A Towson law firm says it is being investigated by the attorney general’s Consumer Protection Division for services it stopped providing several years ago and, in some instances, never offered at all.
The Law Office of Daniel M. Radebaugh LLC has filed suit in Baltimore City Circuit Court, seeking to stop the division’s investigation into its loan modification activities and credit services work.
The firm, which focuses on bankruptcy law, alleges that it stopped performing the loan modification negotiations in question back in 2011 and has never performed any credit services work.
Michael E. Rowan, a lawyer representing the Radebaugh firm, said the Consumer Protection Division is also attempting to stretch the meaning of the Maryland Credit Services Business Act beyond the legislation’s intent, to include loan modifications.
Under the law, a “credit service business” is defined as a person or company that improves a consumer’s credit record or obtains an extension of credit. A Baltimore judge in another case has rejected the argument the Consumer Protection Division is trying to make, said Rowan, a shareholder with Shumaker Williams P.C. in Towson.
“They’re taking a much broader view of the Credit Services Business Act than is warranted under the law,” he said.
Alan Brody, a spokesman for the Consumer Protection Division, said Friday the office had not yet been served with the lawsuit, which was filed in late July.
The Radebaugh firm was served in November with an administrative subpoena from the attorney general’s office seeking “voluminous and extensive records,” the lawsuit states. The law firm objected on attorney-client privilege grounds, but the attorney general’s office sought and received a court order for the documents, which the law firm will hand over by the Aug. 12 deadline, according to the lawsuit.
“It’s taken my time and some of my resources to handle it,” Radebaugh said Friday of the investigation.
Both the Attorney Grievance Commission and state Office of the Commissioner of Financial Regulation have previously investigated Radebaugh for his work on loan modifications.
Radebaugh received a reprimand from Bar Counsel and agreed to stop representing clients in loan modification negotiations. The four clients who filed complaints received refunds of their attorneys’ fees, according to the lawsuit. (The commission reprimand is undated, but a report on the Attorney Grievance Commission’s website shows it occurred in fiscal 2013.)
Radebaugh has been in practice since 2003 and the reprimand is the only disciplinary action against him, according to the lawsuit.
The financial regulation office did not take any action against Radebaugh, but he provided more than $43,000 in refunds to 38 loan modification clients, according to the lawsuit.
The Consumer Protection Division is also investigating the firm for violations related to the state Mortgage Assistance Relief Services Act and Consumer Protection Act, according to the lawsuit.
The firm counters the mortgage assistance act went into effect in 2013, two years after it stopped handling loan modifications, and that lawyers are specifically exempted under the consumer protection act.
The lawsuit also seeks costs for the legal proceedings.
The case is Law Office of Daniel M. Radebaugh LLC v. Office of the Attorney General, Consumer Protection Division, #24C14004422, Baltimore City Circuit Court.