Mo. logged 2 conduct complaints over shuttered Guaranty Title

Tuesday, July 3, 2007

SPRINGFIELD, Mo. (AP) -- State regulators say two complaints were filed last year about the conduct of a southwest Missouri title company that closed abruptly last month and whose underwriter says is missing about $4.5 million.

The Missouri Department of Insurance said Tuesday it has two complaints on file from last August and December "regarding the activity" of Nixa-based Guaranty Title Co.

The agency said it also received two complaints about Guaranty in 2005 and 2006 that some agents were not licensed, but those cases were resolved and the licenses were issued.

Department Director Douglas M. Ommen said he could not be more specific about the complaints because they are still under investigation.

However, he said complaints about a title company's conduct could involve issues such as delays in paying title insurance premiums or in filing legal paperwork from real estate closings.

Ommen said the issues raised in the complaints could theoretically point to a problem with a title company's financial soundness.

"The difficulties that started to surface at the end of the year last year sometimes do indicate more serious financial problems," Ommen said in a telephone interview from his Jefferson City office.

Ommen's agency was still investigating those complaints when Guaranty Title closed its doors June 19.

The title company was sued last week for breach of contract by its insurance underwriter, Commonwealth Land Title Insurance Co. The lawsuit, filed in Christian County, alleged that Guaranty was forced to close its doors when its primary bank, Great Southern, froze its accounts for insufficient funds.

Commonwealth claims its auditors found that the title company's escrow accounts were short about $4.5 million.

No attorney is listed on court records for Guaranty Title. Phone numbers listed for two Guaranty officers named as defendants, Kathy Allen and Richard Gene Burton, were not in service.

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