More funding is now available to fight real estate fraud

Upset with the rise in property crimes, and concerned about desperate home-owners--especially seniors--being victimized by scams, officials from the Santa Clara County District Attorney's Office said last week that they are taking a more active approach to real estate fraud and now have the resources to fight these crimes.

Deputy district attorneys Kim Connors and Mike Fitzsimmons asked real estate agents for their help in fighting real estate fraud.

Realtors are in the trenches and know what is happening to homeowners. "You are our eyes and ears," said Connors.

Real estate fraud has been on the rise since the mortgage meltdown. "Desperate homeowners are ripe to be victims of loan modification and other scams," said Fitzsimmons.

The good news is the district attorney's office now has more funds to fight property crime issues. Fitzsimmons explained financing to fight real estate fraud comes from recording fees. Before this year, $3 from each recording fee went to the unit; this year, $10 will go to toward real estate fraud prosecution.

The increased funding has allowed the office to beef up its real estate fraud unit with four prosecutors, three full-time paralegals and seven investigators. One paralegal is solely engaged in reviewing changes in titles, sending out letters to homeowners verifying authenticity, and letters to homeowners who have received notices of default, with information on what they can do and victim prevention tips.

"We have a lot more money to work with and will be hiring more attorneys and investigators. If you see suspicious activity, report it to us. With new funding, we now have the ability and higher capacity to deal with these crimes," said Fitzsimmons.

Source: http://www.lawyersandsettlements.com/articles/financial-elder-abuse/interview-financial-elder-abuse-6-19315.html#.UpwQoT9qMcE

Walnut Creek, CA: Defrauding elderly Americans of their life savings is a multibillion-dollar problem in the United States. Attorney Craig Niven's law practice partly focuses on trying to recover assets for seniors who have fallen prey to the perpetrators of all kinds of cruel construction and real estate swindles.

"They poke and prod elderly homeowners into doing home repairs they don't need at hyper-inflated costs. They fiddle with loan documents, falsify the seniors' income or deceive seniors about the monthly repayment costs. Then suddenly the senior is stuck with a mortgage they can't afford and a monthly payment that might be equal to their entire income.

"I would say those are the most horrible cases. It becomes a toxic situation and they can actually lose their home," says Niven.

A fly-by-night construction rip-off is, of course, not new. It's as old as the hills and it can happen to homeowners at any stage of life. The problem is that when it happens to seniors, living on fixed incomes, their earning years long gone, it is a lot harder to recover from being cheated says Niven.

Sometimes Niven can help seniors who have been bilked in construction and real estate exploitation, and sometimes he frankly admits he can't. He "triages" every new case that lands on his desk. He doesn't encourage seniors to spend money on legal fees in cases where there is no hope of getting back what's already been lost. Unless there is a real possibility of recovering the assets or collecting, he absolutely won't go forward.

"Sometimes it's the neighbor or relative that comes in and befriends the senior and gets control of the assets," says Niven. "Unfortunately, assets are often squandered before you can recover, but sometimes not. Sometimes it's a rising market and the assets have been leveraged, so you still might be in a good position. You have to triage the situation and see how to unwind some kind of horrible transaction."

Niven made a substantial recovery for an elderly couple who had been hoodwinked into refinancing their mortgage at a rate double what they had been led to believe it would be. The tricksters were agents of a real estate company that, as Niven says, "employed people they knew were making false promises and shuffling documents."

The sales people involved skipped the country, but Niven went after the real estate company and its insurance coverage. "They stepped up and made good for my clients. They had to unwind the loan and pay attorney fees and costs."

There is also something called a "creditors suit" that can be used to snatch back assets lost through fraudulent means.

"If someone is a scam artist and puts everything in that relative's name, you can sue that relative and recover for the client," says Niven. "If you just see assets in a relative's name, that should not dissuade an attorney.

"We had a case recently where we didn't just sue the defendant but we sued the relatives because we knew the scammer kept the property in the relatives' names. We knew eventually that's where we would have to go to recover so why not do it all at the same time," says Niven.

"Every case is different," says Niven. "It just depends."

Read more:
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http://ireport.cnn.com/docs/DOC-1064787?ref=feeds/latest

Back in the heyday of the Bitterroot Valley's housing boom, Bitterroot Valley appraiser Darwin Ernst said one local mortgage broker used to say: "You show us the house; we'll show you the money."

Real estate fraud was more common than people realize, Ernst said.

"In some cases, people just didn't know," he said.

During the housing boom, the valley had about 10 unlicensed mortgage brokers. Today, two licensed brokers remain in business.

Inflated home prices, creative financing, and misrepresentations on loan documents weren't issues that just happened somewhere else in the country, Ernst said.

New regulatory requirements that followed the housing market bust has changed the way people do business.

A two-day seminar on real estate fraud coming to Hamilton Monday is designed to help real estate agents, appraisers and lenders avoid the pitfalls of becoming an unsuspecting participant in mortgage fraud, Ernst said.

The seminar is hosted by the Bitterroot Valley Board of Realtors. It will be held at the Bitterroot River Inn on Monday and Tuesday, Nov. 18 and 19.

The first day focuses entirely on the kind of scams that can occur in real estate transactions and how to avoid them.

The second day is set aside for appraisers to consider issues of adjustments, independence and mandatory reporting requirements.

Anyone interested in attending the seminar can call the Bitterroot Valley Board of Realtors at 363-2000 to register.

Read More:
http://missoulian.com/business/local/real-estate-fraud-seminar-coming-to-hamilton/article_1088f90e-4e1d-11e3-8d6e-0019bb2963f4.html
https://www.evernote.com/shard/s335/sh/9927d7db-4133-4014-8446-3deaa35445c5/2d502d5e2c52a85dc122c6e8011d01e1