$1.5M Foreclosure Fraud Scheme Busted

During a routine title exam, Lisa H. uncovered a forged quit claim deed. After a more thorough investigation, Lisa discovered the deed was one of many recorded by two brothers who were recently charged with a $1.5 million fraud scheme.

Foreclosure Fraud Lisa works for one of our sister companies as a title examiner. She was examining the chain of title for a residential sale of property in San Bernardino County, Calif. with a $350,000 sale price when she came across a deed she was sure was forged.

These were the signs that made her question the deed:

  • To avoid the payment of transfer tax, the transfer was declared a “gift” on the face of the deed
  • It was an uninsured deed and not recorded by a title company
  • The deed was handwritten
  • The handwriting matched the signatures on the document, including the signature of the notary
  • The notary stamp reflected the notary’s last name as “Desahagun” however the notary clearly signed his name as “Deshagun”
  • The notary’s name was listed on the office postings as a suspect and all documents containing the notary’s stamp should be scrutinized
  • The grantor’s signature did not match signed documents recorded previously in the chain of title
  • The “when recorded mail to” name and address was neither the grantor’s nor the grantee’s
  • Lisa ran a search on the grantee’s name, David Zepeda, and found approximately 70 other properties in which he was suddenly the owner

Lisa brought the deed to the attention of the advisory title officer and together they called the escrow officer to provide their detailed findings and to notify the escrow officer our underwriters would not be issuing a policy for this transaction. The escrow officer in turn called the property owner to find out if he in fact executed the handwritten deed. It turns out he did not. Lisa was right, the deed was a complete forgery and the true owner stated he had no intentions of selling his property.

The property owner then reported the incident to the District Attorney’s office. As it turned out, he was not the only victim of David Zepeda. The District Attorney’s office confirmed that David Zepeda and his brother, John Zepeda, were being investigated as part of a ring of suspects involved in a foreclosure scheme known as the David Zepeda Trustee Foreclosure scam, which so far has claimed hundreds of victims.

This story is an excerpt from our parent company’s Fraud Insights newsletter.  To read the entire article, click here.

A Proactive Approach at Ticor Title Northwest
Our seasoned Title Officers, Examiners, Escrow Officers, and Escrow closers in Ticor’s Puget Sound operation are trained to operate with the highest standards of conduct.  We are proactive in our efforts to identify potentially fraudulent activity in any transaction.

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