San Francisco Police Department

Real Estate Fraud Prosecution Trust Fund

May 10, 2006

Report to The Real Estate Prosecution Trust Fund Committee
Edwin M. Lee, City Administrator
David Carillo, for the City Attorney
Michael A. Troncoso, for the District Attorney

This report covers the use of the Real Estate Prosecution Trust Fund monies for the time frame 04/30/2004 to 04/30/2006, including fiscal years 2004-2005 and 2005-2006 by the San Francisco Police Department Fraud Detail. This report presents an accounting of funds received and expended during the period and also provides a brief synopsis of each real estate case assigned for investigation.

____________________________________
Acting Lieutenant Gregory Ovanessian
San Francisco Police Department
Fraud Detail
(415) 553-1550 Office
(415) 553-9526 (Fax)

The Real Estate Fraud Prosecution Fund was established by California Government Code Section 27388. This code gives the respective counties of California the option of placing a fee upon the recording of certain Real Estate transactions. These fees, after the deduction of administrative costs incurred by the county, are to be used solely for the deterrence, investigation and prosecution of real estate fraud crimes. In the City and County of San Francisco, 10% percent of all fees collected go to the Assessor's Office for the costs of administering this fund, 54% to the District Attorney's Office and 36% to the San Francisco Police Department.

The following list gives a brief description of the various real estate fraud cases assigned to the Fraud Detail. These cases were either previously assigned prior to April 2004 or assigned during the reporting period April 2004 -April 2006 for investigation. For this period we have received seventy-one (71) cases with a combined reported loss of approximately $31,814,720.00. Due to the complexity of these cases and the fact that investigations from other agencies are often necessary (Adult Protective Services and outside Jurisdiction referrals) many of these cases are still being actively investigated with a final determination on each case to be made by the District Attorney's Office.

The most recent case criminally charged involved a suspect who was victim's caretaker and besides physically abusing victim stole $8,000 cash from victim. Suspect also fraudulently obtained title of victim's deceased sister's residence valued at $500,000.00. The use of the real estate trust fund allowed the inspector assigned this case to begin an immediate investigation that resulted in a warrant being issued for suspects' arrest. Suspect was located in Texas and arrested and then extradited from Texas to California for trail. Case scheduled for jury trial, but suspect pleads guilty to twelve (12) fraud related counts in this case in Superior Court Department #27 on 10/25/2005. Suspect was sentenced to three- (3) year's state prison and $50,000 restitution to victim's estate on 12/07/2005.

Another recently assigned case in 2006 involves a loss of $1 Million in an investment scam. Victim tricked into investing by two suspects over eight-(8) year period. Victim took various loans out on his residence, also took out lines of credit loans and was refinancing loans during this 8-year period. Last loan victim obtained on his residence was on Jan 2006 for $1.3 million.

 

While the main use of the Real Estate Trust Funds continues to be for the investigation of criminal complaints, the Fraud Detail has also used the monies to send its members to real estate training and to purchase equipment related to the investigation of real estate cases. A complete accounting of all real estate monies from inception of fund is maintained in the Fraud Detail and is available for review at any time to the members of the Committee.

In addition to the criminal investigations, personnel from the Fraud Detail have attended many community meetings and numerous undue influence workshops where the topic of real estate fraud was discussed. A program for station roll call training has been started along with a detailed brochure on real estate fraud that will be given to patrol personnel.

The following pages will detail the budget for fiscal year 2006-2007 and will show actual revenue and expenses for the complete fiscal year 2004-2005 and a partial accounting for fiscal year 2005-2006. Also shown are the relevant governmental codes authorizing the use of this fund.

010374732 Reassigned Case---Real estate matter - financial elder abuse. Suspect fraudulently obtained victim property valued at $180,000.

Loss $180,000

021279709 Victim Mary Robinson Real Estate Fraud Case

Loss $165,000

030025971 Reassigned case. Allegedly suspects obtain $95,000 loan on mother's home and steals money.

Loss $95,000

030080925 Reassigned Case. Suspect allegedly fraudulently transfers five (5) properties in living trusts to other trusts.

Loss $1.75 Million

030234229 Suspect obtains fraudulent loan for $850,000 against victim's property in SF.

Loss $850,000

030349997 Victim alleges that suspect misappropriated $100,000 funds from real estate deal.

Loss $100,000

030651833 Suspect allegedly obtained equity Real Estate loan against victim's home for $200,000.

Loss $200,000

030736742 Victim lent $800,000 to suspect for real estate

development. Suspect never repaid loan.

Loss $800,000

030949127 Suspect obtains an equity line of credit on victim's home for $200,000.

Loss $200,000

030981696 Victim invests $180,000 in Real Estate Property Investment Scam.

Loss $180,000

031070688 Conservator of victim alleges that victim's caretaker stole victims' deceased sister's house valued at $600,000.

Loss $600,000.

031229023 Case Reassignment suspect fraudulently misuses victim's credit card accounts. Also, suspect fraudulently obtains loan on victims' property of $100,000.

Loss $100,000

31222964 Reassigned Case. Mentally handicapped adult scammed in real estate scheme by suspect. Tenant (Suspect) has victim via undue influence sell a rental unit at half market value to suspect. Suspect then gets $400,000 loan on property.

Total Loss $630,000

031352618 Suspect has victim impersonated to obtain equity line of credit on victim's residence.

Loss $350,000

031415454 Suspect deposited a Real Estate Escrow check for $488,347 into her personal account.

Loss $488,347

031436858 Elderly Victims of Real Estate home repair scam paid suspects $24,356 for alleged repairs to residence.

Loss $24,356

040081509 Conservator alleges suspect fraudulently withdrew $570,000 funds from victims' accounts. Additionally suspect sold Real Estate belonging to victim for $500,000 to suspect's friends' husband. This sale price was well below property's fair market value of $850,000.

Total loss $1.42 Million

040137481 Allegation that Caregiver using undue influence gets ownership of victims' residence and attempting to sells same. Suspect obtained loan on property for $162,000.

Loss $162,000

040195724 Suspect acquaintance of victim scammed house from victim valued at $500,000.

Loss $500,000

040199920 Suspect via undue influence on elder, unlawfully occupies an apartment belonging to victim and then subletting to various renters collecting rents due victim over 26-month period.

Loss $27,000

040223472 Suspect befriends and marrys vulnerable women. Victim recently sold her home and allegation theft sales $2,400,000 proceeds by suspect.

Alleged Loss $2.4 Million

 

040263898 Allegation of illegal eviction and theft property from rent controlled apartment. Elder victim in rent controlled apartment paying $393 a month. Management Group of victim's apartment removed all Victim's property while she was in hospital and painting & repairing apartment in preparation to rent out apartment to another at higher rent of $1,200 a month.

Loss: N/A

040322159 Victim had ownership in real estate transferred without consent valued at $450,000.

Loss $450,000

040350097 Suspect scammed $10,000 from victim in bogus real estate investment scheme.

Loss $10,000

040595685 Victim advised by collection notice from IRS someone had stolen his Identity and via impersonation obtained a HUD/FHA loan in amount of $95,853 to purchase property at 4201 Iowa Avenue, Sacramento, California.

Loss $95,853

040660147 Allegation that caretaker of victim swindled money from victim's trust/estate/securities/bank accounts and various Real Estate transactions including mortgages & lines of credit amounting to allegedly $2,000,000 on property in SF and other jurisdictions.

Alleged loss $2 Million

040710225 Suspect obtains second mortgage loan for $50,000 on victim's property without permission or authorization.

Loss $50,000

040796372 Reportee accuses suspect of using undue influence to obtain property of victim.

Loss $300,000

040918980 Suspect obtains real Estate loan on property $6,000.

Loss $6,000

040950261 Suspect (husband) forges victim's (wife) signature to obtain equity line of credit for $125,000 on home.

Loss $125,000

041139042 Caretaker fraudulently attempts to obtain victim's real estate property.

Loss $400,000

041195351 Caretaker undue influence financial abuse case. Suspects obtains $125,000 loan from elder secured by only promissory note and had victim write additional check to suspect for $130,000.

Loss $255,000

041200386 Suspect moves into Elder victim's residence as tenant. Suspect takes over elder's residence without permission and authority valued at $650,000 and refuses to leave victim's residence claiming victim agreed to sale residence to suspect.

Loss $650,000

041220873 Suspect attempts to have elderly victim sign away rights to deceased sister's Chicago, IL property valued at $600,000.

Alleged Loss property in Chicago, IL valued at $600,000

041227512 Elder victim is exploited by Mortgage broker and allegedly is victim of predatory lending.

Loss $25,000

041228924 Suspect obtains fraudulent equity line of credit for $40,000 using victim's residence.

Loss $40,000

041258307 Allegation/dispute between parties to family trust including real-estate properties one located at 1832 Keith St, SF, CA. Allegation is that suspect steals residence of deceased valued at $600,000

Loss $600,000

041316375 Suspect illegally collects Real Estate Rents due to victim while he is prison.

Loss $50,000

041337581 Suspect opened home equity loan using victim's name for $250,000.

Loss $250,000

041397494 Suspect a son of victim tricked victim into signing a power of attorney document. Suspect son used Power of Attorney to evict another son from victims' residence. Allegation suspect then attempted to sell San Francisco residence of victim valued at $800,000 and move victim to Florida location.

Alleged loss $800,000

41398919 Originally assigned as Embezzlement Case of $207,000. Investigation revealed several real estate transactions during 4-year period of theft involving money embezzled.

Loss $207,000

050056263 Victim attempting to get $300,000 on Real Estate since 1994.

Loss $300,000

050095283 Suspect took $325,000 from a Real Estate Management Companies account.

Loss $325,000

050108256 Victim hired contractor to repair roof on his residence for $8,000---- a home repair theft scheme.

Loss $8,000

050131702 Fraudulent line of credit taken out on residence of victim for $100,000

Loss $100,000

0501562973 Assigned 02/14/05 as embezzlement Case. Investigation revealed suspect and victim were involved in a real estate project together. Dispute over $126,164.

Loss $126,164

050225399 Suspect allegedly obtaining mortgages and checking and credit card accounts in victim's name. Multiple mortgage loans for $98,126.15, $55,230, $292,500 and $375,000.

Total mortgage loan loss $677,500

050316330 Suspect caring for elder under questionable living conditions and handling her financial funds steals victim's residence, rare books and money in excess of $600,000.
Loss $600,000

050387870 Victim alleges that suspect victims husband obtained loan for $42,500 on victim's property in Daly City by forging victim's signature to documents notarized in San Francisco.

Loss $42,500

050432544 Suspect persuades victim to sell him her home for $325,000 value residence $500,000 and victim signs Grant Deed of Trust for Property transferring title to suspect. Suspect never pays victim agreed sale price.

Loss is $325,000.00

050497156 Allegation is that victim is mentally challenged/unstable and is being taken advantaged of by suspects ---including Real Estate transactions victim recently sold set flats for $249,000. Suspects attempting purchase property in Las Vegas, Nevada but in victim's name. Suspects with funds from victim recently purchased an auto.

Loss $249,000

050549870 Suspects via undue influence on victim sells victim's house.

Loss $250,000

050641121 Suspect, daughter of victim, tricks victim into signing document regarding interest between victims children in real estate property in SF---- An apartment building valued at $1,000,000

Loss $1 Million

050758099 Suspect used undo influence to obtain funds from victim in form of a $750,000 loan.

Loss $750,000

050838538 Victim alleged deceased, but living at Laguna Honda Hospital. Suspect (niece of victim) filed for transfer of property victim owned valued at $650,000.

Loss $650,000

050867941 Victim alleges that two suspects tricked her into selling her home for $600,000, which is below the home market value of $800,000.

Loss is $200,000

051003170 Suspect gets victim to sign "Power-of-Attorney" under false pretenses. Suspect then takes out $224,000 loan on victim's residence

Loss $224,000

051038638 Victim in divorce proceedings alleges her husband forged her signature on Grant Deed and husband obtained loan on jointly owned property of $150,000 without her knowledge.

Loss $150,000

051068572 Victim alleges that son forged her signature on Grant Deed transferring ownership on residence to son. Son then obtains $406,000 loan against the home.

Loss $406,000

051173999 Suspect forged signature of victim on Power Of Attorney documents and obtained $50,000.

Loss $50,000

051205025 Suspect filed a fraudulent quitclaim Deed of Trust on victim's house and then fraudulently obtained loan on property.

Loss $70,000

051216652 Victim concerned with a will giving title to her residence valued at $650,000 to another family member.

Loss $650,000

051300948 Victim signs Power of Attorney to suspect. Suspect to over see and fix property valued at 1.3 million in Berkeley, CA. Allegations that suspect spent $100,000 on property for only minor repairs. Also, suspect applied for unauthorized loan on victim's property.

Loss $100,000

051324700 Suspect via undue influence gets victim to pay for religious rituals in amount $20,000. Suspect able to move into elder victim's residence and thereafter attempted to get victim to refinance her home

Loss $20,000

051329669 Suspect obtained loan of $300,000 on victim's property without consent or knowledge of the victim.

Loss $300,000

051340825 Victim alleges that suspect forged mothers signature or unduly influence her to sign an amendment to her will and trust giving suspect full Power-of-Attorney concerning her assets. After mother's death suspect used Power-of-Attorney to immediately sell one property for $699,000. Suspect then attempts to sell another of mother's properties for $1.1 Million.

Total loss $1.799 Million

051411244 Victim alleges suspect representing victim as her real estate agent forged victim's signature on acceptance purchase offer on legal documents concerning purchase real estate valued at 1.6 million.

Loss $57,000

060071477 Victim who hired a suspect from a mortgage company as his real estate broker later allegedly found $2,000,000 stolen by suspect.

Loss $ 2 Million

060090869 Allegedly, suspect who is daughter of victim took out a loan without victims' authorization on residence for $500,000.

Loss $500,000

060177075 Victims property allegedly sold in July 2003 for unknown amount money to other persons by real estate agent without her knowledge and/or authorization in alleged real estate transaction. Victims' house valued at $750,000.

Loss $750,000

060122036 Victim tricked into investment scam by two suspects over long period of time. Over an 8-year time span victim takes out new first loans, lines of credit loans and also he refinanced loans on his residence. Allegedly, a $1 million loss due to investment scams. Last loan on residence obtained by victim on Jan 2006 for $1.3 Million.

Loss $1 million

 

         
         
         
         

Real Estate Fund Expenses for Fiscal Year 2005-2006

         
         

Overtime

       

Based on 838.5 hours OT (as of 4/30/06)

 

(@$75.00 per hour)

   

$62,887.50

Bronson (740 hrs @$41.56 per hour)

30,754.40

         
         

Training

       
       

0.00

         
         

Equipment

     
       

0.00

         
         
         
         
         

Total Expenditures for FY 2005-2006

$93,641.90

 

           
           

Summary of Real Estate Fund since inception 9/2001

 
           
           

Initial Deposit

   

$0.00

 
           

Total Inflows 2001-02

 

70,836.00

   

Total Expenses 2001-02

(18,345.62)

   
           

Net operating excess

   

52,490.38

 
           

Beg Balance 7/1/02

   

52,490.38

 
           

Total Inflows 2002-03

 

119,377.72

   

Total Expenses 2002-03

(41,863.48)

   
           

Net operating excess

   

77,514.24

 
           

Beg Balance 7/1/03

   

130,004.62

 
           

Total Inflows 2003-04

 

118,703.08

   

Total Expenses 2003-04

(43,517.38)

   
           

Net operating excess

   

75,185.70

 
           

Balance as of 7/1/04

   

205,190.32

 
           

Inflows 2004-05

 

87,254.64

   

Expenses 2004-05

 

(81,966.43)

   
           

Operating excess

   

5,288.21

 
           

Balance as of 7/1/05

   

210,478.53

 
           

Inflows

   

71,431.72

   

Expenses

   

(93,641.90)

   
           

Operating excess

   

-22,210.18

 
           

Balance as of 4/30/06

 

$188,268.35