State goes after licenses of Guaranty Title managers
|December 11, 2007|
JEFFERSON CITY, Mo. -- The Department of Insurance, Financial Institutions and Professional Registration said Monday that it filed a complaint against Guaranty Title Company, Guaranty Title Company of Southwest Missouri, Rick Burton of Nixa, Kathy Stanton (Allen) of Sarcoxie, and Stephanie Gray of Sarcoxie.
The complaint alleges each person individually and/or collectively failed to remit premium to the insurance underwriter, to disburse funds from escrow accounts with corresponding deposits and to conduct reasonable reconciliations of escrow and disbursement accounts.
"Although we have received information from LandAmerica regarding lost escrow funds, we will continue to look for answers into what caused Guaranty to close its doors,” Doug Ommen said. “This situation demonstrates the importance and need for the legislative reforms passed earlier this year. New laws will allow our department to take action against agencies that misuse or commingle escrow funds and underwriters that don’t actively oversee the work of their title agencies.”
This year the General Assembly passed and Gov. Matt Blunt signed extensive title insurance reform legislation. Senate Bill 66 clarifies a duty to fully disclose to consumers separate price information for insurance premium and for the title search and other services, prohibits misuse or commingling of real estate closing or settlement funds with tight restrictions for deposits and disbursements and requires title insurance companies to actively oversee title agencies writing business on their behalf by conducting annual audits of escrow, underwriting and claims practices.
The Administrative Hearing Commission will conduct a hearing on this issue to determine if the department has sufficient grounds to discipline the business entity producer licenses of each agency and the insurance producer licenses of each producer. The discipline could include revocation of each license.