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Does Log On = E-SIGN?

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Question: 
Will having the customer log on to internet banking suffice for their digital signature if we want to change the terms of an electronic agreement or make some other product or service available?
Answer: 

First, lets look at the agreement. Having the customer log on with a username, password or some other process of multi-factor authentication helps you verify the identity of that customer. Knowing who you are working with is required. Next, you have to disclose the terms of the agreement so the customer can acknowledge if he or she wants to enter into that agreement then E-SIGN can be used to bind the agreement. E-SIGN can be as simple as clicking an "I Agree" button that they reach once the agreement has been presented. Without first presenting the terms of the agreement, logging on wouldn't qualify as an acceptance and you would have a hard time defending that agreement in court.

The term "electronic signature" means an electronic sound, symbol or process attached to or logically associated with a contract or other record and executed or adopted by a person with the intent to sign the record. If you presented the terms of the agreement and then said that by logging in to this new page they would be bound by the terms, then that would be different. The sequence of events is now in place to see the agreement, to accept the terms and to demonstrate that.

First published on BankersOnline.com 4/06/09

First published on 04/06/2009

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