By Jasmine Otam
Indiana government officials hope legislation passed this session will prevent property owners from falling victim to tax sale fraud.
“Since our economy has improved over the last few years, it is all too easy to forget that there are still people that are struggling to maintain their homes,” Attorney General Greg said at a press conference Friday.
The scheme involves scam artists approaching property owners that are behind on their property tax payments and convincing them to sign quitclaim deed, a document that transfers ownership of real estate from one person to another, in exchange for minimal amounts to make the delinquent tax problem disappear.
Homeowners are usually unaware they are legally entitled to receive the surplus between the tax owed and the price the house was sold for at auction. Due to schemes like this, homeowners are being cheated out of surplus amounts, and by the time the fraud is discovered Hoosiers can be out of their surplus money and home.
“This is a scam that has occurred in urban areas such as Marion County and Lake County, as well as more suburban or rural areas such as Johnson County. Homeowners who were already in a difficult bind financially have been harmed by these scam artists who promised an easy way out,” Zoeller said in a statement.
Just last month the Attorney General’s office filed a $9 million lawsuit against various entities for allegedly scamming at least 48 Hoosiers through tax sale fraud. Hoosiers lost amounts ranging from $2,000 up to $900,000.
“While my office continues to investigate this scheme and hold violators accountable, legislators took quick action on a bipartisan basis to stop this fraud from occurring in the future and make sure homeowners receive the surplus owed to them, which may be enough to help them get back on their feet,” said Zoeller in a statement.
Senate Enrolled Act 355 addresses gaps in state law to prevent homeowners from being cheated out of surplus tax sale amounts to which they are entitled. It would ensure that any entity that purchases a property with a tax sale surplus must pay the full surplus amount – in addition to the amount of taxes owed – in order to redeem the property, so that the surplus gets returned to the original property owner.
The legislation is now awaiting consideration by the governor.
Zoeller and his administration work with Indiana Legal Services and provide many free services to inform and protect Hoosiers against fraudulent transactions, like tax sale schemes.
“Before you get to the tax sale, you should really take advantage of some of the opportunities to get free legal services to help you make the right decisions,” Zoeller said Friday.
Homeowners who suspect they have been defrauded are encouraged to file a complaint with the Attorney General’s office at www.IndianaConsumer.com or by calling 1-800-382-5516.