- May 13, 2021
- All New Mexico Issuing Offices
- UNDERWRITING - Escrow Accounting-OSI Order and Guidance relating to New Rules regarding Escrow Services
On April 12, 2021, the New Mexico Office of Superintendent of Insurance (“OSI”) issued an order related to the new rules adopted January 1, 2021, regarding escrow services, including the requirement to retain an independent certified public accountant to perform an Agreed Upon Procedures (“AUP”) engagement covering the required compliance procedures and the new guidance issued by OSI. The order also requires each title agent to submit the AUP report to OSI by July 30, 2021.
On April 29, 2021 OSI issued guidance related to the regulations of NMAC 13.14.4 §§8-10 and NMAC 13.14.4 §11. Copies of the April 12, 2021, order, the two guidance notices and the current rules in 13.14.4 are attached.
The guidance contains numerous specific requirements that must be followed. For example, the guidance on NMAC 13.14.4 §11 includes the minimum information to be contained in the AUP report, sampling requirements and minimum recommended procedures. It suggests that agents have the following available for the AUP engagement with the CPA: system reports to support all escrow-related file activity, all bank statements, bank reconciliations, and supporting documentation for the full calendar year and any internal policies and procedures supporting compliance processes and controls related to escrow activity.
We suggest you carefully review the guidance and your existing procedures for compliance with all OSI requirements. If you have any questions relating to the order, guidance, or rules we suggest you consult with your counsel.
If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.
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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.