If you believe you or your buyer has fallen victim to a short sale scam, you should contact the police and the Bureau of Real Estate.
To protect short sale buyers going forward, remember to include a Short Sale Addendum (C.A.R. Form SSA) in the offer. The default agreement in the SSA is that the buyer is not required to submit any deposit to escrow until three days after receiving all short sale lenders’ written approval.
The buyer made an initial deposit in the $5,000 to $15,000 range into the listing broker’s non-independent broker escrow in a short sale agreement. As with most short sales, the process takes several months and the selling agent is assured that the listing agent is working towards lender approval, it is “just taking more time.” The communication slows down, the selling agent begins to get concerned and calls the listing broker’s escrow. There is no answer and no return call and no other number to contact.
A case has been opened with the Long Beach Police Department, Financial Crimes Division. Detective Robert Ryan is officer in charge: (562) 570-7391. As of late December there were approximately 20 victims, but the C.A.R. Hotline has received more than 15 calls since the first of the year. All have been referred to the Long Beach Police; the California Bureau of Real Estate is also aware of this case.
The LA County Sheriff has made an arrest in what appears to be an identical scam, involving at least 32 victims with a total loss of $498,000. To contact the LA Sheriff’s office, call Detective Keith Clark at (562) 946-7217, or tips can be made anonymously at Crime Stoppers, (800) 222-TIPS (8477).