NYS Assembly weighs oversight of the title insurance industry

Group says members are bracing for a 30% drop in revenue

New York /
Feb.February 15, 2018 12:55 PM

From left: Bob Treuber, Kevin Cahill and Maria Vullo

Members of the New York State Assembly are considering ways to regulate the title industry — but without the kind of strict rules imposed on insurers this month by the state.

Assemblyman Kevin Cahill, chair of the Assembly’s standing committee on insurance, said the committee is weighing options for restricting title companies’ marketing expenses. But the approach would be more like “putting up guardrails,” rather than the blanket action taken by the Department of Financial Services. New regulations from DFS, which went into effect Feb. 1, ban marketing expenses like buying clients a cup of coffee, paying for meals and entertainment, or sponsoring continuing legal education classes.

Cahill said the Assembly is weighing legislation that “would specify those areas of compensation that could or could not be made.”

After the state Senate voted on legislation to unwind the DFS regulations, the bill was sent to the Assembly’s insurance committee.

“We want to repair the damage that’s been done by a regulation that overreaches the statutory authority granted to the agency,” Cahill said. “My goal would be to put in some reforms that would authorize the superintendent to place some restrictions on that which could be charged back to the buyer as part of a fee.” That would include marketing expenses like going to a gentlemen’s club, for example.

Cahill said the bill’s amendment would also deal with gratuities paid to closers, the independent contractors whose compensation relied on tips they received for attending closings, transferring bank checks, transporting documents and handling a myriad of other tasks. (DFS’ new regulations ban such tips.)

Cahill said his office has received a number of letters and calls from small businesses and title closers who are having trouble staying in business. “Real estate is the single greatest economic engine in New York state, and real estate comes to a standstill if people cannot be assured their titles are secure,” he said. “So it’s not something anyone should take lightly.”

DFS Superintendent Maria Vullo — who has aggressively fought to curb title companies’ marketing expenses — has said the Senate bill, if enacted into law, “would give a license to bribery.”

In a survey of its members by the New York State Land Title Association, members said they expect revenue to drop between 10 and 30 percent as a result of the DFS regulations. Ten to 15 percent predicted they will be force to make layoffs.


Related Articles

arrow_forward_ios
Douglas Elliman CEO Dottie Herman on FOX
Elliman CEO: ‘People are afraid to walk in NYC’
Elliman CEO: ‘People are afraid to walk in NYC’
Village Preservation executive director Andrew Berman (iStock, Village Preservation)
Manhattan CB2 votes against Soho/Noho rezoning
Manhattan CB2 votes against Soho/Noho rezoning
Soho’s zoning madness, such as artists-only lofts and a ban on ground-floor retail, may finally change with a proposed rezoning.
The shopping district that banned retail: Soho’s incoherent zoning
The shopping district that banned retail: Soho’s incoherent zoning
Gov. Andrew Cuomo (Getty, iStock)
Cuomo vows to speed rent relief after pressure from Schumer
Cuomo vows to speed rent relief after pressure from Schumer
Eric Adams (Getty, iStock)
City program could supplement state rent relief — if next mayor signs off
City program could supplement state rent relief — if next mayor signs off
The tenants who won the affordable housing lottery at 15 Hudson Yards say the units are in an “entirely separate part of the building and with a different address.” (Hudson Yards, District Court of New York)
Lawsuit claims 15 Hudson Yards discriminates with “poor doors”
Lawsuit claims 15 Hudson Yards discriminates with “poor doors”
Council members call out City Planning on Soho rezoning
Council members call out City Planning on Soho rezoning
Council members call out City Planning on Soho rezoning
Jared McClain of NCLA and Gov. Phil Murphy (Photos via iStock, NCLA, Getty)
NJ tenants can pay rent with security deposits: court
NJ tenants can pay rent with security deposits: court
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...