Home on the Line: I-Team investigation sparks lawsuits, renewed fraud task force, and calls for stronger homeowner protections
PALM DESERT, Calif. (KESQ) — What began as one Coachella Valley woman's fight to regain control of her home has grown into a statewide conversation about whether California homeowners have enough protection when signing real estate documents online.
Last month, the KESQ I-Team introduced viewers to 85-year-old Jessie Schumaker, a Palm Desert homeowner who believed she was simply requesting information from an online "cash for houses" company.
Instead, she found herself caught in a legal dispute over her home.
"This is all I have," Schumaker told the I-Team during our first investigation.
After the I-Team began asking questions and contacted attorney Matthew Corsaut, who represents Evergreen Capital LLC, the legal disputes involving Schumaker's property were dismissed or resolved, allowing her to move forward.
For Schumaker, the ordeal is over.
For the I-Team, it was just the beginning.
Viewers across California came forward
Almost immediately after our first investigation aired, emails began pouring into the I-Team inbox.
Homeowners.
Attorneys.
Financial advisors.
Real estate professionals.
Many described different situations, but raised remarkably similar concerns involving online real estate transactions and electronic signatures.
Those emails led to weeks of additional reporting, including reviewing lawsuits, corporate filings, licensing records and court documents.
One email came from Ira Frazer, a California attorney and homeowner who is now suing Evergreen Capital LLC.
Frazer says Evergreen agreed to purchase his La Jolla home for $2.2 million. After both sides signed a contract, he says the company attempted to renegotiate the purchase price.
"They're saying we cannot pay you 2.2. How much would you take less? I said, no, the price is 2.2. I told you that we have a signed contract."
Frazer says the transaction eventually collapsed. He has since filed a lawsuit seeking damages.
"I was made a fool by this. It's a matter of principle. If I sign a contract, I have to live by my word. If they sign a contract... they should have to honor it."
Evergreen Capital LLC has denied wrongdoing in court filings in Frazer's case, and the litigation remains pending.
Investigation prompts discussion among Realtors
The I-Team also shared its findings with Paul Herrera, Government Affairs Director for the Inland Valleys Association of REALTORS®.
After watching the investigation, Herrera presented the story to approximately two dozen Realtors and brokers during a Housing Policy Committee meeting, asking whether they were seeing similar situations involving homeowners.
The response surprised him.
"The ubiquity of it surprised me."
Herrera says once the discussion began, Realtors from around the room began sharing similar experiences involving clients.
"Once one started, then the stories came in from all directions."
Within minutes, the group proposed reviving the Real Estate Fraud Advisory Team, a collaborative working group that previously brought together Realtors, the Riverside County District Attorney's Office, title companies, escrow professionals and other agencies to identify emerging fraud trends.
According to Herrera, that group previously helped identify problems involving California's PACE financing program.
He says those discussions eventually contributed to legislation, investigations, consumer protection efforts and recovery programs.
The association is now working with county officials, state agencies and lawmakers to restart the group.
Concerns reach Sacramento
The investigation has also drawn the attention of Assemblymember Greg Wallis, who recently hosted a Senior Scam Stopper seminar in Palm Desert.
After watching the I-Team investigation, Wallis said he was surprised by how quickly an electronic signature could potentially affect a homeowner's property rights.
"I couldn't believe it could happen like that... It's really important that we create awareness around that."
Wallis acknowledged there may be gaps in current law as technology continues to evolve.
"The Legislature has a responsibility here, and we need to figure out how we can close those gaps."
He says lawmakers are now working with Realtors, consumer advocates and government agencies to examine possible policy changes aimed at better protecting California homeowners.
The investigation continues
What began with one homeowner asking the I-Team for help has now expanded into:
- New lawsuits
- Renewed conversations about consumer protection
- A revived Real Estate Fraud Advisory Team
- Discussions about possible legislative changes in California
Frazer's lawsuit remains pending, and he says he intends to continue pursuing the case.
"No one should be allowed to pick on people and do this."
The I-Team will continue following the pending litigation, the proposed legislation and the efforts to restart the Real Estate Fraud Advisory Team.
If you've experienced a similar issue involving an online real estate transaction, we'd like to hear from you.
Email the I-Team: ITeam@KESQ.com
