The Interstate Recognition Of Notarizations Act

By Big Tent Democrat, Section Other Politics
Posted on Thu Oct 07, 2010 at 08:08:37 AM EST
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Here is the text of the law I discuss below passed under extraordinary circumstances by the Congress that will make foreclosures easier:

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Interstate Recognition of Notarizations Act of 2010’.

SEC. 2. RECOGNITION OF NOTARIZATIONS IN FEDERAL COURTS.

Each Federal court shall recognize any lawful notarization made by a notary public licensed or commissioned under the laws of a State other than the State where the Federal court is located if--

(1) such notarization occurs in or affects interstate commerce; and

(2)(A) a seal of office, as symbol of the notary public’s authority, is used in the notarization; or

(B) in the case of an electronic record, the seal information is securely attached to, or logically associated with, the electronic record so as to render the record tamper-resistant.

SEC. 3. RECOGNITION OF NOTARIZATIONS IN STATE COURTS.

Each court that operates under the jurisdiction of a State shall recognize any lawful notarization made by a notary public licensed or commissioned under the laws of a State other than the State where the court is located if--

(1) such notarization occurs in or affects interstate commerce; and

(2)(A) a seal of office, as symbol of the notary public’s authority, is used in the notarization; or

(B) in the case of an electronic record, the seal information is securely attached to, or logically associated with, the electronic record so as to render the record tamper-resistant.

SEC. 4. DEFINITIONS.

In this Act:

(1) ELECTRONIC RECORD- The term ‘electronic record’ has the meaning given that term in section 106 of the Electronic Signatures in Global and National Commerce Act (15 U.S.C. 7006).

(2) LOGICALLY ASSOCIATED WITH- Seal information is ‘logically associated with’ an electronic record if the seal information is securely bound to the electronic record in such a manner as to make it impracticable to falsify or alter, without detection, either the record or the seal information.

Sounds reasonable. Here's the problem - anyone can be a Notary Public by paying a nominal fee and taking a test. There is no regulatory regime that oversees notary public in most states.

The other issue is what precisely does "recognize" mean in terms of this law. If the notarized document can be rebutted and is treated like any other piece of evidence, then fine and dandy. But as we now know, courts have been rocket docketing foreclosure actions. This is just one more excuse to deny due process.

Given the suspicious circumstances of the passage of this bill, the intent seems clear - to make it easier for people to be denied their due process in foreclosure actions.

At the very least, in light of recent events, more study of the effect of this law is necessary.

FULL DISCLOSURE: This law affects cases I am involved in. Speaking for me only

< Achievements! Congress Passes Bill To Make Foreclosures Easier | What does "Recognize" Mean? >

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The Interstate Recognition Of Notarizations Act | 18 comments (18 topical)

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Too true... (5.00 / 1) (#3)
by kdog on Thu Oct 07, 2010 at 08:52:06 AM EST

Here's the problem - anyone can be a Notary Public by paying a nominal fee and taking a test

To nail the point home, I used to be a notary public in the State of Florida...I don't even remember a test, just sending a money order & app, and getting my stamp.

If the man will let my arse do it, you guys can only imagine the winners out there with notary stamps:) Sounds like a lot of power for a two-bit notary public.

And we're supposed to buck up (5.00 / 1) (#4)
by scribe on Thu Oct 07, 2010 at 08:58:45 AM EST

and vote for the clowns that passed this?

Since there's no record of the votes, that means all of them are on the hook for it.

Our transparent legislative process (none / 0) (#1)
by Coldblue on Thu Oct 07, 2010 at 08:29:41 AM EST

indeed.

Apr 27, 2010: This bill passed in the House of Representatives by voice vote. A record of each representative's position was not kept.
Sep 27, 2010: This bill passed in the Senate by Unanimous Consent. A record of each senator's position was not kept.

Stop and consider the financial implications (none / 0) (#2)
by BTAL on Thu Oct 07, 2010 at 08:31:11 AM EST

of large numbers of invalid foreclosures. The banks are already deep into the extend and pretend on the value of those mortgage assets on their books, even after TARP. When they then attempt to liquidate those assets to clear the books and cannot they take a 100% hit. Now multiply that times a percentage of the foreclosures to get an idea of what happens to their positions. Pile on what the OH AG is doing by suing for $25K punitive damages for each bad foreclosure - this could end up being in the BILLIONS - making 2008 look like a walk in the park.

This can also ripple into the title insurance industry resulting in huge liabilities due to clouded titles.

This act is bad for what it is attempting to cover up.

Large numbers of mortgages which can't be (5.00 / 2) (#7)
by scribe on Thu Oct 07, 2010 at 09:13:28 AM EST

foreclosed upon means three things:

A lot of people get their houses free and clear, which then frees up their money otherwise to be used on mortgages for ... consumption and ... economic growth (or reducing their credit card debts, if they choose).
The banks take a hit for their frauds and the rich investors get to live like the rest of us.
Small lawyers get some work out of cases to clear titles, for the homeowners who now own their house free and clear, want to sell them and need to make sure their title is free and clear.

I like it.


: You might want to take another look (none / 0) (#10)
by BTAL on Thu Oct 07, 2010 at 09:29:32 AM EST

after removing those rose colored glasses.
Am in complete support of making the banks/servicing companies prove they have the legal ownership position to foreclose - no free ride for them. However, there is no viable reason to allow people who have defaulted on their mortgages to get a free ride.

: I was thinking the same... (none / 0) (#11)
by kdog on Thu Oct 07, 2010 at 09:51:23 AM EST

what's the problem with the banks being allowed to reap the consequences of the "positions" they took? It's not like they're pitching in here meeting Main St. in the middle for the good of the country, they want 100% of what never existed except on a shady spreadsheet.
I say we stiff 'em...they want class war, and we got the numbers. If it means us vs banks & govt, so be it...we still got the numbers, we only need find the courage and will.

One of the many things wrong (none / 0) (#5)
by ruffian on Thu Oct 07, 2010 at 08:59:45 AM EST

with TARP at the time was that the banks never had to come clean about the depth of their toxic asset exposure. Do you think the so-called "stress tests" took any of this fraud into account?

Freakin' mess, part two.


it also means (none / 0) (#6)
by cpinva on Thu Oct 07, 2010 at 09:12:01 AM EST

that all of them can deny having voted for it.

And we can presume them (5.00 / 1) (#8)
by scribe on Thu Oct 07, 2010 at 09:14:10 AM EST

to be self-serving liars when they do so.


: And that whole "unanimous consent" (5.00 / 1) (#12)
by scribe on Thu Oct 07, 2010 at 10:00:12 AM EST

thing?
Kind of hard to avoid the implication of support.

methinks that's the point: (none / 0) (#9)
by cpinva on Thu Oct 07, 2010 at 09:24:09 AM EST

If the notarized document can be rebutted and is treated like any other piece of evidence, then fine and dandy

under this bill, if signed into law, it won't be. otherwise, why bother going to all this trouble, to restate the obvious? the key word, as you note, is "recognize", and what the definition of that word, for purposes of this bill, is.

were there any available committee reports, related to this legislation, that might shed light on what both the house and senate intended it to mean, in this context?

for myself, it appears to be congress' cloying method of giving those documents the presumption of validity, requiring a near overwhelming (and thus, extremely difficult) body of evidence to rebut them.

that both houses made a point of not keeping any record of who voted for this, is sufficient evidence, in and of itself, that it should be vetoed.

This also kills the requirement to produce (none / 0) (#13)
by scribe on Thu Oct 07, 2010 at 10:03:27 AM EST

the "blue ink" mortgage and note. The Act adopts the definition of "electronic record" from 15 USC 7006. That section contains definitions and states:

(2) Electronic. The term "electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.
* * *
(4) Electronic record. The term "electronic record" means a contract or other record created, generated, sent, communicated, received, or stored by electronic means.
* * *
(9) Record. The term "record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.

So, if they have an electronic copy of the mortgage or note and it has a notary stamp of some flavor on it - it goes in. No need to show the original document.

Precisely... (5.00 / 1) (#14)
by BTAL on Thu Oct 07, 2010 at 10:08:01 AM EST

The servicing companies & banks have been using the MRES system to sell and bundle mortgages. In some cases the transfers were just Excel spreadsheets with the property/borrower/mortgage data.

Give them the opportunity to electronic "back notarize" those transactions and wha-la no need to prove they have legal standing to foreclose.


: You might mean... (none / 0) (#18)
by sj on Thu Oct 07, 2010 at 12:36:59 PM EST

--- "voila!" when you say "wha-la", yes/no?

So everything will have a magic clear (5.00 / 1) (#16)
by Militarytracy on Thu Oct 07, 2010 at 11:09:06 AM EST

title even if it doesn't? My understanding is that there are about four specific places that a mortgage moving into a securitized trust needed a wet ink signature. Because they were only interested in "creating" mortgage backed securities as quickly as possible because that is where the big money for them was, they simply began to not obtain those signatures or send the mortgages through the motions that were actually required for the mortgage to legally become a part of a securitized trust. Was this done because many of the mortgages contained so much fraud as well as saving time in order to make more money?

So they made extremely risky loans, and many of those somehow magically received AAA ratings. They said to hell with legally conveying titles because too many people are involved in that process and it takes up time. The risky loans failed literally exploding the economy....and now those that suffer due to that and who have fought tooth and nail and still can't make anything work will not be worked with either. They will quickly and quietly have their homes removed from them, the same way this disaster was created.....quickly, quietly, and fraudulently.


Junk Debt Buyers Jumping for Joy? (none / 0) (#15)
by MAD in CO on Thu Oct 07, 2010 at 10:47:37 AM EST

Seems to me this will not only impact mortgages but many other civil procedures, denying defendants due process. Very troubling times...

California Notarization Law (none / 0) (#17)
by movalca on Thu Oct 07, 2010 at 12:28:36 PM EST

If the indivdual states would enact Notarization Laws the same as California, the problem of fraudulent signing may be averted. however ther are always going to be shady Notaries, just like there are shady lawyers (I know,most of them get elected).