escrow account control procedures

Procedures

  • Separate bank accounts are established for all escrow funds. Escrow funds are not commingled with operating funds.
    • Current list of escrow accounts is kept on hand and is available upon request for all underwriters.
  • Escrow funds are deposited in federally insured Financial Institutions.
  • Escrow accounts are identified or titled as “escrow” or “trust” accounts.
  • Positive pay and ACH debit blocks are utilized when available.
  • Transactions are conducted by authorized employees only. Current list of authorized employees is kept on hand for each escrow account.
    • Authorization levels for each employee are updated on an annual basis.
    • Former employees are immediately deleted as listed signatories on all escrow accounts.
  • Authorized signatories are not involved with the reconciliation process.
  • Outstanding file balances are documented.
  • All escrow accounts are reconciled on a “daily” basis.
  • Trial Balances are prepared for all escrow accounts.
    • Trial balances indicate if any files are overdrawn.
    • Trial balances are reviewed on a monthly basis by management.
  • At the end of each month, Three-Way reconciliations are performed reconciling the bank statement, check book, and trial balances.
    • The end-of-month Three-Way reconciliation is reviewed and signed off by management.
    • Three-Way reconciliations are scanned into our computer system and kept for a minimum of seven years.
    • Copies of Three-Way reconciliations are available upon request for all of our underwriters.
  • Credit and background checks are performed on all new employees before they are hired.
  • Credit reports and background checks may be obtained on all employees, at a minimum, every three years.
  • Training manual is provided and training is conducted upon hire for all new employees.
    • Ongoing training for existing employees is conducted on an annual basis.