Go to the Main Laws page

FEDERAL DEPOSIT INSURANCE CORPORATION (FDIC)

The Federal Deposit Insurance Corporation (FDIC) preserves and promotes public confidence in the U.S. financial system by insuring deposits in banks and thrift institutions for up to $100,000; by identifying, monitoring and addressing risks to the deposit insurance funds; and by limiting the effect on the economy and the financial system when a bank or thrift institution fails. An independent agency of the federal government, the FDIC was created in 1933 in response to the thousands of bank failures that occurred in the 1920s and early 1930s.

The FDIC directly examines and supervises about 5,300 banks and savings banks, more than half of the institutions in the banking system. Banks can be chartered by the states or by the federal government. Banks chartered by states also have the choice of whether to join the Federal Reserve System. The FDIC is the primary federal regulator of banks that are chartered by the states that do not join the Federal Reserve System. In addition, the FDIC is the back-up supervisor for the remaining insured banks and thrift institutions.

FDIC LAW, REGULATIONS, RELATED ACTS (online here)

2000 - FDIC Rules and Regulations

§ 335.801 (b) Electronic filings. (7) Signatures. sub-parts (i), (ii) and (iii) all define electronic signatures as valid documents for submission to the FDIC.

(i) Required signatures to, or within, any electronic submission must be in typed form. When used in connection with an electronic filing, the term "signature" means an electronic entry or other form of computer data compilation of any letters or series of letters or characters comprising a name, executed, adopted or authorized as a signature.
(ii) Each signatory to an electronic filing shall manually sign a signature page or other document authenticating, acknowledging or otherwise adopting his or her signature
{{8-31-05 p.2423}}that appears in typed form within the electronic filing. Such document shall be executed before or at the time the electronic filing is made and shall be retained by the filer for a period of five years. Upon request, an electronic filer shall furnish to the FDIC a copy of any or all documents retained pursuant to this section.

Each company filing to the FDIC must have a physical copy of a physical signature from each signatory on file.

When the company submits the required documents to the FDIC a copy of the physical signature should accompany any materials that have been electronically signed through an esign system.

(iii) Where the FDIC's rules require a filer to furnish to a national securities exchange, a national securities association, or a bank, paper copies of a document filed with the FDIC in electronic format, signatures to such paper copies may be in typed form.

 

ESIGN solutions can allow businesses to comply with the requirement found in sub-section (a) that electronic signatures "must be in typed form rather than manual format". The electronic signature capturing process must create a kind of Signature Confirmation Receipt that is presented in "typed form" as a formatted file. 

6500 - FDIC Consumer Protection

§ 202.16 Requirements for electronic communication.

(a) Definition. Electronic communication means a message transmitted electronically between a creditor and an applicant in a format that allows visual text to be displayed on equipment, for example, a personal computer monitor.
(b) General rule. In accordance with the Electronic Signatures in Global and National Commerce Act (the E-Sign Act) (15 U.S.C. 7001 et seq.) and the rules set forth in this regulation, a creditor may provide by electronic communication any disclosure required by this regulation to be in writing. Disclosures provided by electronic communication must be provided in a clear and conspicuous manner and in a form the applicant may retain.

For detailed references please see my Main Laws page

(c) When consent is required. For disclosures required by this regulation to be in writing, a creditor shall obtain an applicant's affirmative consent in accordance with the requirements of the E-Sign Act. Disclosures under §§ 202.9(a)(3)(i)(B), 202.13(a) and 202.14(a)(2)(i) are not subject to this requirement if provided on or with the application.

A good system should provide a multi-step approach to “Consumer Consent ”. First, by providing a text area in the message to the recipient the sender can disclose all relevant information regarding the specific transaction. PrivaSign provides a second disclosure notification when the recipient clicks the "Sign It" button. Once again Full disclosure can be given as pertains to this specific transaction. Acknowledgement of this disclosure is captured as proof that the consumer was informed, and did accept to use an electronic process.

Sub-section (d) discusses the how the creditor should "(1) Send the disclosure to the applicant's electronic address" or "(2) Make the disclosure available at another location such as an Internet web site". PrivaSign allows for verified email disclosure with confirmation and signature receipts.

In compliance with (2)(ii) the service should be available to anyone with internet access and an email address.

(2)(ii) Make the disclosure available for at least 90 days

During the time the files are available online, both sender and recipient may download the file so that they may be in compliance with any applicable laws. This downloaded file can be saved to their computer, saved to a portable medium (CD, DVD or others) or even printed to paper. PrivaSign captures file integrity hashes so that all parties can verify the integrity of saved files.

§ 202.16 (f) Electronic signatures. An electronic signature as defined under the E-Sign Act satisfies any requirement under this part for an applicant's signature or initials.

[Codified to 12 C.F.R. § 202.16]

Supplement I to Part 202—Official Staff Interpretations

16(f) Electronic Signatures.
1. Relationship to the E-Sign Act. The E-Sign Act provides that electronic signatures have the same validity as handwritten signatures. Section 106 of the E-Sign Act (15 U.S.C. 7006) defines an electronic signature. To comply with the E-Sign Act, an electronic signature must be executed or adopted by an applicant with the intent to sign the record. Accordingly, regardless of the technology used to meet this requirement, the process must evidence the applicant's identity. 

Section 205.10 (b) Written Authorization for Preauthorized Transfers From Consumer's Account

5. Similarly authenticated. The similarly authenticated standard permits signed, written authorizations to be provided electronically. The writing and signature requirements of this section are satisfied by complying with the Electronic Signatures in Global and National Commerce Act, 15 U.S.C. 7001 et seq., which defines electronic records and electronic signatures. Examples of electronic signatures include, but are not limited to, digital signatures and security codes. A security code need not originate with the account-holding institution. The authorization process should evidence the consumer's identity and assent to the authorization. The person that obtains the authorization must provide a copy of the terms of the authorization to the consumer either electronically or in paper form. Only the consumer may authorize the transfer and not, for example, a third-party merchant on behalf of the consumer. 

Section 226.36--Requirements for Electronic Communication

36(b) General Rule
1. Relationship to the E-Sign Act. The E-Sign Act authorizes the use of electronic disclosures. It does not affect any requirement imposed under this part other than a requirement that disclosures be in paper form, and it does not affect the content or timing of disclosures. Electronic disclosures are subject to the regulation's format, timing, and retainability rules and the clear and conspicuous standard. For example, to satisfy the clear and conspicuous standard for disclosures, electronic disclosures must use visual text.
2. Clear and conspicuous standard. A creditor must provide electronic disclosures using a clear and conspicuous format. Also, in accordance with the E-Sign Act:
i. The creditor must disclose the requirements for accessing and retaining disclosures in that format;
ii. The consumer must demonstrate the ability to access the information electronically and affirmatively consent to electronic delivery; and
iii. The creditor must provide the disclosures in accordance with the specified requirements.

Customized disclosures need to be integrated into the signature process of each transaction. Individual businesses may always comply with (b)(2) by posting the disclosure on their personal website.

5. Retainability of disclosures. Creditors satisfy the requirement that disclosures be in a form that the consumer may keep if electronic disclosures are delivered in a format that is capable of being retained (such as by printing or storing electronically). The format must also be consistent with the information required to be provided under section 101(c)(1)(C)(i) of the E-Sign Act (15 U.S.C. 7001(c)(1)(C)(i)) about the hardware and software requirements for accessing and retaining electronic disclosures.

Signing a file is just half of the task. All parties involved are going to need access to this 'signed' document, both immediately and in the future. "Retainability" addresses this issue. Notice that no hard set rules are set. It is left up to the users to determine this requirement. You should think about the industry and the needs of your signatorees. While people can always download and store them on their own, there must be enough time to access the files.

6. Disclosures provided on creditor's equipment. A creditor that controls the equipment providing electronic disclosures to consumers (for example, a computer terminal in a creditor's lobby or an automated loan machine at a public kiosk) must ensure that the equipment satisfies the regulation's requirements to provide timely disclosures in a clear and conspicuous format and in a form that the consumer may keep. For example, if disclosures are required at the time of an on-line transaction, the disclosures must be sent to the consumer's e-mail address or must be made available at another location such as the creditor's Internet web site, unless the creditor provides a printer that automatically prints the disclosures.

36(d) Address or Location to Receive Electronic Communication

Paragraph 36(d)(1)
1. Electronic address. A consumer's electronic address is an e-mail address that is not limited to receiving communications transmitted solely by the creditor.

Paragraph 36(d)(2)
1. Identifying account involved. A creditor may identify a specific account in a variety of ways and is not required to identify an account by reference to the account number. For example, where the consumer has only one credit card account, and no confusion would result, the card issuer may refer to "your credit card account." If the consumer has two credit card accounts, the card issuer may, for example, differentiate accounts based on the card program or by using a truncated account number.
2. 90-day rule. The actual disclosures provided to consumer must be available for at least 90 days, but the creditor has discretion to determine whether they should be available at the same location for the entire period.

36(e) Redelivery
1. E-mail returned as undeliverable. If an e-mail to the consumer (containing an alert notice or other disclosure) is returned as undeliverable, the redelivery requirement is satisfied if, for example, the creditor sends the disclosure to a different e-mail address or postal address that the creditor has on file for the consumer. Sending the disclosures a second time to the same electronic address is not sufficient if the creditor has a different address for the consumer on file.
{{4-30-04 p.6982.02-E}}

36(f) Electronic Signatures
1. Relationship to E-Sign Act. The E-Sign Act provides that electronic signatures have the same validity as handwritten signatures. Section 106 of the E-Sign Act (15 U.S.C. 7006) defines an electronic signature. To comply with the E-Sign Act, an electronic signature must be executed or adopted by a consumer with the intent to sign the record. Regardless of the technology used to meet this requirement, the process must evidence the consumer's identity.

For detailed references to the E-SIGN Act please see my Main Laws page