Suing and Serving Phantoms and Ghosts in Real Estate Quiet Title Cases 

By Nate Bernstein

A “Quiet Title” lawsuit is filed by an owner of real property in court to resolve a problem with real estate title. The local county superior court where the property is situated has subject matter jurisdiction to handle this type of case. See generally Cal. C.C.P. Section 760.040 (a)-(c). The case is litigated in the unlimited jurisdiction division of the court, and is not a small claims case. The California quiet title statute is set forth in Chapter 4 of the Code of Civil Procedure at sections 760.010 to 764.080. The law of quiet title is also controlled by precedent in appellate case law. Along with the quiet title lawsuit, the plaintiff is required to record a lis pendens notice at the county recorder’s office to provide notice that an action is pending involving a real estate title dispute. Every owner wants to have a “clean title” without gaps or other problems, and every lender wants to have their deed of trust in the position on title that they expected and bargained for in the prior escrow. The overall objectives of pursuing a quiet title action is to bring in all interested parties that have an interest in the property before the court, to resolve the title problem and to obtain a title for the plaintiff that is marketable and insurable by a title insurance company for a sale or refinance. Both the legal and financial stakes can be high in quiet title litigation because without a clear title the owner cannot sell or refinance, and a lender cannot protect its priority title position.  

Issues litigated in quiet title actions are numerous and complex, and can involve multiple parties with an interest in the property. Hallmark factual examples include a fraudulent transfer of a forged title deed by an unknown third party, an unauthorized deed transfer or encumbrance by a co-owner or business partner, a transfer prior to the filing of a bank foreclosure or bankruptcy that causes a gap or cloud in the chain of title, a lost and unrecorded deed that caused a cloud on title, the recordation of a fraudulent deed or deed of trust that the owner did not authorize, a related partnership dispute, or a dispute about the percentage of equitable ownership. Quiet title claims can be brought with other claims, such as fraud or breach of contract. The local superior court is equipped to adjudicate all of these types of title disputes, and can enter a judgment after trial to provide relief to solve the problem. 

Suing the Living and the Dead in Quiet Title Actions

Generally, it is relatively easy to determine who to name as a defendant in a quiet title action. The commonsense formula is to name any person or entity on the planet that has an actual or potential legal or equitable right, title, estate, lien and interest in the subject property that is “adverse” to the right, title and interest of the plaintiff. Pursuant to Cal. CCP Section 762.010, the plaintiff shall name as defendants in the action the persons having adverse claims to the title of the plaintiff against which a determination is sought. The plaintiff should also sue any party that the plaintiff, a title insurance company, or the court wants to be bound by the quiet title judgment determination, including a co-owner or holder of a recorded deed of trust. The adverse party defendant has the right to defend the action, and to present the defendant’s case and any defenses. In short, all sued parties get their day in court.   

It is generally not necessary or advisable to automatically sue the plaintiff’s mortgage bank if the bank’s deed of trust lien interest is not adverse to the interest of the plaintiff. For example, the plaintiff obtained a mortgage loan on favorable terms, and was intended to be in first title position, there is no title dispute with the lender, and the plaintiff does not dispute that fact. A plaintiff can give a mortgage holder party or deed of trust holder notice of the action by serving the party or deed of trust holder and its loan servicer with a recorded lis pendens notice. If that mortgage party wants to intervene in the litigation, that party can be named as a defendant or can apply to the court to intervene in the action to have its claim heard.     

Sometimes because of a time lapse or in other situations, a party that must be named in the quiet title action has died. However, technically speaking you cannot sue and serve a dead person. You can’t show up at the cemetery and drop the complaint and summons at the grave site.  If the person is cremated, personal service of the summons is even more of a challenge!   

If a defendant to be named is dead or believed to be dead, the legislature envisioned this “Tales of the Crypt” type of situation and you can sue pursuant to Cal. CCP Section 762.030. You can sue in the local superior court of general jurisdiction, and there may be no need to file an action or proceeding in probate court. A probate case may or may not be pending.  If the person who died has an executor or administrator, you sue the personal representative of the deceased or of his estate. If the person who died does not have a personal representative and no estate or probate, then you sue the “testate and intestate successors.” This code section provides:

    “(a) If a person required to be named as a defendant is dead and the plaintiff knows of a personal representative, the plaintiff shall join the personal representative as a     defendant.

    (b) If a person required to be named as a defendant is dead, or is believed by the plaintiff to be dead, and the plaintiff knows of no personal representative:

    (1) The plaintiff shall state these facts in an affidavit filed with the complaint.

    (2) Where it is stated in the affidavit that such person is dead, the plaintiff may join as defendants “the testate and intestate successors of __________ (naming     the deceased person), deceased, and all persons claiming by, through, or under such decedent,” naming them in that manner.

    (3) Where it is stated in the affidavit that such person is believed to be dead, the plaintiff may join the person as a defendant, and may also join “the testate and intestate     successors of __________ (naming the person) believed to be deceased, and all persons claiming by, through, or under such person,” naming them in that manner.”

Suing the “testate and intestate successors of the deceased” is relatively straightforward. You just name this class in the complaint and summons by using the language required in the statute. The plaintiff also files an affidavit at the time of filing the complaint. Serving this class with the lawsuit is more problematic because this class may not exist as a real person or entity and there is no residential or business address to use for attempted personal and direct service. The deceased may not have “testate or intestate successors” or heirs. The plaintiff or plaintiff’s attorney may not learn about a successor until after the filing. If a successor exists who claims an interest in the subject property, that person or entity should be named in the lawsuit. The only way to complete service of the unknown testate and intestate successors is to serve this class of defendant by publication. Service by publication will require the requisite due diligence to obtain a court order to serve by publication. See Cal. CCP 763.010.

Suing the Ghost Defendant Category Known As ‘All Persons Unknown’

When prosecuting a quiet title action, you want to be sure that you sue any person in the chain of title who has an adverse interest in comparison to the rights of the plaintiff, and also to sue anyone else on the planet who may have an “adverse” interest in the property as compared with the plaintiff. You want to sue any potential party who may claim a direct or indirect interest in a property. A review of an up-to-date preliminary title report for the subject property will usually reveal any person in the chain of title with an interest that was recorded. You may have an investor or stakeholder who claims an interest in the property, but who is not on record title profile. Sometimes, the true owners may not qualify for a loan, and have a relative or friend with a strong credit profile to obtain the loan and be on title. The true owner will still put down a downpayment for the purchase price. This seemingly covert equitable owner may be living at the subject property and paying the mortgage but is not on the record title.  

It is recommended to also name as a defendant in the action pursuant to CCP S. 762.060 “all persons unknown.” The statute provides:      

    “(a)  In addition to the persons required to be named as defendants in the action, the plaintiff may name as defendants “all persons unknown, claiming any legal or     equitable right, title, estate, lien, or interest in the property described in the complaint adverse to plaintiff’s title, or any cloud upon plaintiff’s title thereto,” naming them in     that manner.”  

The name of this phantom defendant should be stated in the caption in the complaint and summons.    

The Method for Serving Phantom and Ghost Parties With the Lawsuit is Delineated in the Quiet Title Statute

When you sue “testate and intestate successors” or “all persons unknown,” you still need to serve these phantoms and ghosts with the summons and complaint. But how do you serve this fictitious class of defendant that technically do not really exist in the world? These defendant categories are only a creature of the quiet title statute.  Personal or substituted service is not possible. If it is not Halloween night these ghosts and phantoms don’t come out of the shadows to accept service. The answer to resolve this dilemma is set forth in Cal. CCP S. 763.010, which provides” 

    “763.010. (a) The form, content, and manner of the service of summons shall be the same as in civil actions generally.

    (b) If upon affidavit it appears to the satisfaction of the court that the plaintiff has used reasonable diligence to ascertain the identity and residence of and to serve     summons on the persons named as unknown defendants and persons joined as testate or intestate successors of a person known or believed to be dead, the court shall     order service by publication pursuant to Section 415.50 and the provisions of this article. The court may, in its discretion, appoint a referee to investigate whether the     plaintiff has used reasonable diligence to ascertain the identity and residence of persons sought to be served by publication, and the court may rely on the report of the     referee instead of the affidavit of the plaintiff in making the order for service by publication.

    (a) Nothing in this section authorizes service by publication upon any person named as an unknown defendant who is in open and actual possession of the property.

The statutory requirement of exercising due diligence to find these ghosts and phantoms is quite peculiar and awkward. How can you perform due diligence to find someone that does not in reality exist in this world? The mind set for this form of due diligence is to perform it with an approach that perhaps you will find a person who was previously “unknown,” or who is a potential successor interest. If they fit in the statutory category and have a connection with the subject property, then that person should be named in the lawsuit.  

If anyone in this phantom class of defendants emerges from out of the wood work to claim an interest in the property, this person or entity can be added as a DOE defendant after the case was filed.  Alternatively, this party may want to intervene in the action and file its own cross-complaint if the stakes are high enough.   

For the court to obtain personal jurisdiction over these ghosts and phantoms, you need to serve these defendants by publication. This process involves making a separate application to the court, demonstrating specific due diligence, obtaining a Court order to allow for service by publication. The service is completed by complying with the court order for service by publication which usually requires publishing notice in a local newspaper and posting on the subject property.   

Defining ‘Due Diligence’ in Searching for the Phantom and Ghost Defendants

As explained above, in order to serve “testate and intestate successors” or “unknown persons” with the summons and complaint, the law requires service by obtaining a court order of publication. To obtain the court order for publication you need to demonstrate due diligence as a matter of law. See generally Friends of Del Mar Bluffs v. North County Transit (2022 West Law 1227285) regarding the requirements for serving an individual in a quiet title action by publication under Cal. CCP Section 415.50.  In that case, the Court denied the application for an order for publication without prejudice. The Court denied the application to serve defendants by publication, but opined that the Judicial Council comments to Section 415.50 as instructive in elaborating on the showing required for a trial court to find a party has exercised reasonable diligence in trying to locate the party to be served:

    “The term “reasonable diligence” takes its meaning from the former law:  it denotes a thorough, systematic investigation and inquiry conducted in good faith by the party     or his agent or attorney.  A number of honest attempts to learn defendant’s whereabouts or his address by inquiry of relatives, friends, and acquaintances, or of his     employer, and investigation of appropriate city and telephone directories, the voters’ register, and the real and personal property index in the assessor’s office, near the     defendant’s last known location, are generally sufficient.  These are likely sources of information, and consequently must be searched before resorting to service by     publication. See also Kott v. Superior Court , 45 Cal. App. 4th at 1137-38 (citing Cal. Judicial Council Com., West Ann. Code Civ. Proc. (1973 ed.) Section 415.50, pp. 561-   563. 

Given this standard, how do you perform due diligence on persons or entities that probably do not actually exist anywhere in the world when their identities are not stated on a preliminary title report? This is where you need to be very creative in your due diligence methodology and strategy since databases are largely online and on many different websites. You need to think outside of the box.  You can ask the following questions: Are there living spouses, partners, relatives, heirs or neighbors who may have an interest? Who is leasing the property and in possession? Has a probate case been filed that can be investigated? Has anyone filed another lawsuit concerning the subject property? Did the decedent have a trust or a retirement account that would disclose a potential successor?

This approach requires multiple inquiries and searches by professionals, and the presentation of affidavits and exhibits to demonstrate due diligence. There also needs to be compliance with Cal. CCP Section 415.50(a)(1).   The plaintiff must provide independent evidentiary support, in the form of a sworn statement of facts, for the existence of a cause of action against each defendant whom service by publication is requested.  

Focused Approach and Strategy in Quiet Title Cases

When you need to file a quiet title action in superior court, you might as well file the case against all potential parties to achieve the maximum amount of relief.  That approach includes naming and serving “all persons unknown,” and if a party is deceased, to sue their known personal representative or “testate and intestate successors.”   Service of these phantoms and ghost defendants is completed after obtaining an order of publication.  You can also name actual real person/ entity discovered defendants by filing a doe amendment.  If need be, the plaintiff can amend the complaint to allege additional specific facts about the new doe defendant and this defendant’s connection with the subject property.  

At the end of the day, the main goal is to obtain a recordable quiet title judgment and other vital papers, to achieve a marketable unclouded title such that a title insurance company will write a future title insurance policy for knowing the title defect has been cured. In this process, you can work with a title agent to see what the title officer wants in order to fix the title problem evident in the chain of title. The title agent will not provide formal legal advice, but they will work with you and your counsel and inform you what they need to correct the title problem. It also helps to have a competent judge assigned to your case that understands the law and nuances of quiet title actions, and who can facilitate settlement of the action if that is possible.        

NATE2Nate Bernstein is the managing counsel of LA Real Estate Law Group. He is a member of the State Bar of California and his practice concentrates in the areas of complex real estate title litigation, commercial litigation, employment law and bankruptcy matters. He has served as in house corporate counsel at Fidelity National Title Insurance Co. Bernstein can be reached at [email protected].

Texas, Florida Latest States to Pass Data Privacy Bills

CTEC_Privacy2023_HeatMap_v1 (14)Texas and Florida are likely to soon join four other states that have passed comprehensive data privacy laws in 2023. 

The bills in Texas and Florida await wait their governors' signatures.

The other four states that have passed data privacy laws this year include Montana, Indiana, Iowa and Tennessee.

All the bills contain a Gramm-Leach Bliley Act (GLBA) exemption. ALTA has held that any comprehensive data privacy legislation should include an exemption for entities subject to the GLBA. Since 1999, this federal law has strictly limited financial institutions’ use and sharing of customers’ personal information. Additionally, financial institutions are required to assure the security of this information and provide comprehensive disclosures to consumers. Click here to view ALTA’s principles for data privacy laws.

Additionally, there are exemptions for publicly available data. Each state’s bills can be accessed below:

Five other states—California, Colorado, Connecticut, Utah and Virginia—already have enacted comprehensive consumer data privacy laws. The laws have several provisions in common, such as the right to access and delete personal information and to opt-out of the sale of personal information, among others.


Agent Finds Similarities Between Title Industry, Military

By Frank J. McGovern

In October 2022, I was ordered to trade my title hat for my Army hat as my Pennsylvania National Guard unit was notified for federal overseas duty. We mobilized at Fort Hood, Texas, before arriving at Camp Arifjan, Kuwait, for our tour of duty as part of Operation Spartan Shield (OSS).


Mcgovern kuwait
Col. Frank McGovern presents Al-Shammari with a plaque.

OSS is a USCENTCOM (United States Central Command) operation in the Middle East. OSS is commanded by United States Army Central Command and includes units from all service branches. Task Force Spartan is the U.S. Army Command component (ARCENT) of OSS.

The 28th Infantry Division, from the Commonwealth of Pennsylvania has the great responsibility to lead Task Force Spartan (TFS) which is a unique, multi-component organization, made up of active Army and National Guard units, rounded out by U.S. Army Reserve support units.  I serve as the Staff Judge Advocate (General Counsel) for TFS which has personnel spread across eight different countries in the region.

Through OSS, Task Force Spartan maintains a U.S. military posture in Southwest Asia sufficient to strengthen our defense relationships and build partner capacity to enable peace and stability in the region.

Units supporting OSS provide capabilities such as aviation, logistics, force protection and information management, and facilitate theater security cooperation activities such as key leader engagements, joint exercises, conferences, symposia and humanitarian assistance/disaster response planning.

The United States places importance on its decades-long strategic partnerships in the Middle East region, affirms our enduring commitment to the security and territorial defense of U.S. partners, and recognizes the region’s increasingly important role as a trade and technology crossroads between hemispheres, according to a White House fact sheet.

Moreover, the United States is committed to accelerating ongoing work with its allies and partners in the Middle East to integrate and enhance security cooperation. In particular, the United States is committed to advancing a more integrated and regionally networked air and missile defense architecture and countering the proliferation of unmanned aerial systems and missiles to non-state actors that threaten the peace and security of the region.[1]

The U.S. has reaffirmed its commitment to preserving the free flow of commerce through strategic international waterways like the Bab al-Mandab and the Strait of Hormuz, through which 40 percent of the world’s energy passes every day, via multiple joint naval task forces, in partnership with longstanding U.S. partners integrated through U.S. Central Command.

The U.S. does crucial work together with our friends in this region—to deter aggression from any quarter, to disrupt terrorist networks, and to maintain freedom of navigation in some of the world’s most important waterways.

Our network of allies and partners in the Middle East and beyond is a huge force multiplier and strategic advantage.

Similarities to Title Insurance Industry

Personally, I find commonality in the big picture things of what we are doing over here with what we do in the title insurance industry—innovation, partnerships, legal symposiums for CLE/CE and training, to name a few.

Frank McGovern, a TIPAC state leader and vice chair of ALTA’s Congressional Liaison Committee, attended a fundraiser and presented U.S. Rep. Madeleine Dean (D-Pa.) a $1,000 check on behalf of ALTA.

Regarding innovation, we are always trying to improve upon our processes in the title insurance industry. How can we better serve our clients? How can we more efficiently streamline our product and services. How can we leverage new technologies to improve our services? Think remote work, remote notarization, e-recordings and artificial intelligence. To help with those serving overseas in the military, ALTA-supported Securing and Enabling Commerce Using Remote and Electronic (SECURE) Notarization Act was reintroduced in the Senate. The bipartisan bill, SB1212, would enable use of RON technology by notaries public in interstate commerce and allow signers located outside of the U.S.—such as active-duty military personnel—as well as the elderly and homebuyers with disabilities to securely notarize documents. A companion bill has already passed the U.S. House of Representatives.

In the Middle East, the U.S. also must rely more on innovation to secure the region with more pressing threats in Eastern Europe (Russia) and the Indo-Pacific region (China). The military must make do with fewer resources in the Middle East—which is probably why the National Guard and Reserves make up most of the forces in this theater.

The National Security Strategy identifies China as the top U.S. competitor and “pacing challenge,” with Russia and North Korea not far behind. However, we still must keep our eye on Iran.

There is a lot of partnership and collaboration occurring in the region. There are exercises that units in our Division Task Force are leading in the CENTCOM area of operations involving various warfighting functions such as artillery, air defense, intelligence, civil affairs and infantry. They have cool names such as Juniper Oak, Juniper Falcon, Brightstar, Steel Rainer, Arabian Gulf Gunnery, Desert Hunter, Blade Fold Exercise, Iron Union, Dragon Defender and Saif Strike. Unfortunately, legal symposiums do not receive the cool names unless we are nested with a larger exercise. 

Policymakers and the Pentagon are wrestling with how they can shape the region over the long haul.  There is no NATO in the Middle East. The U.S. wants to be the partner of choice (and I believe we are) of the various countries in the region. Make no mistake that China and Russia have some influence in the region. The countries have a choice as to who they work with likewise as with title agents. Title underwriters, such as the company I work for—Title Resources Guaranty Co. (TRG)—aim to be the partner of choice for agents just like the U.S. wants to be the partner of choice in the Middle East. Granted, it may be easier to get a foot in the door when you are the U.S. However, we must work to keep it that way. The same is true with TRG. We want to get a foot in the door with potential clients. Once an agent works with us, we want to show the agent why they will want to continue to work with us. Moreover, for existing agents we strive to maintain the great relationships we have by showing that we are a steady and reliable partner much like the U.S. aims to do here in the Middle East.

To that end, we as a legal team have well established relationships with some countries where we have regular legal symposiums/exchanges and we seek to build/improve our shared understanding of particular issues and other countries where we seek to build those relationships. My experiences organizing Realtor and title agent CLE/CE has helped me greatly over here. However, in the U.S., we do not need to have slides translated, interpreters lined up and other logistical challenges, but we get it all done and accomplish the mission.

Training our internal legal team is also important because one cannot be in the military forever, you age out generally before you do as a civilian. Hence, I am tasked with ensuring that the team learn and develop in their own individual skill set to build the bench for the future. Jack Welch, former CEO of GE once said: "Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others." Who knows when and where the next dustup will arise, but the US must be ready. Similarly, the title insurance industry must continually look for and develop talent through good times and bad, agents/Underwriters/vendors need to maintain the right balance between senior and junior levels of experience to ensure that the right mix exists to weather any storm. The title industry is discussing ways to attract and retain talent, as is the military. Having a message that attracts the right people and then retaining them after they are trained is of utmost importance in both the military and the title industry.

Some of the team in Kuwait.


Kuwait and many of the oil rich countries in the region such as Qatar, United Arab Emirates and Saudi Arabia have a vast social welfare system for their citizens. For example, in Kuwait citizens are granted free plots of land, housing grants to build houses and free education through university. Water, electricity and fuel costs are subsidized. There is life-long medical care, guaranteed employment and no taxes. However, the total population in Kuwait includes 70% that are non-citizens and they do not enjoy the same benefits.

Kuwait and most of the oil-rich countries in the Middle East are working to diversify their economies away from relying on oil revenues as the U.S. and Western world try to move away from oil and fossil fuels. They are encouraging their citizens to obtain jobs in the private sector because the oil revenues may not always be there in the future. However, for the time being, there are still many countries in the world that are willing to step in and purchase the oil that the West bought, if and when, we decrease our reliance on their oil. Hence, there are opportunities for countries that are not aligned with the U.S. view of the world to step in and gain the influence that the US has had in the Middle East during our lifetime. Thus, it is important to maintain our friendships and partners in the region.

Finally, I am most appreciative for the support that the TRG leadership, industry colleagues and agents have shown me during my time away. I know that there are still businesses to run and time away is a sacrifice for all involved. I look forward to working with all my title friends again in the not-too-distant future.

Frank J. McGovern, Northeast Regional counsel for Title Resources Guaranty Co., is a colonel in the Pennsylvania Army National Guard and currently is deployed to the Middle East. He can be reached at [email protected].

[1] 11Aug2022 TopLine Messages for USARCENT AO


Webinar Recording: The State of Wire Fraud in the Title Industry


Wire fraud is a growing concern in the title industry. Hackers are using increasingly sophisticated techniques to trick title companies and their customers into sending wire transfers to fraudulent accounts. To address this issue, ALTA recently hosted a webinar titled "ALTA Insights: The State of Wire Fraud in the Title Industry." In this webinar, Tom Cronkright, co-founder of CertifID, and Matt McBride, vice president of risk management and compliance for Shaddock National Holdings, discussed the current state of wire fraud in the title industry and offered tips for preventing wire fraud.

The webinar began with an overview of wire fraud and its impact on the title industry. The experts then discussed some of the common techniques that hackers use to perpetrate wire fraud. These include phishing emails, social engineering and malware attacks. Phishing emails are emails that appear to be from a legitimate source, such as a title company, but are actually sent by a hacker. Social engineering involves tricking individuals into divulging sensitive information, such as login credentials, through social interactions. Malware attacks involve infecting a computer with a virus or other malicious software that can be used to steal sensitive information.

Cronkright and McBride walked through how some scams are carried out, including seller impersonation used on vacant properties and mortgage payoffs.

Wire fraud cases
Source: CertifID

To prevent wire fraud, the webinar offered several tips for title companies and their customers. These include:

  1. Verifying wire transfer instructions: Before sending a wire transfer, customers should verify the instructions with the title company using a known phone number or email address. They should not rely solely on the instructions received in an email.

  2. Using multifactor authentication: Title companies should require customers to use multi-factor authentication, such as a password and a security token, to access their accounts.

  3. Educating employees: Title companies should provide training to their employees on how to identify and prevent wire fraud. This can include education on how to recognize phishing emails and how to implement best practices for computer security.

  4. Implementing secure email systems: Title companies should implement secure email systems that use encryption and other security measures to protect against hackers.

The speakers also shared some new techniques used by scammers who have access to more resources than ever to perfect the attacks that lead to wire fraud.

  1. SpoofCard (Call back spoofing): This is when a caller deliberately falsifies the information transmitted to your caller ID display to disguise their identity. Scammers often use neighbor spoofing so it appears that an incoming call is coming from a local number, or spoof a number from a company or a government agency that you may already know and trust. If you answer, they use scam scripts to try to steal your money or valuable personal information, which can be used in fraudulent activity.
  2. Deepfake (AI voice replication): Artificial intelligence voice cloning is a deepfake technique that can analyze and replicate a human's voice. All it requires is a short voice sample of the human voice you want to replicate, and the AI will learn it instantly.
  3. Influence Bots (open-source intelligence): Social bots are a current phenomenon in social media and are increasingly used to influence users of social platforms.
  4. SIM swap (SS7 Network): This is a type of account takeover fraud that generally targets a weakness in two-factor authentication and two-step verification in which the second factor or step is a text message (SMS) or call placed to a mobile telephone.
  5. AI-generated attack emails: Chat GPT AI text-generating interfaces are being used to create malicious messages designed to spearphish, scam, harass and spread fake news. These AI-based systems can also be used for BEC scams.

By following these tips and implementing best practices for preventing wire fraud, title companies can better protect their customers and themselves from financial losses. 

ALTA Efforts

In November, the FBI released a report that summaries its efforts to combat business email compromise (BEC) scams and real estate wire fraud by working with partners to identify perpetrators and dismantle their organizations. The report was also spurred by ALTA’s efforts the past two years to get language included in various House and Senate appropriations reports directing respective agencies to report on efforts to combat and raise awareness of BEC and wire fraud, and collaborate with industry partners to address threats.

Best Practices

Earlier this year, ALTA released a revision to its Best Practices. Included in the update, were changes to the use of wire verification services and use of manual or electronic methods for daily reconciliation, and specific action of identification and investigation of discrepancies, as well as revisions to protecting non-public information.

Education Resources


Report: $1.4B in Suspected Wire Fraud Identified by CertifID in 2022

Certifid wire fraud report
Source: CertifID

CertifID identified $1.4 billion in suspected wire fraud attempts during 2022, according to a report released by the wire fraud protection firm.

The report shows an 145% year-over-year increase in instances of reported wire fraud. The report, which is based on proprietary data from CertifID’s wire fraud protection and recovery tools and services engagements, examines over $100 billion in wire transactions. 

According to the report, wire transactions are increasingly at risk with suspected fraud targeting 83% of CertifID’s customers at least once in 2022. The heightened risk corresponds with an overall shift toward digital payments, accelerated by the COVID-19 pandemic.  

CertifID, which safeguards wire transactions by verifying identity, bank account and biometric information alongside 150 different markers of fraud, developed the State of Wire Fraud to report on the trends and trajectory of wire fraud.

Additionally, the report showed that CertifID’s recovery cases average $165,000 per instance of reported wire fraud in 2022

“Given their instantaneous speed, high dollar value and recovery challenges, wire transactions are extremely attractive targets for fraud operators. In our experience with the real estate industry, protections against wire fraud have had to evolve,” said Tyler Adams, co-founder and CEO of CertifID. “To combat wire fraud, businesses and consumers that rely on wire for sending and receiving payments need to employ a multi-layered protection and response plan to minimize their risk.” 

Revisions to ALTA’s Title and Settlement Company Best Practices attempts to improve security sending wire transfers. Pillar 2, which addresses escrow accounts, was updated to specify that wire transfer procedures should include multi-factor authentication and follow ALTA’s published guidance. The procedures also were updated to recommend the use of wire verification services:

  • If available, efficient, and economical, make use of wire transfer verification service providers. Such service providers should be vetted to understand any risk of use, security protocols, and the providers’ protection of Consumer data.

“We’ve made huge strides in awareness on wire fraud,” said ALTA CEO Diane Tomb. “Now, in addition to providing resources and education, we’ve codified the use of wire verification services as an industry best practice.”

ALTA Wire Fraud Resources

  • ALTA Outgoing Wire Preparation ChecklistUse this checklist as a best practice for verifying outgoing wire information.
  • ALTA Rapid Response Plan for Wire Fraud Incidents: Use this tool to customize your action plan when a wire fraud attempt occurs.
  • Video: How To Complete an IC3 Report. Watch the video to see how easy it is to help law enforcement gather information.
  • ALTA Cybersecurity Incident Response PlanUse this tool to help your team to establish and maintain secure systems and be prepared to act quickly if an incident occurs. Leverage these resources to implement Step 1: Preparation: 
    • *NEW for 2023* ALTA Cyber System OverviewUse this narrative to improve your understanding of a Cyber System Inventory, why it is important to Cybersecurity efforts, and how to create and maintain your company's inventory.
    • *NEW for 2023* ALTA Cyber System Inventory WorkbookUse this model workbook to create and customize your company's inventory.
    • *NEW for 2023* ALTA Business Impact AnalysisUse this guide to examine your software applications, determine which resources are critical to your operation, and discover when to add resources to minimize the business impact of downtime.
  • Wire Fraud Tips VideoShare this 1-minute video with homebuyers so they know how to protect their money.
  • ALTA Wire Fraud Video: This 2-minute video provides four tips on how consumers can protect their money and offers advice on what to do if they have been targeted by a scam. Link to this video from your website, include in your email or share on social media.
  • ALTA Wire Fraud Infographic: ALTA has produced this Rack Card explaining Wire Fraud. ALTA Members can brand the infographic with their own information at the ALTAprints website.

Share this video with your customers:



Share Your Stories: Affordable Housing Initiatives

Poster20230217_160805We recently asked members to share any affordable housing initiatives that companies are already involved in or may have planned. Brenda Silveus of Arizona-based Pioneer Title shared an initiative that her company promotes and supports. 

In her state, the Northern Arizona Housing Fund awards grants $25,000 grants for specific housing-related opportunities. She said Pioneer Title provides information to its customers about the housing fund and makes it easy for donations to be made at the close of a purchase, sale or refinance transaction. Pioneer then matches any donation. The title company educates Realtors and lenders with presentations to their team members and provide written information to their buyer and seller customers. Posters adorn Pioneer Title’s lobbies, encouraging donations through the escrow process.   Silveus said the program is in its infancy, but has done very well and the company is extremely proud to be a cheerleader for affordable housing. 

We love to hear examples like this and want to highlight other efforts as well. Even if it’s a closing fee discount to first-time homebuyers, we want to know! Share your initiatives at [email protected].


Most ALTA Members Not Covered by CFPB Proposal for Consumer Contracts

The Consumer Financial Protection Bureau (CFPB) on Jan. 11 announced a proposed rule that would create a registry of certain contract terms and conditions. This proposal would require certain nonbanks to annually submit information when their standard contracts impose limitations on consumer rights, including waivers of legal claims, choice of venue clauses, limitations on class actions, arbitration agreements and other legal waivers.

Fortunately, ALTA’s analysis is that this proposal will not likely require title companies to file anything with the CPFB.

Under the proposal, companies that must submit contracts are “supervised registrants,” which are a subset of “supervised nonbanks” as defined in the proposed definitions. It is unlikely that an ALTA member will qualify as a supervised registrant or nonbank as the proposal is drafted.

A starting point for this analysis is the definitions. The definition of a supervised nonbank there are four parts to examine. Critical parts of the definition are highlighted below.

    (g) Supervised nonbank means a nonbank covered person that is subject to supervision and examination by the Bureau pursuant to 12 U.S.C. 5514(a), except to the extent that     such person engages in conduct or functions that are excluded from the supervisory authority of the Bureau pursuant to 12 U.S.C. 5517 or 12 U.S.C. 5519.  Subject to the foregoing     statutory exclusions, this term includes any nonbank covered person that:

    (1) Offers or provides a residential mortgage-related product or service as described in 12 U.S.C. 5514(a)(1)(A); (2) Offers or provides any private educational consumer loan as     described in 12 U.S.C. 5514(a)(1)(D); (3) Offers or provides any consumer payday loan as described in 12 U.S.C. 5514(a)(1)(E); (4) Is a larger participant in any market as     defined by rule in part 1090 pursuant to 12 U.S.C. 5514(a)(1)(B); or (5) Is subject to an order issued by the Bureau pursuant to 12 U.S.C. 5514(a)(1)(C).

Analysis of Definition

The definition of covered person is foundational to any question about whether the CFPB can supervise a business. ALTA’s analysis starts with whether a provider of a service is a covered person under 12 U.S. Code § 5481(6). This definition applies to any person that offers or provides a “consumer financial product or service.” While definitions in the Consumer Financial Protection Act (CFPA) can get circular, in essence a consumer financial product or service under paragraph 5 of 5481 is a financial product or service as defined under paragraph 15 of the same section used primarily for consumer purposes.

It’s important to note two things when examining the definition of financial product of service under 12 USC 5481(15). First, 15(a)(iii) explicitly states that real estate settlement services are a financial product. This is where the CFPB gets the general power to oversee ALTA members and partially where the bureau draws its TILA-RESPA Integrated Disclosure (TRID) authority. However, it should be noted that this authority under 15(a)(iiI) also says that real estate settlement services are only covered to the extent they are not excluded under subparagraph C of the definitions. Subparagraph C says that the business of insurance (broadly defined in paragraph 3) is not within CFPB’s authority. Thus, a provider is not a covered person under the CFPA when the provision of real estate settlement services falls under the business of insurance. Put another way, since most contracts that title professionals use with customers are part of the insurance transaction, either because they are part of the insurance contract or because the service is overseen by the state department of insurance, they will likely not fall under the ambit of this proposal.

However, since there is some level of ALTA members and services that don’t fall into the business of insurance exception, there could still be some coverage for a portion of the business around settlement and escrow that is not explicitly part of the provision of insurance and supervised by insurance regulators. This would likely apply to entities like escrow companies that have separate escrow rules and regulations beyond the state DOI. In these instances, the other highlighted exclusions come into play.

In the definition above, a covered person only falls under this rule if they are subject to supervision under 5514(a). This section only applies to nonbank mortgage lenders or “larger participants” in other financial products. In general, for the CFPB to supervise a settlement company, it would need to issue a rule before supervising larger participants. ALTA is not aware of the bureau doing so in a manner that covers any title company. In addition, 5517(f) limits the CFPB’s authority to supervise people regulated by a state DOI.

Key Takeaway

While any new effort by the CFPB to push the envelope when it comes to regulation and supervision is concerning, most ALTA members should be excluded from this proposal as they are not covered persons.


ALTA Welcomes New Members

ALTA is pleased to announce new and associate members, as well as real estate attorneys, who have recently joined ALTA. Over the past month, ALTA gained 106 new members, including 56 title agencies and 37 real estate attorneys. ALTA had a record 6,510 member companies in 2022. Not a member? Click here to join today. You can check out member benefits here.

Membership Map

Membership map 2023



ALTA Decertifies Several 2006 Policy Forms

In line with prior guidance, ALTA decertified certain 2006 series policy forms effective Dec. 31, 2022.  

As always, ALTA decertification establishes that the association no longer officially supports the forms, and will not update them. However, use of these forms by Policy Form Licensees (including title insurers and agents) will likely continue for some period of time. Decertification does not prohibit the continued use of any form. In addition, realizing that these forms will be seen in the market, ALTA will continue to make them available on the ALTA website in a “Decertified Basic Policies (12-31-2022) – 2006 Series” subsection of the policy forms page through at least the end of 2023.

The specific decertified policy forms include: 

  • ALTA Loan Policy – 6/17/2006
  • ALTA Owner’s Policy – 6/17/2006
  • ALTA ECRLP – AP – 4/2/15
  • ALTA ECRLP – CA – 4/2/15
  • ALTA Homeowner’s Policy – 12/2/13
  • ALTA Residential Limited Coverage Junior Loan Policy – 8/1/12
  • ALTA Residential Limited Coverage Mortgage Modification Policy – 12/1/14
  • ALTA Short Form Expanded Coverage Residential Loan Policy - Assessments Priority -04-02-2015
  • ALTA Short Form Expanded Coverage Residential Loan Policy - Current Assessments - 04-02-2015
  • ALTA Short Form Residential Limited Coverage Junior Loan Policy - 04-02-2013
  • ALTA Short Form Residential Loan Policy - 12-03-2012
  • ALTA Short Form Residential Loan Policy - Current Violations - 04-02-2015
  • ALTA Commitment for Title Insurance – 08-02-2016
  • ALTA Short Form Commitment for an ALTA Short Form Residential Loan Policy – 12-01-2017

Specific 2006 Policy Forms that are NOT being decertified at this time include:

  • ALTA Limited Pre-Foreclosure Policy – 12/3/12
  • ALTA Limited Pre-Foreclosure Policy – Date Down Endorsement – 12/3/12
  • ALTA U.S. Policy Form – 12/3/12

At a future date, Endorsements that are specific only to the 2006-series Policy Forms will be decertified, and Endorsements that are applicable to both 2006-series and 2021-series Policy Forms will be migrated to 2021 heading standards so the application to the 2021 forms will be obvious. The dates for these actions have not been established. 

For any questions about which forms apply to which policy form series, please see the attached “Endorsement Chart v 2.0 05-12-2022”, which is posted to the ALTA Policy Forms site and updated as needed.

Technical Corrections

Two technical corrections were issued Dec. 31, 2022, to existing policies, along with notice of one policy’s version control heading correction that does not require a technical correction since no substance of the Endorsement is being revised.

  • Technical Correction to “Expanded Coverage Residential Loan Policy – Current Assessments”: Change the reference in Covered Risk 28.g. to reference the name of ALTA Endorsement 9.10 as follows:

Policy form 1

  • Technical Correction to “Short Form Residential Loan Policy – Current Assessments”: In the Addendum to the Policy, add “ALTA” before the name of the Policy that the Addendum applies to:

Policy form 2


  • Version Control Header Format Change – “Short Form Residential Loan Policy – Assessments Priority”: Modified the prior 11-18-2021 technical correction versioning date to match the 2021 style from the ALTA Forms Style Guide. This does not represent a technical correction, as no substance is being changed in the policy:

Policy form 3

Policy forms, including technical corrections, are available here.


How to Download Membership, Policy Forms License Certificates

ALTA members and policy forms licensee holders can now download their licenses online. Once logged in, primary and secondary contacts can download certificates for their branch offices HERE.

Membership Certificates

Membership cert

  1. Click the Download Here button.
  2. On the next page, click Download This Certificate and it will automatically download.
  3. If you would like to download the certificates for your subsidiaries, click View Children. Here, your subsidiaries will be listed and you can choose which certificate you would like to download.


Policy Forms License Certificates

Policy forms cert

  1. Scroll down until you see License Requirements for Agents who are Not Members.
  2. Click the Download Here button.
  3. On the next page, click Download This Certificate and it will automatically download.
  4. If you would like to download the certificates for your subsidiaries, click View Children. Here, your subsidiaries will be listed and you may choose which certificate you would like to download.