Mobile Deposit
Introduction
Mobile Deposit is a service that provides the Customer with the option of making deposits
into an Eligible Account through a remote deposit capture service.
As part of Citizens National Bank’s remote deposit capture service, checks may be
processed as a Check Image or Substitute Check (each as defined below). Through Mobile
Deposit, the Customer captures and converts checks into Check Images and then transmits
the Check Images to the Bank for processing and collection. The Bank will collect those
Check Images through the check collection system by presenting or exchanging Check
Images or using Check Images to create Substitute Checks for collection.
Definitions
“Check Image” means an electronic image of an original paper check or an electronic
image of a Substitute Check that is created by the Customer, the Bank, or another bank or
depository institution in the check collection system.
“Check Image Metadata” means information about the Check Image, as well as pointers to
the actual image data (also known as image tags).
“Customer System” means the computer hardware, mobile device, software, and webbased applications used by the Customer to prepare Electronic Deposits and to access the
Mobile Deposit remote deposit capture service.
“Electronic Deposit” means electronic information (including Check Images, Check Image
Metadata, MICR Data, or dollar amount information), obtained from capturing information
from an original paper check, that is transmitted to the Bank for deposit, processing and
collection.
“MICR Data” means information from the Magnetic Ink Character Recognition stylized
printing on the bottom of checks comprising of routing, transit, account and check serial
numbers.
“Remote Deposit Capture System” means Citizens National Bank’s computer systems and
databases that the Customer may access in order to use Mobile Deposit.
“Substitute Check” means a paper check document that meets the definition of a
“substitute check” in the Check Collection for the 21st Century Act as implemented by
Regulation CC of the Federal Reserve Board.
The Customer’s Responsibility
With respect to each Check Image or Electronic Deposit that the Customer transmits to the
Bank, the Customer indemnifies and holds the Bank and other Service Providers, and each
of the Bank’s and their respective officers, directors, employees and agents harmless from
and against any and all claims, demands, damages, losses, liabilities, penalties and expenses
(including, without limitation, reasonable attorney fees and court costs at trial or on
appeal) arising directly or indirectly:
•
•
•
•
•
From the Customer’s breach of a representation or warranty,
As a result of any of the Customer’s acts or omissions in the capturing, creation or
transmission of the Check Image or Electronic Deposit, including without limitation
the encoding of the MICR Data from the original paper check;
From any duplicate, fraudulent or unauthorized check, Check Image or Substitute
Check;
For any loss caused by the Bank’s acceptance or creation of a Check Image or
Substitute Check instead of presentment of the original paper check; or
From any other act or omission arising out of the Bank’s action or inaction taken
pursuant to any request by the Customer or pursuant to this Agreement.
Security Procedures – The Customer must comply with all security procedures for Mobile
Deposit that are established by the Bank or set forth in any written user requirements
communicated to the Customer. The Customer is solely responsible for:
•
•
•
Maintaining the Customer’s own internal security procedures,
Safeguarding the security and confidentiality of any information obtained from the
Customer’s deposited checks, Check Images and other information that is either
printed from, stored on, or downloaded to, the Customer System, Remote Deposit
Capture System, or the Customer’s other computer/data systems or portable media;
and
Preventing errors or unauthorized access to the Customer’s System or the Remote
Deposit Capture System.
The Bank Responsibility
The Bank is not liable to the Customer for failure to process an Electronic Deposit, or any
error that results in processing or collecting an Electronic Deposit:
•
•
•
For which the Customer has not provided the Bank with full and correct MICR Data
and dollar amount from the original paper check;
For which the Customer has not provided an accurate and legible image of the
original paper check,
For which the Customer has failed to comply with formatting standards or other
guidelines required by the Bank; or
•
That would violate this Agreement or any other agreement between the Customer
and the Bank.
Availability – The Bank will use reasonable efforts to provide remote deposit capture
services in a prompt fashion, but the Bank are not liable for temporary failure to provide
Mobile Deposit remote deposit capture services in a timely manner. In such event, the
Customer is responsible for carrying out banking business through alternative channels.
The Bank is not liable for any inaccurate or incomplete information with respect to
transactions which have not been completely processed or posted to the Bank deposit or
payments system prior to being made available pursuant to the Mobile Deposit Remote
Deposit Capture System. Information with respect to all transactions is provided solely for
the Customer’s convenience, and the Customer has no recourse to the Bank as to use of
such information.
Accuracy – The Customer acknowledges that the Bank does not verify the accuracy,
legibility or quality of the Check Image or MICR Data prior to processing an Electronic
Deposit. The Bank may, in the Bank’s sole discretion, reject, repair, alter, amend, re-format
or convert the Check Image Metadata or MICR Data submitted in an Electronic Deposit in
accordance with general check collection practices and industry presentment standards,
but the Bank has no obligations to reject, repair, alter, amend, re-format or convert the
Check Image Metadata or MICR Data. If the Bank requires that the Customer comply with
certain formatting standards or other guidelines when submitting Electronic Deposits and
the Customer decline to implement, or comply with, such standards or guidelines, the
Customer acknowledges that the Bank is not liable for any error or loss that results from
the Bank processing of such Electronic Deposit or from the Bank re-formatting or
conversion of the Electronic Deposit prior to processing.
Determination of Items Eligible for Mobile Deposit
All payees on the deposited item must be an owner on the account which it is deposited
into. Only a draft, payable on demand, and drawn on or payable through or at an office of a
bank, is eligible for deposit as a Check Image. Without limiting the preceding sentence, the
following items are not eligible for deposit as Check Images under Mobile Deposit, and the
Customer must deposit these original paper checks with the Bank for collection:
•
•
•
•
•
•
•
•
•
U.S. Treasury Checks,
Checks, including travelers checks, that are drawn on banks located outside of the
United States,
Checks payable in a medium other than U.S. dollars,
Non-cash items (as defined under Section 229.2(u) of Federal Reserve’s Regulation
CC),
Promissory notes and similar obligations, such as savings bonds,
Third party checks,
Pre-existing substitute checks,
Stale-dated checks over 180 days old
Post-dated checks
•
•
Checks drawn on the same Citizens National Bank account number; and
Any other class of checks or drafts as identified by Citizens National Bank to the
Customer from time to time.
The Bank reserves the right to reject any deposit (as an Electronic Deposit or otherwise)
for any reason, including but not limited to, rejection of a Substitute Check that was created
by another financial institution, the Customer or any other person.
Creating an Electronic Deposit
Endorsement – The Customer must physically endorse each paper check and ensure that
all other necessary endorsements are obtained prior to capturing Check Images for
transmission to Citizens National Bank. The Customer must endorse the back of the check
with their signature and the words “For CNB Mobile Deposit Only”.
Accuracy – The Customer is responsible for accurately capturing an image of each paper
check and the correct dollar amount of the check into the Customer System. In the event
the condition of a paper check precludes a complete automated read, the Customer is
responsible for visually inspecting the check.
Check Information – The bottom of the Customer’s check contains numeric information
that identifies the bank the check is drawn on, the account number and the check number.
This information is known as the MICR line (Magnetic Ink Character Recognition). A MICR
defect, such as a tear in the MICR line, or markings over the MICR line may inhibit the
Customer System’s ability to read this information. If the Customer receives error messages
indicating that the Customer System is unable to read the MICR line, the check with defects
in the MICR line must be physically deposited at the Customer’s local bank branch or ATM.
Legibility – The Customer is responsible for the inspection of all Check Images to ensure
the legibility of the Check Image (including without limitation the dollar amount and
signature of the person who signed the check (the “drawer”), and for ensuring that any and
all information on a paper check is accurately captured and legible in the resulting Check
Image and otherwise complies with any Check Image quality standards and guidelines that
may be established by ANSI, ECCHO Rules, the Federal Reserve, other applicable regulatory
agency or clearinghouse, or that the Bank may provide to the Customer from time to time.
Illegible Images – If any information is not accurately captured and legible, cancel the
scan/photograph and rescan/re-photograph the physical check. Any physical check that
remains inaccurate or illegible after repeated scanning/photographing attempts must be
physically deposited at the Customer’s local branch.
Security Features – The Customer acknowledges that current image technology may not
capture all security features (e.g., watermarks) contained in the original paper checks, and
the Customer must manually examine checks prior to transmission to the Bank to verify
their authenticity. The Customer agrees to assume any and all losses resulting from claims
based on security features that do not survive the image process.
Uploading an Electronic Deposit
Timeliness – The Customer must upload the Electronic Deposit transmission to the Bank
prior to the daily cut-off time established by the Bank from time to time for the receipt of
Electronic Deposits. Any Electronic Deposit transmission received by the Bank after the
Bank daily cut-off time shall be deemed to have been received by the Bank at the opening of
the Bank next business day. Performance of the Electronic Deposit services may be affected
by external factors such as communication networks latency. The Customer is responsible
for the transmission of the Electronic Deposit until the Remote Deposit Capture System
reports a successful acknowledgement of receipt of the transmission.
Receipt – An Electronic Deposit is received when the entire Electronic Deposit
transmission is received by the Bank. If only a portion of that Electronic Deposit
transmission is received by the Bank for any reason, including without limitation a failure
during the transmission to the Bank, the Electronic Deposit transmission is deemed to have
been not received by the Bank with respect to any Electronic Deposit contained in that
Electronic Deposit transmission (including any Check Image contained in the portion of
that Electronic Deposit transmission that was received).
If the Customer believes a check item may have been deposited more than once, the
Customer should call the Bank immediately at a number listed at the end of this
Agreement.
Collection of an Electronic Deposit
Check images are processed similarly to traditional paper checks; Mobile Deposit does not
process Check Images through ACH conversion. The Bank will determine the manner in
which the Bank will seek to collect a Check Image and the Bank reserve the right to process
a Check Image by any of the following methods:
•
•
•
Present or transfer the Check Image to the paying bank, a Federal Reserve Bank,
image share/exchange network, or other collecting bank;
Create a Substitute Check from the Check Image and collect the Substitute Check; or,
Request that the Customer provide to the Bank the original paper check from which
the Check Image was created and then collect the original paper check.
The Bank will have no liability to the Customer or any other person in the event that the
Customer’s deposited check is processed as, or converted by the Bank to, a Check Image or
Substitute Check.
Returned Items
Returns – The Customer agrees that the Bank may charge the Customer’s account for any
and all returned items, including a returned Check Image or a returned Substitute Check.
Re-presentment – In the event the Bank, at the Bank’s sole discretion, determines that the
Bank requires the original paper check for re-presentment in order to collect a returned
Check Image or Substitute Check, the Customer is responsible for providing to the Bank the
original paper check, or if the original paper check has been destroyed, for obtaining a
replacement check.
Marking, Retaining and Destroying Original Paper Checks
To mitigate the risk of potential fraud or the presentment of duplicate items, the Customer
agrees to clearly mark on the original paper check that the item has been deposited
electronically. Items should be marked after the Customer receives confirmation that the
deposit was received and accepted for processing by Citizens National Bank.
Destruction – The Customer must destroy the original paper check in accordance with this
Agreement and employ commercially reasonable methods to securely store the original
paper check until destruction. The Customer agrees to securely store all deposited checks
in a location away from daily processing activities. To help ensure that checks are not
electronically processed more than once or physically deposited at the bank after being
electronically deposited, the Customer will establish procedures to ensure that only
authorized persons have access to these checks.
Retention – Retain all checks for at least ten business days after the deposit is made in case
a check is returned and the Customer needs to collect on the check by re-depositing the
original item. The Customer agrees to destroy all deposited checks as soon as reasonably
possible thereafter and no later than 14 days after deposit has been posted to the account.
Cross-cut shredding is strongly recommended for check destruction. At the Bank’s request,
the Customer must provide the original paper check to the Bank if the original paper check
has not been destroyed by the Customer and the Bank needs the original paper check to
process a payment or resolve a dispute arising from an Electronic Deposit.
Funds Availability
“Funds Availability” refers to the Customer’s ability to use the funds that the Customer
deposited into the Customer’s account through Mobile Deposit. This funds availability
policy only applies to deposits made using Mobile Deposit. Deposits made at a branch
location or ATM remains subject to the funds availability policy outlined in the Customer’s
deposit account agreement.
If the Customer makes a deposit using Mobile Deposit before 4:00 p.m. (CST) on a Business
Day, the Bank will consider that day to be the day of the Customer’s deposit. If the
Customer makes a deposit using Mobile Deposit on or after 4:00 p.m. (CST), or on a nonBusiness Day, the Bank will consider the deposit to be made on the next available Business
Day.
The Customer’s deposit made using Mobile Deposit will generally be available on the first
Business Day after the day of deposit. In certain circumstances, and at Citizens National
Bank's discretion, the funds may not be available until the fifth Business Day after the day
of deposit. The first $200 of the Customer’s deposit, however, will be available no later than
the first Business Day after the day of deposit, and usually immediately.
The Bank is not liable for transactions the Customer initiates before the funds are available
for the Customer’s use. Until the funds are made available, the Customer may not withdraw
the funds in cash and the Bank may not use the funds to pay items that the Customer has
written or honor other withdrawals the Customer request. If the Bank pays items that the
Customer has written or honor other withdrawals before funds are available to the
Customer, the Bank may charge a fee for this.
In addition, funds may be delayed for a longer period under the following circumstances:
•
The Bank believes a check the Customer deposit will not be paid.
•
•
•
•
The Customer deposit checks totaling more than $1,500 on any one day.
The Customer re-deposits a check that has been returned unpaid.
The Customer has overdrawn the Customer’s account repeatedly in the last six
months.
There is an emergency, such as failure of computer or communications equipment.
The Bank will notify the Customer if the Bank delays the Customer’s ability to withdraw
funds for any of these reasons, and the Bank will tell the Customer when the funds will be
available. In general, funds delayed for the above reasons will be available no later than the
seventh Business Day after the day of the Customer’s deposit.
Please remember that even after the item has “cleared,” the Bank has made funds
available to the Customer, and the Customer has withdrawn the funds, the Customer
is still responsible for items the Customer deposits that are returned to the Bank
unpaid and for any other problems involving the Customer’s deposit.
Representations and Warranties
With respect to each Check Image or Electronic Deposit that the Customer transmits to the
Bank, the Customer is deemed to make any representation or warranty that would have
applied had the Customer deposited the original paper check. In addition the Customer is
deemed to make to the Bank any representation or warranty that the Bank makes, under
applicable law, clearinghouse rule, Federal Reserve Operating Circular, bi-lateral
agreement or otherwise, to any person (including without limitation a collecting Citizens
National Bank, a Federal Reserve Bank, a Receiving Depository Financial Institution, a
paying bank, a returning bank, the drawee, the drawer, any endorser, or any other
transferee) when the Bank transfers, presents or originates the Electronic Deposit or Check
Image, or a Substitute Check created from that Check Image. These representations and
warranties include but are not limited to, that: (a) the transmissions contain accurate
images of the front and back of the original checks; (b) the transmissions contain all
necessary endorsements up until the original checks are imaged; and (c) no depository
bank, drawee, drawer, or endorser will be asked to make a payment based on an item that
it has already paid.
Limitations of Mobile Deposit
Mobile Deposit is only available for use within the United States.
The Customer may use Mobile Deposit and the Remote Deposit Capture System for
business or personal use for as long as the Bank at the Bank’s sole discretion provides
Mobile Deposit to the Customer. As part of Mobile Deposit, the Bank reserves the right to
periodically audit the Customer’s remote deposit capture, security, and information
technology processes, and to require the Customer to implement reasonable and necessary
controls.
Once a Check Image has been accepted for deposit, the Bank is not able to delete or remove
the item from the collection process and it becomes subject to the funds availability policy
described herein.