MO14643/MPB OAH Docket No.

16-1005-21890-2
STATE OF MINNESOTA
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF COMMERCE
In the Matter of Jason McCallum; Justin NOTICE OF AND ORDER FOR
McCallum; Chad Buchanan; and Save My HEARING, ORDER FOR PREHEAR1NG
Home USA Co., Inc. CONFERENCE, ORDER TO SHOW
CAUSE, AND STATEMENT OF
CHARGES
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
NOTICE OF HEARING
RESPONDENTS JASON MCCALLUM; JUSTIN MCCALLUM; CHAD
BUCHANAN; AND SAVE MY HOME USA CO., INC. ARE HEREBY NOTIFIED that the
Department of Commerce has initiated this action to determine whether Respondents have
committed the violations alleged below, subjecting the Respondents to disciplinary action.
ORDER FOR PREHEARING CONFERENCE
IT IS HEREBY ORDERED that a prehearing conference will be held on Friday, May 5,
2011 at 1:30 p.m. at the Office of Administrative Hearings, 600 North Robert Street, St. Paul,
Minnesota. The Chief Administrative Law Judge has assigned this matter to the Honorable
Manuel J. Cervantes, Administrative Law Judge. Judge Cervantes' telephone number is (651)
361-7945. AU mail sent to Judge Cervantes should be directed to P.O. Box 64620, St Paul,
MN 55164-0620.
ORDER TO SHOW CAUSE
IT IS ORDERED that Respondents must show cause why they should not be subject to
a civil penalty, as provided for in Minn. Stat. 45.027, subd. 6 (2010) and why they should not
be barred from residential mortgage origination and residential servicing pursuant to
Minn. Stat. 58.12, subd. l(a)(l) (2010).
ORDER FOR HEARING
IT IS FURTHER ORDERED that a hearing will occur at the Office of Administrative
Hearings, 600 North Robert Street in St. Paul, Minnesota, at a date and time to be determined at
the prehearing conference.
The hearing will be conducted under the contested case procedures set out in Chapters 14
and 45 of Minnesota Statutes (2010) and the Rules of the Office of Administrative Hearings,
Minnesota Rules Chapter 1400 (2009). A copy of these materials may be purchased from the
Minnesota Book Store, phone (651) 297-3000, or are available at www.revisor.leg.stafe.mn.us.
Copies of the rules are also available at www.oah.state.mn.us.
The attorney handling this case for the Department is Assistant Attorney General
Michael J. Tostengard, 1200 Bremer Tower, 445 Minnesota Street, St. Paul, Minnesota 55101-
2130, phone: (651)757-1314. Mr. Tostengard may be contacted to discuss discovery or
informal disposition of this matter.
STATEMENT OF CHARGES
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
$289,020 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.
Fee Paid to Received Loan
SMH Modification
$2,995
$2,995
$2,100
$2,100
52,300
$3,990
. S3 ,095
N
N
N
N
N
N
N
Refund
Requested
Y
Y
Y
Y
Y
Y
Y
Refund
Received
N
N
N
N
N
N
N
Customer
C.C,
J.C.
B.D.
T.D.
P.O.
J.D.
J.F.
K.F.
S. & M. J.
M.G.
A.G.
M.G.
T.H.
D.H.
L.G.
J.S.
Fee Paid to Received Loan
SMH Modification
$2,395
$2,000
52,200
$2,395
$2,000
$1,000
$1,895
$3,990
$2,995
$2,995
$1,500
$2,500
$2,500
$2,000
$2,095
$2,995
N
N
Y
N
N
N
N
N
N
N
N
N
N
N
N
N
Refund
Requested
Y
N.
N/A
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Y
Refund
Received
N
N
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 without notice.
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 III
By advertising a money back guarantee yet routinely failing to provide refunds on
services not rendered despite written and oral requests, Respondents repeatedly demonstrated
untnistworthiness 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 folly 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 administrative actions in Maryland and Michigan, the Respondents
were subject to disciplinary action in other states in violation of Minn. Stat. 58.12,
subd. l(b)(2)(vii){2010).
ADDITIONAL NOTICE
1. Respondents' failure to appear at the prehearing conference or hearing may result
in a finding that Respondents are in default, that the Department's allegations contained in the
Statement of Charges may be accepted as true, and that its proposed disciplinary action may be
upheld.
2. If any party has good cause for requesting a delay of the prehearing conference,
the request must be made in writing to the Administrative Law Judge at least five days before the
prehearing conference. A copy of the request must be served on the other party.
3. Any party intending to appear at the prehearing conference must file a Notice of
Appearance form and return it to the Administrative Law Judge within 20 days of the date of
service of the Statement of Charges. A copy must be served on the Department's attorney. A
Notice of Appearance form is attached.
4. At the hearing, all parties have the right to be represented by legal counsel, by
themselves, or by a person of their choice if not otherwise prohibited as the unauthorized practice
of law. The parties are entitled to the issuance of subpoenas to compel witnesses to attend the
hearing. The parties will have the opportunity to be heard orally, to present evidence and
cross-examine witnesses, and to submit evidence and argument. Ordinarily, the hearing is tape-
recorded. The parties may request that a court reporter record the testimony at their expense.
5. Persons attending the hearing should bring all evidence bearing on the case,
including any records or other documents. Be advised that if data that is not public is admitted
into the record, it may become public data unless an objection is made and relief is requested
under Minn. Stat. 14.60, subd. 2 (2010).
6. Requests for subpoenas for the attendance of witnesses or the production of
documents at the hearing shall be made in writing to the Administrative Law Judge pursuant to
Minn. R. 400.7000 (2009). A copy of the subpoena request shall be served on the other parties.
A subpoena request form is available at www.oah.state.mn.us or by contacting the Office of
Administrative Hearings at (651) 361-7900.
7. This case may be appropriate for mediation. The parties are encouraged to
consider requesting the Chief Administrative Law Judge to assign a mediator so that mediation
can be scheduled promptly.
8. The Office of Administrative Hearings conducts contested case proceedings in
accordance with the Minnesota Rules of Professional Conduct and the Professionalism
Aspirations adopted by the Minnesota Supreme Court. A publication entitled A Guide to
Participating in Contested Case Proceedings at the Office of Administrative Hearings is
available at www.oah.state.mn.us or by contacting the Office of Administrative Hearings at (651)
361-7900.
9. Any party who needs an accommodation for a disability in order to participate in
this hearing process may request one. Examples of reasonable accommodations include
wheelchair accessibility, an interpreter, or Braille or large-print materials. If any party requires
an interpreter, including a foreign language interpreter, the administrative law judge must be
promptly notified. To arrange for an accommodation or an interpreter, contact the Office of
Administrative Hearings, Post Office Box 64620, St. Paul, Minnesota 55164-0620, or may call
(651) 361-7900 (voice) or (651) 361-7878 (TTY).
10. Pursuant to Minn. Stat. 45.027, subd. 6 (2010), Respondents may be subject to a
civil penalty not to exceed $10,000 per violation upon a final determination that Respondents
violated any law, rule or order.
Dated:
1IKEROTHMAN
Commissioner
Minnesota Department of Commerce
85 Seventh Place East, Suite 500
St. Paul, MN 55101
Telephone: (651)296-4026
MO14643/MPB OAH Docket No. 16-1005-23890-2
STATE OF MINNESOTA
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF COMMERCE
In the Matter of Jason McCallum; Justin NOTICE OF APPEARANCE
McCallum; Chad Buchanan; and Save My
Home USA Co., Inc.
Date: Friday, May 5, 2011 Time: 1:30 p.m.
TO: Honorable Manuel J. Cervantes, Administrative Law Judge, Office of Administrative
Hearings, Post Office Box 64620, St. Paul, Minnesota 55164-0620
PLEASE TAKE NOTICE that the party named below will appear at the prehearing conference
in this matter:
Minnesota Department of Commerce
85 East 7th Place, Suite 600
St. Paul, MN 55101
(651)296-4026
PLEASE TAKE FURTHER NOTICE that the attorney named below will appear on behalf of
the Department of Commerce:
Michael J. Tostengard
Assistant Attorney General
Attorney Reg. No. 204973
445 Minnesota Street, Suite 1200
St. Paul, MN 55101-2130
(651)757-1314 -
Dated: 1?/'
MICHAEL J. TOSTENGARD
MO14643/MPB OAH Docket No. 16-1005-21890-2
STATE OF MINNESOTA
OFFICE OF ADMINISTRATIVE HEARINGS
FOR THE DEPARTMENT OF COMMERCE
In the Matter of Jason McCallum; Justin NOTICE OF APPEARANCE
McCallvun; Chad Buchanan; and Save My
Home USA Co., Inc.
Date: Friday, May 5, 2011 Time: 1:30 p.m.
TO: Honorable Manuel J. Cervantes, Administrative Law Judge, Office of Administrative
Hearings, Post Office Box 64620, St. Paul, Minnesota 55164-0620
PLEASE TAKE NOTICE that the party named below will appear at the prehearing conference
in this matter:
Name, Address, and Phone Number of Party:
Party's Attorney, Office Address and Phone Number:
Dated:
Signature of Party/ Attorney
NOTICE: This Notice must be served upon the attorney for the agency and any other known party. After an
attorney has filed a notice of appearance, withdrawal is effective only if a notice of withdrawal is promptly
served on all parties and filed with the judge. The notice of withdrawal must include the address and phone
number of the party. Withdrawal of counsel does not create any right to a continuance. Minn. R. 1400.5700.
AG:7720!3-vl
10
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 Notice of and Order for Hearing, Order for Prehearing Conference,
Order to Show Cause, and Statement of Charges, 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, Ml 48083
Subscribed and sworn to before me this
c.
day of //Ul'V^^- .2011.
JILL R KLAUSING
NOTARY PUBLIC MINNESOTA
MY COMMISSION
EXPIRES JAN. 31. 2015
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 48071