Good, solid Title Underwriters continue to pay the price for poor agent handling during busy times. When the market was overwhelmed with business, many title underwriters signed as many title insurance agents as they could find, and the result was those agents were entrusted with billions of dollars in customer trust funds. With the volume of transactions and the phenomenal number of agents, it became much too difficult to keep an eye on the prize – the money that is. Even with the idea of separating the handling of funds through Agent Contracts and the issuing of Insured Closing Letters from the liability of insuring titles, there has been and continues to be much room for risk and litigation. That reared its ugly head again yesterday in a report about a lawsuit against Stewart Title. According to the article:
Executives at Stewart Title “aided and abetted” the plundering of tens of millions of dollars alleges a federal lawsuit. The lawsuit seeks damages in excess of $40 million from Texas-based Stewart Title. An attorney representing Stewart said Monday the company does not comment on pending litigation. Read more here at Southtown Star.