Lease to own contract

What is the name of your state (only U.S. law)? N.Y.
My wife and I signed a one year lease with option to buy contract on a new home.
We went through a local realtor and the property owner had the contract drawn up by his attorney. We dished out around $6,000 before we moved in for the option fees and security deposit

Now here's the first issue , after the contract was signed (and checks were cashed), we found out from the listing agent that the home did not have a certificate of occupancy....the home was never finished

Now the main problem , around a month ago i had an issue with the property lines , so i went to get the property records at the county office and low and behold the person i am under contract to by the house from doesn't even own it. He sold it to someone else (i think its a relative) to get out of a tax debt.
I also found out the house was sold before we signed the contracts. I talked to the original person I am under contract with about this and he still thinks he owns the property

I am thinking that this is leaning towards fraud

The thing I am wondering is if I can go after the person I am under contract with , and try to get my money back
Also can I go after the realtor to get the realty fee back because the didn't do their research on the ownership and the c of o issue

What does your title report show as to who owns the property?

It shows a different name and address to whom we are under contract with

The person we are under contract with sold the land and property for $50,000 to the current owner that we aren't under contract with

I also did research on the current taxes. the person i'm under contract with is not listed on that either

If your title report showed a different person in title than the party with whom you were contracting, WHY did you close and give them a deposit?

I didn't purchase the home , I am currently under the lease with option contract

As far as the deposit , i gave the checks to my realtor to give to the owner

Correct me if i'm wrong , but aren't realtors supposed to verify ownership and certificate of occupancy on homes , especially on new contstruction

Basically to sum it up , I am under contract to buy a home from a person who legally has no rights to it. He sold the home and property in Jan 2008