County's Document Filing Fees Hiked Again to Fatten D.A.'s Anti-Fraud Unit

A month after doubling a fee assessed in support of real estate fraud prosecutions, Riverside County supervisors hiked it again Tuesday, apparently to ensure the District Attorney's Office has the necessary resources to investigate the vast number of fraud complaints received each year.

In a 5-0 vote, the board increased the Real Estate Prosecution Trust Fund fee from $6 to $10 per document.

On Feb. 5, the board authorized an increase from $3. District Attorney Paul Zellerbach had sought the increase to $10 at that time, but because several supervisors had qualms, the board compromised and granted a smaller hike.

They left open the possibility of granting the full $10 -- as long as there was a comprehensive report on how the new revenue would be appropriated.

"This new proposal was done extremely well," Supervisor Kevin Jeffries said of the report submitted by the D.A.'s office last week to justify the larger fee.

"The district attorney is making a very compelling case," added Supervisor Marion Ashley. "He's justified in doing this."

The fees are imposed whenever an individual or business records a deed of trust, a notice of default, notice of trustee sale, affidavit, lien, lease or quitclaim deed, as well as other documents filed with the Office of the Assessor-Clerk-Recorder.

Revenue generated from the fees is deposited into the Real Estate Prosecution Trust Fund, from which the D.A.'s office withdraws money as needed - - restricted for investigations and prosecutions of mortgage and foreclosure- related scams.

The assessor's office receives a relatively small portion of the money to cover costs associated with mailing "courtesy notices" that alert homeowners whenever a document has been filed that impacts his or her property.

The $10 filing fee will generate an estimated $5 million a year, compared to around $2.8 million from the $6-per-document assessment, according to Assessor-Clerk-Recorder Larry Ward.

In his report, Zellerbach noted that the Real Estate Fraud Unit "has no document examiner ... no computer forensic examiner" and no forensic accountant on staff, leaving seven prosecutors and a paralegal to plow through reams of documents and data.

According to Zellerbach, the D.A.'s office received more than 2,400 real estate fraud complaints during the 2011-12 fiscal year, Because of limited resources, only 94 have led to investigations, he said.

The process of going through mounds of potential evidence delays prosecutions, the county's top prosecutor said. Of the 60 investigations conducted in 2010-11, only a dozen resulted in criminal prosecutions.

"Keeping up with the fraudsters in a county of almost 2.3 million people is not possible under these current budget constraints," Zellerbach wrote in the report.

According to the D.A., having a larger pool of funds to tap will enable the agency to establish anti-fraud units in Murrieta and Indio, add three investigators to the Riverside office, and hire "crucial accounting personnel to analyze and prepare financial records and forensic audits."

Many investigations stem from schemes and scams perpetrated by crooks seeking to exploit distressed property owners desperate for alternatives to losing their homes to foreclosure, but also include victims of so-called "rent- skimming" and loan scams, according to Zellerbach.

Both the Southwest Riverside County Association of Realtors and the Inland Valley Association of Realtors backed the fee hikes.

-City News Service