California Real Estate Fraud Report

Realtors® in the community of Chula Vista are speaking up about a firm that they allege is illegally renting out listed homes and making a lot of money doing so.

The firm, called “Prudent Constituents Association,” is allegedly filing fradulent quitclaims in San Diego County, then taking possession of homes that legitimately belong to others. Realtor® Steve Lemack says “They’ll take off the lockboxes that are on [the homes], take all the signs down, they change the locks and they put up their own signs.” He says further that PCA is charging renters $2,000 per month and that they control 30 properties or more.

The Prudent Constituents Association is purportedly a non-profit formed by Derrick and Diane Brown after their own home was foreclosed. Diane Brown, who also goes by the name Harmony stated “All these homes where people are being evicted by the lenders are wrongful evictions.” 

Neither the Chula Vista Police Department nor the San Diego County District Attorney’s Office, both of which were contacted by real estate agents, would acknowledge they are investigating PCA.

A note to prospective renters: I could not find any registration of the PCA as a non-profit, nor do they have a prominent (if any) website. This should be a hint that you might be dealing with an organization that is not legitimate and that you should investigate them further.

Read the original article in San Diego’s 10News.

As reported on the California Real Estate Fraud Report last year, fraudsters are using Craigslist to rent properties for which they have no authority to either take deposits or rent.

A new article in the Silicon Valley Mercury News details that this form of rental fraud may be on the increase. With more homes going into foreclosure, many are vacant. Real estate criminals look for properties that are vacant, change the locks and begin advertising the properties for rent. Craigslist is probably the most common advertising location as ads may be posted for free.

Some criminals are now advertising homes that are actually listed for sale and creating their own rental ads, hoping to catch a person desperate to rent – perhaps after losing their own home to foreclosure – and collecting a deposit.

If you are looking for a home to rent, heed the advice of Craigslist on its own website:

“Never wire funds via Western Union, MoneyGram or any other wire service — anyone who asks you to do so is a scammer.”

If you are uncertain that the person with whom you are speaking is the property owner or works for a property management company, ask for their identification.

There is also an excellent article on rent fraud in the Martinez News-Gazette.

AB 1800, the proposed legislation that would double the misdemeanor penalties for posing as a landlord, will be heard on the California State Senate Floor in August. Posing as a landlord in order to collect deposits from unwitting prospective renters, has been facilitated in by online housing services, especially Craig’s List. With 22% of the nation’s vacancies, California is fertile ground for this form of real estate fraud.

AB 1800 is co-authored by Assemblywoman Ma (D-San Francisco) and Assemblyman Hagman (R-Chino Hills).

Read the full article in the California Chronicle.

Craig’s List, a great idea for bringing buyers and sellers of products and services together, has also become a magnet for criminals. Rental fraud, a crime in which homes are rented to tenant-victims by non-owners, has in particular become associated with Craig’s List.

In this case, a former NFL fullback and Super Bowl winner named James Hodgins has been arrested for his role in a scam stealing money from prospective renters by fraudulently renting out homes they do not own, according to police. Hodgins’ alleged partner in crime is Carlos Gomez, who was already arrested on suspicion of fraud, theft under false pretenses and burglary.

Victims have been calling in, forcing the District Attorney’s Office to hold off filing all of its charges until the investigation is complete. But according to Oakley police Detective Sean Eriksen “This is going to be pretty big.”

The victims were defrauded when they applied for rentals posted on Craig’s List by individuals using phony names and corporations designed to hide the criminals’ identities. They made cash deposits for the so-called rentals as well as first and last month’s rents. But the homes were vacant, either due to foreclosure or short sales, and according to police were broken into by James Hodgins and Carlos Gomez.

Read the full article in the Silicon Valley Mercury News.

The next time you see a home for rent in Craigslist at a price that looks too good to be true, think twice: it might be.

Both prospective renters and property owners wanting to rent their homes are finding themselves victimized by con artists, who troll Craigslist for vacant properties and post their own ads in the hopes of scamming a few hundred or thousand dollars by “renting” a house.

Some of the frauds are caught by the tenants, who see multiple ads for the same property but at different monthly rents. And one ad posted recently by a property owner boldly stated that her property was being fraudulently “listed” by a person she named outright.

According to Laura Upland of the Solano County District Attorney’s Office, many of the suspects are Nigerian, having honed their careers previously in credit card fraud.

In one instance in Vallejo, a woman seeking to rent a house called the number in the ad after her rental application was approved in 20 minutes without her providing her social security number or bank account numbers. She was uncomfortable about sending her deposit via Western Union. When she asked the so-called owner to describe where Vallejo was, he hung up the phone.

Renters: one way to protect yourselves is to ask a Realtor to run a title report to see if the name of the owner on title matches that of the caller. It’s not a perfect system but could help the renter lose his or her money to a thief.

Read the Full Article in the Vallejo Times Herald.

Bad news for those who commit real estate fraud and mortgage fraud in Ventura County: the Ventura County District Attorney’s Office has just received almost $1.7 million in federal stimulus money to fight real estate crimes.

As a result of this good use of taxpayers’ dollars, the D.A.’s office will add one prosecutor, two investigators and an assistant to its team assigned to fighting real estate fraud according to Ventura County District Attorney Greg Totten.

If you live in Ventura County and believe you are the victim of a real estate fraud, click here for the Ventura County District Attorney’s Office to find complaint forms.

Read the Full Article in the Ventura County Star. This article is also reprinted in Examiner.com by the L.A. Fraud Examiner.

Here’s a scheme that has sprouted from the increase in bank-owned, aka REO (real estate owned) market. It should outrage every honest, hard-working person who plays by the rules and doesn’t want to subsidize those who don’t.

Read my article on my channel as the L.A. Fraud Examiner on Examiner.com

No news to honest real estate professionals, home buyers and sellers: the San Fernando Valley is “awash” in real estate fraud, mortgage fraud, appraisal fraud, foreclosure fraud, rental fraud – you name it, we have it.

Residents wanting to learn more about foreclosure fraud were treated to excellent speakers at a meeting hosted by the Shepard of the Hills church in Porter Ranch. Detective Erin Camphouse, of the LAPD Real Estate Fraud Unit observed  “I think the Valley and South Los Angeles are two higher frequency areas (of foreclosure fraud).”

Read the Full Article in the San Fernando Valley Sun.