White-Collar Crime

3 Attorneys Face Felony Charges Over What Calif. AG Calls a Law Firm Home-Loan Modification Scam

Three partners of a law firm based near Sacramento, Calif., were arrested today and and face felony charges on accusations that they were operating what the state attorney general describes as a law firm home-loan-modification scam.

Gregory Flahive, 39, Cynthia Flahive, 41, and Mike Johnson, 42, who serves as managing partner of Flahive Law Corporation are accused of taking money from clients for loan-modification services that were never provided, CBS Sacramento reports.

State law prohibits clients from being charged up front for loan-modification services by foreclosure consultants.

The three, who face charges of grand theft by false pretense, conspiracy and false advertising, are being held in the Sacramento County Jail in lieu of $50,000 bail.

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