An increase in real estate fraud cases involving vacant land in South Lake Tahoe, Georgetown, Placerville and Grizzly Flat, as well as cases involving single family homes in the county and in one instance the IP address of the perpetrator was traced to Panama, have prompted El Dorado County Recorder-Clerk Janelle Horne and District Attorney Vern Pierson to raise awareness on this issue.

The duo is sending information to local real estate and title and escrow companies and out to the public with goal of safeguarding local property owners.

Seven cases have been reported to the Recorder Clerk’s Office in the last 45 days and Horne told the Mountain Democrat she thinks there may be more as only around 10% of deed crimes get reported. Properties most likely to be targeted are ones without encumbrances such as deeds of trust, mortgages or liens. A scam artist will pose as a property owner and often contact a Realtor in neighboring county to list a property. Horne said the Recorder’s Office is obligated to record documents they receive but suspicious documents are forwarded to the District Attorney’s Office. 

Imposters are using artificial intelligence to create false IDs and AI-generated photos and videos. Horne showed the Mountain Democrat two driver’s licenses from Nevada and a video purportedly of a homeowner “to show proof of life” that were recently used to commit fraud.

“Once a title is changed the scammer will apply for a mortgage for 80% of the value of the property,” Horne said.

She and the DA recommend that neighbors look out for each other.

“If you see a for sale sign on a property, inquire about it with the homeowner,” Horne advised.

The recorder-clerk recently gave a presentation to the South Lake Tahoe Chamber of Commerce where she urged real estate agents to “ask as many questions as you can about the property and go see with your own eyes to verify.” 

“Our local title companies are really good,” Horne added. “If they feel it is fraudulent, something isn’t right, they’ll send out a letter to the property owner of record basically saying, ‘You’ve opened an escrow. If you have any questions or concerns, please contact us.'”

This tactic has been able to stop some scams from going through. “I believe that listing agreements have to have some type of ID requirement like ID.me, a list of questions whose answers only you would know — what we do for our vital records,” she added. “I think the law should be changed to include ID verification for property listings.” 

Currently there is a flaw in real estate contracts, she maintained, as proof of identity is only required at escrow. 

Some property owners have asked the Recorder Clerk’s office if they should purchase title lock protection. Horne explained that a title lock company purchases the county’s images and index on a monthly basis for its database and is then notified if a transaction takes place.

“It’s not a preventative measure and I think it is being misrepresented,” she said. “El Dorado County property owners can go on our website 24 hours a day and put in their legal name as it is listed on their property and the website will show everything that has ever been in your name.”

Horne and her assistant Catrina Christensen support bill SB 255 in the state Legislature which, if passed, would require county clerk recorders to send notifications of all documents, including deeds of trust, liens and quitclaim deeds to property owners.

The Recorder-Clerk’s Office has already implemented a “Do Not Sell” list in which a property owner registers the parcel number and information on how owners are listed on the title, their phone number and their e-mail address. This list is available to Realtors as well as title and escrow companies, Realtors check it when a client contacts them to list a property. Realtors need to sign up with the office and verify their license before they can access the list. This information allows them to match the phone numbers and email address of the owner with the caller wanting to list the property. 

Title transfers aren’t the only way a property owner can be defrauded. Horne referenced a recent scam involving people who lost their homes in Grizzly Flat but were offered $500 to $5,000 by a Florida-based real estate company MV Realty to be their “future real estate agent.” The document was a covenant restriction that ran with the land for 40 years. Horne said that if the property owner signed up for this but later decided to cancel, they would be hit with a cancellation fee equivalent to a real estate agent’s commission. Horne said there were 12  property owners in Grizzly Flat who were defrauded and 1,500 total cases in California. Last September California Attorney General Rob Bonta secured a preliminary injunction against MV Realty regarding this practice.

“To the nearly 1,500 California homeowners who were tricked into entering into the unlawful listing agreements with MV Realty, today is a good day,”Bonta states in a news release issued last year. “The court found that we are likely to prevail on our claim that those homeowners were intentionally misled by MV Realty. The court also found that MV Realty’s conduct imposed ‘imminent irreparable harm’ to homeowners. As a result, the company is being ordered to stop violating state law, once again allowing homeowners the freedom to do with their property what they wish. While our legal battle is not yet over, we will continue fighting to hold MV Realty accountable.”

The preliminary injunction required MV Realty to: 

• Remove the liens it has recorded statewide within 30 days of the court’s order, or within five days of notification from a California homeowner, or his or her agent, who needs the termination to be able to move forward with a transaction related to the homeowner’s property. 
• Stop recording new liens. 
• Not enforce, during the pendency of the litigation, the “Homeowner Benefit Agreements” it signed with California homeowners.

Horne’s office is also looking into practices implemented in Platte County, Missouri in which biometrics are used to record a document. She said her office is working on creating a new type of document that gives property owners the option to record themselves and it may offer the option of using facial recognition.