VA House Bill 2318/Senate Bill 827 | NNA
Law

VA House Bill 2318/Senate Bill 827

Notary Law Update: VA House Bill 2318/Senate Bill 827

State: Virginia

Summary:

House Bill 2318/Senate Bill 827 permits an electronic Notary to perform an eNotarization without the signer appearing physically before the electronic Notary but via video and audio conference technology instead. The bills specify new forms of identification an electronic Notary must use to identify a signer appearing via videoconference and require electronic Notaries to archive recordings of the video and audio of each such eNotarizations for a period of 5 years. Signers of these eNotarizations must accept the courts and law of Virginia as the choice of venue for the resolution of any disputes arising from these eNotarizations.

The audio- video-conference provisions of the bill take effect July 1, 2012.

Signed:  March 26, 2011

Effective:  July 01, 2011

Chapter: 731/834

Affects:

Amends Sections 47.1-2, 47.1-7, 47.1-12, 47.1-13, 47.1-14, and 47.1-15 of the Code of Virginia

Changes:
  1. Permits, but does not require, an electronic Notary to base “satisfactory evidence of identity” for an electronic notarization on video and audio conference technology.
  2. Stipulates that video and audio conference technology used to establish satisfactory evidence must conform with the standards for electronic video and audio communications used in criminal trial cases set forth in COV 19.2-3.1 subdivisions B1, B2 and B3.
  3. Stipulates that if video and audio conference technology is used, an electronic Notary must identify the signer on the other end of the conference by: (a) personal knowledge;  (b) “an antecedent in person identity proofing process in accordance with the specifications of the Federal Bridge Certification Authority”; or (c) a valid digital certificate accessed by biometric data or by use of an interoperable Personal Identity Verification (PIV) card that is designed, issued and managed in accordance with the specifications published by the National Institute of Standards and Technology in Federal Information Processing Standards (FIPS) Publication 201-1.
  4. Authorizes a Notary to perform a new notarial act known as “verification of fact,” in which a Notary reviews public or vital records to ascertain or confirm facts regarding a person's identity, identifying attributes, or authorization to access a building, database, document, network, or physical site or validate an identity credential on which satisfactory evidence of identity may be based.
  5. Clarifies that in registering for a commission to perform electronic notarial acts, an application must include a general description of the technology or technologies the applicant will use to create an electronic signature.
  6. Repeals a prior provision requiring an applicant for an electronic Notary commission to provide certain specific information related to the licensure of any device the applicant planned to use to create an electronic signature on the application for an electronic Notary commission.
  7. Provides that any eNotarization performed by a Virginia electronic Notary (including acts performed via video and audio conference) shall be deemed to be performed within the commonwealth and governed by Virginia law.
  8. Stipulates that in performing an electronic notarial act a Notary shall exercise a high degree of care in ascertaining the identity of any person who is the subject of the electronic notarial act.
  9. Requires an Electronic Notary who performs an eNotarization using video and audio conference technology to keep a copy of the recording of the conference and a notation of the identification relied upon for a period of five years from the date of the transaction.
  10. Clarifies that the prohibition against notarizing when a signer is not in the presence of the Notary does not apply to the video and audio conferences described here.
  11. Clarifies that a Virginia Notary may perform a notarial act outside of the commonwealth provided the notarial act is performed in accordance with Virginia law. (Note: the bill strikes a previous provision stating that Virginia Notaries may perform notarizations out of state only if the document would be admitted to record in Virginia.)
  12. Assigns a delayed effective date to the video and audio conference provisions of the bill.
  13. Makes minor technical changes.
Analysis:

House Bill 2318/Senate Bill 827 departs from settled Notary law and practice by allowing a Virginia electronic Notary Public to dispense with the physical presence requirement and conduct an electronic notarization with the signer “appearing” via video-conference. (Note: In this analysis, the term “videconference” includes both video and audio.) Any video-conference eNotarization must conform to standards for criminal trials and proceedings as specified in the criminal statutes of the Code of Virginia. Proponents of the bills argued that if the Supreme Court of Virginia allows court hearings and proceedings to occur via video-conference for criminal defendants whose constitutional rights must be protected, then electronic notarial acts surely can be allowed using video-conference. The NNA vigorously opposed this legislation and mounted several grassroots campaigns urging Virginia Notaries to oppose these bills. Ultimately, large majorities in both chambers of the Virginia General Assembly voted to approve the measures. Last year, the NNA was successful in killing a similar bill after it had passed the House of Delegates.

A number of things must be kept in perspective with respect to these video-conference electronic notarizations. First, only electronic notarizations may be performed by video-conference. A Notary performing a paper notarization may not utilize this technology. Second, in order to perform electronic notarizations by video-conference, a person must be commissioned as an electronic Notary. A regular Notary commission does not authorize a Notary to perform electronic notarial acts. A separate electronic commission must be obtained. Third, the video-conference provision is permissive. That is, electronic Notaries may perform an electronic notarial act via video-conference but are not required to do so. Virginia statute expressly allows a Notary to decline to notarize a document  (COV 47.1-15), and the NNA will strongly recommend that Virginia eNotaries not utilize videoconference and always require the signer to physically appear in the eNotary’s presence. Fifth, Electronic Notaries using video-conference must record and archive the complete video and audio of an electronic notarization for a period of five years in addition to keeping an electronic journal for each eNotarization previously required by statute.

So how does an electronic Notary actually identify a signer appearing via video-conference? An eNotary who uses video-conference must identify the signer on the other end of the video feed either by personal knowledge or one of two brand new electronic identification methods. One is known as an “antecedent in-person identity proofing.” According to the standards for issuing digital certificates in conformance with the Federal Bridge Certification Authority, an applicant for a digital certificate may be identified using knowledge-based authentication questions that only the person would be able to know. Most people who use the Internet have been asked to answer knowledge-based questions such as, “what is your mother’s maiden name,” to authenticate to a Web site. However, the “antecedent knowledge” required by the Federal Bridge involves specific questions that would be virtually impossible for the average person to know or guess correctly. Incidentally, the new notarial act of “verification of fact” authorized by HB 2318/SB 827 permits a Notary to review public or vital records to ascertain or confirm facts regarding a person's identity or validate an identity credential on which satisfactory evidence of identity may be based. The bills’ proponents clearly intended this new power to be used precisely for accessing the credit reports and other databases containing the questions and answers used to establish a person’s identity for video-conference electronic notarizations. A second new form of identification an electronic Notary may use to identify a signer via video-conference is a digital certificate accessed by a biometric (a thumbprint, facial or iris scan, for example) or which is accessed by means of a Personal Identity Verification (PIV) smartcard issued to federal employees. This latter form of identification provides a clue that government contractors doing business with technology firms in Northern Virginia may have been behind the enactment of HB 2318/SB 827.  It is important to note that an electronic Notary may not use any other traditional identification credential, such as a passport or driver’s license, to identify a person appearing via video-conference. In addition, credible witnesses may not be used. Most Notaries will never have heard of these new forms of identification, much less know how to use them, and the bill does not require electronic Notaries to be educated in these new forms of electronic identification. This is a major shortcoming of the legislation and demonstrates that in the end, HB 2318/SB 827 were intended to be used by a small fraction of Virginia Electronic Notaries having this knowledge and capability.

Curiously, this legislation also clarifies that in performing an electronic notarization, a Notary shall exercise a high degree of care in identifying the signers of these acts. The NNA finds it ironic that untested means of identification will now become the basis for the standard of care used by Notaries in establishing personal identification for important financial documents such as mortgages, deeds, trusts and wills and personal documents such as powers of attorney in the electronic world.

The architects of this legislation clearly intended to allow people all over the U.S. and even the world to appear before a Virginia electronic Notary via videoconference. This will have implications for the choice of venue in disputes arising over these electronic notarizations. Out-of-state signers appearing via videoconference will have to accept that any electronic notarization shall be deemed to have been performed in Virginia and subject to the law and courts of Virginia.

The two bills also contain a few other noteworthy changes that have received less attention. First, changes have been made to the application process for an electronic Notary commission. Second, prior law allowed a Virginia Notary Public to notarize outside of Virginia if the document was to be admitted for record within Virginia. The statute now allows Notaries to notarize out of state as long as the notarial act is performed according to Virginia law and not the law of the state where the notarization was performed.

In a concession to the NNA and others who expressed concern over the videoconference provision of HB 2318/SB 827, the effective date for this provision was pushed back to July 1, 2011 in order to make the videoconference provision secure. The NNA had fought for the bills to contain a reenactment clause requiring the General Assembly to pass the bills next year for them to become effective.

Finally, COV 47.1-6.1, a new statute enacted in 2009 after concerns were raised by the Virginia Governor about the security of electronic notarizations, requires the Secretary of the Commonwealth to develop standards for electronic notarization and the Virginia Information Technologies Agency to provide assistance to the Secretary relating to the equipment, security, and technological aspects of the electronic notarization standards. The NNA believes that rules implementing the video and audio conference provisions of this new law will be required in order to ensure that electronic notarizations performed via video and audio technology are secure.

Read the bill text (House Bill 2318 -- Senate Bill 827 is the same).

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