District Circular Letters
July 28, 1998
BANKING SUPERVISION AND REGULATION:
ELECTRONIC FINANCIAL SERVICES AND CONSUMER COMPLIANCE
To State Member Banks and
U.S. Branches and Agencies of Foreign Banks
in the Twelfth Federal Reserve District
Interagency Guidance on Electronic Financial Services and Consumer
Compliance
The Federal Financial Institutions Examination Council (FFIEC) has issued
the enclosed Guidance
on Electronic Financial Services and Consumer Compliance
regarding the consumer regulatory implications of emerging electronic
banking technologies.
The guidance provides federally insured depository institutions with
information about federal consumer protection laws and regulations, and
their application to electronic financial service operations. Many of
the general principles, requirements, and controls within the current
consumer protection regulatory framework apply to financial services conducted
electronically. This guidance should help financial institutions monitor
electronic banking operations to ensure that those operations are in compliance
with applicable laws, regulations, and policies.
The guidance contains two sections:
- "Compliance Regulatory Environment" summarizes relevant
sections of the federal consumer protection laws and regulations that
address electronic financial services, and includes interim compliance
policy guidance with examples of the application of existing consumer
laws and regulations.
- "The Role of Consumer Compliance in Developing and Implementing
Electronic Services" discusses the importance of compliance officer
involvement in the design, development, implementation, and monitoring
of electronic banking operations.
The Federal Reserve Board recently published proposed rules that may,
in the future, result in modifications to certain consumer protection
regulations (Dockets R-1002 through R-1006; see our letter of March 24, 1998). The FFIEC will issue
further guidance, if necessary, to address any significant future changes
to federal consumer protection regulations.
Additional Information
For additional information regarding these matters, please contact our
Banking Supervision and Regulation Department, at (415) 974-2953
or (415) 974-2955.
FEDERAL RESERVE BANK OF SAN FRANCISCO
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