WASHINGTON — As the Obama administration continued to hammer out details of its foreclosure prevention program with major banks, the Treasury Department on Monday unveiled a coordinated plan to thwart loan modification fraud schemes that are cropping up around the country.

The Treasury is acting along with the Federal Trade Commission, the Department of Housing and Urban Development, the Justice Department and state officials to prosecute or disable businesses that claim to be able to secure loan modifications from lenders for up-front fees. In statements to the press, officials from the agencies urged borrowers to contact their lenders directly or seek help from free credit counseling services or from state agencies.

HUD Secretary Shaun Donovan said in an interview after the announcement that HUD had separate plans to increase oversight of major lenders and loan servicers planning to participate in the administration's loan modification program, but that details of the program were still being worked out.

"A key part of the Making Home Affordable plan," Donovan said, "is the oversight that we're going to be doing to make sure that as we're applying this plan to the portfolios of the largest servicers — they make up 65% of all the mortgage servicing in the country today — we will have very strict procedures in place to review their modifications and do quality assurance, make sure they're actually providing modifications that are having a positive effect and as part of that we mean catching instances of fraud."

Consumer protections in the Truth-in-Lending Act and the Real Estate Settlement Procedures Act do not apply to loan modifications unless the modification involves a refinancing or there is an increase in monthly payments or the interest rate on the loan. But Donovan said officials overseeing the administration's loan modification program would use "contractual relationships" with servicers participating in the program as means to enforce standards for loan modifications.

President Obama unveiled the administration's loan modification plan on Feb. 18. Major banks and loan servicers pledged to participate, but to date no servicers have actually signed up.

"They have all agreed to participate," Donovan said. "We have been working through all of the details with them."

Anne Canfield, the executive director of the Consumer Mortgage Coalition, said that many servicers had already begun aggressive modification programs for the loans they held on their books, and that servicers were planning to participate in the Obama administration's plan once it was operational.

In the meantime, FTC Commissioner Jon Leibowitz said, some mortgage servicers had agreed to assist the government's efforts to combat loan modification fraud by sending warnings of potential scams directly to their customers.

Chase Home Finance, SunTrust Mortgage Inc. and GMAC Mortgage will send information about fraudulent loan modification companies to borrowers using their monthly statements, counseling sessions and correspondence with delinquent borrowers.

"We are encouraging others to follow their lead, and I think many of them will," Leibowitz said during Monday's press conference.

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