Faced with foreclosure after losing $ 19,000 on his mortgage, an Anaheim man took matters into his own hands.
Sitting at his keyboard, he tapped an official-looking one-page document stating that his mortgage did not exist.
“I searched and searched your records and found out that you did not have such records,” he wrote. “Therefore, I demand that you delete this recording immediately.”
The owner then took his document to the county and attempted to file it with the Orange County Registrar’s Office.
If he had succeeded, more than $ 300,000 in debt would have disappeared. Her four bedroom, 2.5 bathroom condo would be free and clear.
Instead, the county dismissed his case as “unregisterable.” His property is in the early stages of the foreclosure process.
Influenced by the ‘sovereign citizens’ movement, the Anaheim owner is among a growing number of people filing liens and advisories seeking to write off mortgages, eliminate auto loans, write off credit card debts and to end foreclosures, according to county and law enforcement officials.
The documents are worthless, officials say. But some supporters of sovereign citizens charge fees for seminars or foreclosure assistance and the FBI warns their approach amounts to foreclosure fraud.
Like other loan modification and bailout scams, these operators make money by promising relief, but fail to deliver, according to the FBI.
“Innocent members of the community who don’t believe in the ideology can be sucked in and swindled out of their money, and they end up getting foreclosed because they don’t pay their mortgage,” said Lawrence Buckley, an anti-FBI . Terrorism Supervisor in Northern California. “… With the slow economic recovery and difficult times for many, it’s probably not surprising that this is a growing problem. “
Sovereign citizens argue that the US government is illegitimate and that supporters of the movement are not subject to US laws – that everyone is “sovereign” and a man or woman “of flesh and blood,” as opposed to businesses created by the government. seashell, or “straw man”. Sovereign citizens also believe that paying taxes is optional.
Some of the group’s more extreme supporters are known for their connections to the 1995 Oklahoma City bombing, attacks on police officers, and filing of privileges against judges and law enforcement officials. But the movement’s influence has also seeped into real estate as growing economic desperation created a receptive audience among underwater owners.
“They don’t believe mortgages are legitimate because no money changes hands,” said Ann Fulmer, co-author of the Atlanta-based Interthinx Mortgage Fraud Risk Report. “Everything is electronic, so (they believe) there is no enforceable debt. “
The Southern Poverty Law Center has estimated that the sovereign citizen movement has approximately 300,000 followers. At least a third are die-hard members, said Mark Potok, a senior member of the center.
“In this time of financial hardship, a huge number of people have taken an interest in this group and its false promises,” Potok said. “The reason is that it is something that promises something for nothing.”
Bearing names like “Fraudulent Registration Notice, Revocation of Trust Deed, and Full Mortgage Release,” some documents filed by followers seek to do away with mortgages.
“By virtue of the legitimate powers of the TRUSTOR of this modern statutory trust deed, I revoke said trust deed, ” wrote a petitioner in a drafted document filed in Orange County in July. Attached is a “certificate” indicating that the declarant is “the living man created in the image of God”.
Other filings seek to delay or stop foreclosures by obscuring title or adding new owners to the deed.
A man from Yorba Linda who is $ 20,000 in arrears on his mortgage has filed an “acceptance of deed” with the county, acknowledging receipt of a deed for the house he already owns.
In an attached affidavit, the owner has described himself as “a living, breathing and sentient being on the land, a natural person, and therefore is not and cannot be an ARTIFICIAL PERSON”.
The government, he writes, “is a fiction of the mind,” adding that it is exempt from “any process, law, code or statute.” He declined to comment on his petition.
“It’s a way to get something for nothing. They offer documents that have no real value, ”said Tom Reitz, the FBI special agent in charge of white collar crime in Orange County. “It’s a loan modification niche (scams). “
In August, a man from South El Monte pleaded guilty in US district court to charging around 200 homeowners $ 15,000 each to eliminate their mortgages by filing citizen-inspired sovereign documents, according to the US Department. of Justice.
Prosecutors alleged that Ernesto Diaz, 57, made $ 2.5 million from this approach. He admitted his process never worked and even cost his brother his house, the Justice Department said.
In September, a federal grand jury in Alabama indicted James Timothy Turner, the self-proclaimed president of the “Republic of the United States of America” as sovereign citizen, accusing him of paying taxes with fictitious bonds and of organizing seminars to teach his methods to others. , said the Justice Department.
“There is a whole underground world of seminars and related events where this so-called knowledge is learned,” said Potok of the Southern Poverty Law Center. “Get out of your mortgage. No longer have debts. … It’s a lucrative proposition for these people.
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