Conveyancing Rules and Verification of Identity. 14 June 2016

Transcription

1 Conveyancing Rules and Verification of Identity 14 June 2016

2 Agenda 9:30 Introduction Greg Channell 9:35 Conveyancing Rules and VOI 10:10 Identity Agents Director, Legal/Industry Engagement/Governance ZipID Sean Simmons Head of ZipID 10:30 IDSecure Mark Paholski Managing Director 10:50 Australia Post Paul Tumminello Account Executive NSW 11:10 Q &A with all presenters Close

3 Conveyancing Rules and Verification of Identity Introduction 3

4 Conveyancing and Digital Transformation The digital revolution is here and is ongoing It will change conveyancing in many ways, some we can see and others as yet unforeseen The challenge for every one in every sector of the property market is to find the opportunities and benefit from them We have to recognise that the disruption that we see driven by technology, the volatility in change is our friend if we are agile and smart enough to take advantage of it. Malcom Turnbull

5 Some changes on the way Changes that will impact conveyancing: Priority Notices to be introduced in late 2016 Uniform National Mortgage (April 2017) - other national Forms? 2016 edition Contract - Fed Govt issues Foreign Resident Withholding provisions Foreign Ownership register - s47 land tax certificate changes Electronic contracts and Electronic Vendor Disclosure Electronic communications with client (PEXA SettleMe) LPI scoping study 5

6 Conveyancing Rules and Verification of Identity Introduction - Electronic Conveyancing Update 6

7 EC Implementation in NSW Release 1 8 October Mortgages and Discharges - Big 4 banks + others Release 2 14 November Transfers, Caveats & Withdrawals of Caveat - Representative Subscribers - Electronic settlement Over 50,000 dealings lodged electronically Over 1,100 Subscribers signed up in NSW Next - Alignment rollout 1 st half Priority Notices October

8 e Dealing Lodgment Statistics to 3 June 2016 Total Release 1 Lodgments (DMs & Ms) 2923 R2 Dlg Type Totals: DM: T: 368 M: WX: 213 X: 635 Total Release 2: Total e Lodgments

9 TOTAL SOLICITORS (NSW) 633 TOTAL CONVEYANCERS (NSW) 300 TOTAL SOLICITORS (VIC) 78 TOTAL CONVEYANCERS (VIC) 1 TOTAL SOLICITORS (QLD) 40 TOTAL SOLICITORS (ACT) 2 TOTAL SOLICITORS (WA) 5 TOTAL CONVEYANCERS (SA) 1 TOTAL SOLICITORS (SA) 3 TOTAL FIs 46 TOTAL SUBSCRIBERS IN NSW

10 Benefits of electronic conveyancing Eliminates long interactions with banks to arrange settlement and physical attendance at settlement Eliminates gap (risk) between settlement and lodgment Immediate confirmation of lodgment Earlier availability of cleared funds after settlement No need to physically lodge documents with LPI particularly useful for caveats Easier access for rural and remote communities

11 Conveyancing Rules and Verification of Identity Conveyancing Rules 11

12 Alignment of paper and electronic processes Both electronic and paper conveyancing will continue in parallel for a while. But the process will become the same one process one workflow, one set of rules Real Property Amendment (Electronic Conveyancing) Act 2015 The Registrar General may make conveyancing rules covering: the verification of identity and authority, client authorisations, certifications to be given retention of evidence Phasing out of CTs Priority Notices - Electronic only dealing 12

13 Conveyancing Rules The Real Property Amendment (Electronic Conveyancing) Act 2015 introduced a new section 12E into the Real Property Act 1900 which allows the Registrar General to make Conveyancing Rules. Alignment provisions in the Conveyancing Rules will largely parallel provisions in the Participation Rules for electronic conveyancing. The Rules will align paper conveyancing practices and workflows with those developed for electronic conveyancing and will be implemented in stages. 13

14 Conveyancing Rules Real Property Act Section 12E - The Registrar-General may make conveyancing rules covering, for example, verification of identity and authority, client authorisations, the retention of documents and evidence classes of documents that must be lodged electronically The Registrar-General may refuse to accept or register, or may reject, a conveyancing transaction that does not comply with the requirements of the conveyancing rules [s. 12E (9)] 14

15 Conveyancing Rules and Verification of Identity Verification of Identity (VOI) Rules

16 Conveyancing Rules Section 12E (1)(a) Verification of Identity and Authority the standards to which identity and authority are to be verified, the classes of persons whose identity and authority is to be verified, the classes of paper documents to which verification of identity and authority requirements apply, who can undertake verification of identity and authority, and any supporting evidence and retention requirements 16

17 VOI - Current Situation Formal VOI requirements currently apply for: mortgagees to identify the mortgagor s 56C Real Property (RP) Act attesting witnesses s 117 RP Act electronic transactions - Rule 6.5 NSW Participation Rules Due diligence requirement to know client

18 VOI - Conveyancing Rules Version 1 commenced 1 May 2016, transition period of 3 months before full compliance required on 1 August 2016 Verification of Identity (VOI) requirements Reasonable steps Identity Agents VOI Standard (Sch 8 Participation Rules) Verification of Authority (right to deal) Retention of evidence Guidance notes on 18

19 VOI - Conveyancing Rules Apply to solicitors and conveyancers Formal (standardised) Verification of Identity (VOI) requirements for all conveyancing transactions Consistent national requirements across paper and electronic

20 VOI - Conveyancing Rules Rationale Significant fraud mitigation and consumer protection measure Applying consistent requirements in all paper and electronic conveyancing transactions

21 VOI - Conveyancing Rules What is required? You must take reasonable steps to: verify the identity of your client [R 4.1.2] either by: applying the VOI Standard or in some other way that constitutes reasonable steps [R 4.1.3] and ensure the client is a legal person and has the right to enter into the transaction [R4.3.2] Note Compliance with the National VOI Standard at Schedule 8 Participation Rules is taking reasonable steps but - Further steps may be required not just ticking the box

22 VOI - Conveyancing Rules When are further checks required? [R 4.1.4] Where you know or ought reasonably to know that: any identity Document produced by the Person Being Identified is not genuine; or any photograph on an identity Document is not a reasonable likeness of the Person Being Identified the Person Being Identified and/or the Identity Declarant does not appear to be the Person to which the identity Document(s) relate; it would otherwise be reasonable to do so.

23 VOI - Conveyancing Rules The VOI Standard SCHEDULE 8 NSW Participation Rules Published on LPI website adopted National model Rules Standard applies to electronic conveyancing Mortgagee requirements under s 56C Now to conveyancing practitioners

24 VOI - Conveyancing Rules The VOI Standard Requires face-to-face in-person interview Hierarchy of ID documents, highest possible category must be used Documents must be current (except Passport < 2 years old) Where Documents contain photographs the Identity Verifier must be satisfied that the Person Being Identified is a reasonable likeness (for example the shape of his or her mouth, nose, eyes and the position of his or her cheek bones) to the Person depicted in those photographs

25 VOI - Conveyancing Rules What if you can t meet the VOI Standard Take Reasonable steps If your client doesn t have full documents consider Category 5 an Identifier declaration essentially a referee Do what you are able to do if you have done all you can it can hardly be considered that you have been unreasonable

26 VOI - Conveyancing Rules The ARNECC Guidance Notes ARNECC has published 5 Guidance Notes so far. MPR Guidance Note #2 Verification of Identity (Updated) MPR Guidance Note #4 Right to Deal MPR Guidance Note #5 Retention of Evidence While these relate to the Participation Rules they are equally relevant to the Conveyancing Rules

27 VOI - Conveyancing Rules Options for conducting VOI: Do it yourself Use an Identity Agent ZipID IDSecure Australia Post

28 Identity Agents Australia Post Links IDSecure Pty Ltd ZipID Pty Ltd Software provider Infotrack 28

29 Additional Information Conveyancing Rules data/assets/pdf_file/0016/ /NSW_Conveyancing_Rules.pdf Participation Rules data/assets/pdf_file/0017/ /NSW_Participation_Rules_Version_3.pdf ARNECC Guidance Notes Sign up to newsletter, inquiries ARNECC 29