The Liaison Committee met Thursday April 13 at the DOI. Some of the issues discussed included:
1. Director Cameron attended the meeting and advised the DOI had a successful legislative session with four major pieces of legislation approved centered around accreditation requirements. In addition, the DOI had several Rule amendments approved including our changes to Rule 56 (a copy of the final Rule 56 changes is attached and is effective March 29, 2017). The Rule 56 changes did not include the entirety of what the ILTA originally contemplated but the Director expressed his willingness to address some of what we wanted that needed more work and clarification.
2. Director Cameron indicated that he had been contacted by the realtors about addressing cancelation fees. The Director expressed his positon that cancelation fees needed to be proactively addressed in a cooperative manner with the realtors this year for the 2018 legislative session or risk the realtors making changes without our input. The Director expressed that the realtors are a political force and it would be in our interest to work closely with them to help them understand the issue from our perspective and work on ways to legislatively address the issue. The Director also advised that his opinion was the legislature was in a “less government the better” mode and that addressing the cancelation fee issue with this concept in mind might be the best path. The Director indicated that because the existing language requires cancelation fees be charged, DOI audits cannot ignore that standard. Audits will point out where agents might be deficient in complying with this standard and impose a penalty that would be deferred until the issue can be resolved. The Director suggested that we work internally through the issue quickly and then bring in the DOI and realtors and move the matter through the negotiated rule making process with hearings, comments and openness. The task to address quickly this year is real given the political power of the realtors and the Director acknowledged the biggest hurdle would be getting the realtors to understand the totality of the issue. In other words we need to educate the realtors that the cancelation fee goes beyond the charging and collection of a cancelation fee when an order is legitimately opened and legitimately canceled. The real crux of the issue seems to be in addressing the cancelation fee based on its history of past abuse as an illegal inducement i.e. when commitments are ordered for listings in a less then legitimate context for an actual order.
3. If you have thoughts and comments on cancelation fees please submit them via response to these minutes or contact a board member so your opinion/position on the matter can be considered in addressing the issue. You will also have the opportunity to submit comments and testify at hearings but the board would like to hear from you in advance so your position can be considered in our position for the Association.
4. The Director also reported that at the recent NAIC meetings discussion centered in large part about the significant level of escrow fraud. The Director had asked Jim what level of escrow fraud there was in Idaho. Jim and the participants at this liaison meeting advised that fraud in terms of money lost was not significant but that the industry as a whole is under constant and growing pressures and threats of fraud and scams. Wire fraud and requests to change wire instructions is a constant battle. ALTA Best Practices and our own industry controls have implemented numerous preventative measures regarding wire fraud and other scams i.e. email encryption; positive pay, checks and balances and other software programs for security; constant training; notices to agents, realtors and lenders about what to look for and what to expect and not expect; etc. Unfortunately, it seems realtors have little to no protocols and preventative measures despite their emails being regularly hacked and the source for fraud scams. It was discussed that while the title industry spends a significant amount of time, money and resources for protection and preventative measures it seems the realtors expend little, especially when they appear to be the genesis of where fraud percolates and originates. This could be an education opportunity with the realtors and/or having a better understanding of what measures and expenditures they have implemented on their end.
5. Jim advised his Red Vision investigation was complete and the DOI deemed that the product being pushed by Red Vision is not a title insurance product but akin to a lot book and informational report. Red Vision did agree to change its web site to clarify misleading comments in this area.
6. Jim also advised that the investigation into Fidelity National Agency Solutions was ongoing and that WA, OR and UT are also investigating and all had similar as well as additional concerns to the products and services being offered.
7. Martin advised that his information was that Fremont County was standing down from its earlier reported positon of not accepting an affidavit of death coupled with a WD from a surviving spouse to transfer title and taxes after the 3 year statute of limitations has expired for probate of the deceased spouse. However, it was unclear if Minidoka had stood down. If you have insight into what Minidoka County is doing please advise.
8. Also attached is Martin’s legislative and sine die report which includes a recap of our HB 205 for flat recording fees that was signed by Gov. Otter and is effective July 1, 2017.
9. E-recording with the straggler Counties is an ongoing issue. The 6 stragglers has been whittled to 5 (Boundary, Shoshone, Nez Perce, Butte and Franklin). Getting the remaining stragglers on board is an ILTA legislative agenda item for the 2018 legislative session. A draft mandatory language bill is already prepared and we are working with the Idaho Association of Counties who seem supportive.
10. The 2018 ed seminar is scheduled for March 8-9 at The Grove Hotel. The seminar will go back to the Thursday-Friday format – full day Thursday and half day Friday. We are already on the legislature calendar and will host the legislative reception Thursday from 4:30-6:00.
11. Mark your calendar for the Pacific NW Convention hosted by Washington in Suncadia August 16-18.
12. The next meeting will be 10:00 Thursday May 11 at Alliance Title Parkcenter.