Scam Alert: House Stealing! Combines Identity Theft & Mortgage Fraud

Thieves steal and sell your house, leaving you stuck with the mortgage

A new type of crime is targeting homeowners. It's one that combines identity theft with mortgage fraud.

When you mix those criminal activities together, you end up with a scam that threatens the American Dream of owning a home. This new crime is called house stealing, according to the Federal Bureau of Investigation (FBI). And some victims of this illegal scheme are desperate homeowners facing foreclosure.

Authorities say house stealing is a complicated crime that has a several twists and variations. In most cases, though, here's how it works:

• Con artists pick out a house to steal;

• They steal that homeowner's identity. They get their names and personal information -- and then make fake social security cards, driver's licenses, or other forms of identification;

• Con artists go to an office supply store and buy forms to transfer property;

• They forge the homeowner's signature on those documents and file them with the appropriate governmental office - usually the county recorder of deeds office;

• Once those papers are filed, the deed to the house transfers to the con artists. And the home belongs to them.

In another twist to the crime, con artists look for vacation homes or rental property to steal. They find out who owns the property, steal their identities, and follow the same steps to transfer the deed to their house into their names. In these cases, though, authorities say the con artists put the empty houses on the market and keep the proceeds from their sales.

Sometimes, these con artists even sell homes while unsuspecting families still live in them.

The con artists -- who have already transferred the deed to the homes into their names -- find buyers who are willing to purchase the properties based on a few online pictures.

The con artists keep the proceeds from the illegal sales - and the rightful owners continue paying the mortgages for homes they no longer own.

Straw buyers

This crime can become even more complicated.

Consider a case the FBI and Internal Revenue Service (IRS) investigated last year, which targeted homeowners facing foreclosures. That investigation revealed a 35-year-old real estate owner in southeast Los Angeles defrauded more than 100 homeowners and lenders out of $12 million dollars.

The real estate agent, Martha Rodriguez, promised to help struggling homeowners pay their mortgages by refinancing their loans. Instead, Rodriguez and her partners allegedly used stolen identities and filed fraudulent loan documents to buy those homes.

They also used what are called "straw buyers" in the scheme. These are individuals who are paid for the illegal use their personal information. The "straw buyers" also filed loan documents -- ones that contained false information -- to buy some of the homes. MORE