Is there any issue with bank employees (mainly branch managers or loan officers) communicating with their customers through text messages? This would be for questions or comments regarding current accounts they have with the bank. For instance, we have one business customer that contacts one of our branch managers whenever they have a debit card request (temporary limit increase, travel notice, etc). Other than expecting the branch manager to verify they are talking to our customer, is there any other issue with this? How do other banks handle these types of communications?

Thanks!

I would be concerned as to who is initiating the contact, has the customer specifically opted in to text messaging and are they given an option to opt out.

Well, that does concern me, but at this point, I have no idea who initiated it. Do customers have to opt in/out of text messages if they are not marketing related? What if they are just messages regarding an account the customer already has with the bank?

However, I understand that there is always a concern that the employee sending messages could send a message that is a marketing/advertisement type of message....

How am I supposed to monitor what every officer of the bank is doing through text messages??

How am I supposed to monitor what every officer of the bank is doing through text messages??

Well I assume a couple of things. These are 1) bank owned devices and as such, you can ask to review the devices at any time to insure that they are following your record retention requirements and other policies and procedures as far as electronic communications, or 2) they are personal devices and work related activities should be banned from occurring on such devices.

Well....I would say it is a mixture of 1 and 2 above. I have a personal phone, but have my work email on my phone. I do not text customers at all. While I am not 100% sure, I would say it's a possibility that some of the executive officers have bank owned devices while others do not. And in a perfect world, I would agree with you about asking to review the devices, however, this is not a perfect world and I'm sure I would not be allowed to review the devices.

What about the opt in/out? Is this only for marketing purposes or should customers be given this choice if there is a possibility of any contact?

there have a been a few high profile issues of late between banks and regulators concerning clients, employees, text messages, and a banks inability to capture, store, and retrieve said text messages when needed in the event of a dispute. may want to go look at some of those as you try and build a procedure or policy. and how you control on BYOD phones is another issue to think about

Thanks Happy! I will definitely look some of those up. I appreciate your feedback.

Security is an issue also. I don't believe texts are encrypted.

The TCPA is a very complicated issue and it might be well worth contacting an expert in the subject about your questions. There are some pretty hefty fines for violating the TCPA - not to mention the SEC fines that have been levied if any of your employee are investment advisors.

Thanks Randy. Can I just say, the more comments I see, the more my head starts pounding! We have a UDAAP review going on right this minute, beginning preparation for an FDIC exam in October and now I have an employee emailing me because she doesn't like updating customer information that is being passed on to her from branch managers who are communicating through text messages (I don't blame her)!

It's a glorious day!

Really though - I very much appreciate everybody's comments and input! It's always a big help!!

I don't have any answers, but you might you read this article about similar situations.

https://www.reuters.com/legal/litig...t-banks-staff-communications-2021-10-12/

I would never want bank staff to conduct transactions or anything other than a generic question on their own devices. "What time does the drive-up close" or "Are you closed for the holiday" is the most I would do.

If the bank has an app or online banking, requests should be going thru those channels. What happens if the customer files a Reg E claim, "Hi Bankwoman, your favorite customer Andy Z here. there was a $250 withdraw from my account last night I didn't make. Can you look into it for me?"

You get my text late Thursday and you're off Friday. Maybe adding some vacation to Monday's holiday. All the while your Reg E clock started and the bank itself doesn't even know, but that employee who is the bank to the customer knows. What if the employee loses their phone or it gets hacked? "Andy, this is Bankwoman at your favorite bank. You know its me cuz this is my number. Your account has an NSF but I can sneak in a deposit if you send me gift card numbers and I'll get the NSF fees waived that way."

There are security nightmares here and now the CFPB is saying poor info sec practices are a UDAAP issue. While good intentions are here with good customer service, the risk issues are through the roof IMHO and the bank has no way to manage it if this is allowed to happen.