If you thought title companies would lay low at last week’s REBNY gala in light of strict new rules governing their expense accounts, you weren’t alone.
But after a last-minute stay that put off the rules until Feb. 1, the industry’s top players were out in force at real estate’s biggest party of the year. A bill that would ease the regulations, which passed the state Senate on Jan. 16, furthered bolstered their cause.
“I feel like I’m out of jail,” said one agent, who like many others requested anonymity. Despite admitting the industry needs to be cleaned up, the agent said the original rules were overreaching and “shackled everyone down.”
As written, the original regulations from the state’s Department of Financial Services ban title companies from offering meals, tickets and entertainment to clients as a way to secure business. The Senate bill — if passed into law — would ease those regulations by limiting the ban to marketing that’s offered as a specific quid pro quo.
Still, some revelers last week speculated that industry lobbyists convinced the DFS to delay the new regulations to accommodate the gala.
In a ballroom down the hall from the the main event, title agents and attorneys stood shoulder to shoulder at a packed reception hosted by AmTrust Title. A REBNY after-party at Nobu, hosted by Cohen Equities along with Royal Abstract, JLL, Citrin Cooperman and Alliance Building Services, was “at capacity” by 10 p.m. That didn’t stop a throng of hopefuls who stood shivering outside the restaurant, waiting to get in.
“There’s a certain amount of social amnesia going on,” said one title agent, who added that people are still confused about the scope of the new rules. “Does it mean, I can have a party but I have to have video screens up, like it’s a CLE [continuing legal education course]? We’re all looking for guidance. And everyone’s got their own ideas.”
Pierre Debbas, a real estate attorney and partner at Romer Debbas, LLP, said that though his contacts in the title industry are on the up-and-up, even they warned him last month that some social outings would stop. “Some companies are going to be Boy Scouts now,” he said.
For Marc Lawrence, founder and CEO of REIN NY, there’s a definite red line. “To give tickets is an inducement. To go with them is business,” he said.
Debbas said he thinks DFS — which requested itemized expense sheets from three firms last month — is probably looking to make an example out of a few players.
“Eventually, there will have to be some middle ground in the regs,” he said.