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1. Introduction

Welcome to Redwood Credit Union’s Remote Deposit (“Remote Deposit”). This agreement sets out the terms and conditions on which Redwood Credit Union (RCU) will provide, and you may use, Remote Deposit. Please read this agreement carefully and keep a copy for your records, as this forms a legally binding agreement between you and Redwood Credit Union. Your use of Remote Deposit Capture is also subject to the terms and conditions in your Redwood Credit Union Membership Account Disclosure, incorporated into this agreement by reference. By accepting this agreement and using Remote Deposit Capture, you agree to these terms and conditions.

A. Definitions

For the purpose of this agreement, the following definitions apply:

• “RCU” refers to Redwood Credit Union
• “You” and “your” refer to you as the account owner and user of Remote Deposit.
• “Check” or “Checks” refers to negotiable demand draft(s) drawn or payable through an office of a United States based financial institution, as well as demand draft(s) drawn on a Federal Reserve Bank or a Federal Home Loan Bank or on the Treasury of the United States. Check(s) include original check(s) and substitute check(s). Check(s) do not include noncash items payable in a medium other than United States dollars. A draft may be a check even though it is described on its face by another term, such as ‘money order.’
• “Remote Deposit” refers to the use of an image capture device to record an image of a check and deposit the check to your account.
• “Mobile Deposit” refers to the use of remote deposit through a mobile device. “Home Deposit” refers to the use of remote deposit through a desk top computer and scanner.

B. Governing Law

This Agreement will be governed by and interpreted in accordance with federal law and regulation, and to the extent that there is no applicable federal law or regulation, by the laws of the State of California. To the extent permitted by applicable law, you agree that any legal action regarding this Agreement shall be brought in the county in which RCU’s headquarters office is located.

C. Scope of Services

Upon approval, you may use RCU’s Remote Deposit Capture to deposit checks into your accounts at RCU, subject to the terms of this agreement. Checks deposited through Remote Deposit will be converted to digital images for processing. RCU reserves the right to deny your access to Remote Deposit, or any service associated with Online Banking, if you are in default of any agreement with RCU as outlined in your Membership Account Disclosure. If you wish to later cancel the Remote Deposit service contact RCU – see the How to Contact Us section at the end of this disclosure.

2. System requirements

In order to access and use Remote Deposit, you must be enrolled in RCU Online Banking and our Remote Deposit Application and meet the following hardware and software requirements

• Mobile Deposit: You must have a mobile device with Internet access and a digital camera. Please see RCU’s website for a current list of supported mobile device operating systems and camera resolution standards.
• Home Deposit (if service is available): You must have a computer with Internet access and scanner. Please see RCU’s website to determine if this service is available and a current list of supported operating systems and scanner standards.

3. Remote Deposit Process

A. Deposit Process:

To use Remote Deposit, you must log into RCU Online through one of the following methods:

• Mobile Deposit: if using a mobile device you may log into RCU Online using our Remote Banking Mobile application where you will take a digital photograph of the physical check you wish to deposit.
• Home Deposit: If RCU makes the service available, you may log into RCU Online, where you will then digitally scan the physical check you wish to deposit.

Once you have accessed Remote Deposit and created a digital image of your check, you will then upload the image to deposit it into your account. Once an image is successfully captured, you will receive an on-screen confirmation of the deposit as well an email to the email address designated on your account. If your deposit is not accepted for processing you will receive an email and an on screen notification that the check will not be processed. If your deposit is accepted but later requires an adjustment or is rejected during final processing, you will receive an email notification and your account will be adjusted within two business days.

You are required to review the information displayed and make any corrections to information that was not captured in the image upload, including entering the legal amount of the check. If there is a difference between the written amount and numerical amount, the written amount is the legal amount. For example, if a check is written for “Five Dollars” with a numeric amount of “$50.00”, the legal amount of the check is five dollars.

B. Transaction Limits:

Deposits through Remote Deposit are subject to limits, both in the total dollar amount that may be deposited and in the number of items you may deposit. Your limits are based on your recent account history and overall relationship with RCU and may change on a regular basis. The amount of your limit for a particular day will be displayed to you in Remote Deposit. Below is the range of deposit limits:

• Daily: $1,500.00 - $50,000.00
• Weekly: $2,000.00 - $50,000.00
• Monthly: $4,000.00 - $75,000.00

If your deposit exceeds your displayed limits, your deposit will not be accepted through Remote Deposit. If this occurs, you may visit any RCU branch or ATM to make your deposit. The fact that a deposit is within your available transaction limit does not mean that a deposit will necessarily be accepted or will be made immediately available. See Section 4: Deposit standards and Right to Reject and Section 5: Funds Availability for more information.

C. Check Retention:

Upon completion of your deposit, will need to retain the physical check for 14 days. You agree that you will provide the physical check to RCU if requested during the retention period. If you fail to retain the physical check for any reason during the retention period, you will be responsible for any losses that result from the lack of the physical check, which may include the full amount of the deposit and any fees that may result.

Following the end of the 14-day check retention period, you will responsible for destroying the original check. You agree to destroy and dispose of the original checks with a high degree of care, including selecting and implementing appropriate destruction and disposal procedures. You are required to implement such procedures to ensure that the original checks are not accessed by unauthorized persons during the storage, destruction and disposal process and, once destroyed, the original checks are no longer readable or capable of being reconstructed. You are responsible for any losses associated with the accidental inclusion of a physical check in the check collection process or with a lost, destroyed, stolen or misplaced check.

To protect the security of your deposits, RCU recommends that you take the following actions after depositing a check through Remote Deposit:

• Write on the back of the check “Deposited Electronically” to indicate that it has been deposited to ensure you don’t inadvertently re-deposit the item. Do not write on the front of a check.
• Keep the check in a secured area, such as a locked desk or box, until it can be destroyed.
• When destroying checks after the end of the retention period, use competent shredding equipment.

4. Deposit Standards and Right to Reject

A. Check Standards:

You agree and warrant that all checks you deposit into your RCU account will meet the following standards:

• Checks must bear an authentic signature by the person on whose account the check was drawn.
• Checks may not have any apparent alteration to the front of the check.
• Checks must be made payable to you or another owner of your account. If a check is payable to multiple parties with the designation of “and”, all payees must be account owners. For example, if a check is made payable to “Pat Smith and Sandy Smith”, both Pat and Sandy Smith must be owners of the account the check is negotiated through. If the check is instead made payable to “Pat Smith or Sandy Smith”, “Pat Smith / Sandy Smith”, or “Pat Smith Sandy Smith”, either Pat or Sandy may negotiate the check as long as one of them is an account owner.
• The payee of the check must endorse the check on the first 1½ inches of the trailing edge of the back of the check.
• Checks must be a negotiable item, payable in US dollars, drawn on a financial institution physically located in the United States, and must contain a MICR line (special characters printed on the bottom of the check that contain routing number and account number associated with the check).
• Checks may not be presented prior to the effective date of the check and may not be more than 6 months old.
• Checks may not have been previously presented for payment.
• To the best of your knowledge, checks are not fraudulent or otherwise unauthorized by the owner of the account on which the check is drawn, drawn on a closed account, or drawn on an account with insufficient funds to pay the check. You have no reason to believe the check will not be paid by the institution on which it is drawn.
• Checks may not be any of the following:
  • Contain the statement “non-negotiable”
  • Transmitted from an OFAC-restricted country
  • Registered government warrant (otherwise known as IOUs issued by State Government in lieu of actual payment)
  • Previously converted to a substitute check as defined in the Expedited Funds Availability Act or remotely created

In the event that you, or any third party, presents or attempts to present a deposit in violation of this subsection, you agree to defend, indemnify, and hold RCU and its agents employees and volunteers harmless from and against all liability, damage, and loss arising out of any claims, suits, or demands brought by third parties with respect to any such substitute check or original check.

B. Image Standards

You are responsible for inspecting and verifying the quality of check images uploaded through Remote Deposit. This is required to ensure check images are legible for all posting and clearing purposes by RCU. Specifically, you are representing and warranting to RCU that:

• The check image is an accurate representation of all information on the front and back of the original check at the time the original check was converted to an image, and the image contains all endorsements from the original check necessary to permit RCU to:
  • Acquire rights of a holder in due course in the collection process of checks and other items;
  • Handle, process, maintain and destroy original checks; and
  • Ensure that neither RCU, nor any other financial institution (depository, collecting or payor), drawee, drawer or endorser receives presentment or return of, or otherwise is charged for a Check or Image Item more than once in any form.
• The check image contains a record of all MICR line information that is required for a substitute check and otherwise satisfies all of the American National Standards Institute (ANSI) X9.37 standards for image quality required by Check 21 and Regulation CC for the creation and/or transferring of a substitute check created from that Image Item;

C. Right to Reject, Reverse or Adjust Deposits

If a check does not meet RCU’s check or image standards, RCU reserves the right to reject your deposit or, alternatively, withdraw the deposit from your account after you complete the deposit. Additionally, RCU reserves the right to adjust your deposit after you have submitted it for processing to correct mistakes in the value of the check deposited or for mistakes in encoding. A fee may be charged for deposit adjustments—see Cost Recovery Schedule.

RCU’s acceptance of a deposit through Remote Deposit does not constitute a guarantee that the deposit meets RCU’s check and image standards, is a legitimate check, or will be paid by the clearing financial institution. As account owner, you accept responsibility of all checks deposited into your account. If a check is not paid by the clearing institution, RCU will reverse the deposit from your account and you will be responsible for any losses, fees, and/or negative balances that result from such a reversal. If you are concerned that a check will not be paid, RCU encourages you to negotiate the check directly with the financial institution it is drawn upon.

5. Funds Availability and Processing Times

A. Funds Availability:

Deposits made through Remote Deposit will be made available to you in the time frames established in RCU’s Funds Availability Policy in your Membership Account Disclosure. We will tell you at the time you make a deposit through Remote Deposit when the funds will be made available to you. If RCU later delays the availability of your funds, we will notify of the revised availability date.

By making funds available to you, RCU does not warrant that a check has been paid by the institution upon which it is drawn. Checks may be rejected for payment by the clearing financial institution after the deposit was made available for your withdrawal. If a check deposit is rejected for payment, RCU will reverse the deposit from your account, please see section 4: Deposit Standards and Right to Reject in this agreement.

B. Processing times:

Deposits completed through Remote Deposit will be processed on business days. Our business days are Monday through Friday. Weekends and Federal Holidays are not included. Deposits after 6:00 PM or on a non-business day will be considered received on the following business day.

6. Authority to terminate access to MDC

You agree that RCU may immediately terminate this agreement and your use of Remote Deposit without prior notice for any reason.

7. Change of Terms

RCU reserves the right to change the terms under which Remote Deposit is offered at its sole discretion at any time; however, RCU will notify you of any material change to the terms. In most cases, you will receive the notice online the next time you log in; however, RCU reserves the right to notify you by email or by conventional mail, at its discretion. You agree that if you continue to use Remote Deposit after we notify you of any change, you thereby accept the changes to the terms and agree to be bound by this agreement, as amended. If you do not accept and agree to the changes to the terms, you will not be eligible to use Remote Deposit. You can review, download and print the most current version of this Agreement at any time through RCU Online Banking by clicking on "Documents.” If you do not agree to the changes, or if at any time you wish to discontinue your use of Remote Deposit, contact RCU directly using the “HOW TO CONTACT US” section at the end of this agreement.

8. Limitation of Liability for Failure for Remote Deposit

Remote Deposit is generally available twenty-four (24) hours a day, seven (7) days a week, although the system may be unavailable from time to time for maintenance.

If we do not complete a transaction on your account on time or in the correct amount according to our agreement with you, we will be liable for your losses or damages. Our sole responsibility for an error in a transaction will be to correct the error. You agree that RCU shall not be responsible for property damage or loss, whether caused by the equipment, software, RCU, or by Internet access providers, online service providers or by an agent or subcontractor of any of the foregoing. RCU or any service providers we use to offer Remote Deposit will not be responsible for any direct, indirect, special or consequential economic or other damages arising in any way out of the installation, download, use, or maintenance of the equipment, software, Remote Deposit, Internet browser, or access software. In states that do not allow the exclusion or limitation of such damages, our liability is limited to the extent permitted by applicable law. RCU will not be liable for the following:

• If, through no fault of ours, your account is inactive.
• If you used the wrong username and password or you have not properly followed any applicable computer or RCU user instructions for making deposits.
• If your remote device fails or malfunctions or Remote Deposit was not properly working and such problem should have been apparent when you attempted such transaction.
• If circumstances beyond your control (e.g., fire, flood, telecommunication outages or strikes, equipment or power failure) prevent making the transaction.
• If the funds in your account are subject to an administrative hold, legal process, or other claim.
• If you have not given the RCU complete, correct, and current instructions so RCU can process a transfer.

There may be other exceptions stated in either this agreement or the RCU’s Membership Account Disclosure.

RCU’s liability and your remedy for actual costs and losses resulting from our failure to process checks in accordance with the Terms and Conditions shall not exceed the direct money damages that you incur as a result of our failure. RCU will not be responsible for any loss, delay, cost or liability which arises, directly or indirectly, in whole or in part, from: (a) your actions or omissions, or those of third parties who are not within our immediate and reasonable control; (b) your negligence or breach of any agreement; (c) any ambiguity, inaccuracy, or omission in any information provided to RCU; (d) any error, failure, or delay in the transmission or delivery of data, records, or checks due to a breakdown in any computer, mobile transmission, or communications facility; (e) accidents, strikes, labor disputes, civil unrest, fire, flood, water damage (e.g. from fire suppression systems), or acts of God; (f) causes beyond our reasonable control; (g) our inability to confirm to our satisfaction the authority of any person to act on your behalf; (h) your failure to provide us with complete and correct check images and data in accordance with the Terms and Conditions and the service instructions; (i) the return of any check by the institution upon which it is drawn; (j) the unavailability of the service for any reason; (k) any information that is lost, intercepted, or destroyed during its transmission to RCU; or (l) limitations placed on transactions by the Federal Reserve, clearing houses, or exchange network rules or guidelines. Although RCU may attempt to detect errors in your instructions (e.g., you send an image to the same check twice) RCU assumes no liability for failing to do so. We will not be responsible under any circumstances or under any legal theory for special, indirect, or consequential damages, including (without limitation) any loss of profits, opportunity, or goodwill that you incur as a result of your actions or omissions, even if RCU is aware of the possibility for such damages.

9. Indemnity

You agree to indemnify, defend, and hold us harmless (by Counsel of our choosing) from and against any and all claims, actions, damages, liabilities, costs, and expenses, including reasonable attorneys' fees and expenses, arising out of your use of Remote Deposit, any negligent or intentional action or inaction, and/or any breach of this Agreement. The parties agree that this paragraph shall survive the termination of this agreement

10. Miscellaneous

You agree that our rights and remedies arising out of any breach of your representations and warranties in this agreement, the limitations on our liability and our rights to indemnification under this Agreement are continuing and shall survive the termination of this agreement, notwithstanding the lack of any specific reference to such survivability in these provisions. RCU’s failure to enforce the strict performance of any provision of this agreement will not constitute a waiver of RCU’s right to subsequently enforce such provision or any other provisions of this agreement.

If either you or RCU has any dispute or disagreement with the other party regarding this agreement that cannot be resolved amicably, both parties agree that the sole and exclusive remedy shall be binding arbitration in accordance with the then-current rules and procedures of the American Arbitration Association. This agreement shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its conflict of laws provisions or your actual state or country of residence. If for any reason a court of competent jurisdiction finds any provision or portion of the terms to be unenforceable, the remainder of the terms will continue in full force and effect.

As a condition of using Remote Deposit, you warrant to us that you will not use Remote Deposit for any purpose that is unlawful or is not permitted, expressly or implicitly, by the terms of this agreement or by any applicable law or regulation.

11. Electronic Funds Transfer Agreement and Disclosure – Personal Accounts Only

Electronic Funds Transfers (EFTs) are payments to, or withdrawals from, your accounts that are started electronically. This EFT Agreement applies to all EFT transactions you initiate through Remote Deposit.

All EFTs are subject to the terms governing RCU accounts you access electronically. By applying for, retaining and using Remote Deposit you consent to the terms of this agreement and disclosure with regard to your use of EFT services.

This Agreement and Disclosure does not apply to wire transfers, and certain provisions do not apply to business and other non-personal accounts.

BUSINESS AND OTHER NON-PERSONAL ACCOUNTS

EFTs on business Accounts are not subject to the Electronic Funds Transfer Act or its implementing regulation, Federal Reserve Regulation E. You are responsible for all electronic access to your business accounts, including unauthorized electronic access. Please monitor your accounts closely and immediately report to us any unauthorized or suspicious activity. See the section titled “Your Liability for Unauthorized Use – Business Accounts and other Non-Personal Accounts Only” in this agreement as well as your Membership Account Disclosure for more information.

Unauthorized Transactions - Personal Accounts Only

Your Liability for Unauthorized Use

Tell us AT ONCE if you believe that your RCU Online username or password has been lost, stolen or otherwise made available to an unauthorized person, or that someone has transferred or may transfer money from your account without your permission. Please refer to the “HOW TO CONTACT US” section at the end of this disclosure for how to notify us. Telephoning is the best way to keep losses down. You could lose all the money in your account, plus your maximum overdraft line of credit if you fail to promptly report unauthorized RCU Online use.

If you believe your RCU Online username or password has been lost or stolen or otherwise made available to an unauthorized person, and you tell us within two (2) business days after you learn of the loss or theft, you will have no liability for unauthorized transactions.

However, if you DO NOT tell us within two (2) business days after you learn of the loss or the theft of your RCU Online username or password, and we can prove we could have stopped someone from using password without your permission, you could lose as much as $500.

Also, if your statement shows transfers that you did not make, tell us at once. If you do not tell us within sixty (60) days after the statement was mailed to you, you may not get back any money you lost after sixty (60) days, if we can prove that we could have stopped someone from taking the money if you had told us in time. That means you could lose all the money in your account plus your maximum overdraft line of credit.

If a good reason (such as a long trip or a hospital stay) kept you from telling us, we may extend the time periods.

RCU’s Liability

If we do not properly complete an EFT transaction according to our agreement with you, we will be liable for your direct losses or damages. However, there are some exceptions.

RCU will not be liable in the following situations:

• If, through no fault of ours, your account does not contain enough money, or you don’t have available credit, to make the transaction;
• If the equipment was not working properly and you knew about the breakdown when you started the transaction;
• If the money in your account is subject to legal process or other claim;
• If circumstances beyond our control such as fire, flood, electrical failure, or malfunction of the central data processing facility prevent the completion of the transaction despite our reasonable precautions; or there are other lawful exceptions established by RCU and you are given proper advance notice of them.

In no event will RCU be liable for consequential, indirect or exemplary costs or damages. Our liability is limited to the amount of the transaction.

RCU will carry out instructions given to us electronically, including transactions initiated through RCU Online. We will not incur liability for doing so in a reasonable manner. You agree to indemnify and save RCU harmless from all costs, claims, damage, or liability that we sustain as a result of carrying out in a reasonable manner instructions received from you or any authorized user through RCU Online or any other EFT service that is now available or becomes available in the future.

In Case Of Errors or Questions About Your Electronic Transfers - Personal Accounts Only

If you believe an electronic transfer shown on your statement is wrong, or if you need more information about a transfer, contact us at the telephone number or address listed under the “HOW TO CONTACT US” section at the end of this disclosure. Please tell us all the information requested under the section entitled “WHAT TO TELL US IN CASE OF ANY ERROR OR INQUIRY” at the end of this disclosure.

We must hear from you no later than sixty (60) days after we sent you the FIRST statement on which the error or problem appeared. If you tell us orally, we may require that you send us your complaint or question in writing within ten (10) business days. We will tell you the results of our investigation within ten (10) business days (twenty [20] business days for new accounts) after we hear from you and will correct any error promptly.

If we need more time, however, we may take up to forty-five (45) days (ninety [90] business days for transactions involving foreign countries or new accounts) to investigate your complaint or question. If we decide to do this, we will re-credit your account within ten (10) business days (twenty [20] business days for new accounts) for the amount you think is in error, so that you will have use of the money during the time it takes us to complete our investigation. A “new account” is one open thirty (30) days or less.

If we ask you to put your complaint or question in writing and we do not receive it within ten (10) business days, we may not re-credit your account.

We will send you a written explanation of the results of our investigation within three (3) business days after we finish our investigation. You may ask for copies of the documents that we used in our investigation. If we decide to reverse a provisional credit, we will notify you, and will pay any items that overdraw your account for five (5) business days after we send you this notice without imposing an overdraft fee, but only to the extent the overdrafts are equal to or less than the amount of the provisional credit we deducted from your account. If any item overdraws your account by more than the amount of the provisional credit, you will be charged an overdraft fee. You agree to immediately restore to RCU the amount of any overdraft on your accounts.

What to Tell Us in Case of Any Error or Inquiry:

• Your name;
• Your Member (account) number;
• Describe the error or the transfer about which you are unsure;
• Explain, as clearly as you can, why you believe there is an error;
• The dollar amount;
• The date on which the transfer in question occurred;
• Your daytime telephone number

12. Miscellaneous:

You understand and agree that you are responsible, to the extent permitted by law, for all warranties and indemnifications set forth in Check 21 applying to any Reconverting Credit Union and Truncating Credit Union, as such terms are defined by Check 21, including, without limitation, the obligation to only convert an original check that allows for the creation of a substitute check that clearly and accurately represents the information on the front and back of the original check. RCU and its agents may, but shall have no obligation, to screen items or substitute checks for legal compliance.

You agree to comply with all applicable laws, rules and regulations in relation with Remote Deposit. RCU makes no representation that content or use of Remote Deposit is available for use in locations outside the United States. Accessing from locations outside of the United States is at your own risk.

You agree not to use the Remote Deposit or the content or information delivered through the Remote Deposit any way that would (a) infringe any third party copyright, patent, trademark, trade secret or other proprietary rights or rights of publicity or privacy; (b) be fraudulent or involve gambling, involve the sale of counterfeit or stolen items or use Remote Deposit to impersonate another person or entity; (c) violate any law, statute, ordinance or regulation; (d) be false, misleading or inaccurate; (e) create liability for RCU or its affiliates or cause RCU to lose (in whole or in part) the services of any third party providers; (f) be defamatory, trade libelous, threatening or harassing (g) may potentially be perceived as obscene or pornographic or contain child pornography or racially, ethnically or otherwise objectionable; (h) interfere with or disrupt computer networks or infect the computer networks with viruses; (i) interfere with or disrupt the use of Remote Deposit by any other party; (j) use Remote Deposit in any manner to gain unauthorized entry or access into the RCU’s computer systems; or (k) resell or make any commercial use of the Remote Deposit.

REMOTE DEPOSIT AND RELATED DOCUMENTATION ARE PROVIDED "AS IS," “AS AVAILABLE” WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE. NOTWITHSTANDING RCU’S EFFORTS TO ENSURE THAT THE SERVICE IS SECURE, RCU CANNOT AND DOES NOT WARRANT THAT ALL DATA TRANSFERS WILL BE FREE FROM MONITORING OR ACCESS BY OTHERS. YOU ARE SOLELY RESPONSIBLE FOR THE MAINTENANCE, INSTALLATIONS, AND OPERATION OF YOUR COMPUTER AND MOBILE DEVICE(S). NEITHER RCU NOR ITS SERVICE PROVIDERS SHALL NOT BE RESPONSIBLE FOR ANY DELAYS, ERRORS, DELETIONS, OR FAILURES THAT OCCUR AS A RESULT OF ANY MALFUNCTION OF YOUR COMPUTER OR SOFTWARE.

13. How to Contact Us:

You may contact RCU as follows:

• Secure Email: In Online Banking, click on the “Messages” option
• General Email: www.redwoodcu.org - click on “Contact Us”
• Phone: Local - (707) 545-4000 or Toll-Free - 1 (800) 479-7928
• Mail: Redwood Credit Union, PO Box 6104, Santa Rosa, CA 95406-0104

4/26/2013   KB2764  Form # RD - 2205