A Canadian couple was surprised to learn their investment property in Lake County had been sold last summer.
They owned the two family plots for more than a decade, never putting them up for sale or intending to part with the land. According to experts, this is happening more and more often.
The family fell victim to the scam, a cybercrime with thousands of cases across the country where a fraudster takes ownership of a property by forging deeds and submitting them to county officials.
“They have notarized documents… and they are all fake,” said Xiao Zhuo Jia, the couple’s grown son, who helped untangle the mess. “In this case, you see the signature: you can tell what letters they write, and it doesn’t match my parents’ name.”
The two lots were purchased in 2007 when a developer traveled to Canada and pitched the future subdivision as a perfect investment amid the housing boom, he said. Soon after, however, the market crashed and a recession followed; the properties were never built. The lots have been mostly vacant since then, Jia said.
Experts say this makes the property owner particularly vulnerable.
The scheme is known by a variety of terms such as property theft, deed theft and home theft, and is particularly common in Florida because of the high number of foreign landowners and vacant lots, said Mickey Godat, president of the Florida Land Title Association. .
“These transactions happen every day all over the state,” said Godat, whose office is in Lake Mary. “It’s really grown over the last year.
It happens in several ways, he said: Someone obtains a fraudulent deed and transfers the property to their name; someone steals the owner’s identity and sells the property; or someone fraudulently takes over the company that owns the land.
As the scale of the fraud has exploded, Godat said insurance companies this year have begun further scrutinizing the deeds to see if any recent transactions occurred for little or no value. They also try to make contact with buyers and sellers and try to match signatures if there are examples in the public record.
Unsecured properties and those that are vacant or owned by absentee or international owners are targeted by fraudsters, he said.
“Right now, we’re looking at every single one of these transactions as fraudulent,” he said.
Few scammers are caught and prosecuted, although earlier this year the Broward County Sheriff’s Office arrested two women who one investigator said fraudulently obtained 67 properties across the state, even though some were outside the statute of limitations, the Sun-Sentinel reported. They were charged with fraud, grand theft and exploitation of the elderly, the newspaper said.
County clerks and comptrollers who file deeds and public records legally must file them if they’re properly completed and can’t reject a potentially fraudulent document, Orange County Comptroller Phil Diamond said.
He and other local officials have set up alert systems where property owners can sign up and be notified by email if a listing is submitted on their behalf. While it can’t prevent fraud, at least it gives the victim an early warning, he said.
“That’s one of the reasons I started this service: we’re required to record documents that meet Florida charter standards, and I wanted to make sure we were doing everything we could to protect the citizens of Orange County,” Diamond said.
According to him, about 40,000 residents have signed up since 2018.
In Lake County, official records manager Holly Vaughn said more than 3,600 property owners have signed up.
Seminole and Osceola counties also have alert systems.
“It’s an early detection system, and that’s critical when you’re trying to combat property fraud,” Vaughn said.
Cases of fraud have been documented from coast to coast, prompting a member of Congress to file legislation in hopes of curbing the crime.
Missouri Rep. Emanuel Cleaver, D-Kansas City, filed legislation last month called the Good DEED Act that would define the act of fraud in U.S. law and require the FBI to track it in its annual Uniform Crime Report.
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“It’s important right now more than ever because one of the hardest things to buy right now is a home,” said Cleaver, who chairs the House Subcommittee on Housing, Community Development and Insurance.
His bill, filed in October, also provides funding for programs that detect and prosecute fraud and requires states that receive funds to require fingerprints and other identification from people who submit documents.
While Democrats lost control of the House in the midterm elections and Cleaver will have to relinquish his post as speaker, he said he is willing to work with anyone to move legislation forward.
“You can’t fight something if you don’t name it,” he said. “We have to define it and then we have to see how widespread it is.”
After months of working to sort out the mess, Jia’s family finally decided to sell their property to a company that bought the land from the scammers. The home builder thought the sale was legal, he said, and had already begun laying the foundation and preparing to build.
“Fortunately, we didn’t have to involve a lawyer because both sides wanted to come to the table,” he said. “It’s been a stressful and stressful few months to sort it out.”