statement that “Escrow services are not available to California or Texas residents.” All statements regarding services being unavailable to Texas residents had been removed, including from the website’s footer and registration page.
Respondents did not obtain a money transmission license in Texas or otherwise contact the Department before modifying the website and reconfiguring it to allow customer registrations and transactions for Texas residents. m. The Department issued a Notice of Hearing on January 30, 2015
As of February 18, 2015, the EscrowHill.com website had again been modified.
As of that date it contained a statement that “Escrow services are not available to Texas residents.” Additionally, the “Edit Profile” page of website no longer offered Texas as an option on the state province drop down list prior to November 2014
Escrow Hill completed four transactions for Texas residents totaling $415,500.
Because Escrow Hill complete d money transmissions for Texas residents without a license until at least November 2014, Escrow Hill was in violation of Texas Finance Code §151.302(a).
From approximately January 7 to February 18, 2015, the EscrowHill.com website allowed customer registrations for persons located in Texas, even though Respondents had not obtained a money transmission license in Texas as required.
Because Respondents permitted customer registrations for persons located in Texas without obtaining the required license, Respondents were in violation of The Commissioner finds that Respondents’ prior compliance history is unsatisfactory because Respondents modified the EscrowHill.com website to remove all statements regarding services being unavailable to Texas residents without obtaining the required transmission license.
Modifying the EscrowHill.com website in this manner was a violation of Order No. 2014 which specifically ordered Respondents to configure the website EscrowHill.com to refuse customer registration or transactions from persons located in Texas until such time as Respondents obtained the required license.
The Commissioner also finds that Respondents have not shown good faith in attempting to comply with Chapter 151.
Respondents have demonstrated willful disregard for the requirements of Chapter 151 by ignoring the Department’s requests and by first adding, then deliberately removing the language on the EscrowHill.com website that stated its services were not available to Texas residents.
Such language was added to the EscrowHill.com website on or about December 6, 2014, in direct response to the Department’s order to cease and desist activity.
The language was removed approximately one month later, on or before January 7, 2015. Respondents had numerous communications with the Department’s Assistant General Counsel Brenna McGee concerning this matter.
Respondents are under a cease and desist order and aware of licensing requirements. Respondents did not apply for a license or otherwise directly inquire with the Department about removing the newly added language and soliciting and accepting Texas resident transactions prior to making the new modifications to EscrowHill.com.
Moreover, in addition to the removal of some language, Respondents took the affirmative step of adding a new section to the “Edit Profile” page where customers had to select their state of residence so as to direct their transactions to escrow agents compliant to their locations. This additional section made clear that Respondents’ escrow services were available to Texas residents through “an escrow agent compliant to your location.
Based on these findings the Commissioner finds that a penalty of $30,000 is appropriate.
Respondent agrees to the terms of this Order solely for the purpose of this proceeding, and without admitting or denying any violations of law or regulations pursuant to Texas Government Code § 2001.056 and Texas Finance Code § 151.706 ORDER It is hereby ORDERED, ADJUDGED and DECREED that:
Respondents shall not engage in activities in violation of Texas Finance Code Chapter 151, including advertising to and soliciting persons in Texas, whether conducted through Respondents’ activities or through those of others,and shall take all actions necessary to comply with the requirements of Texas Finance Code Chapter 151.
Respondents shall configure the website EscrowHill.com to refuse customer registrations and transactions from persons located in Texas, and the website shall remain configured that way until such time as Respondents obtain the necessary license to conduct money
transmission in Texas. Respondents shall confirm to the Department in writing, within 10 days of the effective date of this Order, that the configurations have been completed.
Respondents will pay $30,000 to the Department as an administrative penalty under Texas Finance Code 151.707 for operating an unlicensed money transmission business in Texas and for violating Order No. 2014.
The entire penalty shall be payable to the Department within 10 days of the effective date of this Order.
All the provisions of the Order to Cease and Desist Activity, No. 2014 are still in effect except to the extent that they conflict with this Order.
This Order against Respondents is effective on the date signed by the Commissioner, and subject to its terms, Respondents may not appeal.
so many rules. impossible to do business in USA.
Yeah, that’s why so little business gets done here, only maybe $18 trillion a year or so.
They are no escrow.com and the egos they got.
I suggest cut your losses and you can’t fuck with escrow.com. They got the talent. Who is escrow hill anyways ?
Yeah but escrow.com is no longer as good as they where. I never used escrow hill, but was considering using them since escrow.com’s new parent company has a history of trying not to pay sellers of domains when the buyers do chargebacks on their Freemarket site after the domain was already transferred.
Hey Nick,
Stefan from Freemarket here. We have actually only had a few instances where buyers performed chargebacks on bought domains or websites. In all cases we’ve reimbursed the sellers in full.
In those cases though the sellers said you would not give them their money and tried to keep it until they got the Australian Police involved. They had to to through a lot and jump through hurdles for weeks until they got their money. As an escrow payment that charge-back responsibility was yours not the sellers. You never claimed it would not happen again, or claimed to change your policy. It seems like you want to have the seller lose the domain and their money if you can’t fight a a chargeback.
It’s not like escrow is really that complicated of a business it’s not like don’t fuck with Google’s algorithm thinking yours is better it’s escrow it’s nothing special or complicated. The major things just making sure that you keep up-to-date with the licensing so it’s more of an administrative thing.
That is what happens when you offer Escrow services without having obtained the appropriate license.
We have already talked about that a few months ago, when we also mentioned the case of the French company eCOP.
@GaryB: those rules are made to protect consumers, and getting a license is not “so many rules”. Many countries require a license to offer monetary or financial services.
I know many love “wild capitalism” (and the law of the jungle …), with no rules to protect all parties against frauds and abuses of all kind, where bad guys can do whatever they want without fear of being punished, but rules are the essential part of a fair and balanced concept of society.
Appropriate rules are not against business, they are an essential part of business.
Most states in the USA do not require an Escrow license. As a matter of fact, most states don’t even offer an Escrow license. New York is a prime example where there is no Escrow license to be obtained. Out of the 50 states, the only states I believe would be Texas and California.
What’s your answer to that?
Matt,
I never mentioned other US states, we are talking about Texas here.
Furthermore, there are other US states requiring a license to offer escrow services, including AZ, Tennessee, Georgia.
As regards Arizona, California, Idaho, Texas (after this case) and Washington, Escrow Hill partnered with a law firm, Greenberg & Lieberman.
We have already talked about this subject on DomainInvesting: http://www.domaininvesting.com/keep-some-funds-in-escrow/
Dealing with an escrow service which is not licensed, audited and insured is always a bad idea … unless you don’t care about the risk of losing all your money in case of bankruptcy, fraud, mismanagement, etc …
If other US states are not requesting to get a proper license to offer escrow service to the general public, it’s their (big) problem, and an evident lack of proper regulations to protect consumers against possible frauds, scams, etc, which are widespread in the financial and online world.
It’s also a question of good “old” common sense … but from what you are saying I guess you prefer the “law of the jungle” … lol
Yes you will still need a license. You’d need a money services license in those states. Escrow Hill isn’t operating lawfully and they paid the price. Why would you trust your money with these guys?
@ Andrea Paladini – A license requirement for everything has ruined America. Was a time a person could buy some hot dogs and some bread and set up a stand and make a living. Now government wants their cut under the guise of ‘protecting consumers’. Its all a lie as licenses have nothing to do with consumer protection and to think so is naievete. This is why USA is losing its edge globally as there are too many statist central planning phiolospher kings imagining they can devise an economy. Sad. America used to be a great country for capitalism.
I said “appropriate rules”, some rules are fair and balanced, and properly applied, others are not, same is true for licenses, also here in Europe.
You can’t mix totally different things, here we are talking about Escrow, which means monetary and financial services.
And consumer protection in financial (and online) services are very needed, with all fraudsters, scammers, banksters, etc around … I’ve been working for many years in the financial industry so I know what I’m talking about.
“Now government wants their cut under the guise of ‘protecting consumers’”
When I was young, the gov’t was constantly arresting people for running numbers, operating lotteries, having slot machines and poker games in the back room of bars & restaurants, etc.
They said they were protecting U.S. citizens from organized crime.
Today, gov’t controlled/licensed casinos are everywhere. The funny thing is, the payout for players of electronic slot machines is terrible compared to when it was a mechanical slot machine in the backroom.
And, my state makes a fortune from lottery operations. It is almost pure profit. Plus, the state publishes an annual report boasting of its excessive profit.
it is all about the gov’t getting their cut just like the old crime bosses wanting a piece of the action.
Sorry but why would anyone use anything but escrow.com? It’s like registering the .net when the .com is available and for the same price.
Big blow to them. Break laws and this is what you get.
That’s why escrow.com cares about customers and buyers. I wouldn’t trust escrow hill with my transactions. Tbey are a back room shop shop.
Anyone who think’s Freelancer, (Escrow.com’s new owner) cares about their customers , hasn’t done their research.
I’ve never done business with EscrowHill.com, but Andee Hill was great to do business with when she was at Escrow.com. I hope they’re able to get everything sorted. Competition is good in this space.
Escrow.com is a failing company that now belongs to a shady Australian company running freelancer.com
Nice one, Escrow Hill sock puppet!
I love Texas, but some of the new restrictions and red tape are getting ridiculous. As a Texas resident (Currently) this makes me sad :/
Eric,
As a respected member of the community, it appears you’ve completely missed the point.
As I understand it, Escrow.hill was under a cease and desist that they ignored, or at the very least, attempted to evade. As much as I detest government red-tape, I don’t mind it when someone else is handling my $.
APRE
Eric I would agree
Banks, brokers, escrow companies are not like hot dog carts like Gary suggests.
I’m a big “no government in business guy,” but sometimes they do have to be involved.
Holding other people’s money is one of those times
Hard times for escrowhill after 2 employees are no longer with the company!
Poached employees should never be trusted since simply by being poached they’ve shown they lack integrity and loyalty.
Wait there’s a lack of integrity and loyalty if you want to go start your own shop do you realize how many people leave Google Facebook whatever to go start their own start up AndeeHill was supposed to work at escrow dot com for life is that what you’re saying ?
A license for a financial service provider is not strange. It helps to regulate the industry.