MN Department of Commerce Smack Down

by Teresa Boardman, on 29 March 2007

Consumers paying too much for title insurance to support kickbacks and illegal referrals

ALERT – Sent By MAR
MINNESOTA DEPARTMENT OF COMMERCE
ENFORCEMENT ACTIONS REGARDING AFFILIATED BUSINESS ARRANGEMENTS
Recently the Minnesota Department of Commerce has sent out a large number of enforcement letters to real estate agents regarding alleged RESPA and Minnesota law violations. What are the allegations and what should agents do if they receive such a letter?

While the alleged violations may vary depending on the facts of each case, the basic allegations are:
a) Accepting kickbacks, rebates or other things of value for the referral of a sham affiliated business arrangement;
b) By urging homeowners to purchase a title insurance policy, the agent is soliciting the sale of title insurance without being licensed as a title insurance agent;
c) Failing to act in the best interests of the client;
d) Failing to either completely or accurately disclose the agent’s affiliated business arrangement with the joint venture. Read more