The Consumer Financial Protection Bureau yesterday fined real estate settlement services provider Meridian Title Corp. over violations of the Real Estate Settlement Procedures Act, ordering the company to pay up to $1.25 million to harmed consumers, HousingWire.com reported. The CFPB stated that the South Bend, Indiana-based company routinely steered consumers to Arsenal Insurance Corporation, a title insurer company owned in part by three of Meridian’s own executives. As a title insurance agent, Meridian receives orders for title insurance policies from lenders and real estate agents, and in some cases directly from consumers, and assigns those orders to title insurance underwriters, the CFPB explained. By steering consumers to Arsenal Insurance and not disclosing its relationship with the title insurer, Meridian Title illegally benefitted from the referrals for title insurance, the CFPB claims. Meridian was able to keep extra money beyond the commission it would normally have been entitled to collect, based on an understanding that Meridian would select Arsenal as underwriter, according to the CFPB.
