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H.B. 233

             1     

MORTGAGE FRAUD

             2     
2008 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Paul Ray

             5     
Senate Sponsor: ____________

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill modifies the Utah Code to address real estate regulation, transactions, fraud,
             10      and construction.
             11      Highlighted Provisions:
             12          This bill:
             13          .    directs the attorney general to employ a real estate fraud prosecutor and two
             14      investigators;
             15          .    enacts the Real Estate Fraud Act, including:
             16              .    creating the crime of real estate fraud; and
             17              .    establishing penalties; and
             18          .    includes real estate fraud as an illegal activity under the Pattern of Illegal Activity
             19      Act.
             20      Monies Appropriated in this Bill:
             21          None
             22      Other Special Clauses:
             23          None
             24      Utah Code Sections Affected:
             25      AMENDS:
             26          76-10-1602, as last amended by Laws of Utah 2007, Chapter 129
             27      ENACTS:


             28          67-5-26, Utah Code Annotated 1953
             29          76-6-1201, Utah Code Annotated 1953
             30          76-6-1202, Utah Code Annotated 1953
             31          76-6-1203, Utah Code Annotated 1953
             32     
             33      Be it enacted by the Legislature of the state of Utah:
             34          Section 1. Section 67-5-26 is enacted to read:
             35          67-5-26. Real estate fraud prosecutor and investigators.
             36          (1) The attorney general shall employ:
             37          (a) an attorney licensed to practice law in Utah who:
             38          (i) has knowledge of the law related to real estate fraud; and
             39          (ii) if possible, has a background or expertise in investigating and prosecuting real
             40      estate fraud; and
             41          (b) at least two investigators who have a background or expertise in investigating real
             42      estate fraud.
             43          (2) (a) The attorney employed under Subsection (1)(a) has as that attorney's primary
             44      responsibility the prosecution of real estate fraud.
             45          (b) Each person employed under Subsection (1)(b) shall have as that person's primary
             46      responsibility the investigation of real estate fraud.
             47          (3) The attorney general may employ clerks, interns, or other personnel to assist the
             48      attorney employed under Subsection (1)(a).
             49          Section 2. Section 76-6-1201 is enacted to read:
             50     
Part 12. Real Estate Fraud Act

             51          76-6-1201. Title.
             52          This part is known as the "Real Estate Fraud Act."
             53          Section 3. Section 76-6-1202 is enacted to read:
             54          76-6-1202. Real estate fraud.
             55          (1) It is unlawful for any person, in connection with the offer, sale, purchase, appraisal,
             56      insurance, or financing of any real estate, whether to directly, knowingly, intentionally, or with
             57      a reckless disregard for the truth, employ any device, scheme, or artifice to defraud another or
             58      to obtain from another money, property, or anything of value by means of false or fraudulent


             59      pretenses, representations, promises, or material omissions.
             60          (2) Reliance on the part of any person is not a necessary element of this offense.
             61          Section 4. Section 76-6-1203 is enacted to read:
             62          76-6-1203. Classification of offense.
             63          (1) As used in this section:
             64          (a) "Sensitive personal identifying information" means any of the following
             65      information regarding an individual's:
             66          (i) Social Security number;
             67          (ii) drivers license number or other government issued identification number;
             68          (iii) financial account number or credit or debit card number;
             69          (iv) password or personal identification number or other identification required to gain
             70      access to a financial account or a secure website;
             71          (v) automated or electronic signature;
             72          (vi) unique biometric data; or
             73          (vii) any other information that can be used to gain access to an individual's financial
             74      accounts or to obtain goods or services.
             75          (b) "Value" means the value of the property, money, or thing obtained or sought to be
             76      obtained.
             77          (2) A violation of Section 76-6-1202 is:
             78          (a) a class B misdemeanor when the value is less than $300;
             79          (b) a class A misdemeanor when the value is or exceeds $300 but is less than $1,000;
             80          (c) a third degree felony when the value is or exceeds $1,000 but is less than $5,000;
             81          (d) a second degree felony when the value is or exceeds $5,000;
             82          (e) a second degree felony when the object of the scheme or artifice to defraud is other
             83      than the obtaining of something of monetary value; and
             84          (f) a second degree felony when the object or purpose of the scheme or artifice to
             85      defraud is the obtaining of sensitive personal identifying information, regardless of the value.
             86          (3) The determination of the degree of any offense under Subsection (2) is measured by
             87      the total value of all property, money, or things obtained or sought to be obtained by the
             88      scheme or artifice described in Subsection (2) except as provided in Subsection (2)(e).
             89          Section 5. Section 76-10-1602 is amended to read:


             90           76-10-1602. Definitions.
             91          As used in this part:
             92          (1) "Enterprise" means any individual, sole proprietorship, partnership, corporation,
             93      business trust, association, or other legal entity, and any union or group of individuals
             94      associated in fact although not a legal entity, and includes illicit as well as licit entities.
             95          (2) "Pattern of unlawful activity" means engaging in conduct which constitutes the
             96      commission of at least three episodes of unlawful activity, which episodes are not isolated, but
             97      have the same or similar purposes, results, participants, victims, or methods of commission, or
             98      otherwise are interrelated by distinguishing characteristics. Taken together, the episodes shall
             99      demonstrate continuing unlawful conduct and be related either to each other or to the
             100      enterprise. At least one of the episodes comprising a pattern of unlawful activity shall have
             101      occurred after July 31, 1981. The most recent act constituting part of a pattern of unlawful
             102      activity as defined by this part shall have occurred within five years of the commission of the
             103      next preceding act alleged as part of the pattern.
             104          (3) "Person" includes any individual or entity capable of holding a legal or beneficial
             105      interest in property, including state, county, and local governmental entities.
             106          (4) "Unlawful activity" means to directly engage in conduct or to solicit, request,
             107      command, encourage, or intentionally aid another person to engage in conduct which would
             108      constitute any offense described by the following crimes or categories of crimes, or to attempt
             109      or conspire to engage in an act which would constitute any of those offenses, regardless of
             110      whether the act is in fact charged or indicted by any authority or is classified as a misdemeanor
             111      or a felony:
             112          (a) any act prohibited by the criminal provisions of Title 13, Chapter 10, Unauthorized
             113      Recording Practices Act;
             114          (b) any act prohibited by the criminal provisions of Title 19, Environmental Quality
             115      Code, Sections 19-1-101 through 19-7-109 ;
             116          (c) taking, destroying, or possessing wildlife or parts of wildlife for the primary
             117      purpose of sale, trade, or other pecuniary gain, in violation of Title 23, Chapter 13, [Wildlife
             118      Resources Code of Utah] General Provisions, or Section 23-20-4 ;
             119          (d) false claims for medical benefits, kickbacks, and any other act prohibited by Title
             120      26, Chapter 20, Utah False Claims Act, Sections 26-20-1 through 26-20-12 ;


             121          (e) any act prohibited by the criminal provisions of Title 32A, Chapter 12, Criminal
             122      Offenses;
             123          (f) any act prohibited by the criminal provisions of Title 57, Chapter 11, Utah Uniform
             124      Land Sales Practices Act;
             125          (g) any act prohibited by the criminal provisions of Title 58, Chapter 37, Utah
             126      Controlled Substances Act, or Title 58, Chapter 37b, Imitation Controlled Substances Act,
             127      Title 58, Chapter 37c, Utah Controlled Substance Precursor Act, or Title 58, Chapter 37d,
             128      Clandestine Drug Lab Act;
             129          (h) any act prohibited by the criminal provisions of Title 61, Chapter 1, Utah Uniform
             130      Securities Act;
             131          (i) any act prohibited by the criminal provisions of Title 63, Chapter 56, Utah
             132      Procurement Code;
             133          (j) assault or aggravated assault, Sections 76-5-102 and 76-5-103 ;
             134          (k) a terroristic threat, Section 76-5-107 ;
             135          (l) criminal homicide, Sections 76-5-201 , 76-5-202 , and 76-5-203 ;
             136          (m) kidnapping or aggravated kidnapping, Sections 76-5-301 and 76-5-302 ;
             137          (n) sexual exploitation of a minor, Section 76-5a-3 ;
             138          (o) arson or aggravated arson, Sections 76-6-102 and 76-6-103 ;
             139          (p) causing a catastrophe, Section 76-6-105 ;
             140          (q) burglary or aggravated burglary, Sections 76-6-202 and 76-6-203 ;
             141          (r) burglary of a vehicle, Section 76-6-204 ;
             142          (s) manufacture or possession of an instrument for burglary or theft, Section 76-6-205 ;
             143          (t) robbery or aggravated robbery, Sections 76-6-301 and 76-6-302 ;
             144          (u) theft, Section 76-6-404 ;
             145          (v) theft by deception, Section 76-6-405 ;
             146          (w) theft by extortion, Section 76-6-406 ;
             147          (x) receiving stolen property, Section 76-6-408 ;
             148          (y) theft of services, Section 76-6-409 ;
             149          (z) forgery, Section 76-6-501 ;
             150          (aa) fraudulent use of a credit card, Sections 76-6-506.1 , 76-6-506.2 , and 76-6-506.4 ;
             151          (bb) deceptive business practices, Section 76-6-507 ;


             152          (cc) bribery or receiving bribe by person in the business of selection, appraisal, or
             153      criticism of goods, Section 76-6-508 ;
             154          (dd) bribery of a labor official, Section 76-6-509 ;
             155          (ee) defrauding creditors, Section 76-6-511 ;
             156          (ff) acceptance of deposit by insolvent financial institution, Section 76-6-512 ;
             157          (gg) unlawful dealing with property by fiduciary, Section 76-6-513 ;
             158          (hh) bribery or threat to influence contest, Section 76-6-514 ;
             159          (ii) making a false credit report, Section 76-6-517 ;
             160          (jj) criminal simulation, Section 76-6-518 ;
             161          (kk) criminal usury, Section 76-6-520 ;
             162          (ll) fraudulent insurance act, Section 76-6-521 ;
             163          (mm) retail theft, Section 76-6-602 ;
             164          (nn) computer crimes, Section 76-6-703 ;
             165          (oo) identity fraud, Section 76-6-1102 ;
             166          (pp) real estate fraud, Section 76-6-1203 ;
             167          [(pp)] (qq) sale of a child, Section 76-7-203 ;
             168          [(qq)] (rr) bribery to influence official or political actions, Section 76-8-103 ;
             169          [(rr)] (ss) threats to influence official or political action, Section 76-8-104 ;
             170          [(ss)] (tt) receiving bribe or bribery by public servant, Section 76-8-105 ;
             171          [(tt)] (uu) receiving bribe or bribery for endorsement of person as public servant,
             172      Section 76-8-106 ;
             173          [(uu)] (vv) official misconduct, Sections 76-8-201 and 76-8-202 ;
             174          [(vv)] (ww) obstruction of justice, Section 76-8-306 ;
             175          [(ww)] (xx) acceptance of bribe or bribery to prevent criminal prosecution, Section
             176      76-8-308 ;
             177          [(xx)] (yy) false or inconsistent material statements, Section 76-8-502 ;
             178          [(yy)] (zz) false or inconsistent statements, Section 76-8-503 ;
             179          [(zz)] (aaa) written false statements, Section 76-8-504 ;
             180          [(aaa)] (bbb) tampering with a witness or soliciting or receiving a bribe, Section
             181      76-8-508 ;
             182          [(bbb)] (ccc) retaliation against a witness, victim, or informant, Section 76-8-508.3 ;


             183          [(ccc)] (ddd) extortion or bribery to dismiss criminal proceeding, Section 76-8-509 ;
             184          [(ddd)] (eee) public assistance fraud in violation of Section 76-8-1203 , 76-8-1204 , or
             185      76-8-1205 ;
             186          [(eee)] (fff) unemployment insurance fraud, Section 76-8-1301 ;
             187          [(fff)] (ggg) intentionally or knowingly causing one animal to fight with another,
             188      Subsection 76-9-301 (1)(f);
             189          [(ggg)] (hhh) possession, use, or removal of explosives, chemical, or incendiary
             190      devices or parts, Section 76-10-306 ;
             191          [(hhh)] (iii) delivery to common carrier, mailing, or placement on premises of an
             192      incendiary device, Section 76-10-307 ;
             193          [(iii)] (jjj) possession of a deadly weapon with intent to assault, Section 76-10-507 ;
             194          [(jjj)] (kkk) unlawful marking of pistol or revolver, Section 76-10-521 ;
             195          [(kkk)] (lll) alteration of number or mark on pistol or revolver, Section 76-10-522 ;
             196          [(lll)] (mmm) forging or counterfeiting trademarks, trade name, or trade device,
             197      Section 76-10-1002 ;
             198          [(mmm)] (nnn) selling goods under counterfeited trademark, trade name, or trade
             199      devices, Section 76-10-1003 ;
             200          [(nnn)] (ooo) sales in containers bearing registered trademark of substituted articles,
             201      Section 76-10-1004 ;
             202          [(ooo)] (ppp) selling or dealing with article bearing registered trademark or service
             203      mark with intent to defraud, Section 76-10-1006 ;
             204          [(ppp)] (qqq) gambling, Section 76-10-1102 ;
             205          [(qqq)] (rrr) gambling fraud, Section 76-10-1103 ;
             206          [(rrr)] (sss) gambling promotion, Section 76-10-1104 ;
             207          [(sss)] (ttt) possessing a gambling device or record, Section 76-10-1105 ;
             208          [(ttt)] (uuu) confidence game, Section 76-10-1109 ;
             209          [(uuu)] (vvv) distributing pornographic material, Section 76-10-1204 ;
             210          [(vvv)] (www) inducing acceptance of pornographic material, Section 76-10-1205 ;
             211          [(www)] (xxx) dealing in harmful material to a minor, Section 76-10-1206 ;
             212          [(xxx)] (yyy) distribution of pornographic films, Section 76-10-1222 ;
             213          [(yyy)] (zzz) indecent public displays, Section 76-10-1228 ;


             214          [(zzz)] (aaaa) prostitution, Section 76-10-1302 ;
             215          [(aaaa)] (bbbb) aiding prostitution, Section 76-10-1304 ;
             216          [(bbbb)] (cccc) exploiting prostitution, Section 76-10-1305 ;
             217          [(cccc)] (dddd) aggravated exploitation of prostitution, Section 76-10-1306 ;
             218          [(dddd)] (eeee) communications fraud, Section 76-10-1801 ;
             219          [(eeee)] (ffff) any act prohibited by the criminal provisions of [Title 76,] Chapter 10,
             220      Part 19, Money Laundering and Currency Transaction Reporting Act;
             221          [(ffff)] (gggg) any act prohibited by the criminal provisions of the laws governing
             222      taxation in this state; and
             223          [(gggg)] (hhhh) any act illegal under the laws of the United States and enumerated in
             224      Title 18, Section 1961 (1)(B), (C), and (D) of the United States Code.




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    as of 12-21-07 7:23 AM


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