Insurance Inquiry Widens

California Insurance Commissioner John Garamendi said Wednesday that he had sent subpoenas to Wells Fargo & Co. and five other companies as part of a probe into possible fraud among title insurers.

The subpoenas went to Wells Fargo Home Mortgage, Los Angeles-based builder KB Home, Newport Beach-based builder William Lyon Homes, real estate franchisor Re/Max International Inc., United Home Mortgage Corp. and Shea Financial Services.

The subpoenas are requests for information and documents as well as for company officials to appear at a hearing April 4.

Two weeks ago, Garamendi subpoenaed title insurers Fidelity National Financial Inc. and LandAmerica Financial Group Inc., claiming he had evidence of millions of dollars in illegal payments to builders, mortgage lenders and real estate agents in exchange for referrals.

The alleged kickbacks drove up the cost of title insurance for some homeowners, he said.

California, Colorado and several other states are probing the alleged schemes that involve so-called captive reinsurance agreements. On Wednesday, KB Home said it has stopped participating in such programs.

. “We look forward to the opportunity to discuss the matter and provide any information that may be useful to Commissioner Garamendi,” said spokeswoman Kate Mulhearn

San Francisco-based Wells Fargo said it hadn’t made any illegal payments related to title insurance.