Santa Clarita / Antelope Valley : State Bars Escrow Firm Co-Owner From Business : Investigation: Kathy Weiner is accused of helping husband embezzle $2.8 million from company’s customers.

SANTA CLARITA —  The state concluded its investigation into what reportedly was California’s largest incident of escrow fraud Wednesday by barring a woman from the industry who allegedly helped her husband embezzle $2.8 million from customers.

Kathy Wiener, co-owner of the defunct Country Oaks Escrow Inc., is accused of participating in a variety of schemes to use the embezzled funds to run the Valencia-based company and pay for personal expenses. Her husband, Harold, was similarly barred from working in the state’s escrow industry Aug. 30, 1993.

Kathy Wiener left her Newhall home after the state Department of Corporations closed Country Oaks on June 4, 1993. Department spokeswoman Lindsey Kozberg said that officials finally found Wiener in Utah earlier this month and served her with the required papers notifying her of the state’s intention to bar her from the escrow industry.

“With the cooperation of Utah securities regulators, we were able to contact and serve her when she appeared for a bankruptcy court proceeding,” Kozberg said.

The Wieners are accused of stealing the money from four company trust accounts between 1991 and 1993. The trust accounts contained about $4.48-million worth of buyers’ deposits when the state seized the company and froze the accounts, leaving about 2,000 real estate transactions temporarily in limbo.

Much of the money went to operate the escrow company and other businesses owned by the Wieners, according to investigators. But, investigators said, some of it was diverted into the couple’s personal bank accounts to support what their neighbors called a lavish lifestyle.

Attempts to reach the couple Wednesday were unsuccessful. They have denied any wrongdoing in civil lawsuits against four pharmaceutical companies who allegedly manufactured prescription medicine impairing Harold Wiener’s ability to “tell right from wrong.”

The company’s auditor, the firm of Martin & Hedman, is also named in the lawsuit and is accused of negligence by failing to detect the shortfall.

The Los Angeles County district attorney’s office still is investigating the case to determine if criminal charges will be filed. Also pending is a civil lawsuit against the Wieners filed by Escrow Agents Fidelity Corp., which is seeking to reclaim the money it paid to the state to insure the shortfall.

Burrow Escrow Co. took over Country Oaks’ accounts June 8, 1993, and virtually all customers with money in the trust accounts have been reimbursed since, officials said.

“Fortunately, Country Oaks was insured for the trust-fund shortage, and its borrowers did not incur any losses,” Gary S. Mendoza, commissioner of the Department of Corporations, said in a prepared statement. “Barring the Wieners from this industry should prevent them from taking advantage of any other California consumers.”

Kozberg said the state’s action prohibits the Wieners from managing or working for any escrow agent in California. She said the Department of Corporations does not have the authority to prevent the couple from escrow work in other states, but information about the ban is available to regulating agencies outside California.