PHILADELPHIA (KYW Newsradio) — A Philadelphia City Council committee has advanced a bill that would allow the city to sue on behalf of residents scammed by a long list of deceptive practices.
Timothy Calhoun was very proud of owning his North Philadelphia home, free and clear — no mortgage. In 2022, he saw an ad for a “homeowners benefit” that provided a $600 cash payment for agreeing to list his home with Florida-based MV Realty, if he ever should decide to sell.
A short time later, the city’s Department of Records called to alert him that MV had put a mortgage on his house.
“I was shocked. They never told me I was signing a mortgage,” Calhoun said. “If I would have even heard the word ‘mortgage,’ I would have hung up that phone.”
Calhoun told his story to Council’s Commerce Committee to support a bill that would allow the city’s Law Department to bring action against businesses who engage in any one of more than 20 specific deceptive practices, including selling knock-offs, false advertising, reneging on warranties, exaggerating a product’s benefits, and even pyramid sales schemes.
City Solicitor Renee Garcia says the city would no longer have to depend on the state to take action.
“The Law Department would be able to take swift action in the Court of Common Pleas, seeking remedies such as injunctive relief, civil penalties and restitution for affected consumers,” Garcia said.
The Federal Trade Commission estimates that 97,000 consumers in the Philadelphia area were victims of some sort of fraud, last year.
Philadelphia would be one of the first cities in the country to have a local consumer protection law. Bill sponsor Councilmember Rue Landau says she hopes the bill will have a preventive benefit.
“When scam businesses want to start preying on folks, they know: Don’t come to Philadelphia, because we have excellent lawyers in our Law Department who are watching, who want to come after them, who are here to protect Philadelphians.”
Garcia concedes the logistics are complex — from how to take in complaints to creating a new position for the litigation — but she says she’s ready to take them on.
As for Calhoun, he’s still in a bind. Pennsylvania sued MV, as did a lot of other states. The cases were consolidated in Florida last September. Three days later, MV filed for bankruptcy.
The City of Philadelphia issued a specific warning about MV Realty in 2022.