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#1421249 - 07/29/10 01:26 AM Online Banking and E-statements
comp123 Offline
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Two questions that I would love your input! First, to support the customer is able to view their e-statements, we have been sending an email, requiring a response that they consent to estatements and have the necessary system requirements. We do not require them to sign on to online banking and follow the link to the statements and confirm that they can view. Is the email consent enough for esign?

Second, for the customers that open an account online, we provide a link to the required disclosures (REG CC, E, etc) and they must acknowledge the disclosure by checkbox before they can complete the application process. Is this good enough or must the disclosures automatically display on the screen?

Again, thanks so much!! Sleepless nights over this lol

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eBanking / Technology
#1421274 - 07/29/10 11:19 AM Re: Online Banking and E-statements [Re: comp123]
Richard Insley Offline
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Originally Posted By: comp123
Two questions that I would love your input! First, to support the customer is able to view their e-statements, we have been sending an email, requiring a response that they consent to estatements and have the necessary system requirements. We do not require them to sign on to online banking and follow the link to the statements and confirm that they can view. Is the email consent enough for esign?

Second, for the customers that open an account online, we provide a link to the required disclosures (REG CC, E, etc) and they must acknowledge the disclosure by checkbox before they can complete the application process. Is this good enough or must the disclosures automatically display on the screen?

Again, thanks so much!! Sleepless nights over this lol

If I understand your e-delivery methods, my answers are:
No, No, and not good enough.

Asking customers to declare their capability (hardware, software, and savvy) to receive and use e-documents does not measure up to ESIGN's "demonstrable consent" procedure unless your e-statements are also sent in the body of an ordinary email message. (No comment about the security problem with that!) ESIGN requires a number of hardware/software disclosures followed by a "test drive." Each customer must pass the test drive before your e-deliveries count as "in writing."

Unless they are "in writing", Reg. E disclosures do not count. This standard applies to account opening disclosures as well as statements.
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#1421361 - 07/29/10 01:53 PM Re: Online Banking and E-statements [Re: Richard Insley]
comp123 Offline
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Thanks so much!! To make sure I totally understand, we could send an email after the new customer completes the online new account application. The email would state the hardware/software terms and requesting they follow a link provided in the email to our site where they must view the disclosures and acknowledge (email stating by doing so they are consenting to receipt of disclosures electronically.) Then also have them follow another link from the email to review a test statement and acknoweldging this would be consent for estatements.
Perhaps I am off base? for some reason this is really throwing me!

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#1421591 - 07/29/10 05:33 PM Re: Online Banking and E-statements [Re: comp123]
Richard Insley Offline
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You probably have a laundry list of all the federal disclosures you are currently delivering on paper. These are the disclosures required by Regs. E, CC, DD, etc. Are you planning to e-deliver all of these various initial, periodic, and occasional disclosures, or will some of them stay on paper? Will all e-deliveries work exactly the same way? What electronic steps will occur from the time your system(s) initiates a disclosure document until it is in the customer's hands in usable form?
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#1422309 - 07/30/10 07:19 PM Re: Online Banking and E-statements [Re: Richard Insley]
comp123 Offline
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After speaking with external examiners, it appears that we have gone a little overboard on our "consent and proof". Since the disclosures and the estatements will be in pdf format, I was told that we could have the consent agreement in a pdf form (online during the application process) and have the cusotmer consent by clicking "I consent..." Once that is done, the customer can sign up for estatements and read all required disclosures before the application process is finished. For some reason I thought since we notify the customers via email that their statement is ready to view online, we had to test that the customer could receive the email notification. Not sure I agree that we do not have to, but management is running with it.

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#1437209 - 08/31/10 08:55 PM Re: Online Banking and E-statements [Re: comp123]
Cale_N_Oats Offline
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Do we have to record their consent to receive E-statements electronically on our website or can we have them sign up for it at account opening?
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#1437293 - 09/01/10 02:12 AM Re: Online Banking and E-statements [Re: Cale_N_Oats]
Richard Insley Offline
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Section 101(c)(1)(C)(ii) of ESIGN -
[The customer must] consent electronically, or confirms his or her consent electronically, in a manner that reasonably demonstrates that the consumer can access information in the electronic form that will be used to provide the information that is the subject of the consent;

This can't be accomplished on paper.
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#1443137 - 09/15/10 01:53 PM Re: Online Banking and E-statements [Re: Richard Insley]
Cale_N_Oats Offline
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Is there any reason why we couldn't have them sign up to consent to receive an online confirmation at the bank, then we send them and email asking them to reply and consent to receiving E-statements? We wouldn't send them an E-statement until we received an email back from them, and the paper agreement they sign would state that they must consent electronically before they receive E-Statements.
Last edited by Carl Hungus; 09/15/10 02:36 PM.
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#1443238 - 09/15/10 03:33 PM Re: Online Banking and E-statements [Re: Cale_N_Oats]
Richard Insley Offline
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ESIGN requires you to do one of two things "in a manner that reasonably demonstrates that the consumer can access information
in the electronic form that will be used to provide the information that is the subject of the consent."

Option #1 is to obtain the customer's consent in the prescribed manner.
Option #2 is to confirm the customer's consent in the prescribed manner.

If you want to obtain consent at a CSR's desk with a paper document, that consent is not effective until the customer takes the "test drive" and passes. Unless you're sending statements in the body of ordinary email messages (an obvious security problem), then the act of opening an ordinary email and responding is inadequate. Your "test drive" must match the way your technology works, and to get the ESIGN seal of approval, the customer must go through the same series of steps required to receive, open, and use a live statement.
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#1443957 - 09/16/10 03:48 PM Re: Online Banking and E-statements [Re: Richard Insley]
Cale_N_Oats Offline
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Great, thanks for the clarification!
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#1444081 - 09/16/10 05:31 PM Re: Online Banking and E-statements [Re: Richard Insley]
Marnie Offline
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Slightly different question: anyone out there having customers sign up for online banking/e-statements at a terminal at the bank? We're thinking of doing this to increase perecentages of e-statement usage, by having new account sign up right away for this on bank computer. My concern is that because they are using our computer, they can't really verify the hardware requirements, and may gave demonstrable consent anyhow. Thoughts?

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#1444088 - 09/16/10 05:33 PM Re: Online Banking and E-statements [Re: Marnie]
John Burnett Offline
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Demonstrable consent is only valid if the consumer gives it in a way that demonstrates he or she can access documents of the type to be covered from his or her computer or a computer to which the consumer has regular access (at work for example). It is, to my mind, unreasonable to assume the consumer will always attempt to access covered electronic records using your bank's computer.
Last edited by John Burnett; 09/16/10 05:35 PM.
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#1444135 - 09/16/10 05:56 PM Re: Online Banking and E-statements [Re: John Burnett]
Marnie Offline
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Yes, that was my concern--"demonstrable" really translates to the device they are using. Thanks for your quick response, John.

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#1444483 - 09/17/10 02:23 AM Re: Online Banking and E-statements [Re: Marnie]
Richard Insley Offline
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If customers get into the habit of visiting bank branches to retrieve their e-statements, the next thing they'll want is passbooks! eek
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#1444583 - 09/17/10 01:47 PM Re: Online Banking and E-statements [Re: Richard Insley]
John Burnett Offline
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... or (shudder) longer hours and a web café.
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#1444957 - 09/17/10 07:18 PM Re: Online Banking and E-statements [Re: John Burnett]
Andy_Z Offline
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The smell test also asks how your customer would ever print or retain e-copies of the documents? E-statements are convenient for the customer, but not if they have to come to the bank to get them. frown
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#1445086 - 09/17/10 09:14 PM Re: Online Banking and E-statements [Re: Andy_Z]
Marnie Offline
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Coming to the bank each time was not the intent. Just to get them to sign up initially, while educating them how to use. I think the whole point to demonstable consent is based on their computer, so using the bank's to initially sign up would not prove that. Thanks to all for your comments!

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#1445093 - 09/17/10 09:21 PM Re: Online Banking and E-statements [Re: Marnie]
Andy_Z Offline
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My tongue was partially in my cheek, but in reality you wouldn't be sure they even had a PC or one available to them. You are never sure, but offering one in the bank isn't recommended, IMHO.
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#1445110 - 09/17/10 09:44 PM Re: Online Banking and E-statements [Re: Andy_Z]
Marnie Offline
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You are right, of course. Marketing is trying to increase % of e-statement usage to cut costs in postage and paper. So I am sure they will come up with a promo or bonus, then fees for paper statement, all of which I will review from a different perspective. Can't wait (tongue in cheek). Ah, job security! Thanks again.
Last edited by Marnie; 09/17/10 09:45 PM.
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#1445166 - 09/18/10 03:29 PM Re: Online Banking and E-statements [Re: Marnie]
Richard Insley Offline
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You can use bank equipment to demo the opt-in process and allay customer fears that it will be complicated. The official consent must be done on a machine of the customer's choosing, however.

We took many customers by the hand and showed them how to use our first ATMs. That wasn't anticipated, but was a necessary part of the sales effort.
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#1445621 - 09/20/10 09:47 PM Re: Online Banking and E-statements [Re: Richard Insley]
Cale_N_Oats Offline
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Is their any reason, when sending the customer a e-statement consent notification through email, that we can't attach it as a PDF for them to open?
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#1445647 - 09/21/10 12:37 AM Re: Online Banking and E-statements [Re: Cale_N_Oats]
Richard Insley Offline
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Originally Posted By: Mose
e-statement consent notification through email

Please provide additional explanation.
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#1445737 - 09/21/10 01:46 PM Re: Online Banking and E-statements [Re: Richard Insley]
Cale_N_Oats Offline
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Well the only way our bank can track electronic consent is if we send them an email of the consent notice and they reply back to the bank, " I agree with the terms of the E-statement consent notification". So, is it alright if when we email them that we provide it in a PDF form as an attachment?
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#1445806 - 09/21/10 02:42 PM Re: Online Banking and E-statements [Re: Cale_N_Oats]
John Burnett Offline
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How does your method help the consumer demonstrate that he will be able to access documents of the type he is willing to accept electronically? Unless you plan to "push" the statements out to the consumer as attachments to emails (encrypted, one hopes), sending the consent notice as an attached PDF doesn't really buy you anything that cements the E-Sign demonstrable consent, IMHO.
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#1445810 - 09/21/10 02:47 PM Re: Online Banking and E-statements [Re: John Burnett]
Cale_N_Oats Offline
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Their statements would be viewable in PDF form so if they can view the PDF consent ntoice they will be able to view their statements. PLus on the consent notice we will inform them of the hardware and software needed to view their statements and have them reply that they "consent" that they have the ability to view and would like to receive e-statements.
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#1445815 - 09/21/10 02:50 PM Re: Online Banking and E-statements [Re: Cale_N_Oats]
John Burnett Offline
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I suggest that you place the PDF document on the same server and in the same folder that the consumer is going to have to access in order to pull down his statement (assuming you're using the "pull" method). Then use your email to the customer to provide instruction on how to access the PDF file. Include information on the PDF document that the customer needs to parrot back to you in his consent, to show that he got to the PDF and could open it.
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#1446017 - 09/21/10 06:22 PM Re: Online Banking and E-statements [Re: John Burnett]
Cale_N_Oats Offline
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Sorry for being so difficult but I just want to make sure i understand what you're suggestion is. You're saying we should email them instructions on accessing the PDF through their Online Banking and within that email also ask them to respond back that they can access the document?
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#1446279 - 09/21/10 11:06 PM Re: Online Banking and E-statements [Re: Cale_N_Oats]
Richard Insley Offline
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I think the point you're missing is that it's insufficient to get the customer to declare "I have Acrobat reader and can use it to open a test document." ESIGN goes further. It requires you to test the customer's proficiency in a way that demonstrates success with all the hardware & software necessary to retrieve, open, and use the electronic documents containing the periodic disclosures (the statement.)
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#1446305 - 09/22/10 12:30 AM Re: Online Banking and E-statements [Re: Cale_N_Oats]
rlcarey Online
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"have them reply that they "consent" that they have the ability to view and would like to receive e-statements."

IMHO - having them say they have the ability to view the documents is not demonstrable consent. They haven't demonstrated anything.
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#1446899 - 09/22/10 07:49 PM Re: Online Banking and E-statements [Re: rlcarey]
Cale_N_Oats Offline
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So let me run this by you guys and see if it works. We have the customer sign up for E-statements through our server so we can track it. Then we send them an email saysing something like "Thanks for signing up for E-statements with Herrin Security Bank. We have provided a test statement for you to access on your online banking account. Let us know if you have any trouble viewing the test statment." So, they have provided us consent through our server and we have given them a way to test their system. Would this suffice?
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#1446978 - 09/22/10 09:11 PM Re: Online Banking and E-statements [Re: Cale_N_Oats]
John Burnett Offline
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Those two things are essentially correct, except they are in the wrong order. So add one thing. When you provide the access to the test statement, tell him/her to follow the instructions found there. Include in the instructions a link to a form to be used by the customer to confirm the earlier agreement for e-statements. Now you will have documented consent.
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#1446985 - 09/22/10 09:18 PM Re: Online Banking and E-statements [Re: John Burnett]
Ebankman Offline
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We do something similar to that in our environment. We send our estatements via an encrypted/password protected pdf. To get the customer to prove they can open access the pdf we do the following steps.
1 customer signs form stating they have the minimum system requirements and want estatements.
2 we send an email to them with a sample statement attached in PDF format and ask that they reply to our email with the date on that sample statement.
3 if they reply correctly we turn on estatement and begin sending the statements in pdf format to their email address.

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#1447062 - 09/23/10 02:03 AM Re: Online Banking and E-statements [Re: Ebankman]
Richard Insley Offline
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Originally Posted By: Ebankman
We do something similar to that in our environment. We send our estatements via an encrypted/password protected pdf. To get the customer to prove they can open access the pdf we do the following steps.
1 customer signs form stating they have the minimum system requirements and want estatements.
2 we send an email to them with a sample statement attached in PDF format and ask that they reply to our email with the date on that sample statement.
3 if they reply correctly we turn on estatement and begin sending the statements in pdf format to their email address.

This sounds good for a "push" delivery system (and can be adapted for Mose's system.) The only thing I would change is the content of the customer's confirmation email message. In order to dot the I's and cross the T's, the customer's confirmation email to you should be an affirmative request or confirmation of the earlier affirmative request for e-delivery. Rather than asking the customer to use his/her email client to generate an email message, you're in better control if you use a "mailto:" link or some other way that you can control the Subject line ("Please sign me up for e-Statements") and or the Body of the message ("This is to confirm my request for e-statements. In order to demonstrate my ability to access these e-statements, I have opened and read the sample statement. The date on that statement is"......customer completes final part of message.)
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#1453258 - 10/07/10 08:46 PM Re: Online Banking and E-statements [Re: Richard Insley]
Jayhawker Offline
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We are looking into doing electronic bank statements for certain types of accounts we offer. As for the required disclosures--first off what disclosures are required (Reg E, Reg CC,????) and are the disclosures (i.e. error resolution notice) suppose to be attached to the bank statements? I know Reg E comes into play--what else??? What about this E-sign you have been talking about?

Basically, from scratch, what do we have to do to start offering electronic bank statements?

Thanks

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