Internet Banking News
June 14, 1999
1) The Board of Governors of the Federal Reserve System has issued a
revised Consumer Handbook on Adjustable Rate Mortgages (CHARM). Regulation Z, which
implements the Truth in Lending Act, requires that the handbook be provided to consumers
when they apply for an adjustable rate mortgage loan. If your web site has an application
for an adjustable rate mortgage loan, how is your site providing the handbook when a
visitor completes the Internet application?
When the customer completes the on line adjustable rate mortgage application and clicks
the "submit" button, a web page appears that gives the customer the option of 1)
viewing the handbook or 2) printing the handbook. In either case, this web page should
state that the handbook will be mailed to the applicant when received by the bank. The
customer then clicks another submit button and the application is e-mailed to the bank.
A copy of the Consumer Handbook on Adjustable-Rate Mortgages can be found at http://www.federalreserve.gov/pubs/brochure.htm.
2) This week "Comptroller of the Currency John D. Hawke, Jr. appealed today to the
banking industry to improve customer service standards and warned that some current
practices are abusive and may invite government scrutiny if not corrected."
In particular, Mr. Hawke cited the sale of customers' personal financial information by
banks to telemarketing firms in return for a commission on sales. The information sold
includes addresses, telephone numbers, account balances, credit card purchases, last
payment dates, occupations and credit-scoring information, among other items.
The OCC's complete statement can be found at http://www.occ.treas.gov/ftp/release/99-51.txt.
June 10, 1999 - The Attorney General in Minnesota files suit against U.S. Bank for selling
customer information for $4 million to a telemarketing firm saying U.S. Bank violated the
Fair Credit Reporting Act and engaged in deceptive advertising and fraud. You can read the
article at http://www.startribune.com/stOnLine/cgi-bin/article?thisStory=75826094.
If your bank does not sell customer information, be sure that your Internet Privacy
Statement states that [Company] does not sell or provide customer information to any
outside party. I would strongly recommend against selling customer information.
3) This week there is another warning about an e-mail virus that has an attached document
called "Worm.Explore.Zip" or "Zipped_files.exe." If you receive an
attachment with these names, do NOT open the attachment. Immediately delete the e-mail.
Remember to update your virus program.