Often times nothing is done to these illegal wholesalers because it takes too much time and effort on the part of the State to find and prosecute them, but don't think that you are immune to the legal process if someone in foreclosure takes you to court because they lost their home because you failed to deliver on your purchase contract by attempting to act as an unlicensed broker.Scenario 1:  An investor who invests in real estate and has bought several properties finds a great deal. 

The worst case scenario would be civil asset forfeiture followed by criminal prosecution if the landlord knew the property was being used for criminal purposes.

In addition, any person who knowingly and willfully obtains a consumer report under false pretenses may face criminal prosecution....

Any person who fails to allow this grace period may be criminally prosecuted as a disorderly person. (45) So if you have a 5 day grace period on your lease you're doing so out of the kindness of your heart.  

I will sometimes exchange a first right for not prosecuting back space rent.

My question now is, how could one be prosecuted for wholesaling properties.

There are local and state agencies in most large cities that specialize in prosecuting housing discrimination.

3) If they steal something, how will you prove it was specifically them, so you can prosecute them?

It makes you wonder how they can legally give you false information such as fake identification, pull a credit check (with fake info) and then prosecute.

crazy I know Ive seen 2 separate stories on Inman recently of people being prosecuted for mortgage fraud for flipping properties meant for owner occupants only.