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Homeowners are claiming in a federal class action lawsuit that Fidelity National Title Insurance and other major title insurers paid millions of dollars in illegal kickbacks and referral fees to “hundreds, if not thousands” of real estate agents and brokers. As a result, homebuyers paid inflated costs for settlement services, they say.
The class action lawsuit claims the title insurers violated the Real Estate Settlement Procedures Act (RESPA), which protects homebuyers by prohibiting kickbacks and fees for real estate settlement services in federal-backed mortgage loans.
The scheme was allegedly accomplished by using a web-based platform called TransactionPoint, which “allowed kickbacks and referral fees to be disguised as ‘sublicense fees’ or ‘access fees,’” the class action lawsuit says.
“Through TransactionPoint, agents or brokers selected real estate settlement service providers for real estate transactions and, in turn, real estate brokers and agents entered into standard form sublicensing agreements with vendors, including defendants, to enable the vendors to be listed and selected through TransactionPoint as service providers for the transaction,” the class action lawsuit states.
“In short, the scheme allowed defendants and participating real estate agents and brokers to camouflage illegal kickbacks and referral fees as sub-license payments.”
The class action lawsuit claims Fidelity evaded federal and state regulators for years, until the U.S. government investigated Fidelity’s RESPA violations in 2009. Fidelity settled the investigation by promising to pay a $4.5 million settlement and terminating TransactionPoint fee payments.
Also named as Defendants in the class action lawsuit are Commonwealth Land Title Co., Chicago Title Co., Ticor Title Co. of California, Lawyers Title Co., Fidelity National Disclosure Source LLC, Fidelity National Financial, Inc., Lawyers Title Co., and Fidelity National Home Warranty Co.
The Fidelity RESPA Class Action Lawsuit is seeking restitution and treble damages for RESPA violations.
The case is Matthias Hildebrandt, et al. Fidelity National Financial, et al., Case No. 12-cv-00874, U.S. District Court, California Central Court.
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2 thoughts onFidelity National Title RESPA Class Action Lawsuit
This anonymous claim is baseless and has been written by a former employee who is engaged in a smear campaign against Linear Title. Linear Title maintains an A+ rating with the BBB, is a member of the INC5000 list and is a SSAE 16 certified company with a sterling reputation. For any questions about Linear Title, please contact our compliance department immediately at 888-554-6327 or by emailing compliance@lineartitle.com.
This is just typical of this industry. I just got a mortgage from Amerisave and I am quite sure they were kicking back to their title insurance company Linear Title out of Rhode Island. They told me that we must use Linear Title.