The Land Registry promotes facial recognition tools to check property owners identities, advises Jennie Curtis
Identity fraud is a huge concern for the Land Registry, with property fraud costing it around £73.3m between 2005 and 2019. Add to that the impact on the victims of the fraud, any lenders, their solicitors and any insurers and you have a problem that concerns everyone in a property transaction (except for the fraudster!).
The Land Registry is therefore encouraging conveyancers to take their identity checks to the next level by taking advantage of the biometric data that many of us already have stored on our passports or identity cards. Current methods put the onus on conveyancers to check documents against the person, with levels of skill at this task varying between practitioners. The Land Registry has recently issued a consultation paper on what they have rather poetically entitled the “Safe Harbour Standard”, which suggests steps conveyancers can take to ensure better identity checks.
In an unusually bold statement, the Land Registry has said they will not sue those conveyancers who use the “Safe Harbour Standard” if their client later turns out to be an identity fraudster. This shows huge confidence in the system, as the Land Registry currently indemnifies victims of fraud for their loss (subject to certain exceptions) where there has been an identity fraud that leads to another person incorrectly becoming the registered owner of a property.
The Land Registry will usually seek to recover their loss from the fraudster’s conveyancer if they can show that conveyancer was negligent or fraudulent in their identity checks. So it will be a huge incentive to conveyancers to adopt this standard and reduce their risk of being sued (and potentially their insurance costs). Should the Safe Harbour Standard be adopted, it is likely that mortgage lenders will in turn be quick to make these checks a standard requirement.
At the moment, the Safe Harbour Standard is at the consultation stage, which closes on Friday 11 December 2020. The draft paper suggests that the following steps be adopted by conveyancers:-
- Obtain an identity document that includes cryptographic security features against which biometric facial recognition checks can be made. In short, a biometric passport, biometric identity card or biometric residence permit.
- Use an identity check provider to check that the identity document held is genuine. The provider will read the document chip and verify the document.
- Perform a “liveness check”, which is a fancy way of saying that a photograph or video will be taken of the actual person standing in front of your holding their documents, in order to capture that person’s biometric information. This can be a person’s face, the features of their eye or their fingerprints.
- Connect the person to the property by obtaining the usual two proofs of address. Online and postal statements may be used to verify identity.
The upshot of this is that it will be more commonplace for biometric data to be held by agencies and in government databases. It may be that some respondents to the consultation raise fears that this is an invasion of privacy, but with property often the most valuable asset owned by many in the UK, this may be a personal freedom many are willing to sacrifice if it means their asset is more secure.
As an aside, the properties most targeted by identity fraudsters tend to be properties that are routinely left vacant and are unmortgaged. If you have a vacant property that might be at risk, you can apply to the Land Registry for an additional restriction on title which requires that the conveyancer take extra checks to confirm the identity of the proprietor before selling the property. It costs just £40. Please do let us know if you have any questions or concerns and we will be happy to assist.
For further information or advice please contact Jennie Curtis.
This article is for general purpose and guidance only and does not constitute legal advice. Specific legal advice should be taken before acting on any of the topics covered. No part of this article may be used, reproduced, stored or transmitted in any form, or by any means without the prior permission of Brecher LLP.