Monday, May 28, 2007

Missouri Feds Convict Title Insurance Agent Of Stealing $3 Million+ In Escrow Funds

The St. Louis Post-Dispatch recently ran a story that should serve as a caution to anyone using the services of title agents to handle closing / escrow services in connection with real estate transactions. It tells the story of one Missouri victim who had $50,000 stolen by title insurance agent Norvel Brown who, when added to the thefts from other victims, made off with over $3 million in escrow money that he was entrusted to hold for others. A Missouri Federal judge sentenced him last week to 63 months in prison and 3 years probation. He also has been ordered to pay over $3.2 million in restitution to his victims.

Reportedly, Missouri doesn't restrict what title agents do with escrow money. According to Doug Ommen, the new director of the Missouri Department of Insurance, "What we have seen in the St. Louis area is, the agencies get into a squeeze because of competition. [...] They have been dipping into those funds that do not belong to them, to cover expenses. [...] It's shocking to me that there are no restrictions on the use of those funds."

Missouri insurance regulators also warned recently that some companies that sell title insurance to homeowners have two sets of prices - one for sophisticated buyers and a second for everyone else. For more, see

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