Under terms of a settlement announced by Oregon Attorney General John Kroger, a California law firm is prohibited from providing loan modifications in Oregon and is required to pay $28,857.

"I will not hesitate to take action against companies that attempt to take advantage of Oregon homeowners in distress," Kroger said.

The settlement followed an Oregon Department of Justice investigation that determined The USMAC Law Group had violated state law by collecting advance fees for loan modifications to prevent foreclosure sales.

The DOJ's investigation also focused on alleged non-compliant contract language and deceptive infomercial advertisements for the firm's loan modification program that aired nationally on satellite television.

Loan modification companies are prohibited from collecting advance fees and using confusing contract language by the 2008 Oregon Mortgage Rescue Fraud protection Act.

The USMAC Law Group will provide $6,857 in refunds to two Oregon consumers and an additional nine Oregon consumers who contracted with The USMAC Law Group may also be eligible for refunds. The remaining $22,000 will be paid to the Oregon Department of Justice. No wrongdoing was admitted by The USMAC Law Group in agreeing to the settlement.

The settlement with The USMAC Law Group comes as part of a crack down on unscrupulous loan modification work to fight the foreclosure crisis by the Department of Justice, the Department of Consumer and Business Services, the Oregon Legislature and consumer groups, Kroger said.