The Illinois Division of Financial Institutions reached an agreement with Professional National Title Network (PNTN) regarding the allegations in a cease-and-desist order issued Nov. 2, 2018, demanding PNTN discontinue its Examining Attorney Program, which the division found allowed attorneys not individually registered as title insurance agents to provide title services in violation of Section 21(a)(16) of the Act, id. § 155/21(a)(16), and the Act’s implementing regulations, 50 Ill. Admin. Code § 8100.
PNTN argued that it had discontinued its Examining Attorney Program and submitted a request for hearing.
The agreement was entered into Feb. 18, 2020, and will remain in effect for three years after the effective date of Feb. 18, the division stated. It requires PNTN to test 25 randomly selected transactions for each title insurance underwriter it works with every quarter “to analyze whether PNTN paid a percentage of a title insurance premium to a person who had not registered as a title insurance agent with the division for the applicable title insurance underwriter. For purposes of this paragraph, PNTN transactions shall only include transactions affecting real estate in the city of Chicago or Cook County, DuPage County, Kane County, Lake County, McHenry County and Will County, where PNTN acted as settlement service or the non-policy issuing, supervising title insurance agent. PNTN shall provide to the division for approval the methodology by which it will randomly select the PNTN transactions before it conducts its first quarterly review, but in no event later than 30 days after the effective date.”
In any given quarter, if PNTN and the division confirm there are no instances where PNTN paid a percentage of a title insurance premium to a person not registered as a title agent by the title underwriter who paid PNTN the premium, PNTN will not be required to review additional records for that quarter. However, if they do find one or more instances of this, PNTN will have to test an additional 25 randomly selected transactions for each title insurance underwriter PNTN works with.
“No later than 15 days following the end of each quarter, PNTN shall provide to the division a report containing the results of its testing under this section. Upon request by the division, PNTN shall within five days provide the division with the complete file for any or all of the tested PNTN transactions. In any instance where PNTN paid a percentage of a title insurance premium to a person who has not been registered as a title agent by the title underwriter who paid PNTN the premium, PNTN shall, within 10 days of its findings, provide (a) the person’s name and current contact information to the division; and (b) provide notice to the appropriate underwriter that such person is not registered as a title agent; and (c) cease doing business with the person until such person is registered by the title underwriter,” the settlement agreement states.
It also will have to provide a yearly report to the division that lists all unregistered persons who PNTN identified in the past year and provide the date, if any, when PNTN submitted documentation to register the person with the division.
“PNTN shall at its own expense develop and offer a training course to registered title insurance agents in Illinois on relevant industry topics, including but not limited to: compliance with the Act and the Code; ethics in the title insurance industry; and understanding title insurance. Training must be offered annually for the term of this agreement, with the first training completed within 180 days of the effective date. Training must be attended by escrow agents who have or intend to have a financial relationship with PNTN and at least attended by those PNTN representatives responsible for compliance,” the settlement agreement states.
Within 30 days of the effective date, PNTN also will have to pay $400,000 to the department as administrative fees.