Interim Rule Allowing Electronic Disclosures

4. A paper writing mailed to a person can be held for receipt by an agent of the person for an indefinite amount of time without the person losing their privacy to that agent.

To ask another person to access and retain electronic mail necessitates asking that person to open the electronic mail. It becomes impossible for electronic mail to be "held" by another, without a complete loss of privacy regarding the sender and the content of the message.

Unfortunately, the Interim Rule allows essential TILA notices to be posted on a website and the consumer notified about that posting by physical mail.21 Then the consumer has to find a computer with Internet access and a working printer and plug in the correct address for the web page containing the information regarding the consumer's particular transaction (which is likely to involve 50 to 100 separate characters which must be placed in perfect order) to access a TILA disclosure that is currently just mailed to the consumer. Further, this disclosure need only stay on the website for 90 days. So if the consumer is not able to jump through these hoops in time, the consumer will never have a copy of crucial information that affects important rights.

5. Junk mail received through the post office is readily identified and easily discarded such that it does not affect the delivery of important notices and documents.

Electronic junk mail filtering programs incorrectly filter out real messages needed to be received by the recipient.

Delivery of all post-transaction TILA notices and disclosures otherwise required to be in writing and provided to the consumer in a form the consumer can keep should be considered to be delivered electronically only when there has been either an electronic acknowledgment or a manual acknowledgment that the consumer has opened the email. This can be done cheaply and can thus provide assurance that electronic disclosures are not being used as a way of avoiding actual delivery of important disclosures to consumers.

D. The Interim Rule fails to apply E-Sign's consumer consent provisions to implement the consumer protection purposes of TILA.

1. Electronic consent must be required in a manner which ensures consumers will be able to access and keep disclosures otherwise required to be in writing.

The electronic consent requirement was included in the E-Sign legislation to protect consumers in a number of ways. Clearly, one reason was to protect consumers from the use of electronic commerce to facilitate fraud on consumers. However, it is clear from the Congressional record that the electronic consent is also intended to create a type of electronic handshake between the parties - a means to ensure that the electronic communication will in fact be successful. It is also apparent that the electronic consent is meant to emphasize to the parties the significance of the agreement to receive records electronically and to ensure that there is actually a meeting of the minds.

The electronic consent protects consumers in both the off-line world, as well as the on-line world. The provisions protect consumers from agreeing to electronic records mistakenly, or as part of a form contract. They protect consumers from mistakenly agreeing to receive electronic records in a form that they are not able to access and retain. And these provisions protect consumers from fraudulent practices which might otherwise be facilitated by the laws like E-Sign, which are designed only to expedite the transition to an electronic marketplace.

The three distinct but related protections afforded by the requirement for a consumer to electronically consent are:

• To ensure that the consumer has reasonable access to a computer and the Internet to be able to access information provided electronically.

• To ensure that the consumer's means of access to electronically provided information includes the software to read the electronic records provided.

• To underscore to the consumer the fact that by electronically consenting, the consumer is agreeing to receive the described information electronically in the future.

Senator Leahy emphasized these differences when he said on the floor of the Senate, regarding the passage of E-Sign:

[This bill] avoids facilitating predatory or unlawful practices. . . . [It] will ensure informed and effective consumer consent to replacement of paper notices and disclosures with electronic notices and disclosures, so that consumers are not forced or tricked into receiving notices and disclosures in an electronic form that they cannot access or decipher.

. . . I maintained that any standard for affirmative consent must require consumers to consent electronically to the provision of electronic notices and disclosures in a manner that verified the consumer's capacity to access the information in the form in which it would be sent. Such a mechanism provides a check against coercion, and additional assurance that the consumer actually has an operating e-mail address and the other technical means for accessing the information. (Emphasis added)22

The Board must keep in mind the important reason for the specific language on electronic consent and ensure that its rules promote the essential consumer protections intended with this statutory requirement. Each of the specific words included in the requirement of E-Sign Section § 7001(c)(1)(C)(ii) must be given meaning. A number of specific requirements in the Interim Rule, as well as several casual comments in the accompanying commentary, indicate that the Board has misinterpreted much of the rationale behind this requirement.

The Board's justification for not requiring consumer consent for pre-transaction disclosures appears to be based on the assumption that the shopping for credit will be over the Internet.23 This entire rationale for the application of the consumer consent requirements to TILA disclosures fails to recognize the very real possibility that in a face-to-face transaction the consumer may be asked to look at a computer screen provided by the creditor. It might therefore be entirely legal for a creditor in a face-to-face transaction - for both open end unsecured credit 24 as well as home secured credit 25 - to provide these disclosures by showing consumers a computer screen on which the disclosures were displayed.

In this situation, there is no reasonable way for the consumer to effectively retain these disclosures. This visual display certainly should not qualify as providing disclosures otherwise required to be in writing to a consumer. After the transaction is consummated this consumer must go to computer and attempt to find the specific disclosures provided for his credit. It would be very difficult, to say the least, for the consumer to be assured that the disclosures accessed after consummation were the same as those seen on the computer screen before consummation.26

2. The Interim Rule does not implement the requirement for a consumer to "reasonably demonstrate" the ability to access and read electronic disclosures

The Board asks for guidance on whether interpretive guidance is necessary on the meaning of the requirement in E-Sign that a consumer electronically consent in a manner which "reasonably demonstrates that the consumer can access information in the electronic form that will be used to provide the information that is the subject of the consent."27 On behalf of our clients, we urge the Board to provide guidance on this and related questions.

The issue is whether the consent process itself must electronically indicate that the consumer can access the electronic records provided, or whether this requirement is satisfied by allowing the consumer the opportunity to test his capacity to access the electronic records. The question is whether the requirement for an electronic consent is accomplished when an email which includes an attachment in PDF format simply requires the consumer to respond by email and affirm that the consumer could access the PDF attachment. The answer is unequivocal: unless the consumer's email response contains some information that necessitated the consumer's actual opening of the PDF attachment, this electronic consent would not satisfy the statutory requirement.

The statutory language itself is clear: "in a manner which demonstrates that the consumer can access" does not permit the consumer to simply affirm that access. The operation of consenting itself must provide the demonstration. This was a matter of considerable debate during the passage of E-Sign. Several Senators insisted that the electronic consent process test the consumer's computer's capacity to access the electronically provided information. They did not want to leave it to the consumer's subjective understanding of his or her computer's capacity. Every person who has ever received e-mail with attachments has found themselves unable to open some of those attachments. The electronic consent requirement mandates an electronic handshake - whereby the two computers communicating are assured that they can each open and read the electronic information to be shared between them.

This issue itself was the matter of extensive comment by Members of Congress involved in the passage of E-Sign. Consider the following excerpts from the Congressional Record regarding the language in 15 U.S.C. § 7001(c)(1)(C)(ii).

By Senator Leahy:

Section 101(c) of the conference report requires the use of a technological check, while leaving companies with ample flexibility to develop their own procedures. The critical language, which Senator Wyden and I developed and proposed, provides that a consumer's consent to the provision of information in electronic form must involve a demonstration that the consumer can actually receive and read the information. Section 101(c) also provides that if there is a material change in the hardware or software requirements needed to access or retain the information, the company must again verify that the consumer can receive and read the information, or allow the consumer to withdraw his or her consent without the imposition of any conditions, consequences or fees.28

A joint statement by Senators Hollings, Wyden and Sarbanes, confirms this:

Today, many different technologies can be used to deliver information - each with its own hardware and software requirements. An individual may not know whether the hardware and software on his or her computer will allow a particular technology to operate. (All of us have had the experience of being unable to open an e-mail attachment.) Most individuals lack the technological sophistication to know the exact technical specifications of their computer equipment and software. It is appropriate to require companies to establish an "electronic connection" with their customers in order to provide assurance that the consumer will be able to access the information in the electronic form in which it will be sent. This one-time "electronic check" can be as simple as an e-mail to the customer asking the customer to confirm that the or she was able to open the attachment (if the company plans to send notices to the customer via e-mail attachments) and a reply from the customer confirming that he or she was able to open the attachment. (Emphasis added.)29

By Mr. Tauzin:

S. 761, I must also mention, provides for extensive consumer protection. Not only are existing state and federal consumer protection laws unaffected, bu the provisions regarding consent afford consumers with the greatest possible safeguards against fraud imaginable. Consumers must opt-in to electronic transactions, receive full disclosure of terms and conditions, and ultimately prove that they can electronically access and retain the information that is the subject of the consent. I submit that in all my time in Congress, I have never seen a more involved statutory framework for purposes of manifesting consent.30 (Emphasis added.)

We urge the Board to state that electronic consumer consent has been effectively accomplished only when the consumer has electronically confirmed that he or she is able to open and read the TILA disclosure that has been provided electronically.

3. The Interim Rule must only permit consent in face-to-face transactions when the consumer supplies the computer equipment used to electronically consent.

In the proposed regulations on electronic disclosures the Board recognized the inherent risks to consumers who are asked to agree to receive electronic disclosures in face-to-face transactions. Is the Board no longer concerned about these risks? Not only were these risks apparent to Congress when it passed E-Sign, but the language of the electronic consent requirement is included as a mechanism of addressing these risks.

The statutory requirement that the consumer test his capacity to access the information is deliberately not testing the consumer's personal knowledge base - does the consumer know how to access a record electronically? The requirement tests the capacity of the consumer - does the consumer have access to the necessary hardware and software to receive the electronic disclosures?

In face-to-face transactions, this means that if the consumer uses the computer equipment provided by the business seeking consent, the consumer has not satisfied the requirement to demonstrate the ability to access electronic disclosures. In the Official Staff Commentary to § 226.36(b)(6)) the Board seems to assume that the consumer will have no trouble retaining disclosures accessed through equipment provided by the creditor so long as the "disclosures are sent to the consumer's e-mail address or ... made available at another location such as the creditor's Internet web site . . .." This completely ignores the very real possibility that some creditors will require that the consumer consent as a condition of the transaction (as is far too true with credit insurance, despite the separate disclosure box that the consumer must sign stating otherwise).31

The Board appears to contemplate that it would be legal for important TILA disclosures to be delivered to consumers standing in the creditor's place of business by posting them to a website which the consumer could access at later time, so long as the consumer electronically consents using the creditor's equipment. This is a complete misinterpretation of the electronic consent requirements of E-Sign. It simply establishes a new way to play "hide the ball" with essential consumer disclosures. It ignores the uselessness of making information available at the creditor's website if the consumer has no Internet access.

Instead, the Interim Rule should only permit electronic consent to be effectively accomplished in face-to-face transactions when the consumer uses equipment supplied by the consumer. This is the only way the Board can be assured that consumers -

In face-to-face transactions, E-Sign's consent requirement can be met only when the consumer uses equipment under the consumer's own control (such as a laptop or a other portable device). This is the only way that the consumer's actual capacity to access and retain the electronic record can be assured.

4. The Interim Rule should articulate the consequences of a failure of consumer consent

The Interim Rule should clearly state the consequences if the creditor has failed to satisfy the requirements for E-Sign's consumer consent. Some people have publically characterized E-Sign's electronic consent provision as simply a safe harbor. They have argued that a failure to comply fully with the consent provision did not, by itself, mean that the electronic delivery of records otherwise required to be in writing was not accomplished.

Allowing the consumer consent provision to be only a safe harbor is clearly wrong, and in derogation of the stated language in E-Sign as well as Congressional intent. The consumer consent provision in E-Sign establishes an "opt-in" regime. No records required to be in writing can be considered to be provided to a consumer if they were provided electronically, unless the consumer consented properly according to the requirements of 15 U.S.C. § 7001(c). The consequences of that lack of consent are whatever consequences there are in the underlying law for the failure to deliver documents required to be in writing to the consumer. For example, when TILA requires that a certain disclosure be provided to a consumer, then the electronic delivery of that disclosure is invalid if the consumer's consent did not comply with all of the requirements of 15 U.S.C. § 7001(c).

E-Sign specifically distinguishes between its treatment of contracts and other records required to be in writing. There is a very limited, but clear, difference in the treatment of electronic contracts and other records provided electronically to consumers in section 15 U.S.C. § 7001(c)(3), which says:

The legal effectiveness, validity, or enforceability of any contract executed by a consumer shall not be denied solely because of the failure to obtain electronic consent or confirmation of consent by that consumer in accordance with paragraph (1)(C)(ii). (Emphasis added).

This section indicates that the contract itself shall not be considered invalid just because the consumer did not electronically consent in conformance with the statutory requirement. So, for example, a contract which was delivered electronically despite the fact that the consumer did not electronically consent, may still be fully enforceable. The effect of the failure to electronically consent has the same effect as failing to provide a copy of the contract to the consumer. In some cases, there may be no consequences from this. A contract enforced under the statute of frauds, for example, must be in writing and signed by the person against whom enforcement is sought. But this contract does not need to have been provided to the person against whom it is being enforced.35 If a contract governed only by the statute of frauds were entered into electronically by a consumer and a business, and the consumer had not electronically consented, then the contract would not be deemed unenforceable just because of the failure to obtain the consumer's consent.36 However, if the underlying law requires the contract to be delivered to the consumer to be valid, then the fact that the consumer had not electronically consented would mean that the contract would not be valid. But the invalidity would flow from the fact that the contract had not been delivered to the consumer, not from the consent failure by itself.

There need not be such complex analysis applied to the situation where a consumer has failed to electronically consent to receive records which are not contracts. The legal requirement in E-Sign for a consumer's consent is only triggered by the requirement of another law for a document to be in writing. Therefore, if the consumer has not properly consented to the receipt of that writing electronically - by electronically consenting pursuant to section 15 U.S.C. § 7001(c)(1)(C)(ii) - the document cannot be considered to have been provided to the consumer. The consequences for not providing the document to the consumer are those that are specified in the underlying law. In TILA, this means that the consumer was not provided with the required TILA disclosure, triggering TILA damages and rescission, if applicable.

5. The Interim Rule wrongly allows some disclosures to be provided without prior consumer consent.

In a serious deviation from the requirements of the E-Sign law, the Interim Rule fails to require consumer consent to pre-application notices. There is no authority for this deviation from the law. In § 226.36(c), the Interim Rule allows a number of important, pre-transaction disclosures to be provided to consumers without E-Sign consent, and without requiring those disclosures to remain accessible to consumers for a period of time. These include disclosures in connection with applications for open and closed end credit, both unsecured and secured. There seems to be an implicit assumption that the consumer will obtain the information provided in the pre-application disclosures after the transaction is consummated. But if that were so, why would these disclosures currently be required to be in writing and provided to the consumer in a form the consumer can keep?

In fact, the disclosures provided pre-application are very important, and often provide essential information about the terms of the transaction. These disclosures were the basis upon which the consumer applied for the credit, and so must be available to the consumer so that once the credit is supplied, the terms can actually be checked against those disclosed before the application.

Clearly the pre-application disclosures "relate to a transaction" as is required for E-Sign's consumer consent to apply. All consumer notices and disclosures required to be in writing are covered by the consumer consent requirement. As the three leading Democratic Senators working on E-Sign specifically said about this provision:

The House bill included an amendment that required that consumers affirmatively consent before they can receive records (included required notices and disclosures and statements) electronically that are legally required to be provided or made available in writing. Special rules apply to electronic transactions entered into by consumers. It is the Congress' intent that the broadest possible interpretation should be applied to the concept of "consumer.'' The definition in Section 106(1) is intended to include persons obtaining credit and insurance, even salaries and pensions--because all of these are "products or services which are used primarily for personal, family or household purposes'' as the word is defined in the Act. (Emphasis added.)37

We are most concerned about the exclusion in the context of face-to-face transactions. If the exclusion for pre-application disclosures were limited to the situation where consumers were actually shopping on-line, it may make some sense. However, by allowing pre-application disclosures to be visually displayed on a computer screen to a consumer standing in a store applying for credit, we are inviting problems. That consumer might apply electronically, using the store's computer equipment, and consent electronically, also using the store's computer equipment to go to the store's website and click at the appropriate places. The consumer then leaves the store with no paper documents indicating the terms of the credit just entered into, and no information about the website, or how to access and download the disclosures. Even if the consumer wants to retain the pre-application disclosures, how would this be accomplished? The Interim Rule does not require any method of retention for these disclosures.38

While we do not object to the exclusion of advertisements from the requirement of consumer consent, we believe that the exclusion of pre-application disclosures is an illegal interpretation of E-Sign's consent provisions, particularly when applied to face-to-face transactions.

E. The Interim Rule completely ignores E-Sign's record retention and integrity requirements.

1. The electronic disclosure must be provided in a manner that the consumer can retain at the time the disclosure is provided.

When disclosures are provided electronically, consumers must be assured that they will have a way of keeping those disclosures to be used at another time. Also, the disclosures must be provided in a manner which would allow consumers to use the electronic record containing them to prove the terms of the disclosures in court, if necessary. As E-Sign wound its way through Congress there were several significant changes to it relating to document retention and integrity. These changes are reflected in § 7001(d) and (e), the provisions of which are not limited to consumer transactions. The Interim Rule has failed to require compliance with these sections. Consider subsection (e):

(e) ACCURACY AND ABILITY TO RETAIN CONTRACTS AND OTHER RECORDS-
Notwithstanding subsection (a), if a statute, regulation, or other rule of law requires that a contract or other record relating to a transaction in or affecting interstate or foreign commerce be in writing, the legal effect, validity, or enforceability of an electronic record of such contract or other record may be denied if such electronic record is not in a form that is capable of being retained and accurately reproduced for later reference by all parties or persons who are entitled to retain the contract or other record.

This means, among other things, that any disclosure required under TILA to be in writing must be provided to the consumer in a form which the consumer can retain. Providing a disclosure to a consumer in a face-to-face transaction, after the consumer consents using the creditor's equipment, by posting it on a website, and requiring the consumer to then go to another Internet access computer to find the appropriate link in the right website and download the disclosures does not meet these requirements. The visual display of TILA disclosures without a viable method at that moment for the consumer to download or print the disclosures is not providing the consumer an electronic record which is "capable of being retained."

The Board indicates in the Official Staff Commentary (§ 226.36(6)) in relation to this situation that the disclosures should be either a) sent to the consumer's email address, b) made available at another location, such as the creditor's website, or c) printable on a printer supplied. We believe that this requirement of E-Sign would be met if the disclosures are a) sent to the consumer's email address, or b) immediately printed. However, it must be clear that the consumer must have already established that email address. The Rule should plainly state that neither the creditor - or his agent - can establish an email address for the consumer.

We commend the Board for it definition of email address which excludes addresses only capable of receiving communications transmitted by the creditor (Official Staff Commentary § 226.36(d)(1)). However, when the agreement to receive electronic transactions is obtained in a face-to-face transaction there needs to be a further protection. As those situations are so fraught with the potential for abuse of the consumer, special protections are required and should be applied.

E-Sign's consumer consent requirement invalidates a consent which was obtained in a face-to-face transaction using the creditor's computer equipment in which the creditor establishes the email address for the consumer. Unless the consumer has previously established an email address which the consumer can access through the consumer's own computer or a public access computer which the consumer regularly uses (which is established by the fact that the consumer has already established an email address), the consumer's consent does not meet E-Sign's requirements. A consumer using a creditor's hardware and an email address established by a creditor in a face-to-face transaction cannot electronically consent "in a manner that reasonably demonstrates that the consumer can access information in the electronic form."

2. The electronic disclosure must be provided in a form which the consumer can use to accurately reproduce the disclosure to prove the terms at a later time.

E-Sign's language regarding record integrity is very different from the original language in E-Sign, and it is different from the requirements for writings in the Uniform Electronic Transactions Act (UETA). The differences made in the federal statute were deliberately inserted to ensure that recipients of electronic records were provided records they could actually retain and use at a later time. The E-Sign language goes beyond UETA's provision by putting the onus on the provider of the electronic record to prove its validity.

E-Sign's requirement for document integrity specifically requires that the electronic record be capable of being accurately reproduced for later reference by all parties.39 This should mean that the electronic record provided to the consumer should have the same legal viability as the electronic record retained by the creditor. Consumers must be provided a viable opportunity to keep the record, and the electronic record itself must be useful to the consumer. Senator Leahy specifically addressed this issue in the Conference Report on E-Sign:

[T]he conference report will ensure that electronic contracts and other electronic records are accurate and that relevant persons can retain and access them. Consumers must be able to retain electronic records and must have some assurance that they provide reasonable guarantees of the accuracy and integrity of the information that they contain.

Under section 101(e) of the conference report, the legal effect of an electronic contract or record may be denied if it is not in a form that can be retained and accurately reproduced for later reference and settlement of disputes. This means that the parties to a contract may not satisfy a statute of frauds requirement that the contract be in writing simply by flashing an electronic version of the contract on a computer screen. Similarly, product warranties must be provided to purchasers in a form that they can retain and use to enforce their rights in the event that the product fails. (Emphasis added).40

The Interim Rule should require when written disclosures are provided electronically, they must be in a form which the consumer can retain at same time the disclosure is provided. This means that if the consumer is in a face-to-face transaction, the disclosure must be either 1) downloaded to a device operated by the consumer, 2) printed immediately by the creditor and the paper copy handed to the consumer, or 3) e-mailed to the consumer at a pre-existing email address, which the consumer can access prior to proceeding with the transaction. Simply allowing the disclosure to be posted to a website for future downloading - if ever - by the consumer, does not provide the consumer with a viable opportunity to retain the disclosure in a form which the consumer could later use to resolve a dispute.

We must also consider the form of the electronic record which is provided. When a paper disclosure is provided, the consumer will have no trouble using that paper to prove the terms of the disclosure at a later time. The creditor however, could provide an electronic record of a disclosure which is so easy to alter that the downloaded version of the disclosure would be useless to the consumer in court. E-Sign's § 7001(e) forces the creditor to make a choice: either 1) provide the electronic record in a version which the consumer cannot inadvertently alter, or 2) retain and later use the same less secure version of the electronic record in court. The crucial point here is that the provider of the electronic record must provide to the recipient the same type of record which the provider will use to prove the terms of that record if a dispute arises later.41 The Board should specifically address this issue and mandate that the creditors follow the requirements for document integrity in E-Sign's § 7001(e).

III. Consumers' Specific Comments on the Interim Rule

Need for Exemptions

The Interim Rule requests comment on whether there is a need for the Board to exercise its exemption authority under section 104(d) of E-Sign. No exemptions should be adopted at this time. E-Sign requires that exemptions can be provided only if the exemption "will not increase the material risk of harm to consumers."42 Indeed, the exemptions allowed by the Interim Rule for "pre-transaction disclosures" to be delivered electronically without previous consumer consent conflict with E-Sign's requirement for opportunity for public notice and comment before any such exemptions are granted.43

§ 226.15 Right of Rescission (Open end credit)

It makes sense for the Interim Rule to require only one copy of the notice of rescission rights when the notice is delivered electronically. The purpose of requiring two copies in paper transactions is to enable to the consumer to keep one copy and use the other copy to cancel the transaction. Since an electronic document can be copied electronically while retaining the original, sending the consumer two copies is unnecessary. However, the Board should clarify that a consumer who electronically receives a notice of rescission may respond electronically or by paper, at the consumer's option. It would be grossly unfair if this were not allowed.

§ 226.17 General disclosure requirements

(g) Mail or telephone orders- delay in disclosures.

We commend the Board for limiting the delay in disclosures to situations where the request is by mail, telephone or facsimile machine, excluding the computer generated electronic transactions from this exemption. The delay may be justified when the communication is by telephone or fax. As the Board recognizes, electronic communication via computer allows for instant communication, and so no delay is necessary.

§ 226.23 Right of Rescission (Closed end credit)

It makes sense for the Board to require only one copy of the notice of rescission rights when the notice is delivered electronically. However, as discussed above in the context of open-end credit, the Board should clarify that a consumer who electronically receives a notice of rescission may respond electronically or by paper, at the consumer's option. It would be grossly unfair if this were not allowed.

In the proposed regulations issued previously, the Board recognized the inherent dangers to consumers in face-to-face transactions when their house secured the credit, and required paper copies of the electronically delivered disclosures and the notice of rescission. Have these dangers somehow disappeared? Is there no longer the same threat of coercive activity in face-to-face transactions that the Board recognized two years ago? The Board's current investigation of ways to address predatory mortgage practice underscores the importance of ensuring that consumers are not further victimized by unscrupulous lenders through electronic delivery.

The Board should prohibit consent in face-to-face transactions on the creditor's equipment and should specifically require all disclosures required by E-Sign, including the consumer's right to receive paper copies.

§ 226.27 Language of disclosures

It is helpful to consumers that the interim rule permits creditors to provide disclosures in languages other than English, as long as disclosures in English are available to consumers who request them. However, it would be even better to require that if the disclosures are given in a language other than English, they must also be provided in English. This would especially help elderly, monolingual consumers who may get advice from relatives, friends, or children who are far more literate in English than the senior's native language, In addition, the regulation should clearly state that this can only occur when the non-English disclosures are requested by the consumer or the transaction is negotiated in the language in which the disclosure is given.

§ 226.31 General Rules (High cost mortgages)

It is necessary for the Board to clarify that if a HOEPA loan is conducted electronically, that all co-owners must agree to receive electronic disclosures, and the HOEPA notice provided three days prior to closing 44 must be separately provided to each co-owner. Regulation Z already requires a separate notice to each co-owner in § 226.31(e).

§ 226.36. Requirements for electronic communications

(a) Definition. We commend the Board for limiting electronic communications to visual text messages. This corresponds with the requirement in E-Sign disqualifying oral communications or recordings from electronic records for consumers.45

(c) When consent is required. As we articulated above, in Section II.D.5 of these comments, we believe the exclusions for pre-transaction disclosures required by TILA to be in writing is not permitted under E-Sign's consent provisions. The consumer consent provisions of E-Sign are essential to protect consumers from the use of electronic commerce to facilitate fraud on consumers, and also to create a type of electronic handshake between the parties - a means to ensure that the electronic communication will be successful. The only reasonable exclusions from the consumer consent provisions are for advertisements.

When the communication between a consumer and creditor is truly electronic - rather than face-to-face - the consumer will have the opportunity to access and download the information provided electronically at the same time as the consumer consent is provided because the consumer will be using his own computer. Prior to actually agreeing to the transaction the consumer transacting business on line will be able to read and retain all the disclosures provided. This consumer will be able to ensure that the disclosures provided and kept electronically properly express the terms of the credit agreement, before the consumer executes the agreement.

However, the Interim Rule also permits a consumer to electronically consent to receive electronic disclosures in a face-to-face transaction. This situation is fraught with many more potentials for abuse, none of which the Board has recognized nor protected consumers from.

Assume a consumer walks into a car dealership to buy a car. The salesman says the price for the car is $10,000, so long as the consumer agrees to accept all records relating to the transaction electronically. The consumer points out he does not have a computer at home or work, and he certainly does not have an email address. The salesman assures the consumer that he can access his documents at any public library. He says that as the dealership printer is broken, if the consumer insists on paper, the car will be $500 more. If the high pressure sales tactics work, the consumer would electronically signs the contract and financing agreement on the creditor's computer as the Interim Rule would allow. Then this consumer drives away in his new car without a copy of the signed contract.

There could be two detrimental consequences from this scenario. The first is simply burdensome on the consumer. The second facilitates fraud.

No effective disclosures. At the least, the consumer will have the significant burden of finding a public access computer with the type of programs necessary to access the internet, figuring out what the dealerships' website is, and what the link is to the disclosures provided to him, open the electronically provided documents sent by the car dealer, and figure out how to download or print the disclosures. This is considerably easier to articulate then it is to do. In many public libraries in populous areas, there is a often a long wait to use computers with Internet access, and an even longer wait for computers attached to a working printer. Many consumers, particularly older consumers, low-income consumers, and recent immigrants, have never opened a file, used a mouse, or gone to a website. This required sequence of efforts is so burdensome that it is likely that many consumers simply will not procure the electronic copy of their paperwork. If and when there is a dispute with the car dealer, or the finance company, - months or years later - then the consumer will try to get a copy of the records. But if the consumer has failed to download the disclosures within the first 90 days - often well within a honeymoon period for a new car, or a new credit agreement, the records will no longer be accessible.

Some may ask what is the incentive of the car dealer in this scenario to avoid providing paper to the consumer. The answer is that in this case this car dealer will have complete protection from lawsuits alleging TILA violations. If consumers never secure a copy of the disclosures, consumers have no way to prove whether the dealer complied with TILA's requirements.

Expedites fraud. The more serious consequence to the consumer is the extent to which the potential for electronic provision of documents eases - even encourages - fraud while leaving a consumer without any reasonable means to prove it. In the car dealer scenario described above, when the consumer "signs" the documents electronically at the computer on the car dealer's desk, the consumer has not necessarily "locked" the document. In a paper transaction, the consumer would pen his name to a piece of paper, either several times, or once with carbon copies being automatically created. The dealer then signs, tears off the consumer's copy and hands the consumer his copy. The consumer takes that copy away with him when he drives off. But when the consumer electronically signs the contract at the dealership, and then the records are posted to a website by the dealer, the dealer has the opportunity to change the electronic record, after the signature was affixed. (There is nothing in either E-Sign or the Interim Rule which requires that the process of electronically signing a record would prevent alteration of that record.)

After the consumer leaves, the salesman could easily change the terms of the electronic contract, for example, by increasing the interest rate or not giving the consumer credit for the trade-in. If the consumer later objects, he has absolutely no basis on which to contest the electronic contract, because the electronic record was not locked when he signed, and he walked away with no paper copies of the agreement that he agreed to. Even if the documents are not altered, providing them electronically makes it much easier to slip onerous terms past the consumer, who may not see the entire document on the screen at the dealership and will not have a paper copy to review.

E-Sign's consumer electronic consent provisions should clearly prevent both of these scenarios from taking place. However, the Board has wrongly interpreted E-Sign's provisions to allow this activity to occur. Congress intended to prohibit just this scenario by requiring electronic consent "in a manner which reasonably demonstrates that the consumer can access information in an electronic form." A consumer who is in a face-to-face transaction should not be able to consent electronically by using the computer equipment belonging to the seller. That consent does not meet E-Sign's requirement that the electronic consent demonstrate "that the consumer can access information in the electronic form." As Senator McCain said, "[t]his should mean that the consumer must initiate or respond to an email to consent or confirm consent."46 Congressional statements by the sponsors of this legislation indicate that the only rational reading of E-Sign's strict requirements for consent would prohibit this activity.47

(d) Address or location to receive electronic communication.

The Interim Rule allows electronic disclosures to be provided to consumers either by e-mailing them to a consumer, or posting them on a web site and notifying the consumer by email or otherwise of their availability on the web site.

We believe that there are only two ways, not three, to provide electronic notices to consumers. Both ways require the use of a consumer's email address. The creditor either 1) emails the consumer and includes the notice in the body of the email or as an attachment, or 2) emails the consumer and provides a weblink in the body of the email to the specific notice posted on the creditor's website.

Receipt of and access to electronic disclosures should be no more difficult for consumers than receiving paper disclosures. Electronic disclosures are designed to facilitate commerce, not to provide a method for creditors to avoid giving consumers disclosures in a manner which they actually read or keep.

(1) Email address. The Board correctly notes in its Official Staff Commentary that the email address to which the creditor sends notices must be established for general purposes and not just for the purpose of receiving communications from the creditor. However, for the reasons articulated in section II.E.1 above, when electronic disclosures are agreed to in face-to-face transactions, the creditor should also be prohibited from establishing the email address.

(2)(i) Notice of disclosure posted on a web site may be sent to the consumer at a postal address

The Interim Rule permits creditors to replace a notice which must under TILA be in writing and provided to the consumer, by notifying a consumer by mail that there is an important notice they must retrieve by going to a certain place on the creditor's website. What is the rationale for this?

It is likely that creditors will be mailing these notices to consumers whose email has bounced back to the creditor. If their email has bounced back, that is a good indication that the consumer no longer has Internet access. That situation should automatically trigger a reversion to physical world delivery (with the concomitant, but reasonable costs associated with this change in delivery systems). It would be grossly unfair, and clearly in violation of the consumer protection purposes of TILA, to allow creditors to continue to post notices electronically when there is no reason to believe that the consumers has Internet access.

As the discussion in Section II.A of these comments points out, over 10% of the households connected to the Internet in one year will no longer be connected the following year. We cannot assume that electronic communication is as ubiquitous in U.S. households around the nation as it is in the halls of government in the nation's capital.

It simply makes no sense to allow a creditor mail a notice of a notice to a consumer! Why not just include the TILA notice itself in the mail?

Finally, even assuming the household continues to enjoy Internet access, it is necessary to consider the difficulty that even the most computer literate consumer would undergo to access the particular web site where the proper notice would be displayed. The consumer would be required to a) turn on the computer, b) dial up the Internet access and wait for connection, c) connect to the Internet, d) type in perfect order the potentially dozens of letters and numbers (some Internet links have two or more lines in the web address), and e) download or print the disclosure. This exercise would all be unnecessary if the creditor simply included the notice in the same envelope that was used to send the notice of the notice. Allowing creditors to replace paper notices with a procedure which requires this multiplicity of tasks defeats the purpose of TILA's underlying requirement for the notice.

(ii) Disclosure must be available for 90 days. TILA requires a number of essential disclosures to be provided to consumers prior to, contemporaneous with, and after, consummation of the transaction. These disclosures are currently required to be provided to consumers in a form that they can look at, study, and keep for future use. The Board contemplates with this regulation that creditors will be permitted to ask consumers in face-to-face transactions to agree to electronic disclosures, and receive their disclosures electronically. There are numerous practical - as well as legal - problems with this scenario.

We believe that the posting of disclosures on a website should only be permitted when it is accompanied by an emailed notice to the consumer which includes a weblink to the website disclosures. Even in this limited instance, there is no reason to limit the time that these disclosures will be available to the consumer to 90 days.

E-Sign's section 7001(d) specifically requires that electronic records must "remain accessible to all person who are entitled to access by statute, regulation, . . . for the period required by such statute . . .." If electronic records are replacing paper writings required to be provided to consumers under TILA, then those electronic records must remain accessible to consumers for the entire time for which the consumer is bound or affected by those records. The electronic provision of that record - posting it on the website - replaces providing the paper copy to the consumer. If the consumer has the right under TILA to receive the record in a form the consumer can keep, then the electronic posting of that record must remain available for the entire time the consumer might need the record. Any other standard makes receiving electronic records more burdensome for the consumer, and less protective, than paper records. The purpose of E-Sign, and presumably the purpose of the Board's regulations on electronic disclosures, is to provide equivalent legal status to electronic records, not to make using electronic records more difficult then their paper equivalents.

(3) Exceptions. In this subsection the Interim Rule allows pre-application disclosures to be posted to a website, and does not require that the consumer be notified of the disclosures or that they remain on the website for a period of 90 days. Again the discussion regarding the viability of this exception turns on the method of communication between the creditor and the consumer.

If the parties are communicating electronically, and the consumer had the opportunity to access and download these disclosures prior to executing the credit agreement, it may not be necessary to provide a separate notice to the consumer that the disclosures are posted on a website. However, once posted on the website, they should be left there for the entire time that the consumer is bound by the credit agreement which they described.

If the parties are communicating in a face-to-face transaction, it becomes particularly important that the consumer have a viable opportunity to retain the actual pre-application disclosures provided. In this instance, the disclosures should be required to be printed out and handed to the consumer or emailed to the consumer at a pre-existing email address, prior to the execution of the credit agreement.

(e) Redelivery. The Board has bent over backwards to make it easy for creditors to satisfy their obligations under TILA, without adding new requirements to ensure that consumers actually receive electronic disclosures. The Interim Rule provides a minimal standard for redelivery of bounced back email - but doesn't require redelivery if all other signs (such as non-payment) indicate that the consumer may not be actually receiving the electronic communications. The Interim Rule does not even require the creditor to conduct a periodic testing to ensure that consumers are still receiving email at addresses established months or years before.48

There are many technological advantages to creditors and consumers alike from electronic delivery of notices. One of these advantages is that there are numerous technological methodologies which enable the sender of an electronic record to determine if the recipient of the record actually accessed it.49 The program built into the ubiquitous Microsoft Outlook which allows senders to ascertain that emails have appeared on the recipient's screen, is just one of a multitude of similar technologies.50

The purpose of TILA is to provide information to consumers. If there is a fairly easy and inexpensive way to ensure that consumers actually receive this information, especially when ongoing access to electronic notices remains an expensive and illusive proposition for the majority of households in the nation,51 that methodology should be required.

We propose that the following be added to the redelivery requirement in § 226.36(e).

Disclosures shall be considered electronically delivered to the consumer only when the email to the consumer including the notice (or the weblink to the notice) is acknowledged, or automatically acknowledged by a flag that tells the sender it has been opened.

The recommended language gives two ways to trigger effectiveness of a notice: 1) manual acknowledgment or 2) a technological automatic acknowledgment received by the sender.52 This is technologically possible, easy, and fair. It would go a long way to ensure that electronic communications benefit consumers as much as they benefit creditors.

IV. Conclusion and Recommendations

We are disappointed with the Board's Interim Rule on electronic disclosures. The Board appears to have substantially ignored the consumer protection purposes of E-Sign, to have stepped back from several important protections articulated in previous proposals, and to have disregarded Congressional intent to protect consumers evidence in E-Sign.

We request the Board to immediately withdraw this Interim Rule and rewrite it with the following changes:

1) In face-to-face transactions, consumers cannot "reasonably demonstrate" their ability to access information in the electronic form unless they are using hardware under their own control. (This requirement simply implements the protections in E-Sign's requirement for consumer electronic consent.)

2) All disclosures required to be provided to consumers in writing under TILA, including all pre-application disclosures, can only be considered provided electronically if the consumer has consented electronically to receiving them. (This simply implements the requirements of E-Sign's consumer consent provisions, § 7001(c)(1))

3) A consumer consent is only valid when it is accompanied by a disclosure of all the terms required by E-Sign's § 7001(c)(1), including the consumer's right to request a paper copy. (This is E-Sign's requirement, which should be reiterated in the Interim Rule.)

4) All disclosures required to be provided to consumers must be emailed to the consumer or posted on a website, after the consumer has received an email which includes a weblink to the disclosure. (As delivery requirements were not addressed by E-Sign, it simply implements in a reasonable way the consumer protections purposes of TILA that consumers actually receive and are able to retain the TILA disclosures required to be provided to them.)

5) Disclosures which are provided on a website, rather than emailed to the consumer, must either be left on the website, or otherwise made available to the consumer, for the duration of the transaction between the parties. (This provision implements E-Sign's requirements on document retention in§ 7001(d).)

6) Disclosures electronically delivered to a consumer should only be considered delivered a) when the creditor can determine that the consumer has accessed the weblink containing the disclosure, or b) the consumer acknowledges receipt of an email, or c) an automatic acknowledgment notifies the creditor that the consumer has opened the email. (As delivery criteria were entirely omitted from E-Sign, this requirement simply implements TILA's consumer protection purposes of ensuring the required disclosures actually be provided to consumers. It recognizes that ongoing access to electronic communications remains considerably less definite for many households in this nation.)

7) When HOEPA notices are delivered electronically, each co-owner must consent to receive the disclosure electronically, and each co-owner must receive a notice. This simply implements the current requirements of § 226.31(e).

8) Disclosures electronically delivered to a consumer must be provided in an electronic format which the consumer can retain, and can accurately reproduce at a later time. (This means that if the creditor provides disclosures to a consumer in an electronic format which can be altered, the creditor cannot later complain in a court proceeding that that electronic format does not meet evidentiary requirements to prove the terms of the record.) (This simply implements the requirements of E-Sign's § 7001(e) on document integrity.)

9) Creditors should be required to produce paper copies of electronically delivered disclosures at any time during the term of the credit agreement between the parties; a reasonable charge may be assessed for these paper copies. (This specifically implements the requirements of E-Sign's consent provision mandating that paper copies be allowed, in § 7001(c)(1)(B)(iv).)

10) Consumers should be clearly permitted to electronically respond to notices electronically provided to consumers. (This seems a matter of basic equity - to make electronic disclosures equally useful to consumers and creditors - which was mandated in the Board's previous iterations of rules on electronic disclosures but for some reason was not included in the Interim Rule.)

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1 The National Consumer Law Center is a nonprofit organization specializing in consumer issues on behalf of low-income people. We work with thousands of legal services, government and private attorneys, as well as community groups and organizations, from all states who represent low-income and elderly individuals on consumer issues. As a result of our daily contact with these advocates, we have seen examples of predatory practices against low-income people in almost every state in the union. It is from this vantage point - many years of dealing with the abusive transactions thrust upon the less sophisticated and less powerful in our communities - that we supply these comments. We have led the effort to ensure that electronic transactions subject to both federal and state laws provide an appropriate level of consumer protections. We publish and annually supplement twelve practice treatises which describe the law currently applicable to all types of consumer transactions. These comments are written by Margot Saunders, Managing Attorney of NCLC's Washington office.

2 Consumers Union is the publisher of Consumer Reports.
The Consumer Federation of America is a nonprofit association of over 280 pro-consumer groups, with a combined membership of 50 million people. CFA was founded in 1968 to advance consumers' interests through advocacy and education.
The Consumer Law Center of the South is a non-profit, public interest organization, incorporated in Georgia in 1995. The Center's mission is to advocate for consumer protection through consumer education, legislative reform, involvement in the regulatory process and litigation and support. Professor Mark Budnitz of Georgia State College of Law is the Chairman of the Board.
The National Association of Consumer Advocates (NACA) is a non-profit corporation whose members are private and public sector attorneys, legal services attorneys, law professors, and law students, whose primary focus involves the protection and representation of consumers. NACA's mission is to promote justice for all consumers.
The National Consumers League, is America's pioneer consumer organization. NCL is a private, non-profit membership organization dedicated to representing consumers.
The U.S. Public Interest Research Group is the national lobbying office for state PIRGs, which are non-profit, non-partisan consumer advocacy groups with half a million citizen members around the country.
Community Legal Services , Inc. is a nonprofit legal aid organization that represents low-income consumers in Philadelphia at no charge. CLS represents thousands of individuals who receive Truth in Lending disclosures in the course of consumer credit transactions. CLS also represents the Association of Community Organizations for Reform Now ("ACORN"), a membership advocacy group of low-income citizens concerned, among other things, about the predatory lending epidemic. CLS is offering this comment both on behalf of its individual clients and on behalf of ACORN.

3 15 U.S.C. § 7001 et seq.

4 15 U.S.C. § 7001(c)(1)(B)(iv).

5 15 U.S.C. § 7004(b)(2)(B) prohibits a federal agency from adopting a regulation which adds to the requirements of § 7001.

6 U.S. Department of Commerce, Economic and Statistics Administration & National Telecommunications and Information Administration, "Falling Through the Net: Toward Digital Inclusion" A Report on Americans' Access to Technology Tools," October, 2000. Figure II-13.

7 Id. in Executive Summary.

8 Id. in Figure II-13.

9 Id. in Executive Summary.

10 Id. in text accompanying Figure I-18.

11 Id. in Part One -- Overall Household Findings.

12 Actually, if one compares the drop off rate in the year 2000 to the number of households which were on line during the previous year, which may be the better comparison, this ratio will be higher. However, we do not have the number of households which had Internet access the previous year, only the percentage.

13 It is conceivable that the consumer without regular access to a computer with a hard disc could use a floppy disk or a CD to retain important electronic records. But this requires access to a computer on which to download the records onto the floppy when they are received, and access to a computer with similar capabilities to access the electronic records at a later time when they are needed.

14 U.S. Department of Commerce, Economic and Statistics Administration & National Telecommunications and Information Administration, "Falling Through the Net: Toward Digital Inclusion" A Report on Americans' Access to Technology Tools," October, 2000. Part One -- Overall Household Findings.

15 §226.36(c).

16 Official Staff Commentary § 226.36(b)(6).

17 § 226.36(e).

18 15 U.S.C. § 7001(c)(1)(B)(iii).

19 See discussion of extensive software technologies available which provide automatic acknowledgment that the recipient of an email has opened it, in Section III, regarding Interim Rule § 226.36(e).

20 §226.36(d)(3).

21 § 226.(d)(2)(i).

22 146 Cong. Rec. S5219-5222 (daily ed. June 15, 2000) (statement of Sen. Leahy).

23 For example, in the commentary consistently makes reference to "on-line credit shopping."

24 All open end disclosures required pre-application are allowed to be provided without electronic consumer consent. § 226.5a.

25 Pre-application disclosures provided under home equity credit plans are also exempted. § 226.5b(d) and (e); as information provided for closed end home secured credit. § 226.17(g); § 226.19(b).

26 Retention of the information provided pre-application in this situation is very important. For example, one very large home improvement chain typically provides on the spot credit to customers based on the promise that no interest and no payments will be required for six months. Yet, customers have found that interest is actually assessed after four months. Only when the customers call and point to the promises made in the disclosures received pre-application are the interest charges removed from the account. In this scenario, even very careful consumers would be unable to provide that necessary proof of the terms of the original agreement, because they would have no electronic or paper record of the disclosures.

27 Electronic Signatures in Global and National Commerce Act, ("E-Sign") 15 U.S.C. § 7001(c)(1)(C)(ii).

28 Id.

29 146 Cong. Rec. S 5229-5230 (daily ed. June 15, 2000) (statement of Sens. Hollings, Wyden and Sarbanes).

30 146 Cong. Rec. H4360 (daily ed. June 14, 2000) (statement of Mr. Tauzin).

31 Equity Predators: Stripping, Flipping and Packing Their Way to Profits: Hearing before the Special Committee on Aging United States Senate, 105th Cong. 2d Sess. 33-34, Serial No. 105-18 (Mar. 16, 1998) (statement of Jim Dough, former employee of predatory lender). Allegations of coercion in the sale of what is supposed to be a "voluntary"" product have been the subject of federal enforcement cases and private litigation. In re USLIFE Credit Corp. & USLIFE Corp., 91 FTC 984 (1978), modified on other grounds 92 FTC 353 (1978), rev''d 599 F.2d 1387 (5th Cir. 1979); Lemelledo v. Beneficial Management, 674 A.2d 582 (N.J. Super. Ct. App. Div. 1996), aff'd on other grounds, 696 A.2d 546 (N.J. 1997).

32 In the 1999 proposed regulations on electronic disclosures the Board recognized the potential coercive opportunities for creditors to insist that consumers accept electronic disclosures.

33 As is required by E-Sign's 15 U.S.C. § 7001(c)(1)(C)(ii).

34 As is required for any electronic disclosures provided to consumers which replace writings. TILA requires disclosures to be provided to consumers in a form consumers can keep and E-Sign requires that consumers must be able to retain electronic records replacing written records provided to them. See 15 U.S.C. § 7001(c)(1)(C)(i) and § 7001(c)(1)(D) requiring a new electronic consumer consent if a change in the hardware or software requirements needed to access or retain electronic records creates a material risk that the consumer will not be able to access or retain a subsequent electronic record that the was the subject of the consent. (Emphasis added.)
It certainly makes no sense to interpret E-Sign's requirement for consumer consent to test the consumer's capacity to retain documents only in the event of a second consent, but not in the first consent. Clearly, the first consent process must ensure that the consumer has the capacity to retain the electronic records as well.

35 See e.g. U.C.C. § 2-201. Formal Requirements; Statute of Frauds
(1) . . .A contract for the sale of goods for the price of $500 or more is not enforceable by way of action or defense unless there is some writing sufficient to indicate that a contract for sale has been made between the parties and signed by the party against whom enforcement has been sought . . . .

36 However, the fact that the consumer had not electronically consented could be raised to show that there had not been a meeting of the minds, or that the electronic signature did not actually belong to the consumer. There would be no bar against the consumer making some other argument to show that the contract could not be enforced against him. However, in many states, the failure to provide a copy of a small loan contract to a consumer carries the statutory consequence that the contract may be unenforceable against the consumer. (See e.g. the law in North Carolina governing small consumer loans: "(a) At the time a loan is made, the licensee shall deliver to the borrower . . a copy of the loan contract . . . " N.C.G.S. § 53-181.)

37 146 Cong. Rec. S 5229-5230 (daily ed. June 15, 2000) (statement of Sens. Hollings, Wyden and Sarbanes).

38 § 226.36(d)(3).

39 E-Sign 15 U.S.C. § 7001(e).

40 146 Cong. Rec. S 5219-5222 (daily ed. June 15, 2000) (statement of Sen. Leahy).

41 This requirement should be articulated in 226.36(b)(5).

42 15 U.S.C. § 7003(c)(2).

43 Id.

44 15 U.S.C. § 1639(b).

45 15 U.S.C. § 7001(c)(6).

46 146 Cong. Rec. S5219-5222 (daily ed. June 15, 2000) (statement of Sen. McCain).

47 Subsection (c)(1)(C)(ii) requires that the consumer's consent be electronic or that it be confirmed electronically, in a manner that reasonably demonstrates that consumer will be able to access the various forms of electronic records to which the consent applies. The requirement of a reasonable demonstration is not intended to be burdensome on consumers or the person providing the electronic record, and could be accomplished in many ways. For example, the "reasonable demonstration" requirement is satisfied if the provider of the electronic records sent the consumer an email with attachments in the formats to be used in providing the records, asked the consumer to pen the attachments in order to confirm that he could access the documents, and request the consumer to indicate in an emailed response to the provider of the electronic records that he or she can access information in the attachments. . . . The purpose of the reasonable demonstration provision is to provide consumers with a simple and efficient mechanism to substantiate their ability to access the electronic information that will be provided to them.
106th Congress, 146 Cong. Rec. H4352-4353 (daily ed., June 14, 2000) (statement of Cong. Bliley).

48 See discussion on the differences between physical world delivery and electronic delivery in section II.C, infra.

49 Just a few examples of the available technology include:
http://www.readnotify.com/
http://www.electradoc.com/emailetes.html
http://www.drakken.com/email.htm
http://www.cs.bc.edu/~osbornk/reply/
http://www.greenbaycd.com/emailp.html
http://www.slipstick.com/addins/auto.htm
http://www.msbcd.com/cds4sale/23246.html

50 For example, in just one of the dozens of websites which listed software that provided automatic acknowledgment of a recipient's opening of an email (http://www.sharewareplace.com/file_pc/int_mail.htm) the following was explained:
Description: The G-Lock EasyMail was developed to help people run and manage mailing lists, newsletters, announcement lists and customer updates and other legal uses. G-Lock EasyMail is a powerful group mailer which sends your message directly from your outbox to the recipient's mail server (without using any ISP's SMTP server). This takes the load off of your mail server and speeds up message sending significantly. It gives instant confirmation of delivery by checking the address before it sends, which eliminates the dreaded "Mail undeliverable" messages you can get. It can also get confirmation that your message has been read.

51 Only 41.5% of all households can access the Internet from their home. U.S. Department of Commerce, Economic and Statistics Administration & National Telecommunications and Information Administration, "Falling Through the Net: Toward Digital Inclusion" A Report on Americans' Access to Technology Tools," October, 2000. Figure II-13.

52 We recommend that, as an additional question to be addressed, the FTC and the Department of Commerce seek information about the cost, availability, and effectiveness of technological automatic acknowledgment systems.