In a story released today by USA Today, we learned about a new fraud that had been taking place in Virginia, where investors were tricked into signing documents to purchase properties that had been appraised at inflated values.
Countrywide Financial, who is suing the man who allegedly orchestrated the fraud, Robert Penn, “claims the defendants duped their victims by inviting them to take part in either an “investment opportunity” or a “real estate investment club.”
The lawsuit alleges the paperwork that truck drivers, retirees, factory workers and others in or around Martinsville, Va., signed eventually made them “straw borrowers” liable for bogus loans for one or more homes obtained by submitting false mortgage applications.
The victims were not given copies of the “investment” documents and were rushed into signing them after being told they needed to be quickly delivered to Indianapolis, the lawsuit claims.
“The straw borrowers were not asked to read the documents they signed, and in some cases were told there was no time for such a read, or that it was unnecessary,” the lawsuit states.
There are hundreds of legitimate real estate investment clubs that serve to educate and assist investors, but this story should serve as a warning to be careful when dealing with all potential investment opportunities.
NEVER SIGN SOMETHING BEFORE READING IT!
If someone rushes you to sign something before they let you have a look at it, they are probably not having you sign something you want to sign. This may seem obvious, but any legitimate person you will deal with understands the importance of due diligence, and will give you adequate time to review any related documents and paperwork.
Be careful America . . .