Real estate fraud to be investigated with transaction fee funding

Danielle Jester

The Siskiyou County District Attorney’s Office will soon begin investigating and prosecuting local cases of real estate fraud, thanks to resolution that was passed with a 4/5 vote by the Siskiyou County Board of Supervisors. No members of the public came forward to comment on the proposed resolution during a public hearing on Aug. 13.

California Government Code section 27388(a) allows the county to charge up to a $10 fee when a real estate document required by law is recorded with the county. Those monies are then collected into a County Real Estate Fraud prosecution trust fund. The DA’s office opted to make that fee $6 per transaction.

At the Aug. 13 meeting, Siskiyou County District Attorney Kirk Andrus said he’s been aware of the real estate fraud prosecution fund option for many years but said his office waited to pursue the avenue until they could determine that the county had the right kind – and in sufficient numbers – to warrant applying an employee to the effort.

Andrus presented a laundry list of fraudulent real estate dealings that his office is and will be able to prosecute. Those include false financial statements, forgery, recording a false or forged document, identity theft, mortgage fraud, grand theft, burglary, diversion of construction funds, residential trespass, renting out somebody’s home without permission, returning to a dwelling after being evicted, multiple sales of the same property, fraudulent conveyances, selling property without a spouse’s consent, offering false evidence, preparing false evidence, misuse of a notary stamp, impersonating a notary, rent skimming, home equity sales contract fraud, mortgage foreclosure consultant fraud, failure to provide notice of loan modification to client, land sale contract fraud and theft from escrow.

He told the supervisors that his office has heard of all kinds of fraud associated with the “land rush” that’s taken place in Siskiyou County in recent years.

“People are buying multiple parcels and they are now put in the name of somebody who doesn’t even exist or put in the name of somebody who didn’t enter into that contract,” Andrus said. “People are trying to obfuscate the ownership because there’s an illegal enterprise happening there. These transactions are still taking place every year in Siskiyou County,” he explained.

“We were required to already have a program to apply for these funds, which we do,” Andrus told the supervisors. He said his office has four such cases “in the pipeline,” some of which will be very time consuming. “It’s going to be very helpful when our new employee comes on board and we’re able to train them using these funds,” he said.

The DA’s office plans to have a committee to look over the use and dispersal of the real estate fraud funds. The committee would include the Siskiyou Association of Realtors, Andrus said, which represents both north and south county.

District 3 Supervisor Michael Kobseff expressed some hesitation about the idea, asking Andrus, “Isn’t there a way to get the funds from the people you’re actually prosecuting, versus the normal law abiding citizen having to pay the way for everybody else?”

Andrus reasoned, “The normal, law abiding citizens are the ones who’ve been reporting these things to us and really deserve a higher level of service than we’ve been able to provide.”

He added that the fee will pay off for local citizens because the DA’s office will be empowered to remedy some major issues afflicting those citizens. He also explained that “the criminal justice system has never been a very efficient way to collect money” and to the extent that it does, the funds don’t typically go toward law enforcement or DA’s offices.

Asked if the Siskiyou Association of Realtors supports the fee, Andrus said anecdotally, yes – the realtors he’s spoken with are in support. He said he had not made a formal presentation to the association but would soon be doing so.

“I would feel a little better if they supported this,” Kobseff said, noting that he would like to see a formal letter of support for the effort from the Siskiyou Association of Realtors. He told Andrus that he was going to abstain from voting on the resolution, also noting his concern that county citizens would only be made aware of the fee once they went to record a real estate transaction at the assessor/recorder’s office and might then make frustrated calls to the board of supervisors.

The resolution to institute the $6 fee passed, with four of the five supervisors (Ed Valenzuela, Lisa Nixon, Brandon Criss and Ray Haupt) voting in favor, and Kobseff abstaining.