Victims of fraud committed by unscrupulous real estate brokers and appraisers have a hard time getting justice in Florida. The state's Division of Real Estate takes too long investigating complaints before referring them to state prosecutors, who too often fail to file criminal charges. Inexcusably, the current system tells perpetrators that even if they are caught there is little chance of being criminally prosecuted. It tells victims that because their losses are due to white-collar fraud and not a street mugging, law enforcement's response will be anemic. There should be better responsiveness by both the state and by law enforcement officials to quickly pursue the most egregious cases and hold the bad actors accountable for their crimes.
There's no other way to say it: The state agency charged with protecting consumers from dishonest real estate agents, appraisers and instructors is falling down on the job. A St. Petersburg Times analysis by staff writer Mark Puente of 1,595 cases the division referred to state attorneys in 2009 and 2010 found that an average investigation took 18 months, with some taking years. During the delay, more than 100 real estate professionals committed additional misdeeds while a complaint against them was pending.
For instance, it took the division two years to investigate Miami broker Donald Charnin, who was accused of pocketing security deposits. His license was eventually revoked, but the agency's slow reaction allowed Charnin to rack up six more victims and no criminal charges.
State attorneys say the cases referred by the agency often suffer serious defects. Pinellas-Pasco State Attorney Bernie McCabe says typically the cases involve minor real estate license issues. But when fraud or theft is alleged — something the office would aggressively pursue — its experience is that the division investigations have taken so long that the statute of limitations for filing criminal charges has often run out. Also, McCabe said, the division doesn't hand over prosecution-ready case files, leaving it to his office to do substantial investigative work.
One reason the division is not more responsive is staffing. Only 33 investigators are employed statewide to handle thousands of annual complaints. From 2009-10 there were more than 6,000 complaints, while the year before there were more than 7,000. There aren't enough investigators, and it shows.
Even so, when a real estate professional is accused of serious fraud or theft there should be a system in place to quickly get those cases into the hands of a state attorney. For victims, the loss of a security deposit to a crooked broker is just as painful as having money stolen in a burglary, and the crime should be pursued just as vigorously. The division clearly needs more people and resources, but it also needs a new way of doing its job. A real estate license should not be a license to steal.