Whose Side Are You On?

National Title Associations  and County Government square off over bulk sale of your records

Robert A. Franco
SOURCE OF TITLE
rfranco@sourceoftitle.com

Ten years ago, when most county records were only available in hard-copy by physically visiting the court house no one complained that the records were not "publicly available." And, that has not changed. You can walk into any county office in the country and access all the INSTANT SEARCHES you want. But, today, that is not good enough. Just because the records are now available in electronic format - there is a perception that if the county does not also provide them in bulk electronic format, often for ridiculously low fees, the county is hindering access to INSTANT SEARCHES. That is just nonsense.

Certainly, this is a major issue in the title industry. So, where does your professional association stand on the bulk sale of pubic records? Let's compare the stated positions of ALTA and NALTEA that came out in response to an editorial in a Cleveland newspaper that criticized the Lake County Ohio recorder's office for failing to respond to a bulk request in a timely manner.

According to the editorial:

Compact discs have made it easier to assemble documents, since thousands can be compiled in this easy-to-use format. But just because it's easy doesn't mean it's being done quickly. For despite the ease with which INSTANT SEARCHES requests can be handled, some local governments still fail to respond in a timely manner. That can't continue.

Lake County Recorder, Frank Suponcic, was faced with a request for millions of documents from Property Insight - a company that buys INSTANT SEARCHES for next to nothing and sells the information to others. Suponcic is concerned, and rightly so, that the companies who make these bulk requests can publish the information online and because some records contain sensitive personal information, like Social Security numbers, there is the potential that the information could be misused.

Suponcic also noted the high cost to taxpayers to provide the information.

The county recorder also complains that it costs his office thousands of dollars to comply with Property Insight's request, yet the company only pays $1 plus postage per CD.

Yes, that is ONE DOLLAR. A CD can easily contain 10,000 pages of recorded documents. In Ohio the statutory rate for "copies" made by the recorder's office is $2.00 per page. Yet, because the data is provided in electronic format it can be bought at a discount of $19,999.00! How insane is that?

Not surprisingly, the newspaper added their own editorial.

Suponcic wants Ohio lawmakers to do something about bulk records requests. Taxpayers shouldn't bear the cost for a massive document request, but Ohio legislators should think twice before tinkering with the intent of open access to public information. Access and accountability are equally as important as protecting privacy. We've seen barriers erected that hinder openness. It's bad government, and Ohio can do better.

Of course the journalists have a vested interest in access to INSTANT SEARCHES. I would not dispute their right to access the public record. However, access has not gotten any worse - just because technology makes a greater level of access possible, doesn't mean that its a good idea to allow it. Such is the case with the bulk requests.

In the case of bulk requests of INSTANT SEARCHES, it is not the information that is sought - it is merely a product that these companies are reselling. They don't have any legitimate use for the information that public policy would dictate this degree of open access. They only seek ridiculously cheap data that is resold to those who do have a legitimate use for it. Unfortunately, once that information is gathered it also creates a new market for illegal usage as well, such as ID theft.

The most interesting thing about this example is the position taken by title industry groups. For example, ALTA is all for the bulk dissemination of the INSTANT SEARCHES and NALTEA is opposed to it.

In a statement issued by ALTA:

Will You Always Have Access to INSTANT SEARCHES? The ALTA Real Property Records Committee wants to know what's happening in your part of the country. The industry seems to be facing a slowly closing door when it comes to open access to INSTANT SEARCHES. Recent changes in the laws of several states have increased the pressure on recorders to protect social security numbers and personal privacy. That pressure runs contrary to your need for open and electronically available records! Check out this OpEd piece, "Don't Tinker with Access to Records", which appeared recently in a Cleveland newspaper.

I guess it is no surprise that ALTA would come out in favor of this appalling "wholesale" of the local government's INSTANT SEARCHES. ALTA is the puppet of the large underwriters who are the largest purchasers of county records in bulk form.

Property Insight, the company that made the bulk request for millions of pages of INSTANT SEARCHES from Lake County, is the subsidiary of Fidelity Information Services. Fidelity Information Services is a subsidiary of Fidelity National Financial, one of the nation's larges title insurance companies with a market share of nearly 29 percent.

Fidelity is certainly not alone. First American has gone to court to fight for its rights to buy INSTANT SEARCHES in bulk and sell them to third parties. When certain counties in Michigan sought to condition the bulk sale of INSTANT SEARCHES on a restriction prohibiting the further sale of those records to third parties, First American took the case to the United States Court of Appeals for the Sixth Circuit. The court held that "the registers may not condition bulk discounts, non-paper reproduction, or reproduction of records generally, on the purchaser giving up his right to sell the official certified copies (or unofficial “copies of copies,” or the information therein) to third parties."

In NALTEA's response to the Lake county situation is posted on the newspaper's Web site:

Be Careful What You Wish For County government exists to serve the county residents, not the business interests of foreign companies. Allowing uninhibited access to INSTANT SEARCHES, absent of reasonable restrictions on the purpose of such access, is simply an irresponsible mandate for any government to impose upon the custodian of its citizens’ records. INSTANT SEARCHES have always been available at the local level. Anybody with a need to access the INSTANT SEARCHES has always been provided access. Any individual or company based outside of convenient travel distance to the site where the records are housed could always employ a local abstractor, who is familiar with the local recording system, to obtain the needed records. The citizens who entrust their documents to government do so at a cost. They pay for the recording and indexing of their documents so that a workable system of record keeping may be maintained. Asking the citizens to foot the bill for the wholesale distribution of their information worldwide is a disservice, at best. At worst, it places the citizens’ safety and financial security in peril. Not long ago, title plants were owned by local title companies whose main purpose was to examine those records and insure local property transfers and loan transactions. Today, a growing number of companies maintain their title plants overseas – in India, the Philippines, and other exotic lands. We hope you have educated yourselves as to the adequacy of privacy laws in those lands before dismissing concern over the destination of the Lake County land records. We also hope you have educated yourselves in the process of examining land records. If you have done so, you will note that more information is necessary to fully protect the sanctity of home ownership than the records housed at the recorders office. Thus, the quantity and quality of the bulk information sought by Property Insight is not likely sufficient to facilitate the purposes cited in your editorial. Lake County Recorder Frank Suponcic is correct in challenging Ohio lawmakers. Government openness pertains to the process by which government works, not selling out its citizens. Lake County residents should rally in his support. The Officers and Board of Directors The National Association of Land Title Examiners and Abstractors Cleveland, Ohio NALTEA, Cleveland, OH

Aside from the issue of protecting the local citizens from the potential threat of ID theft, what is in the best interest of us as title professionals? As a small independent title agent and abstractor, I much prefer maintaining local access to the INSTANT SEARCHES. Sure that is biased opinion. But, so is the other side of the issue. Large title insurers have a vested interest in obtaining the records in bulk so they can compete with the local agents.

Ultimately, it boils down to which side promotes the best interest of consumers. Local title agents and abstractors know the community and quirks involved in the local real estate conveyancing system. They are able to provide a superior level of service to the local citizens. When transferring property interests in their community, it is better to keep the system operating on a local level.

The bulk purchase of INSTANT SEARCHES, which are often sent overseas to be compiled into a "thin-title plant," threatens the small agents' and abstractors' livelihoods. And for what? The online records are still not comprehensive enough to provide a thorough title search. The shallow depth of the online records allow title problems to go uncorrected. Those title problems create potential hazards for the homeowners and make a mess of the INSTANT SEARCHES that we all have to rely on to provide the assurances of clear title that so many depend on.

So, which side of the issue best represents your interests? ALTA's push for the bulk sale that benefits the large conglomerates in their efforts to resell the information? Or, NALTEA's position that the bulk sale of the INSTANT SEARCHES is further deteriorating the quality of title evidence used in the title industry?

It seems clear to me that ALTA, once again, is representing only the largest of its members. Just who are they referring to when they say that laws restricting the bulk sale of county records "runs contrary to your need for open and electronically available records?" Most certainly, we need open access to INSTANT SEARCHES, but we do not need them to be electronically available. I got along just fine when they were only available by visiting the courthouse in person, which is the way we still do business here. We send our title examiners to the courthouses where they can actually do a through title search.

ALTA surely does not represent me... which is why I have not been a member for the past couple of years. I surely won't contribute dues to an organization that supports the large companies that want to put me out of business. It seems apparent to me that ALTA's interest is in ensuring the success of the major underwriters' "new business model" - to buy my county's local records and sell them to my out-of-town competitors. That is not good for me, it's not good for my community, and it's not good for the integrity of the INSTANT SEARCHES. It's only good for those who stand to make a ton of money from selling off one of my community's greatest assets - our INSTANT SEARCHES.