GREFPAC - New York Time GREFPAC NEWS 
Official Publication of the Georgia Real Estate Fraud Prevention and Awareness Coalition, Inc. 
A service to our members, industries and communities.

2011 Issue 3 

                    Happy Independence Day 

"We, therefore, the Representatives of the united

States of America, in General Congress, Assembled, appealing to the Supreme Judge of the world for the rectitude of our intentions, do, in the Name, and by Authority of the good People of these Colonies, solemnly publish and declare, That these United Colonies are, and of Right ought to be Free and Independent States . . ." 

 

 

INSIDE GREFPAC
2011-2012 Board and Officers Elected

Pursuant to an election by the membership at the general meeting on June 1, 2011, the 2011-2012 GREFPAC officers and directors are as follows:

Officers:
President:  Tom Merkel, Non-Profit Organization
Vice President:  Michelle Canter, Attorney
Secretary/Treasurer:  Kelli Hutchinson, Mortgage Lending

Directors:
Brent Brewer, Community (returning)
Lisa Brown, Title Insurance (returning)
Pamela Dabbs, Consulting/Education
Ronald Heckman, Appraisals (returning)
Tim Huhn, Fraud Investigation
Sue Hunt, Non-Profit Organization (returning)
Scott Kelly, Mortgage Insurance (returning)
Myra Lewis Williams, Real Estate Sales
Annette McBrayer, Attorney
Kevin Pezzani, Mortgage Lending
Michael Pierce, Attorney (returning)
Matt Wade, Community (returning)

Immediate Past President:  Vicky Thompson, Appraisals

 

Short Sale Fraud Explored at June Meeting 

 

Edward Gerding II, Fraud Consultant at CoreLogic, was the speaker for GREFPAC's June 1 quarterly education meeting.  His presentation on short sale fraud trends and risk mitigation opportunities provided highly relevant and timely information to those in attendance.  GREFPAC extends its sincere thanks to Mr. Gerding.  See the article below for more on CoreLogic's 2011 Short Sale Research Study.
 
GEORGIA NEWS
Woman Indicted on Charges of Stealing Houses
WSB-TV | June 23, 2011

WSB-TV report:  A Cobb County woman who showed how she canceled her own mortgage to avoid foreclosure has now been indicted for racketeering and theft.  Read More

 

Convictions Upheld in "Massive" Mortgage Fraud Scheme
The Atlanta Journal-Constitution | June 14, 2011

The federal appeals court upheld the convictions and 28-year prison sentence against Atlanta real estate developer Phillip Hill, who prosecutors said oversaw a massive mortgage fraud scheme.  The court also upheld all the convictions and sentences against eight of Hill's associates -- brokers, lawyers and recruiters. It declined, however, to uphold the convictions against Hill's right-hand man, Les Rector, and ordered a new hearing on his claims.  Read More

 

Legislative Update


The following legislation of interest did not pass during the Georgia General Assembly's 2011 legislative session but is available for consideration during the 2012 session: 

 

House Bill 110:  "A BILL to be entitled an Act to amend Article 1 of Chapter 14 of Title 44 of the Official Code of Georgia Annotated, relating generally to mortgages, conveyances to secure debt, and liens, so as to provide for a vacant real property registry; to provide for definitions; to provide for required elements of a form for such registration; to provide for exemptions from registration; to provide for maximum fees and penalties for registration and failure to register; to provide for appellate rights; to provide for related matters; to repeal conflicting laws; and for other purposes." Read More

 

House Bill 204:  "A BILL to be entitled an Act to create the 'Protecting Georgia Homeowners Act of 2011'; to amend Article 7 of Chapter 14 of Title 44 of the Official Code of Georgia Annotated, relating to foreclosure, so as to provide for legislative findings and intent; to provide for homeowner relief from unfair practices related to foreclosure and foreclosure rescue schemes; to provide for monetary penalties; to provide for related matters; to provide for an effective date and applicability; to repeal conflicting laws; and for other purposes." Read More  

 

House Bill 237: "A BILL to be entitled an Act to amend Article 5 of Chapter 8 of Title 16 of the Official Code of Georgia Annotated, relating to residential mortgage fraud, so as revise the definition of 'mortgage lending process'; to change provisions relating to the offense of mortgage fraud; to provide for investigative and subpoena powers of district attorneys and the Attorney General relative to residential mortgage fraud; to provide for related matters; to repeal conflicting laws; and for other purposes." Read More
  
House Bill 447:  "A Bill to amend Part 4 of Article 7 of Chapter 14 of Title 44 of the Official Code of Georgia Annotated, relating to foreclosures on personalty, so as to enact the 'Foreclosure Rescue Fraud Prevention Act'; to provide for definitions; to provide for foreclosure rescue consultants and firms to be bonded; to provide for the application of certain state consumer protection laws to foreclosure rescue transactions; to provide that unfair foreclosure rescue transactions are unlawful and void; to provide for remedies; to provide for related matters; to provide for an effective date; to repeal conflicting laws; and for other purposes." Read More

 

Senate Bill 123:  "A BILL to be entitled an Act . . . to amend Title 16 of the Official Code of Georgia Annotated, relating to crimes, so as to change provisions relating to the crime of residential mortgage fraud; to provide for the crime of residential foreclosure fraud and prescribe elements of the crime and penalties; to provide for other matters related to the foregoing; to provide for an effective date and applicability; to repeal conflicting laws; and for other purposes."  Read More 

Former Banker Sentenced to Decade in Federal Prison for Conspiring to Defraud Community Bank & Trust
U.S. Attorney's Office for the N. Dist. of Ga. | May 12, 2011

Jon Rymer, Inspector General, Federal Deposit Insurance Corporation, said of the case,   "The Federal Deposit Insurance Corporation Office of Inspector General is committed to its partnerships with others in the law enforcement community as we jointly pursue bank fraud cases throughout the country.  The American people need to be assured that their government is working to ensure integrity in the financial services industry.  A case like this one--where land flip transactions contributed to multi-million dollar losses to Community Bank and Trust, Cornelia, Georgia -- proves that those engaging in criminal activities that undermine that integrity will be held accountable."  Read More

 

Supreme Court Declines to Review Fraudulent Mortgage Release Ruling
Ga. Supreme Court | Apr. 26, 2011

The Georgia Supreme Court has denied a request to review a decision reported in January by GREFPAC News, whereby the Georgia Court of Appeals concluded that a corporate deed which was executed by someone who fraudulently assumed authority of the company was not a forgery and released the property from the company's security interest as to a subsequent mortgage holder who was a bona fide purchaser for value.  The cite for the Court of Appeals opinion is Deutsche Bank Nat'l Trust Co. v. JP Morgan Chase Bank, N.A., 307 Ga.App. 307 (2010). Read More

Delroy Davy Sentenced to 14 Years in Prison for Defrauding Failed Omni National Bank and Other Lenders
U.S. Attorney's Office for the N. Dist. of Ga. | Apr. 22, 2011

According to United States Attorney Yates, the charges and other information presented in court:  Delroy Oliver Davy formed corporations and companies to purchase properties from financial institutions secured by the Federal Deposit Insurance Corporation, including the now-failed Omni National Bank in Georgia. Davy would "flip" the properties within a short period of time to unqualified "investor" borrowers, at prices inflated by up to $100,000. Davy and his partner would recruit the "investors," and arrange mortgage loans from banks based on false qualifying information, all while concealing from the lenders that his own companies had recently purchased the properties for amounts significantly less than the new loans.  Davy paid kickbacks to a loan officer at Omni, as well as to employees at another lender, who approved funding for his "investors." Ultimately, Davy's scheme forced many properties to go into foreclosure, causing lenders, insurers and others to incur millions of dollars in losses.  Davy also collected money from investors by falsely promising they would receive property, which they never received.  Read More

 

NATIONAL NEWS AFFECTING GEORGIA

FinCEN Attributes Increase in Suspicious Activity Reports Involving Mortgage Fraud to Repurchase Demands
Fin. Crimes Enforcement Network | June 28, 2011

The Financial Crimes Enforcement Network (FinCEN), in its First Quarter 2011 Mortgage Loan Fraud (MLF) analysis, reported that the number of MLF suspicious activity reports (SARs) were up 31 percent from the first quarter of 2010.  FinCEN attributes the increase to large mortgage lenders conducting additional reviews after receiving demands to repurchase poorly performing mortgage loans.  In the first quarter of 2011, 86 percent of MLF SARs reported activities which occurred more than two years prior to the filing of the SARs.  The analysis contains rankings of states, metropolitan areas, and counties based on the number of subjects in 2011 Q1 MLF SARs with suspicious activity dates starting after January 1, 2009.  Georgia, the Atlanta-Sandy Springs-Marietta MSA, Gwinnett County and Fulton County all ranked in the top 20 per capita rankings.  Read More

 

FTC Stops Mortgage Loan Modification Business
Fed. Trade Comm'n | June 21, 2011
  
Under a settlement with the Federal Trade Commission, a federal court banned three men and their company from the mortgage modification business and ordered them to pay nearly $19 million for consumer refunds. The defendants allegedly deceived distressed homeowners with phony claims that they would negotiate with lenders to modify their mortgages and make them more affordable.  Read More

CoreLogic Releases 2011 Short Sale Research Study
CoreLogic | May 25, 2011
 
CoreLogic announced the release of its 2011 Short Sale Research Study, "CoreLogic Analysis on Short Sale Trends, Risks, and Opportunities."  The study was designed to take a rigorously scientific, data-driven look at current trends in short sales and to identify inherent risks and opportunities associated with these transactions.  In it, Georgia is listed as having the seventh-highest volume of single family residence short sales. Read More

HUD Plans to Suspend Regulations Placing Time Restrictions on the Resale of FHA-Insured Property
U.S. Dep't of Hous. and Urban Dev. | May 16, 2011

"This proposed rule would suspend HUD's regulations placing time restriction on the resale of FHA-insured property . . . HUD regulations at 24 CFR 203.37a [currently] provide that FHA, with certain exceptions, will not insure a mortgage if the contract of sale is executed within 90 days of acquisition of the property by the seller.  Section 203.37a was promulgated at a time when the housing market was inflated and consequently property flipping was more prevalent and profitable.  The proposed rule would give HUD the discretion to reactivate the time resale restrictions if HUD determines that activation is necessary to protect the FHA insurance fund and consumers.  HUD determined that the current market has changed to such a degree that the time resale restrictions are currently impractical and impede rehabilitation of foreclosed and abandoned homes.  With the downturn in the housing market, acquisition and resale of properties is an important part of stabilizing the market." Read More

Reported Incidents of Mortgage Fraud Decrease According to LexisNexis Mortgage Asset Research Institute
LexisNexis Mortgage Asset Research Institute | May 9, 2011

Reported incidents of subscriber-verified mortgage fraud and misrepresentation by professionals in the mortgage industry in the U.S. have decreased from 2009 to 2010, according to a new report released by the LexisNexis Mortgage Asset Research Institute.  The decrease in reports is believed to be attributed to several factors, including a decrease in loan origination volumes, fewer resources available to investigate and report incidents and new and stronger Financial Crimes Enforcement Network requirements that encourage professionals to report on suspected fraud.  The report ranks Georgia as having the fourth most serious reported mortgage fraud problem in loans investigated post-funding, during 2010.
Read More

FTC Settlement Collects $2.2 Million, Bans Marketers from Mortgage Relief Business
Fed. Trade Comm'n | Apr. 11, 2011

Under a settlement with the Federal Trade Commission, two companies and three individuals are banned from the mortgage relief services business and must relinquish $2.2 million in assets for consumer refunds. The action is part of the FTC's ongoing effort to stop scams that target financially strapped homeowners seeking mortgage relief. Read More

NOTICE AND DISCLAIMER:
Copyright 2011 Georgia Real Estate Fraud Prevention and Awareness Coalition, Inc. All rights reserved. Unauthorized use of the Georgia Real Estate Fraud Prevention and Awareness Coalition, Inc. or GREFPAC names or logos is prohibited.  You may reproduce a reasonable number of copies of this newsletter for your own personal use or for non-commercial distribution, but all all copies must be unmodified and must include the above copyright notice.  Reproduction or distribution of this newsletter for commercial purposes is prohibited. GREFPAC cannot guarantee that material accessible from this newsletter is free of viruses or other malicious code, and GREFPAC does not accept any responsibility for any loss caused by any such code.  GREFPAC is not responsible for any third party content, products or services that may be accessed through this newsletter, and the availability of links in this newsletter to such third party content, products or services should not be construed as referrals to, or endorsements of, the linked entities or the content, products or services that they make available. GREFPAC will cease providing links from future issues of this newsletter upon request from the linked party.  The information in this newsletter is presented as general information and is not intended to be, and should not be relied upon as, legal advice or legal opinions on specific facts.  You should not rely on information in this newsletter or its applicability to any specific questions or circumstances without first seeking your own professional's advice.  GREFPAC is not a law firm and does not offer professional legal services.  The information in this publication is not intended to create, and the transmission and receipt of it does not constitute, a confidential or lawyer-client relationship.  The act of contacting GREFPAC will not create a confidential or lawyer-client relationship, and your communication will not be treated as confidential. GREFPAC makes no warranties, representations, or claims of any kind concerning the information available from, or the distribution of, this newsletter.  GREFPAC and contributing authors expressly disclaim all liability to any person in respect of the consequences of anything done or omitted to be done wholly or partly in reliance upon the use or contents of this newsletter.  The information contained in this newsletter may concern allegations made in civil lawsuits and in criminal indictments. Such allegations may be found by the court to be untrue.  All persons are presumed innocent of criminal allegations until convicted of a crime.  Court opinions may be subject to the parties' motion for reconsideration, the court's reconsideration, and editorial changes made by the reporter of decisions.  We are eager to make corrections quickly and candidly.  An aggrieved party need not have a letter to the editor published for us to correct a mistake. We will publish corrections on our own and in our voice as soon as we are told about them and can confirm them.
10-Years
UPCOMING EVENTS
 AT A GLANCE 

   

Sept. 7, 2011
Quarterly Educational Meeting
9:30am - Noon
Atlanta Jr. League
3154 N'side Pkwy.
Atlanta, GA 30327

Dec. 7, 2011
Quarterly Educational Meeting
9:30am - Noon
Atlanta Jr. League
3154 N'side Pkwy.
Atlanta, GA 30327
  
 
THANK YOU
2011 SPONSORS


Diamond

Fannie Mae 

Silver

BurrForman

GREFPAC - New York Time

GREFPAC - New York Time

LotsteinLegal

Southeastern Evaluation

SSI

Valuation Management Group

Bronze

Accurate Quality Control, Inc.

Brand Mortgage Group

ComplyShare, LLC

Georgia Dept. of Community Affairs

Georgia Real Estate Closing Attorneys Ass'n (GRECAA)

Morris | Hardwick | Schneider, LLC

Old Republic National Title Insurance Co.

Real Property Law Section of State Bar of Georgia

Stewart Title Guaranty Co.

The StoneHill Group, Inc. 
Georgia Real Estate Fraud Prevention and Awareness Coalition, Inc.
1188 Dorby Park Drive
Atlanta, GA
30319
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