If a customer signs up for e-statements, we make the statement available in our e-banking environment and send a notification e-mail to the customer.

Does anyone have advice on how to handle the situation when the customer's e-mail address becomes invalid but the banking relationship continues? Do we need to seek out the new e-mail address or is it enough that the statements are available in online banking?

ESIGN required you to disclose "the procedures the consumer must use to update information needed to contact the consumer electronically...." It's an excellent practice to add an explanation of the actions you will take when you discover that the customer's EMA no longer works. Now, it's time for you to take those actions.

Richard, what would be a reasonable way for us to take any action in this situation?

If you are no longer able to communicate with a customer via email (in the manner you originally agreed), then you need to reestablish contact in another manner. If that means paper statements in the U. S. mail, let's hope the designers of your e-delivery mechanism anticipated problems like this and included a pricing differential. If they did, switch to paper and up the service charge. If they didn't, switch to paper and eat the extra handling cost.

Is the requirement for us to have procedures outlined specifically in ESIGN? Or is it best practice? I am just trying to understand what we must do, although I agree with you that it may be a good idea to do more than that.

What I quoted above comes from ESIGN.

Richard, the part you quoted about disclosing procedures for the customer to update their contact information is from ESIGN. But is the part about us having to "reestablish contact in another manner" also in ESIGN? I am not seeing that requirement.

The e-mail only contains a notification that the statement is ready to view. So, technically, e-mail is not the method of delivering the statements, they continue to be uploaded to each customer's online banking regardless of their e-mail address.

No, maintaining contact with your customer is a sound banking practice & may be part of your method for determining dormancy. Also, while your e-delivery method for statements is "pull", do you "push" other types of disclosures?

Thank you for the clarification. We don't provide an option for electronic delivery for other types of disclosures, so those get mailed and we do try to determine and correct the mailing address in our system if they are returned undelivered. However, the paper notices are not available in any other way, while the electronic statements are always there...

Is the customer logging on to internet banking? Can you deliver a message in that manner?

You have an account with returned email. I'm sure you also have returned snail mail from customers. The difference is, with email you may have a valid snail mail address to use a s a backup.

When we get notification that an email was undeliverable b/c of a bad email address (as opposed to when their mailbox is full), we flag the customer's internet banking account to force them to update their email address at their next internet banking login.

If they don't do so within the next 21 days, we remove them from electronic statements, and restore their paper statements (all disclosed at enrollment).

-B'2011

Your mileage may vary.
Some assembly required.
Batteries not included.
Do not fold, spindle or mutilate.
Kid tested, mother approved.
The tribe has spoken.
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When we get notification that an email was undeliverable b/c of a bad email address (as opposed to when their mailbox is full), we flag the customer's internet banking account to force them to update their email address at their next internet banking login.

If they don't do so within the next 21 days, we remove them from electronic statements, and restore their paper statements (all disclosed at enrollment).

-B'2011

Your mileage may vary.
Some assembly required.
Batteries not included.
Do not fold, spindle or mutilate.
Kid tested, mother approved.
The tribe has spoken.
List each check separately by bank number.
Driver does not carry cash.
Please remain seated until the ride comes to a full and complete stop.

What about a little "twist" to this scenario? In this situation, a customer signs up for eStatements that are only viewable within online banking.

Online banking access is disabled due to inactivity after 200 days. Institution continues to deliver eStatements within the online banking portal.

At any time, the customer could "re-enroll" in online banking and all of their statements would be there.

Does the institution have any responsibility to disable eStatements at the same time as the online banking disabling? Or - because they can obtain access through a simple re-enrollment process - the statements are still considered "delivered" under Reg E?

Under Reg. E, your concern is not delivery of statements--but rather delivery of the Reg. E disclosures. When there are electronic fund transfers during a cycle, you owe the customer the Reg. E disclosures. If you have no other way to deliver the disclosures other than a statement, then you have no choice but to deliver a statement.

You did not explain what "200 days of inactivity" means. If the account is totally dormant, then there are no EFTs--meaning no Reg. E disclosures are necessary. Absent the need to deliver Reg. E disclosures, the statement becomes optional.