Attorney General Keith Ellison announced a $3.5 million settlement with Edina Realty, Inc., resolving an investigation into the company's practices related to home warranties. The settlement addresses claims that Edina received secret payments from Home Security of America, Inc. (HSA) for promoting HSA's home warranties to clients without proper disclosure.
As part of the agreement, Edina will provide refunds to certain clients who purchased HSA home warranties and cease relationships with third parties paying for product promotion. Additionally, Edina is prohibited from licensing its name or trademark to market services to its clients.
The investigation found that Edina did not disclose payments from HSA, affecting clients' ability to make informed decisions about purchasing warranties. It also revealed that HSA misled consumers regarding the value of their warranty products and used Edina's name in marketing efforts, potentially confusing customers about the origin of the warranties.
Ellison stated: “Buying a home is the most expensive and significant financial decision most Minnesotans will ever make. Real estate brokers like Edina are legally required to act in the best interests of their clients." He added that Edina violated this duty by accepting payments from HSA without client knowledge.
Eligible customers who bought an HSA warranty after July 1, 2018, can claim a refund if they either had a denied claim within the first year or did not file a claim at all during that period. A claims administrator will reach out to potential recipients regarding compensation.
Minnesota residents who suspect they have been scammed can file complaints with the Attorney General's Office through an online form or contact them via phone.