Mortgage scam alerts to be run by the Fed in movie theaters

In a move to protect customers from mortgage frauds the Federal Reserve is launching a new advertising program to show short reels in the movies across 7 states in 14 largest cities with high-foreclosure housing markets. The initiative is aimed at warning homeowners against foreclosure scams which became usual in times of mortgage crisis. Exploiting the situation scammers lure customers into paying thousands of dollars for helping them to arrange government aid to keep their homes, something that is provided by nonprofits working with the government for free.

As the Wall Street Journal reports the “30-second segment, built around text and an audio voiceover, features still photos of individuals and families. The opening line: "Are you facing foreclosure?" And the finale: "It shouldn't hurt to get help!" The closing shot guides viewers to foreclosure tips and other housing-related information on the central bank's Web site.”

"People who are facing foreclosure are stressed enough," said Sandra Braunstein, director of the Fed's Division of Consumer and Community Affairs. "The last thing you need to do in a situation like that is put out a couple thousand dollars. There are people out there who can help and do not charge."

According to the Fed’s schedule its initial ads will run before movie previews for a week starting April 9 in theaters across seven states -- Arizona, California, Georgia, Florida, Michigan, Nevada, Ohio, the states that were hit most by foreclosures. The project is produced in association with National CineMedia and costs the Fed $9,000 for production and placement in movie theaters.

The promotion is directed against infomercials, billboards and door-to-door marketing from firms who try to attract customers confused by their options. It is the first time the Fed puts ads in movie theaters. No Fed officers will be featured in the reels.