As a reminder, the stay concerning certain marketing prohibitions outlined in New York State Department of Financial Services (NYSDFS) Regulation 208, expires tomorrow, February 1, 2018!
For companies involved with providing title insurance for residential or commercial real estate transactions in New York State, or for those who in some way interact with them, the following list describes those expenditures that as of tomorrow will no longer be allowed, and those that will still be allowed.
From Fidelity National Title Group…
Date: Wednesday, January 31, 2018
To: All New York Agents
From: FNTG NY Agency
Re: Enforcement of Regulation 208 Begins February 1, 2018
Ref. #: M2018.0131A
On December 19, 2017, the Department of Financial Services announced that it would stay enforcement of a portion of Regulation 208 until February 1, 2018.
There are a lot of rumors going around about Regulation 208. THE FACT IS THAT TOMORROW, THURSDAY, FEBRUARY 1, THE DEPARTMENT OF FINANCIAL SERVICES WILL BEGIN ENFORCEMENT OF ALL PORTIONS OF REGULATION 208.
There is proposed legislation that would force DFS to modify Regulation 208, but there is a long way to go before that will become law. The New York State Land Title Association is also working on solutions, but all of this takes time. All of these things are proposals and do not delay the enforcement of Regulation 208 beyond January 31.
You must be in compliance with the requirements of Regulation 208 on February 1, 2018.
As a reminder the following expenses are PROHIBITED:
- Meals and beverages;
- Entertainment, including tickets to sporting events, concerts, shows or artistic performances;
- Gifts, including cash, gift cards, gift certificates, or other items with a specific monetary face value;
- Outings: including vacations, holidays, golf, ski, fishing and other sport outings, gambling trips, shopping trips, or trips to recreational areas, including country clubs;
- Parties, including cocktail parties and holiday parties, open houses;
- Providing assistance with business expenses of another person, including but not limited to rent, employee salaries, advertising, furniture, office supplies, telephones, telecommunications, computers and other electronic devices and business equipment, or automobiles, or leasing, renting operating, or maintaining any of such items, for use by other than a title insurance corporation or title insurance agent;
- Us of premise, unless a fair rental fee is charged that is equal to the market value in the premises’ geographical area;
- Paying the fees or charges of any professional representing an insured as part of a real estate transaction, such as an attorney, engineer, appraiser, or surveyor, or paying rent or all or any part of the salary or other compensation of any employee or officer of any current or prospective customer;
- Providing or offering to provide non-title services, without a charge that is commensurate with the actual cost thereof.
The following expenses are PERMITTED:
- Advertising or marketing in any publication, or media, at market rates;
- Advertising and promotional items of a de minimus value that include a permanently affixed logo of a title insurance agent or title insurance corporation;
- Promotional or marketing events including complimentary food and beverages that are open to and attended by the general public;
- Continuing legal education events including complimentary food and beverages that are open to any member of the legal profession;
- Complementary attendance offered by a title insurance corporation, title insurance agent as a host of a marketing or promotional event, including food and beverages available to all attendees so long as (a) title insurance business is discussed for a substantial portion of the event including a presentation of title insurance products and services, (b) such events are not offered on a regular basis or as a regular occurrence and (c) at least twenty-five diverse individuals from different organizations not affiliated with the host attend or were, in good faith, invited to attend in person;
- Charitable contributions made by negotiable instrument made payable only to the charitable organization in the name of the title insurance corporation or title insurance agent;
- Political contributions.
Please refer to Section 228.2 of Regulation 208 for further guidance on expenses.