LOS ANGELES, April 14, 2016 /PRNewswire/ -- RE-Insider today reported that a Judge in a class action lawsuit against Fidelity's Disclosure Source and Valley NHD ("defendants"), and others, Case No. C 15-02030, has ruled against the defendants' demurrer and will continue the class action suit. As a result, the defendants in the case still face possible charges over allegations of illicit RESPA violations, including illegal kickbacks and fraud, and fines that equate to triple the profit made.
In this story: Agents and Broker Named in NHD Kickback Class Action Lawsuit revealed a class action lawsuit filed against real estate broker Paul M. Zagaris "PMZ", five of his top producing real estate agents and two natural hazard disclosure companies, Fidelity's Disclosure Source and Valley NHD, for violation of California Civil code 1710 (3), California Business and Prof. Code 17200, fraud and others. The Plaintiffs allege, amongst other things, that Disclosure Source and Valley NHD conspired to earn secret profits through an elaborate illegal kickback scheme.
The plaintiffs in this case represent a Class of people that have employed the services of PMZ during a period of time to buy or sell a residential home in California, in which a natural hazard disclosure (NHD) report was provided by Valley NHD. Plaintiffs allege that the Brokerage white labeled a Disclosure Source NHD report that it purchased for approximately $40.00, and resold it to the Sellers for $89.00, without making any enhancements to the report that would account for the additional cost to the client. This type of resale is the epitome of a RESPA violation. Additionally, this business arrangement was kept a secret from the Seller, who had a right to know the Broker had a financial interest in the NHD report that was chosen.
On March 24, Judge Barry Goode denied the defendants' plea to dismiss the charges, indicating that the most serious of allegations remain and will move forward in the court system.
For more information, read the full story at: http://re-insider.com/2016/04/14/claims-fidelitys-disclosure-source-broker-upheld-nhd-kickback-scheme-lawsuit/
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