By Charisma L. Miller
Brooklyn Daily Eagle
An attorney with a debt relief and settlement company serving financially disadvantaged individuals has been charged with federal mail and wire fraud.
Attorney Michael Levitis, with an office on East 12th Street in Brooklyn, is the principal of Mission, a for-profit company with offices on Coney Island Avenue. Mission marketed and sold debt relief services to financially strapped persons via phone calls, mailings, and other solicitations. The federal government asserts that Mission and Levitis “committed deceptive and unfair practices causing substantial financial injury to consumers.”
The defendants allegedly violated the Telemarketing Sales Rule by requesting or receiving fees from debt-relief clients before actually negotiating or otherwise reducing the clients’ debts. In October 2010, the federal government instituted the rule that prohibits companies that sell debt relief services over the telephone from charging fees before settling or reducing a customer’s unsecured debt.
“The rule change…is a major victory for consumers struggling to control and manage their debt without inadvertently digging themselves in deeper,” Federal Trade Commission Chairman Jon Leibowitz said of the rule. “[D]ebt relief telemarketers are on notice – if you charge consumers before actually helping them, you will find the FTC and state enforcers knocking at your door to enforce the Rule.”
Instead of Mission’s upfront fees going toward reducing clients’ debt, “a large percentage … went to Mission, which provided scant meaningful assistance to [clients] and often left consumers in a worse financial position,” the government alleges.
Mission and Levitis’ actions also violated the Consumer Financial Protection act, the government asserts. It is alleged that the defendants represented to debt-relief clients that their services were affiliated with the federal government. The representations were “material, false, and likely to mislead … consumers,” the government stated in court papers.
In addition to restitution and disgorging the defendant’s “ill-gotten profits,” the government has moved to seize Rasputin, a Brooklyn nightclub owned by Levitis.
Levitis is currently suspended from the practice of law for lying to the FBI in a political corruption case.