New Verification of Identity requirements for Lands Titles documents (including mortgages) in South Australia (by Shannon Adams,

4 December 2013) 1. Where are the requirements found? The new VOI requirements are imposed by a Registrar-Generals Policy entitled Verification of Identity which was released on 24.6.13. See: http://www.sa.gov.au/upload/franchise/Housing,%20property%20and%20land/LSG/NEC/Registrar _Generals_Verification_of_Identity_Policy_Version_1.pdf 2. When will they apply? They will apply to documents executed on or after 1 January 2014. At a Law Society of SA seminar on 23.10.13 the Registrar-General intimated that the date was likely to be put back, but theres been no formal announcement to that effect as at 4.12.13. 3. Which documents will they apply to? 3.1 The new requirements will apply to: 3.2 Mortgages; Transfers; Transmission Applications; Applications to Register Death by Survivor; and Applications for Substitute Certificates of Title.

They also apply when a lawyer, conveyancer or mortgagee hands over a duplicate certificate of title to anyone who is not a lawyer, conveyancer or mortgagee (note that this will effect the handing over of duplicate titles by mortgagees to their customers when mortgages are discharged).

4.

What are the new requirements? 4.1 Identity verification In relation to relevant documents: Legal practitioners and conveyancers must take reasonable steps to verify the identity of their clients; and Mortgagees must take reasonable steps to verify the identity of mortgagors;

unless they have previously done so, in accordance with the Standard explained below, within the previous 2 years.

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4.2

Certificate(s) on document Each relevant document must include a certification (or certifications) to the effect that reasonable steps have been taken to verify the identity of each relevant party (see paragraph 9 below)

4.3

Retention of documents Copies of identification documents relied upon must be obtained and retained for 7 years. While it is not a requirement of the policy (except in relation to verifications by agents), the author suggests that it would be good practice for the person who undertakes a verification of identity to complete a certification document in a form similar to the Agent Certification set out in Appendix D to the Policy and for that document to be retained as well.

5.

Who must be identified? The parties who must be identified under the Policy are: Mortgages all mortgagors; Transfers - all parties; Transmission Applications all executors/administrators; Applications to Register Death by Survivor all survivors; Applications for Substitute Certificates of Title - the registered proprietor, and the applicant unless the applicant is a mortgagee.

6.

What are reasonable steps to verify identity? There is a VOI Standard set out in the Policy (clause 7). Lawyers, conveyancers and mortgagors are not required to comply with this Standard they may decide that other procedures (eg their AML/CTF procedures) constitute taking reasonable steps. However, if a problem arises theyll have the onus of proving that the steps they took were reasonable, whereas if they comply with the Standard theyll be deemed to have taken reasonable steps ie the Standard provides a safe harbour procedure.

7.

The safe harbour Standard verification requirements for lawyers, conveyancers and mortgagees 7.1 Individuals executing documents on their own behalf (a) There must be a face to face interview between the person doing the verification and the person being identified. Ordinarily this would be done at the same time as the relevant document is executed, although this is not compulsory (the identification must be done at the same time as, or before, the document is executed see clause 4.1 of the Policy). . The person doing the verification can be the lawyer or conveyancer acting for the party being identified, the mortgagee (in the case of a mortgage), or their agent (see

(b)

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paragraph 8 below). Mortgagees should decide which of their staff members are authorised to (a) undertake verifications of identity and (b) execute certificates as to verification on LTO documents. (c) The person doing the verification must examine original and current identification documents, be satisfied that theyre authentic, and be satisfied that the person being identified bears a reasonable likeness to the person depicted in any photographs in the identification documents . Copies of the identification documents must be taken and retained for 7 years. The identification documents on which the person doing the verification may rely are divided into 5 categories (see Appendix B to the Policy), the first 4 for persons who are Australian citizens or residents and the 5th for persons who arent. The person doing the verification should rely upon the highest category of documents which the person being identified is able to produce. If only category 4 documents are available, they must include an Identifier Declaration which is a statutory declaration by someone (the Declarant) who has known the person being identified for at least 12 months. The statutory declaration must comply with clause 7.3 of the Policy). In such cases the person doing the verification must meet with both the person being identified and the Declarant at the same time, and the person doing the verification must also identify the Declarant in accordance with the Standard.

(d) (e)

(f)

7.2

Individuals executing documents as attorneys The person doing the verification must identify each attorney using the process set out above (para 7.1) and: (a) (b) Confirm the details of the donor and the attorney from the Power of Attorney; and Take reasonable steps to establish that the transaction is authorised by the Power of Attorney.

7.3

Bodies corporate executing documents The person doing the verification must identify each individual signing on behalf of the body corporate using the process set out above (para 7.1) and: (a) (b) Confirm the existence and identity of the body corporate by conducting a search; and Take reasonable steps to establish who is authorised to sign the document on behalf of the body corporate.

7.4

Bodies corporate executing documents as attorneys The person doing the verification must do what is set out in para 7.3 above and: (a) (b) Confirm the details of the donor and the attorney from the Power of Attorney; and Take reasonable steps to establish that the transaction is authorised by the Power of Attorney.

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7.5

Individuals executing documents in foreign countries Verification must be undertaken by an Australian Consular Official, an Australian Diplomatic Officer or, if the person is a member of the Australian Defence Force, a competent officer as defined in the Defence Force Regulations see clause 7.9 of the Standard.

8.

Use of agents, to undertake verifications, by lawyers, conveyancers and mortgagees 8.1 A lawyer, conveyancer or mortgagee may engage an agent to undertake a verification of identity on their behalf, provided that the following conditions are satisfied: (a) (b) They must reasonably believe that the agent is reputable and competent; The agent must have professional indemnity and Fidelity insurance each for amount of the leased $1.5 million per claim, be a legal practitioner or conveyancer, or be an ADI; They must direct the agent to conduct the verification of identity in accordance with the Policy; and They must receive from the agent copies of all identification documents relied on by the agent signed, dated and endorsed as true copies together with and Agent Certification in the form set out in Appendix D to the Policy.

(c)

(d)

8.2

Lawyers, conveyancers and mortgagees can enter into arrangements with Australia Post pursuant to which Australia Post can carry out identity verifications on their behalf at Australia Post outlets see https://auspost.com.au/forms/land-title.html. Australia Post charges $39 per verification at the time the verification is done.

9.

The certificate on relevant LTO documents 9.1 A certificate by a lawyer or conveyancer should be in the following form: I, [full name] have taken reasonable steps to verify the identity of [insert [all] transferor(s), transferee(s) mortgagor(s), etc, as applicable]. Signature:. Full name:. Capacity: 9.2 The certificate by a mortgagee should be in the following form: [Full name of mortgagee] has taken reasonable steps to verify the identity of [insert [the] mortgagor or[all] mortgagors, as applicable]. Signature:. Full name:. Capacity:

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9.3

The LTO has not yet included these certificates in its approved forms. The time being, they can be typed in on the face of the document cornerback sheet or on a B1 Annexure form.

10.

Self-represented parties There are special provisions for self-represented parties who execute relevant documents other than mortgages see clause 5 of the Policy. *** More information: www.langes.com.au

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