Help with fraud

[Steve Schuck]

I am having a brain freeze this morning. I am preparing to go to small claims court and getting all my papers in order. Client (MB) wont pay because I did not get value and he feels that his client should pay since the report could not be used to close a deal. Where can I find written info on the fraud he is committing? I want to show up in court as prepared as possible. I want to present as much evidence as possible about the fraud that is being committed. Thank you in advance for your response.

 

[Terrel L. Shields]

You are not to argue fraud. Not in small claims. Simply state that your certification points out that you compensation is not contingent upon the outcome of the report and that is a requirement of the state law [that cert is required in all reports]. You would violate ethics to do so and the Mortgage broker is wrong because he knows you have to abide by those rules.

 

[Mr Rex]

I wonder if the MB refuses to pay for credit reports when the clients credit is so poor they can't get a loan?

 

[Andy Taylor]

I wonder if the MB refuses to pay for credit reports when the clients credit is so poor they can't get a loan?

This would probably be an excellent question to ask the MB. If one service provider gets paid why shouldn't another. Would probably sink their case in a heartbeat.

 

[Chris Colston]

Not fraud, but could be "breach of contract". Here in Florida, the first step in Small Claims is mediation. Both sides have their say in front of a mediator. If they can't come to an agreement then the judge gets involved.

Know (from USPAP) who the client is, have the engagement letter or the order with you and make note of where it says how you would get paid. Also note if it says anywhere, on the order, about a "direction" in value. What was the contract you had with the client regarding payment?

 

[Tudor]

Contact the AZDFI (Arizona Department of Financial Institutions), see if they have information that can help you. They have actually helped me get paid, without going to small claims.

 

[Indiana Jones]

Good points so far. As stated above, this is not a case of fraud per se; the MB is your client and they are responsible for the payment of your service. If he feels that the HO should pay for this service, that is between him and HIS client (the HO) not you and the HO.

 

[hastalavista]

I agree with the others, this is not fraud.

Do not worry too much about doing legal research; you are going to small claims court... "The Peoples' Court!"

What I would do is show that I was engaged to complete an assignment, I did complete the assignment, I presented my bill in a timely matter, and payment was refused because I did not hit a pre-determined value target.
I would then state that my regulations strictly prohibit me to complete an assignment with a pre-determined value as part of the payment stipulation. This is to insure the integrity and honesty in the appraisal system.

I'd have USPAP handy with the Ethics Rule section highlighted in case someone asked me to "prove it"!

That's it. The rest will be responding to the judge's questions, which should center around the same type of answer-
Your Honor, we cannot and should not guarantee a specific value when taking an appraisal assignment. Otherwise, there would be incentive to obtain appraisals based on pre-determined results which may or may not reflect the actual market value.

Good luck!

 

[stefan olafson]

In your report you state the client, that is who the report was completed for and that is who owes the money. Bring a copy of your appraisal, at least the page where you disclose the client and intended user(s). That should be enough to get them to pay.

The homeowner is not an intended user! USPAP is there for a reason, if we follow USPAP guidelines this is easy to present in court. No matter who pays, it's the client you do the report for.

 

[Brian Weaver]

With regard to whether an MB pays for a credit report if a deal falls apart...don't go there.

In court, never ask a question that you don't know the answer to.

Some lenders get prelim credit reports at a reduced rate.

Stick to the facts of your agreement.