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1996 SESSION

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HB 1229 Wet Settlement Act; title insurance.

Introduced by: John J. Davies III | all patrons    ...    notes | add to my profiles

SUMMARY:

Wet Settlement Act; title insurance. Amends the Wet Settlement Act to prohibit settlement agent disbursement of any funds coming into its possession prior to the recordation of settlement instruments (e.g., deed, deed of trust, mortgage, etc.) except for (i) overpayments, (ii) recordation fees, or (iii) funds directed to be disbursed by the provider thereof prior to recordation. The bill also prohibits the payment or receipt of settlement services kickbacks, rebates, commissions and other payments. However, bona fide advertising and marketing promotions are not prohibited, nor is providing educational materials and benefits. Violations of these provisions shall be punishable as misdemeanors. However, any criminal charges brought pursuant to such provisions must be by indictment. Amendments to the title insurance statutes' anti-kickback provisions prohibit compensated referrals for title insurance business. However, sums spent for bona fide advertising and educational materials and benefits do not violate the provisions of this amendment. Additionally, the bill makes clear that neither ownership of a title insurance company, agency or agent, nor receiving a salary or compensation from either violates any anti-kickback prohibition.


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