A recent editorial in the Eugene, Oregon Register-Guard newspaper spells out the perils of a fraudulent property manager who defrauded over 350 real estate investors who trusted him with managing their properties while he absconded their money. He is currently awaiting sentencing on two counts of federal wire fraud, however according to the article the lawsuits are piling up.
“Shockley has admitted that for years he defrauded and lied to clients who paid him to manage their rental properties. Many of his 350 clients were small investors, holders of at most a few rental units that offered some financial security. Shockley assured his clients that their investments were safe, that the rent receipts and tenants’ deposits that belonged to them were being held in a secure trust account. That was a lie.”
While this article is pro-regulation, there is no excusing a real estate investor who doesn’t ask hard questions, regularly, of those who manage their property. Personal involvement and oversight by the investors would have saved them a great deal of pain and loss – and that is more then any regulatory process can ever do! Please learn from the mistakes of Shockley’s 350 investors. If you don’t know what questions to ask, consider becoming educated on property management so that you know the right questions to ask even when you aren’t managing 24/7 – it’ll be worth the investment! One place to start is with National REIA’s Professional Housing Provider program.
