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Scottrade Bank (also referenced as “we,” “us” and “our”) is making important changes to the Scottrade Bank
Account Agreement. These changes are intended to provide the account holder (also referenced as “you” and
“your”) additional information, clarify several areas, and improve readability. On or after April 27, 2017, the
following changes will be made:
Account Agreement Changes (additional/replacement statements italicized)
1. AGREEMENT
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• We have changed the contact for questions in relation to the Scottrade Bank Account Agreement from your
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local Scottrade brokerage branch office to Scottrade Bank Support at 855.265.2265.
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o This change allows you to reach Scottrade Bank subject matter experts more quickly.
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• Added clarification to inform you that nothing in the Scottrade Bank Account Agreement is intended to vary
our duty to act in good faith and with ordinary care when required by law.
o This clarification draws attention to the legal requirement for Scottrade Bank to act in good faith.
3.
DEPOSITS
• We added clarification of our current practices, stating that unless prohibited by law, we also reserve the right
to charge back to your account the amount of any item deposited to your account which was initially paid by
the payor bank and which is later returned to us due to allegedly forged, unauthorized or missing
endorsement, claim of alteration, encoding error or other problem which in our judgment justifies reversal of
credit. You authorize us to attempt to collect previously returned items without giving you notice, and in
attempting to collect we may permit the payor bank to hold an item beyond the midnight deadline.
o This clarification is designed to draw your attention to our chargeback processes, specifically when a
credit to your account is returned to Scottrade Bank for the reasons listed. We also state our process
to pursue collection of items from other institutions without notice to you.
• We added clarification of our current practices, stating that if you deliver multiple items to us for deposit you
must provide us an itemized list of the deposit (deposit slip). To process the deposit, we will verify and record
the deposit, and credit the deposit to the account. If there are any discrepancies between the amounts shown
on the itemized list of the deposit and the amount we determine to be the actual deposit, we will notify you of
the discrepancy. You will be entitled to credit only for the actual deposit as determined by us, regardless of
what is stated on the itemized deposit slip.
o This clarification describes our process for the handling of deposits including multiple items and for
discrepancies in deposited amounts.
4. WITHDRAWALS
Checks and withdrawal rules
• We added clarification of our current processes, stating an item may be returned after the funds from the
deposit of that item are made available for withdrawal. In that case, we will reverse the credit of the item.
o This clarification describes the potential for the reversal of deposited items, even after credit has been
given.
Notice of withdrawal
• We added clarification regarding demand deposit accounts as being included in our ability to reserve the right
to require not less than 7 days’ notice in writing before each withdrawal from an interest-bearing account other
than a time deposit or demand deposit, or from any other savings account as defined by Regulation D. (The
law requires us to reserve this right, but it is not our general policy to use it.)
o This clarification states demand deposit accounts are not included as an account type for which we
may require advanced notice for withdrawals.
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9. STATEMENTS
Your duty to report other errors
• We added clarification of our current processes, stating if you receive or we make available either your items
or images of your items, you must examine them for any unauthorized or missing endorsements or any other
problems.
o This clarification relays the importance of reviewing transactional items to ensure issues are reported
timely.
• We added clarification of our current process, stating failure to examine your statement and items and report
any such errors to us within 60 days of when we first make the statement available precludes you from
asserting a claim against us for any errors on items identified in that statement and as between you and us
the loss will be entirely yours.
o This clarification was made in order to expand your review to also include non-statement items we
provide in order to ensure issues are reported timely.
• We added clarification of our current process, stating if a good reason (such as a long trip or a hospital stay)
kept you from telling us, we will extend the 60-day time period to report other errors.
o This clarification better explains the allowance of extenuating circumstances within the issue-reporting
timeframe.
12. SETOFF
• We removed the sentence stating “by any of you having the right of withdrawal, to the extent of such persons’
or legal entity’s right to withdraw. If the debt arises from a note, ‘any due and payable debt’ includes the total
amount of which we are entitled to demand payment under the terms of the note at the time we set off,
including any balance the due date for which we properly accelerate under the note.” The aforementioned
sentence was replaced by the following clarifying statement, “If this account is owned by one or more of you
as individuals, we may set off any funds in the account against a due and payable debt a partnership owes us
now or in the future, to the extent of your liability as a partner for the partnership debt. If your debt arises from
a promissory note, then the amount of the due and payable debt will be the full amount we have demanded,
as entitled under the terms of the note, and this amount may include any portion of the balance for which we
have properly accelerated the due date.”
o This clarification was added to better describe the handling of your account, should it become a debt,
payable to Scottrade Bank.
• We added the description of your rights, if applicable, regarding the Military Lending Act by clarifying “For
example, the right of setoff does not apply to this account if: (a) it is an Individual Retirement Account or
similar tax-deferred account, or (b) the debt is created by a consumer credit transaction under a credit card
plan (but this does not affect our rights under any consensual security interest), or (c) the debtor’s right of
withdrawal only arises in a representative capacity, or (d) setoff is prohibited by the Military Lending Act or its
implementing regulations.”
o This clarification was required due to recent implementation of the Military Lending Act, which
contains certain prohibited setoff actions against debt incurred by applicable account holders.
15. PAYMENT ORDER OF ITEMS
• We added clarification regarding the manner by which transactions clear your account by stating “transactions
may not be processed in the order in which they are initiated by you. The order in which transactions are
received and processed by us can affect whether or not you incur an overdraft or an NSF fee and can also
affect the total amount of overdraft or NSF fees you incur.”
o This clarification was provided to help you better understand transaction processing and help you to
avoid potential fees.
• We changed the language of the sentence stating “If an item is presented without sufficient funds in your
account to pay it, we may, at our discretion, pay the item (creating an overdraft and subsequent overdraft fee)
or return the item (creating an insufficient funds (NSF) fee)” to add clarification and read as, “If a check or
transaction is presented without sufficient funds in your account to pay it, we may, at our discretion, pay the
item (creating an overdraft and subsequent overdraft fee) or return the item (creating an insufficient funds
(NSF) fee).”
o This clarification was added to provide better terminology regarding insufficient funds.
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17. CHECK PROCESSING
• We changed the language of the sentences stating “You agree that we have not failed to exercise ordinary
care solely because we use our automated system to process items and do not inspect all items processed in
such a manner. Using an automated process helps us keep costs down for you and all account holders” to
add clarification of our current process and read as, “You agree that we have exercised ordinary care if our
automated processing is consistent with general banking practice, even though we do not inspect each item.
Because we do not inspect each item, if you write a check to multiple payees, we cannot guarantee your
instructions will be honored.”
o This change is designed to draw your attention to our automated check processing and the likelihood
that special instructions you write on a check may not be honored.
19. DEATH OR INCOMPETENCE
• We replaced all references to an account holder becoming or being declared as legally incompetent to the
adjudication of incompetence, such as determined by the appropriate official.
o This clarification was added in order to better describe the process that must occur in order for a
client to be declared as incompetent. It is a descriptive change only.
20. FIDUCIARY ACCOUNTS
• We added the following statement, “We are not responsible for the actions of a fiduciary, including misuse of
funds.”
o This statement further clarifies the responsibility of the account holder when a fiduciary has been
provided access to the account by the account holder.
28. WAIVER OF NOTICES
• We replaced the following sentence, “You waive any notice of non-payment, dishonor, or protest regarding
any items credited to or charged against your account” with, “To the extent permitted by law, you waive any
notice of non-payment, dishonor or protest regarding any items credited to or charged against your account.
For example, if you deposit a check and it is returned unpaid or we receive a notice of nonpayment, we do not
have to notify you unless required by federal Regulation CC or other law.”
o This clarification explains our legal limitation with enforcing the waiver and also provides an example
situation.
31. NOTICES
• We added a new section regarding notices you provide to us and notices we provide to you. It states, “Any
written notice you give us is effective when we actually receive it, and it must be given to us according to the
specific delivery instructions provided elsewhere, if any. We must receive it in time to have a reasonable
opportunity to act on it. If the notice is regarding a check or other item, you must give us sufficient information
to be able to identify the check or item, including the precise check or item number, amount, date and payee.
Written notice we give you is effective when it is emailed to you using the email address on file or deposited in
the United States Mail with proper postage and addressed to your mailing address we have on file. Notice to
any of you is notice to all of you.”
o This section explains our capacity and any corresponding limitations of our capacity to act on notices
you provide to Scottrade Bank. We also explain the point at which our notice to you becomes
effective.
32. PROTECTION OF INFORMATION
• We added a new section regarding the importance of protecting private and personal information, as well as
information allowing account access by stating the following:
“It is your responsibility to protect the account numbers and electronic access devices (e.g., an ATM card) we
provide you for your account(s). Do not discuss, compare, or share information about your account number(s)
with anyone unless you are willing to give them full use of your money. An account number can be used by
thieves to issue an electronic debit or to encode your number on a false demand draft which looks like and
functions like an authorized check. If you furnish your access device and grant actual authority to make
transfers to another person (a family member or coworker, for example) who then exceeds that authority, you
are liable for the transfers unless we have been notified that transfers by that person are no longer authorized.
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“Your account number can also be used to electronically remove money from your account, and payment can
be made from your account even though you did not contact us directly and order the payment.
“You must also take precaution in safeguarding your blank checks. Notify us at once if you believe your
checks have been lost or stolen. As between you and us, if you are negligent in safeguarding your checks,
you must bear the loss entirely yourself or share the loss with us (we may have to share some of the loss if
we failed to use ordinary care and if we substantially contributed to the loss).
“Except for consumer electronic funds transfers subject to Regulation E, you agree that if we offer you
services appropriate for your account to help identify and limit fraud or other unauthorized transactions
against your account, such as positive pay or commercially reasonable security procedures, and you reject
those services, you will be responsible for any fraudulent or unauthorized transactions which could have been
prevented by the services we offered, unless we acted in bad faith or to the extent our negligence contributed
to the loss. If we offered you a commercially reasonable security procedure which you reject, you agree that
you are responsible for any payment order, whether authorized or not, that we accept in compliance with an
alternative security procedure that you have selected.
“Account numbers - Thieves can encode your account number on a check which looks and functions like an
authorized check and can be used to withdraw money from your account. Your account number can also be
used to issue a “remotely created check.” Like a typical check, a remotely created check (sometimes called a
telecheck, reauthorized draft or demand draft) is a draft or check that can be used to withdraw money from
your account. Unlike a typical check or draft, however, a remotely created check is not issued by the paying
bank and does not contain the signature of the account owner (or a signature purported to be the signature of
the account owner). If you have truly authorized the remotely created check (to purchase a service or
merchandise, for example), it is properly payable. But it can be risky to authorize a remotely created check. A
swindler could issue a remotely created check in an amount greater than you authorized, or issue additional
remotely created checks that you have not authorized. We will not know if the withdrawal is unauthorized or in
an amount greater than the amount you have authorized. Payment can be made from your account even
though you did not contact us directly and order the payment.
“Access devices - If you furnish your access device and grant actual authority to make transfers to someone
who then exceeds that authority, you will be liable for the transfers unless we have been notified that transfers
by that person are no longer authorized. Please review the additional information found elsewhere in this
Agreement regarding transfers by access device.
“Blank checks - You must also take precaution in safeguarding your blank checks. Notify us at once if you
think your blank checks have been lost or stolen. As between you and us, if you are negligent in safeguarding
your checks, you must bear the loss entirely yourself, or share the loss with us if we failed to use ordinary
care which substantially contributedto the loss.”
o This section was added to provide information regarding the safekeeping of your personal and
account information. The section also describes your responsibilities in safeguarding your account
and the means by which others can access your account by your permission, along with the risks by
allowing such activity.
33. MONITORING AND RECORDING TELEPHONE CALLS AND CONSENT TO RECEIVE COMMUNICATIONS
• We added a new section regarding our monitoring and recording of phone calls by stating the following:
“We may monitor or record phone calls for security reasons, to maintain a record and to ensure that you
receive courteous and efficient service. You consent in advance to any such recording. We need not remind
you of our recording before each phone conversation.
“To provide you with the best possible service in our ongoing business relationship for your account we may
need to contact you about your account from time to time by telephone or email. However, we must first
obtain your consent to contact you about your account because we must comply with the consumer protection
provisions in the federal Telephone Consumer Protection Act of 1991 (TCPA), CAN-SPAM Act and their
related federal regulations and orders issued by the Federal Communications Commission (FCC).
“• Your consent is limited to this account, and as authorized by applicable law and regulations.
• Your consent does not authorize us to contact you for telemarketing purposes (unless you otherwise agreed
elsewhere).
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“With the above understandings, you authorize us to contact you regarding this account throughout its
existence using any telephone numbers or email addresses that you have previously provided to us or that
you may subsequently provide to us. This consent is regardless of whether the number we use to contact you
is assigned to a landline, a paging service, a cellular wireless service, or any other service for which you may
be charged for the call. You further authorize us to contact you through the use of voice and voice mail,
including the use of pre-recorded or artificial voice messages and an automated dialing device.
“If necessary, you may need to update the telephone numbers or email addresses listed in our records in
order to ensure we can contact you. You may update your contact information at any time by logging into your
account at www.scottrade.com.”
o This new section explains our need to contact you regarding your account(s) and your protections
under applicable laws regarding our reasons for contacting you. This section contains an
authorization from you to us for us and the specifics of how we may contact you. We also describe
your responsibility to keep your contact information current in our records.
Electronic Funds Transfer Act Disclosure (additional/replacement statements italicized)
ELECTRONIC FUND TRANSFERS YOUR RIGHTS AND RESPONSIBILITIES
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7. Scottrade Bank Online Banking Transfers - Types of Transfers
• Removed mention of an overdraft line of credit as an account-option you could obtain information for on our
website.
o This account type is no longer offered.
11. PREAUTHORIZED PAYMENTS
• We have changed the contact for questions in relation to placing stop payments for preauthorized payments
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from your local Scottrade brokerage branch office to Scottrade Bank Support at 855.265.2265.
o This change allows you to reach Scottrade Bank® subject matter experts more quickly.
Truth-In-Savings Disclosure
5. Certificate Of Deposit
• In the “Early withdrawal penalties” section we removed all but one early withdrawal penalty imposed for
making a withdrawal from a CD prior to maturity. The remaining early CD withdrawal penalty is required by
law and affects CD withdrawals made within the first six days after the deposit you make to open the CD. This
penalty has not changed from the previous version of this disclosure.
o This change reflects our new practice of not charging an early CD withdrawal penalty unless required
by law.
• In the “Renewal policy” section we removed all language indicating CD renewals. Scottrade Bank has made
the decision to no longer offer new CDs and no longer renew CDs. The section now states “This account will
not renew automatically at maturity. Upon the maturity date, your deposit will be placed in either a
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corresponding interest-bearing or a noninterest-bearing Scottrade Bank account or an affiliated non-IRA
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Scottrade Brokerage account you own. If we are unable to place the funds in a Scottrade Bank or an
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affiliated non-IRA Scottrade brokerage account you own, we may mail the funds in the form of a check to the
address of record.”
o Effective with this version of our agreement on or after April 27, 2017, Scottrade Bank will no longer
open new CDs or renew existing CDs upon maturity. The change describes the new process of final
maturity to be experienced by existing CD account holders.
• In the “Grace period” section we removed reference to a ten calendar-day window for removing funds from a
maturing CD without a penalty and replaced it with “Your certificate will not renew. The funds will be
withdrawn as described within the Renewal policy above.”
o The grace period will be replaced with an automatic placement of funds as described in the new
version of the “Renewal policy” section.
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