Consumers Warned of Forged and Fraudulent Property Deeds

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The California Department of Real Estate (DRE) issued a Consumer Alert last week about the growing number of scams that involve forged or fraudulent property deeds and what consumers can do to protect themselves against such fraud. The DRE is a state department whose mission is to protect the public interests in real estate

SACRAMENTO, Calif.–The California Department of Real Estate (DRE) issued a Consumer Alert last week about the growing number of scams that involve forged or fraudulent property deeds and what consumers can do to protect themselves against such fraud. The DRE is a state department whose mission is to protect the public interests in real estate matters.

"In the current economic climate, criminal fraud related to real property deeds is on the rise and homeowners should be on the lookout for red flags to ensure the title to their property is protected," stated Barbara Bigby, Acting Real Estate Commissioner.

The department issued the alert to educate the public about the document recordation process, highlight some of the different types of deed scams which are being perpetrated against property owners, and to provide a checklist of warning signs that suggest or signify fraud. The Alert also informs victims of actions they can take, including what steps are necessary to rectify "clouded" ownership records.

The warning signs of deed fraud include:

• You stop receiving your property tax bill or notices.
• You receive a Notice of Default or Notice of Trustee’s Sale when you own your home outright, or when you have a mortgage and you are not delinquent on your loan payments.
• You receive loan documents in the mail for a loan or transaction that you have no knowledge of.
• You learn of a recorded document on your property where ownership in your property, or a portion thereof, was transferred or sold to another party without your knowledge.
• You learn of a recorded document on your property where the signer of the document was deceased at the time of execution of the document.
• Changes or alterations were made to a recorded document after you signed it.

The key to stopping these kinds of scams is to immediately act on any suspicious activity. Initial steps a homeowner should take immediately include:

• Contact the County Recorder's Office and let them know of the fraud.
• Report the activity to local law enforcement. Many counties now have real estate fraud divisions within the office of the District Attorney.
• Most recorded documents require a notarized signature and as such, a complaint should be filed with the California Secretary of State, Notary Public Section, if you suspect a forged signature on a notarized document.
• Contact your title insurance company to determine if forged deeds are covered under your title insurance policy.
• File a complaint with the DRE if you suspect that a real estate broker or salesperson, or unlicensed person purporting to be a real estate licensee, is involved in the forging of any deed or fraudulent recording of a false, fictitious, or forged deed.
• Consult with a licensed and knowledgeable California attorney. Bogus deeds may be void or annulled.
• To obtain a copy of the Alert and to learn more about the DRE and its program areas, visit www.dre.ca.gov.

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