What you need to know about notary legislation
Notaries public (also called “notaries”, “notarial officers”, or “public notaries”) hold an office which can trace its origins back to ancient Egypt (scribes) — when it became important to document records and transactions.
The tasks of a notary public are to witness and authenticate signatures, administer oaths, verify signatures and take affidavits. The primary purpose of a notary public is to prevent fraud and theft and to prove that a notary was present during signing. For proof, notaries use an embossed seal or stamp to verify their presence.
In general, the steps required for a notary to authenticate a signature are:
- Require a personal appearance
- Scan over the documents
- Verify the signer’s identity and screen for willingness and awareness
- Record the journal entry
- Complete the notarial certificate
Throughout history, notaries have worked face-to-face with their clients to verify identity and signature and perform notarial duties.
Another term that often gets confused with notary is the medallion guarantee, also known as a signature guarantee. Signature guarantees and notary stamps are both used to verify signers’ identify.
The main difference between notary and medallion guarantee is that the medallion is intended specifically for documents involving the transfer of money and “securities” through banks and other financial institutions. The medallion is a guarantee by the original bank or financial institution that the signature is authentic and valid. If the signer forges his/her identity and the document was given a signature (medallion) guarantee, the financial institution is liable for any losses.
Signature or medallion guarantees are not performed by notaries, they are performed by banks, credit unions, and other financial institutions. You can recognize a signature guarantee by the way it looks – the stamp uses a green ink and once the stamp is applied, the bank employee signs his or her name on the stamp.
A state-appointed notary uses a notary stamp to verify the signer’s identity on a variety of legal documents including contracts, wills, power of attorney, testimonies and loan agreements.
Here is what you need to know about changes happening in the notary industry.
On July 1, 2012, Virginia was the first state to approve electronic notary.
What is an electronic notary?
The only difference between traditional and electronic notary is the tool used to perform the notarial act. In a traditional paper notarization, a pen and rubber stamp are the tools used. For electronic notarization, the notary uses a computer and software/hardware to perform the notarial act.
During electronic notary, the steps are generally the same as a traditional notary. The signer appears before the notary, the notary identifies the signer, completes the notarial certificate and affixes the electronic signature and seal.
A notary may electronically notarize a document (via computer and software) in the physical presence of a signer. For customers who are not physically in the same location, the notary may perform a webcam or remote notarial act through the use of audio-video conference technology.
It is important to note that several states have approved the use of electronic notary services but still require the signer to be physically present.
By definition, an eNotary is a notary public who notarizes documents electronically. eNotaries use the following technology to go through the traditional notary steps:
- Digital signature
- Digital notary seal
- Digital documents
- Digital certificate
With electronic notarization, the notary must keep an electronic register (copy) of each act performed for a period of five to seven years (based on each state’s regs). The electronic notary uses technology to ensure that the document is tamper proof.
Remote webcam notary services are used when the signer is not in the same physical location as the notary. It is important to note that several states have approved the use of electronic notary services but still require the signer to be physically present. They are simply going through the traditional steps with the signer on a computer, phone or tablet.
As previously mentioned, Virginia was the first state to approve remote webcam notary and was then followed by Montana, Ohio, Texas, and Nevada. To date, five states have approved remote webcam notary. Another four states are still considering – Minnesota, Nebraska, Oklahoma, and Pennsylvania.
What is the difference between electronic notary (eNotary) and remote webcam notary?
The first point of clarification is that eNotary does not automatically equal remote notary.
Electronic Notary and eNotary: This process is very much like traditional paper-based notary except all the steps happen on a computer or device. The signer is physically present with the notary.
Remote Notary and Webcam Notary: The signer is remote meaning that the notary interacts with the signer through a webcam session. If the person is not known to the notary, ID verification must be completed through a state-approved method. In some states, the remote notary and webcam notary fall under the electronic notary classification so it is important to read the fine print in the state-by-state legislation.
The key takeaway here is that the notary industry is changing! Now that Ohio, Nevada, and Texas have passed the legislation, you can expect to see other states follow suit. Being able to notarize a document from a remote location is a game changer and is an excellent example of how digital transformation can create convenience.
Author: Andy Ambrose is the CEO and co-founder of Liveoak Technologies. Liveoak is a collaboration platform that provides enterprises with remote on-boarding & identity verification tools. Our solution re-creates the power of a face-to-face engagement with the simplicity of a remote digital experience.
Visit this link for some interesting historical facts and trivia about notaries. https://www.nationalnotary.org/knowledge-center/about-notaries/notary-history
Sources: Wikipedia, Superior Notary Services, commonwealth.virginia.gov