eSign Security: How to Ensure Your Document is Legally Binding

When you electronically sign documents that have high business value, such as financial or business contracts, the possibility exists that you will someday find yourself defending the enforceability of one of those agreements in court. For example, if you sue a vendor for breach of contract, the main evidence is the eSign contract the vendor signed to perform the work. During the court proceedings, a key point is whether the document is legally binding.

The three pillars of “High Trust” with digital signatures – Security, Fraud Protection and Legal Compliance – work together to provide the highest level of assurance to all involved parties and organizations that all aspects of your document are valid. At the most fundamental level, security provides the confidence that if you find yourself in court and an electronic signature is disputed, you have met the legal criteria to prove the document is valid.

The security pillar of high-trust in eSign contracts ensures your document can withstand scrutiny and compliance with the strictest requirements across the globe.

When you use eSign software that provides high-trust like Nitro Sign Premium, you can walk into court knowing the document meets the highest possible standards in compliance as well as regulations such as the ESIGN Act.

If a document’s contents are altered after eSigning, the document is no longer valid or legally binding. Security features in eSign software should prevent any parties involved in the deal from changing the document after it’s signed. An extra level of security for organizations is an audit trail, which tracks and provides visibility into the journey of the document during the full signing process—from request to change to completion.

For example, an organization sends an eSign contract to a new hire with details of their employment. The Human Resources representative signs the document and sends it to the employee. The employee changes the salary on the contract so they are paid higher than noted in the original document.

Because security measures in the eSignature platform either prevent the document from being changed or send an alert that the document was changed, the contract is now invalid and the organization is not liable for the higher salary. The security pillar of High Trust prevents the employee from winning a court case where the employee tampered with the salary terms in the contract to get the organization to pay the higher salary.

To provide the security required for an electronic signature legal document to hold up in court, eSignature platforms should provide the following three security features:

Once a document is signed, it cannot be changed and remains legally valid. If brought to court, the organization needs to prove it was not altered. By placing a tamper-proof cryptographic seal on the document during the eSigning process, it cannot be manipulated after signing. If the seal is broken, the signers are notified and warned that the signatures have been voided.

For a document to be valid, the person represented as the signer must be the same person who physically executed the electronic signature. For example, an employee who signed a non-disclosure agreement violates the agreement by disclosing confidential information to a competitor. For the contract to hold up in court, the organization will need to prove that the employee in question signed the document. Evidence provides the proof that the employee’s identity was verified and ensures document integrity.

Identity verification requirements vary based on the location of the signers, with the EU having stricter regulations than the US. However, if one party is in the EU or one of the businesses is headquartered in the EU, the document may have to meet the strictest evidence requirement. By using an eSignature solution that offers flexibility to apply the most stringent requirements regardless of location, organizations can confidently do business across borders without worrying about the legality of electronic signatures on legal documents.

During the electronic signing process, the document is transmitted between signers, often through an eSign platform or email. However, personal and sensitive data in the documents, such as Social Security numbers, bank information or salary data, must be protected during the process through encryption.

To guarantee data security, organizations using eSignature processes must meet industry standards like TLS 1.2 for encryption in transit and AES256 for encryption at rest. Regardless of the location of the document during the process—in transit, stored on the cloud or stored on a network—the data must be protected at all times.

By using a Qualified Trust Service Provider eSigning partner and a secure platform, no one—not third parties or even the eSignature vendor—can access or see the content of the document.

Whether you are onboarding a vendor for your manufacturing company or you’re a financial institution having customers sign promissory notes, your organization needs all electronically signed contracts and documents to hold up in court.

Nitro helps you identify the level of security you need to meet specific business and regulatory requirements. When you need the highest level of trust, our eSign security features meet the most stringent requirements. And when documents need to be signed quickly, you can customize and automate workflows for a seamless process.

To learn more about Nitro’s commitment to security and compliance, visit our Trust Center or talk to our eSign experts about your unique needs.