ORDER OF THE
DEPARMENT OF FINANCIAL INSTITUTIONS
The Department of Financial Institutions by this order creates ch. DFI-CCS 25 related to notaries public and notarial acts. This order is issued pursuant to section 80 of 2019 Wisconsin Act 125, which authorizes the Department to promulgate these rules as emergency rules and eliminates several steps from the normal emergency-rule promulgation process under s. 227.24, Stats., as described in paragraph 3 of the analysis below. ______________________________________________________________________________
ANALYSIS
1. Statutes interpreted: Chapter 140, Stats. 3. Explanation of agency authority: The Department of Financial Institutions commissions and regulates notaries public of this state under Chapter 140, Stats. Section 140.27 authorizes the Department to promulgate administrative rules to implement Chapter 140, including rules establishing maximum fees for performing notarial acts for remotely located individuals; ensuring the integrity of notarial acts for remotely located individuals and preventing fraud or mistake; and prescribing the process for granting and restricting commissions. Section 140.145(8) further authorizes the Department to promulgate administrative rules relating to the performance of notarial acts for remotely located individuals. Section 80 of 2019 Wisconsin Act 125 authorizes the Department to promulgate these rules as emergency rules under s. 227.24, Stats., and further eliminates several steps from the normal emergency-rule promulgation process, as follows: Notwithstanding s. 227.24 (1) (a), (2) (b), and (3), the department is not required to provide evidence that promulgating a rule under this subsection as an emergency rule is necessary for the preservation of the public peace, health, safety, or welfare and is not required to provide a finding of emergency for a rule promulgated under this subsection. Notwithstanding s. 227.24 (1) (e) 1d., the department of financial institutions is not required to prepare a statement of scope of the rules promulgated under this subsection. Notwithstanding s. 227.24 (1) (e) 1g., the department of financial institutions is not required to present the rules promulgated under this subsection to the governor for approval. 4. Related statutes or rules: Notaries public and notarial acts are governed by Chapter 140, Stats. 5. Plain language analysis:
These administrative rules implement 2019 Wisconsin Act 125, which revises state law governing notaries and notarial acts and authorizes notaries public to perform notarial acts for remotely located individuals using approved communication technologies. They are intended to provide clarity to notaries public and enable the flexibility of remote notarization while ensuring the integrity of the notarial process. They also take advantage of the expertise of the newly created remote notary council, a body unique to Wisconsin, to evaluate remote online notarization platforms and providers and ensure that Wisconsin notaries are using providers that implement state-of-the-art safeguards to minimize the risk of fraud or mistake. The rules do the following:
--Create procedures to ensure that Wisconsin notaries utilize communication technologies that meet national and state standards for remote online notarizations. Under the rules, remote online notarization providers can apply for approval of their systems, processes, training programs, and safeguards. Providers that have been reviewed and approved may be utilized by Wisconsin notaries to perform notarial acts for remotely located individuals.
This is similar to the approach in place in Michigan and the emergency remote notarization procedures implemented in Iowa, as well as other states. Unlike Michigan and Iowa, however, Wisconsin can draw upon the expertise of a remote notary council newly created by 2019 Wisconsin Act 125. The rules call for the remote notary council to review a provider’s application for approval and to require the provider to appear for questions and provide any information requested by council members to aid in their evaluations. --Set a maximum fee of $25 for performing a notarial act for a remotely located individual, which is the prevailing maximum fee among those states (like Wisconsin) that have enacted statutes distinguishing between the maximum fees for in-person and remote notarizations. Locally, Minnesota and Ohio each impose a $25 maximum fee.
--Codify certain processes for granting and restricting notary commissions, including the process for making complaints against a notary public, the department’s authority to investigate those complaints, and the grounds for restricting or revoking a notary commission. The rules also clarify the types of prior offenses that are disqualifying when applying for a notary commission and authorize the department to use email as the primary means of providing notices to notaries and notary applicants.
6. Summary of, and comparison with, existing or proposed federal regulation:
Not applicable. The commissioning and regulation of notaries public is a matter of state law.
7. Comparison with rules in adjacent states:
Michigan has had a remote online notarization statute in effect since early 2019. Its Secretary of State is required to review whether communication technology providers meet the state’s standards for identity proofing, credential verification, records retention, training for notaries public, and other safeguards that overlap those set forth in 2019 Wisconsin Act 125. State notaries public are permitted to perform remote online notarizations using communication technology providers. Michigan has not adopted separate administrative rules for remote online notarization, though its Secretary of State has issued official guidance to notaries. It has not set a distinct maximum fee for a remote notarization; all notarizations in that state are subject to a $10 maximum.
Minnesota also has not adopted separate administrative rules, though its remote online notarization statute largely mirrors the standards and requirements of 2019 Wisconsin Act 125. Minnesota sets a $25 maximum fee for a remote notarization. Iowa’s remote online notarization statute (SF 475) has not yet taken effect, and it has not yet promulgated administrative rules. The statute is silent on maximum fees for a remote notarization but contains substantially similar requirements for notarial acts as 2019 Wisconsin Act 125. Illinois does not yet have a remote online notarization statute, but it has adopted emergency guidelines that permit remote online notarizations via live audio and video feed without extensive or standardized procedures for identity-proofing and credential verification. Illinois has not set a distinct maximum fee for a remote notarization.
8. Summary of factual data and analytical methodologies:
The proposed changes are based on staff input on practices and procedures in administering the commissioning and regulation of notaries public in this state, as well legal counsel’s review of 2019 Wisconsin Act 125 and substantially similar statutes and administrative rules governing remote online notarization in all states that have permitted it. 9. Analysis and supporting documents used to determine effect on small business:
Small businesses are not affected by these rules.
10. Anticipated costs incurred by private sector:
No additional costs are anticipated to be incurred by the private sector as a result of these rules.
11. Effect on small business:
Small businesses are not affected by these rules.
12. Agency contact person:
Jennifer Booker
Director, Bureau of Uniform Commercial Code, Notary and Trademarks
Division of Corporate and Consumer Services
Department of Financial Institutions
