Illinois General Assembly - Full Text of HB2832
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Full Text of HB2832  98th General Assembly

HB2832enr 98TH GENERAL ASSEMBLY

  
  
  

 


 
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1    AN ACT concerning local government.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Counties Code is amended by adding Section
53-5010.5 as follows:
 
6    (55 ILCS 5/3-5010.5 new)
7    Sec. 3-5010.5. Fraud referral and review.
8    (a) Legislative findings. The General Assembly finds that
9property fraud, including fraudulent filings intended to cloud
10or fraudulently transfer title to property by recording false
11or altered documents and deeds, is a rapidly growing problem
12throughout the State. In order to combat the increase in the
13number of these filings, a recorder may establish a process to
14review and refer documents suspected to be fraudulent.
15    (b) Definitions. The terms "recording" and "filing" are
16used interchangeably in this Section.
17    (c) Establishment and use of a fraud referral and review
18process. A recorder who establishes a fraud referral and review
19process under the provisions of this Section may use it to
20review deeds and instruments and refer any of them to an
21administrative law judge for review pursuant to subsection (g)
22of this Section that cause the recorder to reasonably believe
23that the filing may be fraudulent, unlawfully altered, or

 

 

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1intended to unlawfully cloud or transfer the title of any real
2property. The recorder may enter into an intergovernmental
3agreement with local law enforcement officials for the purposes
4of this referral and review. A recorder may request that the
5Secretary of the Department of Financial and Professional
6Regulation assist in reviewing possible fraudulent filings.
7Upon request, the Secretary, or his or her designee, shall
8assist in identifying the validity of filings. The recorder
9shall notify the Secretary when a document suspected to be
10fraudulent is discovered.
11    In counties with a population of less than 3 million, a
12recorder shall provide public notice 90 days before the
13establishment of the fraud referral and review process. The
14notice shall include a statement of the recorder's intent to
15create a fraud referral and review process and shall be
16published in a newspaper of general circulation in the county
17and, if feasible, posted on the recorder's website and at the
18recorder's office or offices.
19    In determining whether to refer a document to an
20administrative law judge for review, a recorder may take into
21consideration any of the following factors:
22        (1) whether the owner of the property or his or her
23    designated representative has reported to the recorder
24    that another individual is attempting or has attempted to
25    record a fraudulent deed or other instrument upon the
26    property;

 

 

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1        (2) whether a law enforcement official has contacted
2    the recorder indicating that he or she has probable cause
3    to suspect title or recording fraud;
4        (3) whether the filer's name has a copyright attached
5    to it or the property owner's name has nonstandard
6    punctuation attached to it;
7        (4) whether the documents assert fines that do not
8    exist or have no basis under current law or that require
9    payment in gold or silver;
10        (5) whether the documents are maritime liens, or liens
11    under the Federal Maritime Lien Act or the Preferred Ship
12    Mortgage Act, or not authorized by the United States Coast
13    Guard;
14        (6) whether the documents are land patents not
15    authorized and certified by the United States Department of
16    the Interior Bureau of Land Management;
17        (7) whether the documents are representing that the
18    subject of the lien is releasing itself from a lien held by
19    another entity, with no apparent cooperation or
20    authorization provided by the lienholder;
21        (8) whether the documents are protesting or disputing a
22    foreclosure proceeding that are not filed within the
23    foreclosure suit and with the court presiding over the
24    matter;
25        (9) whether the documents are Uniform Commercial Code
26    filings referencing birth certificates or other private

 

 

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1    records that are not in compliance with Section 9-501 of
2    the Uniform Commercial Code;
3        (10) whether the documents are re-recording deeds to
4    re-notarize or attach notary certification if prior
5    notarization already appears unaltered on the document of
6    record;
7        (11) whether the documents are asserting diplomatic
8    credentials or immunity, non-United States citizenship, or
9    independence from the laws of the United States;
10        (12) whether the documents are claims that a bank
11    cannot hold title after a foreclosure;
12        (13) whether the documents are deeds not properly
13    signed by the last legal owner of record or his or her
14    court appointed representative or attorney-in-fact under a
15    power of attorney;
16        (14) whether the documents are manipulated or altered
17    federal or State legal or court forms that release a lien;
18        (15) whether a document is not related to a valid
19    existing or potential adverse transaction, existing lien,
20    or judgment of a court of competent jurisdiction;
21        (16) a document that is not related to a valid existing
22    or potential commercial or financial transaction, existing
23    agricultural or other lien, or judgment of a court of
24    competent jurisdiction;
25        (17) whether the document is filed with the intent to
26    harass or defraud the person identified in the record or

 

 

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1    any other person;
2        (18) whether the document is filed with the intent to
3    harass or defraud any member of a governmental office,
4    including, but not limited to, the recorder's office, local
5    government offices, the State of Illinois, or the Federal
6    government; and
7        (19) whether the documents are previous court
8    determinations, including a previous determination by a
9    court of competent jurisdiction that a particular document
10    is fraudulent, invalid, or forged.
11    (d) Determinations. If a recorder determines, after review
12by legal staff and counsel, that a deed or instrument that is
13recorded in the grantor's index or the grantee's index may be
14fraudulent, unlawfully altered, or intended to unlawfully
15cloud or transfer the title of any real property, he or she
16shall refer the deed or instrument to an administrative law
17judge for review pursuant to subsection (g) of this Section.
18The recorder shall record a Notice of Referral in the grantor's
19index or the grantee's index identifying the document,
20corresponding document number in question, and the date of
21referral. The recorder shall also notify the parties set forth
22in subsection (e) of this Section. The recorder may, at his or
23her discretion, notify law enforcement officials regarding a
24filing determined to be fraudulent, unlawfully altered, or
25intended to unlawfully cloud or transfer the title of any real
26property.

 

 

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1    (e) Notice. The recorder shall use county property tax
2records to identify and provide notice to the last owner of
3record by telephone, if available, and certified mail both
4when: (1) a deed or instrument has been referred for review and
5determination; and (2) a final determination has been made
6regarding the deed or instrument. Notice, by mail, shall also
7be sent to the physical address of the property associated with
8the deed or instrument.
9    (f) Administrative decision. The recorder's decision to
10add a Notice of Referral and refer a document for review is a
11final administrative decision that is subject to review by the
12circuit court of the county where the real property is located
13under the Administrative Review Law. The standard of review by
14the circuit court shall be de novo.
15    (g) Referral and review process. Prior to referral, the
16recorder shall notify the last owner of record of the document
17or documents suspected to be fraudulent. The person, entity, or
18legal representative thereof shall confirm in writing his or
19her belief that a document or documents are suspected to be
20fraudulent and may request that the recorder refer the case for
21review. Upon request, the recorder shall bring a case to its
22county department of administrative hearings and, within 10
23business days after receipt, an administrative law judge shall
24schedule a hearing to occur no later than 30 days after
25receiving the referral. The referral and case shall clearly
26identify the person, persons, or entity believed to be the last

 

 

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1true owner of record as the petitioner. Notice of the hearing
2shall be provided by the administrative law judge to the filer,
3or the party represented by the filer, of the suspected
4fraudulent document, the legal representative of the recorder
5of deeds who referred the case, and the last owner of record,
6as identified in the referral.
7    If clear and convincing evidence shows the document in
8question to be fraudulent, the administrative law judge shall
9rule the document to be fraudulent and forward the judgment to
10all the parties identified in this subsection. Upon receiving
11notice of the judgment of fraud, the recorder shall, within 5
12business days, record a new document that includes a copy of
13the judgment in front of the Notice of Referral that shall
14clearly state that the document in question has been found to
15be fraudulent and shall not be considered to affect the chain
16of title of the property in any way.
17    If the administrative law judge finds the document to be
18legitimate, the recorder shall, within 5 business days after
19receiving notice, record a copy of the judgment.
20    A decision by an administrative law judge shall not
21preclude a State's attorney or sheriff from proceeding with a
22criminal investigation or criminal charges. If a county does
23not have an administrative law judge that specializes in public
24records, one shall be appointed within 3 months after the
25effective date of this amendatory Act of the 98th General
26Assembly, or the original case shall be forwarded to the proper

 

 

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1circuit court with jurisdiction.
2    Nothing in this Section precludes a private right of action
3by any party with an interest in the property affected by the
4review and referral, or the filer of the document or documents
5suspected to be fraudulent. Nothing in this Section requires a
6person or entity who may have had a fraudulent document or
7encumbrance filed against his or her property to use the fraud
8review and referral process or administrative review created by
9this Section.
10    (h) Fees. The recorder shall retain any filing fees
11associated with filing a deed or instrument that is determined
12to be fraudulent, unlawfully altered, or intended to unlawfully
13cloud or transfer the title of any real property under this
14Section.
15    (i) Liability. Neither a recorder nor any of his or her
16employees or agents shall be subject to personal liability by
17reason of any error or omission in the performance of any duty
18under this Section, except in case of willful or wanton
19conduct. Neither the recorder nor any of his or her employees
20shall incur liability for the referral or review, or failure to
21refer or review, a document or instrument under this Section.
22    (j) Applicability. This Section applies only to filings
23provided to the recorder on and after the effective date of
24this amendatory Act of the 98th General Assembly.
25    (k) This Section is repealed June 1, 2018.
 
26    Section 99. Effective date. This Act takes effect upon

 

 

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1becoming law.