NSW prescribes reasonable steps for the identification of mortgagors

In 2009 the NSW Real Property Act was amended by the insertion of  section 56C to require mortgagees to take reasonable steps to identify mortgagors or face cancellation of their mortgage. Section 56C(2) deemed steps prescribed by the regulations as reasonable as being reasonable for the purposes of s56C.

The Real Property Regulations have now been amended to insert Regulation 16 which went into force on 1 January 2015. These prescribe “reasonable steps” as being an adherence to the Verification of Identity Standard set out in Schedule 8 to the NSW Participation Rules for Electronic Conveyancing.

Version 2 of the participation rules were determined on 29 August 2014 by the Registrar General pursuant to section 23 of the Electronic Conveyancing National Law (NSW) which draws its force from and is an appendix to Electronic Conveyancing (Adoption Of National Law) Act 2012 (NSW)

The Verification of Identity Standard prescribes:

  1. A face-to-face in-person interview.
  2. The mortgagor must bear a “reasonable likeness” to the person depicted in photographs in the identification documents.
  3. The mortgage must be signed by the mortgagor in the presence of the person who identified the mortgagor.
  4. The identification documents must be originals and be produced by the mortgagor.

The standard then prescribes the identity documents required in a cascading fashion. The Gold Standard being the possession of a passport and drivers licence. This obviating the need for anything else to be produced. Thereafter as less probative documents are produced more of them are required. Those presenting with a dearth of documentation are required to be accompanied to the face-to-face interview by an “Identity Declarant” who themselves must be indentified in accordance with the standard and in certain circumstances must be a member of specified professions.

 

 

 

 

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