Fiduciary Capacity & Fraud Prevention Part I (AC July 2026)

RESA Registered Settlement Agent duties are addressed in part at Virginia Code § 55.1-1008. Conditions for providing escrow, closing, or settlement services and for maintaining escrow accounts. All funds deposited with the settlement agent in connection with an escrow, settlement, or closing shall be handled in a fiduciary capacity and submitted for collection, or deposited in a separate fiduciary trust account or accounts in a financial institution authorized to do business in the Commonwealth no later than the close of the second business day...

We invite you to consider as a trusted Fiduciary Agent acting on behalf of and for the benefit of another, any, and all-fraud prevention measures, as discussed below, for your escrow accounts.

• Only close with collected funds. 

• Ensure new escrow employees are well-trained.

• Consider adding a recommended layer of protection to escrow accounts with ClosingLock, CertifID, or PayOffAssist to prevent wire fraud. Your software vendor may offer wire or payoff fraud protection, as well. 

• Monthly "three-way reconciliations" of ALL escrow accounts, including dormant, premium, and recording accounts, are required by Agency Agreement and by state regulators.

• In addition to the monthly reconciliation, bank account activity should be monitored daily. Daily reconciliation includes verification of all receipts and disbursement.

• Indicate management review of reconciliation reports as required by the Bureau of Insurance by signing and dating on cover sheets, monthly. Ensure that proper segregation of duties is in place, especially segregating check signors from those authorized to perform bank reconciliations. 

• Dual control over wire transfers is highly recommended. Do not share passwords or tokens to online bank accounts with anyone for any reason.

• Ensure that Payee Positive Pay, Positive Pay (regular), or Reverse Positive Pay is established for all escrow accounts. Review any exceptions in accordance with the banks' instructions and timelines. Set the default to "return" any exception items where no decision has been made. 

• When switching to another software vendor, you must open new escrow accounts. The dormant account must be cleared down to zero balance and properly closed.

If you would like to see a specific topic covered, or have any audit or escrow questions, email us at VAAuditing@OldRepublicTitle.com.