Legislative Analysis
Phone: (517) 373-8080
FRAUDULENT CONVEYANCES
http://www.house.mi.gov/hfa
House Bills 5598 (H-1) and 5599 as reported from committee Analysis available at
Sponsor: Rep. Tullio Liberati, Jr. http://www.legislature.mi.gov
Committee: Local Government and Municipal Finance
Complete to 6-13-24
SUMMARY:
House Bill 5598 would make updates to 1883 PA 98, an act pertaining to fraudulent land
conveyances. House Bill 5599 is a companion bill that would make complementary changes
to the Code of Criminal Procedure.
House Bill 5598 would amend 1883 PA 98 to prohibit the intentional filing of a fraudulent
document with a register of deeds and to update language in the act. The act’s title would also
be amended to reflect the new language in the bill.
Currently under the act, a person who procures or places upon record a conveyance of real
estate with the intent to deceive as to the identity of the grantor mentioned in the conveyance
must be punished by up to three years’ imprisonment at the state prison for hard labor or a fine
of up to $5,000, or both.
The bill would instead provide that a person that procures or places upon record a conveyance
of real estate with the intent to deceive another person as to the veracity of the document is
guilty of a felony, punishable by up to three years’ imprisonment, a fine of up to $5,000, or
both.
Additionally, a person that knowingly and willfully drafts or submits a document to be filed
and recorded with a register of deeds in Michigan with the intent to defraud the owner of real
estate or the owner of an interest in real estate would be guilty of a felony, punishable by up to
10 years’ imprisonment, a fine of up to $5,000, or both. A register of deeds that believes a
fraudulent document has been submitted could provide evidence of the violation to the
appropriate county prosecutor.
MCL 565.371
House Bill 5599 would amend the sentencing guidelines chapter of the Code of Criminal
Procedure to incorporate the proposed felony of drafting or submitting a fraudulent conveyance
to be filed with a register of deeds. Under the bill, such an offense would be a Class D felony
against property punishable by a statutory maximum term of imprisonment of 10 years.
The bill cannot go into effect unless HB 5598 is also enacted.
MCL 777.15b
House Fiscal Agency Page 1 of 3
BRIEF DISCUSSION:
According to committee testimony, bad actors are increasingly entering fraudulent deeds into
registers of deeds’ databases to steal a property from a homeowner, and it is a lengthy legal
process to get a property back to its rightful owner once a fraudulent deed has been filed.
Supporters of House Bills 5598 and 5598 believe that in order to protect landowners’ property
rights, it should be illegal to enter a forged document into a register of deeds’ database, and
there should be strong penalties for individuals who intentionally execute or record fraudulent
documents. They argue that the bills would disincentivize property fraud, as once a register of
deeds office receives a complaint, it could verify the chain of title to determine if the complaint
is legitimate and then pass on complaints to a prosecutor for resolution.
Opponents of the bills as introduced raised concerns that notaries, title companies, and
attorneys could be held responsible and prosecuted when a forged document is filed, even if
they have no knowledge that fraud is occurring. They also argue that House Bill 5598 could
require the contents of a deed or other document to be reviewed before filing, even though
registers of deeds are solely responsible for making sure a document is in recordable form
rather than verifying its contents. Reportedly, registers of deeds often lack the resources or time
to properly verify a document before it is filed, so requiring registers to do so could result in
valid documents being rejected when they otherwise should not be. Opponents suggest that a
better solution would be to amend Chapter XLIII (Frauds and Cheats) of the Penal Code to
prescribe penalties for those who file fraudulent documents.
The H-1 substitute adopted by the House Local Government committee for House Bill 5598
provides that the proposed felony charge and penalties for those who knowingly and willfully
draft or submit a document to be filed with a register of deeds would only apply if a person
drafts or submits the document with the intent to defraud, rather than if the person knowingly
and willfully drafts or submits a fraudulent document. According to committee testimony, the
substitute intends to address opponents’ concerns and ensure that the bill only targets
individuals who intentionally attempt to submit documents to a register of deeds with the goal
of defrauding a property owner.
FISCAL IMPACT:
House Bill 5598 would have an indeterminate fiscal impact on the state and on local units of
government. The number of convictions that would result under provisions of the bill is not
known. New felony convictions for individuals knowingly and willfully drafting or submitting
fraudulent documents to be filed and recorded with registers of deeds would result in increased
costs related to state prisons and state probation supervision. In fiscal year 2023, the average
cost of prison incarceration in a state facility was roughly $48,700 per prisoner, a figure that
includes various fixed administrative and operational costs. State costs for parole and felony
probation supervision averaged about $5,400 per supervised offender in the same year. Those
costs are financed with state general fund/general purpose revenue. The fiscal impact on local
court systems would depend on the number of new convictions and how they affect court
caseloads and related administrative costs. Any increase in penal fine revenue would increase
funding for public and county law libraries, which are the constitutionally designated recipients
of those revenues.
House Fiscal Agency HBs 5598 (H-1) and 5599 as reported Page 2 of 3
 House Bill 5599 is a companion bill to House Bill 5598 and would amend the sentencing
guidelines chapter of the Code of Criminal Procedure to include the proposed new felony of
drafting or submitting fraudulent documents to be filed with the register of deed as a Class D
felony punishable by a statutory maximum of 10 years. The bill would not have a direct fiscal
impact on the state or on local units of government.
POSITIONS:
Representatives of the following entities testified in support of the bills (5-15-24):
• Wayne County Register of Deeds
• Michigan Association of Registers of Deeds
The City of Detroit indicated support for the bills. (5-15-24)
A representative of the Real Property Law Section of the State Bar of Michigan testified in
opposition to the bills. (5-15-24)
Legislative Analyst: Holly Kuhn
Fiscal Analyst: Robin Risko
■ This analysis was prepared by nonpartisan House Fiscal Agency staff for use by House members in their
deliberations and does not constitute an official statement of legislative intent.
House Fiscal Agency HBs 5598 (H-1) and 5599 as reported Page 3 of 3


Statutes affected:
Substitute (H-1): 565.371
House Introduced Bill: 565.371
As Passed by the House: 565.371