News

November 22, 2008

Secret Service investigation in Kingston prompts more property owners to come forward

Kingston title search company allegedly didn’t disburse funds after house sales.

By Jennifer Learn-Andes jandes@timesleader.com
Luzerne County Reporter
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More property buyers and sellers have come forward with complaints about a Kingston title search company that is under investigation by the U.S. Secret Service.

The investigation of Priority Search Inc. became public Thursday when Wright Township Police Chief Joe Jacob said the federal agency is handling a complaint that the Kingston business failed to turn over $171,317 to the seller of a township property.

Title companies are supposed to put property purchase funds in an escrow account and then make sure the money is properly disbursed to the seller and, if applicable, banks that hold the seller’s original mortgage.

Scranton attorney John Dean, who represents the Wright Township property seller, Bill Jones, said he fielded numerous calls Friday from other lawyers whose clients are owed money by Priority Search.

“I’ve been on the phone all day with attorneys who have clients in the same position as Bill,” Dean said. “It seems to be a wide-ranging net.”

Dean said he also verified Friday that the insurance company representing Priority Search has filed a lawsuit against the company and its principals – Elizabeth Sichler and Robert E. Marsh – in the Luzerne County Court of Common Pleas.

That suit, filed by North Carolina-based Investors Title Insurance Co., identifies three other clients who “went through the same thing as Mr. Jones,” Dean said. A county judge ordered Priority Search to turn over its documents and computer records to the insurance company, Dean said.

Jones has also filed suit against Priority Search and its principals.

“We are going to pursue this vigorously, get to the bottom of this and get Bill his money,” Dean said.

Several property owners also contacted The Times Leader Friday to report claims of money owed by Priority Search.

Michael Bogdon said he borrowed more than $170,000 to buy a house in Rice Township, and the cash was given to Priority Search around the time of the Aug. 22 property closing.

Bogdon gutted and remodeled the home since then and was in a state of disbelief when the seller showed up at his doorstep about two weeks ago to inform him that Priority Search had never turned over the money.

Some of the funds were supposed to pay off the sellers’ old mortgage, and now the sellers – who are retirees – have outstanding mortgages on both their former and new houses, Bogdon said.

“My blood started pumping. How will this affect us?” Bogdon said. “Every last dime we had is in this house now. It’s scary.”

Bogdon said the Realtor had chosen Priority Search as the title company. He recently learned that Priority Search also failed to pay the property taxes as required.

Another property owner, John Buhay, said he’s in danger of losing his home in Dauphin County because Priority Search failed to pay off his $165,000 mortgage to CitiMortgage when he refinanced and secured a new mortgage.

Now CitiMortgage is threatening to foreclose on the property on Dec. 19, but he can’t afford to pay two mortgages. To make matters worse, Buhay said he and his wife must relocate to Delaware for their jobs, and they can’t sell the home until the old mortgage is satisfied because buyers won’t touch a property that doesn’t have a clean title.

“Our credit is being destroyed by this,” Buhay said. “You work all your life to try to do the right thing and make payments on time and then somebody comes along and in a matter of seconds, destroys it all.”

Gateway Funding, which handled Buhay’s new mortgage, has filed a claim with Investors Title Insurance Co. to try to recoup the $165,000 owed to CitiMortgage, said Linda Cramer, manager of Gateway’s Lancaster branch.

Cramer said the $165,000 had been wired to Priority Search on Aug. 29.

“We’re doing whatever we can to help Mr. Buhay,” Cramer said.

Buhay said he picked Priority Search as the title company because his friend had recommended the Kingston business. His friend is also out money because of a property sale transaction that went through Priority Search, Buhay said.

Cramer said Priority Search has been added to Gateway’s “do not use list” of title companies. However, the ban may be unnecessary at this stage because Priority Search has a closed sign in the door and a for sale sign out front.

Buhay said he filed a report with his local police department Friday when he learned about the Secret Service investigation. He said Sichler, president of Priority Search, has stopped returning his calls. Her lawyer – Philadelphia criminal defense attorney Marc Neff – won’t respond to his messages, he said.

Neff, Sichler and Marsh could not be reached for comment Thursday or Friday.

Law enforcement officials urge property owners to contact local police and/or the Secret Service if they have experienced problems with Priority Search. The Secret Service’s Scranton branch phone number is 346-5781.

Jennifer Learn-Andes, a Times Leader staff writer, may be reached at 831-7333.

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