North Carolina General Statutes 45A-8. Embezzlement of closing funds by settlement agent
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Terms Used In North Carolina General Statutes 45A-8
- Closing: means the time agreed upon by the purchaser, seller, and lender (if applicable), when the execution and delivery of the documents necessary to consummate the transaction contemplated by the parties to the contract occurs, and includes a loan closing. See North Carolina General Statutes 45A-3
- Closing funds: means the gross or net proceeds of the real estate transaction, including any loan funds, to be disbursed by the settlement agent as part of the disbursement of settlement proceeds on behalf of the parties. See North Carolina General Statutes 45A-3
- Disbursement of settlement proceeds: means the payment of all closing funds from the transaction by the settlement agent to the persons or entities entitled to that payment. See North Carolina General Statutes 45A-3
- Embezzlement: In most states, embezzlement is defined as theft/larceny of assets (money or property) by a person in a position of trust or responsibility over those assets. Embezzlement typically occurs in the employment and corporate settings. Source: OCC
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Fiduciary: A trustee, executor, or administrator.
- parties: means the seller, purchaser, borrower, lender, and settlement agent, as applicable to the subject transaction. See North Carolina General Statutes 45A-3
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- Settlement: means the time when the settlement agent has received the duly executed deed, deed of trust or mortgage, and other loan documents and funds required to carry out the terms of the contracts between the parties. See North Carolina General Statutes 45A-3
- Settlement agent: means the person or persons responsible for conducting the settlement and disbursement of the settlement proceeds, and includes any individual, corporation, partnership, or other entity conducting the settlement and disbursement of the closing funds. See North Carolina General Statutes 45A-3
(a) All closing funds received by a settlement agent are trust or escrow funds received by the settlement agent in a fiduciary capacity.
(b) A settlement agent in the disbursement of settlement proceeds shall account for and pay the closing funds to the parties or entities identified for payment of the closing funds pursuant to the settlement agreement approved by the parties to the transaction.
(c) Except as to such portions of the closing funds representing the settlement agent’s fees and expenses, a settlement agent shall be subject to the embezzlement provisions of N.C. Gen. Stat. § 14-90 (2009-348, s. 2.)