REAL ESTATE RELOCATION INDUSTRY FACING MILLIONS IN POTENTIAL FINES FROM WHISTLEBLOWER ACTION FOR FAILING TO PAY DOC STAMP FEES
Industry Has Hired Top Guns to Generate Legislation to
Make Their “Wrongdoing” Legal
WESTON, FL- A bill that is close to passing in the Florida Legislature puts the state in jeopardy of losing hundreds of millions of dollars in doc stamp fees from some of Florida’s wealthiest companies. Doc stamps are fees paid to the state per one thousand dollars of a real estate transaction. (H.B. 1835, S.B. 1542)
“The bill legalizes a tax scam where many companies in the relocation industry have failed to pay their fair share of doc stamp taxes. It also exempts the same violators from paying fines, interest and back taxes that amount to a half-billion dollars,” said South Florida attorney and consumer activist, Roy Oppenheim who heads Private AG. Private AG is a corporation that represents the state under the Florida Whistleblower Act.
The bill would also derail a lawsuit filed by Private AG that is trying to stop this illegal practice and require the industry to pay its fair share. The lawsuit names dozens of relocation companies and outlines their elaborate scheme:
In corporate moves, typically a relocation company is brought in to assist an employee with the sale of his/her house. The relocation company then buys that home, at somewhere between 85% to 95% of the appraised value. Once the employee accepts the offer of the relocation company, the employee then signs a blank warranty deed where a subsequent purchaser’s name is left blank. “In the state of Florida this procedure is illegal and invalidates the deed,” said Stuart Slutsky, an attorney and co-founder of Private AG. “Once the first transaction is made, under Florida law, the doc stamp fees need to be paid.” But, the relocation companies are not paying the doc stamps until the home is sold or flipped to another party.
“We found the industry is playing a shell game where they are cheating the state out of hundreds of millions in taxes that could be used for education, the elderly, and cleaning up the environment,” Oppenheim said. “It’s time for this illegal game to stop.”
Now, three years after Private AG sued the companies on behalf of the state, the relocation industry is trying to avoid a court battle and the big loser will be Florida taxpayers. The relocation industry has hired top lobbyists to change the law retroactively and kill the suit. According to the court file, the relocation defendants have already spent $1 million defending the suit.
If the lawsuit succeeds, the industry faces damages that could reach into the hundreds of millions of dollars. Each violation would create treble damages, where the original amount owed plus interest is multiplied by three and then an additional 5-10 thousand-dollar fine is attached to each illegal transaction.
“The relocation industry needs to learn that they, like all Florida taxpayers, have to pay their due,” said Oppenheim. “Nobody gets a free ride.”
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Private AG, Inc. is a private corporation, not affiliated with the Florida Attorney General’s office, which represents the state of Florida in a lawsuit against a number of companies within the relocation industry. Private AG‘s president is Roy Oppenheim , a Weston-based attorney and consumer activist who practices with the law firm of Oppenheim Pilelsky.
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Oppenheim is a partner in the firm, along with his wife Ellen Pilelsky. Oppenheim Pilelsky, the oldest law firm in Weston, is a general practice concentrating in real estate, litigation and consumer related matters. The firm sued Firestone Tire & Rubber Company on behalf of all Florida residents who have been subject to the recall of defective tires and is suing the US Government concerning the wrongful death of a two-year old who died of meningitis after a misdiagnosis by a doctor at MacDill Airforce Base. The law firm of Oppenheim & Pilelsky is located at: 1290 Weston Road, Suite 300, Weston, FL 33326 (954) 384-6114 or 1-888-384-6114. Oppenheim Pilelsky can also be found at www.oppenheimlaw.com.
/Contact: Julie Silver, Christine Manna, Gwen Silverstein, or Todd Templin at Boardroom Communications, 954-370-8999, OR Roy Oppenheim for Private AG 954-980-6986 (cell).