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Electronic Document Signing in the News: 3 Ways Paper Signatures Increase Your Risk

By: Steve Stormoen / Tuesday, May 27, 2014

The personal handwritten signature, an ancient symbol of uniqueness, authenticity, and trust, has come under scrutiny as modern technology has progressed beyond pen and paper. The venerable BBC News Magazine recently explored the history and future of signatures, raising questions about the best ways to verify identity and intent in the era of computing devices. The BBC reveals:
Song of Ur, photo by UnknownRama (RamaOwn work) [CC-BY-SA-2.0-fr (http://creativecommons.org/licenses/by-sa/2.0/fr/deed.en)], via Wikimedia CommonsSignatures go back a long way in human culture. A Sumerian clay tablet from around 3100 BC is marked with the name of the scribe Gar Ama. The Romans used signatures as far back as the reign of Valentinian III in 439. El Cid left one in 1069, but it wasn't until parliament passed the Statute of Frauds in England in 1677 - which required that contracts be signed - that the signature became the commonly-understood acclamation of assent.”
While clay tablets have long gone out of style, their successors, pen-and-paper agreements, have serious limitations and are quickly becoming obsolete. Paper contracts, which have been the norm for over 300 years, have serious limitations – not just in terms of speed and convenience, but security as well. There are real dangers to relying on pen-and-paper signatures in the modern world. For everything from a multi-million dollar stock transfer agreement to a simple point-of-sale purchase at your local Target store, the vulnerabilities of paper signatures are becoming harder to ignore.

Of course, human beings are adept at developing innovations to conquer the challenges at hand, and now there’s a new way to do business. With RightSignature, parties can electronically sign documents with the safety and convenience of modern online software – without sacrificing the time-tested human element: the uniqueness and trust of a handwritten signature.

Electronic signatures have now crossed the chasm from early adopters to mainstream adoption. If you’re still using paper contracts, you need to know these three reasons why sticking with paper is becoming increasingly dangerous:

1. Electronic document signing includes identity control to protect against forgeries


When you get your paper documents signed, how often do you check the signer’s ID? Even important documents, like non-disclosure agreements or liability waivers, are often executed without a simple ID check, and to ask for one would be uncomfortable, even rude. If you let your clients and customers electronically sign your documents, however, a robust two-factor identity control system is already built in.

RightSignature electronic document signing includes email verification for signers to ensure that the person signing your document is who they say they are. Every signed document is then supported by a complete document audit and ID log for full accountability. Second, every hand-drawn signature captured with RightSignature’s electronic signature software is subject to a state-of-the-art biometric algorithm, which captures unique factors in the signer’s handwriting to establish an ironclad and court-admissible signature on all your documents.

2. Paper signatures are too difficult to verify in the most common cases of fraud

The BBC cites a Business Insider study, which found that more than 51% of all credit card fraud in the entire world comes from the United States. This is because cards in the US rely on an antiquated signature system for point-of-sale purchases, instead of the more modern EMV microchip system utilized by the rest of the world. This vulnerability is the reason recent high-profile card theft scandals at retailers like Target have hit so hard.

Theoretically, the cashier at your local retailer should compare the signature on your receipt against the signature on the back of your credit or debit card to determine whether or not that purchase is fraudulent. However, weighed against the demand that a checkout line moves quickly, this check almost never happens.

Photo by Marlith (Own work) [CC-BY-SA-3.0 (http://creativecommons.org/licenses/by-sa/3.0) or GFDL (http://www.gnu.org/copyleft/fdl.html)], via Wikimedia Commons

If your paper signature can’t be trusted in the checkout aisle of your local big box store, why would you rely on them for your own paperwork? Accountants, investors, HR managers, and law practices are among the dozens of fields taking advantage of RightSignature electronic document signing. Their conclusion: Electronic signatures are a safer and more efficient alternative.

3. Electronically signed documents are protected against alteration and destruction

An underreported source of legal vulnerability with paper documents is the ease with which these documents can be altered or destroyed after the fact. As evidenced in the $100 Million Paper Signature Blunder, any discrepancy between two different versions of the same document can add up to some extremely expensive consequences. Luckily, this potential risk is completely avoided with RightSignature.

As soon as you send a document with RightSignature, the document is locked and protected against changes, so you can be assured that there are no discrepancies between the document you send and the document your customer or client electronically signs. Likewise, once document is electronically signed, it cannot be edited or deleted, for complete protection for both you and your signer.

Electronic Document Signing for your Business

The signature is an important and ancient symbol of authenticity and personal trust. While traditional pen and paper agreements leave your business vulnerable, the cultural weight handwritten signatures, built up over centuries, remains as strong as ever. The signature is evolving with the technology of the day. Implement RightSignature electronic signatures, and your business receives the best of both worlds: the trust and strength of the signature, and the ease and speed of online software.

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