Subcommittee forms work group to study deed-fraud trends and protections for property owners

The General Laws Housing Consumer Protection Subcommittee voted to adopt a substitute creating a multi-stakeholder work group to study deed fraud and to develop recommendations to prevent fraudulent conveyances.

Lawmakers said the practice of impersonating owners, preparing forged deeds and recording fraudulent transfers has grown as public land records and marketing platforms made vacant or abandoned parcels easier to find. The substitute, which the subcommittee adopted, directs the Virginia Housing Development Authority (as host for the work group) to assemble technical and stakeholder participants — including clerks of court, title and settlement professionals, real-estate trade groups, notaries, mortgage lenders and community associations — to review the scope of deed fraud, identify causation (for example, notary fraud, forged documentation, fraudulent liens), and recommend statutory or administrative safeguards.

Erin Corman of the Realtors testified in support and thanked the sponsor for convening stakeholders: ‘‘Deed fraud is a huge issue in the Commonwealth, but it covers so many different things...this study is gonna allow us to bring everybody together and really try and and attack it on a lot of different fronts,’’ she said.

The subcommittee adopted the substitute and reported the measure. Supporters said a coordinated study is needed to scope the problem, consider options such as changes to recording procedures, notary training, title-insurance practices or statutory penalties, and to recommend coordinated next steps.

The work group is charged with reporting back to the General Assembly with recommended changes and protective measures for property owners and purchasers.