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  • Schuette Charges Metro-Detroit Attorney with Thirty Felony Counts Including Racketeering in Fake Mortgage Assistance Scheme

    Michigan Attorney General Bill Schuette today announced that his Homeowner Protection Unit has filed thirty felony charges including Racketeering against attorney Steven Barry Ruza, 52, of Orchard Lake and his company, Home Legal Group, Inc., for stealing hundreds of thousands of dollars from Michigan victims that were facing mortgage foreclosures.  The charges were filed following an Attorney General investigation.

    “Scam artists who prey on Michigan families are deplorable, and especially so in this case where the families were already having trouble making ends meet,” said Schuette.  “We will continue to aggressively dismantle these predatory operations and prosecute the criminals behind these schemes.”



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Press Releases
Schuette Announces Arraignment of Former Michigan Priest in 1980s Sexual Abuse Cases
  

 

   May 28, 2015              

        

      LANSING – Attorney General Bill Schuette today announced the arraignment of former Jackson Lumen Christi High School priest, teacher, maintenance supervisor, and wrestling coach James Rapp, 75, on charges of multiple felonies for his alleged sexual assault of several Michigan boys in the 1980s.

     Rapp was arraigned on Thursday, May 28 at 8 a.m. before Judge Joseph S. Filip of the 12th District Court in Jackson, where a plea of not guilty was entered on the defendant's behalf to three counts of first degree criminal sexual conduct and 10 counts of second degree criminal sexual conduct.  Rapp was also assigned a $1 million cash bond. He is next due in court for a pre-exam conference on June 26, 2015 at 8 a.m. before Judge Joseph S. Filip of the 12th District Court in Jackson. Jackson-area attorney Alfred Brandt has been appointed to represent Rapp.

Case Background

     In spring of 2013, more than 30 years after the alleged crimes occurred, two of Rapp's victims reported the alleged sexual abuse to the Jackson County Sheriff's Department, who then launched an extensive investigation revealing several more victims.

     JLC was not Rapp's first church or school assignment.  Rapp was ordained in 1959 and held teaching assignments in Philadelphia (1959 – 1961), Salt Lake City (1968 – 1973), and in Lockport, New York (1979 – 1980).  Following Rapp's resignation at JLC, Rapp served as a priest and teacher in Naperville, Illinois (1987 – 1990) and Duncan, Oklahoma (1990 – 1998).

     On January 12, 2015, Schuette filed the following charges against James Francis Rapp in Jackson's 12th District Court:

  • Three counts of First Degree Criminal Sexual Conduct, a felony punishable by up to life in prison; and,
  • 10 counts of Second Degree Criminal Sexual Conduct, a felony punishable by up to 15 years in prison.

     If convicted of the first degree sexual assault counts, Rapp must also register as a sex offender for life in Michigan.

     Citizens who believe they may have information about Rapp's alleged sexual abuse are encouraged to contact the Attorney General's Criminal Division at 313-456-0180.

Cold Case Sexual Assault Project and Role in Investigation

     This case will be prosecuted by Attorney General Schuette's Cold Case Sexual Assault Project  (AGCCSA).  Created in 2012, AGCCSA is funded by a United States Department of Justice-Office of Violence Against Women grant to combat sexual assault and sexual violence.

     A criminal charge is merely an accusation and the defendants are presumed innocent until and unless proven guilty. 
Mug shot of Rapp5

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Schuette Announces $11 Million Multistate Settlement with Classmates, FTD
  

 

   May 27, 2015              

        

      LANSING – Michigan Attorney General Bill Schuette today announced that his Consumer Protection Team – along with attorneys general of 21 other states – negotiated an $11 million settlement with Classmates, Inc. (Classmates), Florists’ Transworld Delivery, Inc. and FTD.com Inc. (collectively FTD) to resolve allegations that the companies engaged in misleading advertising and billing practices.

     Classmates.com is a social networking website and FTD.com is a floral delivery service.

       “I am pleased that as a result of this settlement, we are better able to protect consumers from deceptive marketing and illegal data pass practices, said Schuette. “We will continue to aggressively pursue anyone seeking to skirt the rules at the expense of Michigan consumers and their hard-earned dollars.”

 Background on Classmates and FTD Misleading Marketing and Illegal Data Pass Practices

      The investigation alleges Classmates and FTD engaged in misleading, unfair, and deceptive practices in violation of state consumer protection laws. Specifically, the investigation focused on the companies’ relationships with third-parties who used negative option marketing practices to sell membership programs to consumers doing business online with Classmates and FTD.  Negative option marketing is a sales practice in which a seller treats a consumer’s failure to take an affirmative action, either to reject an offer or cancel an agreement, as assent to be charged for goods or services. 

      These third-party marketers offered programs such as discount buying clubs and travel rewards programs, often immediately after the consumer’s online transaction with Classmates or FTD.  Unbeknownst to the consumer, Classmates and FTD would share consumers’ personal information, including credit card account numbers (a practice known as “data pass”) so that the consumer could be billed for these offers if they did not cancel.  Congress banned data pass in Internet transactions in 2010 with the passage of the Restore Online Shoppers’ Confidence Act.

     Classmates and FTD agreed to make an $8 million payment to the states as a part of the settlement.  Additionally, Classmates is establishing a $3 million restitution fund to provide refunds to consumers who were enrolled into Classmates’ subscription service without authorization or who experienced difficulty when trying to cancel their Classmates subscriptions.

Protecting Consumers Going Forward

     Today’s agreement includes a number of terms to further protect future FTD and Classmates consumers going forward including:

  • A prohibition against misrepresenting the reason for requesting a consumer’s account information.
  • Classmates/FTD’s marketing partners cannot use FTD and Classmates’ names or logos in the title of a membership program, and any offer must be made after the consumers have concluded their transactions with Classmates or FTD, in order to ensure that consumers understand they are receiving a separate and distinct offer from a company other than FTD and Classmates.
  • Before consumers are transferred to a marketing partner to receive a trial offer, the consumers must receive clear and conspicuous disclosures informing them that they will be transferred to another site to receive a membership offer and the consumers must consent to the transfer.
  • Classmates/FTD and its marketing partners cannot state an offer is “free” or “risk free” if the offered program will convert to a paid subscription.
  • Classmates/FTD are generally prohibited from making misrepresentations and material omissions, including making any misrepresentations concerning the reason or purpose for which a consumer is receiving an offer for enrollment in a membership program.

Positive Results for Consumers from Classmates.com Investigation

      The investigation also included Classmates’ renewal and cancellation practices in connection with its own social network subscription services offered to consumers through its website, Classmates.com.   The allegations include that Classmates failed to adequately inform consumers that their subscriptions would automatically renew and made it difficult for consumers to cancel their subscriptions.  Under today’s settlement, Classmates has agreed to make significant changes to its business practices, including more clearly disclosing to consumers that their Classmates subscriptions will automatically renew and making it easier for consumers to cancel their subscriptions.

How to File a Complaint for a Refund from Classmates

      Consumers seeking a refund from Classmates, and who have not previously filed a complaint with the Department of Attorney General, may file an online complaint with Schuette’s Consumer Protection Team or by writing the Consumer Protection Division, P.O. Box 30213, Lansing, MI 48909 postmarked before August 24, 2015. Classmates’ restitution fund is designated to refund consumers who were enrolled into Classmates’  subscription service without their authorization or who experienced difficulty cancelling, during the period from January 1, 2008 to May 26, 2015.

      The States included in the settlement are Alabama, Alaska, Delaware, Florida, Idaho, Illinois, Kansas, Maine, Maryland, Michigan, Nebraska, New Jersey, New Mexico, North Dakota, Ohio, Oregon, Pennsylvania, South Dakota, Texas, Vermont, Washington, and Wisconsin. 

A.G. Schuette: Fighting for Michigan Consumers

      Since 2011, Schuette’s Consumer Protection Team has collected more than $30 million in consumer refunds, cancelled debts, and civil penalties – the largest recovery recorded for any Michigan attorney general over a four-year period.  Schuette’s office has also responded to more than 44,600 written consumer complaints through his consumer complaint mediation program since 2011.

      Schuette encourages victims of unfair, misleading, or deceptive business practices to contact his Department's Consumer Protection Team at 517-373-1140 or toll free at 877-765-8388.

      To file a consumer complaint, Michigan residents can submit an online complaint form through the Attorney General's website at http://www.michigan.gov/AG or by mail to:

Michigan Attorney General Bill Schuette
Consumer Protection Division
P.O. Box 30213
Lansing, MI 48909

 

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Schuette Charges Metro-Detroit Attorney with Thirty Felony Counts Including Racketeering in Fake Mortgage Assistance Scheme
  

 

   May 26, 2015              

     

     LANSING – Michigan Attorney General Bill Schuette today announced that his Homeowner Protection Unit has filed thirty felony charges including Racketeering against attorney Steven Barry Ruza, 52, of Orchard Lake and his company, Home Legal Group, Inc., for stealing hundreds of thousands of dollars from Michigan victims that were facing mortgage foreclosures.  The charges were filed following an Attorney General investigation.

     “Scam artists who prey on Michigan families are deplorable, and especially so in this case where the families were already having trouble making ends meet,” said Schuette.  “We will continue to aggressively dismantle these predatory operations and prosecute the criminals behind these schemes.”

     Ruza and Home Legal Group allegedly promised victims that they could obtain mortgage modifications and save their homes from foreclosure but then did nothing, or very little, to obtain mortgage modifications for the victims.  The victims never received a modification through Ruza and Home Legal Group and most lost their homes to foreclosure. 

     Schuette filed the following charges on May 22, 2015 against Ruza and Home Legal Group PLLC in Oakland County’s 48th District Court:

  • Twenty-six counts of obtaining money through false pretenses (making false statements to consumers), a felony punishable by up to five years in prison and/or a $10,000 fine;
  • Two counts of attempted false pretenses over $20,000 but less than $50,000, a felony punishable by five years’ imprisonment;
  • One count of attempted false pretenses of $1,000 or more but less than $20,000, punishable by up to five years in prison, and;
  • One count of Racketeering, a felony punishable by 20 years in prison and/or a $100,000 fine.  

     The Racketeering count includes an additional 114 victims for whom Schuette alleges were defrauded.

     Ruza and his company were arraigned before Magistrate Nelson Klein of the 48th District Court, West Bloomfield, on Friday, May 22.  Bond was set at $1 million cash/surety for Ruza and $500,000 cash/surety for Home Legal Group.  Ruza’s next court appearances include a conference on June 4, 2015 and the preliminary examination set for June 11, 2015.  Both appearance will be before Judge Marc Barron.

Foreclosure Rescue Scam Victim Restitution Fund

     In August 2013 Schuette announced the launch of a $7.5 million Foreclosure Rescue Scam Victim Restitution fund as a part of the Homeowner Protection Fund monies received by the State of Michigan to resolve the National Mortgage Settlement.  This program is intended to provide restitution payments for victims of foreclosure scams who would otherwise never see a penny of court-ordered restitution.  To date over $2.2 million has been paid to Michigan victims of mortgage related crimes.

     For more information on the mortgage settlement, including a consumer alert and a Frequently Asked Questions document available for download on the Attorney General’s website: www.michigan.gov/mortgagesettlement. 

Mortgage Settlement and Homeowner Protection Fund Background

     The historic $25 billion National Mortgage Settlement followed state and federal investigations, which alleged that five major mortgage servicers routinely signed foreclosure-related documents outside the presence of a notary public and without personal knowledge that the facts contained in the documents were correct.  This civil law enforcement action also alleged that the servicers committed widespread errors and abuses in their foreclosure processes. Broad reform of the mortgage servicing process resulted from the settlement, as well as financial relief for borrowers still in their homes through direct loan modification relief, including principal reduction.

     To date, Michigan citizens have received approximately $803 million in benefits from the settlement. The State of Michigan also received a direct payment of $97 million from the servicers.  Schuette worked with the legislature and Governor Rick Snyder to establish the Michigan Homeowner Protection Fund to ensure these funds are directed toward victims of foreclosure. On August 1, 2012, Governor Snyder signed legislation creating the $97 Million Homeowner Protection Fund

     Citizens who believe they may have been victims of Steven Ruza and/or Home Legal Group are encouraged to file complaints with the Attorney General’s Office at www.michigan.gov/ag by clicking “File a Complaint.”

     A criminal charge is merely an accusation and the defendants are presumed innocent unless proven guilty.  

 

 

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Schuette Charges Former U.P. Prison Employee with Felony
  

 

   May 20, 2015              

     LANSING – Michigan Attorney General Bill Schuette today announced that his Criminal Division has filed a felony charge against a former Aramark supervisor employed at Kinross Correctional Facility for allegedly soliciting an inmate to help orchestrate the assault of another inmate. Schuette charged Michael R. Young, 27, of Kincheloe, with one count of Solicitation to Commit Assault with Intent to Cause Great Bodily Harm, a felony punishable by up to five years in prison. The case was jointly referred to the Department of Attorney General by the Chippewa County Prosecutor’s office and the Michigan State Police (MSP).

     “If you try to take the law into your own hands to exact revenge, there will be consequences,” said Schuette.  “Criminal charges in this case are the result of a thorough and exhaustive investigation. I want to thank the Michigan Department of Corrections, Michigan State Police and the Chippewa County Prosecutor’s office for their help and hard work on this case.”

Background on the Case

     Young was employed by Aramark at Kinross Correctional Facility in Chippewa County. In 2014, a Kinross inmate allegedly reported to the Michigan Department of Corrections that he was solicited by Young to find an inmate to assault another inmate incarcerated at a different correctional facility. Young allegedly told the inmate that the target inmate was serving a sentence for the murder of one of Young’s relatives and provided the inmate with details like the name and prisoner number of the target inmate. It is alleged that Young offered tobacco products to the inmate in return for recruiting an inmate at the other facility to carry out the proposed assault.  At the joint request of the Chippewa County Prosecutor’s office and MSP, Schuette’s Criminal Division conducted an extensive investigation into the allegations with collaboration from MSP and the Michigan Department of Corrections.

     On May 19, 2015, Schuette’s Criminal Division filed the following criminal charge against Michael R. Young in Chippewa County’s 91st District Court in Sault Ste. Marie:

  • One count of Solicitation to Commit Assault with Intent to Cause Great Bodily Harm, a felony punishable by up to five years in prison.

     Young was apprehended by authorities in Kincheloe on May 19, 2015 and will be arraigned in Chippewa County’s 91st District Court in Sault Ste. Marie at 11 a.m. Young was assigned a $50,000 cash bond and is currently being held in the Chippewa County jail.

     A criminal charge is merely an accusation and all defendants in this case are presumed innocent unless proven guilty.
                                                                           Mug shot of Young                                 

                                     

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Schuette, Worthy, Etue, Craig Announce New Resources for Sexual Assault Evidence Kit Cases
  

 

   May 19, 2015           

 

     LANSING – Michigan Attorney General Bill Schuette, Wayne County Prosecutor Kym Worthy, Michigan State Police Director Colonel Kriste Kibbey Etue and Detroit Police Department Chief James E. Craig today announced they have expanded the Wayne County Sexual Assault Kit Task Force responsible for investigating and prosecuting leads resulting from the DNA testing of thousands of abandoned sexual assault kits discovered in a Detroit Police Department property storage facility in 2009. 

     The Task Force, comprised of officials from the Department of Attorney General, Wayne County Prosecutor’s Office, Michigan State Police, Detroit Police Department, Michigan Domestic Violence Sexual Assault Prevention and Treatment Board, Wayne County SAFE, the YWCA and the Joyful Heart Foundation is funded by the participants and a one-time, $3 million state appropriation approved by the legislature last year.  Following the development of a work and spending plan, the task force is expected to operate in this expanded capacity until September 30, 2017.

     Today’s announcement is another step forward on the road to justice for victims whose sexual assault DNA evidence kits were never processed, allowing rapists to remain on the streets perpetrating more sexual assaults.  Previously, in June 2013, Schuette and Worthy joined Governor Snyder to announce the use of $4 million in legal settlement funds obtained by the Department of Attorney General  to fund the testing of thousands of evidence kits by the Michigan State Police.  With today’s agreement, the task force will increase the rate at which leads produced by the testing will be investigated and prosecuted, prioritized by a focus on the worst offenders, the statute of limitations and the risk to public safety.

    “Our duty is to get rapists off our streets and deliver the justice victims are owed,” said Schuette.  “The organizations working together on this task force have made this effort a priority and I am proud to be a part of it.”

    “It is nice to officially welcome the Department of the Attorney General to our longstanding collaborative,” said Worthy.  “These additional resources will enable us to not only continue our work on the Detroit cases, but will enable us to follow through on DNA hits outside of Wayne County and the State of Michigan that we have not been able to focus on before.  This, in conjunction with our Enough SAID Initiative is moving this project along.”

     “The use of criminal analysts to support investigators in our Secure Cities detective bureaus has been a tremendous asset that has not only lessened the burden on investigators, but also increased the solvability of crimes,” said Etue. “We are pleased to be able to offer this valuable assistance to this long overdue effort to bring justice for these victims.”

     “This is truly a collaborative effort and the Detroit Police Department is committed to working with the Attorney General, Wayne County Prosecutor and the Michigan State Police to bring closure to the victims of these heinous crimes,” said Craig.  “I’m confident that, with all of these resources focused on solving these cases, we will be able to solve many of them and bring these criminals to justice.”

     Each entity has assumed the following responsibilities and may seek to provide the following personnel for the task force, funded by the $3 million appropriation:  

  • Attorney General: Investigation and prosecution of cross-jurisdictional and out-of-state cold case sexual assaults, in conjunction with county prosecutors: Two full-time investigators and one Assistant Attorney General (prosecutor) on the task force.
  • Wayne County Prosecutor: Prosecution of cases in Wayne County: Two prosecutors, one Crime Victim Advocate, one paralegal/statistician, one clerical assistant and one investigator on the task force.
  • Michigan State Police: Analytics and data reports on sexual assault kits as they are tested, investigated and prosecuted, and assistance on investigations: Two Criminal Intelligence Analysts, one in Detroit and one in Lansing.  
  • Detroit Police: Six investigators, currently housed in the Wayne county Prosecutor’s Office, at no cost to the task force. The Detroit Police Department will investigate sexual assaults in the City of Detroit and cross-jurisdictional matters involving the City of Detroit.

Ongoing Efforts to Bring Justice for Victims, Strengthen Public Safety

     In 2009, more than 11,000 untested sexual assault kits dating back more than 30 years were discovered in a Detroit Police Department property storage facility, each holding the potential to solve multiple crimes, including those committed by serial rapists.  The MSP’s Forensic Science Division has been instrumental in the laboratory analysis of sexual assault kits by working with privately contracted laboratories, the Wayne County Prosecutor’s Office, and the Detroit Police Department, on efforts to test the remaining sexual assault kits.  A majority of these kits have been tested and the remainder should be completed by this fall.

     Michigan victims of sexual violence are encouraged to call the national sexual assault hotline toll-free, 1-800-656-HOPE.  All calls are confidential, and will be answered by a local counseling center affiliated with the Rape, Abuse & Incest National Network (RAINN).  Assistance is also available online at www.rainn.org

 

 

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