Belleville title company sued over missing $400,000

News-DemocratOctober 3, 2013 

An underwriter has sued the title company accused of failing to deliver nearly $400,000 to the Columbia chapter of the American Legion after it sold land to the city.

According to the lawsuit filed in federal court, Metro East Title in Belleville failed to pay the American Legion $385,000 of the proceeds from the sale which closed Aug. 7 after the city paid $475,000 into an escrow account to cover the sale and fees.

That caused underwriter WFG National Title Insurance to review Metro East Title's accounts, and the underwriter alleges that it discovered:

* At least one other case of the company failing to deliver money it was paid for a home purchase to the seller. On July 16, the underwriter said, a couple paid Metro East Title $84,110 to cover the title and fees for the purchase. But when the payoff of $76,865 was sent to Wells Fargo Mortgage, the payment was refused due to insufficient funds.

* That Metro East Title owners Marvin and Karen Steinke made "numerous unauthorized or improper transfers" from escrow accounts to private accounts for their personal use. The underwriter also said they collected fees for services that they did not provide.

American Legion leaders had a meeting this morning at their hall at 375 E. Locust St. The results of the meeting were not revealed. But a member of the organization at the hall Wednesday said he believes the money has not yet been paid.

Calls to Metro East Title by the News-Democrat reached an answering machine and messages were not returned. WFG leaders said in the suit that they have also been unable to make contact with Metro East Title leaders.

Al Hudzik, Columbia city administrator, said the case was referred to local police and the Federal Bureau of Investigation and that the case was still open.

WFG has asked for monetary damages to compensate it for missing money and attorney fees, and asked for an injunction that would prevent Metro East Title from exposing it to more potential liability.

Metro East Title has offices in Belleville and Columbia.

The American Legion post agreed to sell the city about 15 acres of ground where baseball, softball and soccer fields are located because the organization didn't have the ability to keep up the property. Hudsik said the city has leased the property from the American Legion for years and provided maintenance for the grounds. So sports shouldn't be interrupted for the kids who play there.

Contact reporter Scott Wuerz at swuerz@bnd.com or call 239-2626.

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