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AB-2368 California Online Notary Act of 2018.(2017-2018)

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Date Published: 05/26/2018 04:00 AM
AB2368:v96#DOCUMENT

Amended  IN  Assembly  May 25, 2018
Amended  IN  Assembly  April 19, 2018
Amended  IN  Assembly  March 23, 2018

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 2368


Introduced by Assembly Member Calderon

February 14, 2018


An act to add Section 1181.1 to the Civil Code, and to add the heading of Article 1 (commencing with Section 8200) to, and to add Article 2 (commencing with Section 8231) to, Chapter 3 of Division 1 of Title 2 of, the Government Code, relating to notaries public.


LEGISLATIVE COUNSEL'S DIGEST


AB 2368, as amended, Calderon. California Online Notary Act of 2018.
Existing law authorizes the Secretary of State to appoint and commission notaries public in the number the Secretary of State deems necessary for the public convenience. Existing law authorizes notaries public to act as notaries in any part of the state.
This bill would enact the California Online Notary Act of 2018, and, commencing on July 1, 2019, January 1, 2020, would allow a notary public or an applicant for appointment as a notary public to register with the Secretary of State to be an online notary public, and would require the Secretary of State to develop an application for registration and establish rules to implement the act. act on or before January 1, 2020. The bill would authorize the Secretary of State to establish a fee for an application for registration as an online notary public. The bill would authorize an online notary public to perform notarial acts, and online notarizations by means of audio-video communication. The bill would establish various requirements applicable to an online notary public, including requiring an online notary public to keep one or more secure electronic journals to record online notarial acts, requiring an electronic notarial certificate to be a specified form, and requiring an online notary public to destroy certain information upon termination of a commission, as specified. The bill would make it a misdemeanor for any person who, without authorization, knowingly obtains, conceals, damages, or destroys the certificate, disk, coding, card, program, software, or hardware enabling an online notary public to affix an official electronic signature or seal. By creating a new crime, this bill would impose a state-mandated local program. The bill would also make other conforming changes.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: YES  

The people of the State of California do enact as follows:


SECTION 1.

 Section 1181.1 is added to the Civil Code, to read:

1181.1.
 Section 1181 shall not be construed to authorize any person other than an online notary public authorized by the Secretary of State to perform online notarizations pursuant to Article 2 (commencing with Section 8231) of Chapter 3 of Division 1 of Title 2 of the Government Code, to take proofs or acknowledgments by means of appearances using two-way audio and video communication technology.

SEC. 2.

 The heading of Article 1 (commencing with Section 8200) is added to Chapter 3 of Division 1 of Title 2 of the Government Code, to read:
Article  1. Notaries Public

SEC. 3.

 Article 2 (commencing with Section 8231) is added to Chapter 3 of Division 1 of Title 2 of the Government Code, to read:
Article  2. California Online Notary Act of 2018

8231.
 This act shall be known, and may be cited as, the California Online Notary Act of 2018.

8231.1.
 As used in this article, the following terms have the following meanings:
(a) “Audio-video communication” means being able to see, hear, and communicate with another individual in real time using electronic means.
(b) “Credential” means a record evidencing an individual’s identity pursuant to Section 1185 of the Civil Code.
(c) “Credential analysis” means a process or service operating according to criteria adopted by the Secretary of State through which a third person affirms the validity of a credential through review of public and proprietary data sources.
(d) “Electronic” means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic, or similar capabilities.
(e) “Electronic record” means a document or record that is created, generated, sent, communicated, received, or stored by electronic means.
(f) “Electronic online notarial certificate” means the part of, or attachment to, an electronic record that is completed by the online notary public and contains all of the following:
(1) The online notary public’s electronic signature, as defined in subdivision (f) of Section 27391, where applicable, and electronic seal.
(2) The facts attested to by the online notary public in the particular online notarization.
(g) “Electronic seal” means information within a notarized electronic record that generally corresponds to information in notary seals used on paper records and that, where applicable, conforms to the requirement of this article, including, but not limited to, subdivision (b) of Section 8231.7 and any rules adopted by the Secretary of State.
(h) “Electronic signature” means an electronic sound, symbol, or process attaching to or logically associated with an electronic record and executed or adopted by a person with the intent to sign the electronic record.
(i) “Identity proofing” means a process or service operating according to criteria adopted by the Secretary of State through which a third person affirms the identity of an individual through review of personal information from public and proprietary data sources.
(j) “Notarial act” means the performance of a duty authorized by Section 8205.
(k) “Online notarization” and “online notarial act” mean a notarial act performed by an online notary public by means of audio-video communication technology that meets the standards adopted pursuant to this article and any rules adopted by the Secretary of State.
(l) “Online notary public” means a notary public who has been registered with the Secretary of State to perform online notarizations pursuant to this article.
(m) “Principal” means an individual, other than a credible witness pursuant to Section 1185 of the Civil Code, whose electronic signature is notarized, or whose oath or affirmation is taken by an online notary public during an online notarization.
(n) “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.
(o) “Remote presentation” means transmission to the online notary public through communication technology of an image of a government-issued identification credential that is of sufficient quality to enable the online notary public to identify the individual seeking the online notary public’s services and to perform credential analysis.

8231.2.
 This article applies to online notarizations. To the extent that a provision of this article conflicts with Article 1 (commencing with Section 8200), this article controls with respect to an online notarization.

8231.3.
 The Secretary of State shall adopt rules necessary to implement this article. article on or before January 1, 2020. The rules shall set and maintain standards for online notarizations, including standards for remote presentation, credential analysis, and identity proofing. The rules may also address the form and content requirements for an online notary’s electronic journal. The Secretary of State may confer with other departments or agencies on matters relating to equipment, security, and technological aspects of the online notarization standards.

8231.4.
 (a) (1) A notary public or an applicant for appointment as a notary public may register public, or an applicant during the commissioning of an applicant for appointment as a notary public, may apply for registration with the Secretary of State to be an online notary public in the manner provided by this section.
(2) The Secretary of State may charge a fee for an application for registration submitted pursuant to this section in an amount necessary to administer this article.
(3) The Secretary of State shall develop an application for registration to be submitted by an applicant. The application shall include, but shall not be limited to, all of the following:
(A) The applicant’s name as it appears on the applicant’s commission or application as a notary public.
(B) A certification that the applicant will comply with this article and the Secretary of State’s rules and standards adopted pursuant to this article.
(C) The applicant’s email address.
(b) An applicant for registration as an online notary public shall meet all of the following requirements:
(1) The applicant has a valid commission as a notary public pursuant to Article 1 (commencing with Section 8200), or the applicant has satisfied all of the qualification requirements specified in Article 1 (commencing with Section 8200).
(2) The applicant has paid the fee for an application for registration charged by the Secretary of State.
(3) The applicant has submitted the application for registration to the Secretary of State.
(4) (A) The applicant, in connection with the original application for registration, and each renewal reappointment thereof, has provided proof that the applicant has satisfactorily completed a three-hour course of study and an examination approved by the Secretary of State concerning the functions and duties of an online notary public.
(B) This course of study and examination required by subparagraph (A) shall be in addition to, and not in lieu of, the course of study required by paragraph (3) of subdivision (a) of Section 8201.
(C) The Secretary of State may provide an online notary public education course of study. If the Secretary of State does not provide an online notary public education course of study, the Secretary of State shall review a course of study proposed by any vendor and shall prescribe by regulation the application form and the certificate of approval form in the same manner as set forth in Section 8201.2. Any approved course of study shall include a required examination that shall be satisfactorily completed by the applicant prior to registration. The Secretary of State may provide an online notary public education course of study.
(c) An online notary public shall notify the Secretary of State when he or she applies to be appointed as a notary public, seeks reappointment, or enters into a new contract as to which third-party vendor online notarization platform he or she is registered with or will be using.

8231.5.
 (a) An online notary public is a notary public for purposes of Article 1 (commencing with Section 8200) and is subject to Article 1 to the same extent as a notary public appointed and commissioned under Article 1, unless otherwise expressly provided in this article.
(b) An online notary public may perform notarial acts provided by Article 1 (commencing with Section 8200) in addition to online notarizations provided in this article.
(c) An online notary public physically located in this state may perform an online notarization that meets the requirements of this article and the rules adopted by the Secretary of State pursuant to this article for a principal who is located in any of the following places:
(1) In this state.
(2) Outside this state but within the United States.
(3) Outside the United States if the online notary public has no actual knowledge that the act is prohibited in the jurisdiction in which the principal is physically located at the time of the act.
(d) (1) A requirement that a principal appear before or in the presence of the online notary public may be satisfied by means of audio-video communication with an online notary public that meets the requirements of this article and any of the rules adopted by the Secretary of State pursuant to this article.
(2) Audio-visual communications with an online notary public meets the requirements of this article if it consists of continuous, synchronous audio and video feeds with adequate clarity such that all participants can be clearly seen and understood at all times. The online notary public may terminate the session at their discretion if, in the online notary public’s judgment, the adequacy of communications is insufficient for all participants to be clearly seen and understood at all times.
(e) A requirement under Section 8205 that a certificate of acknowledgment or proof, or a deposition, affidavit, oath, or affirmation, or certification of a copy, be signed in the notary public’s own handwriting, is satisfied by an electronic signature.

8231.6.
 (a) An online notary public shall keep one or more secure electronic journals to record each online notarial act performed by the online notary public pursuant to this article.
(b) For notarial acts performed pursuant solely to Article 1 (commencing with Section 8200), an online notary public may maintain either an electronic journal pursuant to this section, or one active and sequential journal pursuant to paragraph (1) of subdivision (a) of Section 8206, or both.
(c) The electronic journal shall be in addition to, and apart from, any copies of notarized electronic records that may be in the possession of the online notary public and shall include all of the following:
(1) The date, time, and type of each official act. The time entered shall be the time at the notary’s location at the time of the online notarial act.
(2) The physical location of the principal as represented to the online notary public by the principal at the time of the online notarial act.
(3) The character of every electronic record sworn to, affirmed, acknowledged, or proved before the online notary public.
(4) Whether the notarial act was an online notarial act pursuant to this article or a notarial act pursuant to Article 1 (commencing with Section 8200).
(5) The electronic signature of each person whose electronic signature is being notarized.
(6) Satisfactory evidence of identity of the principal whose acknowledgment, oath, or affirmation was taken pursuant to subdivision (b) of Section 8231.8, which shall be in the form of:
(A) A notation of the type of identification credential provided to the online notary public for credential analysis, a record of the identity proofing, and other information as may be required by the Secretary of State.
(B) The name of each credible witness swearing to or affirming the person’s identity and, for each credible witness, a description of the type of credential provided to the online notary public and any other information required by the Secretary of State.
(C) A notation of the public key certificate or other means of identity proofing pursuant to paragraph (3) or (4) of subdivision (a) of Section 8231.8, if any.
(7) The fee, if any, charged for the online notarization.
(d) The online notary public shall maintain a recording of an online notarization that is the basis for evidence of identity and a notation of the type of credential presented as evidence pursuant to the rules adopted by the Secretary of State. The recording shall be in addition to, and apart from, the electronic journal, and the online notary public shall take reasonable steps to protect the recording from unauthorized use.
(e) The requirements of subparagraph (G) of paragraph (2) of subdivision (a) of Section 8206 do not apply to an online notarial act.
(f) The online notary public shall keep the online notary public’s electronic journal in a secure manner under the direct and exclusive control of the online notary public. The electronic journal may be maintained on a storage device or online media that is accessed by the online notary public with a password or other secure means of authentication. The online notary public shall not allow another person to use the online notary public’s electronic journal. The online notary public shall maintain a backup of the electronic journal and protect the journal from unauthorized use.
(g) An online notary public shall immediately notify all appropriate law enforcement agencies and the Secretary of State of the loss, compromise, theft, vandalism, or use by another person of the online notary public’s electronic journal.
(h) An online notary public who resigns, is disqualified, is removed from office, or allows his or her registration as an online notary public to expire without obtaining a renewal reappointment within 30 days shall, pursuant to Section 8209, within 30 days deliver the electronic journal to the clerk of the county in which the online notary public’s current official oath of office is on file.

8231.7.
 (a) An online notary public shall take reasonable steps to ensure that any registered device used to create an electronic signature or electronic seal is current and has not been revoked or terminated by the device’s issuing or registering authority.
(b) Notwithstanding Section 8207, when an online notary public’s electronic signature is required to be accompanied by an online notary public’s electronic seal, that requirement is satisfied if the electronic seal of the online notary public contains all of the following:
(1) The name of the online notary public.
(2) The Great Seal of the State of California.

(2)

(3) The words “Online Notary Public.”

(3)

(4) The name of the county where the bond and oath of office of the online notary public are filed.
(5) The date the notary public’s commission expires.

(4)

(6) The sequential identification number assigned to the online notary public, if any. public.

(5)

(7) The sequential identification number assigned to the manufacturer or vendor of the online notary public’s electronic seal.
(c) A manufacturer or vendor of the online notary public’s electronic seal shall apply to the Secretary of State to be assigned an identification number, through an application process prescribed by the Secretary of State. The electronic seal shall meet the requirements of this article and any rules adopted by the Secretary of State.

(c)

(d) An online notary public shall keep the online notary public’s electronic signature and electronic seal in a secure manner under the direct and exclusive control of the online notary public. For purposes of this subdivision, the electronic signature and electronic seal may be kept on a storage device or online media that is accessed by the online notary public with a password or other secure means of authentication and protected by the minimum-security requirements as set forth by the Secretary of State. The online notary public shall not allow another person to use the online notary public’s electronic signature or electronic seal. Failure to secure the electronic signature and seal shall be cause for the Secretary of State to take public administrative action against the commission and registration held by the online notary public pursuant to Section 8214.1.

(d)

(e) An online notary public shall attach or logically associate the online notary public’s electronic signature and seal to an electronic online notarial certificate of an electronic record in a manner that is capable of independent verification and makes evident any tampering or subsequent change or modification to the electronic record that has occurred.

(e)

(f) An online notary public shall immediately notify all appropriate law enforcement agencies and the Secretary of State of the loss, compromise, theft, vandalism, or use by another person of the online notary public’s electronic signature or electronic seal.

8231.8.
 (a) In performing an online notarization, an online notary public shall verify the identity of a principal by satisfactory evidence that meets the requirements of this subdivision and the rules adopted by the Secretary of State. For purposes of this subdivision, “satisfactory evidence” means the absence of information, evidence, or other circumstances that would lead a reasonable person to believe that the principal is not the individual he or she claims to be and any one of the following:
(1) The oath or affirmation of a credible witness personally known to the online notary public or of two credible witnesses that meet the requirements of Section 1185 of the Civil Code.
(2) All of the following:
(A) Remote presentation of a credential by the principal.
(B) Credential analysis of the credential described in paragraph (A).
(C) Identity proofing of the principal described in paragraph (A).
(3) A valid public key certificate that conforms with standards adopted by the Secretary of State by rule.
(4) Any other identity proofing method that conforms with standards adopted by the Secretary of State by rule.
(b) The online notary public shall take reasonable steps to ensure that the audio-video communication used in an online notarization is secure from unauthorized interception.
(c) The electronic online notarial certificate shall include a notation that the notarization is an online notarization. An electronic online notarial certificate shall be in the following form:
(1) For an acknowledgment:
State of California
County of __________________________
Online Notarial Act
On ________ ______, 20____, before me, __________________________________(here insert name and title of officer), personally appeared _______________________________ by means of audio-video communication, who proved to me on the basis of satisfactory evidence to be the person(s) whose name(s) is/are subscribed to the within electronic record and acknowledged to me that he/she/they executed the same in his/her/their authorized capacity(ies) and that by his/her/their signature(s) on the electronic record the person(s), or the entity upon behalf of which the person(s) acted, executed the electronic record.
I certify under PENALTY OF PERJURY under the laws of the State of California that the foregoing paragraph is true and correct.
WITNESS my hand and official seal.
Electronic Signature___________
Electronic Seal ____________
(2) For a jurat:
State of California
County of __________________________
Online Notarial Act
Subscribed and sworn to (or affirmed) before me this ____ day of _____, 20__, by ____________________________________, proved to me on the basis of satisfactory evidence to be the person(s) who appeared before me by means of audio-video communication.
Electronic Signature___________
Electronic Seal ____________
(3) For a proof of execution by a subscribing witness:
State of California
County of ________________________
Online Notarial Act
On ________ ______, 20____, before me, __________________________________ (here insert name and title of officer), personally appeared _______________________ (name of subscribing witness) by means of audio-video communication, proved to me to be the person whose name is subscribed to the within electronic record, as a witness thereto, on the oath of ______________________________ (name of credible witness), a credible witness who is known to me and provided a satisfactory identifying credential.
_________________ (name of subscribing witness), being by me duly sworn, said that he/she was present and saw/heard ____________________ (name(s) of principal(s)), the same person(s) described in and whose name(s) is/are subscribed to the within, attached, or logically associated electronic record, in his/her/their authorized capacity(ies) as (a) party(ies) thereto, execute or acknowledge the same, and that said affiant subscribed his/her name to the within, attached, or logically associated electronic record, as a witness at the request of ____________________ (name(s) of principal(s)).
WITNESS my hand and official seal.
Electronic Signature___________
Electronic Seal____________
(d) The certificate for a copy certification of a power of attorney performed by means of audio-video communication shall include the representations required under subdivision (c) of Section 4307 of the Probate Code.

8231.9.
 An online notary public may charge a fee in an amount not to exceed twenty-five dollars ($25) for any of the acts authorized under subdivisions (a), (b), and (e) of Section 8211.

8231.10.
 (a)Except as provided by subdivision (b), an online notary public whose commission to perform notarial acts terminates An online notary public who resigns, is disqualified or removed from office, or allows his or her registration as an online notary public to expire without obtaining a reappointment, within 30 days, pursuant to Section 8209, shall destroy the coding, disk, certificate, card, software, or password that enables electronic affixation of the online notary public’s official electronic signature or seal. The online notary public shall certify compliance with this subdivision to the Secretary of State in the manner prescribed by rule by the Secretary of State.

(b)A former online notary public whose commission to perform notarial acts terminated for a reason other than revocation or a denial of renewal is not required to destroy the items described by subdivision (a) if the former online notary public is recommissioned as an online notary public and registered as an online notary public with the same electronic signature and electronic seal within three months after the former online notary public’s former commission terminated.

8231.11.
 (a) The Secretary of State may approve registrations of online notaries public for the military and naval reservations of the Army, Navy, Coast Guard, Air Force, and Marine Corps of the United States that are located in the State of California. Such registrants must meet the requirements of Article 1 (commencing with Section 8200) in addition to the requirements of this article.
(b) Notwithstanding Section 8203.2, an online notary public approved for registration under subdivision (a) may perform notarial acts for principals who are stationed at the reservation for which that online notary public was appointed, regardless of whether the principal was physically located on the reservation at the time of the notarial act.
(c) Notwithstanding Section 8203.5, the electronic online notarial certificate by an online notary public shall contain the name of the reservation for which the online notary public was appointed and where the principal for which the online notarization was performed was stationed at the time of the online notarial act. A notation in the following form shall be sufficient for purposes of this subdivision:
State of California Online Notarial Act
Military Reservation of ________

8231.12.
 A person who, without authorization, knowingly obtains, conceals, damages, or destroys the certificate, disk, coding, card, program, software, or hardware enabling an online notary public to affix an official electronic signature or electronic seal is guilty of a misdemeanor.

8231.13.
 This article shall become operative on July 1, 2019. January 1, 2020.

SEC. 4.

 No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.