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Mackay, Townsville & Cairns
28th – 30th of August 2018
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Ian Hendey Chief Practitioner Services Officer, PEXA PEXA Update
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How is PEXA’s platform transforming the industry
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PEXA’s platform is transforming the industry
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PEXA Snapshot as of August 2018
Over $175 billion worth of property value settled ~7,032 Practitioner Firms Registered Australia-wide Over 1,300,000 Property transactions completed 50%+ of all lodgements are digital via PEXA nationally ~150 Financial Institutions Australia-wide
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PEXA’s operational infrastructure to Support the Network
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Support available in your area
PEXA Direct Specialists/Virtual Specialists: Morvanna Jones depending on region Phone: Community: Sign up at community.pexa.com.au PEXA Support Centre:
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Jess Caire Purposeful Planning Market Specialist (QLD) , PEXA
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Identify – who and what? Assess – the three P’s Implement REVIEW OFTEN
BUILDING ORGANISATION READINESS CHANGE PLANNING CONSIDERATIONS The processes that will need modifying And people who will be completing the processes Identify – who and what? Impact Assessments on existing policies, procedures and people Risk assessment Assess – the three P’s Implement the changes from top down – communicate the WHY behind the change Understand and empathise with change behaviour Complete all appropriate training Change SOP’s and policies in house Implement REVIEW OFTEN For effectiveness For required changes to processes further For quality checks and adherence to new system
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ARNECC – the e-Conveyancing bible
REFER TO ARNECC GUIDANCE NOTES To implement process changes and ensure risk mitigation Refer: Put Your Text Here Put Your Text Here If you are not familiar with ARNECC – you need to read the MPR & and you can read the MOR – these give guidelines in which you must operate and also guidelines in which PEXA must operate Registrars' National Electronic Conveyancing Council (ARNECC) was formed for the purposes of co-ordinating a national approach among the States and Territories to the regulation of an electronic environment for completing conveyancing transactions. ARNECC was created to ensure a consistent national approach in the regulation of National E-Conveyancing.
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Your people and the MPR requirements
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MPR - THINGS TO CONSIDER
MPR REFERENCES ACTIONS TO TAKE TO ENSURE YOU COMPLY QUESTIONS TO ASK You must ensure user compliance Users have read and are aware of the MPR Appropriate time has been invested in training Training has been undertaken by all involved What training have you arranged? How will it be recorded? Who will do the training? How will you ensure the MPR has been read? Details of the ELNO are always complete and up to date Implement a system to ensure that all details are correct at all times Onboarding and offboarding system for new & exiting staff How often will we check details are correct? Is there a system for the Subscriber Administrator to flag a change in your business? Must comply with the Client Authorisation and act within its terms You must ensure the authority of each person entering into a Client Authorisation – this is your client’s instructions to you so that you can sign an instrument on their behalf and you can transact electronically You must consider their right to deal – take extra steps – collect copies of rates notices You must verify the client is who they say they are – ID is required How will this impact the way in which you engage your clients? What is your process if CAF isn’t signed in front of you? How will you capture additional data – right to deal & ID? What internal process will you implement to ensure reasonable steps? Must take reasonable steps to ensure that all of the information provided to the Subscriber by any other Subscriber, any Client, the Registrar or by the ELNO is protected from unauthorised use, reproduction or disclosure Ensure that IT security policies that protect access to the ELNO are implemented – password security, network access, laptop security etc What IT security is implemented? How are you collecting and storing data (VOI) How is your system protected? ( / server etc) Have you had an independent audit?
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Your responsibility as the Subscriber Administrator under the MPR requirements
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Your Responsibility under the MPR
First contact point for issues detected by the ELNO and/or the Registrar Ensure that all user details are up to date in the system 1 3 2 Ensure all of staff members authorised to use PEXA are compliant and have the right authority Notification of any unauthorised use to the ELNO and/or the Registrar 4 Maintenance of the Digital Certificates Issued – renewal of expired/replacement/lost or stolen 5 Consider here what type of policies you will implement when a staff member leaves – when a staff member is hired. Consider having your SOP’s as a fluid working document that is always updating
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Signing on the digital line
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Who can sign? Qualifications required to digitally sign on the platform are determined by Queensland Law Society/Legal Services Commission Qualifications required to digitally sign financial settlement statements are dictated by rules around trust account management (must also be an employee with signing right on the trust account with the bank) Qualifications required to digitally sign documents for lodgement are Australian Legal Practitioner (includes Locums, Contractors & Interstate Lawyers)
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General users – support staff, conveyancers, paralegals
• Staff will be required to access the platform – to maintain and manage day to day contact with other parties and the clients in a transaction • They access the ELNO to enter data, invite participants, enter and update financials as well as manage the workspace • Refer to MPR requirements – are they sufficiently trained and aware of the obligations? • Consider the processes around reporting issues and/or misuse?
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What am I certifying?
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IDENTITY EVIDENCE AUTHORITY CORRECTNESS
The Certifier has taken reasonable steps to verify the identity of the Transferor/Transferee EVIDENCE The Certifier has retained the evidence supporting this Instrument or Document AUTHORITY The Certifier holds a properly completed CAF for the transaction CORRECTNESS The Certifier has taken reasonable steps to ensure that this dealing is correct and compliant with the relevant legislation
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Your client’s identity (VOI)
The Certifier has taken reasonable steps to verify the identity of the Transferor/Transferee
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Subscriber Compliance – Identity
Verification of Identity Evidence that the VOI Standard in Sch 8 of the Participation Rules was carried out or evidence of reasonable steps No formal VOI requirements in QLD – (excluding Section 11A of the Land Title Act 1994 and s. 288A of the Land Act 1994 place an onus on ALL mortgagees) Significant fraud mitigation and consumer protection measure Consistent national requirements ARNECC MPR Guidance Note 2 Add discussion points here around storage of ID - what are you doing internally are you using the APP from an ID provider? Are you storing on a secure vault? Refer to story of screen saver
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QLS – Guidelines for E-Conveyancing
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e-Conveyancing Guidelines – CAF & VOI REFERENCE
2.5.5 Managing transactional risks Electronic settlement using PEXA requires changes to current conveyancing practice. In particular solicitors will be required to take reasonable steps to verify the identity of their client and will be authorised to sign transfer documents and direct the payment of purchase money at settlement. Solicitors should consider how the necessary changes in conveyancing practice will be managed, including verification of identity of clients, notifications within the PEXA system or a workspace related to a transaction, new time limits for undertaking tasks, liability for stamp duty, checking for data entry mistakes, confirming accuracy of certifications at the time of signing instruments and ensuring compliance with time limits for exercising client rights prior to settlement. A summary of issues a law practice should give consideration to appear below and are expanded further where relevant in the Transaction Guidelines. a. Client authorisations and Verification of Identity A solicitor must obtain a Client Authorisation (see [3.1]) prior to signing a document (except for a settlement notice and caveat) in PEXA. Prior to or at the time of obtaining a Client Authorisation, the solicitor must take reasonable steps to verify the identity of their client (QPR, clause 6.5.1). The Verification of Identity (VOI) Standard published by ARNECC Schedule 7 requires a face to face verification of identity and the production of certain original identity documents. A solicitor who complies with the VOI standard will be deemed to have taken reasonable steps in accordance with the QPR, clause Compliance with the VOI Standard is not compulsory and solicitors will need to assess the risk of non-compliance in each case where the client is unable to provide appropriate identity documents or a face to face meeting is not possible. It may still be possible to take reasonable steps to identify the client even though the VOI Standard is not satisfied. (QPR, clause 6.5.2). Refer also to [3.2]. A solicitor should note the obligation to undertake further investigation beyond the VOI Standard if an identity document is not genuine or a photograph is not a reasonable likeness or the person does not appear to be the person in the identity documents. (QPR, clause 6.5.3). QLS e-Conveyancing Guidelines – CAF & VOI REFERENCE Refer Page 10 of guide Refer to Electronic Conveyancing National Law(Queensland) 2013
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Subscriber Compliance
Right to deal Entitlement of a person to be a party to a conveyancing transaction Possession of CT, rates notice, contract Ensure client is a legal person or entity (not, for example, a superannuation fund) ARNECC MPR Guidance Note 4
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What if you can’t meet the VOI Standard?
Take ‘reasonable steps’: You have to judge what is reasonable in the particular circumstances If your client doesn’t have full documents consider an Identifier declaration, essentially a referee Do what you are able to do – if you have done all you can and you are satisfied, in the circumstances, you are likely to be acting reasonably. Options for conducting VOI: Do it yourself Use an Identity Agent IDSecure Australia Post Zip ID
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2. That you hold the appropriate authority
The Certifier holds a completed Client Authorisation for the conveyancing transaction including this Registry Instrument or Document.
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Subscriber Compliance
Client Authorisations Ensure all fields are completed Attach terms and conditions ARNECC MPR Guidance Note 1
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3. That you hold the appropriate evidence
The Certifier has retained the evidence supporting this Registry Instrument or Document.
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This is dependent on what the nature of the transaction is.
Question Answer Supporting Evidence Do you have all of the appropriate documents supporting stamp duty concessions or other items certified in the conveyancing transaction? Yes/No This is dependent on what the nature of the transaction is. Are they in order and retained for future examination in need?
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4. The correctness of what you have prepared
The Certifier has taken reasonable steps to ensure that this Registry Instrument or Document is correct and compliant with relevant legislation and any Prescribed Requirement
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Process Changes – Lexon first point of call
Examples – refer to hand book
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PAPER VS PEXA – WHAT CHANGES IN THE PROCESS?
Meet Jenny – Property Lawyer Meet Bob – her Conveyancing Assistant ACTION PAPER PEXA PEXA ROLE OPEN FILE BOB NOT IN PEXA REVIEW CONTRACT JENNY ADVICE ON CONTRACT CONTRACT CONDITIONS DRAFT TRANSFERS USER DRAFT PRIORITY NOTICE REVIEW, SEND & SIGN TRANSFERS SIGNER REVIEW, SEND & LODGE PRIORITY NOTICE BOOKING SETTLEMENT CHECK TITLE SEARCH SIGN OFF ON SETTLEMENT STATEMENT & CHEQUES SIGN OFF ON SETTLEMENT INSTRUCTIONS
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File opening checklist to create workflow
Outlines step by step process to follow, captures data at a high level view File opening checklist to create workflow PROCESS Checklist to be integrated with OS so and updated by all staff who work on file Hard copy files to have hard copy checklist Digi files to have digi copies saved in system Risk Management POLICY Refer to hand out – example only – will work depending your firm whether you are all digital – but it gives the firm a snapshot of what is occurng
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Initial Engagement letter
Now refers to the CAF, PEXA & ID Initial Engagement letter PROCESS All client to be ID’d in house using ID App and Right to deal docs saved to electronic file –CAF to be signed in house at same time as ID gathered All clients out of office must use ID Agent and have CAF signed by ID Agent Risk Management POLICY Refer to hand out – example only- consider how you will send to client – / post / pick up Refer to Lexon Offering for further samples
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Collection of ID Risk Management ID / Right to deal checklist
You will now record the Client ID Interview Collection of ID PROCESS All inhouse ID is gathered and stored on APP and the checklist is completed by the staff member who captured ID and any additional notes made. Right to deal is collected at same time Risk Management POLICY Refer to hand out – example only – again will depend on your firm and what you have decided. Will you use an AP will you store copies on encrypted vault – what is the security around that Who will you manage this data This is an example of a checklist that you could utilise – you could build it to auto pop from your operating system to get it to generate some data, Consider the process around this – and how you will store the ID
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Identify who will work in the workspace
Opening and using the workspace Workspace to be opened and invitations sent open file receipt Refer to Community to create SOP When will you sign off Who will double check figures Who will sign off and when Identify who will work in the workspace PROCESS Identify which roles are allocated to which staff and ensure stop checks in place Consider policy when a staff member leaves – removal and change of passwords Risk Management POLICY
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Bank Account Collection and Sharing
Sharing of Bank Account Info You will no longer your Trust Account or ask for clients to their bank account to you All clients are called to double check account details Bank Account details are asked for at time of engagement and checked closer to settlement Bank Account Collection and Sharing PROCESS footers are updated with warning and you notify clients in correspondence you will not send /request bank info via Phone call prior to any funds moving to confirm Where possible bank advance full proceeds /collect full proceeds Risk Management POLICY Refer to hand out – example only – again will depend on your firm and what you have decided. Will you use an AP will you store copies on encrypted vault – what is the security around that Who will you manage this data This is an example of a checklist that you could utilise – you could build it to auto pop from your operating system to get it to generate some data, Consider the process around this – and how you will store the ID
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OSR Stamping will change for eConveyancing
OSR Connect Stamping Process Refer to hand out to see process in PEXA OSR Stamping will change for eConveyancing PROCESS Identify the staff that are to stamp and the guidelines they are to follow Risk Management POLICY
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Bill Hourigan Your trust account and PEXA - Video
Queensland Law Society Your trust account and PEXA - Video
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Marijana Markovic Matt Kerr Financial Institution Update
Executive Manager – Financial Institutions, PEXA Lead - Digital Settlements, National Australia Bank Financial Institution Update Matt Kerr
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Financial Institutions Summary
150 Financial Institutions Australia-wide registered with PEXA Financial Institutions are Integrated; Workflow and Payment Integration The industry working together to ensure an efficient digital process Familiarise yourselves with the Industry Guidelines Item 3: Colloboration PROACTIVES Banks are actively driving the market to 100 % - proactive , developments, 1# - projects, proactives, education and awareness across business and front line – internal and external contacts – monthly, predicimentonly in the mandates states (VIC, NSW) Working groups - commerical branches, commercial workspe, esa / SETTLING ACCOUNT #2: reference to the guildiness, working groups, escalation contacts, relationships, community page, settling accont –MAKE REFERENCE TO INDUSTYR STUFF! Banks handling escalations directly NAB: Looking at a soft launch for their retail brand early March End of March for full launch ANZ: Already able to answer prac calls re PEXA via normal settlement phone lines WBC: IVR updated to include option for retail digital settlements went live 29 January (not communicated anywhere) Looking to extend to business banking “soon” STG: New IVR for digital setts to go live 1 Feb CBA: Potentially looking at options for opening escalation lines to pracs
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PEXA Process Overview Fast access to cleared funds with electronic settlement Safe encrypted signing and funds exchanged via the RBA Efficient settlement with real-time lodgement of documents
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Collaboration within the workspace
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Thank you for attending
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