Topic: Customer Identification Program (CIP)
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Are there any laws that apply to the forced reopening of accounts? When should we collect new signature cards from former customers?
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We believe that if a former customer of the bank is opening a new account, your Customer Identification Program (CIP) should treat that customer as a new customer. While the CIP regulations define “customer” to exclude any “person that has an existing account with the bank,” a customer who has closed all accounts with the…
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Do you have any suggestions for updating our account opening procedures for business and consumer accounts?
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As to consumer accounts, your policy must require that the following information be obtained from customers: (1) name, (2) date of birth (for individuals), (3) address (principal place of business, local office, or other physical location), and (4) taxpayer identification number. 31 CFR 1020.220(a)(2)(i). Your policy must then provide for verifying that information, either by…
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Are there any laws or regulations that require us to verify customer address changes (change of address notifications)?
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There are a few legal guideposts that apply to customers’ change of address requests, including general guidance on change of address requests and two regulations that apply only in specific instances, all of which are discussed below. Note that the guidance is not considered mandatory, but the regulations’ requirements are mandatory. Regulatory Guidance on Change…
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How can we CIP a memorial fund that does not have a TIN/EIN?
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You may want to ask that the memorial funds apply for Employer Identification Numbers (EINs) through the IRS (which does not charge a fee). It can be obtained using their online form or by phone (800-829-4933) (which results in a new EIN usually within an hour of application), or by fax or mail (can take…
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Are we required to collect social security numbers and addresses of the beneficiaries on payable on death accounts?
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We agree that the Customer Identification Program (CIP) regulations do not require you to obtain the social security number of payable on death (POD) beneficiaries. Under those rules, your CIP procedures must (at a minimum) collect and verify certain identifying information about your customers, including taxpayer identification numbers. 31 CFR 1020.220(a)(2). However, the term “customer”…
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What documentation should we require when a business incorporated in a foreign country (Turks and Caicos Islands) opens an account at the bank?
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The FFIEC’s BSA/AML Examination Manual includes a concise treatment of the risk factors and possible risk mitigation steps related to business entities. Business Entities (Domestic and Foreign)—Overview. For any foreign businesses, you will have to conduct individual risk assessments before opening the business account. The assessment should review “the domestic or international jurisdiction where the…
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What procedures should we follow in opening a deposit account for a foreign business (outside of the country)?
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The FFIEC’s BSA/AML Examination Manual includes a concise treatment of the risk factors and possible risk mitigation steps related to business entities. Business Entities (Domestic and Foreign)—Overview. While we would not disagree that foreign businesses are risky customers, the Manual could also help you to identify the least-risky foreign businesses. The Manual describes two kinds…
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What is the extent of a bank’s duty to determine whether an authorized signer has the authority to sign on behalf of a business?
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The Customer Identification Program (CIP) regulations provide specific guidance on developing policies for opening new corporate accounts. They require that you have a policy which requires you to collect the following information from customers: (1) name, (2) date of birth (for individuals), (3) address (principal place of business, local office, or other physical location), and…
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Do we need to collect taxpayer identification numbers from a joint account holder if the customer is not the primary owner of the account?
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We believe that a bank must obtain taxpayer identification numbers (TINs) when any customer opens an account, regardless of the customer’s status as to a joint account. Whether the bank needs to obtain a taxpayer identification number when an existing customer opens a new account is up to the bank. When a customer opens a…