Bulletin: NY000618

Date:
November 16, 2018
To:
All New York State Agents and Offices
RE:
US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) – Geographic Targeting Order, Manhattan, Brooklyn, Bronx, Queens and Staten Island NY

This bulletin is continuing guidance on the FinCEN Geographic Targeting Orders (GTO) which were issued to all underwriters. A New GTO has been issued, extending the effective date of the reporting requirement to May 15, 2019.   As a reminder, the GTO has defined a covered business to include Stewart Title Insurance Company, Stewart Title Guaranty Company (the Stewart family), its employees and its authorized Title Agent. The amended GTO has defined a covered transaction as any transaction that would close from November 16, 2018 to May 15, 2019 involving:

1.    Residential real property located in the

a.    Boroughs of Manhattan, Bronx, Brooklyn, Queens and Staten Island in the City of New York, State of New York

b.    Counties of Bexar, Tarrant and Dallas in the State of Texas *

c.    Counties of Miami-Dade, Broward and Palm Beach in the State of, Florida

d.    Counties of San Diego, Los Angeles, San Francisco, San Mateo and Santa Clara in the State of California

e.    City and County of Honolulu Hawaii.

f.     Clark County, Nevada *

g.    King County, Washington *

h.    Counties of Suffolk and Middlesex in Massachusetts *

i.      Cook County, Illinois *

2.    The proposed insured/buyer is a Legal Entity, defined as a corporation, limited liability company, partnership or other similar business entity whether formed under the laws of a State or any other state, in the United States or a foreign jurisdiction, and;

 

3.    Consideration of more than $300,000.00 or more in all Counties, and;

 

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, and

5.    Any portion of the purchase price is paid using currency, cashier’s check, certified check, traveler’s check, money order in any form, personal check, business check, funds transfer or virtual currency. (An attorney trust or escrow check is considered a business check for reporting purposes). There is no de minimus amount below which the reporting is not triggered

In the event a transaction meets the above criteria, (remember, the transaction must meet the current 4 prong test (covered location, improved residential property, over $300,000.00, and without institutional financing-in cash) then the covered transaction shall be reported to FinCEN by filing the Currency Transaction Report (“CTR”) within thirty (30) days of the closing and must include the following:

1.    The CTR can be found at https://bsaefiling.fincen.treas.gov/docs/GTO/RealEstate_GTO_Template.pdf

(The CTR works best using Internet Explorer)

KEY Changes:

1.     Purchases through a TRUST have been removed.  The definition of a legal entity no longer includes a TRUST.

2.    Confidentially provisions have been removed

3.    Part IV of the CTR shall contain formation about the Covered Transaction as follows:

a.    The Covered Business shall ensure the term “REGTO1118” remains in Field 45 of Part IV.

 

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.

All offices and agents must (1) retain all records relating to compliance with the Order for a period of five years from the last day that this order is effective (including any renewals of the Order), (2) store such records in a manner accessible within a reasonable period of time, and (3) make sure such records are available to FinCEN, or any other appropriate law enforcement or regulatory agency, upon request. Stewart, as part of our normal auditing process, will audit your compliance with this GTO, and subsequent GTO’s as modified or amended.  We encourage the use of the ALTA forms to certify that the transaction is reportable and the ALTA forms to collect the information to assist in the reporting and compliance with this GTO. ALTA forms are being updated and will be sent once available. 

Failure to report can subject the company or any of its employees to civil and criminal penalties.

Stewart suggests the following:

We encourage you to review prior FinCEN GTO bulletins and orders since many of the requirements are the same.  Advise your clearance and legal staff on the confidential nature of the GTO.  Provide them with the criteria on the reportable transactions as well as a script for discussing the requirements with clients/customers based upon the below exception language.  Utilize the ALTA forms to collect the information.  Attend an upcoming Stewart Web Ex. Include the following exception/requirement in every title report or commitment for a transaction involving property located in the areas listed above.

EXCEPTION/REQUIREMENT:

This Company is required by Federal Law to collect certain additional information from you and the parties representing you regarding the purchase of real property.  US Code Title 31-Sec 5326 authorizes the U.S Department of Treasury to collect information about certain transaction as specified in various geographic targeting orders for the purpose of preventing evasion of the Bank Secrecy Act.  As a result of a Geographic Targeting Order ("GTO") issued by the United States Department of Treasury, Financial Crimes Enforcement Network ("FinCen"), on November 15, 2018 this transaction may be responsive to the requirements of the GTO.  You may be required, as a condition of the issuance of the policy to provide additional information that will be reported to FinCEN.  Please contact this company and provide the details of this transaction in order to comply with the GTO.

 

If the transaction meets the reporting requirement, you will be asked to provide information on the identity of the parties to the transaction, which will be reported to FinCEN. This company is prohibited from issuing its policy if the transaction is reportable and the information is not provided for reporting.  Additional exceptions and or requirements may be raised.

 

In the event you have any questions, please call the Stewart Title Insurance Company – New York legal Department at (212) 922-0050.

Forms: CTR; ALTA Form WORD; ALTA Form PDF

Attachments: FinCEN GTO

 

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.

References

Bulletins Replaced:
None
Related Bulletins:
NY000578 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) Geographic Targeting Order, New York County, NY and Miami-Dade County Florida
 
NY000580 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) Geographic Targeting Order, New York County, NY
 
NY000581 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) Geographic Targeting Order, New York County, NY
 
NY000582 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) Geographic Targeting Order, New York County, NY
 
NY000585 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) Geographic Targeting Order, Manhattan, Brooklyn, Bronx, Queens and Staten Island NY
 
NY000590 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) Geographic Targeting Order, Manhattan, Brooklyn, Bronx, Queens and Staten Island NY
 
NY000602 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) EXTENDED Geographic Targeting Order, Manhattan, Brooklyn, Bronx, Queens and Staten Island NY
 
NY000606 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN)
 
NY000607 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN)
 
NY000613 US Department of Treasury: Financial Crimes Enforcement Network (FinCEN) Geographic Targeting Order, Manhattan, Brooklyn, Bronx, Queens and Staten Island NY
Underwriting Manual:
None
Exceptions Manual:
None
Forms:
None