New legislation helps the Attorney General go after deed theft

May 1, 2023 Rob Abruzzese
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New York Attorney General Letitia James announced new legislation to combat deed theft. The legislation, supported by State Senators Brian Kavanagh and Zellnor Myrie, and Assemblymember Helene Weinstein, aims to strengthen protections and remedies for victims.

Deed theft predominantly targets Black and minority homeowners, with current laws offering limited opportunities for prosecution. The legislation establishes a crime of deed theft, helping to keep families in their homes and expand opportunities for victims to seek justice.

“No one’s home should be stolen by a scammer without warning or reason,” said Attorney General James. “Victims of deed theft are often older adults and people of color who are asset rich but cash poor. Homeownership is a stabilizing economic force for their families and loved ones, and deed theft robs them not just of their family home, but of their most significant financial asset and the community they have known for their entire lives.”

Deed theft is when someone takes the title, or deed, to another person’s home without their knowledge or approval. Elderly homeowners and homeowners of color in gentrifying neighborhoods are disproportionately affected. From 2014 to the present, the New York City Sheriff’s Office counted nearly 3,500 complaints of deed theft throughout the city.

Scammers typically use forgery or fraud to steal deeds. In forgery cases, they falsify the actual homeowner’s signature on a deed and file it with the county clerk, making it appear as if they purchased the property. In fraud cases, scammers deceive homeowners into unwittingly signing their homes over. The thieves then frequently evict the homeowner and sell the property for a substantial profit.

The new legislation introduces several key changes to both criminal and civil laws. One of the main changes proposed is the establishment of a crime of deed theft, which amends the Penal Law to create two separate classifications: Deed Theft in the Second Degree, a Class C Felony, and Deed Theft in the First Degree, a Class B Felony.

Another significant change is granting the Office of the Attorney General (OAG) concurrent original jurisdiction to prosecute deed theft crimes alongside District Attorneys throughout the state. Previously, the OAG could only prosecute criminal deed theft cases with a referral.

The legislation also extends the statute of limitations for felony criminal prosecution of deed theft from five years to eight years. This allows more time to identify and investigate cases, as victims often become aware of the crime after it has occurred.

In addition, the legislation enables prosecutors to file a legal action on properties where a deed theft has taken place or is suspected. This acts as a legal “red flag” on the property’s records, making it difficult for scammers to take out loans against the property or sell it to an unsuspecting buyer. This provision also eliminates a potential good faith purchaser’s protected claim to the home.

Another change is the ability to stay eviction proceedings in housing court when the rightful homeowner can show reasonable evidence that there is an issue with the title of the property or a potential deed theft in progress. This helps keep New Yorkers in their homes until the suspected deed theft case has been litigated.

The legislation expands the protections of the Homeowner Equity Theft Prevention Act (HETPA) to include homeowners with active utility liens. Previously, these protections were only available to homeowners whose properties were in foreclosure or on the tax lien sale list.

“At the Senate’s hearings on deed theft last fall, we heard from many homeowners and their families who lost everything to scammers, fueling an exodus of longtime New Yorkers from the communities they’ve lived in for generations,” said State Senator Myrie.

“Too often, state government has been unable to prevent or prosecute this destructive crime. I’m grateful to our Attorney General and my colleagues for introducing strong legislation to protect homeowners in Central Brooklyn and across the state.”

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