Life In Wake Forest NC.....

Real Estate Fraud Schemes –Part 1 of 8 for Agents, Buyers & Sellers

Real estate agents and other real estate professionals may not realize that their transaction is a fraud scheme. I recently compiled the most common types of fraud from the FBI and IRS to create this blog series.  During the making of this blog series I have noticed that many of these schemes include inflated appraisals.  Although I dislike HVCC I am beginning to understand why it was implemented so forcefully. I hope you learn as much as I have and that this series proves useful in helping you identify fraudulent transactions before they happen.

Part 1 - Is your transaction a real estate fraud scheme?

Part 2 - Mortgage & real estate fraud categories

Part 3 - Short sale schemes

Part 4 - Credit enhancement schemes

Part 5 - Builder bailout-condo conversion schemes

Part 6 - Foreclosure rescue-bankruptcy schemes

Part 7 - Reverse mortgage schemes

Part 8 - Agencies that report mortgage & real estate fraud

Florida Businessman Sentenced to 10 Years in Prison in Real Estate Fraud Scheme

On September 16, 2009, in Fort Myers, Fla., Samir Nel Cabrera was sentenced to 120 months in prison, to be followed by three years of supervised release, and ordered to pay an $1,100 special assessment; the amount of restitution will be determined at a later date.  In addition, Cabrera was ordered to forfeit $75,500 in assets.  Cabrera was indicted in August 2008 and charged with perpetrating an investment fraud involving undisclosed transfers or “flips” of real property and same-day closings. 
According to court documents, STR & Associates, LLC, a Florida limited liability company controlled by Cabrera, purchased two parcels of undeveloped real property and then flipped the properties on the same days by selling them to real estate investment limited liability companies also controlled by Cabrera and funded by investors. The proceeds created by the flips were approximately $2.8 million, almost all of which Cabrera misappropriated.  The misappropriated funds were from individuals who invested in Cabrera's real estate limited liability companies.

Source: mortgage fraud blog

One example of why HVCC was implemented

FBI Statistics

Financial Institution Reporting of Mortgage Fraud Increases
Suspicious Activity Reports (SARs) from financial institutions indicate an increase in mortgage fraud reporting.  There were 63,713 mortgage fraud related SARs filed with FinCEN in FY2008, a 36-percent increase from FY2007.  Preliminary statistics indicate SAR filings in FY2009 will exceed 70,000 (see Figure)

Information for this series was gathered from mortgage fraud blog, the FBI 2008 fraud report and the IRS.

Home loans since 1977

  First Priority Financial is licensed by the California DRE # 654852  Nevin's California DRE license 016552

  The opinions expressed in this blog are not necessarily those of First Priority Financial.

3700 Hillborn Rd #700, Fairfield, California 94534.   This is not a guarantee to lend.