On July 1, 2012, Virginia became the first state in the country to authorize remote online notarization. Legislative changes to Virginia’s notary law1 that took effect on that date allow a signer in one location to "appear" online before a notary public in another location and have his or her signature on a document notarized electronically. These changes are intended to make the notarization process compatible with today’s digital information economy.

Many states, including Virginia, already have laws authorizing electronic notarizations. But under these laws the signer must still physically appear before the notary in order to have an electronic document notarized. Virginia’s new online notary law is unique in that a signer and a notary can be located in different places. Indeed, a signer anywhere in the world may appear online before a duly commissioned Virginia notary to have his or her signature notarized.

Under traditional notary law, a notary ascertains the identity of the signer by examining such person’s state driver’s license, United States Passport, or other official identification while in the physical presence of such signer. With electronic notarization under Virginia’s new law, "satisfactory evidence of identity" may be based on audio-video conference technology (i.e., webcam) that allows the notary to communicate with and identify the signer at the time of the notarial act, provided such identification is confirmed in one of three ways.2 Such confirmation may be based on: (1) personal knowledge; (2) reliance on prior in-person identity proofing by a trusted third party (e.g., a bank, title company, law firm); or (3) a valid digital certificate accessed by biometric data or a Personal Identity Verification card issued in accordance with federal government specifications.3

In this age of cloud-computing, Virginia’s new law will promote efficiencies in the electronic storage of documents. Also, experts say that online notarization is more secure than paper-based notarizations. In this regard, the law requires a notary to keep a copy of the recording of the audio-video conference for at least five years from the date of the transaction; this will deter would-be criminals and provide critical evidence of a criminal’s identity when fraud does occur.

Most importantly, the new law provides opportunities for both cost savings (an online notary service is estimated to cost one-half of a paper-based notary process) and new revenue for financial institutions and others that routinely require documents to be notarized.