The California Department of Insurance is serious about complying with SB133 legislation where NO value may be give to real estate professionals. Here is one of their current press releases.
Commissioner Poizner Announces More Disciplinary
Actions Under New Title Insurance Law
Second Suspension Taken Against a Title Marketing Representative This Week
Continuing his efforts to crack down on illegal title marketing practices, Insurance Commissioner Steve Poizner announced today that the Department of Insurance has reached an agreement with Carmen Rojo and her employer Nations Title Company of California to resolve allegations of illegal rebating activities.
"Illegal rebates drive up prices for consumers and it turns out that giving away free lunches at a seminar for realtors and lenders cost a title marketing representative much more than the price of the meal," said Commissioner Poizner. "Because we now have the ability to punish both the title marketing representative in addition to the title company, this new authority will curb marketing abuses in the industry."
Under the settlement, Rojo agreed to halt these activities and to a suspension of her certificate of registration for 20 days. She will not be able to market and sell title insurance during that time. Separately, Nations Title Company of California agreed to pay $4,000 in penalties and $1,000 to CDI for the reimbursement of attorney fees and costs.
In March 2009, CDI began investigating and examining the marketing practices of Rojo and her employer Nations Title Company of California after receiving written complaints alleging illegal rebating activities. The Department investigated marketing activities in Nations Title Company of California's Norwalk office since January 1, 2009. Based on results of the investigation, CDI alleged that Rojo presented an offsite educational seminar for realtors and lenders on Feb. 25, 2009. The topics included bankruptcy, loan modifications and marketing, and overcoming fear and goal setting. The seminar was advertised via fliers distributed by Rojo. It is illegal to provide educational programs that are not exclusively related to title insurance business. In addition, a complimentary lunch was provided to the approximately 50 realtors and lenders at the seminar. The cost of the food and beverages and other costs associated with putting on the seminar is estimated at more than $2,100.
Prior to the new legislation (SB 133) sponsored by the California Land Title Association, the Department of Insurance had no enforcement authority over the individual title marketing representatives who engaged in illegal rebating activities. While the practices were illegal, the Department only had recourse against the title insurers. Under the new law, effective January 1, 2009, the Department is authorized to bring administrative actions against individual title marketing representatives along with title insurers who engage in illegal practices to refer title business.
The new law establishes zero tolerance for enticing realtors and lenders with food or beverage or entertainment as an inducement to refer title business. Additionally, it provides the Department with regulatory oversight of title marketing representatives by establishing a certification program and disciplinary action including the imposition of a monetary penalty to be paid out of personal funds and suspension of the certificate of registration. A title marketing representative must hold a valid certificate of registration from CDI to act in that capacity. To date, CDI has issued 1,913 certificates of registration to title marketing representatives.
Subscribe to CommentsComment