In my Saturday Night Race Card post a few weeks ago, I mentioned that I was researching a book on real estate fraud and corruption.

The main characters in my narrative are a couple who look like you and me and seem perfectly lovely.  But in the go-go days of free mortgages last decade, they bought ten homes with almost no money and no credit, and as the market skyrocketed they cashed out on re-fis to the tune of millions.

Then when the market tanked and they found themselves upside on every property, they divorced for legal purposes (they’ve never not lived together), divvied up the homes, named each other as creditors, filed for individual Chapter 7 bankruptcies, lied repeatedly on the filings, wiped out millions in debts, were allowed to keep the upside homes because the bankruptcy trustees only want assets that they can convert to cash for the creditors, and have continued to collect rent from tenants while the homes are in foreclosure—going on four and five years.

A few days ago, as part of my research, I dispatched my wife to gather some documents from an old probate filing in Ventura(Calif.), just north and west of Los Angeles.

Keep in mind that these are public documents available for everyone to see, whether they’re cops or illegal aliens.  But when my wife filled out the request form and asked for the file, the clerk demanded her driver’s license.

“Why?” my wife asked why.

“For security,” the clerk said.

“These are public documents.”

“Yes, they are.”

“I don’t have to show my license to vote.”

“I know.”

“But here, I have to not only show you my license, I have to give you my license to see public documents?”

“We just hold it till you bring the file back.”

“But I’m sitting right there, at that table in front of you.”

“You wouldn’t believe the amount of theft we have.”

“So holding licenses is the only way to stop it?”

“It’s the cheapest way.”

“What if someone has a stolen license?”

“We can’t do anything about that.”

“If I show up voting day at the polls and pretend to be my neighbor or make up another name, I get to vote without showing i.d.”

“That would be illegal.”

“In fact, I think all I have to do to register to vote the first time is show a utility bill. In which case, I could be an illegal.”

“I don’t know about that.”

“But if I want to see public documents I have to actually give you my i.d.”

“Yes.”

“Why aren’t these documents scanned and available online?”

“We don’t have the money for that.”

“How much does it cost to photocopy a page?”

“Fifty cents.”

“Maybe with the money you’re making on Xeroxing you could hire a guard to stand at the door.”

“Ma’am, if you want the file, I need your license.”

Well, I needed the file, so my wife handed over her license.

This is only a side anecdote to the main issue, but in a very real sense the exchange hints at the corruption I’ve been uncovering.  Clearly, the bigger government gets, the further it strays from its public charter.  This couple I’m writing about have been aided and abetted, if only passively, by large banking institutions and law enforcement (local, state, and feds) that simply avert their eyes because no one wants to be bothered.

The story is like a white-collar Blue Velvet.  But believe me, this isn’t Capt. Renault territory here. This is tens of billions of dollars that end up in the pockets of ordinary crooks who know they’ll never face the music, even though guiltless taxpayers end up footing the bill in the form of programs like TARP and bailouts to Fannie Mae and Freddie Mac.

I’m still at the outer edges of the research, but in the months I’ve been doing this I haven’t found a single law-abiding citizen—including lawyers!—who isn’t as shocked and dismayed as I’ve been by the amount of open-secret corruption out there.  The only exceptions?  People in law enforcement, banking, and government.  They simply shrug and say, “Yeah, there’s a lot of that going on.”

Example: One of the documents my wife found was a lien notice filed by a national retailer on a home that the couple lived in.  The lien, like the home, was in the name of the wife’s father…who died seven years ago.  Apparently three years ago the couple ran up $11,000 on the dead man’s card—which is fraud—and never paid for the merchandise, which is grand theft.

I asked a detective who heads a white-collar crime task force what would happen if, when I publish, I use the couple’s real names.  Will they be subject to indictment?

“Probably not,” he said. “But you might be exposing yourself to a defamation suit.”

Remember that the next time your credit card company hits you up for a late fee, and your bank charges you ten bucks for a bounced check—even if someone wrote it to you.