Posts Tagged fraud
A person filed a false document with the secretary of state’s office. Is this a crime?
Posted by David Leon in Business law, Criminal Defense on 17/05/2010
Yes. It is a misdemeanor (class A) to knowingly file a materially false document with the Texas Secretary of State’s office. If it the false filing was done with the intent to harm or commit fraud, then it can be a felony (state jail).
Sec. 4.008 Texas Business Organizations Code.
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There is a lien on my property. I just sold it for cash, but I can’t afford to pay the loan. Now the lienholder is trying to repossess. What can they do to me?
Posted by David Leon in Contract law, Criminal Defense, Real Estate Law on 07/05/2010
A person who is a debtor under a security agreement, and who does not have a right to sell or dispose of the secured property or is required to account to the secured party for the proceeds of a permitted sale or disposition, commits an offense if the person sells or otherwise disposes of the secured property, or does not account to the secured party for the proceeds of a sale or other disposition as required, with intent to appropriate the proceeds or value of the secured property. Tex. Penal Code. 32.33(e)
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What are the penalties for hindering a secured creditor?
Posted by David Leon in Consumer & Credit, Criminal Defense, Real Estate Law on 07/05/2010
You need to look at Sec. 32.33 (d) of the Texas Penal Code for the penalties associated with Hindering a Secured Creditor:
(1) Class C misdemeanor if the value of the property destroyed, removed, concealed, encumbered, or otherwise harmed or reduced in value is less than $20;
(2) Class B misdemeanor if the value of the property destroyed, removed, concealed, encumbered, or otherwise harmed or reduced in value is $20 or more but less than $500;
(3) Class A misdemeanor if the value of the property destroyed, removed, concealed, encumbered, or otherwise harmed or reduced in value is $500 or more but less than $1,500;
(4) state jail felony if the value of the property destroyed, removed, concealed, encumbered, or otherwise harmed or reduced in value is $1,500 or more but less than $20,000;
(5) felony of the third degree if the value of the property destroyed, removed, concealed, encumbered, or otherwise harmed or reduced in value is $20,000 or more but less than $100,000;
(6) felony of the second degree if the value of the property destroyed, removed, concealed, encumbered, or otherwise harmed or reduced in value is $100,000 or more but less than $200,000; or
(7) felony of the first degree if the value of the property destroyed, removed, concealed, encumbered, or otherwise harmed or reduced in value is $200,000 or more.
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I am listed in a will of a person that died. The person who has the will won’t probate it. What can I do?
Posted by David Leon in Estate planning and probate on 21/04/2010
Assuming the person who wrote the will is deceased, and the person who has possession of the original will is refusing to deliver it to the court You can file an action in probate court to “show cause” under Sec. 75 of the Texas Probate Code. Under this section, a person who has possession of a will has to appear in court and explain why the will has not been delivered to the court as of yet. If the person refuses, the court can hold the person in possession of the will in contempt of court.
Sec. 75 provides:
Sec. 75. DUTY AND LIABILITY OF CUSTODIAN OF WILL. Upon receiving notice of the death of a testator, the person having custody of the testator’s will shall deliver it to the clerk of the court which has jurisdiction of the estate. On sworn written complaint that any person has the last will of any testator, or any papers belonging to the estate of a testator or intestate, the county judge shall cause said person to be cited by personal service to appear before him and show cause why he should not deliver such will to the court for probate, or why he should not deliver such papers to the executor or administrator. Upon the return of such citation served, unless delivery is made or good cause shown, if satisfied that such person had such will or papers at the time of filing the complaint, such judge may cause him to be arrested and imprisoned until he shall so deliver them. Any person refusing to deliver such will or papers shall also be liable to any person aggrieved for all damages sustained as a result of such refusal, which damages may be recovered in any court of competent jurisdiction.
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I’ve been charged with hindering a secured creditor? What is the punishment for hindering a secured creditor?
Posted by David Leon in Criminal Defense on 25/12/2009
This is governed by Texas Penal Code Sec. 32.33(e):
(1) a Class C misdemeanor if the proceeds obtained
from the sale or other disposition are money or goods having a value
of less than $20;
(2) a Class B misdemeanor if the proceeds obtained
from the sale or other disposition are money or goods having a value
of $20 or more but less than $500;
(3) a Class A misdemeanor if the proceeds obtained
from the sale or other disposition are money or goods having a value
of $500 or more but less than $1,500;
(4) a state jail felony if the proceeds obtained from
the sale or other disposition are money or goods having a value of
$1,500 or more but less than $20,000;
(5) a felony of the third degree if the proceeds
obtained from the sale or other disposition are money or goods
having a value of $20,000 or more but less than $100,000;
(6) a felony of the second degree if the proceeds
obtained from the sale or other disposition are money or goods
having a value of $100,000 or more but less than $200,000; or
(7) a felony of the first degree if the proceeds
obtained from the sale or other disposition are money or goods
having a value of $200,000 or more.
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What is hindering a secured creditor?
Posted by David Leon in Foreclosure, Real Estate Law on 25/12/2009
Hindering a secured creditor is a criminal offense per Texas Penal Code 32.33. The most common examples of hindering a secured creditor are hiding a vehicle in order to avoid repossession, vandalizing a house prior that is subject to a foreclosure proceeding and selling financed property without paying the lienholder.
This can be a very serious criminal offense, and may result in substantial jail time. If you are being charged (or threatened), you should contact us immediately.
The statute (Texas Penal Code Sec. 32.33) says:
(b) A person who has signed a security agreement creating a
security interest in property or a mortgage or deed of trust
creating a lien on property commits an offense if, with intent to
hinder enforcement of that interest or lien, he destroys, removes,
conceals, encumbers, or otherwise harms or reduces the value of the
property.
(c) For purposes of this section, a person is presumed to
have intended to hinder enforcement of the security interest or
lien if, when any part of the debt secured by the security interest
or lien was due, he failed:
(1) to pay the part then due; and
(2) if the secured party had made demand, to deliver
possession of the secured property to the secured party.
\[...]
(e) A person who is a debtor under a security agreement, and
who does not have a right to sell or dispose of the secured property
or is required to account to the secured party for the proceeds of a
permitted sale or disposition, commits an offense if the person
sells or otherwise disposes of the secured property, or does not
account to the secured party for the proceeds of a sale or other
disposition as required, with intent to appropriate (as defined in
Chapter 31) the proceeds or value of the secured property. A person
is presumed to have intended to appropriate proceeds if the person
does not deliver the proceeds to the secured party or account to the
secured party for the proceeds before the 11th day after the day
that the secured party makes a lawful demand for the proceeds or
account.
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Can a common law spouse be a beneficiary of a life insurance policy?
Posted by David Leon in Contract law, Estate planning and probate, Insurance Law on 25/12/2009
Yes. A life insurance applicant may appoint anyone (or any entity) as a beneficiary on a life insurance policy, even a common law spouse. Also, if a common law marriage was in existence, then a common law spouse may have community property interests in a life insurance policy (purchased after the marriage) if the spouse is not listed as a beneficiary.
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I’ve been charged with providing a false statement to obtain credit. What exactly is this and what can they do?
Posted by David Leon in Consumer & Credit, Criminal Defense, Real Estate Law on 25/12/2009
This is a very serious offense. This is governed by Texas Penal Code Sec. 32.32. The more common activities include falsely stating an inflated income on a mortgage application, or falsely increasing your income to obtain a loan. Either way, if the amount of credit granted as a result of a false statement is greater than $1,500, then the actor may be charged with a felony. Also, there may be federal charges in many cases.
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FBI releases 2008 Mortgage Fraud statistics
Posted by David Leon in Legal news and errata on 13/07/2009
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I want to force someone to pay me a debt. Can I make a letter that looks like a summons, but says it’s not in order to scare them into paying me?
Posted by David Leon in Consumer & Credit, Criminal Defense on 05/07/2009
No, this is a criminal offense under the Texas Penal Code Sec. 32.48. Under subsection (c) it is NOT a defense if the document states that it is not legal process.
First offense is a misdemeanor (class A), second one is a felony (state jail).
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What are the penalties for making false statement on a mortgage application?
Posted by David Leon in Criminal Defense, Real Estate Law on 29/06/2009
The penalties under 32.32(c) are as follows:
(1) a Class C misdemeanor if the value of the property or the amount of credit is less than $50;
(2) a Class B misdemeanor if the value of the property or the amount of credit is $50 or more but less than $500;
(3) a Class A misdemeanor if the value of the property or the amount of credit is $500 or more but less than $1,500;
(4) a state jail felony if the value of the property or the amount of credit is $1,500 or more but less than $20,000;
(5) a felony of the third degree if the value of the property or the amount of credit is $20,000 or more but less than $100,000;
(6) a felony of the second degree if the value of the property or the amount of credit is $100,000 or more but less than $200,000; or
(7) a felony of the first degree if the value of the property or the amount of credit is $200,000 or more.
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What is a pyramid scheme?
Posted by David Leon in Business law, Criminal Defense, Franchise Law on 27/06/2009
A pyramid scheme (a/k/a franchise fraud) is an investment fraud scheme in which someone is offered a distributorship or franchise to market a particular product. This involves a fee to become part of the business. The real profit is earned by the sale of new distributorships and not by the sale of the products. Typically, the scheme is sold by telling new subscribers that they can remake their original investment by selling distributorships to two or more people, and so on. Soon, the lower levels of the pyramid are unable to find more people to buy into the scheme, and the scheme collapses. (Source: FBI )
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What is a ‘liar loan’?
Posted by David Leon in Criminal Defense, Foreclosure, Real Estate Law on 27/06/2009
A ‘liar loan’ is a nickname for a ‘stated income’ loan. These loans were popular from 2000-2007. They were also called ‘no-doc’ and ‘non-verfied’ or ‘streamlined’ loans. Basically, with these loans, a bank or mortgage company would simply ask a borrower what his or her income was, and offer loan products based on the person’s statement of income. The banks usually did not verify the person’s ‘stated’ income. In some cases, people were overstating their income to qualify for houses they couldn’t afford. The typical hope was that the person could use a short term ARM loan or teaser loan to keep the house (and mortgage) afloat for a year or so, and then sell the house for a profit due to the rising house values. Once home values stopped rising, people’s ARMs adjusted upward, or the teaser rates ended, and the people wound up with homes they couldn’t afford. The practice of overstating income on a ‘liar loan’ is a criminal offense, per Texas Penal Code Sec. 32.32.
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I verified employment for a friend who doesn’t work for me, so he could buy his house. Should I be worried?
Posted by David Leon in Criminal Defense, Real Estate Law on 27/06/2009
Yes. This is a violation of Texas Penal Code Sec. 32.32, among other offenses. These can carry with them significant criminal responsibility. Even though you may not have signed the credit application yourself, you may have “acted in concert” with the person committing fraud. You should obtain legal counsel immediately.
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What is a teaser rate loan?
Posted by David Leon in Foreclosure, Real Estate Law, loan modifications on 27/06/2009
A teaser rate loan is a nickname for ARM loans and interest only loans. A typical teaser rate is a loan in which the borrower pays only interest on the loan for the first few years. After that, the “teaser” is over, and the regular rate (interest plus principal) kick in, usually with a high interest rate. These loans were widely used by speculating investors and credit investors. The thinking was that one could buy a house, pay interest on it for a year or two (while the land appreciated in value) and then “flip” the house at a profit. When housing prices failed to keep rising as expected, the teaser rates ended, leaving borrowers with very large house payments that they could not afford.
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I want to buy a house, but have bad credit. Someone told me that I could buy a house in someone else’s name. Is this possible?
Posted by David Leon in Real Estate Law on 21/06/2009
Yes, you can buy a house “in someone else’s name.” However, that person will OWN your house. There are many people out there who believe they own a house that they bought “in someone else’s name.” However, when there is a problem, they quickly learn that “someone else’s name” means “someone else’s name.” Unfortunately, in many cases, they just paid for someone else’s house.
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I want to sell a used watch. Do I have to disclose that the watch is used to the customer?
Posted by David Leon in Business law, Contract law, Criminal Defense on 25/05/2009
Yes. Title 2, Chapter 17 Subchapter C of the Texas Business and Commerce Code deals specifically with the selling of secondhand watches in the state. Not only must the watch be clearly labeled “secondhand” (17.21) but accurate records must also be maintained under Sec. 17.20. Failure to comply is a crime under Sec. 17.22.
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I want to start a new business. In order to attract customers, can I call my business a “wholesaler” even though I sell to the public?
Posted by David Leon in Business law on 25/05/2009
No. If you are not a wholesaler, you cannot advertise your business as a ‘wholesale’ business. Sec. 17.11 of the Texas Business and Commerce Code specifically prohibits this, as this would be a deceptive trade practice. This type of behavior is a misdemeanor. The statute provides:
DECEPTIVE WHOLESALE AND GOING-OUT-OF-BUSINESS ADVERTISING. (a) In Subsection (b) of this section, unless the context requires a different definition, “wholesaler” means a person who sells for the purpose of resale and not directly to a consuming purchaser.
(b) No person may wilfully misrepresent the nature of his business by using in selling or advertising the word manufacturer, wholesaler, retailer, or other word of similar meaning.
…
(d) A person who violates a provision of Subsection (b) or (c) of this section is guilty of a misdemeanor and upon conviction is punishable by a fine of not less than $100 nor more than $500.
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How do I know if the life insurance policy is community property or separate property?
Posted by David Leon in Estate planning and probate, Insurance Law on 01/03/2009
If the initial premium was paid out of community funds, the life insurance policy may be a community asset. This means that one half of the policy “belongs” to the surviving spouse. If a third person is named beneficiary of a community owned life insurance policy, and the surviving spouse did not sign a waiver, then the surviving spouse may challenge the beneficiary designation. If naming the other person is found to be a fraud on the surviving spouse, the spouse may be awarded a share of the death benefits and the named beneficiary will be entitled to receive the remainder. If you have an insurance issue that you would like to discuss, please contact us.
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I am an appraiser. A lender asked me to appraise a property higher than normal. Is this a crime?
Posted by David Leon in Criminal Defense, Real Estate Law on 15/02/2009
Possibly. The Business & Commerce Code provides “A lender commits an offense if in connection with a mortgage loan transaction the lender pays or offers to pay a person, including an individual licensed or certified by the Texas Appraiser Licensing and Certification Board or the Texas Real Estate Commission, a fee or other consideration for appraisal services and the payment:
(1) is contingent on a minimum, maximum, or pre-agreed estimate of value of property securing the loan; and
(2) interferes with the person’s ability or obligation to provide an independent and impartial opinion of the property’s value.”
There is an exception if the lender offers legal information concerning the appraisal.
(See: Sec. 103.002 of the Texas Bus. & Commerce Code CRIMINAL PENALTY.)
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I sold my house to a company for a low price, and they agreed to lease it back to me. Can I get my house back?
Posted by David Leon in Contract law, Real Estate Law on 15/02/2009
Possibly. Texas Property Code provides that the taking of a deed under these circumstances may be considered a deceptive trade practice. Accordingly, the deed may be void and no lien would attach to the homestead property as a result of the purported sale.
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A company offered to buy my house at a discount and then rent it back to me.
Posted by David Leon in Contract law, Real Estate Law on 15/02/2009
First, if the house is mortgaged, then the transfer of the interest in the property may violate the mortgage’s “due on sale” clause. This means that the mortgage company has the option to call the entire amount of the loan due and payable. Further, such a transaction, may be considered to be a loan, if the house was sold at less than fair market value. This means that all payments made from the seller to the buyer in excess of the sales price will considered to be interest subject to the Texas Finance Code. These cases tend to be fact specific, Contact Us if you wish to discuss.
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What is money laundering?
Posted by David Leon in Criminal Defense on 05/01/2009
Money laundering is the act of making money that came from an illegal source appear to have come from a legitimate source.
Money laundering in Texas is covered by chapter 34 of the Texas Penal Code. Put simply, handling (or supervising the handling of) money derived from (or used to further) illegal activity. It is not a defense if the person charged with handling the money doesn’t know of the exact nature of how the funds were obtained, just that such funds were used in or profits from an illegal act.
The penalties can be severe, and may include substantial jail time.
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What is hindering a secured creditor?
Posted by David Leon in Criminal Defense, Real Estate Law on 21/12/2008
Section 32.33 of the Texas Penal Code covers Hindering a Secured Creditor. Section (b) of the code states, “A person who has signed a security agreement creating a security interest in property or a mortgage or deed of trust creating a lien on property commits an offense if, with intent to hinder enforcement of that interest or lien, he destroys, removes, conceals, encumbers, or otherwise harms or reduces the value of the property.” This can also involve moving the property out of state to avoid having a creditor repossess it (see Section 32.33(1)).
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Is it a crime to overstate your income on a mortgage application?
Posted by David Leon in Criminal Defense, Real Estate Law on 21/12/2008
Yes. Chapter 32 of the Texas Penal Code deals with Fraud. Specifically, Section 32.32 (b) of the Texas Penal Code (FALSE STATEMENT TO OBTAIN PROPERTY OR CREDIT) states “A person commits an offense if he intentionally or knowingly makes a materially false or misleading written statement to obtain property or credit, including a mortgage loan.” You need to be very careful when completing credit applications to ensure every state that you make is as accurate as possible. The penalties can be very severe, and may include substantial jail time.
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