- A disturbing report published last month by KLAS Channel 8 News revealed that a building owned by the late Tony Hsieh, founder of Zappos, was fraudulently transferred to an LLC in California by a person claiming to be acting on behalf of Hsieh’s 319 9th Street, LLC.
According to the report:
The transaction filed with the county and provided in court documents shows the transaction between “319 9th Steet, LLC” and “Galaxy Home Buyers LLC.” The warranty deed shows the sale from a person named Santiago Espinosa, but lawyers for the estate claim no such person has the authority to act on behalf of the company — and that they do not know who Espinosa is.
In addition, the signature of the title officer for the title company was forged, documents said. It was unclear if other documents, including ones that were notarized, were also fraudulent.
The title has since returned to the Hsieh estate following demand letters its lawyers sent to the buyers, records showed.
The theft of Tony Hsieh’s property could be cause for greater public concern due to the fact that The Globe has learned, from a source inside the Clark County Recorder’s Office, that the office is allegedly 10 years behind in the verification and indexing of records related to the sale, purchase, transfer, liens and claims of real estate properties and transactions. The source also claims that the office was instructed to hide the decade-long lag from the public.
Verification of records is done by the office to confirm that the document was recorded and indexed correctly. Indexing of the document occurs after the document is recorded. The recorded document is transferred into an image and indexed (labeled) so that the document can be easily found after recording and when requested.
In a screen shot taken in June 2021, and shared with The Globe, the ten-year lag was shown on the Recorder’s website. However, when the Recorder’s office began receiving questions from the public about the lag, the “released through” notification was immediately from the website. The Globe has confirmed during a property search that the notification has been removed.
Our source told The Globe:
“The recorder’s office has gone to great lengths to hide that they are 10 years behind in verifying documents. This is horrifying and of great concern to any homeowner or agency that relies on the recorders office to audit and verify documents related to property ownership.
The backlog needs to get solved. The property you own is your biggest investment and is at risk by the negligent policies and procedures in the department. How did someone steal Tony Hsieh’s property?
There is no way that humans can solve this problem now because they are so behind and the Recorder doesn’t have enough staff to get caught up. Conway has created such a huge problem. It is going to take a lot of time and money and systems to solve this. It is going to cost the county and the tax payers a lot of money to solve this problem. There is a lot that needs to be done to fix this mess and that is why this information has to come out.”
Home title thieves, like the one that the Hsieh’s estate encountered, are prevalent and normally prey on the elderly and target homes with high equity. Clark County is one of the few counties that does not allow a homeowner to view their documents on the recorder’s website. A homeowner must drive to the county to view documents, visit a one of two kiosks, or the documents can be ordered and paid for through the county website and the recorder’s office will mail the requested documents.
According to another source, Broward County, Florida has a similar population size of Clark County and processes a similar amount of real estate-related transactions. Until Hurricane Ian, the Broward County Recorder’s office processed (recorded and indexed) all documents by the end of the business day on the day the document is received by the office. Due to the hurricane, the Broward County recorder’s office is now four days behind, however, no documents have been received over those four days due to damage and disruption caused by the Hurricane Ian.
The Clark County Recorder is elected to a four-year term. Recorder Debbie Conway is up for re-election in November and has worked for the county for 16 years. Being that these allegations have surfaced near the November election, The Globe took special lengths to verify our sources and has filed an open records request (see below) with Clark County in order to provide answers to the general public, substantiate our source’s claims, and to provide additional information with regards to the fraudulent sale and transfer of Hsieh’s property.
In a lengthy phone call with The Globe, Conway denied the allegations:
“Your source doesn’t understand what the Nevada statute says. My job is spelled out in the law. In the state of Nevada there is nothing that is spelled out in the law regarding when to record a document, we are simply required to record the document if the document is recordable. We cannot turn the document down if the recording requirements of the documents are met. It is not our job to determine legality of the document. We are there to determine if it is recordable. It takes our recorders two years to become proficient at their job and requires extensive training.
There are certain laws that govern indexing. As soon as the document is recorded, it is indexed that day and we follow the state law. We are caught up on a daily basis on the indexing of the documents. We have an internal goal in processing and indexing documents in a three-day period. We are now caught up with indexing because things have slowed down. There is no 10 year back log of documents and there is no requirement to verify documents that same day. I have never asked anyone to remove anything from the website.
We do recording and indexing as a service to the pubic. We are the only recorder in the state that has a kiosk in Laughlin and one in the recorder’s office and have plans to expand kiosks into the community so they can access their documents from a kiosk instead of driving down to the office. We can receive 1000-5000 documents a day. If we get 5,000 documents in one day, we have to leave some of those documents to the next day for indexing.
The recorder’s office has brought in technological improvements and enhancements to assist us and the public. Our goal is to stabilize the office and create efficiencies for the public. We have done a decent job over the years to accomplish our goals. Our people in the office are very diligent and hard working and have a desire to make things easier for the public. Quality assurance and quality control is implemented after docs are recorded to ensure everything is accurate. We aren’t bound by law to do that the same day. We take quality assurance and control measures to correct manual errors and this step is part of our overall process.
Whoever is telling you this may have other motives as we are getting close to the election.”
The Globe will provide an update to this story when the open records request is completed.Records ORR
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