Colorado's largest foreclosure law firms accused of fraud

Home Mortgage Associated Press

Colorado's two largest foreclosure law firms have been accused of defrauding homeowners, banks and investors.

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The Denver Post reports ( ) that The Castle Law Group and Aronowitz & Mecklenburg were sued Tuesday by the state attorney general's office.

The newspaper says that the Aronowitz firm immediately agreed to pay $10 million to settle the case. The firm will either sell or close its Denver-based law practice in the next six months.

Castle is expected to fight what is likely to be a long court battle over an investigation that lasted more than two years.

Allegations in Tuesday's complaints include collusion between law firms to set the price on process services fees associated with foreclosure cases.

Combined, the law firms handled more than 150,000 foreclosures in Colorado since 2006.

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Information from: The Denver Post,