New American National Standard Removes Barrier to eSecuritization of Electronic Contracts in Financial Services Industry

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eOriginal spearheaded ANSI X 9 initiative to standardize methodologies for legally compliant transfer of electronic contracts.

A critical step was completed in simplifying electronic finance documentation processes and facilitating their securitization with the approval by the Accredited Standards Committee X9 (ASC X9) and the American National Standards Institute (ANSI) of ANSI X9.110-TOLEC (Transfer of Location of Electronic Contracts). The new American National Standard provides a legally compliant methodology to securely move original electronic finance documents, including electronic chattel paper for securitization in the secondary market, from one location to another. Companies which follow the process of the standard can execute such transfers between entities without violating the requirements of current laws for the discernable existence of only one original or "authoritative copy" of the finance documents.

The development of the new ANSI X9.110-TOLEC standard began when eOriginal, as an X9 member, submitted a new standard work project to initiate the 18 month drafting effort. Bryan Caporlette, Chief Technology Officer and Chief Operating Officer of eOriginal, was the Convenor and leader of the Working Group under ASC X9 which prepared the new standard. Mr. Caporlette explained that "TOLEC fills a gap in the management of the complete lifecycle of electronic vehicle retail sales agreements known as eContracts, by providing industry consensus on a uniform process to transfer eContracts from one location to another for the purposes of aggregating, managing, pooling and securitizing these negotiable instruments".

Vehicle finance portals, captive finance companies, banks, other finance sources and custodians accept eContracts and maintain the originals in electronic vaults in order to keep them legally compliant, admissible, and negotiable. With the X9.110-TOLEC standard, finance companies wanting to pool and securitize electronic contracts maintained in different locations need no longer be concerned about maintaining the integrity of the originals as they are moved from one location to another. Any electronic vault, using X9.110-TOLEC standard messaging, can automatically execute a series of interactions that deliver flawless vault-to-vault transfers.

The new X9.110-TOLEC standard clearly outlines the process for a "sending vault" to communicate with a "receiving vault", to automatically authenticate and validate the controller and source of authoritative copies and transfer them from one location to another. The receiving vault validates and accepts transfers of the eContracts and ancillary documents along with their audit trails. The audit trails prove ownership and track activity concerning the authoritative copies, keeping the eContracts enforceable, admissible and negotiable. All communication is encrypted and all messages and documents are digitally signed for tamper-evidence.

The ASC X9 Working Group was comprised of industry business experts, the legal community, regulatory agencies, industry service providers, finance and credit card companies and other lenders. The American Financial Services Association led the effort with ANSI and served as the standard's document editor. Copies of ANSI X9.110-TOLEC are available at

About eOriginal
eOriginal, Inc.'s advanced electronic signature and vaulting solutions enable financial services companies to eliminate paper while legally protecting their assets as they are held and transitioned throughout their lifecycle. eOriginal technology and processes create legally binding electronic signatures and Electronic Original® finance documents that are tamper-evident, auditable and enforceable. eOriginal technology provides compliance for managing electronic signatures and transferable records under E-Sign, UETA and UCC Revised Article 9-105. eOriginal technology protects nearly $15 billion in secured electronic assets, with more than $2 billion of those assets pooled and securitized, and has managed more than half a million electronic finance transactions without a single error or legal challenge. For more information, please visit or contact Pattie Newton-Pupo at 410.625.5146.


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