Local financial services company MCA Consulting is under investigation for allegedly operating in the home loan modifications business without a license.

According to a King 5 News report, which aired April 1, Pierce County resident Della Lorenzen was initially contacted by the company to help renegotiate her payment on an adjustable-rate mortgage.

KING 5 said Lorenzen’s was contacted by MCA Consulting, at 802 Kirkland Avenue, who asked for a fee to renegotiate her mortgage. The trouble is, MCA does not appear to have the appropriate licensing under state law.

The company reportedly received a letter from DFI in February that accused them of closing loans without a license.

The state Department of Financial Institutions (DFI), which is handling the investigation, is warning homeowners to only use licensed loan originators, mortgage brokers, or consumer loan companies to prevent the growing incidence of fraud.

DFI attorney Steve Sherman confirmed the company was under investigation on suspicion of conducting unlicensed mortgage modification and refinancing.

“We’re just at the beginning,” he said. “They could be held responsible.”

A violation of the Mortgage Broker Practices Act, which regulates such activities, could result in a misdemeanor charge for each offense and a fine of $100 per day, said Sherman.

In response to the allegations, MCA co-partner Ed Clarke disputed the suggestion his company had done anything wrong. He said MCA was only marketing the services of Los Angeles-based EQ Group, who specialized in loan modifications. Clarke said they was using MCA to locate likely customers for their services and Lorenzen never signed or entered into a contract with MCA. He conceded the process to reach an agreement with Lornezen’s lender took much longer than what MCA had told her, but offered in his defense the unanticipated surge in the loan modification market overwhelmed the system.

“We were trying to help folks out,” he said.

He disputed DFI accusations that his company had broken the law and called the claim reckless.

“There was no guidance given by the state … No oversight, no clarification,” he said. “DFI’s (statement) on loan modifications was issued on March 13 of this year.”

Clarke later clarified the DFI advisory was issued March 10 and said they have fully complied with the DFI statement from the date of issuance.

As for Lorenzen, the Clarke claims she did receive an offer to extend her 7 1/2 percent mortgage-rate for five years before it reset to 9 1/2 percent, but declined it. He said days before the King 5 News story aired, EQ responded to her request for a refund and sent it by FedEx delivery.

MCA is owned and operated by Clarke, who is also a branch manager at Home Savings Bank, and Brian Meek.