(a) In any real estate transaction in which any person is entrusted, receives, and accepts, or otherwise holds or deposits monies or other trust instruments, of whatever kind or nature, pending consummation or termination of the transaction involved, whether or not the person is required to be licensed under this subchapter, the monies, in the absence of written instructions to the contrary signed by all parties to the transaction, shall be:
(1) Deposited within 7 days in an account in a financial institution located within the District whose deposits are insured either by the Federal Deposit Insurance Corporation or the Federal Savings and Loan Insurance Corporation, or their successors;
(2) Maintained by the escrow holder or trustee as a separate account for monies belonging to others; and
(3)(A) Retained in an account until the transaction involved is consummated or terminated, or until proper written instructions have been received by the escrow holder or trustee directing the withdrawal and disposition of the monies, at which time, all the monies shall be promptly and fully accounted for by the escrow holder or trustee. In no event shall any escrow holder or trustee commingle any of the monies with his or her own funds or use any of the monies for any purpose other than the purpose for which the monies were entrusted to him or her.
(B) The escrow holder or trustee may keep a nominal amount of his or her personal funds in an escrow or trustee account for the purpose of keeping active the escrow or trustee account.
(b)(1) Each escrow holder or trustee shall notify the Commission within 14 calendar days of the name and post office address of the financial institution in which an escrow or trust account has been established and also the name and number of the account.
(2) All escrow holders or trustees shall notify the Commission of all escrow in trust accounts existing on March 10, 1983, and within 30 calendar days after March 10, 1983.
(c) Each escrow holder or trustee shall give written authorization to the Commission to examine escrow or trust accounts maintained by him or her and shall permit the Commission to examine all books, records, and contracts relating to the escrow accounts. The examinations shall be made at any time the Commission may direct.
(d) An escrow holder or trustee shall not be entitled to any part of the earnest money or other money paid to, or held by, the escrow holder or trustee in connection with any real estate or business transaction as a part or all of his or her commission or fee or for any other purpose until the transaction has been consummated or terminated.
(e) If an escrow or trust is held for 90 days or more, it shall earn interest from the 91st day to the date the transaction is consummated or terminated, at the highest of the following interest rates:
(1) The legal maximum rate under federal law for interest on ordinary savings deposits in commercial banks;
(2) The rate on the account in which the escrow is deposited; or
(3) The rate on the certificate of deposit or other security given as the escrow or trust.
(f) A service fee of not more than $15 may be subtracted from the interest by the financial institution into which the escrow or trust funds are deposited.
(g) Nothing in this section shall be interpreted to supercede the Security Deposit Act (D.C. Law 1-48; 22 DCR 2825).
1981 Ed., § 45-1937.
References in Text
The Federal Savings and Loan Insurance Corporation, referred to in (a)(1), has been abolished. For provisions relating to the abolition of the Federal Savings and Loan Insurance Corporation and the transfer of functions, personnel and property of that agency, see §§ 401 to 406 of Pub. L. 101-73, set out as a note under 12 U.S.C. § 1437.