Earlier this year, the Financial Crimes Enforcement Network (FinCEN), a bureau of the U.S. Treasury Department issued its Geographic Targeting Order (GTO or “Order”) requiring certain title insurers and their agents to report details of certain residential real estate transactions in New York County, NY, which Order is set to expire August 27, 2106. Now, FinCEN has issued a new GTO, effective August 28, 2106 which effectively continues the requirements of the earlier Order and expands the geographic reach thereof to include the remaining four counties that comprise the City of New York, that is, Queens, Kings, Bronx and Richmond Counties. However, as it pertains to the newly covered counties, the threshold purchase price is $1,500,000. The $3,000,000 threshold remains for NY County properties. This Order will be in effect until February 23, 2017. And, whereas the earlier Order affected transactions that were closed by only certain specified New York title insurance companies, the new Order is effective on all New York licensed title insurers and their agents.
To restate the criteria for what is a “Covered Transaction” under the GTO, where there is a purchase of residential real estate (1-4 family, condominium unit or co-operative apartment) and the purchaser is a “Legal Entity”, that is a corporation, limited liability company, partnership or other similar business entity, and the purchase is made without a bank loan or other similar form of external financing, and is made, at least in part, using currency or a cashier’s check, certified check, traveler’s check, personal or business check, or a money order in any form and for a total purchase price of $3,000,000 or more in the borough of Manhattan or a total purchase price of $1,500,000 or more in the boroughs of Brooklyn, Queens, Bronx or Staten Island, then the reporting requirements of the Order will apply.
An informational note will be added to all of our title reports regarding this matter, but please be advised, that failure to account for the requirements of the Order, where it applies, may result in delayed closings. For more detailed information regarding the GTO, its application and requirements, please call our office.