New Verification of Identity Requirements for Land Transactions
VERIFICATION OF IDENTITY REQUIREMENTS FOR LAND TRANSACTIONS
The land registries in NSW, Victoria and Queensland have developed and adopted Verification of Identity Standards (VOI Standards) for verifying the identity of parties to land transactions for the purposes of the National Electronic Conveyancing laws in Australia.
The current VOI Standards are set out in Schedule 8 of version 3 of the Model Participation Rules (Rules) developed for the purposes of electronic conveyancing.
To ensure consistency between paper transactions and electronic transactions, the VOI Standards for paper transactions have been introduced in Victoria. NSW and Queensland have also introduced the VOI Standards for the verification of paper mortgages.
Under sections 11A and 11B of the Land Title Act 1994 (Qld) and sections 288A and 288B of the Land Act 1994 (Qld), mortgagees (lenders) are required to take reasonable steps to confirm the identity of mortgagors (borrowers).
Revised practices for lenders confirming the identity of borrowers, to be incorporated into the Queensland Land Titles Practice Manual in the form of the VOI Standards, will take effect from 1 March 2016. Under these practices a lender will be considered to have taken reasonable steps if they have complied with the VOI Standards.
The Victorian Registrar of Titles has adopted new verification of identity requirements for parties who wish to lodge dealings in paper form at Land Victoria pursuant to section 106A of the Transfer of Land Act 1958 (Vic).
The Registrar’s requirements for all dealings, which came into effect on 9 November 2015, have adopted the VOI Standards and under these requirements a solicitor, conveyancer or lender will be deemed to have taken reasonable steps if they have complied with the VOI Standards.
New South Wales
Under section 56C of the Real Property Act 1900 (NSW) lenders are required to take reasonable steps to confirm the identity of borrowers, and regulation 16 of the Real Property Regulation 2014 (NSW) provides that from 1 January 2015 lenders are considered to have taken reasonable steps if they have complied with the VOI Standards.
From 9 November 2015, an amended table of minimum document requirements for verification of identity took effect under the VOI Standards and now applies to verifying borrowers in NSW.
PURPOSE OF VERIFICATION OF IDENTITY
The purpose of carrying out a verification of identity for land transactions is to:
- ensure a person is who they claim to be;
- reduce the risk of identity fraud; and
- prevent the registration of fraudulent land transactions.
WHEN VERIFICATION OF IDENTITY IS REQUIRED
The Rules require solicitors, conveyancers and lenders (Verifiers) to take reasonable steps to verify the identity of:
- their clients;
- borrowers; and
- persons to whom certificates of title are to be provided.
CARRYING OUT VERIFICATION OF IDENTITY
When verifying the identity of a party, reasonable steps to verify their identity must be taken.
‘Reasonable steps’ means the taking of such steps as an ordinarily prudent Verifier would take in the circumstances and in the ordinary course of their business. Whether reasonable steps have been taken is a question of fact depending on the circumstances of each case.
Previous Verification of Identity
Where a verification of identity has occurred within the previous 2 years, the party’s identity is not required to be verified again provided the Verifier takes reasonable steps to ensure they are dealing with the party previously identified.
In order to demonstrate reasonable steps were taken, Verifiers must retain evidence supporting a verification of identity for at least 7 years.
Verification of Identity Overseas
The Rules have established arrangements with the Department of Foreign Affairs and Trade for verifying the identity of people overseas. The arrangements standardise services provided by Australian Embassies, High Commissions and Consulates to persons overseas.
A Verifier may use an agent to undertake verification of identity on the Verifier’s behalf. The Verifier must direct the agent how to conduct the verification of identity, and this could be by using the VOI Standard or some other method that constitutes taking reasonable steps. A Verifier must reasonably believe an agent to be reputable, competent and insured in accordance with the Rules.
Australia Post currently provides a verification of identity service in each of NSW, Queensland and Victoria.
TRESSCOX LAWYERS ASSISTANCE
TressCox Lawyers can assist with verification of your identity.
We use InfoTrack’s ‘IDfy’ iOS app-based system for face to face VOI interviews in our offices. We have worked with InfoTrack to fine tune the app. We can also attend our clients’ offices to carry out VOI interviews using the app. The relevant identity information is encrypted before it is stored.
We have also registered with Australia Post for clients who prefer to attend their local post office to carry out the VOI interview. Certified VOI documents are forwarded to us electronically by Australia Post.
Martyn Tier, Partner
Lynette Reynolds, Partner
Dan Flynn, Partner