Sunday, October 14, 2007

Fort Ligonier Days and Las Vegas

[An accusation filed with the state Department of Corporations, which issues finance licenses, says that in April and May, Sadek obtained markers worth $1.02 million for gambling at the Wynn Las Vegas and Bellagio casinos based on funds from his company, Platinum Coast Escrow.]

I read this account of an escrow agent out of control and it took me back to the day - a few years ago when Sue Dougherty's checks started bouncing.....

It was the Friday of Fort Ligonier Days, the second weekend in October, and I had allowed most of the staff the day off. Gina had offered to work because she lived in town and didn't have to worry about parking. We both manned the phones and hoped for a quiet day.

It was pretty quiet so around 4 o'clock I thanked Gina and let her take off to join her friends. That's when I got the phone call.

A panic stricken mortgage broker in Indiana County called to say the title agent she normally used had tapped the escrow account, gone to Las Vegas and all of the checks were bouncing. The mortgage broker had a transaction that HAD to close that weekend for some reason or other and she wanted desperately to know if we could do it........

I remember loads of phone calls back and forth with Nancy, the escrow office manager, trying to get the abstract and lien letters and then frantic calls to the mortgage lender to see if we could switch the file. It was an hour during which I really tried to help these folks because nothing galls me more than a thief in my business and I feel for consumers who suffer in their hands.

Two members of my staff were intimately involved with Sue. JC used to work for her. MW was a loan originator who referred title work. Everybody loved Sue and no one wanted to believe she was a thief.

JC worked there long enough to see that something just wasn't right. He left the position without another lined up just to get out. He started working for our office roughly three months before Sue's house of cards fell down.

MW came to work for us several months later. She recalls sitting in Sue's office demanding money for her borrowers and sellers and telling them she wasn't going to leave until she got it.

Sue blamed everybody but herself. She insisted it was the fault of her employees or her business partner. Most people believed her, but her employees knew the truth. JC knew the truth.

I notice in the article about Sadek and Platinum Escrow that a former employee had tried to speak out and was fired.

[A wrongful termination lawsuit filed against Sadek in 2006 also accused him of using $1 million in escrow funds for gambling markers at the Bellagio. In a May 2 interview, Sadek denied using escrow funds, saying that "the check was a mistake and never cashed and never written out of the company."]

Sue's in jail now and she owes close to a million to Stewart Title. She harmed many people but I think there are still people who want to believe it wasn't her fault. I would not be surprised if she tried to open another title agency when she gets out. Maybe she'll go to another state that has lousy licensing laws.

You know, there are states that don't pay attention to whose watching all of that money. That's a crime of sorts in my book as I believe states have an obligation to protect the public and the sooner states embrace the idea that the business of title insurance and real estate conveyance is one demanding a high level of trust, the less we'll hear about crooks like Sue and Sadek.

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