Authorities Shut Down A Mail Scam

A direct-mail scheme in which solicitations resembling property-tax bills were sent to recent home buyers in Burlington, Camden and Gloucester Counties has been shut down by consumer agencies and the U.S. Postal Service.

"The official-looking envelope, with its snap-out insert, was nothing more than an attempt to collect money for a service that has no significant value to new home buyers," said Edward McGoldrick, director of the Gloucester County Office of Consumer Affairs in Woodbury. "The mailer was deceptive in that it used a form similar to a tax statement but offered nothing that new home buyers could not do for themselves."

A settlement with the Postal Service is pending, according to postal inspectors in Newark, N.J. Postal authorities said the mail-order firm, Consumers Escrow Audit (CEA), could no longer use its postal box in central New Jersey to conduct business.

"CEA hasn't officially closed its box, but mail is being held due to the investigation," said Michael Riparo, postal supervisor for Milltown, N.J.

"We're no longer accepting new customers, and we've returned money to anyone who requested it," said Steve Milbrod, whose tax-consulting firm, Milbrod Valuation Corp., of East Brunswick, N.J., operated CEA. "This venture is in terrible financial shape, and I've decided to close it."

According to Milbrod, during January and February CEA sent direct-mail packages to 1,200 residents of newly purchased homes in Burlington, Camden and Gloucester Counties. The mailers resembled tax bills but were actually solicitations for a service to review tax assessments and obtain literature on assessment appeals.

Labeled "Post Settlement Assessment Recovery Notice," the packages identified the resident's house block and lot number, sales price and purchase date, and mortgage lender and loan amount. The text of each notice suggested that the borrower's mortgage company might be collecting too much in escrow payments or failing to properly credit those payments to the homeowner's account. It further instructed recipients not to forward the mail-order notice to their mortgage company.

Homeowners were instructed to send $82 to CEA's Milltown post-office box.

Homeowners in Deptford, Berlin and other South Jersey municipalities complained about CEA to county consumer-affairs officials. Consumers voiced concern about CEA's direct-mail notice and the cost of its assessment-checking service, said officials of consumer agencies.