NY Title Industry News: US Dept of Treasury Announcement on FinCEN, Financial Crimes Enforcement Network
This bulletin is continuing guidance on the FinCEN Geographic Targeting Orders (GTO) which were issued to all title insurance 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 title insurance underwriters, 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:
- 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
- Counties of Bexar, Tarrant and Dallas in the State of Texas *
- Counties of Miami-Dade, Broward and Palm Beach in the State of, Florida
- Counties of San Diego, Los Angeles, San Francisco, San Mateo and Santa Clara in the State of California
- City and County of Honolulu Hawaii.
- Clark County, Nevada *
- King County, Washington *
- Counties of Suffolk and Middlesex in Massachusetts *
- Cook County, Illinois *
- 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;
- Consideration of more than $300,000.00 or more in all Counties, and;
- 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
- 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:
- The CTR can be found at https://bsaefiling.fincen.treas.gov/docs/GTO/RealEstate_GTO_Template.pdf (The CTR works best using Internet Explorer)
- Purchases through a TRUST have been removed. The definition of a legal entity no longer includes a TRUST.
- Confidentiality provisions have been removed
- Part IV of the CTR shall contain formation about the Covered Transaction as follows:
- 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, CB Title cannot issue the title insurance policy without written authority from the title insurance underwriter.