On page two of Monday’s
Record there was this article, “89-year-old
loses home to fraudster.” The
Records says, “Paul Reviczky, who fled Hungary in 1957 to escape Communist persecution,
is one of the latest homeowners to discover that Ontario law favours banks, mortgage
companies and purchasers over innocent victims of fraud.” “On May 15, the property was sold on his
behalf [by one of his tenants who forged his name on a power of attorney] for
$450,000 to a purchaser who took out a mortgage of $337,500.” Ontario law recognizes the transaction as
valid where the buyer is unaware of the scam.
Why? Because otherwise the bank
would be out the $337,500 and the purchaser would be out $112,500. While I can see that the purchaser should be
protected why should this be at the original owner’s expense? It seems to me
that bank and realtor should practice due diligence and insure that the seller
is who he says he is and truly owns the property. If they haven’t done due diligence
then they should be the ones to make amends to both victims – seller and purchaser – and cover the loss. Mr. Reviczky should get his property back and
he should be compensated for his legal fees and the pain that this caused
him. This is an extremely important
issue with the emergence of the Internet and phishing and identity theft. Similar situations have occurred often enough
for insurance companies to offer “title protection” insurance when you buy a house. (I wonder if I can get such
insurance now so long after I bought.)
Fortunately “Gerry Phillips, Ontario’s minister of government services,
vowed Friday to change the land-registry system to protect homeowners like
Reviczky from title fraud.” We should
keep an eye on this issue and make sure his promise is one the Ontario Liberals
actually keep before calling an election.
Record there was this article, “89-year-old
loses home to fraudster.” The
Records says, “Paul Reviczky, who fled Hungary in 1957 to escape Communist persecution,
is one of the latest homeowners to discover that Ontario law favours banks, mortgage
companies and purchasers over innocent victims of fraud.” “On May 15, the property was sold on his
behalf [by one of his tenants who forged his name on a power of attorney] for
$450,000 to a purchaser who took out a mortgage of $337,500.” Ontario law recognizes the transaction as
valid where the buyer is unaware of the scam.
Why? Because otherwise the bank
would be out the $337,500 and the purchaser would be out $112,500. While I can see that the purchaser should be
protected why should this be at the original owner’s expense? It seems to me
that bank and realtor should practice due diligence and insure that the seller
is who he says he is and truly owns the property. If they haven’t done due diligence
then they should be the ones to make amends to both victims – seller and purchaser – and cover the loss. Mr. Reviczky should get his property back and
he should be compensated for his legal fees and the pain that this caused
him. This is an extremely important
issue with the emergence of the Internet and phishing and identity theft. Similar situations have occurred often enough
for insurance companies to offer “title protection” insurance when you buy a house. (I wonder if I can get such
insurance now so long after I bought.)
Fortunately “Gerry Phillips, Ontario’s minister of government services,
vowed Friday to change the land-registry system to protect homeowners like
Reviczky from title fraud.” We should
keep an eye on this issue and make sure his promise is one the Ontario Liberals
actually keep before calling an election.
Eric C. Bow 