Title:50 Part:8100

SOURCE: Emergency rules adopted at 14 Ill. Reg. 305, effective January 1, 1990, for a maximum of 150 days; adopted at 14 Ill. Reg. 8600, effective May 21, 1990; amended at 26 Ill. Reg. 14265, effective October 1, 2002; amended at 34 Ill. Reg. 852, effective December 29, 2009; amended at 35 Ill. Reg. 12354, effective July 22, 2011; amended at 41 Ill. Reg. 12475, effective October 6, 2017; amended at 46 Ill. Reg. 12582, effective July 8, 2022.

SUBPART A: RULES OF GENERAL APPLICATION

Section 8100.100 Notice of Suspension or Revocation

The suspension or revocation of any certificate or registration issued under the Title Insurance Act ("Act") is effective upon completion of service pursuant to the provisions of Section 21(b) of the Act. When service is made by registered or certified mail, the Department of Financial and Professional Regulation-Division of Financial Institutions ("Division") will, if possible, notify by telephone or by facsimile transmission the affected person or party of the suspension or revocation.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.105 Notification of Noncompliance or Material Change

All holders of or applicants for any certificate of authority or registration issued pursuant to the Act shall submit written notification to this Division within a maximum of 10 business days after becoming aware of any noncompliance with the provisions of the Act and any material change in condition that places or tends to place any policyholder in jeopardy.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.110 Display of Certificates or Registrations

Each holder of a certificate of authority or registration issued pursuant to the Act shall display it in a manner conspicuous to the public or maintain it at its principal place of business for inspection upon request by the public.

Section 8100.114 Certification

a) Any applicant requesting certification as a title insurance company or as an independent escrowee, prior to certification, shall provide, as a minimum, the following information to the Division:

1) A certified copy of the Certificate of Authority from the Illinois Secretary of State authorizing it to do business in the State of Illinois, if any;

2) A Certificate issued by the State/domicile setting forth that it is in good standing and further setting forth the date upon which the Articles of Incorporation were issued, if any;

3) A certified copy of the assumed name filing, if any;

4) A brief narrative history of the company, if any;

5) A listing of the officers, directors and owners of the company, if any;

6) A listing of the company shareholders, if any, except when the shares of the company are publicly traded;

7) A certified copy of the company's charter and by-laws and any amendments thereto, if any;

8) A Certificate of Compliance from the state of domicile, if any;

9) A copy of the most recent audited financial statements, including a letter of opinion, if any;

10) The last published Annual Report of the company, if any;

11) A copy of the most recent examination, if applicable, by the state of domicile;

12) A copy of the Certificate of Deposit from the state of domicile and other states in which the company does business, if any;

13) A listing of the counties in Illinois in which the company proposes to conduct business;

14) The nature and amount of the proposed deposit, as provided for in the Act;

15) A listing of all the company's locations or proposed locations in the State of Illinois by name, address and phone number;

16) The name, address and phone number of a member of the company, or person to whom to direct questions regarding the application; and

17) The names and addresses of any proposed agents.

b) The Director of the Division of Financial Institutions (Director), with authority delegated by the Secretary of the Department of Financial and Professional Regulation (Secretary) or the Director's authorized representative, after review of information submitted as required by subsection (a), shall require the filing of that additional information with the Division as necessary to assure that the business repute and qualification of the applicant requesting certification is set forth in detail, to allow a decision to be made upon the request for certification.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.115 Prohibition on Filing Application

No person or party whose application has been denied or refused or whose certificate of authority or registration has been revoked for a violation of the Act hereunder shall be entitled to file another application within one year from the effective date of such denial, refusal or revocation, or if judicial review of such denial, refusal or revocation is sought, within one year from the date of final court order or decree affirming such action unless the Director or Director's authorized representative has issued a variance as provided by Section 8100.190 of this Part. Such application, when filed after one year, may be refused by the Director unless the person or party shows change(s) in condition or situation to establish why the denial, refusal or revocation of the certificate of authority or registration shall not be deemed a bar to the issuance of a new certificate or registration.

Section 8100.120 Computation of Time

The time within which an act under the Act shall be done shall be computed by excluding the first day and including the last, unless the last day is a Saturday, Sunday or holiday as defined or fixed in any statute now or hereafter in force in this State, and then it shall also be excluded. If the date succeeding such Saturday, Sunday or holiday is also a Saturday, Sunday or holiday, then such succeeding day shall also be excluded.

Section 8100.121 Requirements as to Proper Form

Any document filed with the Division pursuant to the Act shall be prepared in accordance with the form, if any, prescribed therefor by the Director. Any such document shall, after review by the Division, be deemed to be filed on the proper form, unless objection to the form is made in writing by the Division.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.125 Place of Filing

All applications and other papers filed with the Title Insurance Section of the Division shall be filed at Springfield, Illinois. This material may be filed by delivery to the Division, through the mails or otherwise.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.130 Additional Information

In addition to the information expressly required to be included in an application, there shall be added such further material information, if any, as may be necessary to make the required statements, in the light of the circumstances under which they are made, not misleading.

Section 8100.135 Additional Exhibits

Any holder or applicant may file such exhibits as it may desire in addition to those required by the appropriate form. The exhibits shall be so marked as to indicate clearly the subject matters to which they refer.

Section 8100.140 Information Unknown or Not Reasonably Available

Information required need be given only insofar as it is known or reasonably available to the holder or applicant. If any required information is unknown and not reasonably available to it, either because the obtaining thereof would involve unreasonable effort or expense, or because it rests peculiarly within the knowledge of another person not affiliated with it, the information may be omitted, subject to the following conditions:

a) The holder or applicant shall give such information on the subject as it possesses or can acquire without unreasonable effort or expense, together with the sources thereof.

b) The holder or applicant shall include a statement either showing that unreasonable effort or expense would be involved or indicating the absence of any affiliation with the person within whose knowledge the information rests and stating the result of a request made to the person for the information.

Section 8100.145 Requirements as to Paper, Printing and Language

a) Application shall be filed on good quality, unglazed, white paper, 8½ by 11 inches in size, insofar as practicable. However, tables, charts, maps and financial statements may be on larger paper, if folded to that size, and the prospectus may be on smaller paper, if the registrant so desires, but not less than 7½ by 9 inches in size. Applications may be submitted electronically and shall be filed in a format reasonably similar to the format described in this subsection.

b) The application and, insofar as practicable, all papers and documents filed as a part of the application, shall be printed or typewritten. However, the application or any portion may be prepared by any similar process that, in the opinion of the Division, produces copies suitable for permanent record. Irrespective of the process used, all copies of the material shall be clear, easily readable and suitable for repeated photocopying. Debits in credit categories and credits in debit categories shall be designated so as to be clearly distinguishable as such on photocopies.

c) The application shall be in the English language. If any exhibit or other paper or document filed with the application is in a foreign language, it shall be accompanied by a translation into the English language.

(Source: Amended at 41 Ill. Reg. 12475, effective October 6, 2017)

Section 8100.150 Number of Copies − Signatures

a) One copy of the completed application, manually signed by the applicant, including exhibits and all other papers and documents filed as a part of the application, shall be filed with the Division.

b) If any name is signed to the application pursuant to a power of attorney, copies of the power of attorney shall be filed with the application for registration. In addition, if the name of any officer signing on behalf of the applicant, or attesting the applicant's seal, is signed pursuant to a power of attorney, certified copies of a resolution of the applicant's board of directors authorizing the signature shall be filed with the application for registration.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.155 Examination Fees

Examination fees for services under the Act are as follows:

a)	Section 4(d)

	1)	Each examiner day or part thereof	$500

	2)	Transportation, lodging, per diem and miscellaneous expense	ACTUAL COST computed in accordance with 80 Ill. Adm. Code 3000

b)	Section 12

	1)	Each examiner day or part thereof	$400

	2)	Transportation, lodging, per diem and miscellaneous expense	ACTUAL COST computed in accordance with 80 Ill. Adm. Code 3000

	3)	Verification Examination
		The Division may conduct an examination for the purpose of verifying that the licensee has taken necessary actions to correct violation of the Act and/or related rules and regulations, when the Director determines the verification examination must be performed on site at any facility of the licensee.

		A) Each examiner day or part thereof	$550

		B) Transportation, lodging, per diem and miscellaneous expense	ACTUAL COST computed in accordance with 80 Ill. Adm. Code 3000

c)	Section 17(f)

	1)	Each examiner day or part thereof	$400

	2)	Transportation, lodging, per diem and miscellaneous expense	ACTUAL COST computed in accordance with 80 Ill. Adm. Code 3000

	3)	Verification Examination The Division may conduct an examination for the purpose of verifying that the licensee has taken necessary actions to correct violations to the Act and/or related rules and regulations, when the Director determines the verification examination must be performed on site at any facility of the licensee.

		A) Each examiner day or part thereof	$550

		B) Transportation, lodging, per diem and miscellaneous expense	ACTUAL COST computed in accordance with 80 Ill. Adm. Code 3000

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.170 Extension of Date for Filing

The Director or the Director's authorized representative may, upon receipt of a written application, extend for up to thirty (30) days any filing deadline set forth in this Part.

Section 8100.190 Provisions for Granting of Variance from Rules

The Director or the Director's authorized representative may grant variances from this Part in individual cases when it is determined that:

a) the provision from which the variance is granted is not statutorily mandated;

b) no party will be injured by granting the variance; and

c) the rule from which the variance is granted would, in the particular case, be unnecessarily burdensome.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

SUBPART B: DEFINITIONS

Section 8100.200 Definitions of terms Used in this Part

a) As used in this Part, unless the context otherwise requires, the term:

"Act" means the Title Insurance Act [215 ILCS 155].

"Delinquency assessment" means any amount, as determined by the Division, payable under Section 15 of the Act and not submitted with the report of each foreign title company as required under Section 8100.1500 of this Part.

"Surplus as regards policyholders" means the total of capital paid-up, gross paid-in and contributed surplus, special surplus funds, unassigned funds less treasury stock at cost, all as shown on the company's balance sheet.

"Consideration" means, but is not limited to, monies, things, salaries, fees, duplicate payments of a charge, stocks, dividends, distributions of partnership profits, credits representing monies that may be paid at a future date, special bank deposits or accounts, banking terms, special loan or loan guarantee terms, services of all types at special or free rates, and sales or rentals at special prices or rates.

"Director's authorized representative" means any person employed by or on behalf of the Division to whom the Director has delegated verbally or in writing authority to act on the Director's behalf.

b) A Section in this Part that defines a term without express reference to the Act or to this Part or to a portion thereof defines that term for all purposes as used both in the Act and in this Part. Terms defined in the Act and not defined in this Part have the meanings given them in the Act.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.205 Definition of the term "Domestic Title Insurance Company" as Used in the Act

The term "Domestic Title Insurance Company" as used in the Act shall mean a title insurance company organized under the laws of this State.

Section 8100.210 Definition of the term "Application" as Used in Sections 4.(d) and 8.(b) of the Act

The term "Application" as used in Section 4.(d) and 8.(b) of the Act shall mean a request in writing under oath containing all the relevant facts upon which a decision can be made, and the specific relief requested.

Section 8100.215 Definition of the term "Audit" as Used in Section 12.(b) of the Act

The term "Audit" as used in Section 12.(b) of the Act shall include, but not be limited to, any annual or special examination, visit or review required under the Act or required by the Director or the Director's authorized representative in carrying out the duties and responsibilities under the Act.

Section 8100.220 Definition of the term "Bonds of the United States" as Used in Section 4.(a) of the Act

The term "Bonds of the United States" as used in Section 4.(a) of the Act shall include bonds, bills and notes issued by the United States, the United States Federal Reserve and direct obligations of the United States of America for the payment of money, or obligations for the payment of money to the extent guaranteed or insured as to the payment of principal and interest by the United States of America.

Section 8100.225 Definition of the term "Bonds ... of Any Body Politic of This State" as Used in Section 4.(a) of the Act

The term "Bonds ... of Any Body Politic of This State" as used in Section 4.(a) of the Act shall mean direct, general obligations of any body politic of this State for the payment of money, or obligations for the payment of money to the extent guaranteed as to the payment of principal and interest by the State on the following conditions:

a) The obligations are payable or guaranteed from ad valorem taxes;

b) Such body politic is not in default in the payment of principal or interest of any of its direct or guaranteed obligations; and

c) No investment shall be made in obligations which are secured only by special assessments.

Section 8100.230 Definition of the term "Bonds ... of This State" as Used in Section 4.(a) of the Act

The term "Bonds ... of This State" as used in Section 4.(a) of the Act shall mean direct, general obligations of this State for the payment of money, or obligations for the payment of money to the extent guaranteed or insured as to the payment of principal and interest by the State on the following conditions:

a) The State has the power to levy taxes for the prompt payment of the principal and interest of such obligations, and

b) The State shall not be in default in the payment of principal or interest on any of its direct, guaranteed or insured obligations at the date of such investment.

Section 8100.235 Definition of the term "Qualified to Do business in This State" as Used in Section 4.(a) of the Act

The term "Qualified to Do Business in This State" as used in Section 4.(a) of the Act shall mean the date of and period in which a company is in compliance with the requirements of the Business Corporation Act of 1983 (Ill. Rev. Stat. 1987, ch. 32, par. 1.10 et seq.).

Section 8100.240 Definition of the term "Title Plant" as Used in Section 7.(b) of the Act

The term "Title Plant" as used in Section 7.(b) of the Act shall mean a set of records in which an entry has been made of documents or matters imparting constructive notice under the law of matters affecting title to real property or any interest therein or encumbrance thereon, which have been filed or recorded in the jurisdiction for which such title plant is maintained.

Section 8100.245 Definition of the term "Net Retained Liability" as Used in Sections 8.(a) and 11.(c)(2) of the Act

The term "Net Retained Liability" as used in Sections 8.(a) and 11.(c)(2) of the Act shall mean the total liability retained by a title insurance company for a single risk, after taking into account the deduction for ceded liability, if any.

Section 8100.250 Definition of the term "Capital" as Used in Section 9.(a) of the Act

The term "Capital" as used in Section 9.(a) of the Act shall mean the paid-up capital of the company.

Section 8100.255 Definition of the term "Notice" as Used in Section 9.(b) of the Act

The term "Notice" as used in Section 9.(b) of the Act shall include, but not be limited to, a communication accomplished by telephone, United States Postal Service, private mail service, computer transaction or facsimile transmission.

Section 8100.260 Definition of the term "Alien Title Insurance Company" as Used in Section 11.(b) of the Act

The term "Alien Title Insurance Company" as used in Section 11.(b) of the Act shall mean any title insurer incorporated or organized under the laws of any foreign nation or any province or territory thereof.

Section 8100.265 Definition of the term "Foreign Title Insurance Company" as Used in Sections 11.(b) and 15 of the Act

The term "Foreign Title Insurance Company" as used in Sections 11.(b) and 15 of the Act shall mean any title insurance company organized under the laws of any other state of the United States, the District of Columbia, or any other jurisdiction of the United States.

Section 8100.270 Definition of the term "Like Purposes" as Used in Section 15 of the Act

The term "Like Purposes" as used in Section 15 of the Act shall not include the fee specified in Section 14.(b) of the Act.

Section 8100.275 Definition of the term "Party" as Used in Section 23 of the Act

The term "Party" as used in Section 23 of the Act shall include, but not be limited to, all holders of or applicants for any certificate of authority or registration, their agents, servants and employees, whether they are natural persons, corporations, partnerships, associations, cooperatives, trusts or other legal entities.

Section 8100.280 Definition of the term "Person" as Used in Section 24 of the Act

The term "Person" as used in Section 24 of the Act shall include, but not be limited to, all holders of or applicants for any certificate of authority or registration, their agents, servants and employees, whether they are natural persons, corporations, partnerships, associations, cooperatives, trusts or other legal entities.

SUBPART C: TITLE INSURANCE COMPANIES

Section 8100.400 Bonds and Securities Acceptable for Deposit

Each Title Insurance Company ("company") prior to becoming certified by the Director to transact the business of insuring and guaranteeing titles to real estate in this State shall deposit with the Division bonds of the United States, this State or any body politic of this State in the amount specified by Section 4(b) of the Act ("bonds"). No other bonds or securities are acceptable for deposit.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.401 Place of Deposit

Each company shall:

a) instead of physical delivery of the bonds to the Division, place the required deposit in the custody of any trust company or bank located in this State and qualified to do business under the Corporate Fiduciary Act [205 ILCS 620] ("Depository Institution");

b) execute and deliver to the Division a Pledgor/Pledgee Authorization form for filing with the Depository Institution; and

c) file with the Division a true and correct copy of an acknowledgement issued by the Depository Institution setting forth the amount of and description of the bonds on deposit.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.402 Computation of Amount on Deposit

Each Company shall compute the value of the Bonds on deposit on at least a quarterly basis. The computation shall be made using the actual cash value of each Bond, not face value. At all times, the actual cash value of the Bonds on deposit must be equal to or greater than the amount required to be on deposit , as specified under Section 4.(b) of the Act.

(Source: Amended at 26 Ill. Reg. 14265, effective October 1, 2002)

Section 8100.403 Exchange of Bonds on Deposit

No Company shall exchange, substitute, remove, encumber, or hypothecate, Bonds on deposit without receiving prior thereto written approval from the Director or the Director's authorized representative.

Section 8100.900 Impairment

Impairment occurs:

a) when an insurer does not possess assets equal to at least its total statutory liabilities; or

b) when its surplus as regards policyholders is 75% or less of the paid-up capital as shown in the most recent annual statement of the company on file with the Division.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.905 Definition of the Term "Statutory Liabilities" as Used in This Subpart

The term "statutory liabilities" as used in this Subpart shall mean the total liabilities of the company as shown in its most recent annual statement on file with the Division.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.1000 Date of Redetermination of Required Reserves

Each Company shall redetermine the reserves required under Section 10 of the Act annually as of December 31st regardless of the date when the initial reserve against unpaid losses and loss expenses were established.

Section 8100.1005 Records of Required Reserves

Each Company shall maintain for each claim file a chronological record of each notice received which results in a revision or readjustment to the reserve against unpaid losses or loss expense.

Section 8100.1100 Records of Statutory Premium Reserve

Each Company shall maintain a record of the statutory premium reserve required pursuant to Section 11 of the Act, which sets forth the basis of and computation of the reserve, along with the amount of, date of and computation of each amount released from the reserve.

Section 8100.1200 Consumer Complaints

Each company shall maintain for review by the Division:

a) A file or consumer complaint register containing each written complaint received from any person or party regarding property located in this State other than matters for which a separate claim file has been opened, together with the response to or resolution of the complaint.

b) The files must be maintained during each audit period and will be reviewed by and released by the Division's examiner at the time of annual audit. The completion of the audit without limitation to the contrary shall constitute release and permit the company to dispose of complaints responded to or otherwise resolved.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.1300 Report of Condition

a) Each Company shall file a report of condition pursuant to Section 13 of the Act which includes, but is not limited to:

1) an audited financial statement;

2) the current address and telephone number of the main administrative office;

3) the primary location of books and records;

4) a list of officers and directors;

5) a list of and analysis of investments;

6) a schedule of special and regular deposits;

7) a list of subsidiary, controlled or affiliated companies;

8) an organization chart;

9) a narrative report of all contingencies which may have a material affect on finances or operations; and

10) the date of and state conducting the latest financial examination of the company.

b) The Director or the Director's authorized representative, after review of the report of condition, may request further and additional information to assure the business repute and qualifications of the Company.

c) National Association of Insurance Commissioners Form 9 is acceptable as a report of condition pursuant to this Section.

Section 8100.1500 Due Date for Filing Report

Each foreign title insurance company shall file not later than May 15^th of each year a report setting forth the basis for, computation of and amount due pursuant to Section 15 of the Act.

Section 8100.1505 Due Date for Deposits and Payments

All amounts due pursuant to Section 15 of the Act shall be paid to and received by the Division not later than May 15 of each year.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.1510 Review of Reports

Each report filed with the Division will be reviewed. A report of the review, including any delinquency assessment, will be submitted to the filing company.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.1515 Due Date for Delinquency Assessment

Amounts due pursuant to the delinquency assessment shall be paid to and received by the Division within 30 days after the date of issuance of the delinquency assessment.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

SUBPART D: TITLE INSURANCE AGENTS

Section 8100.1600 Registration of Title Insurance Agents

a) Each company shall make the annual filing of the required registration form for title insurance agents on or before February 1 of each year. Included with the filing shall be the annual fee computed in accordance with Section 14(b) of the Act.

b) Each company shall file supplemental registrations for new title insurance agents. Each new title insurance agent shall be registered with the Division within 30 days after the signing of the agency agreement.

c) No title insurance agent shall conduct business before:

1) having obtained errors and omissions insurance, if required by the terms of the agency agreement, in an amount acceptable to the title insurance company appointing the agent; and

2) being registered with the Division.

d) A company may voluntarily withdraw the registration of a title insurance agent or limit the duties of a title insurance agent. Within 5 business days after the withdrawal or limitation, the company shall notify the Division of the action taken.

e) Withdrawal of the registration of a title insurance agent or limitation of the duties of a title insurance agent shall not be deemed to prevent the Division from taking action under Section 21(a) of the Act.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

SUBPART E: INDEPENDENT ESCROWEES

Section 8100.1700 Bonds and Securities Acceptable for Deposit

Each independent escrowee, prior to becoming certified by the Director to transact business in this State, shall deposit with the Division bonds of the United States, this State or any body politic of this State in the amount specified by Section 4(b) of the Act ("bonds"). No other bonds or securities are acceptable for deposit.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.1701 Place of Deposit

Each independent escrowee shall:

b) execute and deliver to the Division, a Pledgor/Pledgee Authorization form for filing with the Depository Institution; and

c) file with the Division a true and correct copy of the safekeeping certificate issued by the Depository Institution setting forth the amount of and description of the bonds on deposit.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.1702 Computation of Amount on Deposit

Each independent escrowee shall compute the value of the Bonds on deposit. The computation will be made using the actual cash value of each Bond, not face value. At all times, the actual cash value of the Bonds on deposit must equal at least 95% of the face value of the Bonds on deposit, as specified under Section 4.(b) of the Act.

Section 8100.1703 Exchange of Bonds on Deposit

No independent escrowee shall exchange, substitute, remove, encumber or hypothecate Bonds on deposit without receiving prior thereto written approval from the Director or the Director's authorized representative.

Section 8100.1704 Starker Exchange

Licensed attorneys, retained by the parties to a real estate transaction to act solely as escrowee, trustee or other capacity in effectuating a Starker exchange (Starker vs. U.S., 602 F.2d 1341 (9^th Cir. 1979)) or other similar transaction, structured to obtain favorable tax treatment under the Internal Revenue Code or other tax law, are not independent escrowees.

Section 8100.1705 Independent Accountant

The Annual Report and all financial statements provided to the Division by an independent escrowee shall be prepared by an independent certified public accountant.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

Section 8100.1706 Notice of Judgments

An independent escrowee shall notify the Director, in writing, immediately upon becoming aware of an entry of a money judgment in a civil action against the independent escrowee, or entry of a judgment involving moral turpitude against any independent escrowee, officer, or director of an independent escrowee, or after the filing of a criminal action involving moral turpitude against the independent escrowee, or any of its officers, or directors.

Section 8100.1708 Maintenance of Books

An independent escrowee shall maintain its books, records and accounts and shall notify the Director in writing of the location of its books, records and accounts. Such books, records and accounts shall be maintained at such location unless the independent escrowee shall notify the Director in writing at least fifteen (15) days prior to changing the location of such books.

Section 8100.1710 Annual Report

a) An independent escrowee shall make an annual report;

b) The annual report shall include, but is not limited to:

1) an audited financial statement;

2) the current address and telephone number of the main administrative office;

3) the primary location of books and records;

4) a list of officers, directors and shareholders including addresses;

5) a list of and analysis of investments;

6) a schedule of special and regular deposits;

7) a list of subsidiary, controlled or affiliated companies;

8) an organization chart;

9) a narrative report of all contingencies which may have a material affect on finances or operations; and

10) the date of and state conducting the latest financial examination of the company.

c) The Director or the Director's authorized representative, after review of the annual report, may request further and additional information to assure the business repute and qualifications of the Company.

Section 8100.1712 Due Date for Filing of Annual Report

Each independent escrowee shall file an annual report not later than March 31^st of each year.

Section 8100.1714 Confirmation of Escrow Fund and Liability

The annual report shall include a statement that the escrow fund was confirmed by the accountant in writing directly with the depositories and that the escrow liability was confirmed by the accountant in writing directly with escrow depositors of at least twenty-five (25) escrow accounts or one-fourth of the number of escrow accounts having balances at the reporting date, whichever number is greater. If the independent escrowee has less than twenty-five (25) such accounts, all shall be confirmed.

Section 8100.1716 Basis of Books

An independent escrowee shall maintain its books, records and accounts in accordance with generally accepted accounting principles (Accounting Standards of the Financial Accounting Standards Board of the American Institute of Certified Public Accountants (1989)).

Section 8100.1718 Posting Dates

All receipts and disbursements of monies by an independent escrowee shall be posted in the escrow ledger as of the date of such receipts and disbursements.

Section 8100.1720 Escrow Books

An independent escrowee shall establish and maintain current the following books with reference to its escrow accounts:

a) escrow ledger containing a separate ledger sheet for each escrow;

b) escrow liability controlling account; and

c) cash receipt and disbursement journal or a file containing copies of all receipts and checks and/or check stubs of checks issued by the escrow agent as a medium of posting to the records referred to in subsections (a) and (b) in which case adding machine tapes of totals of receipts and checks shall be retained. The records referred to in subsections (a) and (b) shall be reconciled at least once each month with the bank statements of the "trust" or "escrow" account. The records referred to in subsection (a) shall be reconciled at least once each week with the escrow liability controlling account referred to in subsection (b).

Section 8100.1722 General Books

An independent escrowee shall establish and maintain current the following books with reference to its general accounts:

a) general ledger reflecting the assets, liabilities, capital, income and expense of the business, in accordance with generally accepted accounting principles (Accounting Standards of the Financial Accounting Standards Board of the American Institute of Certified Public Accountants (1989)); and

b) cash receipt and disbursement journals.

Section 8100.1724 Special Accounts

a) All money received by an independent escrowee as part of an escrow transaction shall on or before the close of the next full working day after such receipt be deposited in a bank, a savings bank, a savings and loan association or credit union ("financial institution") in an account designated "trust" or "escrow" account, or in an account otherwise designated by a name indicating that the funds contained therein are not the funds of the escrow agent, but only if such other designation has been first approved by the Director. No funds other than those received as part of an escrow transaction shall be deposited in such account or otherwise commingled with escrow money.

b) Pursuant to written instructions of the principals containing at least the provisions required by subsection (c), funds received in any particular escrow transaction and deposited pursuant to subsection (a) may subsequently be deposited into an interest-bearing escrow account established solely for such purpose at a financial institution in the name of the independent escrowee as trustee for the principals to the particular escrow identified by escrow number.

c) The escrow instructions for interest-bearing escrow deposits shall, at a minimum:

1) authorize the opening of an interest-bearing escrow account in the name of the independent escrowee as trustee for the particular escrow identified by escrow number;

2) specify the type of account to be opened and the amount of the deposit;

3) identify the name and location of the financial institution with which the interest-bearing account is to be opened;

4) specify:

A) the disposition of the interest at the close of escrow;

B) the disposition of the interest in the event that the escrow fails to close; and

C) the disposition of any accrued interest retained in the interest-bearing escrow account after the close of escrow pursuant to subsection (g);

5) indicate that the principals have been advised by the independent escrowee of possible restrictions or penalties, or both for early withdrawal of funds; and

6) prohibit the independent escrowee from withdrawing funds from the interest-bearing account except for redeposit into the "trust" or "escrow" account.

d) An independent escrowee is responsible for establishing and maintaining an interest-bearing account so that the funds are fully insured or guaranteed, to the extent available by law.

e) An independent escrowee is responsible for establishing and maintaining adequate controls over the passbooks and certificates issued by financial institutions in connection with interest-bearing escrow accounts.

f) An independent escrowee depositing escrow funds into interest-bearing escrow accounts shall establish and maintain a control ledger summarizing the deposits in interest-bearing escrow accounts or shall make a memo entry on each individual escrow ledger. The posting of the ledger shall include the escrow number, interest-bearing account number, date of deposit, and amount of deposit.

g) All funds deposited into an interest-bearing escrow account, including any interest paid thereon, shall be transferred from such account into the "trust" or "escrow" account before the close of escrow, except that a specified portion of all the interest accrued may be retained in the interest-bearing escrow account until the end of the current calendar quarter if the escrow instructions of the principals so provide.

h) Disbursements from the "trust" or "escrow" account shall not be made against funds deposited in an interest-bearing escrow account until such funds have been transferred and receipted into the "escrow" or "trust" account with proper posting to the particular escrow.

i) No electronic fund transfers, except in commercial transactions, shall be made between the "trust" or "escrow" account and any interest-bearing account. Transfers shall be made only in a manner consistent with the provisions of Section 8100.1744 of this Part.

j) Interest paid on any interest-bearing escrow account shall be paid over to the principal having deposited the moneys in escrow unless the escrow instructions clearly specify that such interest is to be paid over to a named person.

k) An independent escrowee which wishes to transact business as an escrow agent on a basis other than as provided by this Subpart may request in writing a variance to or waiver of any provisions of this Subpart, but may not engage in business in a manner not in compliance with this Subpart without first having received a waiver or variance in writing from the Director or the Director's authorized representative.

l) Any request for a variance or waiver shall include at least:

1) a statement of the basis upon which the escrow agent's business is proposed to be transacted in connection with a particular named financial institution;

2) a description of the plan of business and applicable procedures including copies of all agreements or memoranda of understanding between the independent escrowee and the financial institution;

3) a showing that the proposed plan of business and applicable procedures provide for administrative and accounting controls at least as adequate as those provided in this Subpart; and

4) a statement of the reasons why, under the escrow agent's circumstances, a variance or waiver is requested.

m) Any variance or waiver granted pursuant to this Subpart by the Director or the Director's authorized representative shall be in writing and subject to such terms and conditions as may be deemed necessary or advisable by the Director or the Director's authorized representative to protect any escrow relationship.

Section 8100.1726 Records to be Preserved

An independent escrowee shall preserve for at least three (3) years from the close of escrow:

a) all bank statements of the "trust" or "escrow" account;

b) all canceled checks drawn upon the "trust" or "escrow" account;

c) copies of bank deposit slips with reference to the "trust" or "escrow" account;

d) all additional records reflecting banking transactions with reference to the "trust" or "escrow" account, including copies of all receipts for funds transferred from interest-bearing accounts into the "trust" or "escrow" account;

e) the Statement of Account;

f) escrow instructions and amendments thereto; and

g) all additional records pertinent to the escrow transaction.

Section 8100.1728 Withdrawals From Special Accounts

All money deposited in such "trust" or "escrow" account shall be withdrawn, paid out, or transferred to other accounts only in accordance with the written instructions of the principals to the escrow transaction or pursuant to order of a court of competent jurisdiction.

Section 8100.1730 Debit Balances Prohibited

An independent escrowee shall not withdraw, pay out or transfer moneys from any particular escrow account in excess of the amount to the credit of such account at the time of such withdrawal, payment or transfer.

Section 8100.1732 Delivery of Documents or Property

An independent escrowee shall use documents or other property deposited in escrow only in accordance with the written instructions of the principals to the escrow transaction, or if not otherwise directed by written instructions, in accordance with sound escrow practice, or pursuant to order of a court of competent jurisdiction.

Section 8100.1734 Dated Instructions

All escrow instructions shall be dated.

Section 8100.1738 Printed Instructions

a) A preprinted form of escrow instructions shall not contain:

1) an authorization or direction to disburse any money except to an authorized independent escrowee prior to recordation of instruments in escrows relating to real property or prior to consummation of sale in escrows relating to bulk sales of personal property; or

2) an authorization or direction to deliver, except to a duly authorized subescrow agent or record instruments affecting ownership or interest in real or personal property, prior to deposit with the independent escrowee of the full sum of money required to be deposited in escrow under escrow instruction.

b) Nothing contained in this Section shall prohibit:

1) the insertion of such authorization in the form of escrow instructions, in handwriting or typewriting, at the direction of the party executing such instructions; or

2) an instruction authorizing disbursements in payment of services, fees or other items of expense.

Section 8100.1740 Withdrawal of Escrow Fees

Earned escrow fees shall be withdrawn from such "trust" or "escrow" account at least once each month.

Section 8100.1742 Notice of Interest

An independent escrowee shall act without partiality to any of the parties to an escrow transaction. If an independent escrowee or a person or company related to or affiliated with the independent escrowee is a principal to the escrow transaction or is acting or has acted in a capacity which can be construed as a conflict of interest in relation to the escrow transaction, the independent escrowee shall advise in writing all parties to the escrow transaction of such relationship or affiliation before being employed as independent escrowee in connection with such transaction. Such advice shall be on the face of the escrow instructions in not less that eight (8) point bold type or its equivalent.

Section 8100.1744 Transfers Between Escrows

Transfers of funds between escrows may not be accomplished by the making of book entries alone, but must be accomplished by the actual writing of a check from one escrow to the other, and by the depositing of such check for the account of, and the writing of a receipt for, the escrow to which the funds are being transferred. Such transfers must also be properly supported and documented in the escrow files by inclusion of the reasons for, and the appropriate approval of, the transfer.

Section 8100.1746 Escrow Receipts

An independent escrowee shall issue consecutively prenumbered receipts for all escrow money or checks deposited with or mailed to the independent escrowee and retain copies of such receipts in a separate file.

Section 8100.1748 Drawing of Checks

A check shall not be drawn, executed or dated prior to the existence, in the particular escrow account against which it is drawn, executed or dated, of a sufficient credit balance to cover said check.

Section 8100.1750 Statement of Account

Upon completion of an escrow transaction, an independent escrowee shall render to each principal to the escrow transaction a statement of the principal's account in writing. Such statement shall specify all receipts and disbursements of escrow funds for the principal's account. Charges made by the independent escrowee for its services shall be clearly designated as such and shall be shown separately. Payments outside of escrow, if shown in the statement, shall be set forth separately from payments by or to the independent escrowee.

SUBPART G: EVIDENTIARY MATTERS AND NON-BINDING STATEMENTS

Section 8100.2010 Request for Non-Binding Statements

a) Required information and format:

1) All requests for non-binding statements shall be in writing. The request shall be filed with the Division and shall contain the following:

A) a brief summary of the Sections of the Act and of the Sections of this Part to which the request pertains;

B) a detailed factual representation concerning every relevant aspect of the proposed transaction, event or circumstance. Requests should be limited to the particular situation, and should not attempt to include every possible type of situation that may arise in the future;

C) a discussion of current statutes, rules and legal principles relevant to the facts set forth;

D) a statement by the person requesting the non-binding statement that states the person's own opinion in the matter and the basis for that opinion; and

E) a representation that the transaction in question has not been commenced or, if it has commenced, the present status of the transaction.

2) The Division will not respond to requests for non-binding statements involving the anti-fraud provisions of the Act.

3) The Division will not respond to requests for non-binding statements with respect to transactions that have already taken place.

4) The Division will not respond to requests based upon hypothetical facts or involving unnamed parties.

b) Review procedure under the Act:

1) The Division's review of requests for non-binding statements require an in-depth examination of the information presented and the applicable law. Therefore, a considerable time period may elapse before the statement is issued.

2) After a review of the relevant facts presented, in light of existing judicial, legislative and administrative history, the Division shall either decline to issue any findings or issue its finding as to the applicability of the Act to the situation presented in the form of a non-binding statement, stating that it will or will not recommend that enforcement action be initiated against the parties involved if all the facts are true and complete. Facts or conditions different than those presented will require different conclusions and persons other than those requesting the statement should not rely on the statement. Non-binding statements do not have precedent value.

c) Availability of non-binding statements issued by the Division:

1) The Division will maintain an index by statutory Section involved and chronologically of all non-binding statements issued.

2) Copies of statements can be reviewed in the Division's Springfield office and copies may be obtained upon payment of the cost of duplication as set forth in 2 Ill. Adm. Code 901.80.

(Source: Amended at 34 Ill. Reg. 852, effective December 29, 2009)

SUBPART H: PROCEDURES FOR ADMINISTRATIVE HEARINGS

Section 8100.2100 Hearings

All administrative hearings shall be conducted in accordance with 38 Ill. Adm. Code 100.

(Source: Amended at 46 Ill. Reg. 12582, effective July 8, 2022)

Section 8100.2102 Qualifications and Duties of the Hearing Officer (Repealed)