SAN FRANCISCO (KGO) -- Lawmakers are responding to a 7 On Your Side investigation that uncovered what the city attorney is calling an "unlawful scheme" of "fraud."

It involves alleged squatters... alleged forged deeds... and a $4 million home in San Francisco's Sea Cliff neighborhood.

So, what's being done to prevent this? 7 On Your Side investigated whether California has enough legal protections for property owners.

Families who live next door say they reported this problem for a year. But in states like Georgia, the people accused would have had to prove they belong there within 72 business hours.

A judge has granted a temporary restraining order against two alleged squatters who authorities say appear to have taken over this $4 million home in San Francisco's Sea Cliff neighborhood for a year.

"We went to court... to ensure that these two fraudsters who are trying to steal the property from each other and from the rightful property owner don't have the ability to either transfer or sell the property during the course of this lawsuit," said San Francisco city attorney David Chiu.

Stephanie Sierra: "Why did it take a year to file this?"
City Attorney David Chiu: "This was brought to my attention in July... I understand that there were a number of other city agencies looking into this... But we felt that we had to act."

The San Francisco City Attorney's Office filed a lawsuit against the alleged squatters this month -- the only city agency to take action after records show dozens of complaints were filed to numerous city agencies a year ago.

"They need to get them out," one neighbor said.

That might be possible in states like Florida, Alabama, Tennessee, Texas, South Carolina and Georgia -- which have all recently passed anti-squatting laws allowing law enforcement to remove unauthorized occupants.

For example, the Georgia Squatter Reform Act requires anyone accused of squatting to produce a valid lease or proof of legal residency within 72 business hours or face arrest and removal.

But not every squatter case looks like the Sea Cliff dispute. Lawmakers say the term can cover anything from alleged fraud to someone who simply fell behind on rent.

"California has work to do when compared to these other states. What gaps do you see in the law today?" Stephanie Sierra asked Santa Ana state Sen. Tom Umberg (D-Santa Ana).

Umberg authored legislation this year that would've enabled a faster process for property owners to remove trespassers or squatters and reclaim their property. It would've also allowed law enforcement to act and imposed penalties for fraud.

Sen. Umberg: "Stephanie, I think you've pinpointed it -- the gap is that we treat squatters the same as someone who simply overstayed their lease. We need to address them as trespassers, as those who never had a right to occupy the premises and should be basically removed, if necessary. Forcibly removed. If they don't leave... then the law enforcement authorities need to remove them."

Umberg's bill aimed to close what he says are legal loopholes that allowed trespassers to remain in properties for months or years through forged documents or false claims of rights, forcing owners into slow, costly eviction proceedings. It would've enabled a faster removal process and imposed penalties for fraud. It passed every committee, but died before reaching a Senate floor vote.

Sierra: "Why do you think it failed?"
Umberg: "I'd like to think it was a misunderstanding. A misunderstanding whether we're talking about someone who can't pay their rent... and had been lawfully occupying the premises... versus someone who found a vacant home -- in this case in Sea Cliff, a very valuable home."

Read more here: ABC 7