Required Disclosures, Notifications & Error Resolution

Please include the following disclosures & notifications within your application. Synapse will periodically audit your platform to ensure continued compliance. These requirements may be updated upon providing notice to you. Requirements are broken down into three sections:

I. Agreements & Disclosures

II. Transaction & Account Notifications

III. Error Resolution 

I. Agreements & Disclosures:

(1) Requirements for Creating a User:
Please include the following requirements for users creating the following account types. 

Additionally, please notify your users & include a checkbox of acknowledgement when updates are made to the Terms of Service.

Account Type #1: Deposit Accounts (DEPOSIT-US or SYNAPSE-US nodes):

 Include a checkbox and the following verbiage upon creating a user with a deposit account:

“The bank services are provided by <Insert Bank Name>, Member FDIC. By opening up a deposit account on <Insert Platform Name>, you agree to <Insert Bank Name> Deposit Agreement and SynapseFI’s Terms of Service and Privacy Policy."

The following words shall be hyperlinks:

Include the following footer for all pages that include references to transactions or funds held in a User’s Deposit Account or bank services in the Deposit Agreement.

“Banking services are provided by <Insert Bank Name>, Member FDIC.”

Account Type #2: Sub-Accounts held within Platform's FBO Account*:

Include a checkbox and the following verbiage upon creating a user with a sub-account:

"By using our services, you agree to SynapseFI’s Terms of Service and Privacy Policy."

The following words shall be hyperlinks:

*Note regarding FBO accounts: Platform’s FBO account is a Deposit Account with Bank and is subject to the Deposit Account Agreement found at https://synapsefi.com/evolve-bank-deposit-agreement.

The Sub-Accounts of an FBO account may be eligible to receive “pass-through” FDIC insurance coverage, if Platform meets all of the applicable FDIC rules including, but not limited to 12 CFR 330.5 and 12 CFR 330.7(a)Platform should consult with legal counsel prior to telling users Sub-Accounts are FDIC insured. When determining whether a Sub-Account is eligible for “pass-through” the FDIC generally reviews the following:

(a) Fund Ownership:  Funds must be in fact owned by the principal (i.e. Users) and not by the third party who set up the account (i.e., <Insert Platform Name>, as the fiduciary or custodian who is placing the funds). To confirm the actual ownership of the deposit funds, the FDIC may review:

  • The agreement between the third party establishing the account and the principal; and
  • The applicable state law.

(b) Account Titled as FBO:  The Bank’s account records must indicate the agency nature of the account (e.g., <Insert Platform Name> as Custodian, <Insert Platform Name> for the benefit of (FBO), <Users>.

(c) Sub-Account Records:  The records of the Bank, the <Insert Platform Name>, as the fiduciary, or a third party must indicate both the identities of the principals (i.e. Users) as well as the ownership interest in the deposit.

Platform may meet the test for “pass-through” coverage as follows:

(a) Fund Ownership:  Include in your agreement with Users the following text:

“By using our services, you authorize <Insert Platform Name> to hold your deposits for your benefit at <Insert Bank Name>, Member FDIC, in an account (“FBO Account”). For purposes of applicable FDIC deposit insurance limitations, please note that deposits in <Insert Bank Name> FBO Account may not be separately insured from any other deposit accounts you may have with <Insert Bank Name>.

(b) Account Titled as FBO: Platform must ensure all User deposits are directed to its Deposit Account with Bank which is titled as an FBO account.

(c) Sub-Account Records:  Transactions created from Users must be sent to User’s SUBACCOUNT-US node in order to manage the ledger of each User.

For more information, please review the FDIC’s rules and regulations and the following guides on fiduciary accounts + pass-through FDIC coverage.

Account Type #3: No Deposit or Sub-Accounts

Include a checkbox and the following verbiage upon creating the user.

"By using our services, you agree to SynapseFI’s Terms of Service and Privacy Policy."

The following words shall be hyperlinks:

(2) Requirements for ACH Authorization for Transactions:

If you are debiting User accounts via ACH (i.e. a User’s ACH-US node), include a checkbox and the following ACH authorization verbiage:

Single Transaction Authorization

"I authorize <Insert Platform Name> to debit the account indicated for the amount noted on today’s date. I will not dispute <Insert Platform Name> debiting my account, so long as the transaction corresponds to the terms in this online form and my agreement with <Insert Platform Name>."

Recurring Transaction Authorization

"I authorize <Insert Platform Name> to debit the account indicated for the recurring transactions according to the online form and my agreement with <Insert Platform Name>. I will not dispute <Insert Platform Name> so long as the transactions correspond to such terms. This payment authorization is valid and will remain effective unless I cancel this authorization by emailing <Insert Platform Name> at <Insert Platform Email> at least 3 business days in advance." 

(3) Requirements for Contact Page:

Include our contact information on your customer support page.

"Bank services are provided by <Insert Bank Name>, Member FDIC, through our banking software provider, SynapseFI. To report a complaint relating to the bank services, email help@synapsefi.com."

(4) Requirements for W-9 Certification

If collecting SSN or TIN, please include our W-9 Certification Language (view W-9 Certification language).

 

II. Transaction & Account Notifications:

 Please include the following transaction and notifications.

(1) Confirmation Screen and Receipts: Enable your Users to view and print a transaction receipt immediately after creating a transaction form that contains:

  • Full details of the scheduled transaction(s) (i.e. payment amount and date, and, if recurring transactions:, the frequency of transactions, start date, end date or number of transactions and disclosure);
  • A transaction number for any transaction processed as part of the scheduled payment(s) when it was entered;
  • Contact information for your support and SynapseFI (help@synapsefi.com); and
  • Information on how to cancel transaction (ex: “Click here to cancel transaction.”)

If recurring transaction, include the following text:

To cancel this transaction, Click Here. This is an authorized recurring debit from your account if you would like to cancel future payments, please email us at <Platform email address> with at least 3 business days notice.”

(2) Email Notifications and Receipts:  At the following times, email transaction receipt (as detailed above) to Users and keep copies of the emails for 2 years after the transaction was settled:

  • After each transaction is created;
  • Before a new transactions is created if part of recurring transactions; and
  • After funds have settled into a User Deposit Account (if applicable) with information on how to access those funds on your application

(3) Changes to Scheduled Transactions:  Email Users in advance of any changes to a scheduled transaction amount, frequency or timing.

(4) Statements:  Email Users monthly statements with their transaction history and, if applicable, balances held in the User’s Deposit Account (ending and beginning balances).

 (5) Bank Login MFA:  In the event that a User’s ACH account does not support multi-factor authentication (“MFA”) for Bank Logins, Synapse may initiate an white labeled MFA email or text to the User on behalf of Platform.

 

III. Error Resolution

Platform will include the following language in its agreement with Users for resolving errors relating to transactions for Users not opening Deposit Accounts.

(1) Errors or Questions about Transactions

Please contact us by emailing us at <Insert Platform Email> (1) if you believe a transaction receipt or a statement is wrong, or (2) if you need more information about a transaction on the receipt or statement. For consumer accounts, 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. For business accounts, we must hear from you within one (1) business day of us sending you a receipt. Your inquiry must include: (x) your name, email associated with your account, and your account number (if available); (y) a description of the error or the transaction you are unsure about, and a clear explanation of why you believe there is an error or why you need more information; and (z) the dollar amount of the suspected error. If you tell us orally, we may require that you send us your inquiry via email within ten (10) business days.

(2) Time Periods

Ten-Day Time Period - <Insert Platform Name> will investigate promptly and, except as otherwise provided in this paragraph, shall determine whether an error occurred within 10 business days of receiving a notice of error. <Insert Platform Name> shall report the results to the consumer in writing within three business days after completing its investigation. <Insert Platform Name> shall correct the error within one business day after determining that an error occurred.

Forty Five-Day Time Period
If <Insert Platform Name> is unable to complete its investigation within 10 business days, <Insert Platform Name> may take up to 45 days from receipt of a notice of error to investigate and determine whether an error occurred, provided <Insert Platform Name> does the following:

(1) Provisionally credits the consumer's account in the amount of the alleged error (including interest where applicable) within 10 business days of receiving the error notice. <Insert Platform Name> need not provisionally credit the consumer's account if:

  • <Insert Platform Name> does not receive written confirmation within 10 business days of an oral notice of error; or
  • The alleged error involves an account that is subject to Regulation T (Securities Credit by Brokers and Dealers, 12 CFR part 220)

(2)Informs the consumer, within two business days after the provisional crediting, of the amount and date of the provisional crediting and gives the consumer full use of the funds during the investigation;
(3) Corrects the error, if any, within one business day after determining that an error occurred; and
(4) Reports the results to the consumer within three business days after completing its investigation (including, if applicable, notice that a provisional credit has been made final).

(3) Extension of time periods. The time periods described above may be extended as follows:

  • Extension of Ten-Day Time Period - The time limit for resolution is extended to 20 business days in place of 10 business days if the notice of error involves an electronic fund transfer to or from the account within 30 days after the first deposit to the account was made; or
  • Extension of Forty Five-Day Time Period - The time limit for resolution is extended to 90 days in place of 45 days for completing an investigation, if a notice of error involves an electronic fund transfer that occurred within 30 days after the first deposit to the account was made.

 

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