- September 22, 2017
- All California, Florida, Hawaii, and Texas Issuing Offices
- UNDERWRITING - US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) - Geographic Targeting Order
This bulletin is continuing guidance on the FinCEN Geographic Targeting Orders (GTO), which were issued to all underwriters. The new GTO will be effective on September 22, 2017. As a reminder, the GTO has defined a covered business to include Stewart Title Guaranty Company, Stewart Title Insurance Company, and its families of companies and authorized title agents. As suggested in prior bulletins on this matter, Stewart advises you to alert your customers and proposed insured of the NEW GTO reporting requirements outlined below. THE NEW REPORTING REQUIREMENTS ARE EFFECTIVE SEPTEMBER 22, 2017, UNTIL MARCH 20, 2018.
The GTO has defined a covered transaction as any transaction that would close from September 22, 2017, to March 20, 2018, involving:
1. Residential real property located in the Boroughs of Manhattan, Bronx, Brooklyn, Queens and Staten Island in the City of New York, State of New York, and Bexar County, Texas, and Miami-Dade, Broward or Palm Beach Counties, Florida and San Diego, Los Angeles, San Francisco, San Mateo and Santa Clara Counties, California, and City and County of Honolulu Hawaii.
2. The proposed insured/buyer is a Legal Entity, defined under the GTO as a corporation, limited liability Company, partnership or other similar business entity whether formed under the laws of New York, any other state, in the United States or a foreign jurisdiction. Individuals and Trusts are not a defined Entity.
3. Consideration of:
A) $3,000,000 or more in Manhattan and $1,500,000.00 or more in Bronx, Brooklyn, Queens and Staten Island, New York.
B) $500,000.00 or more Bexar County Texas.
C) $1,000,000.00 or more Miami-Date, Broward, Palm Beach Counties Florida.
D) $2,000,000.00 or more San Diego, Los Angles, San Francisco, San Mateo or Santa Clara counties California.
E) $3,000,000.00 or more City and County of Honolulu Hawaii.
4. Without a loan or similar form of external financing from a financial institution. The reporting exclusion is only triggered by loans financed by a financial institution. Financing from a private lender, seller or other business is considered a reportable transaction.
5. Any portion of the purchase price is paid using currency, cashier’s check, certified check, traveler’s check, money order, personal check or business check. (Attorney trust or escrow check are considered a business checks for reporting purposes) or FUNDS TRANSFER (wire transfer). There is no de minimums amount below which the reporting is not triggered. Payment of only the settlement services by any of the listed methods does not trigger the reporting requirement.
In the event a transactions meets the above criteria, the IRS/FinCEN 8300 form must be completed and reported to FinCEN within thirty (30) days of the closing and must include the following:
1. Identity of the individual primarily responsible for representing the Legal Entity.
a. A description of the identification (driver’s license, passport or other similar identifying document) responsible for representing the Purchaser, with a copy retained in the file.
2. Identity of the Purchaser and any Beneficial Owner(s) of the Purchaser’s.
a. A description of the type of identification, driver’s license. Passport or other similar identifying document obtained from the Beneficial Owner, with a copy retained in the file.
b. Any person or entity owning 25% or more of the purchasing entity is a “beneficial owner” and must be reported. If an entity is a member of the purchasing entity, members of that entity must be reported.
3. Date of closing of the Covered Transaction.
4. Total amount transferred in the form of a monetary instrument
5. Total purchase price of the Covered Transaction.
6. Address of the real property involved in the Covered Transaction.
7. Also, include the term “REGTO” as a unique identifier for this GTO in the Comments section. (Note Change)
In the event a party will not provide the information on a covered transaction, you may not issue the title insurance policy without written authority from Stewart.
As a covered business, all offices and agents are required to file IRS/FinCEN form 8300 directly with FinCEN within thirty (30) days of closing on all covered transactions for as long as the order is in place. All offices and agents are required to report evidence of the filing, including the identification of the beneficial owner, to Stewart via the over limits/high liability system prior to closing or if not known prior to closing, then post-closing. A copy of the form 8300 completed and signed together with the required beneficial owner identification and legible copies of the proofs taken should be attached to an over limits form and submitted to:
Policyapprovalrequest@stewart.com. You will not receive an approval of the submission. This submission is for record keeping and auditing purposes.
In our continuing effort to advise you on this matter and to assist in the reporting, attachedplease find the ALTA Real Estate Geographic Targeting Orders Fact Sheet and FinCEN Certification Form to be used at or prior to closing.This form is available in a Print-and-Write form and a Fill-In form. In addition to being attached to this bulletin, it is also available to download from our website. ALTA is in the process of updating these forms to include wire transfers. Please review the form and make sure that you are complying with the order if payment is made by wire transfer.
All offices and agents must retain all records relating to compliance with the Order for a period of five (5) years from the last day that this order is effective (including any renewals of the Order).
Failure to report can subject the company or any of its employees to a fine and/or penalty. Penalties can be assessed any time within six (6) years from the date of the Covered Transaction. Civil actions may be commenced within two (2) years of the date of the penalty or criminal conviction.
The following exception is to be included in every title report for a transaction involving property located within the City of New York:
As a result of the Geographic Targeting Order (GTO) the IRS Form 8300 must be completed and delivered prior to or at the closing if the transaction meets the following criteria:
1. The residential property to be insured located in the Boroughs of Manhattan, Bronx, Brooklyn, Queens and Staten Island in the City of New York, State of New York, or Bexar County, Texas, or Miami-Dade, Broward or Palm Beach Counties, Florida and San Diego, Los Angeles, San Francisco, San Mateo and Santa Clara Counties, California, or City and County of Honolulu Hawaii;
2. Proposed insured/buyer is a legal entity, defined under the GTO as a corporation, limited liability company, partnership or other similar business entity whether formed under the laws of New York, Texas, Florida, California, Hawaii, any other state, the United States or foreign jurisdiction;
3. Consideration of more than $3 million in Manhattan and $1.5 million in Brooklyn, Bronx, Queens and Staten Island in New York or consideration of more than $500,000 in Bexar County, Texas or consideration of $1,000,000 or more in the Florida Counties of Miami-Dade, Broward, or Palm Beach or consideration of more than $2,000,000 in the California counties of San Diego, Los Angeles, San Francisco, San Mateo or
Santa Clara or consideration of more than $3,000,000 in the City and County of Honolulu in Hawaii;
4. It is an all-cash transaction (including cashier’s check, certified check, traveler’s check or money order, personal or business check) or financing is provided by a private lender, seller or other business or the use of a Funds Transfer/Wire Transfer.
In the event you have any questions, please contact your Stewart Title Underwriter.
If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.
For online viewing of this and other bulletins, please log onto www.vuwriter.com.
THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.
- Bulletins Replaced:
- Related Bulletins:
- MU2016002 UNDERWRITING - US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) - Geographic Targeting Order
- MU2016003 UNDERWRITING - US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) - Geographic Targeting Order
- Underwriting Manual:
- Exceptions Manual: