Industry News

Minnesota fines First American $500,000 for alleged sham businesses

Title insurer denies allegations in consent order

First American Title Insurance Co. has agreed to pay a $500,000 civil penalty to Minnesota regulators to settle allegations that it created 35 sham businesses that generated referrals from partners including real estate agents and brokers, mortgage originators, building contractors and land developers. First American, which in December agreed to pay California regulators $10 million to settle accusations that it provided cash payments and other inducements to real estate professionals in exchange for referrals, maintains that the affiliated businesses it created in Minnesota were operated in accordance with state and federal law. In a consent order, First American agreed to close the businesses down, pay a $500,000 penalty, and create educational material for consumers to be posted on the Minnesota Department of Commerce's Web site. "This action is in keeping with First American's previously announced plan to meet with insurance regulators across the nation, share the details of it...

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