Acting on concerns of illegal transfers of consumer funds from their trust accounts, the Washington Department of Financial Institutions (DFI) issued a temporary cease and desist order April 26, 2002 against two escrow companies and their owner.
The two companies, Ocean Shores Escrow, Inc. of Grays Harbor County and Cornerstone Escrow, Inc. of Thurston County were ordered to cease transacting business until otherwise instructed and all deposits into or out of bank accounts were temporarily halted. The department identified as much as $174,000 that may have been inappropriately transferred from the trust account.
Each escrow company operating in Washington uses a single "pooled" account maintained for the benefit of all of its customers involved in escrow transactions such as purchases, refinances, or collections.
"When shortfalls or irregularities are identified within the account, it affects the balances held for all consumers," said Mark Thomson, acting director of DFI. "Any further funds paid out of the account create more shortfalls and deposits into the account are automatically compromised." In cases such as this, he explained, the department has no choice but to freeze all activity within the accounts pending further investigation.
Consumers with questions concerning accounts with either Ocean Shores Escrow, Inc. or Cornerstone Escrow, Inc. should contact the Department of Financial Institutions at 1-877-RING DFI (1-877-746-4334).