MM, LLC.
2. The Department conducted an investigation of Respondents and learned that
Respondents contacted approximately 118 Minnesota residents who paid advanced fees totaling
5289,020 for loan modification services.
3. On August 25, 2010, the Department sent an administrative subpoena to
Respondents at the four addresses noted above. No response was received. The telephone lines
used by Respondents have also been disconnected. It does not appear that the company is doing
any more business in Minnesota at this time.
4. As part of its loan modification program, the Respondents offered and advertised
a money back guarantee to its customers if the loan was not successfully modified. Upon
information and belief, of the customers who did not receive a loan modification, no one
received a refund despite the fact that many requested one. What follows is a table of 23
customers interviewed by the Department concerned the Respondents' business activities.
Customer
J.B.
L.B.
C.B.
M. & L.B.
J.B.
A. & R.B.
B.B.
C.C
J.C.
Fee Paid
SMH
$2,995
$2,995
$2,100
$2,100
$2,300
$3,990
$3,095
$2,395
$2,000
to Received Loan
Modification
N
N
N
N
N
N
N
N
N
Refund
Requested
Y
Y
Y
Y
Y
Y
Y
Y
N
Refund
Received
N
N
N
N
N
N
N
N
N
Customer
B.D.
T.D.
P.D,
J.D.
J.F.
K.F.
S.&MJ.
M.G.
A.G.
M.G.
T.H.
D.H.
L.G.
J.S.
Fee Paid to Received Loan
SMH Modification
$2,200
$2,395
52,000
$1,000
51,895
$3,990
$2,995
$2,995
$1,500
$2,500
$2,500
$2,000
$2,095
$2,995
Y
N
N
N
N
N
N
N
N
N
N
N
N
N
Refund
Requested
N/A
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Refund
Received
N/A
N
N
N
N
N
N
N
N
N
N
N
N
N
Only one of the 23 customers listed above received a loan modification.
6. Numerous customers who paid an advance fee stated that prior to the completion
of their loan modification services, Respondents' phone lines were disconnected.
7. The Respondents have been the subject of administrative actions in Michigan and
Maryland for unlicensed loan modification activities.
8. This Order is in the public interest.
VIOLATIONS
COUNT I
By engaging in unlicensed loan modification activities in at least 118 instances, the
Respondents repeatedly violated Minn. Stat. 58.04, subds. 1 and 3 (2010).
COUNT II
By habitually failing to complete the tasks it was paid in advance to complete, the
Respondents repeatedly demonstrated untrustworthiness and incompetence in violation of Minn.
Stat. 58.12, subd. l(b)(2)(v) (2010).
COUNT HI
By advertising a money back guarantee yet routinely failing to provide refunds on
services not rendered despite written and oral requests, Respondents repeatedly demonstrated
untrustworthiness and incompetence and engaged in fraudulent, deceptive, coercive and
dishonest practices in violation of Minn. Stat 58.12, subd. l(b)(2)(iv)(v) (2010).
COUNT IV
By failing to disclose to each customer the percentage of customers who actually
received a loan modification during the 12-month period ending 10 business days before the date
of the contracts in question were signed or while charging advance fees, the Respondents
violated Minn. Stat 58-16, subd. 2(a)(6) (2010).
COUNTY
By failing to be responsive to questions, concerns, and inquiries made by its customers
who had paid advance fees and disconnecting its phone lines without notice, Respondents
demonstrated untrustworthiness and incompetence in violation of Minn. Stat. 58.12,
subd. l(b)(2)(v) (2010).
COUNT VI
By charging and collecting a fee prior to fully performing each and every service the
Respondents were contracted to perform, the Respondents repeatedly violated
Minn. Stat. 325N.04(1) (2010).
COUNT VII
By being subject to a Cease and Desist Order in Maryland, the Respondents were subject
to disciplinary action in another state in violation of Minn. Stat. 58.12, subd. l(b)(2)(vii)
(2010).
ORDER
NOW, THEREFORE, IT IS HEREBY ORDERED, pursuant to Minn. Stat. 45.027,
subd. 5, and 58.04, subds. 1 and 3 (2010), that Respondents Jason McCallum; Justin McCallum;
Chad Buchanan; and Save My Home USA Co., Inc., shall cease and desist from acting or
holding themselves out as residential mortgage originators or residential mortgage servicers in
the State of Minnesota until Respondents comply with Minn. Stat. ch. 58 (2010), and this Order
is otherwise vacated or modified by the Commissioner.
NOTICE OF RIGHT TO HEARING
IT IS FURTHER ORDERED, pursuant to Minn. Stat. 45.027, subd, 5a (2010), that
Respondents may request a hearing in this matter. Such request shall be made in writing and
served on the Commissioner, whereupon the Commissioner shall set a date for hearing within ten
(10) days after receipt of the request unless Respondents and the Department agree to waive the
10-day time period. If no hearing is requested by Respondents within thirty (30) days of service
of this Order and none is ordered by the Commissioner, this Order will become permanent and
will remain in effect until modified or vacated by the Commissioner.
IT IS FURTHER ORDERED, that if a hearing is requested, this Order will remain in
effect until modified or vacated or made permanent by further order of the Commissioner under
Minn. Stat. 45.027, subd. 5a (2010). The administrative proceeding provided by Minn. Stat.
45.027, subd. 5a (2010), and subsequent appellate judicial review of that administrative
proceeding, constitutes the exclusive remedy for determining whether the Commissioner
properly issued this Order and whether this Order should be made permanent.
IT IS FURTHER ORDERED, that, notwithstanding Minn. Stat. 45.027, subds. 5 or
5a (2010), if Respondents request a hearing under Minn. Stat. 45.027, subd. 5a (2010),
Respondents may, within 15 days after service of this Order, bring an action in Ramsey County
District Court for an injunction to suspend enforcement of this Order pending a final decision by
the Commissioner under Minn. Stat. 45.027, subd. 5a (2010) to vacate or make permanent this
Order. The court shall determine whether to issue such an injunction based on traditional
principles of temporary relief.
IT IS FURTHER ORDERED, that in the event a hearing is requested in this matter, it
will be held before an Administrative Law Judge to be appointed by the Chief Administrative
Law Judge for the State of Minnesota, Office of Administrative Hearings, Harold E. Stassen
Office Building, 600 North Robert Street, St. Paul, Minnesota 55101, Telephone: (651) 361-
7900. All parties have the right to represent themselves or be represented throughout the
proceedings herein by legal counsel or a person of their choice if not otherwise prohibited as the
unauthorized practice of law. The hearing will be conducted under the contested case procedures
in Minn. Stat. 14.57-14.69 (2010), and the Rules of the Office of Administrative Hearings,
Minn. R. 1400.5100-1400.8401 (2009), Failure to attend a hearing in this matter may result in
the allegations of this Order being taken as true. Any questions concerning the issues which
were raised in this Order, or if you wish to discuss an informal disposition of this proceeding,
may be directed to Assistant Attorney General Michael J. Tostengard at (651) 757-1314 Mr.
Tostengard's address is the Minnesota Attorney General's Office, 1200Bremer Tower, 445
Minnesota Street, St. Paul, Minnesota 55101-2130.
Dated: 3-^-1'
AC: 7833%-vl
MlKEROTHMATT'
Commissioner
Minnesota Department of Commerce
85 Seventh Place East, Suite 500
St. Paul, MN 55101
Telephone: (651)296-4026
AFFIDAVIT OF SERVICE BY U.S. MAIL
Re: In the Matter of Jason McCallum; Justin McCallum; Chad Buchanan; and Save My Home USA
Co., Inc.. OAHDocket No. 16-1005-21890-2
STATE OF MINNESOTA
COUNTY OF RAMSEY
)
)ss.
)
JEAN-ANNE GATES, being first duly sworn, deposes and says:
That at the City of St. Paul, County of Ramsey and State of Minnesota, on this 9th day of March,
2011, she caused to be served the Cease and Desist Order and Notice of Right to Hearing, by depositing
the same in the United States mail at said city and state, true and correct copy thereof, properly enveloped
with prepaid first class postage, and addressed to:
Mr. Jason McCallum, Co-Owners
Save My Home USA Co., Inc.
1401 West Girard Avenue
Madison Heights, MI 48071
Mr. Chad Buchanan, Co-Owner
Save My Home USA Co., Inc.
1401 West Girard Avenue
Madison Heights, MI 48071
Save My Home USA Co., Inc.
1441 East Maple Road, Suite 100
Warren, MI 48083
Save My Home USA Co., Inc.
2663 Athena Drive
Troy, MI 48083
Subscribed and sworn to before me this
Mr. Justin McCallum, Co-Owners
Save My Home USA Co., Inc.
1401 West Girard Avenue
Madison Heights, MI 48071
Save My Home USA Co., Inc.
37040 Garfield
Clinton Township, MI 48036
Save My Home USA Co., Inc.
30800 Van Dyke Avenue, Suite 102
Warren, MI 48093
Mr. Andrew Capelli, Registered Agent
Save My Home USA Co., Inc.
1401 West Girard Avenue
Madison Heights, MI 4807.1
JILL R. KLAUSI
NOTARY PUBLIC - MINNESOTA
MY COMMISSION
EXPIRES JAN. 31.2015