From The National Notary magazine, May 2011 Issue.
The 21st century may well go down in history as the technology age — a time when innovations come so fast that each new technology is rendered obsolete almost before it takes hold. Yet this whirl of inventiveness makes us re-examine traditional ways of doing things, such as performing notarizations.
At a time when the world does $10 trillion worth of business a year over the Internet, some are attempting to redefine what, for centuries, has been the bedrock of notarization — the personal appearance of the signer before a Notary. After all, video conferencing, satellite links and specialized Web sites allow us to have real time, face-to-face conversations with people halfway around the world.
Any discussion of personal appearance must begin with one salient fact: The requirement for a signer to physically be in the presence of a Notary when the notarization is performed is the law in every jurisdiction in the country. It also is an essential element of the National Notary Association-drafted Model Notary Act as well as the Revised Uniform Law on Notarial Acts, authored by the National Conference of Commissioners on Uniform State Laws.
“Personal appearance is the cornerstone of a properly executed notarial act,” insists Mike Smith, Director of Communications for the Georgia Superior Court Clerks’ Cooperative Authority and President of the Notary Public Administrators section of National Association of Secretaries of State (NASS). “Without it, the rest of the act is a moot point.”
The purpose of any notarization is to establish a high degree of trust and assurance in a transaction. Regardless of the type of notarization, each act requires the Notary to verify the identity of the signer and determine that the person is willingly signing the document and understands what the document means. These duties can only be accomplished through personal appearance.
Today, there are hundreds of different types of government-issued IDs that can meet the requirements of satisfactory evidence of identity. But criminals are going to great lengths to steal or falsify identities.
“You have to be able to look at an ID and touch it to see if it has been tampered with,” said Claremont, California, mobile Notary Lisa Thornton.
Personal appearance is just as critical when it comes to determining a person’s willingness and awareness to sign a document. That in-person, face-to-face interaction allows a Notary to observe body language and demeanor, which can give a clue that “something isn’t right,” says Sheri Kesterke, a long-time Notary and village clerk for Berrien Springs, Michigan.
Despite the importance of the personal appearance, anecdotal news accounts and statistical information suggests that it is one of the most — if not the most — violated notarial legal requirements.
Mike Shea, the former Director of Licensing and Enforcement for the Colorado Secretary of State, notes that during his tenure more than 50 percent of the complaints against Notaries involved documents being notarized outside the presence of the signer. Those cases ranged from a Notary who signed stacks of blank medical marijuana certificates to individuals committing real estate fraud.
The most glaring example of what happens when signers and Notaries do not physically meet face-to-face is the recent foreclosure documents scandal. The scandal revolves around charges that law firms and contractors working for lending institutions falsified or improperly altered court documents filed in thousands of foreclosure cases. One of the central accusations being investigated by state and federal authorities is that stacks of documents were notarized outside the signers’ presence, and signatures often were forged, in an assembly-line manner.
The consequences for not requiring personal appearance can be severe and expensive. Victims of fraud can suffer serious financial losses, including stolen property. Notaries face jail time and criminal convictions, loss of the Notary commission, and tens of thousands of dollars (or more) in fines, legal fees and court judgments.
A New Definition?
The push for the convenience of technology has led to efforts by lawmakers, businesses and special interests to redefine personal appearance.
The most recent reimagining of personal appearance came in Virginia when the General Assembly enacted a law authorizing electronic notarizations to take place via video and audio conferencing technology. The backers of the bill do not interpret personal appearance to mean being in the physical presence of the Notary. Instead, they say a webcam encounter satisfies the personal appearance requirement under certain circumstances.
But as Virginia moves into uncharted territory, states such as California are doing the exact opposite. “A video image or other form of non-physical representation is not a personal appearance in front of a Notary Public under current state or federal laws,” said California Secretary of State Debra Bowen in a February alert about a company offering online notarizations.
The California Secretary of State isn’t alone. Wisconsin Secretary of State Doug La Follette issued a similar warning that video images or other forms of non-physical representation aren’t a substitute for a signer’s personal appearance before a Notary. And in an opinion column published in April, North Carolina Secretary of State Elaine Marshall wrote, “Protecting Notary law and its personal appearance requirement goes a long way to avoiding identity fraud.”
According to the eNotarization standards developed by the National Association of Secretaries of State (NASS), “Physical appearance” and “appears before the Notary” mean that the signer and the Notary Public are physically close enough to see, hear, communicate with, and give documents to each other without relying on any electronic device.
Claudine Osborne, a Notary Signing Agent from Madison, Ohio, says she and other Notaries believe that changing the definition of personal appearance will undermine the value of notarizations.
Thornton agrees. “There’s a role for technology in notarization, but it doesn’t replace the essential elements,” she says.
Much of the world enthusiastically has embraced the eased and convenience of online transactions. But the Internet also has been a boon to all types of criminals, and it has helped turn identity theft into the number one consumer fraud crime in the country, according to the Federal Trade Commission.
While there are those who believe technological advances ultimately will change how notarizations are performed, the online video systems available today have not even started to address how they will preserve the security of the most essential, fraud-fighting elements and legal requirements of the notarial act.
Without a signer’s physical presence, it remains impossible to verify a person’s identity. In fact, according to a poll conducted by the National Notary Association in March, Notaries across the U.S. indicated that the most difficult challenge is spotting “signs of an altered or forged identification document — even when a signer personally appears before them.”
Considering how the Internet has been a boon to identity thieves, verifying a person’s identity online is fraught with pitfalls. The public-private effort to develop standards for trustworthy online identity credentials — lead by the Federal Communications Commission — has just begun and could well take years to complete.
Even if a trustworthy Internet ID is developed, appearance via video still will get in the way of screening a signer for willingness and awareness. A Notary will be unable to tell if anyone off screen is pressuring a signer. It also may be much harder to tell if a signer is intoxicated or otherwise unable to understand what is being signed.
Many states require Notaries to keep a record of their notarizations and most recommend it. How are they to be kept? Will a Notary have to keep separate records — one set for paper, in-person notarizations and another for online notarizations? The Virginia law would require Notaries to keep a copy of the video for five years, but that could be very cumbersome and pose a range of financial, technical and security issues. An online system also will have to resolve how to establish venue. How will it work if the Notary and signers are in different counties or states?
As past experience with new online technologies demonstrates, the rush to implement them often opens the door to fraud, says Osborne. “If we’re afraid of fraud now, just imagine what will happen if people start accepting online notarizations.”