Property Records Industry Association
Land Fraud: Bandits, Desperados and Other Bad Actors Cracker Cow Hunter Garb John L. Jones Arion Zoe Corp. MACR Conference June 14, 2007
Property Records Industry Association • www.pria.us
What is Land fraud? Types of Mortgage Fraud
An intentional misrepresentation of material existing Fraud for Property fact made by one person to another with knowledge of its falsity and for the purpose of inducing the other person to act, and upon which the other person relies Fraud for Money with resulting injury or damage.
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
Fraud for Property Fraud for Money
Forgeries Who - buyers/owners Who - Desperate People, Insiders; Crime False Impersonations What – Lies, misleading statements, Gangs; Militias Embezzlement
false information etc. Racketeering What – Lies, misleading Why – to obtain property statements, false Cons & Scams information PLUS ... Wire and Mail Fraud Effects – None unless they can't pay Check Fraud
back the loan, then default & are Perjury foreclosed
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
1 Fraud for Money (cont'd) Stories
Why – to get money or to Ruins reputations of The Bandit use property in another innocent people money-making enterprise Increases taxes for Desperados neighborhing owners Effects – Bad Actors May decrease value of Clouds title of legitimate neighboring properties owners for resale
Takes property from legal Costs victims money to owners clear names, pay claims
Steals money from May leave innocent lenders employees out of work
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
tampabay.com The Bandit - Matthew Cox For sure, a No. 1 we don't want
By Robert Trigaux, Times Business Editor Published May 21, 2007 "If mortgage fraud were an automobile race, the 2006 figures show Florida, California and Michigan as leading the race." Mortgage Asset Research Institute
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
tampabay.com Desperados - Fraud leader had a lot of help The Erpenbeck Co. & Peoples Bank, et al.
Matthew B. Cox had 22 co-conspirators in his The mortgage schemes, new charges say. Erpenbecks
$8.6-million in fraud on transactions involving 77 properties in the Tampa Bill
$2.35-million in fraud on 22 properties in Nashville Tony Facing as many as 422 years in prison
"With Cox, it was not about making money. It was the thrill of the bluff and getting away with it."
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
2 Erpenbeck leaves trail of Building giant falls in scandal abandonment
At The Fairways at Wetherington “The April 2002 collapse of the Erpenbeck condominium project in West Chester Co. caused financial havoc for area At Steeplechase in Union homebuyers, subcontractors and banks.” At Chestnut Park in Miami Heights
The Lofts of Wetherington in West Chester
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
Erpenbeck: Scores of liens Bank One adds to company filed on homes woes
“The nation's sixth-largest bank, Bank One, has joined “Scores of people who bought new homes the list of those suing home builder Erpenbeck Co. from Crestview Hills builder A. William with $9.8 million in foreclosure lawsuits...”
'Bill' Erpenbeck are being dragged into “Thirty-seven representatives of Tristate banks and legal entanglements over payment title companies crammed into a law firm conference claims held by subcontractors, banks and room Thursday to begin assessing damage from the Erpenbeck Co. troubles and to determine how any local governments.” losses will be absorbed.”
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
3rd-party checks examined Erpenbeck Partied While in Erpenbeck probe Company Imploded
“Like a fraternity house president, Bill Erpenbeck took it upon “The Erpenbeck Co. used Peoples Bank of himself to entertain his employees, whether it was taking Northern Kentucky to redeem $15 million in 150 staffers and guests on the company's annual Caribbean checks made out to other financial institutions for cruise, letting them use the tanning bed in his Crestview new home purchases, a Peoples director said Hills mansion or letting them take the company plane to the Friday.” company condo in Myrtle Beach, S.C. But as the Erpenbeck brass enjoyed the high life, the company was in serious trouble.”
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
3 Ex-banker denies fraud role Regulator: Peoples fraud worst
“Kentucky's top banking regulator says the “A year after being ousted from his job, Erpenbeck-Peoples Bank of Northern Kentucky former Peoples Bank of Northern Kentucky president John Finnan says in loan fiasco that ensnared about 20 financial a new court filing that he did not take institutions in the Bluegrass State could be the part in home builder Bill Erpenbeck's biggest case of bank fraud in the $33 million bank-fraud scheme...” commonwealth's history.”
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
Erpenbeck admits to bank fraud Judge approves Erpenbeck deal
“Addressing 30 lawyers huddled in a semicircle before his bench, Boone County Circuit Judge Jay Bamberger eased “Former Northern Kentucky home builder Bill the pain of 210 Erpenbeck Co. home buyers Friday by ratifying a settlement that clears the way.... Erpenbeck pleaded guilty Wednesday (April 10, 2003) to a single count of federal bank fraud after
The hour-long hearing was the culmination of six months of agreeing to a plea deal that calls for him to help legal wrangling among the home buyers, Peoples Bank of convict accomplices and repay at least $27 million Northern Kentucky and dozens of banks and title insurance in damages - then spend up to 30 years in prison.” companies with competing claims. The case only involved ￭ people who had paid for their Erpenbeck homes with checks.”
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
Bad Actors Land Fraud & Recorders?
Identity Theft Ownership Data to Discover Owner and Lender Names
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
4 Land Fraud & Recorders? (cont'd) Land Fraud & Recorders? (cont'd)
Identity Theft Ownership Data to Property Assessors
Land Record Information To Steal Personal Discover Owner are the best choice Information e.g., SSNs, CCs, etc. and Lender Names because they have:
Practical Obscurity Map-based Recorders are Little or no evidence of identity theft generally a poor Ownership Info Property Assessors are a better source of this choice – except in Property Values MN Legal Descriptions
Addresses
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
Land Fraud & Recorders? (cont'd) PRIA Land Fraud Committee
Fraud has occurred before the recorder White Paper sees the documentation Draft Legislation
Recorders cannot prevent nor deter land Awareness fraud, at best you can
assist in detection
make access to personal information marginally more obscure
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
(Cont'd) (cont'd) PRIA Land Fraud Committee PRIA Land Fraud Committee
White Paper: Collecting stories Draft Legislation Identifies 5 areas - A “How To” A possibility ala' DD214s and 1st Page Indexing for proactive Fraud Starter Kit action... Nothing is being contemplated now Awareness Prevention PRIA Annual Conference – July 21-24 Deterrence Land Fraud Presentation, Sunday 3:45–5:00 p.m. Detection Land Fraud Working Session, Monday 8:30-10:15 a.m Correction
Prosecution Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
5 Summary Questions?
Fraud for Property & Money Money is worst in $ costs Fraud's effect on Recorders = PRIA Land Fraud Committee White Paper ??? ??? draft and possible Draft Legislation
Property Records Industry Association • www.pria.us Property Records Industry Association • www.pria.us
Property Records Industry Association That Ol' Red, White & Blue Land Fraud Bandits, Desperados and Other Bad Actors
John L. Jones Cowboy Poet Arion Zoe Corp. 813.254.0055 [email protected]
Property Records Industry Association • www.pria.us
6