Topic: Account Opening
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Are we permitted to retain copies of driver’s licenses in our files for deposit accounts? Should we be retaining these copies?
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Yes, we believe that you may retain copies of driver’s licenses in deposit account files, although it is not required. There may be some risk when retaining copies of driver’s licenses or other IDs in loan files or with loan applications, as we discuss below, but those risks do not apply to deposit account files.…
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A 501(c)(5) organization applied to open a checking account with us. They provided an EIN but did not provide any other documentation for the organization. They apparently are affiliated with a separate 501(c)(3) organization and offered to provide that organization’s articles of incorporation and bylaws. What documentation should we obtain from the 501(c)(5) before opening the account?
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We recommend collecting your customary account opening documentation from the 501(c)(5) organization. We do not recommend accepting documentation from the 501(c)(3) organization. Your bank should collect any documents prescribed by its policies and procedures when opening a non-profit entity account, which may include the 501(c)(5) organization’s articles of incorporation, bylaws, a corporate resolution authorizing the…
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What steps should we take when a customer is adjudicated disabled and appointed a plenary guardian over his estate and person? Do we need to reissue debit cards, get new signature cards, set up new online accounts, etc.? Also, if we establish new accounts in the name of the guardian, can we issue the disabled customer his own debit card to allow him to access the guardian’s new accounts?
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When a customer is appointed a guardian, we recommend closing the customer’s existing bank accounts and depositing the funds in a new account, titled as “[guardian’s name], guardian of the estate of [customer’s name].” In opening the new accounts, you should obtain new signature cards with the guardian’s signature, issue new debit cards to the…
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Does Illinois require corporations and limited liability companies to apply to use an assumed name? We have a corporate customer that has not submitted an application but has requested to present checks in an assumed name.
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Corporations and LLCs are required file an “application” with the Secretary of State before transacting business in Illinois under an assumed name (although the assumed name may be used as of the date the “application” is filed). Before permitting your customer to present checks made out to an assumed name, you may wish to request…
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Under the Customer Identification Program (CIP) requirements for account openings, can we accept a temporary Illinois ID with the expired, hole-punched ID? Or should we ask customers to come back with their permanent ID when received?
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We believe that the CIP regulations permit a bank to accept Illinois temporary paper IDs as valid identity documents, but your bank also may choose to not accept temporary paper IDs as a matter of policy. The CIP regulations require your bank to verify an individual’s identity after account opening. If verifying an individual’s…
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How should we set up ‘benefit’ accounts that are established for the benefit of someone else (such as raising money for a friend’s medical bills)? Should we require that these customers have trusts? What happens if the customer dies and there is a dispute over the account ownership?
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We recommend requesting that the individuals or groups opening these accounts obtain separate EINs for the accounts, rather than using an individual’s social security number. For example, the IRS EIN application expressly states that the following types of groups or organizations may obtain EINs, in addition to trusts: Block/Tenant Associations, Community or Volunteer Groups, Memorial…
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I seem to recall a speaker on the topic of Certifications of Trusts saying that if a trustee voluntarily provides a copy of a full trust instrument instead of submitting a Certification of Trust, we should document this fact. What type of documentation should we obtain in such cases?
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First, a clarification. If your bank requests that a trustee execute and submit a Certification of Trust form, and the trustee instead offers to provide the entire trust instrument, your bank is not required to accept the entire trust instrument. In fact, in most cases, accepting the entire trust instrument may not be desirable, since…
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Can we use a Certification of Trust form for opening both deposit and loan accounts with a trust?
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Yes, a Certification of Trust form may be used for opening both deposit accounts and loan accounts, as well as for all other dealings with a trustee that is a bank customer. Under Illinois law, a third party — such as your bank — may rely on a Certification of Trust in any instance “instead…
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Can a safe deposit box be leased by a trust? Can a safe deposit box be leased by a business?
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We are not aware of any law that prohibits trusts or business entities from leasing a safe deposit box. However, we note that safe deposit boxes are subject to Customer Identification Program (CIP) regulations, which require you to collect (at a minimum) the name, address and social security or other tax identification number of every…