Tuesday, January 1, 2013

Financially Distressed Homeowners Face Criminal Prosecution For Recording Bogus Land Documents To Stall Foreclosure

In Stanislaus County, California, The Modesto Bee reports:

  • Authorities' patience with people facing foreclosure — normally a sympathetic bunch, especially in the Central Valley where rates are sky high — wears thin when owners might be using illegal means to keep their homes.

    Fraud investigators say they are seeing an emerging foreclosure rescue scheme in which desperate homeowners record phony documents — a felony — simply to stall losing property at public auction.(1)

    The cost of buying time can be steep: The homeowner typically pays a bundle of money for bogus forms and learning how to use them, often loses the property anyway and then faces criminal charges.

    In the past couple of weeks, authorities have launched prosecutions against four Stanislaus County property owners. All were warned when investigators got wind that the owners might be up to something, but each returned later or sent someone else to try to file fake papers again.

    "It comes to a point where enough is enough," said Jeff Mangar, a prosecutor with the district attorney's real estate fraud unit. "How many breaks can we give these people?"

    They include a mortgage company owner, a gas station cashier who obtained a $648,000 loan and a woman who said her lender should pay her $2.5 million. Two told The Bee they are innocent; the others could not be reached.

    Some fell into schemes pushed on the Internet, they told authorities.

    A website reviewed by The Bee encourages owners to fight back against greedy banks engaging in unscrupulous robo-signing and refusing to renegotiate loans. The site brags that none of its 2,600 customers has made a mortgage payment in the past two years.

    "We essentially tie the banks up in administrative proceedings," the site says. When lenders catch on to delay tactics, "our team is counter-maneuvering to tie the bank's legal team up in administrative red tape" with more filings, the site says.

    Clerks at the recorder's office in Stanislaus County are getting wise to suspicious documents and tip off investigators, who rush over from a couple blocks away and sometimes arrive before people leave the recorder's office.

    "We are the government (too)," said county Clerk- Recorder Lee Lundrigan. "If the purpose of making a document public may be criminal, we communicate that information to the DA's fraud team and they can make the final determination."
For more, see Fake filings aim to stall valley foreclosures, prosecutors say.

(1) This "technique" for stalling the foreclosure process is an unlawful version of what is generally referred to by some real estate operators as "clouding the title."

Not to be confused with "crowding the title" - a maneuver in which an enterprising property owner conveys small fractional interests in his land title to multiple - typically controlled - entities, or to friends/relatives/business associates, each having P.O. Box addresses, addresses in far away places, etc. before a bankster files a foreclosure action, for the purpose of creating difficulty for a process server to serve a foreclosure lawsuit in a judicial foreclosure state. Note that if you use addresses that are located outside of the United States, for example, Canada, Jamaica, the Bahamas, Haiti, Central/South America, or any other continent, service of process may need to comply with the laws of that foreign jurisdiction, the Hague Service Convention, and/or possibly the Inter-American Service Convention and Additional Protocol. See generally,  American Bar Association Newsletter (October, 1999): Service of Process Abroad; U.S. State Department: Service of Legal Documents Abroad. What a cruel joke to play on the poor process server!

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