670	 Some Legal Implications of the Use of Computers in the Banking Business	 The introduction of computers in to the banking business has a wide variety of legal implications that merit careful attention at this very early stage. The industry is highly regulated by government and hence is subject to many statutes and regulations. It also is affected by important common law rules established by courts. The legal ramifications involve not only the mechanization itself but also the very significant economically attractive phenomenon of off premises processing. It is essential to identify and provide for many legal aspects right now before systems and practices crystallize in order to avoid the later impact of unanticipated physical complications and expense. The legal aspects of computerization in the banking business are especially diverse. In some states there might be the basic question whether banks are authorized by law to invest in the new facilities either directly or through cooperatives. More challenging are questions relating to off-premises processors particularly with respect to the obligation not to disclose information concerning a bank s customers the adequacy of fidelity bond coverage the extent of liability for improper refusal to pay a check and susceptibility to regulation by government agencies. Also pertinent is the propriety of data processing by banks for nonbank entities and particularly of the rendering of that service without charge for bank depositors.
