How the scam works:
In the United States, a Sheriff’s sale is the last step in a foreclosure process.
It is an auction held to liquidate a property on which a mortgage borrower has defaulted-- it allows banks to recover money lost when a mortgage borrower defaults on a loan.
Crooks create companies with the claim that they will assist former owners of properties sold at Sheriff’s sales, promising victims they will help them recover their properties or the proceeds from the auction. There are some legitimate companies that provide these services, but it's a matter of separating the real ones from the fake ones.
Not only do the scammers charge former owners an up-front fee, providing nothing in return, but they ask for driver license photocopies and personal info as well.
It has been reported that fraudsters alter the driver licenses and submit them to title companies with fake Power of Attorney documents, in order to steal Sheriff’s sale proceeds due to other former property owners.
How to avoid:
Don’t fall for such a thing. Never pay any fees up front.
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