March 24, 2016
Special Report: Inside the title insurance cartel
By E.B. Solomont in The Real Deal
How the industry became the bulletproof behemoth it is today
On December 10, 2013, regulators summoned the nation’s biggest title insurance firms to 1 State Street.
Much of the hearing focused on the technicalities of title insurance fees and covenants. Representatives of firms in attendance, including Fidelity National, First American, Old Republic, and Stewart, spoke of enabling “the American dream of homeownership.” But then came a question about strip clubs.
Joseph DeSalvo, First American’s senior legal counsel, was asked why his company expensed trips with clients to Blush, a gentleman’s club just off of Route 454 on Long Island.
“Do you think that’s a proper use of premium?” Ellen Buxbaum, a state regulator, asked. “I wouldn’t comment,” DeSalvo replied. But when pressed, he acknowledged that spending millions on wining and dining clients was essential to the business.
“If it’s not entertainment, we would have to market our product in some other fashion,” he said. “So from that standpoint… this has worked out well.”