Question: We have a title company that wants to open an interest bearing "escrow" account for a subcontractor that they are acting as escrow agent pending completion of a government job by a subcontractor. They want to use the subcontractors tax ID number on the account, but the subcontractor will not be a signer. What is the appropriate way to title such an account?
Answer: Something like --
ABC Title Company, Escrow Agent
XYZ Construction Company
. . . if you can make sure the interest reporting will pick up the XYZ Construction Company name line and EIN.
If you have a "first line only" system, try:
Escrow for XYZ Construction Company
ABC Title Company, Agent
Just be certain that your staff understands the construction company cannot access the account without court order. You may need to put some kind of administrative block on the account (not for check clearing Reg. CC fans, for tellers) to make sure XYZ doesn't get to the money.
BankersOnline is a free service made possible by the generous support of our advertisers and sponsors. Advertisers and sponsors are not responsible for site content. Please help us keep BankersOnline FREE to all banking professionals. Support our advertisers and sponsors by clicking through to learn more about their products and services.