(The Center Square) — New York state prosecutors will have far-reaching powers to investigate ‘deed theft’ cases under a bill signed by Gov. Kathy Hochul, which seeks to protect property owners from being defrauded out of their home titles.
The legislation, which passed the state Legislature during the recent session, gives the state attorney general and local district attorneys the authority to look into cases of deed theft to pause eviction and ownership disputes while also expanding the list of crimes that allow state prosecutors to void fraudulent sale and loan documents.
Hochul touted the new law as the “strongest tool yet to crack down on illegal deed theft and put the American Dream back in the hands of thousands of New York homeowners.”
“With the protections enshrined in this legislation, we are empowering homeowners and law enforcement to fight back against deed theft and keeping families, homes, and communities intact,” the governor said in a statement.
Deed theft typically involves someone taking the title to a home without the homeowner’s knowledge or approval, usually with scammers faking someone’s signature on a deed and filing it with the county clerk. In other deed fraud cases, a homeowner unwittingly signs the property over to a scammer.
The new law requires judges to grant a stay in the case of ongoing investigations or where the government has initiated civil or criminal actions. That means if prosecutors find probable cause, they can file a notice of pendency as a “red flag” to alert buyers and lenders to title issues to help stop further transactions from happening.
The new law also sets a legal presumption that a deed transfer was fraudulent in civil disputes over ownership when a party to the transfer has been convicted of deed theft or related fraud concerning that property unless a defendant can prove otherwise.
Nearly 3,500 deed theft complaints have been filed in New York City alone in the past 10 years, according to the New York City Sheriff’s Office. Many of them impact minority neighborhoods.
Attorney General Letitia James, who proposed the changes, said the law will give her office a long-sought authority to target deed theft perpetrators and raise awareness about the crimes.
“Deed theft robs New Yorkers, especially older adults and people of color, of the generational wealth built through owning their homes,” the attorney general said. “The perpetrators of deed theft force their victims to endure humiliating and terrifying situations, often evicting families from their homes.”