Encouraging digital identity checking in conveyancing

A few months ago I wrote about the inconvenience and inconsistency of manually verifying a client’s identity – inconvenience for both lawyers and their clients. Along with the Law Society, the Chartered Institute for Legal Executives and the Council for Licensed Conveyancers, we recognised the potential for digital identity verification tools to provide a more secure, efficient and convenient means of identifying the parties to a transaction, particularly during a pandemic. While techniques such as facial recognition against a passport are being used in several walks of life, they are not available to conveyancers as yet.

We want to do what we can to support the sector to see the development of easy-to-use, modestly-priced, remote and digitally secure options for conveyancers to use with their clients.

Ensuring you know who you are dealing with in an increasingly digital and online world is vitally important to the trust and confidence in the registration of land, and conveyancing process more generally.

After a series of events with conveyancers and identity service providers over the summer we have developed a draft set of requirements that are aimed at encouraging digital identity checks. We would welcome your feedback by close of play on Friday 11 December.

Designing the draft identity checking standard

Our virtual events to bring together conveyancers and technology suppliers helped us collect thoughts from everyone involved in the development and use of digital identity solutions. We explored what solutions were available and what the barriers were that needed to be overcome. It was apparent that there is existing usable technology that has the potential not only to meet conveyancers’ needs but to also give consumers and property businesses greater security and convenience.

Our conclusion was that a strong catalyst for the development of identity checking services aimed at the conveyancing market would be an HM Land Registry standard. We believe that a published set of requirements will provide the clarity needed to the market and best steer the investment and development.

Our objectives for the standard

Set out a clearly defined category of digital identity checking means that we believe are both achievable and viable with current technology and which offer the most security. Be clear that this is not a compulsory standard. Other means of identifying parties to a transaction may still be used. Demonstrate our confidence in the use of digital identity checks by stating that if the standard is met there will be no question that the conveyancer has done enough to identify their clients and that accordingly there is no longer any risk of HM Land Registry seeking recourse for negligence in identity checking.

Setting the requirements

A good starting point for any identity standard is the guidance set out by the Cabinet Office in Good Practice Guide 45. This is the foundation for our digital identity requirements and one that we hope can be easily interpreted by identity service providers and their customers. Ease of interpretation is important as we do not plan to manage an accreditation process for identity providers or provide lists of suitable providers to the market. Instead, we hope the brevity of the requirements will allow simple self-certification by identity providers.  

We will, of course, keep them under review after adoption, as new technologies become available that might offer more security and greater convenience.

It is our hope that, in publishing clear standards for digital identification, we support the creation of affordable and accessible digital identity services that validate an identity remotely, with a higher level of assurance than a manual intervention, in a smooth and easy to understand process for the client.

We intend for the standard to align with work the Department for Digital, Culture, Media & Sport is doing to implement an overarching framework for digital identity use across the economy.

One aspect not as yet covered in the document is how to relate a digitally identified person with a company or other corporate entity that is a party to the transaction. The identification of the individual who will be signing the transaction will be the same (requirements 1 to 3 in the standard). We are working with the Industry Forum on a variant of requirement 4 which will set out how that person is then reliably associated with the corporate entity.

The benefits of meeting the requirements

Meeting the standard will be optional. Conveyancers will be able to continue using all existing methods that meet their duty to identify their clients. However, those who can demonstrate that they have met the new standard will be protected, as HM Land Registry would not seek recourse against a conveyancer in the event their client was not who they claimed to be. That’s a demonstration of our confidence in the additional security offered by these techniques.

Offering this ‘safe harbour’ if the standard is achieved is an approach currently for a similar purpose, and one that we believe will encourage the adoption of new technology that will ultimately reduce the risk of fraud and costs, whilst also making everything easier for conveyancers and their clients.

Let us know your thoughts

We would invite everyone, particularly those who might supply and use the technology, to review the document and let us know your thoughts by close of play on Friday 11 December. All feedback will be reviewed and considered ahead of final publication – and we will explain our rationale for adopting or not adopting each suggestion when we publish.

We will continue to review the standard as new technology and measures are available to us and our customers.