The foreclosure robo-signing fiasco isn’t just dragging out the nation’s distressed property crisis, it’s also roiling the usually placid and obscure world of notaries.

The involvement (or lack thereof) by some public notaries in foreclosure processing mills has led to a rare presidential veto, a crackdown on lenders in New Jersey and an effort by the National Notary Association to control damage to the reputation of its practitioners.

Many people only vaguely know what notaries do.

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“As we have talked to a lot of people over the life span of this story, most of the folks we’ve spoken to are learning about notaries for the first time,” Michael Robinson, executive director of the National Notary Association, said Tuesday.

Simply, notaries are people commissioned by their states to help preserve the integrity of agreements and ensure the authenticity of transactions.

They usually do this by witnessing that a signature was willingly made, in person, and that the signer intends for the document to take effect exactly as written. For court documents, notaries require the signer to recite an oath that the statements in the documents are true, on penalty of prosecution for perjury. Notaries can also certify that document copies are exact and complete.

Robinson said notarization involves three basic tenets: the signer physically appears before the notary, the signer is aware of the document he or she is about to execute, and the signer is not coerced or exploited in any way.

This is pretty simple when you’re having your signature witnessed and getting the notary’s embossed seal of authenticity on your routine mortgage paperwork — often at a bank but possibly at a law or insurance office, UPS store or anywhere a commissioned notary is willing to do business.

But when the notary is working, say, for a lender that is trying to process 20 times its normal amount of foreclosure cases, the pressure to expedite and ease up on performance standards is great.

In a case that has figured in the controversy, a Pennsylvania notary vouched for thousands of foreclosure documents in New Jersey despite lacking a license to practice here.

What’s worse, Thomas Strain, who now heads the bankruptcy team at GMAC Mortgage Corp., has admitted to notarizing an average of 50 foreclosure legal filings a day while working at Full Spectrum Services of Mount Laurel. On many of those, he notarized signings by one of the lawyers he worked for, Frank Hallinan, despite admitting Hallinan may not have been present for the notarization, a New York Post article reported.

Pressure on notaries has become common in the economic downturn, Robinson said.

“You might be looking at your boss who’s telling you to do something that you shouldn’t be doing, in an environment of rising unemployment and other things that make it very complex,” he said.

Strain’s case figured in state Supreme Court Chief Justice Stuart Rabner’s crackdown in December on sloppy foreclosure processing.

Robinson said there have been worse instances of notary procedure abuse.

“What we’ve seen is notary’s seals and commission numbers were used outside of their knowledge,” he said.

Robinson said he would like to see states encourage or even mandate that notaries protect their seals, and keep and protect a record of their notarial activities.

Before robo-signing became widely known in the fall, federal legislation to have courts recognize notarizations made in other states sailed through Congress. That would have made processing the ocean of documents in the national foreclosure crisis much easier for banks and other lenders.

But in October, President Barack Obama exercised only his second veto so far, refusing to sign the measure and letting it expire.

The National Notary Association sees the events of the past year as an opportunity to inform the public about what notaries do. The group also wants to reinforce with notaries — about 4.8 million nationally and 200,000 in New Jersey — the importance of what they do and how they do it.

To that end, this month the group put out a white paper, “Why Notarization Is More Relevant and Vital Than Ever.”

“We’re hoping that by getting back to notarial basics, we can recalibrate the environment to re-create the trust needed in something so basic as home ownership,” Robinson said. “The robo-signing situation drives home that point much more dramatically, sort of a, ‘Wait a minute, this is serious stuff.’”

Contact Kevin Post:

609-272-7250

KPost@pressofac.com

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