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New penalties for fraudulent real estate notarizations take effect in Michigan

On January 1, 2012, it became a felony in Michigan to violate state Notary regulations when notarizing real property or mortgage documents — a move by state lawmakers to combat “robo-signing” practices and mortgage fraud, and to put the state’s employers and Notaries on notice that unethical practices will be prosecuted.

The new law, passed and signed last year as Senate Bill 252, was one of eight bills enacted last year to help authorities identify and punish individuals and businesses that deliberately falsify documents and notarizations in real property transactions. Persons found guilty of Notary violations involving mortgage and real estate documents now face maximum fines of $5,000 and maximum prison sentences of up to four years.

The foreclosure crisis and mortgage fraud has prompted lawmakers, the financial industry and corporate boards to place risk management and liability protection at the top of their list of priorities, with a greater emphasis on Notary education. As a result, Notaries have a growing obligation and responsibility to understand and follow proper procedures. That expectation places greater emphasis on the need for continuing Notary education, and the need for employers to competently manage Notary-employees according to state laws, rules and sound policies and procedures.

David Thun is the Assistant Managing Editor with the National Notary Association.

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