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Yes a long time in coming and finally here
SJ Mercury news article
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I take it that you have had dealings with their real estate folks before? I once was in the market to buy and made a mistake of going with this group. I can't recall the agent's name but he was more interested in showing me anything to close a deal instead of listening what I wanted. After 3 days, I left the bum. I wish I could recall his name to see if he was one of the ones indicted! ;-) Do any of your know what happened to the ones that were the owners of Su Casa? Bic and David? I haven't heard anything on the lawsuits, etc...
2500 gets you someone elses credit? i wouldn't give up my credit score for their whole commission...
The best part is:
Sixteen agents for a once-booming East San Jose real estate brokerage are facing state disciplinary action and possible loss of their licenses for using "straw buyers" and other fraudulent schemes to finance more than $7 million worth of real estate deals.
"Possible loss of their licenses"? W.T.F. And anyone is supposed to take the real estate industry's ability to self regulate seriously? So, you can commit criminal fraud in four documented counts, knowingly and willingly violate loan contracts, and break numerous state and federal laws (including employment laws), and the response from the great state of California DRE is that you might lose your license.
It's getting old, but for crissakes! 1% of those violations would land a CPA or Series 7 in federal prison, or at least with a life-disabling fine to pay. It's high time to blow up the Cal DRE along with every other state agency and throw this entire mess under the SEC.
They have too say that until they are convicted...and it won't be their only punishment.
No they don't. Other professionals can lose their licenses at the discretion of the agencies/boards that govern that licensing. You can lose a CPA without being criminally convicted. You can and will lose the other licenses for even less. It's called *self regulation*. What part about that does your industry not understand? "Oh oh oh! We can't discipline anyone unless they are convicted." No wonder real estate agents & brokers feel comfortable doing whatever the hell they want. It's all good unless you get caught.
I am just saying the way the DRE is currently set up, it is all they can do. They can't even prosecute criminally.
What We Can Do--------------------------------------------------------------------------------We investigate complaints against real estate brokers and salespersons accused of misleading or defrauding consumers. If we can prove a violation of the Real Estate Licensing Law, a formal hearing may be held which could result in the revocation or suspension of the agent's license.
How can you trust the DRE when the head puppet for the realators, Lawrence Yun, just keeps saying that it is great time to buy as home prices continue to drop..Do you really think that they will clean up their industry? The only thing that is cleaning up their industry is that that these loosers are now getting caught because of the down turn and folks who were greedy as well are now left holding the bag and want others to blame to cover their butts.
If anything, Rob actually proved my point. Other self-regulatory bodies work hard to establish and maintain credibility. For that reason, a medical board, a state Bar, (most) state's CPA boards, etc. all hold their members to standards higher than the current established law. It's not that hard to understand. It's in the term *self regulatory*. They do this so that laws don't have to be and are not passed explicitly regulating their industry any more than necessary. All these fields have learned that when they fail to do so, the legislatures and courts move in to set rules for them. So they fight very hard to keep their members in line. And, more importantly, they are willing to boot members who violate things like their codes of ethics.
Imagine that. Actually getting booted from your professional body for violating their code of ethics. Perhaps if the California DRE bothered to do that a few times, and then defended themselves vigorously against any lawsuits from pissed off realtors, they'd set a higher standard. You think? As it stands now all the self-regulatory real estate industry bodies do is communicate it's all good so long as you don't get caught. More akin to a prison guards union than a professional board.
I should have said CAR. The DRE is simply the CAR's patsy in CA. The DRE should be to the CAR as the SEC is to the FASB.
I believe that DRE is actually restricted from criminal prosecutions and other actions, because real estate fraud is the sole domain of the FBI.
Thats great and all, but I would agree with you that the DRE needs more bite, they should be a little more inline with the DOC which many lenders are licensed under.
You will get a kick out of this.
I believe that DRE is actually restricted from criminal prosecutions and other actions, because real estate fraud is the sole domain of the FBI. RE State License or Federal License ? ... cross border commerce or instate only ?
It's high time to blow up the Cal DRE along with every other state agency and throw this entire mess under the SEC.
LOL! SOX 404 for California Realtors... LOL! Oh I like to see that one happen...
which petition do i sign?
I will go on the lending side of this equation since I know that compared to the Realtor side.
Mortgage lenders, and brokers are state licensed only there is no federal license, only banks have national licenses. lenders and brokers can be licensed in several states. When it comes to fraud, the FBI works with MBA, NAMB, and local authorities to detect it. If it is large enough the FBI will prosecute, if not they will let the local authorities handle it.
"If anything, Rob actually proved my point." Randy, you hit the nail on the head with that post! My better half is a past state pres of the CPAs here, and you couldn't have put it better. It's high time the Realtors had that same goal, forced or not.
I think you're missing the point Rob. There are variously both state and federal laws (both common and statuatory) that apply to real estate, much the same as the other professions listed. There are no "Federal licenses" for any of those professions, except for certain aspects of banking as you pointed out.
I will ammend my prior statements to say that the CAR (Calif Assoc of Realtors) should be actively kicking out its members who abuse self-regulated rules put in place by the national and state realtors themselves. A state accounting board can kick out a CPA within that state even if that CPA has not been prosecuted and convicted by the SEC (or IRS for tax accountants). They do this to bolster the credibility of their license, and to keep the enforcement divisions, _both state and federal_, from forcing even more burdonsome regs upon them.
Why are you falling back on an argument about the DRE being unable to prosecute? Firstly, the state absolutely can and does prosecute real estate fraud. In fact, it is not a federal issue unless there is interstate impact, tax evasion, or mail fraud. The state has the sole jurisdiction over land within that state so long as they don't violate the Constitution or federal laws (like fair housing, etc.). If the DRE cannot recommend, trigger, suggest, or even whisper to the state attny to get prosecutions going, then that's their own failing.
Of course, as we've found out over the past couple years, there aren't even that many actual laws in CA to regulate real estate. It all falls back on the CAR, which is basically just letting the inmates run the jail.
I am not trying to argue with you and say things are perfectly fine the way they are set up. These state agencies are limited in their powers right now. I am all for good solid fair regulation, it would help the industry.
I believe CAR can kick out members, but CAR is just an association you pay your dues too, the license itself is issued by the DRE.
When it comes to agencies, ironically they do not talk to one another. Lenders get shut down by DOC, but DRE does not revoke their license, or vice-versa, because they compete with each other for tax dollars and press as the states top dog. Its all messed up and has been.
From the FBI, so that you can believe me that they handle all mortgage fraud.
"Combating significant fraud in this area is a priority, because mortgage lending and the housing market have a significant overall effect on the nation's economy. All mortgage fraud programs were recently consolidated within the Financial Institution Fraud Unit, even where the targeted lender is not a financial institution. This consolidation provides a more effective and efficient management over mortgage fraud investigations, the ability to identify and respond more rapidly to emerging mortgage fraud problems, and a better picture of the overall mortgage fraud problem."
Link to FBI publication
False. They are only talking about Federal mortgage fraud investigations. They have no jurisdiction over individual state fruad actions unless they fall under the situations listed earlier. They are specifically looking into banking-related (ie, lender related) fraud.
Fraud can be prosecuted at a state level regardless of what the fraudulent issue involves, even if it overlaps a federal case, though as I understand it they usually defer to federal cases since those carry stiffer penalties and jail terms.
Yes Timothy,Su Casa also had a Hollister location and big plans to open a Gilroy franchise. Even as a new agent I had very strong feelings about agents acting as loan brokers and just wouldn’t do it (very common in my area) I had a buyer with a small down-payment and could afford a fixed loan but did not like the homes nor (safer) loan programs being offered by the honest lenders referred to them. They spoke w/an agent from that company about a loan and were promptly told that I (who had expressed concern about a potential short term loss in value…home prices were still on the rise) did not have a clue about real estate and that they could get them a much nicer home (about $200k more) with a “special loan” that they could “easily” refinance out of in a couple years and if they used them for the loan and as the agent to purchase they could also get cash back out of the deal. The buyers called me a couple months ago…you can fill in the rest. I can’t help them due to what was likely on the loan app.Yes Randy,We need so much more regulation, education and consequences which should come so much more swiftly.
Well Realtor_GRI it is not surprising all this that is happening with Su Casa during this fall out. This is not the first story of fraud from this company. I heard that they not only did this but as a company didn't pay franchise fees, pay contractors for work done, etc, thus they were like sued for ~$2 million. I also heard that there were other realtors arrested earlier, I think and husband and wife team from Su Casa that had a similar scheme. I wonder how all of this could happen under Bic who I read had the broker license for this company and that nothing happened to him? Just plead ignorance and move on huh?
National Resources for Reporting Mortgage Fraud and ScamsThe Federal Bureau of Investigation (FBI)http://www.fbi.gov/(202) 324-3000 – National FBI Financial Institution Fraud UnitThe FBI, a branch of the United States Department of Justice, is authorized to investigate and enforce criminal laws of the U.S. The FBI investigates criminal acts involving potential violations of the United States Federal Criminal Code. State authorities investigate criminal acts which are violations of their state’s criminal laws.In conjunction with the ‘White Collar Crime’ department, the FBI investigates mortgage fraud, which often involves many professionals working in collusion: bank loan officers, realtors, appraisers, accountants, and mortgage brokers. All of these profit through various commissions, fictitious sales and fees – often on loans that aren’t genuine.To report mortgage fraud with the FBI, contact the Field Division listed under each state.
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