HSA and E-Statements

Hello, we currently offer HSA's. They are DDA accounts and we provide monthly statements. HSA's are not subject to Reg E. Reg DD does not require periodic statements.

We are trying to determine whether we can turn on e-statements and turn off paper statements for our online banking users without affirmative consent (e-sign).

I've been running down the rabbit hole and could use some help... Thank you!!!

If they aren't required under regulation to be delivered, you can deliver them any way you want too and that the customer will accept.

I would respectfully disagree with the statement that HSAs are not subject to Reg DD.

http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=1716108

http://www.bankersonline.com/forum/ubbthreads.php?ubb=showflat&Number=563492

As far as eStatements, you may be able to make them available on the accounts but I'm thinking you still need affirmative consent.

Maybe a BOL guru, like Randy Carey, will weigh-in on this for you.

Read those threads you linked carefully. They say that IF the bank elects to provide periodic statements, they are subject to Reg DD requirements. The periodic statements themselves are NOT a requirement.

See the interpretations to 1030.6(a)
General. Institutions are not required to provide periodic statements. If they do provide statements, disclosures need only be furnished to the extent applicable. For example, if no interest is earned for a statement period, institutions need not state that fact. Or, institutions may disclose “$0” interest earned and “0%” annual percentage yield earned.

He said that they provide periodic statements, which is why I linked those threads.

Understood. So the question really becomes, "If we choose to provide a statement that is not required, but by providing the statement we trigger the disclosure requirements on the statement, does that make the non-required statement with required disclosures subject to e-Sign?"

Who else's head is spinning? TGIF!

Mr. Carey, thank you for your quick response. The point you make and the question BrianC asks are essentially the two positions our team has come to.

If you all have any other resources beyond the regulation (legal precedent, authoritative guidance, etc) I'd be happy to do more research.

Again, thank you everyone who weighed in on the topic! Have a nice day!

IMHO - The statements are still voluntary, but the content would not be. It still does not equate to the legal requirement to deliver a statement.

This has been a thoughtful conversation about a deceptively tricky question. My single concern with the thread is that it's limited to ESIGN, Reg. E, and Reg. DD. No one's mentioned any other state or federal laws or regulations that might come into play as a result of the specialized type of account--a HSA (about which I know absolutely nothing.)

Assuming it's appropriate to rule out these potential sources of restriction, requirement, or risk, my next question becomes "what does your account agreement (contract) say?" If you have contracted to provide statements of account in a particular way and at specified times, then you are bound by these terms.

Once you have identified all possible authorities that could affect your statement delivery practices, you must review each authority. My steps would be:
1. Does this law, regulation, rule, contract provision, etc., etc. say anything about the type of communication we commonly call "statements"? In not, mark it off the list a inapplicable. If so,
2. What kind(s) of accountholder communication is/are required?
3. How often is it required?
4. What must be included in the required communication?
5. AND (here comes the issue that's the subject of this thread), in what form must the communication be rendered?

The key to understanding and using ESIGN is knowing whether ANY authority that's relevant to your handling of these accounts requires ANY kind of communication in writing.

Before leaping ahead to the intricacies of demonstrable consent, it's very important to understand the reason why Congress enacted ESIGN in the first place. Quite simply, ESIGN is an amendment to the legal definition of the word "written." That's it!

So...as you work toward the deceptively simple Y/N answer that you need, you must winnow out all possible authorities that exert no control over your HSA accounts OR impose no communication requirements that can only be satisfied "in writing." If you can't get Regs. E and DD off the list, then you're stuck with paper or informed demonstrable consent.

One final consideration--cramdown is not customer-friendly and a "my way or the highway" service change could cost you profitable customer relationships.

Richard, thank you for the detailed respose. Our team has identified the governing regulations and verified the language in our account agreements. We have asked our regulators and awaiting a response.

Again, thank you everyone for your input. Have a nice day!