Scammers, con artists and imposters have a way of hacking into others’ minds for personal gain just as the tech criminal hacks into computers. We want to trust others but trusting your own instincts is best.
Notaries have always been an important line of protection against fraud. And no matter how technologically advanced society becomes, your instincts and actions are still the best defense against the daily barrage of scammers, con artists and corner cutters.
Every Notary needs to look out for those rare instances when someone tries to pull the wool over your eyes or get you to do something you shouldn’t. But when they do, scammers will use any number of tricks and strategies to try to dupe or manipulate you into doing one of four things:
- Notarizing a document without the signer being present.
- Notarizing the signature of an imposter by failing to properly identify them.
- Notarizing a signature of someone who is unaware of what they are signing or being pressured to sign.
- Giving the scammer access to your Notary seal and/or journal records.
Most scams target high-value transactions such as real property transfers, mortgages, estate documents and powers of attorney. If you fall for one of these scams, the consequences can be enormous, not just to the victims of the scam, but to yourself.
To understand the risks and how to deal with them, here are 5 scenarios to illustrate how dishonest people try to trip Notaries up.
The demanding boss
Most Notaries get their commissions as a requirement of their jobs. Notarizing at work can present special challenges, particularly if your boss is demanding and views your Notary seal and journal as company property. While this predicament isn’t technically a scam, it can land you in just as much trouble if you’re not careful.
Imagine you work in a law office, and your attorney boss insists that you leave your Notary seal and journal in a locked drawer to which you both have keys. You don’t want conflict with your boss, and you don’t think it will do any harm if he has access to your Notary tools.
Then suddenly, several clients file lawsuits over improper court filings and diverted assets. But you never notarized the documents in question. Either your boss or someone he directed used your seal. Your boss ends up disbarred, and you face disciplinary proceedings from the Secretary of State’s office and a claim against your bond.
Dealing with bosses and co-workers can be tricky. They often don’t understand the duties and responsibilities of a Notary and expect you to cut corners for the convenience of customers or their own purposes. But your Notary seal is yours and must be kept in your exclusive control at all times — even if your employer paid for your commission. This is only one issue that can come up at work. It is your job to respectfully educate your employer and co-workers about all your duties, such as requiring personal appearance and properly identifying all signers.
The sneaky spouse
Marital discord can lead to all kinds of shenanigans between estranged spouses. One of the most common scams involves one spouse forging the name of the other spouse on loan documents. But scams can also involve something more personal: child custody.
In this scenario, you’re approached by a long-time neighbor as you’re about to leave for work. She’s supposed to fly to Argentina that day with her two daughters to visit relatives. Her husband signed a permission letter allowing her to take their daughters out of the country without him. She says the only problem is that they didn’t realize it needed to be notarized, and he is out of town on business. She begs you to notarize the signature on the letter.
You know you’re not supposed to do it because the husband is not present, but you’ve known your neighbors for years, and your children have grown up with theirs. You’ve regularly socialized with them. So you make an exception. What could it hurt?
But when the husband returns, you discover that they are divorcing, and the wife forged his signature on the permission letter to take their daughters out of the country to deny him custody.
As much as you want to be a good friend and neighbor, you must always require the signer to appear before you at the time of the notarization.
The real estate thief
Real estate fraud can occur in any number of ways. Notaries often get tripped up when the scammer is somebody they know at least casually.
Imagine that you work in an office building. You’re acquainted with the man who works down the hall in an insurance brokerage. You only know him as “Tom,” and you share chitchat when you encounter him in the elevator or in the hall.
One day just before quitting time, Tom asks you to notarize several documents for a real estate deal. He signs them as “James T. Wilson” and explains that his middle name is Thomas and he’s always gone by “Tom.”
He says he forgot his wallet, “but you know me.” He promises to bring his ID tomorrow. Then he changes the subject to ask about your recent vacation. Then your kids. As you chat, he pulls your journal around and takes out a pen to sign the entries for his notarizations. That’s when he realizes he forgot another document and reaches into his briefcase for it, but a bunch of papers fall out. You help pick them up.
Then he notices the time and says he has to pick up his kids. You do, as well, so you finish notarizing the documents. He grabs them and hurries out.
It isn’t until the next day that you realize he never signed the journal entries. And you stop seeing him in the building. Months later, you get contacted by law enforcement and find out that Tom pulled a mortgage fraud scam. Then you’re served with a lawsuit.
In this case, Tom exploited a very casual relationship to get you to forgo proper identification procedures. And he distracted you so that you didn’t notice that he failed to sign your journal.
The best way to handle this situation is to follow the same notarization procedure every time, and proceed slowly and carefully. Never let anyone rush or distract you. And before you finish the notarization, review everything to make sure every step was followed properly. Always verify the signer’s identity at the time of the notarization.
The elder abuser
Elder financial abuse is an all-too-common issue today as baby boomers reach their golden years. And it often requires the unwitting assistance of a Notary.
Imagine you’re called to the home of a man in his 80s. A young woman answers the door and says she’s the man’s granddaughter. The man makes his way into the living room using a walker. He asks who you are. His granddaughter reminds him you’re there to notarize “those papers we talked about.”
The man thinks a moment, then says, “Do I really have to?” The granddaughter helps him to a table where he signs a power of attorney authorizing her to handle his financial affairs. You complete the journal entry, notarize the document and leave.
You later find out the granddaughter used the power of attorney to drain the man’s financial assets, and now other family members have filed a lawsuit against you claiming the man was coerced and pressured into signing.
This is a tough situation, but in this case there was a warning sign. You’re not a trained medical or mental health professional, but you should still pay attention to indications, no matter how small, that a signer might not want to go through with a transaction.
Engage the signer in a friendly conversation, introduce yourself, ask them to explain what they want. If someone else answers your questions or prods the signer, that could be a red flag. If you are unsure that your signer wants to do this, your state’s laws may require or permit you to refuse the notarization. If your state’s laws are silent on the matter, the best practice is to refuse the notarization. In any event, make a note in your journal of the situation and the steps you took.
The unknown imposter
While many scammers approach Notaries they know, others target strangers, particularly if they work in busy environments.
In this scenario, imagine a well-dressed man asks you to notarize his signatures on several grant deeds for investment properties he owns. He hands you his driver’s license, and you write down the information in your journal. But you do not compare the photo and description on the ID with the signer. He signs the entries. You complete the notarizations. He pays your fee and leaves.
Sometime later, you’re visited by federal investigators, who inform you that the man was an imposter involved in a multimillion-dollar mortgage fraud scheme. And that’s just the beginning of your trouble.
Notaries often spend more time recording information from the ID than checking and comparing the ID to the client. But verifying a signer’s identity is a crucial responsibility. Failing to do so is a common reason claims are filed against Notaries. So always make sure to pay attention to the details on the ID and compare them to the signer.
All of these scenarios are drawn from real-world situations. But they all can be avoided as long as you follow all the essential steps of a proper notarization every single time. Cutting corners is a recipe for disaster.
Related Articles:
Duping Notaries: The tricks fraudsters use
4 lawsuits, 4 lessons in Notary liability
Additional Resources:
The Notary Public Code Of Professional Responsibility