D.C. Hits Title Companies, Shutters Joint Ventures

The District of Columbia Office of the Attorney General (OAG) recently announced four settlements, totaling over $3.2 million, with four title companies, and their affiliates, operating in D.C., over allegations that the title companies used joint venture title agencies with real estate agents to compensate those agents for referrals, in violation of D.C.’s Consumer Protection Procedure Act (CPPA).

According to OAG, the companies provided the agents with opportunities to purchase ownership interests in the joint ventures at preferential rates, as remuneration for referrals of title business.  OAG further stated, concerning title business, that “[w]hile federal law allows for certain affiliated business arrangements that meet specific requirements, District law is more stringent and does not have such an exception.”

Pursuant to the companies’ four separate agreements with OAG, the companies will pay varying amounts in settlement to D.C., of which up to a total of $1.75 million of the funds will be used by D.C. to provide restitution to affected consumers.  In addition, the companies all agreed to cease the alleged practices, including the use of these joint venture structures.