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Jergler: Realtors team with D.A. to fight fraud

February 08, 2012|By Don Jergler

Editor's Note: This is the first in a series on the Real Estate Fraud Advisory Board and the Orange County District Attorney's fraud unit.

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If you're in real estate and you're in Elizabeth Henderson's sites, you are probably on the wrong side of the law and you should know there's a whole community of real estate experts helping her try to catch and punish you.

Henderson, an assistant district attorney and head of the major fraud unit in the Orange County District Attorney's office, has behind her the Real Estate Fraud Advisory Board.

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Henderson and the board meet every three months at the D.A.'s office to talk about new scams that may be going on out there, and how to better catch perpetrators of real estate-related fraud.

The D.A.'s real estate fraud unit, which has two attorneys and three investigators who work full time in the area of real estate fraud, has 37 active cases in which charges have been filed. Since it was launched in 2009, the unit has amassed 49 felony convictions, many of which have received assistance or real estate expertise from the advisory board.

There are roughly 20 people on the board, which is organized by the D.A.'s office.

In the last few years, the board and the unit have been increasingly busy, as the downturn of real estate has "brought a ton of schemes," Henderson said.

Loan modification fraud, and short-sale schemes are chief among the scams they're seeing, she added.

One trend that's becoming more commonplace is flopping. Unlike flipping, flopping is purchasing foreclosed properties at the lowest possible rate, then selling them a higher rate and collecting the difference.

Such sophisticated scams take place in a landscape of growing complexities in the real estate market, as more and more people are forced to look at loan modifications, short sales and other means to stave off foreclosures. That's where the expertise of the advisory board, also referred to as a "task force," comes in, Henderson said.

"The task force has been really good," she said, adding, "We're not real estate experts."

Beside Realtors, the task force has mortgage professionals, and professionals who specialize in helping out distressed homeowners as advisors.

"They give us input as to what the issues are that are facing them in the real estate community," Henderson said. "They're kind of our eyes and ears on the street."

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