Jill Bright, Chicago Title (Maricopa County)

A real estate investor we will call by the fictitious name of “Mac Aroni” contacted one of our operations as he was in need of their assistance with the purchase of several acres of vacant land in a remote desert area in Arizona.

Aroni was working directly with the seller. There were no real estate agents involved; the purchase would be for sale by owner or FSBO. The Escrow Officer set up a time for them to come to her office to open an escrow.

Aroni and two other people that we will call by the fictitious names of “Candy Steeler” and “Lynn Meabuck” met with the Escrow Officer. Steeler explained the real seller, fictitiously known as “Joshua Moron,” was unavailable since he was currently in prison. Steeler presented an Arizona quit claim deed fully executed and recorded, wherein Moron deeded the property to her. The Escrow Officer explained it would be necessary for Moron to sign a new deed since the Company generally will not rely on a quit claim deed in the chain of title.

Steeler and Meabuck were ready for the Escrow Officers objection. They presented a fully executed general power of attorney (POA) wherein Joshua Moron appointed Lynn Meabuck as his agent. The Escrow Officer knew the general POA would never be approved by her title department.

Steeler and Meabuck appeared uneasy. Their body language was making the Escrow Officer uncomfortable and suspicious. She made copies of the documents they presented, thanked them for coming in and let them know she would order a title report and get back to them with a list of requirements.

The next day, she looked over the deed and noticed the notary did not complete the notarial certificate properly. Rather than name the grantor as having appeared in front of him, he entered his own name. Next, she ran a chain of title for the property which revealed the property was owned by a family trust.

The Escrow Officer emailed Aroni, Steeler and Meabuck letting them know she would not be able to rely on the Arizona quit claim deed since the property was owned by The Smith Family Trust and not Moron. She asked them to provide her with a complete copy of the trust agreement and asked whether the original trustees were still alive.

Aroni, Steeler and Meabuck emailed her an amendment to the trust naming Joshua Moron, “…as full member and trustee and granted all rights and privileges associated with that position…with the rights to deal with real estate matters, including but not limited to buying, selling, leasing and financing…Any changes made in real property are to be done under the laws and ordinances of the governing state and county.”

How convenient. The amendment was signed by someone unknown to the Escrow Officer and clearly not one of the original trustees.

Aroni, Steeler and Meabuck also provided an unsigned document, which was the entitled certificate of trust — but it did not provide any useful or reliable information. Steeler and Meabuck said the original trustees of the family trust were deceased. The Escrow Officer was never going to rely on the amendment to the trust and felt there was more to the story.

The Escrow Officer turned to the internet and entered a search for Joshua Moron. According to Aroni, Moron was supposedly the property owner. She found a match! The information said he was serving time for embezzling $25,000 from his employer and allegedly connected to a $1.5 million fraud scheme perpetrated in California.

The Escrow Officer also checked the property taxes. They were all paid current. She noticed the tax bills were mailed to James Smith, who had a local address. She
ran a quick title search for that address and found an attorney prepared and recorded a deed from James Smith to The Smith Family Trust in 2018.

The Escrow Officer contacted the attorney, who put her in contact with James Smith. He had no clue who Moron, Aroni, Steeler and Meabuck were. James was in escrow at a sister company to sell the same property to a major builder. Moron, Aroni, Steeler and Meabuck picked the wrong person to try to steal from. James is a retired law enforcement officer. He filed a report and the case is being investigated. Moron had not learned anything and seemed to be continuing to perpetrate his schemes from prison with his cohorts.

The Escrow Officer not only protected us from a potential claim and total failure of title, she found the real property owner and was able to warn him. She observed and followed all the warning signs. The property was free and clear. She asked questions and knew better than to rely on a quit claim deed. She carefully read all the documents presented to her. Uncovered the incorrect notarial certificate on the deed.

Make sure you are doing your due diligence. Work with an Escrow Officer who is investor friendly and can help you navigate through potential sticky situations!

Article provided by contributing author:
FNTG Corporate Escrow Administrator
National Escrow Administration

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