The Contra County District Attorney's Office Real Estate Fraud Unit investigates and prosecutes serious and significant cases involving fraudulent transactions that can cause unsuspecting victims to lose their life savings and homes. This Unit is funded in part by the fee on Real Estate documents assessed by the Contra Costa County Clerk-Recorder's Office. Given the current economic climate and the collapse of the real estate and credit markets, we have received an increasing number of complaints of egregious fraud committed on homeowners, including foreclosure fraud. The current economic situation is ripe for crooks and thieves who prey on the financial difficulties of homeowners. The proposed additional fee imposed upon real estate documents will assist our efforts to protect the citizens of Contra Costa County and ensure the safety and continuity of their home ownership.
Section 27388 of the Government Code, relating to local government, allowed for the establishment of a Real Estate Fraud Prosecution Trust Fund. The program was established in the District Attorney's Office budget and recording fees were established for real estate instruments, paper, and notices, with fees set at $2 per instrument. Monies collected by the Clerk-Recorder's Office are currently, and shall continue to be, deposited into the interest bearing Real Estate Fraud Prosecution Trust Fund (Fund No. 113300) for the sole purpose of prosecution and investigation of real estate fraud.
Senate Bill (SB) No. 1396 was approved by the Governor of California and filed with the Secretary of State on September 27, 2008. SB1396 authorizes a county Board of Supervisors to impose a fee of up to $3 to be paid at the time of recording every real estate instrument, paper, or notice required or permitted by law to be recorded within that county, except those expressly exempted from payment of recording fees.
A "real estate instrument" was previously defined as a deed of trust, an assignment of deed of trust, a reconveyance, a request for notice, and a notice of default. SB 1396 broadens the definition than previously applied to include a substitution of trustee, a notice of trustee sale, and a notice of rescission of declaration of default. It does not include any deed, instrument, or writing subject to the imposition of a documentary transfer tax as defined in Section 11911 of the Revenue and Taxation Code, nor any document required to facilitate the transfer subject to the documentary transfer tax. Funds from the Real Estate Fraud Prosecution Trust Fund shall be used only in connection with the criminal investigations or prosecutions involving recorded real estate documents.
It should be noted that the County Clerk-Recorder began collecting increased fees of $3 on certain real estate instruments and imposed a new fee of $3 on additional real estate instruments pursuant to SB 3976 beginning on January 1, 2009.