Trust This. | By Joseph E. Seagle, Esq. | 👋 Happy Friday! Today is National Frankenstein Friday, which is the last Friday of October and points back at Mary Shelley's 1818 novel rather than the green-faced version the movies presented. Shelley's actual subject wasn't the monster. It was a builder who assembled something, walked away from it, and then found out it could act without him. Happy Halloween! | Which is a reasonable way to think about three of this week's four stories. |
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| | 1 big thing: The $304 billion hole nobody had sized | | The federal government has measured its own tax shortfall for decades. It had never tried to say how much of that gap is outright fraud. Now there's a number. The Government Accountability Office estimates tax fraud costs the Treasury between $116 billion and $304 billion a year, roughly 2% to 6% of estimated tax owed, in its first attempt to calculate the figure (Bloomberg, September 25, 2026). | The big picture: GAO built the estimate from 2018 through 2024 data, so it spans the pandemic-era programs that produced a long run of publicized frauds. GAO recommended that the IRS adopt a formal anti-fraud strategy and establish an internal group to coordinate the work. In a letter included in the report, IRS chief executive Frank Bisignano pushed back, arguing GAO defined fraud too broadly and swept in conduct better explained as ordinary noncompliance. | Why it matters: that definitional fight is the part worth your attention. | The line between "noncompliance" and "fraud" is the line between a civil penalty and a criminal referral. Two agencies now disagree publicly about where it sits. Bisignano has publicly emphasized better data and technology as the way to identify tax cheats and narrow the gap. Automated matching rewards clean records and flags inconsistent ones, and it doesn't care how reasonable your explanation would have been. Florida has no personal income tax, so for most pass-through operators the federal return is the whole exposure. If your entity is taxed as a corporation, you've still got a Florida F-1120 on top of it.
| What most people don't know: GAO drew no link between IRS funding levels and the agency's ability to find fraud. The funding fight is the story that is often reported. The change in method is the one that reaches your life. | What to execute: | For home services businesses — HVAC, plumbing, electrical, painting, cleaning: worker classification and cash receipts are the two files most likely to look wrong to a matching algorithm. Reconcile your 1099-NEC totals against your books before year-end, not in April. For real estate investors and private lenders — partnership allocations and basis records are where documentation fails. If a K-1 allocation doesn't trace to the operating agreement, fix the paper now. For licensed professionals — reasonable compensation on an S corporation is a perennial adjustment in your category. Document the comparables behind the number you picked.
| Watch for: whether the IRS creates the coordinating entity that the GAO asked for, and whether it stands up any new targeted compliance initiative at all. It hasn't launched one since the enforcement funding was clawed back. | The bottom line: nobody is accusing your business of fraud. But the agency that decides what the word means is rebuilding how it looks, and clean records cost less than a good argument. |
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| | 2. The title agent who never recorded the mortgages | | Michael Saracco, 40, of Cocoa, has pleaded guilty to three counts of wire fraud and faces up to 20 years on each, according to a September 14 announcement from the U.S. Attorney's Office for the Middle District of Florida. Sentencing is set for December 2. Saracco is a former attorney who owned Driftwood Title and All Florida Property Solutions (The Legal Description, September 28, 2026). | The big picture: according to court documents, the conduct ran from August 2019 to July 2025. Saracco solicited loans against properties he said he owned or was buying, told lenders they were free of debt, and closed transactions while representing that he had recorded the loan documents. He didn't record them. Existing loans went undisclosed on settlement statements, closing disclosures understated the real picture, payoff money was diverted, and title commitments were issued claiming policies were in place when they weren't. | Why it matters: every one of those failures sits in a step most lenders delegate and never verify. | An unrecorded mortgage is not a lien problem you discover later. Against a later buyer who pays value without notice of it, under Fla. Stat. § 695.01 it's a lien that effectively never existed. A title commitment is a promise to insure. A title policy is insurance. Private and hard money lenders routinely close on the first and never confirm the second arrived. Also, if your closing instructions aren’t tied to a closing protection letter (aka insured closing letter), then the insurer may have no responsibility to make good for the title agent’s failure to record the documents and issue the policy. The scheme ran about six years across multiple lenders before it surfaced. Nothing about the pace of any single closing would have looked unusual.
| What most people don't know: the investigation came out of the Federal Housing Finance Agency and the Brevard County Sheriff's Office, with Special Assistant U.S. Attorney Chris Poor prosecuting. A county sheriff's office working alongside a federal housing regulator is how this category of case now gets built in Florida. | How to use this without getting burned: | For private lenders and note investors — pull the recorded instrument yourself from the county clerk's official records after closing. Every time. Most Central Florida clerks, Orange and Brevard among them, publish searchable official records at no cost. Always require an insured closing letter from the title insurer prior to closing — usually with the title commitment; and give written closing instructions to the agent, stating that they’re not allowed to disburse your funds until they’re in a position to record the mortgage and issue a policy. For real estate investors — insist on the issued policy, not the commitment, and confirm the underwriter actually shows the agency as authorized. Just like the lender, you too should require the insured closing letter and provide written closing instructions prior to closing. For anyone closing volume — verify payoffs directly with the payoff lender, and verify wire instructions by voice on a number you looked up yourself.
| The bottom line: the protection in a Florida closing isn't the closer's reputation. It's the recording, the insured closing letter, and the policy, and you can confirm all three in about ten minutes. |
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| | | In this week’s episode of the Trust This podcast, we discuss asset protection for home service business owners, and why one LLC may not be enough. | Listen in or watch on your favorite streaming platform. |
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| | 3. Practice Pointers: Your LLC is member-managed by default | | Most Florida business owners treat an LLC's management structure as a box on a form. It decides who can sign your company into a deal, and who can sign away your real estate. | The big picture: under Fla. Stat. § 605.0407(1), a Florida LLC is member-managed unless its operating agreement or articles expressly say the company is manager-managed, is managed by managers, or that management is vested in managers. The statute also accepts words of similar import, which is a thin reed in front of a judge. Member-management isn't something you choose. It's the default you get when you don't choose. | Why it matters: in a member-managed Florida LLC, every member is a statutory agent. | Under § 605.04074(1), a member's act binds the company if it's apparently within the ordinary course of its business, unless that member lacked authority and the other side knew or had notice of it. Your partner's handshake is the company's contract. Manager-management flips that. Under § 605.04074(2), a member is not an agent solely by reason of being a member. Managers are, and so is anyone your documents or a filed statement of authority empowers. Under § 605.0301, those are the only routes by which anyone binds your LLC: statutory agency, your governing documents, a filed statement of authority, or law outside chapter 605. For those interested in privacy, most banks and other businesses will want to see on Sunbiz the names of the company’s representatives who can legally bind the company. If that’s the members, then those members’ name are publicized on Sunbiz. However, in manager-managed companies, only the managers may be listed. If you, another entity, or a trust, is a member, that non-managing member’s name can stay off the public database.
| What most people don't know: two things, and the second is the expensive one. | First, calling someone a "managing member" does not make your company manager-managed. Section 605.0407(1)(b) provides that unless the context requires otherwise, "managing member" and "managing members" do not, in and of themselves, constitute words of similar import for that purpose. The title is everywhere in Florida operating agreements, and those companies are still member-managed by operation of law. | Second, § 605.04074(3) reaches real property. Unless a certified statement of authority limiting the power is recorded in the county's real estate records, a member of a member-managed company, or a manager of a manager-managed one, may sign and deliver an instrument transferring or affecting the company's real property, and it is conclusive in favor of someone who gives value without knowing the signer lacked authority. So converting to manager-managed moves that signing power. It doesn't remove it. The recorded statement of authority is the only thing in the statute that limits it. | Key takeaways: | Say it expressly — use the statutory language in the articles or the operating agreement. Silence is a choice, and it's the wrong one. Manager-managed is better in most cases. Title is not structure — "managing member" is a business card, not a management designation under § 605.0407(1)(b). Record the statement of authority — § 605.0302 lets you grant or limit authority through the Department of State, and a certified copy recorded in the county property records is what reaches your real estate. It lapses five years after it takes effect or its last amendment, so calendar the renewal. Watch the public record — § 605.0212 requires the annual report to name at least one person with authority to manage, with title and address. A manager that is itself a trust or entity satisfies that line without putting a human manager's name in the state's searchable database. Count your members — under § 605.0503, a charging order is a creditor's exclusive remedy against a multi-member LLC, and subsection (6) bars foreclosure outright. Subsection (4) lets a creditor foreclose a single-member interest on a showing that distributions won't satisfy the judgment in a reasonable time.
| The bottom line: if you can't point to the sentence that makes your company manager-managed, every member you have can sign for it, and in Florida that includes signing your deed. | For out-of-state subscribers: this is Florida law under chapter 605. Default rules, agency provisions, and charging order protection vary materially by state, and most states are less protective than Florida on foreclosure of a member's interest. Have your own state's act reviewed by counsel licensed there. | Go deeper: Read the full long-form article on aspirelegal.com and download the Florida LLC Management Audit |
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| | 4. Coaching Thoughts: Your availability is the bottleneck, not your team |  | Hudson and Edward are always available on the sofa. |
| Ask a founder why everything still must go through them and you'll get a staffing answer: “The team isn't ready.” “Nobody else can price it.” “Clients only want me.” | Writing in Inc., executive coach Bruce Eckfeldt makes a sharper point: dependence is manufactured by presence more often than by talent gaps. If you're always reachable, coming to you is the easiest path, and your team takes the easiest path. That isn't inexperience. That's just human. | Availability is a variable you set | Eckfeldt describes a client running a long-established company with more than 50 employees, where every decision ended up on her desk. She didn't restructure anything. She started going to the gym, stayed unreachable until 10:30, and required a day's notice for any meeting. Roughly 80% of what used to reach her got solved before she walked in. | Nothing about her team changed. The cost of waiting for her changed, so they stopped waiting. | Run it as a design problem, not a willpower problem | This is where EOS vocabulary earns its keep. Delegate and Elevate asks you to sort your work by what you're good at and what energizes you, then push the rest down. Most owners do that exercise, agree with it, and quietly take the work back, because the delegation was never structural. An unreachable morning is structural. | Pick the window. Two hours, same hours, every day, and tell the team. Publish what gets decided without you, what waits for the window, and what genuinely reaches you anyway. Two of those three lists are usually empty on paper and overfull in practice. Log every escalation that breaks the window. After three weeks, the log tells you whether you have a decision-rights problem or a capability problem. Each problem has different fixes.
| The uncomfortable part | Hold the window for a month and watch the escalations dry up. The Integrator seat on your Accountability Chart may already be filled by someone who isn't you, informally, and your calendar is the only thing hiding it. Good outcome for the business. Strange one to come to terms with. | Bottom Line: your team's dependence is mostly a response to how cheap you are to interrupt. Raise the price and watch what happens. | This Week's Challenge: Block two hours tomorrow morning, tell your team you're unreachable during them, and keep a running list of everything that still reaches you. Bring it to your next Level 10 meeting and sort each item into "shouldn't have reached me" or "nobody owns this." The second pile is your next Rock. |
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| | We hope you found this helpful — any feedback is appreciated and can be shared by hitting reply or using the feedback feature below. | Was this email forwarded to you? Subscribe here. Have an idea or issue to share? Email us. Connect with us using your preferred social media and website links for MyLandTrustee and Aspire Legal Solutions. My Land Trustee mailing address: PO Box 547945, Orlando, FL 32854-7945 Aspire Legal Solution mailing address: PO Box 547934, Orlando, FL 32854-7934 Our physical address: 1901 West Colonial Drive, First Floor, Orlando, FL 32804 Our phone number: (844) 842-2774
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