It's Real Estate Fraud Week at L.A. Land: Chapter 2 -- Why Is My House on Craig's List?

It is Real Estate Fraud Week at L.A. Land -- send your stories to lalandblog@yahoo.com. This one came to us from a friend of a friend, and it involves a brazen scam we'll call "Let's Rent Out That Abandoned House."

Jessica bought a 1,400-square-foot Spanish fixer in Wilshire Vista in November and hasn't moved in because she's still working on architectural drawings and permits. Result: empty house, unmowed lawn.

Jessica, meantime is at her parent's in Rancho Mirage on a Saturday night, searching Craig's List for a new rental and sees a house for rent that she can afford -- coincidentally, it's in the same neighborhood as her fixer.

"It's two bedrooms, one bath, and then I see the address and it's MY ADDRESS!" she tells L.A. Land. "I'm totally shocked! I told my parents, 'I just saw my house on Craig's List! I click on it and it describes my house to a T.There's no contact information, but it says there's going to be an open house on Sunday!"

Continue reading below to find out what happened. Trust us, it's wild.

So Jessica's mother tells her to call the real estate agent who sold her the house. She does, and he "flips out."  Then Jessica's dad weighs in: "I think you should call the cops." She does, on Sunday morning -- the day of the mysterious open house at her house. An officer agrees to drive by the house later that day.

Around 12:30 p.m. Sunday, Jessica's real estate agent calls, reporting he is at the house and nothing is happening. He can't stay -- he's got an open house of his own to go to. All is well. But then, at 1:30 p.m., the agent calls Jessica back. "A neighbor had called him and told him, 'The open house is happening right now! There's a woman inside the house, she's got signs outside, and she's showing the house!'"

So Jessica, still in Rancho Mirage, calls the LAPD again with this update. Soon the agent calls her with another update: "Neighbors had been to the open house, and they told him the woman is taking cash deposits from people! Multiple cash deposits!"

So Jessica calls LAPD for the third time to relay the latest, as well as a new fear: maybe this is some kind of identity theft scam.

She waits by the phone for a while, and then gets a call from an LAPD officer. "He says, 'I'm inside the house with the woman and she's claiming she's legit. She says she works for a realty company and she's showing the house.' Then the cop asks me, 'How can you prove you're the owner?'"

"My Dad says, 'You have the title! Tell him you have the title!' So I say, 'I have the title, I'll fax it to you!'"

The police officer tells Jessica he's going to have to call his supervisor and ask for guidance -- He's never been in this situation before, and he'll call her back.

"He calls back a little while later and I ask him -- 'Does she have a key to the house? Is she a Realtor? Does she have a license?' He says the woman claims she's working for a Realtor, but she isn't a Realtor herself. At this point, the cop is starting to believe me."

"But they have no proof of breaking and entering. All they have is petty theft -- the cash she's taken from people who think they're putting down deposits. So they let her go."

Here's where it gets even better: "But after they let her go, they spoke to another neighbor who saw her climbing through a window, so they put out a warrant for her arrest."

So that's the scam: someone saw an abandoned house, listed it for rent on Craig's List, put up some signs, climbed through a window and held an open house and started collecting deposits.

"She didn't even clean it up," Jessica says.

She has since had the locks changed, activated a security system and is getting the lawn maintained. She's convinced the woman had a partner in crime.

"This is probably a scam they run -- driving around looking for houses that look vacant," Jessica says.

How does she feel about the whole thing?

"Initially it was pretty freaky. But once we had them caught in the act -- once I knew what was going on, I wasn't that upset about it. And the good thing is, as a result, I've met several of my neighbors, who are really kind."

Wow. Can anyone top that?
Photo Credit: istockphoto.com

Comments

[Ron]

I trust Jessica alerted the folks at Craigslist...didn't she? To say they would be interested in the scam would be an understatement. And they might be able to track down the perpetrators.

[matvox]

I don't believe any of this. It doesn't ring true and I'm surprised that the LATimes would print it with no substantiation. Total urban myth and total nonsense. You should be a ashamed of your selves.

[Larry]

That's not exactly new. Maybe the open house angle, but scammers have been listing houses / apartments "For Rent" on Craig's List and running off with deposits for years now.

[Thera]

The police let the woman scammer go free ???? Is this really a police procedure for such cases ?

[Evil Landlord]

Old scam, but first time I've heard of the police even caring!

When I was renting my place out, one of the neighbors was showing it and taking cash deposits- I had no idea what was going on until the "renters" (not the ones I would have chosen) started coming around to move in or get their deposits back.

The police couldn't do anything about her taking money unless one of the victims reported it.

[Jay]

This is an old old scam: not exactly newsworthy. Slow news day, eh?

[ken]

I can't believe this. If this is true then the damn police officer should be fired. Crime is occurring and he has to call his supervisor.

[Mary C.]

It might not be new, but not everyone has heard about it, or thought about it lately if they have. Craigslist and other Web sites have made it easier and quicker to run this type of scam very quickly. Yes, it can happen. Someone could have also moved in to that house and squatted, and it's not always easy to remove them. Plus, a lot of damage could be done. What is foolish is someone buying a house, not occupying it, and not keeping a close eye on it. Every day. You can't not do that with all the homelessness and scam artists out there. Plus, it's not fair to your neighbors if your unoccupied property attracts crime and nuisances, and you can face nasty liabiliity suits if anything happens.

[mdporter]

What kind of idiot buys a house, makes payments on it for 9 months, and doesn't live in it? Must be nice to be able to waste all that money. Bet the neighbors appreciate the eyesore too.

[Kevin]

Not exactly new, here's a link to a video where they do the same thing with a rented car.

http://www.techeblog.com/index.php/tech-gadget/the-real-hustle-hired-car

[David]

I don't know if this particular case is legit, but a Northern California woman found her rental completely destroyed after evicted tenants put a notice on Craig's list suggesting people could "come take what they wanted". They stripped the house to the studs!!

[Mitsu]

Urban legend? Hardly. This is an old, well-known scam, and it can and does happen all the time.

[CMC]

I'm struck by the idea that Jessica knew all this was unfolding and continued to hang around her parents house in Rancho Mirage. I would have been at my purchased house spying on the proceedings with a camera, with documents proving I own the home, and prepared to call the police from the location. Of course, if I owned the property, whether it was having work done or not, I would have mowed the lawn to give the impression that I care about the neighborhood. She sounds spoiled.

[Jim Everett]

If true, then the scammers should be treated as any other thieves. Look at what shoplifters get for stealing merchandise of equivalent value. And look what police will do if, heaven forbid, someone steals a car of any value.

And on the flipside, if this Jessica bought the house to "flip", then and left it overgrown and abandoned, then she is being highly disrespectful of the neighbors who actually live around her dump of a property.

[chelicera]

Ditto, CMC. If I thought someone was in my property, I would be there personally with the cops at my side chasing them out! What kind of person sits on their butt elsewhere while others break into his/her home and use it to commit crime? Her neighbors might be nice, but it sounds like she doesn't deserve them.

[marcus]

Here is some advice for Jessica. Instaed of trying to monitor it from far over the phone, go there and handle the situation in person.

[AB]

So I go to an Open House, looking for a place to rent, and hand the person holding the Open House cash? Yeah, right. No way. Don't believe it for a second. Plus, who is carrying enough cash for a deposit, usually a month's rent, meaning $1,000+++.

[Linda]

This story doesn't surprise me one bit.

My question is why the hopeful renters would ever give a cash deposit to anyone to hold a rental? There's no accountability when you give cash. They should have known better as well.

[Evil Landlord]

My tenants paid their deposit (all $2400 in cash) and continue to pay their rent in cash. If you are looking for a place to move into immediately, carrying the cash necessary is a good move to get approved without too much application hassle.

[DAH]

As a landlord, I ONLY take cash (or equivalent) for deposits and first months rent, personal checks just can't be relied on to clear and often take many days to a week to come back Non Sufficient Funds.

If the Scammer was only asking for $300 to 500 as a "holding deposit", I believe that it would be easy to get several bites, expecially if the rent was on the low side for the neighborhood.

[a girl in oc]

I've seen ads on Craigslist in OC asking for leads on any "abandoned" houses and I think they even offered an award if you did!! Whoever's investigating needs to check with the folks at Craigslist.

[Greg Sharp]

I have one for you. A highly trusted friend introduces me to someone who who has known and worked with off and on for many years. He says he has access to nonperforming asset pools that we can buy and then flip to other buyers. I raise $300,000 from friends and he buys the portfolio. Unfortunately, the initial buyer backs out of the deal and then a series of other investors just can't seem to make it work. I send a buyer and he doesn't produce basic due diligence material and says it was never provided. Eventually, I discover that he sold me a pool of proprerties that he never owned. I am now out $350K of investor cash including additional expenses. He hasn't responded to my lawyer's letter and the last text message was that we know how he is, when he is ready to take care of it it will get done. This involves real estate in 16 states, fraudulent wire transfer, forging documents, etc. And he won't say anything or even refer us to his lawyer. Unbelievable.

[Stephanie Walker]

I realize this is an old posting, but still a relevant topic. This actually just happened to my husband and I. Our Silver Lake house is currently on the market and thanks to a Google Alert I had set up for our address, we discovered that someone (not us) had posted our home under rentals on Craigslist for $7,500 a month!! Immediately I flagged it and alerted the abuse department at Craigslist. I also asked my friends to flag the posting as 'unlawful.' Craigslist was swift to respond. We weren't sure what this was all about. We thought it might have been a prospective buyer trying to rent it out before putting an offer in on the house. I'm just glad that we found it right away... thanks to Google Alert. Our house has a blog and if you want to read more about our experience with this scam (from our house's point of view), click here: http://2471silverridge.blogspot.com/2008/08/being-
pimped-out-by-craigslist-against.html