Posted by ikando on 11/9/11 8:11am
Msg #403226
More requests for background checks
I’m noticing more and more requests from SS/lenders for background checks, many specifying it be done through NNA. My question is: Why?
Considering that the notary has no input as to the numbers or validity of the paperwork, what control does s/he have that might require a BC? True, the client’s personal information is available to that notary, but let’s flip the coin.
Does the hiring company have background checks on each of their employees? I would hazard to guess, no. Each of those employees receives pay for office work which does not entail travel to accomplish, but does include preparation of documents using the same information the notary receives. Further, those employees have the ability to manipulate the information provided by the borrower, i.e., income levels, names, etc., thus having some control over the funds. Those options are not available to the notary.
The notary is frequently the only person the signer sees, therefore able to be identified should there be any issue. The notary goes into the personal space of that signer, ostensibly a safe environment, but potentially not. The notary gets paid the least amount, and last.
The notary generally does not ask for a credit report (or require it be paid for by the hiring entity), before taking the assignment. The notary shoulders all the hazards of weather and other issues, yet we are the ones required to obtain (and pay for) background checks from specific providers of that service. What is done with those checks when the requesting company receives them? Again, I would guess—nothing. Probably put in a file to say, “Yes, we got one.”
Besides, having a background check only produces a snapshot of information available on a person at a particular point. If a person is considering nefarious activity, that won’t show up until after it is done and processed through the system. And no incompetence, ignorance or laziness of a notary doing the job they’re hired to do will show up in a background check.
So, to any lenders or SS who read this forum, please tell me why you “require” a notary background check.
| Reply by LisaWI on 11/9/11 9:04am
Msg #403229
And may I add, the fact that every single time you give "your" personal information to one of these companies, you also open up the potential of your identity being compromised.
Also, not sure if all states participate and to what extent, but dont Notaries receive a BGC when applying to become a Notary? Which in my opinion is one step further than an employee at some of the SS's. Or even the SS owners for that matter.
So I would like to know if the lenders are requiring the SS's, everyone that works there, to have a BGC.
| Reply by Lee/AR on 11/9/11 9:09am
Msg #403230
Exactly right! Why? n/m
| Reply by jfs/IL on 11/9/11 9:10am
Msg #403231
I'm onboard with you folks!!
Too much asked and too easy for identity theft these days!!!!!!
| Reply by MW/VA on 11/9/11 10:29am
Msg #403237
This has been discussed many times before. You
can thank XYZ for aggressively marketing bgc's to companies. IMO it isn't legal to require their bgc. You can get a good here on NR & it isn't all that expensive. Like it or not, bgc's are being required in many fields these days.
| Reply by Jillian Hinrichs on 11/9/11 1:12pm
Msg #403273
Why a background check is requested
Personally, before I became a notary and had a refi on my house, I was glad that the Notary said she was NNA Certified and Background-Screened. It made me feel better about her handling documents that contained personal information about my husband and me.
Now that I am a notary, I am NNA certified and background-screened.
For those of you who have been around a long time, this is being requested more and more due to the Interagency Guidelines published in the Federal Register on Feb. 1, 2001, concerning the Gramm-Leach-Bliely Act of 1999, which was enacted to help protect the personal financial information of consumers.
Per the NNA NSA course book: "Thus, bank regulators interpreted the Guideline as applicable to independent Notary Signing Agents who had access to the personal financial information of borrowers. Consequently, lenders began to ask title companies and signing services providing Notary Signing Agents for closings to ensure that these Agents were background screened. Some lenders even informed companies that they would no longer use their services if they did not require Agents to be screened. Affected companies began to modify their intake procedures to incorporate the requirement and Agents began to comply."
| Reply by Saul Leibowitz on 11/9/11 1:20pm
Msg #403275
Re: Why a background check is requested
Jillian is right; it is GLB that pushes this forward. Yes, the lender may not have BGC's on all its employees, but it is the sharing of information with someone they don't employ directly that makes this BGC necessary. ALL the TC's that employ me need the BGC and most of the SS's have also requested the BGC.
NNA check, NotRot check, some others are acceptable.
Yes, it is a snapshot good up to a certain point in time, but so is today's EKG or other medical test.
| Reply by Lee/AR on 11/9/11 1:23pm
Msg #403276
Re: Why a background check is requested
You've got this backwards. The Gramm-Leach-Bliley Act was passed in 1999, as you said. No lenders had any problem with notaries not being background checked until about 2006-7, which was precisely when a certain national organization started up their excellent propaganda machine creating both the supposed 'problem' and, wowie, imagine this... also the 'cure' which they then targeted at both Notaries and the companies that hire them.
| Reply by Saul Leibowitz on 11/9/11 2:39pm
Msg #403296
Re: Why a background check is requested
Agree that GLB predates the current push for BGC and also agree that XYZ began pushing this in 2006-07 but there is more to it than that. With the industry troubles from 2008 and accelerating to current times more lenders and the title co.s and signing services that they push around have felt and been advised by legal that BGC's show compliance with GLB.
Agree that XYZ has pushed this, but the other is a very strong factor and cannot be disregarded.
| Reply by Lee/AR on 11/9/11 3:40pm
Msg #403310
I agree, to a point that ends
when they insist you 'must' obtain a certain BGC and no other is acceptable. One more thing... the industry troubles you refer to at no time ever involved a Notary Signing Agent.
| Reply by Saul Leibowitz on 11/9/11 5:56pm
Msg #403321
Lee is right
except for those few who were in cahoots with L.O.s who did the closing and then brought the docs to a notary to sign and stamp for a transaction the notary didn't witness; fortunately that was rare.
| Reply by SharonMN on 11/9/11 4:09pm
Msg #403314
Re: Why a background check is requested
I think it's very reasonable for the hiring agency to check us out a bit. I personally think listing oneself as a notary signing agent would be a great way to steal someone's identity. And even if no evil deed was contemplated, a lot of signing agents are unprofessional and clueless - why send your borrower's info to someone you know NOTHING about other than a profile on a free-listing website?
However, given that most states already background check their notaries, requiring an additional background check is redundant and also kind of pointless since they ask the notary to provide the check and therefore it could easily be doctored.
If they really cared, they (a) ask a few questions designed to find out whether or not the signing agent knows what they are doing and (b) would ask a few questions about the notary's procedures reasonably designed to protect the borrowers' confidential info. I wonder how many signing agents leave docs on computers used by their kids, throw out unused docs/printer errors without shredding them, leave docs in their unlocked car at Walmart, etc.
| Reply by LisaWI on 11/9/11 4:48pm
Msg #403315
Re: Why a background check is requested
"If they really cared, they (a) ask a few questions designed to find out whether or not the signing agent knows what they are doing and (b) would ask a few questions about the notary's procedures reasonably designed to protect the borrowers' confidential info. I wonder how many signing agents leave docs on computers used by their kids, throw out unused docs/printer errors without shredding them, leave docs in their unlocked car at Walmart, etc."
Exactly Sharon! A BGC doesnt prove if a Notary is TRUELY diligent in protecting the consumer information. It only states if they have a criminal record.....which is not wanted either but again, Notaries are BGC'd by their respective states.....
I am reading more and more about companies wanting Signing Agents to get Signing Agent E&O, higher limits for their Notary E&O, Background Checks, and Business Liability Insurance but Im not seeing that these companies are offering to raise the fees that they offer to cover those expenses.
I think some Lenders and big National Title Comps are under the impression all Signing Agents do a ton of closings a month to cover all expenses no matter where they are located even in the rural areas. I bet they figure most Notaries do anywhere from 50-100 closings per month. For all of the items above that I listed, I would have to raise my fee two-fold in order to cover the costs, maybe even more.
| Reply by BrendaTx on 11/9/11 8:21pm
Msg #403330
Texas performs a background check.
I don't need a bgc.
| Reply by ikando on 11/9/11 10:07pm
Msg #403347
Re: Why a background check is requested
Sharon, I agree wholeheartedly with your last paragraph. So, let's look at your first paragraph.
If the hiring agency wants to check out a potential employee, that company pays for the BGC. We, as notary signing agents, are going by faith when we are called out-of-the-blue and expected to immediately agree to do a job for which we may not be paid because we know nothing about the hiring agency. They are not offering to send us their credit reports. Additionally, asking us to pay for our own BGC is a burden which is not covered in the fees hiring parties are willing to offer. And, like you said, the result might be altered. Also, as others have commented, there comes a point when our own identity privacy is challenged.
The GLB has been interpreted in a couple different ways, and I believe XYZ has benefited from their own version.
| Reply by ReneeK_MI on 11/10/11 6:24am
Msg #403370
All 2 cents of my thoughts on BGC's
There are multiple reasons behind requiring or obtaining a BGC for loan signing agents ...
Not all states perform a BGC before commissioning a notary. (In MI, the counties are "authorized" by the State, but NOT required to BGC. Per a long-ago discussion by the NASS, MI only does a BGC when they determine a 'cause' to do so.)
Commissions are typically 4-6 years; a BGC is typically considered current if less than 2 years old.
Very Old Adage: If you want to know what will happen in the future, look to the past. (And then there's "History repeats itself".) Of course a BGC is not a crystal ball, nor does it guarantee that someone with a clean slate will not resort to acts of ill will - but it would be a reasonable & 'best practice' act of due diligence towards protecting the consumers.
IME, a BGC is a standard pre-employment requirement of title agencies, banks, lending institutions, etc. Again, due diligence.
IME, drug-testing and finger-printing are also standards of pre-employment screening w/in the above.
Loan officers, escrow agents, title agents, mortgage brokers & real estate agents are all licensed & regulated professions. We are not. (Summary: a BGC is the least measure of due diligence.)
IME, an employee w/in the industry who was 'clean' but gets hit with certain financial woes (judgments, liens, lawsuits, etc) can (and often will) be fired. Due diligence.
We have access to pretty much ALL a consumer's private & financial information, and often to funds. Contrary to another posting, we DO have the technical ability to edit/alter loan documents as well as using the information for ill gain.
SS's are not licensed or regulated. I don't have a clue as to whether or not the owners and/or employees are BGC'ed - though the standard E&O policy appears to be 1 mil (from what I've read in the forums). IMO, if they are receiving a consumer's information - even as a pass-through - they should be subjected to the same due diligence as 'inside' employees, in order to protect the consumer w/a minimum of due diligence.
I personally obtain a BGC every two years (from NotRot), as a means of increasing my marketability and my personally-imposed professional standard. Contrary to another posting, this BGC can NOT be altered by me and is verifiable via the website of which I have no access. This does indeed influence clients - and I am often told this by them. Therefore ...
...if clients will choose me based on that BGC, it would logically follow that it would serve SS's that same marketing edge. It may be the underlying reason for many SS's, but I'm just guessing.
Lastly, it is so unfortunate that the most renown provider of BGC's for our industry has tarnished the views of the actual BGC, within our community. BGC's IMO are a good thing - as is anything that truly serves the best interests of the consumer. Whom one chooses to use to obtain a BGC is a whole other story, but should be a separate issue.
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