“Misplaced” Funds From Sheriff’s Office Legally Belong to Victimized Property Owners

The mayor, sheriff and city controller have no right to give this money to the government

The news that nearly $56 million had been recovered from the bowels of the sheriff’s office’s sloppy bookkeeping was welcomed by government officials. However, the former owners of properties sold at sheriff sale—who are due much of that money—continue to be victimized by government ineptitude. City officials announced that the funds–including unclaimed proceeds of sheriff sales over the last dozen years when property sales generated more than the amounts owed for past-due mortgages, taxes, and utilities–would be transferred to the City’s General Fund and State Treasury.  But, that money was not just misplaced, it was misappropriated; taken from those who were lawfully due the funds.  Unless they act deliberately and quickly to return the money to the rightful recipients, the sheriff, controller and the mayor are working to benefit government balance sheets instead of helpless property owners.

State law governs what is to happen when properties are sold at sheriff sale to enforce judgments against property owners who owe back mortgage, tax, and utility payments. According to the law, after the sale the Sheriff is responsible to prepare a schedule of proposed distribution of the proceeds of the sale, which is to be kept on file and be available for inspection.  The sheriff is also legally required to distribute sale proceeds pursuant to the schedule of distribution to pay judgment debtors as well as sheriff’s costs. Proceeds of the sale in excess of those debts and administrative costs must legally be distributed to the former property owners.

Much of the $56 million in funds that are being transferred to the city and the state are actually owed to the former owners of properties that were lost in foreclosure or tax sales. While some property owners are undoubtedly hard to track down, many have been working for years to recover their money and should absolutely receive their payments before their money is given over to the government.

Rest of the story here…