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Florida Foreclosure Surplus Funds – What do You do When Your Surplus Funds Were Taken by Fraud?

I received a call today from someone who was seeking Florida Foreclosure Surplus Funds from the foreclosure sale of his property. However, he stated that when he contacted the Clerk for his County, they told him the funds had already been retrieved by a third-party surplus recovery company. He was able to get the documents from the Clerk and contacted the Attorney that had handled the case for the third-party surplus recovery company, and she stated she had been working for the company and followed their directions. They had given her supposed legitimate documents regarding the assignment of the rights to the funds and she filed on their behalf.

Understandably this gentleman was upset because there was over $250,000 in Florida Foreclosure Sale Surplus Funds that he should have gotten, but the third-party surplus recovery company had fraudulently signed his name to documents, manufactured identifications and got their attorney to get them the funds before anyone knew what was going on. He tried reaching out to this company, but of course they had disappeared. He contacted me wondering what he could do at this point. There isn’t much that can be done unless this company can be tracked down.

Florida Statute, 45.033(1) states in part, “A person claiming a legal right to the surplus as an assignee of the rights of the owner of record must prove entitlement to the surplus funds.” The third-party surplus recovery company must provide proof they have been assigned the rights to the surplus funds. Generally, this is by way of providing a contract for their “services”, signed by both parties. When their attorney makes a claim for the Florida Foreclosure Sale Surplus Funds, they will also provide the contract to the court. How is the court supposed to know if this contract is legitimate? It can be very difficult to do so.

In fact, there was a South Florida attorney a couple of years ago who was arrested and charged with this sort of fraud ring. She was later disbarred and is no longer allowed to practice law in the State of Florida. This is one of the many, many reasons I feel it is important to never work with one of these shady third-party surplus recovery companies. You never know if they are legitimate or not. If an attorney simply files the paperwork for one of these companies and never speaks to the former homeowner, do they really know who it is they are representing? And by virtue of the assignment of rights the attorney is now only representing the third-party surplus recovery company and not the former homeowner at all.

My advice to this former homeowner that called me was to first contact the local police and report the fraud. This was for over $250,000 and is more than enough for it to be felony fraud. I don’t know if it would do any good if the company’s registered agent (if they had one) can’t be located. I don’t even know if it was a legitimate business. This former homeowner was now out a great deal of money as a victim of fraud by a fraudulent third-party surplus recovery company. I also recommended he contact the Florida Bar and report the attorney who filed the Florida Foreclosure Sale Surplus Funds case with the court. This attorney should have done her due diligence and at least attempted to contact the person who supposedly assigned their rights to the surplus recovery company. This could potentially put this attorney’s bar license in jeopardy simply because this third-party surplus recovery company chose to use her for their fraudulent scheme.

I get calls every week from different third-party surplus recovery companies or people who are trying to get into the business of Florida Foreclosure Sale Surplus Funds, and I always tell them no, I won’t work with them. It is always my practice to ONLY work with the former homeowner or with the family members of a deceased homeowner. When I do so, I am representing them as their attorney. You will never sign over your rights to me for Florida Foreclosure Sale Surplus Funds. I also get calls every week from former homeowners or family members who have signed their rights over to a surplus recovery company after they realize what a scam it is. I feel very sorry for them, but often I am not able to help them get out of the contract. Once their rights are assigned over, it may be too late. And if that company decides to skip town? What can you do? Report the fraud to the police. Maybe they will be found, maybe they won’t. It is far safer to hire a qualified Florida Foreclosure Sale Surplus Funds attorney who will represent you directly and is beholden to the ethics of the Florida Bar.

If you or a deceased family member have lost a property to foreclosure and you believe there are Florida Foreclosure Sale Surplus Funds available, please give me a call for a free consultation. I handle Foreclosure Sale Surplus Funds and Tax Deed Sale Surplus Funds in every County in the State of Florida. I can evaluate your case and make sure you get the most funds coming to you. And I don’t get paid unless you do.

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