Spitzer probing big title insurers
BY CARRIE MASON-DRAFFEN, STAFF WRITER
March 3, 2006
State Attorney General Eliot Spitzer is investigating some of the biggest players in the title insurance industry to determine if they made illegal payments to boost business.
The attorney general's office has been investigating for several months, said a source close to the probe. But it's too early to tell what the outcome will be, the source said yesterday.
The companies under the microscope include First American Title Insurance Co., Fidelity National Title Group Inc., LandAmerica Financial Group Inc. and Stewart Title Guaranty Co., according to a report yesterday in The Wall Street Journal.
A spokeswoman for LandAmerica, which is based in Richmond, Va., and has offices in New York, stressed that the investigation "is still in the discovery stage and we continue to respond as requests come in."
The attorney general's office declined to give details about the probe. But according to the Journal, Spitzer is investigating whether the companies paid millions of dollars in insurance-premium rebates to some large favored customers, such as real estate developers. The office also is looking at whether the title companies paid referral fees to their agents, mortgage brokers and attorneys who delivered clients. New York state bans such payments.
Authorities contend such payouts could raise title-insurance costs for millions of homeowners in New York state, the Journal reported. Nearly all homeowners buy title insurance because most banks require it.
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