A Washington escrow officer has voluntarily canceled her limited practice officer (LPO) license in lieu of further disciplinary hearings after being accused of wiring almost $2 million in client escrow funds to a scammer. The Washington State Department of Financial Institutions, Division of Consumer Services (DFI) had in late 2021 issued a temporary order to cease and desist regarding the matter. While she did not admit to the alleged misconduct contained in a statement of alleged misconduct attached to her voluntary cancelation, she agreed the board could prove by a clear preponderance of the evidence that she committed violations sufficient to result in the revocation of her LPO certification.
A. Lynn Rivera was admitted as an LPO in Washington State on June 8, 1987. She owns Escrow Services of Washington LLC and was licensed by the DFI as an escrow officer on Jan. 29, 2021. Escrow Services also was licensed as an escrow agent and Rivera was its designated escrow officer.
According to the statement of alleged misconduct, Escrow Services maintained an escrow account at Key bank and in October 2021, the bank issued two notices of insufficient funds for the account. It alleges that in September and October 2021, Rivera “knowingly made multiple unauthorized disbursements of client and/or third person escrow funds via wire transfers to unknown parties,” totaling about $1.97 million.
After closing disbursements were not being made in October 2021, Rivera allegedly initially told clients that Escrow Services’ bank account had been hacked. On Nov. 10, 2021, she allegedly sent two clients an email admitting to lying about the account hack and informing them that she had willfully transferred client funds to unknown parties under duress. Rivera allegedly sent a letter to clients on Nov. 12, 2021, telling them she was a victim of extortion, “which led to her failure to disburse escrow funds to the appropriate parties.” She allegedly apologized and told clients she would reimburse the funds taken from the aggrieved party.
DFI issued a temporary order to cease and desist on Nov. 18, 2021, ordering Rivera and Escrow Services to immediately stop accepting new escrow services customers and not accept or disburse any funds from the escrow accounts or general operating account. The order remains in effect. The voluntary cancellation in lieu of revocation went into effect March 2, 2022.