QUESTIONS YOU SHOULD ASK YOUR VENDORS AND SERVICE PROVIDERS
It’s a given -- due diligence is important when evaluating vendors and administering oversight. But what should your institution do to ensure that your vendors’ and service providers’ business practices are consistent with your institution’s compliance policies and procedures? One approach is to carefully review the terms of your contracts. Another is to ask questions to ensure all of your concerns are addressed. Below is a list of questions and some commons gaps in this area that you may want to consider:
1.) Will the vendor have access to the personal identifiable information or other protected information, about consumers who enter into customer relationships with your institution?
STEPS TO UNDERSTANDING THE E-SIGN PROCESS
Oh the wonders of technology! Automation can be a wonderful thing, but it can also present challenges. For example, electronic signature (“E-sign”) seems like a relatively straightforward concept, right?
Let’s start with some basics. A signature may not be denied legal effect solely because it is in electronic form, and a contract cannot be denied legal effect solely because an electronic signature was used. Both E-Sign and the Uniform Electronic Transactions Act (“UETA”) provide that an electronic signature is the legal equivalent of a signature on a piece of paper. For example, an electronic signature could consist of: a name typed at the end of an email by the sender, or a mouse click, such as a button on a webpage – “I accept.” However, despite what seems like a straightforward process, E-Sign can present some complications that can arise from common situations.
EDUCATION, NETWORKING AND FUN!
We were thrilled to see more than 300 credit union industry professionals attend our 2014 Solutions Conference in May in St. Petersburg, Fla. In addition to enjoying the beautiful Florida weather, we hope conference attendees took away new strategies to implement in their own credit unions.
One of the highlighted topics from the conference, “Combating Fraud through Emerging Payment Technologies,” was addressed by a panel of experts from Consult Hyperion, Javelin, First Annapolis, Visa and FIS. Speakers from these organizations discussed fraud and recent breaches; the power of EMV to fight counterfeit fraud; the way tokenization fights card-not-present fraud; and the convenience of mobile and how it combats fraud.
Close to 130 people attended our “Essentials of EMV” workshop to learn more about the industry hot topic. Chuck Schuyler, VP of Consumer Lending for Landmark Credit Union, said, “The conference gave me the most in-depth details about EMV cards that I have been able to find. I now feel secure in moving forward with EMV.” Other popular breakout session topics included: tokenization, social media marketing, credit line management, ScoreCard and reports training.
CSCU MEMBER REACHES ITS HIGHEST LOAN BALANCE AFTER IMPLEMENTING RECOMMENDATIONS FROM PORTFOLIO CONSULTING SERVICES
Lake County Educational Federal Credit Union of Painesville, Ohio has experienced unprecedented success with close to $1 million in total loan balances, the highest ever held by the credit union. Lake County ran a balance transfer promotion from February 1 – April 1 with a 0% introductory rate for six months, and as a result garnered almost $77,000 in balance transfers from new and existing cardholders, and added 14 new credit cards, a significant achievement for a credit union with 2,800 members.
WHAT YOUR CREDIT UNION NEEDS TO KNOW IN THIS SITUATION
What is the proper response when a consumer reasserts a billing error that the credit card lender has already responded to, investigated and resolved?
The answer can be complicated, so let’s begin by looking at what is required under the Fair Credit Billing Act (FCBA). Enforced as part of the Truth and Lending Act, and implemented by Regulation Z, the FCBA gives a consumer the right, upon proper written notice, to request correction of "billing errors" by its creditors. Specifically, the FCBA permits credit cardholders to dispute suspected billing errors within 60 days of a credit card lender’s mailing of the periodic statement that first reflected a suspected error.
AMENDMENT TO REGULATION Z ABILITY-TO-PAY REQUIREMENTS
The recent amendments by the CFPB to Regulation Z’s ability-to-pay requirements, implemented the CARD Act’s protection for younger consumers. Below is a brief overview and several paths to complying with the amendments.
Section 301 of the CARD Act required card issuers to consider whether an applicant under the age of twenty-one has an “independent means of repaying.” Section 109 of the CARD Act prohibits card issuers from opening accounts or increasing credit lines on existing accounts for an adult consumer if the card issuer has not considered the consumer’s ability to make the required payments on the account. Notably, unlike Section 301, this latter section does not include the term “independent”. The disparity between the two provisions created significant blowback and concerns from industry participants – and rightly so.
- Featured Articles
- Maintaining Compliance and Consitancy
- Electronic Signatures and Customer Consent
- CSCU 2014 Solutions Conference – Make Waves
- Lake County Educational FCU: Small Credit Union, Big Success Story
- Reasserting Billing Errors
- Credit Card Regulation Update!
- City Co Federal Credit Union Launches Credit Card Start-Up with ProDirect® from CSCU
- Innovation is Key to Winning with Mobile