Update on the DS-1

Judge Grants Attorneys’ Title Guaranty Fund’s Preliminary Injunction, Delays Implementation of the New DS-1

As an update to yesterday’s message, Attorneys’ Title Guaranty Fund filed a lawsuit yesterday against the Illinois Department of Financial & Professional Regulation (read the complaint).

An emergency hearing occurred today on ATG’s motion for a preliminary injunction, to delay the July 1 implementation of the proposed new DS-1 form. The hearing was heard before Hon. Thomas R. Allen.

We are happy to report that Judge Allen granted ATG’s motion. As such, practitioners should continue to use the old DS-1 form until further notice.

Chief among IRELA’s concerns are whether IDFPR has the authority to compel lawyers to disclose their attorney fees at the onset of the transaction, and to generally cast in a negative light lawyers who function as both attorneys and title agents.

IRELA will continue to keep you updated as this case progresses.

ATG is taking a stand for lawyers by filing this lawsuit, and their efforts should be applauded.

Update on the DS-1

Attorneys’ Title Guaranty Fund Files Suit, Seeks TRO & Writ of Prohibition

As a quick update to the current status of the DS-1, four (4) members of Illinois Real Estate Lawyers Association’s board met on Tuesday with John Lartz and Bryan Tiller of the Illinois Department of Financial & Professional Regulation. Peter Birnbaum from Attorneys’ Title Guaranty Fund was instrumental in making this happen.

First and foremost, it is worth noting that the fourth version of the form is markedly better than the original. And IRELA has worked diligently to convey our concerns. But problems remain.

Chief among IRELA’s current concerns are whether IDFPR has the authority to compel lawyers to disclose their attorney fees at the onset of the transaction, and to cast attorneys in a negative light through their selected language (whether intended or not).

While both Mr. Lartz and Mr. Tiller were very cordial at Tuesday’s meeting and appeared to listen, there was no definitive decision from them as to whether any additional changes would be made to the current iteration of the form. There was also no indication as to whether there would be any further delays to implementation — irrespective of whether there were more changes (as of now, July 1 is still the date they have set).

Mindful that we are now just a few days away from July 1, ATG has taken the initiative to file a lawsuit in the Circuit Court of Cook County (Case No. 2018-CH-08133). The suit seeks an injunction, as well as a writ of prohibition. (You can read the complaint online by clicking here.) 

In the interim, the hearing on a temporary restraining order is scheduled for Friday, June 29 at 2:00pm.

A Win for All Lawyers in Illinois

The Judge in ISBA v. IDFPR Issues Order Against
“Unlicensed Appraisal of Real Estate” Prosecutions

As you know, the Illinois Real Estate Lawyers Association has been closely following the litigation that ensued after the Illinois Department Financial & Professional Regulation (IDFPR) instituted disciplinary proceedings against two lawyers who filed property tax appeals on behalf of their client but who did not use appraisals (in filing appeals, IDFPR alleged that the lawyers engaged in the “unlicensed appraisal of real estate”).

The prosecutions should have been concerning to all lawyers in our state, irrespective of whether they practice in the area of property tax — as it appeared to be an attempt to regulate lawyers who, in their ordinary course of representation, make arguments on behalf of clients.

The Illinois State Bar Association filed suit against IDFPR on July 11, 2017. The suit was brought in Cook County (2017-CH-09418) and has been most recently before Hon. Raymond W. Mitchell.

Earlier today, the judge in the case issued a very thoughtful order that includes:

The Court issues a writ of prohibition against Defendants preventing them from initiating, maintaining, or threatening a prosecution of an attorney licensed to practice in the State of Illinois for engaging in the submission of a comparison of properties or income approach valuation by a property tax attorney in a real estate tax assessment proceeding. (Count III).

The Department of Financial Institutions Has Delayed Implementation of the Revised DS-1 Form (Disclosure of Financial Interest) . . . Again!

The Illinois Real Estate Lawyers Association remains extremely concerned about the Division of Financial Institution’s release of a revised DS-1 form (a document which, on its face, is disparaging to attorneys who function as title agents; it would also be impossible to implement).

We received notice late today that the May 15 implementation date for the revised DS-1 form (released on April 3, 2018) has again been delayed — with a new date of June 1, 2018.

IRELA continues to take the position that the form should be revised before formal adoption. We will keep you updated in the coming days and weeks as events unfold.

In light of these developments, IRELA will hold three (3) special townhall meetings in May (throughout the Chicagoland area):

May 9: 12:00 to 1:30pm
Oak Lawn Public Library (9427 Raymond Ave., Oak Lawn)
More info: http://www.irela.org/2018/05/town-hall-on-may-9-2018-in-oak-lawn/

May 16: 12:00 to 1:30pm
DuPage County Bar Association (126 S. County Farm Rd., Wheaton)
More info: http://www.irela.org/2018/05/town-hall-on-may-16-2018-at-dcba/

May 23: 8:00 to 9:30am
Max & Benny’s (461 Waukegan Rd., Northbrook)
More info: http://www.irela.org/2018/05/town-hall-on-may-23-2018-in-northbrook/

All Illinois attorneys are encouraged to attend, irrespective of their IRELA membership status. Lunch will be provided to anyone who RSVPs in advance (send to: info@irela.org). MCLE Credit: 1.0 hours of credit will be provided.

IRELA will continue to monitor the situation and keep you informed of information as it develops.

4th Annual
CLINK Spring Toast

Celebrating Women Closing Deals in Heels
Commercial Real Estate | Real Estate Law

WHEN
Thursday, May 17, 2018
5:30-7:30pm

WHERE
The Ivy Room
12 E. Ohio St., Chicago, Illinois 60611

Click here to register online. IRELA member
will save $10 by entering the code: IRELA

The Department of Financial Institutions Has Delayed Implementation of the Revised DS-1 Form (Disclosure of Financial Interest)

The Department of Financial and Professional Regulation, Division of Financial Institutions announced today that it has delayed implementation of the new DS-1 Form (Disclosure of Financial Interest).

For now, the old DS-1 should be used, pending further direction from the Department.

IRELA will continue to monitor the situation and keep you informed of information as it develops.

Revision of the Disclosure of Financial Interest

The Department of Financial and Professional Regulation, Division of Financial
Institutions announced today that the Disclosure of Financial Interest form, also known as the DS-1 form, has been revised.

This revised disclosure form is effective immediately.

Disclosure of Financial Interest (Effective 04-04-2018) 

(04-03-2018) Memo on the Revision of the Disclosure of Financial Interest Form (DS-1)

Instructions on Completing the Disclosure of Financial Interest

National Association of Realtors (NAR)
SUMMARY: The Tax Cuts and Jobs Act – What it Means for
Homeowners and Real Estate Professionals

To access and download the NAR Summary of the Tax Cuts and Jobs Act, click on:

The Tax Cuts and Jobs Act – What it Means for Homeowners and Real Estate Professionals

For more information, call 312.600.7720, or email to info@irela.org or vokada@irela.org.

IRELA Update:

CFPB Director Richard Cordray Resigns
Who Will Lead the CFPB? — Cordray Designates Deputy Director
Leandra English As Successor

Cordray’s November 24th resignation letter was cordial, but clear.

Richard Cordray’s resignation letter to President Donald Trump touted the agency’s successes as a consumer watchdog and ended with a reference to his post-bureau path.

“I am grateful to have been able to serve my country in this capacity, and in departing I now look forward to finding further ways to continue to advocate for those who are facing economic anxiety and uncertainty in their lives.” pic.twitter.com/x4YNqsgJLN

— Rich Cordray (@RichCordrayOH) November 24, 2017

On Friday, November 24th, Cordray (CFPB) officially appointed Leandra English, the bureau’s chief of staff, to the agency’s number-two position of deputy director to serve as interim director until Congress confirms an appointee. By installing an official deputy, Cordray was making a calculated move.  A provision of the Dodd-Frank Act, the same act that created the CFPB, stipulates that the deputy director shall “serve as acting Director in the absence or unavailability of the Director.” Prior to Cordray’s move on Friday, the agency had only an acting deputy director.

Shortly after Cordray’s announcement on Friday, the White House named Office of Management and Budget Director Mick Mulvaney as the CFPB’s interim director, to serve in the post in addition to serving in his role as director of the White House Office of Management and Budget.

“Director Mulvaney will serve as acting director until a permanent director is nominated and confirmed,” the White House said in a statement Friday.

The two moves set up a clash over who will run the bureau pending Congressional confirmation of Cordray’s successor. The legal tension will likely be between the 1998 Federal Vacancies Act (a statute which generally empowers the president to fill vacancies on an interim basis unless some other mechanism is specifically authorized) and the 2010 Dodd-Frank Act which created the CFPB. The case for Cordray being able to designate his own successor under Dodd-Frank may be strengthened by the fact that the version of Dodd-Frank passed by the House had explicitly applied the Vacancies Act to the CFPB, but the conference committee stripped out that language.

Ultimately, the issue will likely have to be resolved in a court of law.

UPDATE: November 26, 2017 10:00 pm: CFPB Deputy Director Leandra English has filed suit in the United States District Court for the District of Columbia claiming that the 2010 Dodd-Frank specific succession provision controls over the provisions of the 1998 Vacancies Act.  The suit seeks injunctive relief allowing her to act as interim director until the case can be heard by a federal judge.

Richard Cordray, Director of the Consumer Financial Protection Bureau, testifies about Wells Fargo at a Senate Committee hearing in September, 2016.

House Republicans issued an Interim Majority Staff Report June 6, 2017 alleging that Richard Cordray, Director of the CFPB, failed to comply with a legal obligation to turn over all documents related to the Wells Fargo unauthorized accounts scandal.  The CFPB has responded that it has produced over 57,000 pages of materials already in response to the committee’s document requests, and stands ready to continue to cooperate with the committee staff to satisfy its oversight process.

The House Republicans staff report, entitled Was The “Cop on the Beat”?, was issued shortly before the recent passage by the House of Representatives of Jeb Hensarling’s Financial Choice Act, which, if passed by the Senate, would make major changes to the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Currently, CFPB Director Cordray can only be terminated for “inefficiency, neglect of duty or malfeasance in office”.  In alleging that the CFPB has failed to cooperate and that its Director should be held in Contempt of Congress, is the House setting the stage following Senate approval for termination of Cordray by the president at will?

To download and read the entire House Republican Staff Report, click on:

Was The “Cop On The Beat”? Report_2017-6-6_interim_cfpb_wells_fargo_report_final

The report concludes that, in light of the CFPB’s actions to date:

“Director Cordray is in default of the Committee’s Subpoena.  Without receipt of all records requested by the Committee from the CFPB, the Committee cannot complete its investigation into the Wells Fargo matter.  Accordingly, Committee Majority Staff recommend that the Chairman: (1) issue deposition subpoenas to CFPB  employees to investigate Director Cordray’s default; and (2) prepare to, if necessary, initiate contempt proceedings against Director Cordray unless the CFPB produces all responsive records.”