AAN Wins Webcam Notarization Battle in Texas, but the War Continues
In the spring of this year, HB 3309 was introduced to the Texas legislature by Rep. Scott Sanford. If passed, HB 3309 would have legalized webcam notarial acts in Texas. As soon as the bill was introduced, the AAN took swift action to defeat the bill. The AAN, with the help of its members, started a campaign to block the passage of HB 3309. AAN hired a legal firm to lobby Texas lawmakers on behalf of Texas notaries.
Thousands of Texas notaries and AAN members responded and let their lawmakers know that such a law in Texas was not necessary. Interestingly enough, many notary associations around the country were silent or took no action. In fact, in an email dated April 7, 2015, a member of Rep Sanford’s office staff emailed the AAN and explained “I have spoken to a number of other notary associations that show favor for the edited bill.” Furthermore, the AAN’s lobbyist quoted Sanford’s staff in an email dated April 16 after her first visit to Rep. Sanford’s office: “…notary associations around the country are in support of the Texas webcam notarization bill.”
While notaries and the AAN won a battle against legalizing webcam notarization in Texas, we are far from winning the war. Legalizing webcam notarization was the primary topic of a meeting held in Chicago on March, 19, 2015 by the Uniform Law Commission (ULC) Study Committee on Revising the Uniform Law on Notarial Acts.
ULC Memo: Revisions to Uniform Notary Law (RULONA) will Include Webcam Notarization
Every reader should take a moment to read this ULC memo summarizing the March meeting held in Chicago that reveals another step toward legalizing webcam notarizations internationally (“cross-border” notarization) and in the U.S.
Memo summary: The committee recommends that the Revised Uniform Law on Notarial Acts (RULONA) be updated to allow webcam notarizations performed by U.S. notaries for U.S. citizens abroad who need to sign documents. Quoted from the memo: “…discuss whether the Uniform Law Commission (ULC) should draft amendments to RULONA, amendments providing a solution to U.S. citizens abroad who wish or need notarizations for use in the various States.”
Meeting participants had an opportunity to express concerns. Only three of those present, Tom Smedinghoff (American Bar Association, Science and Technology Division), Ozie Stallworth (Electronic Notarization Director of North Carolina), and William Fritzlen (U.S. State Dept.) voiced specific concerns that were recorded in this memorandum. (Other attendees apparently voiced no specific opposition.)
Unnamed participants (per the memo) are in favor of allowing remote notarizations in the U.S.: “Some stakeholders at the meeting felt that documents executed domestically should also be eligible for remote notarization.”
One reported concern about infringing on other counties’ sovereignty was heard from William Fritzlen: “The State Department raised the first concern, noting that countries like Switzerland would consider a remote notarization an infringement on their sovereignty. Beyond the implications of such a violation on bilateral relations, the State Department explained that Switzerland, and countries like it, may prosecute American citizens who obtain a remote notarization while in that foreign country.”
Some of the attendees reported reservations regarding ID issues using this type of technology: “Second, stakeholders expressed concern that remote notarization creates a greater or different risk of misidentifying a person than is present during in-person notarizations.”
Notably, the memo doesn’t report that any of the participants were concerned about the signer’s physical presence requirement (signer appearing in front of the notary), or that this new technology increases opportunities for signers being forced to sign documents under duress. (It does, however, mention requiring extra ID measurements.)
Participants in the meeting, with the exception of Smedinghoff and Stallworth, agreed that including U.S. webcam notarizations in the new version of RULONA would delay the implementation of this technology for a couple of years so the insertion of webcam notarization language should be limited for now to foreign notarizations to expedite the revision: “… the stakeholders – with the exception of Tom Smedinghoff and Ozie Stallworth – agreed to limit any amendments to the foreign context in hope of expediting the process for amending RULONA. Those participants did not object to remote notarization per se. Rather, they would prefer any amendments to RULONA permitting remote notarization undergo a lengthier drafting and review process to address the larger issues of domestic notarizations as well.”
As mentioned above, this memo is a must read for all notaries.
Factors that may have slowed states from legalizing webcam notarization
To date, bills to introduce webcam laws have cropped up only in Virginia, Montana, and Texas. However, in the next legislative session, more bills may be introduced across the U.S. There may have been even more bills introduced over the past four years if not for a few events that helped to slow down the momentum for remote webcam notarization.
Veto of the IRON Act in 2011 - The legalization of webcam acts across the U.S. might have been more popular if not for the President’s pocket veto of the Interstate Recognition of Notarial Acts (IRON Act) of 2010. Supporters of the IRON Act fought for several years to see it passed into law. The IRON Act was originally introduced to Congress in 2005 as H.R. 1458 by U.S. Rep. Robert Aderholt (Alabama). It was re-introduced in 2007 as H.R. 1979 and ultimately evolved into H.R. 3808.
One chilling statement plucked from volumes of documents relating to this act reveals that the purpose of the IRON Act was to compel courts in different states to accept notarizations done in other states. “H.R. 1979 compels a court to accept the authenticity of the document, even though the notarization was performed in a state other than where the form is located.” In other words, the IRON Act would remove the rights of all state governments to object to webcam notarial acts legally performed in another state.
President Obama unexpectedly vetoed the IRON Act because he was concerned it would hasten illegal mortgage foreclosures. We can speculate that a welcome but unintended result of the veto was that it threw shadows of legal concern as to whether a notarial act by webcam in Virginia (or any state) would be accepted in other states.
Emergence of the CFPB in 2012 – The Consumer Financial Protection Bureau, an agency charged with protecting the welfare of consumers against bad behavior in the financial industry, drafted thousands of pages of compliance requirements for lenders and their vendors (e.g., title companies). The attention of lenders and their vendors likely turned to meeting compliance demands rather than focusing on promotions of webcam technology.
Secretaries of States Publishing Statements of Opposition – In response to the arrival of the first webcam notarization website in 2010, which claimed that notaries in any state could legally notarize documents using a webcam, many states posted public notices on their websites that said notaries in their states could not notarize documents using webcams. In fact, Ohio’s Office of the Attorney General published a “Scam Alert” on its website warning against webcam online notarial acts.
New Webcam Notary Laws (if Passed) Can’t Address these Issues
Over the past years, as noted in the articles linked at the end of this article, we have identified concerns with remote webcam notarial acts that simply won’t dissolve by passing state laws to legalize them. We have recently discovered that most of our concerns are mentioned in a 2014 presentation prepared by Allison A. DeSantis, Director of Business Services for the Ohio Secretary of State. Her presentation is a cogent collection of arguments that forces all to consider the problems with remote webcam notarization. One of the slides lists a series of questions that supporters of remote webcam notarial acts ignore.
“How can a notary public tell if a signer is under duress? Is there a way to address that concern? If we can’t address that concern, is that reason alone not to permit remote notarizations?”
Endangering contractual agreements – Contract law holds that a person must enter into a contract of his or her own free will. We re-emphasize the quote from Ms. DeSantis’s presentation by stating that the concept of webcam notarization is rife with possibilities that a signer can be coerced to sign a document.
Venue issues – It isn’t difficult to recognize that venue problems will result from notarial acts performed by a notary in one state for a signer in another. Which state’s court has authority? Or does the federal government? In cross-border notarial acts between the U.S. and another country, which country’s court has jurisdiction over a notarial act—the one in Europe or a U.S. court? Laws legalizing webcam acts cannot dictate a solution for this. Many unforeseen challenges will emerge as time passes and numerous notarizations that are performed via webcam may be challenged in the next decade.
No liability taken by technology providers – Some webcam technology providers that operate webcam notarization sites require signers to agree to indemnify and hold harmless the webcam technology provider from any liability issues that result from notarizations performed on their websites.
Third party involvement – Another question is who has rights over the notary records, is it the technology provider or the notary? The technology provider becomes involved in the notarization by being the keeper of the notary’s electronic records. How long must the technology provider archive those records?
ID methods aren’t based on state laws. – When a webcam notarial act is performed, new methods of identifying signers have been introduced that are not compliant with any U.S. state’s laws.
Webcam technology isn’t more secure than a notary and signer meeting face to face. -- Providers of technology say that remote notarization will deter fraud. That has not been proven. It is a nice theory, but hardly a certainty. The supporting arguments for this statement are voluminous. However, one need only to consider how many “secure” databases are hacked each week to see how easily the information relating to transactions can become listed on public websites.
This is a Federal Issue, not a State Issue
Webcam notarial acts are an infringement on sovereign nations’ laws. Refer again to the ULC memo in which the group decides to fix this concern by adding a statement in the RULONA, “…except as prohibited by the law of the jurisdiction in which the document was signed.” Is it going to be the job of notaries public to know the jurisdictions that prohibit a cross-border remote notarial act?
The AAN advocates that if the biggest concern is that our citizens abroad have access to a U.S. notary public, this issue should be addressed by the federal government and such notarizations performed only by federally appointed notaries, or the procedures should be agreed on by the Hague convention members before any cross-border notarizations are made legal in any state.
The AAN believes that the federal government should be in charge of regulating overseas notarizations for U.S. citizens abroad, whether they are members of the military or civilians. The responsibility should not be on the shoulders of state governments to introduce laws that reach beyond the borders of the U.S.
If lack of access to a notary while abroad is the reason behind legalizing remote notarial acts, there is a simpler solution. Expand the ULC’s Uniform Unsworn Foreign Declarations Act, which was passed in 2008 for this very reason, to include other notarial acts. The Uniform Unsworn Declaration Act allows U.S. citizens outside of the U.S. to declare the truthfulness of statements (normally required to be sworn before a notary public) without having to use the services of a notary. This act could be expanded to include all notarial acts.
Another way around legalizing cross-border webcam notarization is to allow notaries in foreign countries to perform the notarial act and bypass the authentication issue agreed upon by the Hague committee members. Again, this is a matter for the federal government, not state governments.
Why has webcam notarization gained any traction at all?
There will be a time in the future when every person is identifiable through biometric identifiers, but that time has not yet arrived. The DeSantis presentation referenced above states the matter perfectly:
“As technology progresses, the more likelihood that we could eliminate all potential problems with remote notarizations. At some point biometrics will be a more reliable method of identification verification than a driver’s license.”
It is hard to believe that notarial laws based on the long-held sacred tradition of the physical presence and personal interaction between a notary public and a signer are in danger of being prematurely toppled. However, it seems that only the AAN is publically and actively campaigning against webcam notarization.
The AAN has been accused of not understanding technology and living in the dark ages as a result of the stand it has taken against webcam notarization. Nothing could be further from the truth; no good reason has been provided to discard the notary’s duty to be personally present in the same place as the signer.
It seems that the promotion of webcam technology for notaries is supported by certain sectors or industries looking to increase profit margins. Supporters endorse passing notary laws to cover theoretical non-events (“what-if?” situations that either do not exist or apply only to a handful of people). There is no reason for someone to travel or relocate to a foreign jurisdiction without leaving a power of attorney behind in the U.S. so that a family member or a representative can handle transactions on his or her behalf.
Notarizing documents internationally and locally was not a problem before, so why is it a problem now? Can webcam notarization supporters name one remote small town in the U.S. that does not have a notary public? A notary is always available in towns of small populations whether the notary is a car dealer, insurance agent, or bank employee. Alternatively, a justice of the peace or judge authorized to perform the same acts as a notary is within a reasonable distance of citizens in all states.
One example of a supporter of webcam notarization, which gives us more reason why the law should be opposed, can be drawn from the AAN’s recent experience. A businessman contacted the AAN repeatedly and said (among other things) that the AAN must support webcam notarization in Texas. After a quick search, it turned out that this businessman had been ordered by the FTC to pay over a million dollars in fines.
Only the AAN and individual notaries public opposed webcam notarization in Texas. There was no assistance offered by other associations.
Montana’s Webcam Laws are More Acceptable than Virginia’s
One of the final observations this article must bring forward is that there are two states that have webcam notary laws on the books: Virginia and Montana. Montana’s law is workable and should be the only pattern for webcam notarization laws considered by any state in the future.
Virginia has laws that are invasive to all states and foreign countries. On the other hand, Montana’s law makes the best of a bad situation; it is superior to the Virginia law. Montana’s law is clear, allows webcam notary acts within the state of Montana, and requires the notary and the signer to know each other, or the notary must use a credible witness who is physically present with the notary to identify the signer.
Who can stop the legalization of webcam notarization in the future?
The following groups can help stop the legalization of unbridled webcam laws in your state:
- Lawmakers who are informed and understand the consequences of notarizing using a webcam without the signer physically present and who recognize the consequences of signing documents under duress
- Notaries who get involved by writing their lawmakers and participating in public hearings in their states
- Notary associations that hire lobbyists and support their members’ best interestsBe watchful for bills introduced to your legislature.
What should notaries do if a webcam notary law is introduced in their state?
- Send a message to your notary association; ask them if they support or oppose webcam notarization laws. Ask them to take a stand. A failure to actively fight a webcam bill indicates that the association has no problem with it.
- Write your lawmakers and oppose webcam notary legislation. If there is a public hearing, make your voice heard by being present at the hearing.
- Encourage your notary association(s) to hire lobbyists to fight such bills
Why should you, as a notary, oppose webcam notarization bills?
Do we really want to change notary procedures that have been working for thousands of years to accommodate the special interests of certain businesses, technology providers, and a few citizens abroad who need to sign documents or sell a property while they are out of the country?
Notaries and U.S. citizens should oppose webcam notarization because it removes the requirement that the signer appear face-to-face with the notary, a requirement that has been intact and worked for thousands of years.
We must not let individuals, special interests, and companies who do not understand notary laws write notary laws for us and dictate that we adopt them.
Ultimately, webcam notary laws will create liability issues for notaries. Notaries are required to ensure the signer is competent and is not signing under duress. As mentioned above, duress can mitigate the valid execution of agreements, and notaries will find themselves dealing with legal battles for notarizing documents without being able to ensure the signer was signing of his or her own free will.
Prepare to engage with your lawmakers; let every notary association you are involved with know that you want them to take a stand. The AAN will continue to monitor the landscape for activity.
Please make sure you read our emails and newsletters and watch our Facebook page. We will do our best to keep you informed.
Related articles from the AAN
- Official Statements on Webcam Notarization (2011)
- Webcam Notarization Issue Update (2013)
- Uniform Notary Law Changes Anticipated (2015)
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Legal disclaimer: The American Association of Notaries seeks to provide timely articles for notaries to assist them with information and ideas for managing their notary businesses, enhancing their notary educations, and securing their notary supplies but makes no claims, promises, or guarantees about the accuracy, completeness, or adequacy of the information contained . Information in this article is not intended as legal advice. We are not attorneys. We do not pretend to be attorneys. Though we will sometimes provide information regarding federal laws and statutes and the laws and statutes of each state, we have gathered the information from a variety of sources. We do not warrant the information gathered from those sources. It is your responsibility to know the appropriate laws governing your state. Notaries are advised to seek the advice of an attorney in their state if they have legal questions about how to notarize.
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