Are you helping members sign up for online banking? You may think this is an odd question, but if you are helping members, you may be breaking the law!
So here is the scenario: A member comes into the branch and after completing a transaction, the credit union employee asks the member if they are signed up for online banking. The member responds that they are not but would like to be and the employee proceeds to sign the member up via the employee’s computer. You may be asking yourself where the issue is if the employee is providing the necessary disclosures to the member. And this is where the problem arises.
The Electronic Signatures in Global and National Commerce Act of 2000 (ESIGN) requires that before any electronic transaction takes place, the member must first affirmatively consent to conduct business electronically. Before providing consent, ESIGN requires the credit union to provide a number of clear and conspicuous disclosures. Once the disclosures are provided, the member must consent electronically, or confirm his or her consent electronically, in a manner that “reasonably demonstrates” that he or she can access the information in the electronic form that will be used by the parties to conduct the transaction. In other words, if the member will be conducting online banking transactions from his or her home computer, then the above noted consent needs to be provided from the same home computer. If the credit union employee is signing the member up via the employee’s computer, then the member is not reasonably demonstrating that he or she can access the information. The same requirements would also apply to mobile banking.
Keep in mind that you can still provide instruction to the member on how to sign up for online banking…you just can’t do it for them.