FinCEN Renews Geographic Targeting Orders for 12 Metropolitan Areas

November 10, 2020

The Financial Crimes Enforcement Network (FinCEN) renewed its Geographic Targeting Orders (GTOs) that require U.S. title insurance companies to identify the natural persons behind shell companies used in all-cash purchases of residential real estate.  

The renewed GTOs are identical to the May 2020 GTOs. The purchase amount threshold remains $300,000 for each covered metropolitan area. The orders are effective through May 4, 2021. 

According to FinCEN, GTOs continue to provide valuable data on the purchase of residential real estate by persons possibly involved in various illicit enterprises. Reissuing the GTOs will further assist in tracking illicit funds and other criminal or illicit activity, as well as inform FinCEN’s future regulatory efforts in this sector.

The orders cover certain counties within the following major U.S. metropolitan areas: Boston; Chicago; Dallas-Fort Worth; Honolulu; Las Vegas; Los Angeles; Miami; New York City; San Antonio; San Diego; San Francisco; and Seattle. 

FinCEN appreciates the continued assistance and cooperation of the title insurance companies and the American Land Title Association in protecting the real estate markets from abuse by illicit actors.

During the summer, the U.S. Government Accountability Office (GAO) recommended in a 41-page report that FinCEN develop additional guidelines to help with oversight, outreach and evaluation when issuing real estate GTOs.

The main purpose of the study was to look at the cost burden of the GTO and examine potential loopholes in the GTOs. ALTA provided background information to GAO investigators to help with the study. ALTA also a call with GAO staff and 20 of ALTAs, including agents and underwriters. Additionally, ALTA connected the GAO with individual agents to learn about the GTO compliance process.

ALTA has developed several tools to help members comply with the order. Companies can email questions about the orders to FinCEN’s Regulatory Support Section at [email protected].

Frequently asked questions regarding the GTOs are available here.

Contact ALTA at 202-296-3671 or [email protected].