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Rep. Tlaib, Detroit officials demand action after ‘fake landlord’ scam exposed

DETROIT — Public officials and leaders in Detroit are calling for policy changes and programs to protect residents from the “fake landlord” scam. 

A four-month investigation by NBC News and Outlier Media found that the scam — in which con artists rent or sell homes they don’t own — affects as many as 1 in 10 Detroit tenants facing eviction. But culprits rarely face consequences, in part because they often use fake names and IDs and because many victims don’t alert police, authorities say.

“These are folks that are blatantly in our face, targeting our residents and taking their money,” said U.S. Rep. Rashida Tlaib, a Democrat whose district includes Detroit, where she often sees flyers posted by people she believes are scammers offering to sell houses for cash.  

“The response needs to be with a sense of urgency,” she said. “People need to care about our residents that are getting victimized and targeted like this.”

The NBC News/Outlier Media investigation found that the scam has flourished in the wake of tens of thousands of mortgage and tax foreclosures that have left many Detroit homes vacant or in the hands of out-of-town investors. Foreclosures have destabilized the housing landscape in the city, making it difficult for residents to know who owns their homes. 

At the same time, discriminatory lending policies have made it difficult for Detroiters — most of whom are Black and live in neighborhoods with low property values — to secure traditional mortgages, which means they don’t get protections that lenders bring to homebuying, such as title searches.

Tlaib has sponsored legislation that she believes could help stabilize housing in cities like Detroit, including a bill to improve access to mortgages for people borrowing less than $70,000. The bill passed the House last spring and is up for consideration by the Senate. 

Other elected officials in Michigan called for efforts at the state and local levels to protect Detroiters, including City Council President Pro Tempore Mary Sheffield, who said she’ll propose funding housing education programs in the city’s budget process early next year. 

“Maybe a mailing or something to residents letting them know what’s happening,” she said, “some general pointers of what to look out for, what to avoid, how to know if a deed is real.”

City officials noted that two programs are already in the works that could help educate residents. One is a foreclosure prevention effort that, beginning as soon as next month, will send canvassers to thousands of houses that are in danger of tax foreclosure. Canvassers will inform residents of a city initiative that enables renters to buy houses before they fall into foreclosure, and they could answer other questions about housing. 

The city also recently began a pilot program with six community organizations to provide neighborhood-based housing counseling. 

“These are trusted organizations in their neighborhoods,” said Julie Schneider, who leads the city’s Department of Housing and Revitalization. “It’s part of an effort to make sure that Detroiters are getting the best information they can about housing.” 

June Walker, 65, the grandmother whose story was featured in the NBC News/Outlier Media report last week, said she wished she’d had a place to turn for advice before she signed a contract with someone she later discovered was scamming her. 

June Walker, 65, sits outside her home in Detroit.Sylvia Jarrus for NBC News

Walker made payments totaling $15,000 over two years to buy a brick bungalow on the city’s east side. She celebrated her final payment in April but learned two months later, when an eviction letter arrived, that the man she was paying wasn’t the property manager he claimed to be. 

Her home’s real owner — a Florida company called Boccafe LLC, which bought the house last spring for $25,000 — says Walker is a trespasser and wants her out. 

At an eviction hearing over Zoom last Friday, a judge postponed a ruling on her case until at least January. Walker’s lawyer hopes that will give her time to negotiate the purchase of her house — for real this time.  

“There has been quite a bit of publicity concerning this case, which has drawn donations from across the country,” Marilyn Mullane, Walker’s lawyer, told Judge Alicia Jones-Coleman of Detroit’s 36th District Court during the hearing. 

The assistance, Mullane said, means Walker could potentially have the resources to buy the house from Boccafe.

Randy LeVasseur, an attorney for Boccafe, expressed reluctance at the hearing to discuss a sale five months after his client filed its eviction case. He said Walker and her lawyers hadn’t turned over evidence of the scam until just before the hearing, and he asked Jones-Coleman to confirm that Boccafe is the owner of the house — not Walker — before entering into sale negotiations.  

“At this late juncture, it’s not the time to start exploring,” LeVasseur told Jones-Coleman. “It’s time for a determination that the plaintiff is entitled to possession.”

LeVasseur didn’t respond to requests for comment after the hearing.

The owners of Boccafe, Carlos Alberto Garbesi and Alejo Carlos Garbesi, didn’t respond to requests for comment sent by social media and to an Argentine email address that was listed in Florida business records in connection with the company. 

Records show Boccafe owns 15 properties in Detroit that it bought mostly within the last two years. Walker’s house is one of three that Boccafe bought in June from a Pennsylvania company called RHMS Group, which owns nearly 70 properties around the city. 

RHMS Group, which bought Walker’s house in a 2017 tax auction, was the owner when she moved in. RHMS Group’s president said he believed the house was vacant from 2018 until he sold it this year. 

Several state lawmakers said they’re pursuing legislative changes that could cut down on housing fraud. 

A vacant home in Detroit. Sylvia Jarrus for NBC News

Rep. Cynthia Johnson, a Democrat, said she’s looking for ways to hold out-of-state investors accountable for what happens in their homes and to require landlords to be publicly registered. 

Rep. Shri Thanedar, a Democrat whose district includes Walker’s neighborhood, said he’s exploring the legality of requiring homeowners to post plaques with ownership information on their homes. 

And state Sen. Adam Hollier, also a Democrat who represents Walker’s neighborhood, said he’s focused on expanding affordable housing. 

“The reason that people are in this situation is not because they’re easy marks,” Hollier said. “It’s because their options are limited.”  

Law enforcement agencies, meanwhile, encouraged victims to file police reports. 

“Scammers are typically not held accountable because many victims do not come forward,” the Detroit Police Department said in a statement, noting that Walker hadn’t filed a police report until this week. 

Walker said her lawyers initially advised her to hold off on filing a report until they could gather more information. She filed a report Thursday, she said. Other victims said they didn’t complain because they feared retaliation from their scammers or were too overwhelmed by the need to find new housing.

Michigan Attorney General Dana Nessel this week reissued consumer alerts to help protect people from the scam and encouraged victims to file fraud complaints with her office. 

“I was appalled and saddened to read the hardship these victims are facing at the hands of scam artists who target tenants,” Nessel said in a news release in response to the NBC News/Outlier Media investigation.

She encouraged homebuyers to apply for Federal Housing Administration mortgages, which have low down payments and are federally insured, and to use licensed loan agents. She also urged people to carefully read documents and to get all promises in writing.  

Detroit police added that people should always get contracts or leases and should verify properties’ owners, either on the city’s website or by visiting the county’s Register of Deeds, before buying or renting homes.

Walker said she remains hopeful that she’ll be able to stay in her house, but she noted that she’s not the only person who needs help. 

“It’s not just about me,” she said, calling on authorities to investigate scammers. “How many people just in Detroit alone have been played like that? It is time for something to be done.”

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