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Public Act 098-0099


 

Public Act 0099 98TH GENERAL ASSEMBLY

  
  
  

 


 
Public Act 098-0099
 
HB2832 EnrolledLRB098 10729 OMW 41064 b

    AN ACT concerning local government.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The Counties Code is amended by adding Section
3-5010.5 as follows:
 
    (55 ILCS 5/3-5010.5 new)
    Sec. 3-5010.5. Fraud referral and review.
    (a) Legislative findings. The General Assembly finds that
property fraud, including fraudulent filings intended to cloud
or fraudulently transfer title to property by recording false
or altered documents and deeds, is a rapidly growing problem
throughout the State. In order to combat the increase in the
number of these filings, a recorder may establish a process to
review and refer documents suspected to be fraudulent.
    (b) Definitions. The terms "recording" and "filing" are
used interchangeably in this Section.
    (c) Establishment and use of a fraud referral and review
process. A recorder who establishes a fraud referral and review
process under the provisions of this Section may use it to
review deeds and instruments and refer any of them to an
administrative law judge for review pursuant to subsection (g)
of this Section that cause the recorder to reasonably believe
that the filing may be fraudulent, unlawfully altered, or
intended to unlawfully cloud or transfer the title of any real
property. The recorder may enter into an intergovernmental
agreement with local law enforcement officials for the purposes
of this referral and review. A recorder may request that the
Secretary of the Department of Financial and Professional
Regulation assist in reviewing possible fraudulent filings.
Upon request, the Secretary, or his or her designee, shall
assist in identifying the validity of filings. The recorder
shall notify the Secretary when a document suspected to be
fraudulent is discovered.
    In counties with a population of less than 3 million, a
recorder shall provide public notice 90 days before the
establishment of the fraud referral and review process. The
notice shall include a statement of the recorder's intent to
create a fraud referral and review process and shall be
published in a newspaper of general circulation in the county
and, if feasible, posted on the recorder's website and at the
recorder's office or offices.
    In determining whether to refer a document to an
administrative law judge for review, a recorder may take into
consideration any of the following factors:
        (1) whether the owner of the property or his or her
    designated representative has reported to the recorder
    that another individual is attempting or has attempted to
    record a fraudulent deed or other instrument upon the
    property;
        (2) whether a law enforcement official has contacted
    the recorder indicating that he or she has probable cause
    to suspect title or recording fraud;
        (3) whether the filer's name has a copyright attached
    to it or the property owner's name has nonstandard
    punctuation attached to it;
        (4) whether the documents assert fines that do not
    exist or have no basis under current law or that require
    payment in gold or silver;
        (5) whether the documents are maritime liens, or liens
    under the Federal Maritime Lien Act or the Preferred Ship
    Mortgage Act, or not authorized by the United States Coast
    Guard;
        (6) whether the documents are land patents not
    authorized and certified by the United States Department of
    the Interior Bureau of Land Management;
        (7) whether the documents are representing that the
    subject of the lien is releasing itself from a lien held by
    another entity, with no apparent cooperation or
    authorization provided by the lienholder;
        (8) whether the documents are protesting or disputing a
    foreclosure proceeding that are not filed within the
    foreclosure suit and with the court presiding over the
    matter;
        (9) whether the documents are Uniform Commercial Code
    filings referencing birth certificates or other private
    records that are not in compliance with Section 9-501 of
    the Uniform Commercial Code;
        (10) whether the documents are re-recording deeds to
    re-notarize or attach notary certification if prior
    notarization already appears unaltered on the document of
    record;
        (11) whether the documents are asserting diplomatic
    credentials or immunity, non-United States citizenship, or
    independence from the laws of the United States;
        (12) whether the documents are claims that a bank
    cannot hold title after a foreclosure;
        (13) whether the documents are deeds not properly
    signed by the last legal owner of record or his or her
    court appointed representative or attorney-in-fact under a
    power of attorney;
        (14) whether the documents are manipulated or altered
    federal or State legal or court forms that release a lien;
        (15) whether a document is not related to a valid
    existing or potential adverse transaction, existing lien,
    or judgment of a court of competent jurisdiction;
        (16) a document that is not related to a valid existing
    or potential commercial or financial transaction, existing
    agricultural or other lien, or judgment of a court of
    competent jurisdiction;
        (17) whether the document is filed with the intent to
    harass or defraud the person identified in the record or
    any other person;
        (18) whether the document is filed with the intent to
    harass or defraud any member of a governmental office,
    including, but not limited to, the recorder's office, local
    government offices, the State of Illinois, or the Federal
    government; and
        (19) whether the documents are previous court
    determinations, including a previous determination by a
    court of competent jurisdiction that a particular document
    is fraudulent, invalid, or forged.
    (d) Determinations. If a recorder determines, after review
by legal staff and counsel, that a deed or instrument that is
recorded in the grantor's index or the grantee's index may be
fraudulent, unlawfully altered, or intended to unlawfully
cloud or transfer the title of any real property, he or she
shall refer the deed or instrument to an administrative law
judge for review pursuant to subsection (g) of this Section.
The recorder shall record a Notice of Referral in the grantor's
index or the grantee's index identifying the document,
corresponding document number in question, and the date of
referral. The recorder shall also notify the parties set forth
in subsection (e) of this Section. The recorder may, at his or
her discretion, notify law enforcement officials regarding a
filing determined to be fraudulent, unlawfully altered, or
intended to unlawfully cloud or transfer the title of any real
property.
    (e) Notice. The recorder shall use county property tax
records to identify and provide notice to the last owner of
record by telephone, if available, and certified mail both
when: (1) a deed or instrument has been referred for review and
determination; and (2) a final determination has been made
regarding the deed or instrument. Notice, by mail, shall also
be sent to the physical address of the property associated with
the deed or instrument.
    (f) Administrative decision. The recorder's decision to
add a Notice of Referral and refer a document for review is a
final administrative decision that is subject to review by the
circuit court of the county where the real property is located
under the Administrative Review Law. The standard of review by
the circuit court shall be de novo.
    (g) Referral and review process. Prior to referral, the
recorder shall notify the last owner of record of the document
or documents suspected to be fraudulent. The person, entity, or
legal representative thereof shall confirm in writing his or
her belief that a document or documents are suspected to be
fraudulent and may request that the recorder refer the case for
review. Upon request, the recorder shall bring a case to its
county department of administrative hearings and, within 10
business days after receipt, an administrative law judge shall
schedule a hearing to occur no later than 30 days after
receiving the referral. The referral and case shall clearly
identify the person, persons, or entity believed to be the last
true owner of record as the petitioner. Notice of the hearing
shall be provided by the administrative law judge to the filer,
or the party represented by the filer, of the suspected
fraudulent document, the legal representative of the recorder
of deeds who referred the case, and the last owner of record,
as identified in the referral.
    If clear and convincing evidence shows the document in
question to be fraudulent, the administrative law judge shall
rule the document to be fraudulent and forward the judgment to
all the parties identified in this subsection. Upon receiving
notice of the judgment of fraud, the recorder shall, within 5
business days, record a new document that includes a copy of
the judgment in front of the Notice of Referral that shall
clearly state that the document in question has been found to
be fraudulent and shall not be considered to affect the chain
of title of the property in any way.
    If the administrative law judge finds the document to be
legitimate, the recorder shall, within 5 business days after
receiving notice, record a copy of the judgment.
    A decision by an administrative law judge shall not
preclude a State's attorney or sheriff from proceeding with a
criminal investigation or criminal charges. If a county does
not have an administrative law judge that specializes in public
records, one shall be appointed within 3 months after the
effective date of this amendatory Act of the 98th General
Assembly, or the original case shall be forwarded to the proper
circuit court with jurisdiction.
    Nothing in this Section precludes a private right of action
by any party with an interest in the property affected by the
review and referral, or the filer of the document or documents
suspected to be fraudulent. Nothing in this Section requires a
person or entity who may have had a fraudulent document or
encumbrance filed against his or her property to use the fraud
review and referral process or administrative review created by
this Section.
    (h) Fees. The recorder shall retain any filing fees
associated with filing a deed or instrument that is determined
to be fraudulent, unlawfully altered, or intended to unlawfully
cloud or transfer the title of any real property under this
Section.
    (i) Liability. Neither a recorder nor any of his or her
employees or agents shall be subject to personal liability by
reason of any error or omission in the performance of any duty
under this Section, except in case of willful or wanton
conduct. Neither the recorder nor any of his or her employees
shall incur liability for the referral or review, or failure to
refer or review, a document or instrument under this Section.
    (j) Applicability. This Section applies only to filings
provided to the recorder on and after the effective date of
this amendatory Act of the 98th General Assembly.
    (k) This Section is repealed June 1, 2018.
 
    Section 99. Effective date. This Act takes effect upon
becoming law.

Effective Date: 07/19/2013