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| Kim Gale |
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| Jessica Campolucci |
In this article, we will delve into the essential components of these regulatory changes, aiming to provide a simple yet comprehensive understanding of their implications within the legal profession.
Why virtual verification?
In an era where digital advancements intersect with everyday life, the LSO recognizes the need for enhanced security and efficiency in all areas of law. The move to virtual verification is driven by a desire to combat money laundering, mortgage fraud and identity fraud, which pose significant risks to the legal profession, especially in this post-COVID era.
When should I verify?
Identity verification of a client, third party or individual authorized to give instructions on behalf of an organization becomes required in various financial transactions, specifically when you are retained to provide legal services and you engage in or give instructions involving the receipt, payment, or transfer of funds. There are exemptions to this rule (s. 22(2) – (4) of by-law 7.1 under the Law Society Act). Some examples of when verification is required are when sending or receiving settlement funds or when dealing with certain real estate transactions. Note that whenever you are receiving funds for fees and disbursements from a client, verification is not required.
The importance of authentication
Lawyers and paralegals are now required to authenticate an individual’s government-issued photo ID when using video conference or other virtual communication methods to verify their identity. Simply comparing the photo ID to an individual on a screen won’t cut it anymore — a more digital, accurate process is now required.
How can I authenticate?
Lawyers and paralegals will need to meet with the individual virtually and employ two main methods for virtual authentication:
- Scanning with technology: Individuals scan their government-issued ID using a mobile phone or electronic device; and
- Comparing features: Technology is utilized to compare various features and security elements of their ID, ensuring its legitimacy.
Technology at your fingertips
To use these two main methods, The Digital Identification and Authentication Council of Canada (DIACC) has compiled a directory of products that use biometric facial scans and government-issued IDs for verification.
For ease of reference, here are a few authentication technology platforms that may suit your needs:
Note that each platform may have their own processes and costs associated. Some solutions even integrate with certain legal software, such as Clio, and real estate applications, which can help with data storage. It is advisable to thoroughly review each platform to identify one that aligns with your specific needs.
Alternative methods for virtual verification
Digital changes can be overwhelming for some. If virtual verification doesn’t work for you (or your clients), there are three alternative methods for remote identity verification:
- Credit file method: Rely on information in an individual’s Canadian credit file that has been in existence for at least three years.
- Dual process method: Use any two of three pieces of information from a reliable source containing the individual’s name and address, name and date of birth or name which confirms they have a deposit account, credit card or other loan amount with a bank.
- Agent method: Have an agent meet with the individual to verify their identity through a written agreement.
No matter what method you choose, be sure to record the method used, along with the date.
Final thoughts
In summary, the LSO’s virtual verification requirements signify a progression in the legal profession. By embracing technology, the legal community can address emerging risks while ensuring accessibility and efficiency. However, it’s crucial to consider the potential impact of these changes on clients, especially in areas like estate litigation, where the average client demographic may be older. The introduction of new, virtual technologies might not always be appropriate and could pose difficulties. In some cases, choosing not to adopt virtual verification and opting for in-person methods or alternative virtual practices might be more appropriate.
As discussed, before using any virtual verification practice, be sure to thoroughly review all available software options. For more information and resources on the virtual verification process, review the LSO’s website and all application rules and by-laws.
Kim Gale is an estate litigation lawyer and principal of Gale Law, an estate litigation firm in Toronto. She can be reached at 416-868-3263 or kgale@galelaw.ca. She is the author and creator of the blog Law for Millennials — The Complete Beginners Guide to Law and is co-founder of diversity and inclusion group NCA Network. Jessica Campolucci is a Canadian graduate who obtained her degree in Business Management from York University in Toronto, ON and is a 2023 graduate of the Paralegal Education program at Humber College in Toronto. She is currently a licensed paralegal with the Law Society of Ontario. As a paralegal at Gale Law, Jessica assists on all issues related to estates, and has also assisted clients in matters before the Small Claims Court and administrative tribunals.
The opinions expressed are those of the author(s) and do not necessarily reflect the views of the author’s firm, its clients, LexisNexis Canada, Law360 Canada, or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice.
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