INDIANAPOLIS (Legal Newsline) - Indiana Attorney General Greg Zoeller announced on Monday that his office, thanks to a new state law, has helped customers who were allegedly taken for more than $125,000 by a Chicago-based escrow company recover their money.
American Escrow allegedly defrauded 97 consumers by not paying the taxes and insurance bills that they were required to pay.
"Paying property taxes and insurance is not optional for homeowners," Zoeller said. "Escrow accounts give people a peace of mind that critical bills will be paid on time by money held in trust.
"That peace of mind turned into a nightmare for thousands of homeowners all over the country when they discovered their tax and insurance bills had not been paid and the money had been squandered."
Complaints against the now-defunct company began in 2009, causing attorneys generals from four states - Illinois, Iowa, Michigan and Pennsylvania - to file complaints.
In June, Zoeller filed his own lawsuit against the company, alleging it had violated state consumer protection laws. A January judgment ordered American Escrow to pay more than $600,000 in fines, court costs and restitution to customers. Since the company no longer had any assets, however, the money was uncollectible.
To help, the state passed House Enrolled Act 1332. Under the law, $150,000 was set aside out of a loan broker account held by the securities division of Secretary of State Todd Rokita's office.
The money comes from license registration and renewal fees collected from loan brokers, mortgage loan originators and principal managers, plus fines and penalties paid by brokers violating state law.
"This restitution will not undo the stress or erase the experience of being defrauded, but it will hopefully allow them an opportunity to gain back the financial stability for which they have been fighting," Zoeller said.