diff --git a/app/models/domain.rb b/app/models/domain.rb
index ed55360e2..f837ea14d 100644
--- a/app/models/domain.rb
+++ b/app/models/domain.rb
@@ -236,6 +236,8 @@ class Domain < ActiveRecord::Base
         transfer_from: registrar
       )
 
+      generate_auth_info
+
       self.registrar = params[:current_user].registrar
       save
     end
@@ -248,6 +250,8 @@ class Domain < ActiveRecord::Base
       transferred_at: Time.zone.now
     )
 
+    generate_auth_info
+
     self.registrar = p.transfer_to
     save
   end
diff --git a/spec/epp/domain_spec.rb b/spec/epp/domain_spec.rb
index b24e0e97d..beeb50b0a 100644
--- a/spec/epp/domain_spec.rb
+++ b/spec/epp/domain_spec.rb
@@ -122,6 +122,16 @@ describe 'EPP Domain', epp: true do
         expect(response[:result_code]).to eq('2200')
         expect(response[:msg]).to eq('Authentication error')
       end
+
+      it 'creates new pw after successful transfer' do
+        pw = Domain.first.auth_info
+        xml = domain_transfer_xml(pw: pw)
+        epp_request(xml, :xml) # transfer domain
+        response = epp_request(xml, :xml) # attempt second transfer
+
+        expect(response[:result_code]).to eq('2200')
+        expect(response[:msg]).to eq('Authentication error')
+      end
     end
 
     context 'with citizen as an owner' do