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In the Los Angeles County area 70% of all transactions are closed with independent escrow agents. Most independent escrow agents do not have the stringent controls in place that our in–house escrow operations do, such as our document execution guidelines or a minimum of ten (10) hours of training every two years. As a result, our title officers are trained to scrutinize the documents they receive in escrow for inaccuracies, as well as fraud and forgery.

A title only order opened in the Burbank, Calif. branch of Lawyers Title Company for a $273,000 second cash–out loan. The deed to the subject property reflected the original owners in title since 1980. The transaction closed with an independent escrow company and Terri Westfall, the title officer, received the documents that were to be recorded the very next day. The recording package included a deed from the original owners to a new individual, Artak B., a single man, and a deed of trust executed by the individual in the amount of $273,000.

The signatures on the deed looked suspicious to Terri because they were inconsistent with the signatures on documents in the chain of title. Terri noticed the documents were signed in the presence of the escrow officer. Terri asked the escrow officer for copies of the identification presented to her at the signing. She compared the identification to the names on the deed and quickly discovered these spelling errors:

Name on DeedName on Identification
Nellie KokikianNelli (missing e) Kokikin (missing a)
Vanouhi KokikianVanouhi Kokian (missing ki)
Name on DeedSignature on Deed
Nellie KokikianNelli (missing e) Kokikin (missing a)
Vanouhi KokikianVank (missing ouhi and entire last name)

In addition, Terri knew the property had been acquired by the actual owners in 1980, but the identification indicated Nellie was born in 1980 and Vanouhi was born in 1975 (which would have put them at zero and five years of age at the time of the initial property acquisition). Terri halted the transaction and notified the escrow agent that Lawyers Title Company would not be recording the documents, nor would they be insuring this transaction.

Terri then handed the documents over to her supervisor and he in turn posted the property address to the title plant records to warn other title insurers of the crime almost perpetrated on Lawyers Title Company.

For Terri's careful attention to details and her diligence in asking for supporting documentation that lead to her discovery of a forgery, she has been rewarded $1,000 and has received a letter of recognition on behalf of the Company.




Had Terri accepted the documents and recorded them without a careful review, the Company would have issued a loan policy to the new lender insuring 100% against forgery. When the borrower failed to repay the loan, the lender would likely start foreclosure against the unwitting property owners who never deeded over their property.

The end result would have been a claim against the Company by the owners for recording an erroneous lien against their property and a claim by the lender under their insurance policy for a complete forgery in the chain of title leading to a failure to foreclose under their deed of trust.

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