Chairperson Humphries opened the Hearing on HB2696.

Jason Thompson, Office of Revisor of Statutes, presented the Bill Brief.  (Attachment 8)

Proponents:

Representative David Buehler, Kansas 40th District testified that Leavenworth County has piloted a method for individuals to voluntarily protect themselves from title fraud and property theft. This bill would make this option available across the state.  (Attachment 9)

TerriLois G. Todd, Register of Deeds, Leavenworth County Kansas testified that a process of biometric checks which they use could help stop notary fraud if used across the state.  (Attachment 10)

Sergeant Ky Shorb, Financial Crimes Squad, Topeka Police Department testified that this modernization of the notary public system could drastically lower the cases of notary fraud in Kansas, particularly in cases concerning elderly victims.   (Attachment 11)

Detective Joseph Kinnett, Topeka Police Department shared information concerning a stolen property case that could have been avoided had there been a check on the fraudulent notary stamp on documents. Implementation of this bill would strengthen protection for Kansas property owners.  (Attachment 12)

Chris Wright, Recorder of Deeds, Platte County, Missouri testified that he has worked with several fraud cases concerning real people who have been victims of their homes being stolen through notary fraud and accepted the challenge to do something about it. He passionately encouraged the Members to vote for this bill. No written testimony provided.  No written testimony provided.

Stephanie Becker, Region 2a Long-Term Care Ombudsman testified on behalf of an elderly citizen who believed they were scammed in an incident involving a mobile notary.  (Attachment 13)

John Taylor, Chief Executive Officer, Identifid, testified from the perspective of the technical side of notarization. Using "verified notary public" technology could stop fraud immediately by authenticating the notary stamp.  (Attachment 14)

The Chairperson drew attention to the Proponent Written Only testimonies:

Representative Timothy Jonson, Kansas 38th District  (Attachment 15)

Representative Pat Proctor, Kansas 41st District  (Attachment 16)

Andy Dedeke, Sheriff, Leavenworth County  (Attachment 17)

Charles and Paula Hyde, Private Citizens  (Attachment 18)

John T. Amrein, President Land Company  (Attachment 19)

Dan Lynch, Lynch Real Estate  (Attachment 20)

Susan Draftz, Notary and Paralegal, Private Citizen  (Attachment 21)

Michael Reilly, Broker, Reilly Real Estate  (Attachment 22)

Denise Atkins, Realtor, Keller Williams Realty  (Attachment 23)

Opponents:

Kenneth S. White, President of White Exploration, Inc., for Kansas Independent Oil and Gas Association testified that as a notary in the state he has dealt with Oil and Gas leases and land title documents being recorded in Register of Deeds offices around the state. He maintained that documents are highly scrutinized by qualified staff who understand the laws regarding the legal instruments filed in their offices, often involving buyers and sellers from different states, meaning many documents are not notarized in this state. Passage of this bill could affect everyone who needs the services of a notary.  (Attachment 24) 

Becky Nioce, Kansas Register of Deeds Association testified that the Association believes this bill raises concerns of constitutionality under the 4th Amendment of the United States Constitution, as well as the expenses to notaries and the public, out-of-state rejections, and the unfunded mandates on Kansas counties. The Association called for more immediate solutions to reducing fraud, such as ongoing standardized training for notaries, faster administrative removal of suspension of notaries who are bad actors, and stiffer criminal penalties for those who commit real estate fraud.  (Attachment 25)

Ashley Garr, Co-Chair of the Legislative Committee, Kansas Land Title Association testified that it is the business of her office to handle real estate fraud every single day. Many notarizations are from out-of-state or out-of-country. They do not oppose the idea of a statutory solution to combat real estate fraud should it be the result of discussions and compromises bade by all interested stakeholders.  (Attachment 26)

Darren Beckham, Public Policy Field Director, Kansas Realtors testified that the Kansas REALTORS would be happy to promote conversations with many different stakeholders before passing this bill.   (Attachment 27)

James Fulgenzi, Head of Public Policy, Proof, testified that his company is concerned that this bill would disrupt an already secure notarization system that Kansas adopted in 2022, it introduces cybersecurity and data governance risks that the bill does not address, and it places significant unfunded operational burdens on the Secretary of State and all 105 counties.  (Attachment 28)

The Chairperson drew attention to the Opponent Written Only testimonies:

Joe Molina, Kansas Bar Association  (Attachment 29)

Jay Hall, Deputy Director and General Counsel, Kansas Association of Counties  (Attachment 30)

Wendy Weiss, Register of Deeds, Lyon County Kansas  (Attachment 31)

Raquel Langley, Register of Deeds, Harvey County Kansas  (Attachment 32)

Missie Gerritzen, Register of Deeds, Kearny County Kansas  (Attachment 33)

Tonya Buckingham, Register of Deeds, Sedgwick County Kansas  (Attachment 34)

Sandee J. Swanson, Register of Deeds, Republic County Kansas  (Attachment 35)

Marcy Merritt, Register of Deeds, Wabaunsee County Kansas  (Attachment 36)

Audrey Anderson, Register of Deeds, Harper County Kansas  (Attachment 37)

Kelly VanZwoll, Senior Vice President Government Relations, Kansas Bankers Association  (Attachment 38)

Andrew Darrow, Chapter President, Kansas Government Management Information Systems International  (Attachment 39)

Cale Beam, Kansas Credit Union Association  (Attachment 40)

Michael Stidham, Director of Regulatory Affairs, Rocket Mortgage  (Attachment 41)

Neutral Conferees:

Clay Barker, General counsel, Kansas Secretary of State, pointed out that this office is the administrative overseer of notaries in Kansas. This bill's focus is on making sure that notaries are who they say they are for real estate transactions. He noted that this bill creates a lot of new roles for the Secretary of State. Secretary Schwab wanted to share four points: that this is a single technology solution to one type of real estate fraud, the cost estimate at this time could be $5-10 million dollars, the implementation date of December 2027 may be beyond their capability, and they would prefer to have no role in setting fees. Currently notaries set their own fees.   (Attachment 42)

Ed Klumpp, Kansas Association of Chiefs of Police; Kansas Sheriffs Association; Kansas Peace Officers Association testified that fraud and cybercrime are the fastest growing crimes in the United States.  He encouraged reading information from the National Association of Realtors provided in his testimony, as well as the Police Department testimony which tells of very devastating consequences for victims. The organizations he represents know that this type of fraud is a large problem, but this is an area out of their expertise. The solution being offered may be a good one and one to consider, but they are certainly in support of further discussion with all interested parties.  (Attachment 43)

The Neutral Conferees stood for questions.

Chairperson Humphries closed the Hearing on HB 2696.