The Electronic Signature in Global and National Commerce Act (E-Sign) Act)

Consumer consenting or confirming consent electronically

must be in a manner that reasonably demonstrates that the consumer can access information int he electronic form that will be used to provide that information that is subject of the consent

The purpose of the E-Sign Act is to

provide a general rule of validity for electronic records and signatures for transaction in or affecting interstate or foreign commerce. It allows the use of electronic records to satisfy any statute, regulation, or rule of law requiring that such information be provided in writing, if the consumer has consented to such use.

What are the Major Provisions

1. Consumer Disclosures (Prior Consent, Notice of Availbility of Paper Records, Hardware and Software Requirements, Notice of Changes 2. Record Retention 3. Regulatory and Other Actions

Examination Procedures

1. Determine if and what the bank electronically delivers compliance related notices or disclosures for 2. Determine if the bank has procedures to ensure compliance with the E-Sign Act 3. Determine that the consumer, prior to consenting, is given all applicable disclosures. 4. Dtermine the consumer provides consent electronically or confirms their consent electronically in a manner that reasonably demonstrates that consumer can access information in the electronic form. 6. Make sure they change in hardware or software disclosure and updates requirements are followed by the bank 7. Determine that the financial institution maintains a single "authoritative" copy of any transferable record relating to a loan secured by real property. Such record must be "unique", "identifiable", and "unalterable". 8. Make sure the bank follows the requirements for record retention.

Prior to obtaining consent, banks must provide the consumer a clear and conspicuous statement informing the consumer

1. right or option to have record provided on paper or non electronic form, right to withdraw consent, fees in event of withdrawal 2. Whether consent applies to just the transaction or the course of the relationship between the parties 3. Procedures consumers must use to withdraw consent and to updated information needed to contact the consumer electronically 4. Inform the customer how the consumer may request a paper copy and if theres a fee for it

What does the E-Sign Act apply to?

Agreements made on or after October 1, 2000. and Record Retention for anything after March 1, 2001

Record Retention

Bank must maintain electronic records accurately reflecting the information contained in applicable contracts, notices, or disclosures so that they remain accessible to all person who are legally entitled to access.

Final Rule

In November 2007, the FRB adoped final rules for establishing uniform standards of elecronic delivery for 5 consumer protection regulations 1. Reg B 2. Reg E 3. Reg M (Consumer Leasing) 4. Reg Z 5. Reg DD If the consumer uses electronic means to open an account or request a service, the disclosures must be provided before the account is opened or the service is requested.

Prior to consenting to the use of an electronic record

a consumer must be provided with a statement of the hardware and software requirements for access to and retention of electronic records.

If a change of hardware or software might cause the consumer to no longer be able to access information, the bank must

provide the consumer with a statement of (a) the revised hardware and software requirements for access to and retention of electronic records, and (b) the right to withdraw consent without the imposition of any condition, consequence, or fee for such withdrawal; and • make sure they consent or confirm consent in the same way as before, confirming they have the ability to do so.

Oral communications or a recording of an oral communication

shall not qualify as an electronic record