Topic: Electronic Signatures in Global and National Commerce Act (ESIGN)
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We would like all of our account opening documents and other paperwork on our teller line to be signed with an electronic pad so that paper copies do not need to be printed. For documents requiring notarized signatures, we would have a notary witness a customer sign with an electronic pad then sign their name using an electronic pad. The notary’s information also would be entered electronically. Is the notary’s seal required? If so, can it be affixed electronically?
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Notaries commissioned to perform notarial acts in Illinois must affix their seal to their signature, and this cannot be done electronically. Further, we believe that when your customer’s signature is being notarized, both your customer and the notary must sign on paper using ink. The Illinois Notary Public Act requires notaries to affix their “rubber…
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Is it permissible in Illinois for banks to send overdraft notices to customers electronically? We assume that if this is possible, the customer would have to consent to receiving the electronic notices and the disclosures for any accounts that could become overdrawn should state that overdraft notices may be sent electronically.
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We are not aware of any Illinois laws or regulations that require overdraft notices to be sent by mail. Accordingly, we believe your bank may send electronic overdraft notices to your customers provided they have consented to receive electronic notifications in accordance with the federal E-Sign Act’s requirements. We also believe it would be prudent…
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Our bank is purchasing the custodial rights for a portfolio of brokered certificates of deposit (CDs) from a bank that previously was the deposit broker for the CDs. Our bank will become the deposit broker and custodian of the CDs, which have individual owners and are deposited at a separate bank. However, the CD accounts at the depository bank will be held in our name with our EIN, and we will receive a percentage of the interest from the CDs. Along with the portfolio, we will receive one year’s worth of physical records for the CDs and all prior records for the CDs in electronic form. The records will include the identifying information for the owners of the CDs that the selling bank obtained as part of its Customer Identification Program (CIP). We will not conduct our own CIP for these accounts. What are the record retention requirements for these documents?
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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. We believe that your bank should retain any identifying information for the individual owners of…
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How long are we required to retain land trust files after the trust has been closed?
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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. The length of time you are required to retain documents contained in a land trust…
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We want to convert our open loan files from paper to electronic files. We currently convert closed loan files to electronic files and we have a document checklist on naming conventions for the file names and method of storage. We would like to develop procures for electronically storing our active loan files as well. Where should we begin?
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Overall, our recommendation is to pick a date on which your bank will begin scanning new loan files into your electronic storage system, rather than attempting to convert all of your existing open loan files at once. We polled our internal IBA Compliance Division Advisory Committee on best practices for electronic document conversion of open…
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Our bank is preparing to allow customers to use electronic signatures to open accounts and make changes to accounts in all areas of our bank, including deposits, loans, and trusts. Is there any reason to continue to obtain a customer’s wet ink signature on a signature card? Are wet ink signatures required for mortgage documents or for certification of beneficial ownership forms? Also, is there a method of identification authentication for customers opening accounts using electronic signatures that is better than other methods when it comes to catching synthetic identity fraud?
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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. As a general rule, we believe your bank may accept a customer’s electronic signature on…
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What are the record retention requirements for closed safe deposit box agreements?
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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. We are not aware of any specific legal requirement that applies to the retention of…
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What are the record retention rules for lock boxes in Illinois, including customer’s statements, logs, and any other type of information related to the lock box? Also, what are the record retention requirements for email, either between bank staff and customers, or internally among bank staff related to a transaction?
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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. We are not aware of any specific legal requirements in Illinois that apply to the…
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Regarding safe deposit box access records, is there any requirement in Illinois to keep the original paper document with the customer’s signature once we confirm that a scanned copy has been saved to our system?
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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. No, there are no mandatory retention periods for original safe deposit box access records when…
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When a customer comes in to open a deposit account, we are going to begin using a pad to capture the customer’s signature. If the customer does not want the account opening documents for their records, are we required to print and provide them anyway? If they can “opt out” from receiving printed documents, do we have to physically document that anywhere in the file (in the form of a signed disclosure from them), or can we just make a file note that states the customer wished not to be provided copies?
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Generally, we do not recommend allowing a customer to “opt-out” of receiving the required account opening disclosures, irrespective of whether the customer provides a physical or digital signature. If a customer does not wish to receive printed disclosures, we recommend walking the customer through the E-Sign Act’s disclosure and consent procedures so that your bank…