California Real Estate Fraud Report

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Better Business Bureau for Real Estate Professionals?

The National Ethics Bureau, based in San Diego, California, announced that effective December 18, it will begin accepting applications from real estate agents, brokers and mortgage brokers into the NEB. For the annual fee of $235, plus an “initiation” fee of $95, said professionals will have the right to use the NEB’s branding in their marketing materials, sort of a “Good Housekeeping” stamp of approval.

This purportedly will give consumers more confidence by providing them with what is essentially a lack of negative information report by the NEB. According to the NEB’s Chairman Steven R. McCarty:

“The real estate industry is under stress due to the market downturn, credit crunch, and sub-prime crisis. Unfortunately, this has increased unethical sales practices and outright fraud, especially in sub-prime mortgage applications. As a result, consumers today have less faith in the integrity of the real estate industry. By qualifying for NEB membership, real estate professionals can take a bold step to restore public confidence and lay the groundwork for future growth.”

The F Word opines that fraudulent practices didn’t suddenly appear during the current downturn but were part-and-parcel of the problem that in fact led to said downturn: banks and non-institutional lenders radically loosening qualifying criteria, literally inventing the “liar’s loan” in order to write loans to anybody with a pulse, and possessed of the same mindless notion as home buyers, namely that prices would rise indefinitely and that equity increases would offset their risk.

The National Ethics Bureau is a reinvention of the Better Business Bureau: charge businesses – more like a ransom or pay-to-play – for the privilege of being listed with the aforementioned as not having any marks against them. In the case of real estate professionals, that would be criminal prosecutions, civil litigation or ethics complaints with their respective licensing boards. The F Word believes that lack of a negative event is neither proof nor comfort to the consumer that the professional in question is not currently committing fraud or other tortious acts that have yet-to-be detected.

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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