Consumer Information – Escrow
Escrow agents are either “licensed” or “controlled” escrow companies
In the terminology of the escrow industry, all escrow agents performing escrow services in California are either “licensed” or “controlled” escrow companies.
A “licensed” escrow company, which is also known as an “independent” escrow company, is licensed by the Department of Financial Protection and Innovation. This license can only be obtained after the escrow company has met and satisfied all of the licensing requirements set forth by the Escrow Law, which are enforced by the Department of Financial Protection and Innovation.
- For independent escrow companies, contact the Department of Financial Protection and Innovation at (866) ASK-CORP or search our licensee listing.
A “controlled” escrow, which may be known as a “non-independent” escrow, is not licensed by the Department of Financial Protection and Innovation. A controlled escrow could be owned and operated by, but is not limited to, an attorney, a real estate broker, a title insurance company, among others. The licensing and regulation of controlled escrows depends on the jurisdiction of the licensing and regulatory authority; therefore, the licensing requirements, laws, and regulations that they are subject to vary widely. The following agencies can assist you when inquiring about the licensing status of an escrow:
- For title insurance/underwritten title companies performing controlled escrows, contact the California Department of Insurance at (800) 927-HELP or go to www.insurance.ca.gov.
- For real estate broker controlled escrows, contact California Department of Real Estate (DRE) at (877) 373-4542 or go to www.dre.ca.gov.
- For attorney controlled escrows, contact the State Bar of California at (800) 843-9053 or go to www.calbar.ca.gov.
- For controlled escrows handled by federally-chartered banks or federally-chartered savings and loan associations, contact the Office of the Comptroller of the Currency at (800) 613-6743 or go to www.occ.gov.
- For controlled escrows handled by state-chartered savings and loan associations or state-chartered savings banks, contact the Division of Financial Institutions at (800) 622-0620 or go to www.dfpi.ca.gov.
Unlicensed escrow activity
If your escrow company is not licensed by the Department of Financial Protection and Innovation and is not regulated by one of the governmental agencies listed above, contact the Department of Financial Protection and Innovation at 1(866) ASK CORP or 1(866) 275-2677 or submit a complaint. The company may be engaging in unlicensed escrow activity.
What action can the department take against escrow agents that fail to comply with the escrow law and regulations?
The activities of an escrow agent are highly regulated for the protection of members of the public who entrust their funds to these companies. The owners of a company are responsible for the actions of the managers and employees. The escrow agent’s operations are subject to the provisions of the California Financial Code and the California Code of Regulations. Failure to comply with these laws and rules can result in administrative action being taken that can range from a Desist and Refrain order to the Department taking possession of the company. The Department may assess penalties for late filing of reports, or bar an individual from any position of employment or other association with a licensed escrow agent, subject to appropriate administrative procedures. The Department can also pursue criminal and civil sanctions where it is appropriate.