The fees aren't deductable for a loan modification (unless they are points/interest), even if the entity is not a scam. If the deal was a fraud, then you can report it as a theft loss and deduct all of the fees in the year that you paid them.
If you are audited, the IRS will likely want to see that you reported the transaction to some law enforcement agency -- otherwise, it could deny your deduction as lacking sufficient corroboration. However, if you allege that the business took your money under false pretenses with the intent to permanently deprive, by never providing you with any services, then that is sufficient to satisfy the requirements of the deduction, even if the case is never prosecuted and even if the business operators are never arrested.
Hope this helps.
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