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Wednesday, April 30, 2008


You know it had to happen, with all the problems in the housing industry. People are desperate and will do anything to save the roof over their heads. Including placing their confidence in the hands of con artists who claim to have a way to save the homestead, but really plan to sell it right out from under you. According to the Boston Herald, “house stealing,” as it is now referred to, combines identity theft and mortgage fraud that could leave you walking the streets.

In an article from NetworkWorld, they actually outline the scam, as follows: 1) the crooks decide to steal your house; 2) next, they heist your identity, readily available in public records and on the Internet; 3) forms are purchased from an office supply store to transfer your property; 4) By forging your signature, your house becomes theirs to sell. If it’s not your regular residence, it could be an empty house, vacation home, or second home like a summer place on Cape Cod. A ConsumerAffairs site adds a fifth step, one where the homeowner loses everything: “Once those papers are filed, the deed to the house transfers to the con artists. And the home belongs to them.”

A trio of thieves including a man and two women stole the identity of 65 year old Judy Melody in Dorchester, Massachusetts, then they attempted to buy two homes in Brockton and Halifax. They were finally caught when trying to sell Melody’s home. This seems almost as bizarre as yesterday’s post on “The Great Impostor of Identity Theft.” According to the FBI, there were 46,717 incidents of mortgage fraud in 2007, but there have already been 30,000 so far in 2008, an escalation which seems to mirror the general trend in ID theft.

The FBI reports in the Boston Herald that the schemes are most prevalent in real estate boom states like Florida and Nevada, but Massachusetts gets its share where Wells Fargo and four other lenders agreed to pay $1 million to victims of a foreclosure-rescue scam. The agency says that “Thieves are preying on people not paying attention to their financial statements.” If homeowners were given control over their names and personal data, much of this problem could be solved through transaction verification that would at least alert the victim to what is taking place.

In a case the FBI and IRS investigated last year, homeowners were targeted who were in foreclosure with a promise to refinance loans. Los Angeles real estate agent Martha Rodriquez used “straw buyers,” individuals who are paid for the illegal use of their personal information, to file fraudulent documents to buy 100 homes, making $12 million dollars in the deal. Rodriquez was caught and prosecuted, but the owners lost the titles to their homes and banks lost the money loaned to fake buyers.

ConsumerAffairs suggests consumers be aware of all material they receive from their mortgage company that looks suspicious, and periodically check the recorder of deeds to make sure the information is correct. The question is, where will they strike next?

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