Illinois sues property maintenance firm over foreclosure actions
The state of Illinois is suing the nation's largest firm that maintains foreclosed homes for lenders, alleging that it illegally broke into the occupied homes of people behind on their mortgage or in foreclosure, locked them out and removed their belongings.
The lawsuit against Safeguard Properties, filed Monday by Illinois Attorney General Lisa Madigan in Cook County Circuit Court, also charges that representatives of Safeguard, which includes subcontracted firms, wrongly told homeowners and renters that they could not live in their homes during the foreclosure process.
Madigan's office said more than 200 Illinois residents have complained that Safeguard removed their personal property from their homes. In one case, according to the suit, the belongings wrongly removed by a Safeguard contractor included a tenant's asthma pumps.
"We're reviewing it now," said Diane Fusco, a spokeswoman for the Valley View, Ohio-based company. "We intend to vigorously defend against the lawsuit."
Under Illinois law, homeowners who have missed mortgage payments and are in foreclosure can remain in their homes until the court-supervised foreclosure process is completed and a judge has entered an order of possession against them. Also, tenants living in rental buildings in foreclosure can stay until the lease expires, even if the foreclosure process has been completed and the building has been repossessed.
"Despite these legal protections, Safeguard has ignored and severely curtailed the rights of occupants of at-risk properties, properties in foreclosure and (bank-owned) properties by illegally breaking into homes, removing occupants' personal property, locking out occupants, turning off utilities for legally occupied property, refusing to allow re-entry into these properties, and making coercive and deceptive representations to legal occupants," the lawsuit charges.
According to the suit, Safeguard does not adequately train the firms it subcontracts with to determine whether a property is occupied or vacant. "Safeguard or its subcontractors often deem property to be vacant despite clear signs that the property is not vacant, such as a barking dog inside the home, a car in the driveway, garbage cans placed outside for pickup, a neighbor's statement that the property is occupied or even the actual presence of a legal occupant in the home when the subcontractors arrive at the property," the suit states.
Among the consumers named in the suit is Mark Fencke, who fell behind in the mortgage payments on his home in Cook County in the summer of 2008, when he lost his full-time job. In early 2009, Fencke, a reserve member of the U.S. Armed Forces, was trying to negotiate a short sale of his home. While at military training, according to the complaint, Safeguard broke into his home, shut off his utilities, changed the lock on his home and did damage in the home. Safeguard did not reimburse him for any of the damage or for the days he was without utility service.