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#1381400 - 04/26/10 04:03 PM E-Sign
mbernard Offline
100 Club
Joined: Jul 2008
Posts: 109
We are about to go start Online Account Opening and I have a question about E-Sign regulations that I am hoping to get some clarification on.

Is there a difference, as it pertains to E-Sign, to how the account opening disclosures are given? For example, is there a difference between the disclosures popping up in another window and being emailed to the customer? My understanding is that they are both electronic and therefore have to comply with E-Sign, including agreeing to recieve the disclosures this way, verfication, etc?

Any claification would be great! Thanks in advance.

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eBanking / Technology
#1382169 - 04/27/10 05:28 PM Re: E-Sign mbernard
Richard Insley Offline
10K Club
Richard Insley
Joined: Oct 2000
Posts: 10,056
Toano, VA
Your questions are directionally correct, but need fine tuning.

ESIGN has no implementing regulations. The Fed and other banking agencies are only permitted to interpret ESIGN when necessary to issue and maintain other regulations (such as Regs. E, DD, Z, etc.) As a result, you must look to each of these existing banking regulations for guidance, not to ESIGN.

Your first and most important concern is about the form of disclosures. Reg. E, for example, says that Reg. E's disclosures must be provided "in writing, and in a form the consumer may keep." (Sec. 205.4(a)(1))

Other consumer protection laws and regulations can (and do) have different standards for the "form of disclosures"--you must study all that apply to the products for which you plan to offer e-delivery of documents.

When disclosures must be "in writing", you have two choices: paper and electrons. As a convenience, the consumer protection regulations (Sec. 205.4(a)(1), for example) may alert the reader to ESIGN's procedure for substituting (legally) electrons for paper.

You asked if there is a difference how the account opening disclosures are given. Yes, it matters, but only to a limited extent. Sticking with Reg. E, you can see there are two considerations:
- the method you use must be sufficiently understandable so that customers can navigate your demonstrable consent "test drive", and
- customers must be able to capture and retain (in some manner or other) the content of the disclosures.
...gone fishing.

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#1382471 - 04/27/10 09:00 PM Re: E-Sign Richard Insley
mbernard Offline
100 Club
Joined: Jul 2008
Posts: 109
Thank you.

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