Page 1 Title Escrow Theft and Title Insurance Fraud Whitepaper (10/2/12 draft) Page 1 I. Introduction A. Purpose and intended usersThis white paper is intended as a tool for regulators to research methods for combating andpreventing escrow theft, title insurance theft and other forms of fraud associated with titleinsurance and closing services. transactions. When reading this paper, iIt is important torecognize regional differences in the way title insurance and closing services are provided andregulated. There are few one-size-fits-all solutions. Nor, is there a single solution to theproblem for any particular jurisdiction. Therefore, a variety of methods are identified. Wherepractical, this paper will attempt to discuss the merits as well as the shortcomings of eachidentified method. The availability of proprietary solutions such as software and systemsapproaches will also be discussed without identification of specific providers. The ultimate goalof this paper is to identify ways to improve title insurance and closing service consumerprotection.The white paper may is also be usedavailable for use by the title insurance and closing servicesindustry when evaluating their own enterprise risk management and auditing guidelines forcombating escrow and title insurance premium theft. These are problems that cause consumer losses and a great deal of expense for insurersunderwriters, in terms of claims, auditing, legal fees and mopping up resulting failed title agencies. In addition to direct monetary costs, thepotential for reputational damage or even resulting insolvency is a major concern. Because ofthe unpredictability of the frequency and magnitude of these events, serious negative results totitle insurers’ underwriters’ financial condition can result. The unnecessary and hopefullypreventable expenses associated with mishandling of title insurance and closing funds areultimately borne by customers in the form of higher title insurance premiums and closing costs.
Posted on: Wed, 28 Aug 2013 01:18:53 +0000
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