HUD Archives: News Releases

HUD No. 10-006
Brian Sullivan
(202) 708-0685
For Release
January 12, 2010

Company agrees to cease �sham employment arrangement' and will pay up
to $155,000

WASHINGTON - The U.S. Department of Housing and Urban Development and the State of Alaska’s Division of Insurance (Alaska DOI) today announced a legal settlement with Alyeska Title Guaranty Agency for alleged violations of the Real Estate Settlement Procedures Act (RESPA) and Alaska’s anti-rebating law. HUD and Alaska DOI claim Alyeska paid a sham employee for referring consumers to the title company.

Under the terms of the settlement announced today, the Company agrees to cease the alleged sham employment arrangement and will pay up to $155,000 to the U.S. government and the State of Alaska.

“Consumers are the ones who ultimately foot the bill from unethical practices in mortgage transactions,” said David
H. Stevens, HUD’s Assistant Secretary for Housing and Federal Housing Commissioner. “Working closely with our partners in Alaska, we hope this settlement will send a clear message that we have zero tolerance for unethical behavior in mortgage lending.”

Linda Hall, Director of the Alaska Division of Insurance said, "This action should serve as a warning that we expect strict adherence to both RESPA provisions and Alaska insurance statutes and regulations by those involved in the
title insurance and real estate industry."

After a joint investigation, HUD and Alaska DOI alleged that since at least 2003, Alyeska maintained a sham employment arrangement with Kirk Wickersham, owner of FSBO System, Inc. HUD and Alaska DOI allege Wickersham, as a “title marketer,” was paid a percentage of Alyeska’s title insurance premiums in exchange for referrals he made
to Alyeska.

Section 8 of RESPA prohibits a person from giving or accepting anything of value in exchange for the referral of settlement service business. RESPA also prohibits a person from giving or accepting any part of a charge for services that are not performed. Likewise, the State of Alaska’s anti-rebating statute (AS § 21.66.310) prohibits title companies and their agents from giving anything of value, directly or indirectly, as an inducement to obtaining title insurance business. In addition, state law prohibits a person in the real estate services industry, or any other
person, from receiving, directly or indirectly, any rebate, reduction, or a special favor or advantage, or a monetary consideration or inducement.

To read the settlement agreement announced today, visit HUD's website.


HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the need for quality affordable rental homes: utilize housing as a platform for improving quality of life; build inclusive and sustainable communities free from discrimination; and transform the way HUD does business. More information about HUD and its programs is available on the Internet at and



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