Home Reassessment Fraud

What is it about a sluggish economy that causes the vultures to circle, trying to profit from other people's misfortune? I'm not talking about the opportunists who see money to be made from cleaning foreclosed homes, or scoring a good deal on an investment. I'm talking about con artists the likes of Bernard Madoff, and the current wave of scams directed at distressed homeowners. Recently, we've seen the "foreclosure rescue" scams, "short sale facilitation" scams, and "loan modification" scams. Now, the West Coast is experiencing a type of tax reassessment fraud, where companies, often posing as government agencies, request a fee for filing a tax assessment appeal.

Over 500,000 single family homes purchased between July 2003 and June 2008 will have their assessments reviewed. Once complete, the homeowners will be notified of the results and at that time if they disagree with the assessment, can file an application for review. There is no charge for this review.

According to the Los Angeles County Assessor's website, "Various private companies are sending mailings to property owners offering their services to pursue a reduction in their property taxes. These companies may charge hundreds of dollars to file for a reduction in value on behalf of the property owner. Some companies are even imposing late fees if the application is received after an arbitrary deadline. Be aware that solicitations from private companies offering to pursue a reduction in property taxes must clearly indicate that they are NOT a government agency and that their services are NOT approved or endorsed by any government agency. Failure to provide such notice is a violation of California law. If you or someone you know receives an illegal solicitation, please contact the Los Angeles County Department of Consumer Affairs by phone at (800) 973-3370 or visit their dca.lacounty.gov/ website."

This is a slick operation. Apparently, the letters are being sent from address identifying itself as Property Tax Reassessment, Tax Adjusters or Tax Review, on official looking paperwork. The address is a box number and the phone number goes to an answering service. They will provide a reassessment for a charge of $179 and a $30 penalty for any requests after Feb. 26, 2009. Unassuming recipients are sending in the fees promptly to avoid the costly penalty charge. Based on different reports, the costs vary from $95 to over $200.

There is nothing illegal about charging to complete a reassessment form, but these scammers are representing themselves as a government agency and implying that the homeowner has to pay to apply for a review.

Not limited to L.A. County, similar complaints are coming from the San Francisco and San Mateo County assessor's office. At least half of the assessments that are reviewed are lowered due to declining property values, so it is well worth the effort to the homeowner to dispute the assessment. They can do this at no cost, by completing the Decline-In-Value form which is readily available (at assessor.lacounty.gov/extranet/guides/prop8.aspx )online or at one of the Assessor's (assessor.lacounty.gov/extranet/contactus/districtOffice.aspx) District Offices. Generally, the review is based on comparable properties in the area and may require some research on the part of the homeowner. If they require assistance, all they need do is contact a local realtor specializing in their area, and the information will most likely be provided free of charge.

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