Disclaimer: The Electronic Commerce Security Act (ECSA) was repealed and replaced with the Uniform Electronic Transaction Act (UETA), effective June 25, 2021. Please note that this change may affect the continued accuracy of this guidance as it pertains to the ECSA.

It depends on both the type of documents and your bank’s procedures. You should retain copies of records that confer title, including negotiable instruments conferring title (such as mortgage notes), unless your institution’s electronic storage system meets stringent requirements for those types of documents. Generally speaking, for most other types of documents, you do not need to retain hard copies, provided you are retaining accurate electronic images.

The general rule under Illinois law is that electronic versions of documents have “the same force and effect under the laws of this State” as documents in writing. However, for records that confer title, including negotiable instruments conferring title (such as mortgage notes), the Illinois Electronic Commerce Security Act (ECSA) requires you to retain those documents in their original form, unless your electronic storage system “allows for the existence of only one unique, identifiable, and unalterable original with the functional attributes of an equivalent physical instrument, that can be possessed by only one person, and which cannot be copied except in a form that is readily identifiable as a copy.”

In addition, the ECSA specifies certain record retention practices that apply when a rule of law “requires that certain documents, records or information be retained”:

(1) the electronic record and the information contained therein are accessible so as to be usable for subsequent reference at all times when such information must be retained;   

(2) the information is retained in the format in which it was originally generated, sent, or received or in a format that can be demonstrated to represent accurately the information originally generated, sent or received; and   

(3) such data as enables the identification of the origin and destination of the information, the authenticity and integrity of the information, and the date and time when it was sent or received, if any, is retained.

As to the admissibility of electronic documents in court, the ECSA provides that the rules of evidence cannot deny the admissibility of an electronic signature or electronic record on the sole ground that they are in electronic form or are not originals. However, we also recommend consulting with bank counsel before implementing an electronic imaging system to ensure that local court rules or practices do not impose other requirements which if not met might prevent you from using electronic documents in litigation.

For resources related to our guidance, please see:

• Financial Institutions Electronic Documents and Digital Signature Act, 205 ILCS 705/10(a) (“If in the regular course of business, a financial institution possesses, records, or generates any document, representation, image, substitute check, reproduction, or combination thereof . . . that accurately reproduces, comprises, or records the agreement, transaction, act, occurrence, or event . . . [it] shall have the same force and effect under the laws of this State as one comprised, recorded, or created on paper or other tangible form by writing, typing, printing, or similar means.”)

• Electronic Commerce Security Act, 5 ILCS 175/5-110 (“Information, records, and signatures shall not be denied legal effect, validity, or enforceability solely on the grounds that they are in electronic form.”)

• Electronic Commerce Security Act, 5 ILCS 175/5-115(b)(3) (Electronic versions of negotiable instruments and other instruments of title must be “created, stored, and transferred in a manner that allows for the existence of only one unique, identifiable, and unalterable original with the functional attributes of an equivalent physical instrument, that can be possessed by only one person, and which cannot be copied except in a form that is readily identifiable as a copy.”)

• Electronic Commerce Security Act, 5 ILCS 175/5-135 (Electronic record retention requirements that apply when “a rule of law requires that certain documents, records or information be retained . . . .”) 

• Electronic Commerce Security Act, 5 ILCS 175/5-130 (“Nothing in the application of the rules of evidence shall apply so as to deny the admissibility of an electronic record or electronic signature into evidence: (1) on the sole ground that it is an electronic record or electronic signature; or (2) on the grounds that it is not in its original form or is not an original.”)

• OCC, Advisory Letter 2004-9 (While the OCC is not your primary regulator, this Advisory Letter may be helpful. It discusses federal laws that apply to electronic record retention and the risks that should be considered when developing an electronic record retention policy.)