Business ProfileforCapital Escrow Inc.

The following describes a pending government action that has been formally brought by a government agency but has not yet been resolved. We are providing a summary of the government's allegations, which have not yet been proven.

BEFORE THE DEPARTMENT OF BUSINESS OVERSIGHT
OF THE STATE OF CALIFORNIA
In the Matter of:
THE COMMISSIONER OF BUSINESS
OVERSIGHT,
Complainant,
v.
CAPITAL ESCROW INC.,
Respondent.

ESCROW LICENSE NOS.: 9632541,
96DBO-49449
ACCUSATION TO SUSPEND
ESCROW AGENT LICENSE PURSUANT TO
FINANCIAL CODE SECTION 17608
The Complainant, the Commissioner of the Department of Business Oversight
(Commissioner), alleges and charges Respondent Capital Escrow Inc. (Capital Escrow) as follows:
I.
Introduction
The Commissioner seeks to suspend Capital Escrow's escrow agent license pursuant to
Financial Code section 17608 for its repeated failures to meet the tangible net worth and liquid asset requirements of Financial Code section 17210 and pursuant to Financial Code section 17602.5 for failure to file a timely report to the Department of Business Oversight (DBO).
II.
Facts
1. Capital Escrow is an escrow agent licensed by the Commissioner pursuant to the
Escrow Law (Fin. Code, § 17000 et seq.) (Escrow Law).1
Capital Escrow has its principal place of
business located at 16250 Ventura Boulevard, Suite 115A, Encino, California 91436, and a branch office at 1000 Town Center Drive, Third Floor #300-48, Oxnard, California 93036.
2. The Commissioner licenses and regulates the activities of escrow agents.
3. Section 17210 requires all escrow agent licensees to maintain a tangible net worth of
at least $50,000.00 for their main office and at least $25,000.00 more for an additional branch office.
4. Capital Escrow's combined tangible net worth requirement is $75,000, because it
operates a main office and a branch office.
5. Section 17210 also requires all escrow agent licensees to maintain liquid assets of at
least $25,000.00.
6. Pursuant to section 17602.5, licensed escrow agents must make any reports required
by law or by the commissioner within 10 days from the date designated for making of such reports.
7. On March 6, 2017, the DBO commenced a regulatory examination of Capital Escrow.
8. During the examination, the DBO's review of Capital Escrow's February 2017
financial statements found that Capital Escrow's tangible net worth was $9,865.74 short of the $75,000 requirement and its liquid assets were $16,822.39 short of the $25,000 requirement, in violation of Section 17210.
9. On March 30, 2017, the DBO sent a letter directing Capital Escrow to submit proof
that it had corrected the above-described deficiencies by April 29, 2017. Capital Escrow received the letter by certified mail on April 3, 2017.
10. Capital Escrow failed to submit proof that it had corrected the deficiencies by
April 29, 2017.
11. The March 30, 2017 letter informed Capital Escrow that if it failed to respond, the
DBO could move to suspend Capital Escrow's license.

1 All subsequent statutory references are to the Financial Code unless otherwise noted.

12. On June 8, 2017, Capital Escrow provided a deposit slip to the DBO indicating that it
had deposited $30,000.00 into its bank account to cure the deficiencies from its February 2017
financial statements. At the same time, Capital Escrow provided its May 2017 financial statements.
13. Capital Escrow's May 2017 financial statements indicated that Capital Escrow was
$18,239.08 short of the $75,000 tangible net worth requirement and $23,536.68 short of the $25,000 liquid asset requirement, in continued violation of Section 17210.
14. Capital Escrow later provided its June 2017 financial statements to the DBO showing
that its $30,000.00 deposit had corrected its tangible net worth and liquid asset deficiencies.
15. At the direction of the DBO, Capital Escrow later provided its July 2017 and August
2017 financial statements.
16. Capital Escrow's July 2017 financial statements indicated that Capital Escrow was
$17,536.29 short of the $75,000.00 tangible net worth requirement and $21,156.09 short of the
$25,000.00 liquid asset requirement.
17. Capital Escrow's August 2017 financial statements indicated that it had corrected its
net worth and liquid asset deficiencies.
III.
Authority to Suspend Capital Escrow's License
18. Section 17608 provides, in pertinent part, as follows: The commissioner may, after notice and a reasonable opportunity to be
heard, suspend or revoke any license if he finds that:
. . .
(b) The licensee has violated any provision of this division or any rule
made by the commissioner under and within the authority of this division.
19. Section 17602.5 provides that if an escrow agent fails to make a report within 10 days
of the date designated by the Commissioner, "such failure shall constitute grounds for the suspension or revocation of the license held by such escrow agent."
IV. Prayer
20. The Commissioner finds that, by reason of the foregoing, Capital Escrow Inc. has
violated section 17210 by repeatedly failing to meet its tangible net worth and liquid asset requirements, and has violated section 17602.5 by failing to file a timely report with the
Commissioner. These violations constitute grounds for suspension of Capital Escrow Inc.'s escrow agent's license.
WHEREFORE, IT IS PRAYED pursuant to section 17608, that the escrow agent's license of
Capital Escrow Inc. be suspended for a period of seven days.
Dated: February 2, 2018
San Francisco, California