Real Estate Articles

Home : Publications : Real Estate Articles

REALTOR®: Real estate fraud increasing in San Mateo County

D.A. official asks Realtors to be alert and report incidents quickly

Monday, August 6, 2007

Real estate fraud is on the rise; the numbers are so alarming that Russ Banks, an investigator with the San Mateo County District Attorney office, wants San Mateo County Realtors and affiliates to be on the alert, to check out suspicious incidents, and report them quickly.

Banks was a guest speaker at a recent San Mateo County Association of REALTORS® (SAMCAR) Realtor tour meeting, and told SAMCAR members the D.A.’s office is facing enormous challenges as violations in the real estate industry increase. The office used to receive one to two complaints every six months; today, the office receives three to four complaints a week.

“Because of the influx of specific complaints, we are putting an emphasis on fraud,” said Banks. “The little practices that were all right two to three years ago - those days are gone. Scrutiny is at a much higher level today. The things that were can’t be the way they are now.”

Types of fraud being committed range from equity fraud to mortgage fraud, renter’s fraud, appraisal fraud. Cases include embezzlement involving escrow deposits of money in transactions and access to trust accounts, false employment records, inflated accounts, unlicensed agents, recording false documents, foreclosure rescue scams in the form of fake bailouts, the old-time “bait and switch,” where sellers believe they are refinancing when they are actually selling their home, notary forgery. Elderly financial abuse is also on the rise, as seniors are becoming popular targets of real estate fraud.

Banks told SAMCAR Realtors and affiliates, “If you are dealing with something that doesn’t feel right, it probably isn’t. You need to check it out. A lot more caution and prudence is required in your daily practice. Do not take liberties with the process, and if you see something suspicious, report it right away.”

The D.A. official also advised Realtors to check out all parties involved in a transaction. “These days, it’s most important to know whom you are dealing with. Do a little research and conduct background checks,” he said.

Realtors and affiliates need to be aware of the law, Banks noted, because often, violations occur due to plain old negligence and ignoring red flags. Many cases are criminal violations, and punishable by heavy fines and state imprisonment. In some cases a party can be sued civilly, and then prosecuted criminally, he warned.

To report a suspicious incident or for questions, Banks advised SAMCAR members to contact the office of the San Mateo County District Attorney, the Department of Real Estate, or the Better Business Bureau.

The San Mateo County Association of REALTORS® (SAMCAR) is a professional trade organization representing over 3,800 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula. SAMCAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in San Mateo County.

The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.

Variations of this article have appeared in local area newspapers.

For further information, please contact Julie Ziemelis, Director of Public Affairs, e-mail , or phone (650) 696-8214.

» Back to Real Estate Articles