if there was a misrepresentation, whether Commonwealth Land was obligated to communicate this
error to Plaintiffs.
i. The HUD-1 Statement Furthers the Scheme to Defraud.
Defendant maintains that the HUD-1 statement is a fair and accurate reflection of the amount
Plaintiff paid - in effect, it is a receipt, no more, no less. Defendant further argues that since the
HUD-1 itself contains no false statement, it can not be the basis of federal mail or wire fraud because
the HUD-1 does not make a representation of the correctness of the charges for the title insurance,
citing Arthur v. Ticor Title Ins. Co. of Fla., 569 F.3d 154, 162 n.3 (4th Cir. 2009).9
Regardless of how one views the HUD-1, Plaintiffs have alleged facts which raise the
inference that the HUD-1 served as a step in the plot to cause pecuniary loss to innocent purchasers
of title insurance, and the creation of the HUD-1 was an incidental part of the scheme, even if it
merely reflected the amount paid by the purchaser. Plaintiffs allege that the amount charged for title
insurance as reflected on the HUD-1 is materially incorrect. The information on the HUD-1 would
lull title insurance purchasers into believing that the amount listed represents the correct statutory
rate when it does not. Although on its face a HUD-1 shows the amount charged and collected by a
title insurance company and in this sense may not be a misrepresentation as argued by Defendant,
9 In Ticor, a recent Fourth Circuit decision, plaintiffs alleged factually similar patterns of deliberate overcharging for title insurance under the Maryland Insurance Code and Real Estate Settlement Procedures Act, 12 U.S.C. § 2601, et seq. (“RESPA”). The Fourth Circuit affirmed the district court’s dismissal of plaintiffs’ claims under RESPA. Id. at 157. The court, in dismissing the claim for negligent misrepresentation, stated in a footnote that plaintiffs did “not validly assert that Ticor made any false statements” on the HUD-1 because the statement simply reflected the amount charged and collected by Ticor. Id. at 162 n.3. Ticor is distinguishable from the instant case because it did not involve an allegation of a scheme to defraud under the mail and wire fraud statutes.