Top 10 Things that Prevent an Agent from Passing an Assessment
Failure to segregate duties over the preparation of escrow trust account reconciliations
Agents must ensure that reconciliations are prepared by someone not associated with receipts and disbursement functions.
Failure to prepare monthly and daily escrow trust account reconciliations in a timely manner
Agents must complete monthly reconciliations within 10 business days of the closing date of the bank statement.
Agents must retain evidence that daily reconciliations are prepared each day for all active escrow trust accounts.
Failure to adjust reconciling items on the monthly and daily escrow trust account reconciliations
Agents should ensure that all adjustments needed to bring accounts into balances are addressed immediately upon discovery.
Failure to utilize Positive Pay or Reverse Positive Pay for ALL active escrow bank accounts.
Agents must obtain Positive Pay or Reverse Positive Pay, if available in the local market place, for all active escrow trust accounts.
Failure to utilize ACH debit blocks or international wire blocks for escrow trust accounts
Agents must have policies and procedures in place to prohibit or control the use of ACH debits and international wires.
Failure to perform an adequate information security risk assessment
Agents must perform a security risk assessment, including risk ranking of information systems.
Failure to test the information security program in accordance with the risk assessment.
Agents must ensure that key controls, systems and procedures of the information security program are tested by qualified independent staff.
Failure to ensure third-party signing professionals possess the appropriate qualifications.
Agents must ensure third-party signing professionals, including notaries public, possess the proper insurance, licensure and industry designation.
Agents must obtain an acknowledgement of compliance with the agent’s instructions and information security program.
Failure to remit underwriter premiums in a timely manner
Agents must retain evidence that premiums were remitted to the underwriter in accordance with statutory, regulatory and contractual obligations.
Failure to obtain insurance as required
Agents must obtain professional liability insurance, errors and omissions insurance, fidelity and surety bonds in accordance with the underwriter agreements.
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