TX House Bill 3186 | NNA
Law

TX House Bill 3186

Notary Law Update: TX House Bill 3186

State: Texas

Summary:

HB 3186 states that a biometric identifier (which would include a journal thumbprint according to the Secretary of State’s interpretation) captured for a commercial purpose may be disclosed only under certain circumstances and must destroyed within a certain amount of time. Thus, the NNA now counsels Texas members that they should not capture thumbprints in their journals.

Signed:  June 19, 2009

Effective:  September 01, 2009

Chapter: 1163

Affects:

Amends Section 503.001 of the Texas Business and Commerce Code

Changes:
  1. Clarifies that a person may not sell, lease or otherwise disclose the biometric identifier of a person captured for a commercial purpose unless: (a) the individual consents to the disclosure for identification purposes in the event of the individual’s disappearance or death; (b) the disclosure completes a financial transaction that the individual authorized; (c) the disclosure is required or permitted by a federal statute or by a state statute other Texas Gov’t Code Chapter 552; or (d) the disclosure is made by or to a law enforcement agency for a law enforcement purpose in response to a warrant. (Note: “biometric identifier” is defined as a retina or iris scan, fingerprint, voiceprint, or record of hand or face geometry.)
  2. Clarifies that a person who possesses a biometric identifier captured for a commercial purpose shall destroy the biometric identifier according to the following rules: (a) within a reasonable time, but not later than the first anniversary of the date the purpose for collecting the identifier expires; (b) if the biometric identifier is used in connection with an instrument or document that is required by law to be maintained, within a reasonable time, but not later than the first anniversary of the date the instrument or document is not longer required to be maintained by law; or (c) if the biometric identifier has been collected for security purposes by an employer, on  termination of the employment relationship.
  3. Clarifies that the new law applies to biometric identifiers possessed on or after the effective date, or before the effective date for identifiers captured for a commercial purpose.
Analysis:

Texas House Bill 3186 became law on September 1, 2009, but did not pop up on our radar because the bill is not directly about notarization or Notaries. Nevertheless, HB 3186 has ramifications for Notaries who capture a signer’s thumbprint in the journal, given that Texas Government Code Section 406.014 states that a Notary’s journal is a public record that must be disclosed and the new law states that any biometric identifier (which would include a journal thumbprint) captured for a “commercial purpose” may be disclosed only under certain circumstances. The Texas Secretary of State’s office “discourages collection of biometric info, including thumbprints, by a notary public. The collection of such information is discouraged because a notary’s records are public information and must be disclosed, and the disclosure of thumbprints is restricted [by Texas Business and Commerce Code Section 503.001 et seq.” (e-mail from Leigh Joseph, an attorney with the Business & Public Filings Division of Texas Secretary of State’s office). Any person who captures or possesses a biometric identifier without following the provisions of Section 503.001 of the Business and Commerce Code is subject to a civil penalty of up to $25,000 for each violation (Bus. & Com. Code Section 503.001[d]).

Thus, it seems best to counsel Texas Notaries to avoid capturing or possessing journal thumbprints, a longstanding NNA best practice designed to protect document signers and documentary transactions from fraud. In making this recommendation, we note that the law applies only to biometrics captured for a “commercial purpose.” Regrettably, the new law does not define what constitutes a commercial purpose, a critical omission that would have clarified the extent to which the law applies to Notaries. The term is defined five times in the Texas Statutes and in each case the definition is said to apply to the particular section of the law in which it is found. A “commercial purpose” as defined and applied in Section 17.08 of the Business and Commerce Code, means a purpose that is “intended to result in a profit or other tangible benefit.” Given this definition, clearly Notaries notarize many documents that are not for a commercial purpose, such as an advance health care directive or a self-proving affidavit of a will.

This new law is consistent with a recent administrative rule change made by the Secretary of State prohibiting Notaries from recording serial numbers from identification documents in their journals. In this day of heightened risk of identity theft, the public policies of open public records (Notary journals) and protecting individual privacy must be balanced, and Texas has come down clearly on the side of individual privacy.

The new law complicates matters for Notaries who already have biometric identifiers in their journals. Given that the provisions for disclosing biometric identifiers apply to any identifier in the possession of a Notary on the effective date (September 1, 2009), the NNA urges Notaries to obtain a journal privacy guard to shield existing journal entries from disclosure or view by any person inspecting the journal. Texas Notaries must take seriously the rules for disclosing biometric identifiers and the hefty civil penalty of $25,000 per violation for failure to follow these rules. What about the provisions of the new law requiring biometric identifiers to be destroyed within a prescribed period of time? We interpret Section 503.001(c-1) of the Business and Commerce Code to permit the Notary to retain the biometric identifiers in their journals for as long as they must maintain his or her journals. We would hold that an official journal is a “document” required by law to be retained by a Notary and cite Government Code Section 406.014. When the Notary decides to resign the commission, or upon death or removal from office, the Notary or Notary’s personal representative must immediately deposit all journals with the county clerk in the county in which the Notary resides or resided (Gov’t Code Section 406.022). At that point, the journal records and all recorded thumbprints become the possession of the county clerk and the county clerk is subject to Government Code Chapter 650 for the proper storage and disclosure of the biometric identifiers.

Read the bill text.

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