If a customer ask's to have their statement sent electronically, are there requirements we need to follow? e.g. Authorization forms, 30 day notice requirement, etc.

Or, if the bank should decide to give the customer the option of electronic statements, what steps should be taken.

Thanks for your input.

We have them fill out a small form that they sign that basically says you will no longer receive your statement via tradional mail and only via e-mail. I guess we feel we're covered. We give the option at account setup and have done statement stuffers with the same form. We've got about 15% of our retail base getting their statements this way.

For starters check out the E-Sign regulations.

Quote:

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You may be on thin ice

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Failure to give disclosures properly can result in retroactive enforcement action by your regulator.

Since email is not considered secure. How are privacy issues addressed? Do you actually send the electronic statement via email or does the customer get notification to log in to your web site and pick it up through a secured session? Just curious as we are looking at offering this account feature.

We have a secure encrypted email in place that requires a password. It goes through a secure data center and can be sent certified or non-certified delivery.

It sounds as though our first step would be to have a written request from the customer requesting e-statements. Once we have the authorization the only other electronic disclosure that would be required is if we have a change in terms relating to their account.

Check out this huge thread about the subject. It will either help a ton or scare the wits outta you!

E-SIGN vs. UETA

Maybe I’m being naive, but here’s the way I see it.

If a customer tells you that they live at 110 Elm St, Anytown, USA. You assume that when you send them their statement they live there and they get it. You don’t ask them if they have the capability to open their mailbox and retrieve the statement. You don’t ask them to call and let you know that they got it. You don’t ask them if they have the ability to read.

Why wouldn’t the same hold true for e-statements? If the customer requests to receive their statement this way and gives you an email address. Can’t you assume that they are getting it?

So as far as all this “demonstrable consent” goes, maybe we our on “thin ice”, but we just don’t see a problem. If our regulatory body does criticize us, I’ll let you know. If anyone already has been criticized after implementing (ITI’s distribution) please let me know.

The difference is many more things can go wrong with the new technology of e-mail, vs what we are accustomed to in the snail mail environment.

I would urge you as a compliance professional and an officer of your bank to ensure your procedures are correct. Your examiner may or may not discover it. That won't help you if customers sought litigation for some reason. If you are confident it is fine, bring it to the attention of your regulator, come back here and tell me. These are new rules we are all getting used to. But your process is not compliant with my read of the legal requirements.

The reality of the compliance world is that sometimes we do things just because the law requires it. If no banking regulations existed, and assuming a very conservative, consumer-conscious management - how many of the current regulation requirements would we implement?

In this case, no regulation requires us to verify that a customer can read, open their mail box, etc., but one does require that we verify a customer can receive and open an e-statement!

Anon- The difference between paper-based delivery and e-delivery is that the regulations in question (Regs DD and Z for statements) require that these periodic disclosures be "written" or "in a form the consumer may keep." Until the federal ESIGN Act, there was no legal way to substitute electrons for paper. Since ESIGN's effective date in 2000, you have a legal way to e-deliver "written" disclosures. If you don't follow the ESIGN system, your disclosures are not "written" and your regulator may conclude that you have not given the disclosures. This conclusion might be followed by a directive to provide, retroactively and on paper, all the disclosures that have not been "written." Penalties may also apply.