FinCEN

I previously wrote about the the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) “Geographic Targeting Orders” (GTOs) here (August 2016), here (February 2017), and here (August 2017 update).

The GTOs were updated again beginning March 21, 2018, and extended to September 16, 2018, unless superseded, and except as is provided in Section III.C of the Orders (regarding retention of records).

The GTOs require that title insurance underwriters and their agents report information about certain residential real estate transactions with a sale price of $1,000,000 or more in Miami-Dade, Broward and Palm Beach Counties.**  The purpose of the GTOs is to help FinCEN and other federal agencies identify potential money laundering in certain real estate transactions. For more information about reporting requirements, see my update post from August 2017.

A  blank FinCEN Form 8300 form can be downloaded here in fillable .pdf format.  A sample Form 8300 with the necessary information completed can be found here.

FAQs for the GTOs can be found here.   Any other questions about the Orders should be directed to the FinCEN Resource Center at 800-767-2825.  Each of the major title insurance underwriters will also be able to provide information about the GTOs and the underwriter’s requirements for compliance with the GTOs.

**  Note:  This blog is concerned primarily with South Florida real estate issues, but the renewed GTOs include the following major U.S. geographic areas:  (1) all boroughs of New York City; (2) Miami-Dade County and the two counties immediately north (Broward and Palm Beach); (3) Los Angeles County; (4) three counties comprising part of the San Francisco area (San Francisco, San Mateo, and Santa Clara counties); (5) San Diego County; and (6) the county that includes San Antonio, Texas (Bexar County).  The monetary thresholds for each geographic area can be found in this table on FinCEN’s website.

I previously wrote about the the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) “Geographic Targeting Orders” (GTOs) here (August 2016) and here (February 2017) .  The GTOs were updated again and expanded to cover even more transactions.

The GTOs require that title insurance underwriters and their agents report information about certain residential real estate transactions with a sale price of $1,000,000 or more in Miami-Dade, Broward and Palm Beach Counties.**  The purpose of the GTOs is to help FinCEN and other federal agencies identify potential money laundering in certain real estate transactions.

The GTOs issued earlier this year expire today (August 22, 2017).  FinCEN renewed and expanded the GTOs this week.  The new GTO reporting requirements take effect on September 22, 2017, and end on March 30, 2018   (unless extended again by FinCEN).  For closings scheduled between August 23, 2017, and September 21, 2017, the GTO will not apply—although FinCEN will accept voluntary filings.

As a result of the extension of the GTOs, title insurance underwriters and their agents must continue to report information about certain residential real estate transactions in Miami-Dade, Broward and Palm Beach Counties.  [See the note below regarding other geographic areas affected by the renewed GTOs.]  Click here for a sample of the renewed GTOs.

For South Florida transactions**, a “Covered Transaction” continues to be any real estate transaction: (i)  involving residential real estate in Miami-Dade, Broward or Palm Beach counties (see closing dates above); (ii) with a purchase price of $1 million or more; (iii) where the purchaser is a corporation, limited liability company (LLC), partnership, or other similar legal entity [but excluding natural persons or trusts]; (iv) and the purchaser purchases the real estate without a bank loan or other similar form of external financing; and (v) the purchaser pays any part of the purchase price, including a deposit, using currency or a cashier’s check, certified check, traveler’s check, personal check, business check, or a money order in any form, or a funds transfer.  [That last part in bold is new!  Previously, if all of the funds were paid via wire transfer or electronic funds transfer, the transaction was exempted.  Not any more, now you have to report it!]

If a transaction meets all the elements above, the Covered Business (i.e., the title insurance underwriter and its agent) must complete and file FinCEN Form 8300 within thirty days of the closing.  The information required on FinCEN Form 8300 includes identifying information for: (1) each natural person owning at least 25 percent or more of the business entity purchasing the property, or (2) all natural persons (members) if the purchaser is an LLC.

A  blank FinCEN Form 8300 form can be downloaded here in fillable .pdf format.  A sample Form 8300 with the necessary information completed can be found here.

FAQs for the GTOs can be found here.   Any other questions about the Orders should be directed to the FinCEN Resource Center at 800-767-2825.  Each of the major title insurance underwriters will also be able to provide information about the GTOs and the underwriter’s requirements for compliance with the GTOs.

**  Note:  This blog is concerned primarily with South Florida real estate issues, but the renewed GTOs include the following major U.S. geographic areas:  (1) all boroughs of New York City; (2) Miami-Dade County and the two counties immediately north (Broward and Palm Beach); (3) Los Angeles County; (4) three counties comprising part of the San Francisco area (San Francisco, San Mateo, and Santa Clara counties); (5) San Diego County; and (6) the county that includes San Antonio, Texas (Bexar County).  The monetary thresholds for each geographic area can be found in this table on FinCEN’s website.

 

NOTE:  The information in this post is outdated due to passage of time.  Please review our updated post from August 2017.

 

Last year, the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) issued “Geographic Targeting Orders” (GTOs) which require that various title insurance underwriters and their agents report information about certain residential real estate transactions with a sale price of $1,000,000 or more in Miami-Dade, Broward and Palm Beach Counties.**  The purpose of the GTOs is to help FinCEN and other federal agencies identify potential money laundering in certain real estate transactions.  We previously posted about the 2016 GTOs on this blog.

The previous GTOs were scheduled to expire on February 23, 2017.  Earlier this week, FinCEN issued renewed GTOs which take effect on February 24^th and extend the previous GTOs to August 22, 2017. The 180 day extension is the maximum allowed by law (but the new expiration date can be extended again by FinCEN).  As a result of the extension of the GTOs, title insurance underwriters and their agents must continue to report information about certain residential real estate transactions in Miami-Dade, Broward and Palm Beach Counties.  [See the note below regarding other geographic areas affected by the renewed GTOs.]  Click here for a sample of the renewed GTOs.

For South Florida transactions**, a “Covered Transaction” continues to be any real estate transaction: (i)  involving residential real estate in Miami-Dade, Broward or Palm Beach counties (see closing dates above); (ii) with a purchase price of $1 million or more; (iii) where the purchaser is a corporation, limited liability company (LLC), partnership, or other similar legal entity [but excluding natural persons or trusts]; (iv) and the purchaser purchases the real estate without a bank loan or other similar form of external financing; and (v) the purchaser pays any part of the purchase price, including a deposit, of the purchase price using currency, or a cashier’s check, certified check, traveler’s check, personal check, business check or money order.

If a transaction meets all the elements above, the Covered Business (i.e., the title insurance underwriter and its agent) must complete and file FinCEN Form 8300 within thirty days of the closing.  The information required on FinCEN Form 8300 includes identifying information for: (1) each natural person owning at least 25 percent or more of the business entity purchasing the property, or (2) all natural persons (members) if the purchaser is an LLC.

A  blank FinCEN Form 8300 form can be downloaded here in fillable .pdf format.  A sample Form 8300 with the necessary information completed can be found here.

FAQs for the GTOs can be found here.  Any other questions about the Orders should be directed to the FinCEN Resource Center at 800-767-2825.  Each of the major title insurance underwriters will also be able to provide information about the GTOs and the underwriter’s requirements for compliance with the GTOs.

**  Note:  This blog is concerned primarily with South Florida real estate issues, but the renewed GTOs include the following major U.S. geographic areas:  (1) all boroughs of New York City; (2) Miami-Dade County and the two counties immediately north (Broward and Palm Beach); (3) Los Angeles County; (4) three counties comprising part of the San Francisco area (San Francisco, San Mateo, and Santa Clara counties); (5) San Diego County; and (6) the county that includes San Antonio, Texas (Bexar County).  The monetary thresholds for each geographic area can be found in this table on FinCEN’s website.