Here's the scheme, step-by-step:
- True owner of the property, "Good Realty LLC" allows its charter to lapse with the Maryland State Department of Assessments and Taxation.
- Mr. Kutchera, the title squatter, identifies the property and forms a new entity, called "Good Realty, LLC." Notice the slight change in the name, by adding a comma after "Realty."
- Mr. Kutchera entices a settlement company to assist in the transfer of title to the property from "Good Realty" into his other entity, Acuity Real Estate Investments, LLC.
- Mr. Kutchera and Acuity then sell the property to an unsuspecting purchaser, who intends to renovate the property and place it on the rental market.
- Mr. Kutchera and Acuity take back owner financing for all but closing costs and the purchaser's deposit.
- True owner wakes up and sues buyer, alleging that she bought nothing from a thief. And he's right.
What was particularly galling about this case was Mr. Kutchera's early demands for payment under the owner financed deed of trust, and his threats of foreclosure. It didn't take much to demonstrate the true fraud to Mr. Kutchera's lawyer, who then withdrew from the engagement.
I suspect that this form of fraud is not limited to this case, and the one being handled by another lawyer. And if Mr. Kutchera is doing it, then there are surely others engaged in the same scheme.