Tom Kelly: Con artist focused on run-down yards

Have you heard the one about the crook who looked for shabby yards?

We often discuss the advantages of keeping the home in top condition – especially the exterior. A clean, well-kept yard not only increases value, but it also gives the impression the owner is present and involved in its maintenance.

I was reminded how detrimental extremely poor “curb appeal” can be when a rental management company representing an absentee landlord allowed renters to trash a home in Tacoma several years ago. It turned out that at least one person was taking notes – and hoping to take the owner to the cleaners.

In this case, James Andrew Ryan pleaded guilty to four counts of forgery involving fictitious quit claim deeds. In each instance, Ryan went looking for what he judged to be run-down homes with unkempt yards. He wrote down the address and researched the owner’s name through county records. Ryan then forged the owner’s name on a quit claim deed and finished it off with a bogus notary public seal. The phony quit claim deed, showing the owner’s interest conveyed to Ryan, was then recorded at the Pierce County, Washington auditor’s office.

Tony Edwards, the absentee landlord, said his case was compounded by a poor rental management company. Edwards had intended to live in the home but a job transfer sent him to Denver and then Salt Lake City.

“I had left the home in very good condition and with very good renters before turning over the maintenance to the management company” Edwards said. “When the first group of renters moved out, the management firm rented to a large family that apparently had a lot of relatives. The place got run down in a hurry.”

Ironically, Edwards was contacted about Ryan by one of the renters.

“The renters tracked me down and said the management firm had not shown up to fix some plumbing,” Edwards said. “They also said there was a guy coming around saying he was the new owner.”

According to investigators in prosecuting attorney’s office, some of the four homes had old cars in the yards. When Ryan tried to get a car removed from one house, the real owner appeared and asked the tow truck driver what he was doing on the property.

The actual owners of the property denied ever knowing Ryan or selling or conveying property to him. He was eventually sentenced to two months in prison, and ordered to pay restitution to the victims and perform 240 hours of community service.

The Ryan case may be the first known case of real estate fraud focusing of run-down homes coupled with bogus quit claim deeds. The most common real estate fraud known as equity skimming, or rent skimming, typically includes a supposed good-hearted investor looking to help a desperate homeowner.

Instead, the investor persuades the homeowner into believing the investor will pay the bank a sum of cash to keep the mortgage from going into default if the homeowner “rents back” the home from the investor. The investor then runs off with two-three months of rent and sometimes even the title to the house.

According to investigators and attorneys, the problem with real property and property law is that most everything in question is determined after the fact. Personal property is a lot different. You have a car and you have your name on the title. You physically give it over to the new owner. It takes longer to do that with real property.

The Ryan case jump-started questions about how far county auditors should go to check the authenticity of documents. There had been instances in which blatantly altered, bogus real estate deeds had priority over the real deed. The most common avenue open to the consumer to prove that his is the correct deed is to hire an attorney and file a quiet title action in court.

If you are involved in a private real estate purchase without an agent or attorney, go through formal escrow and obtain a title report and title insurance. This may not turn up every possible bogus activity, but you will probably get more warning about possible blips on the title.

And, keep up your yard. You might not care what some people think – but you never know what they might try.

Tom Kelly’s new E-book “Bargains Beyond the Border: Get Past the Blood and Drugs: Mexico’s Lower Cost of Living Can Avert a Tearful Retirement” is available online at Apple’s iBookstore, Amazon.com, Sony’s Reader Store, Barnes & Noble, Kobo, Borders Books, Diesel eBook Store, and Google Editions. It mirrors a recent article by CNN on the benefits of the country, including increased rental possibilities