BSA/AML Examiner School - Case Study Oct 2023

VII. Customer Identification Program Policy and Procedures The USA PATRIOT Act requires all banks to have a customer identification program (CIP) in place. The CIP rules require you obtain specific minimum information from new customers. The information must be verified to form a reasonable belief that the customer identity is known. The information may be verified using documents presented, this entails using a valid driver's license or passport. A non documentary verification may be used; this would be an independent means to confirm the customer information provided. The required information must be obtained from all new customers as well as all new accounts, this includes loans. Lenders must obtain identification documentation at loan closing from all borrowers. At minimum, the following must be obtained and verified: • Identifying information about a customer (i.e., Name, for individuals-date of birth, Physical address, and Identification Number such as TIN-SSN.) • A description of the documentary methods that the Bank used to identify the customer. (i.e., copy of Driver's license, State issued Identification Card, Passport, or any other document that has the customer's picture). • A description of the non-documentary methods and results of any measures that the Bank took to verify the identity of the customer. One method to verify this information is through a third-party vendor or credit reports agencies. Reverse directories may be used as well to verify addresses and send thank-you letters to customers. If it is believed that the customer is providing false information, the incident must be reported to the BSA officer or immediate supervisor for further action. This may include filing a suspicious activity report (SAR). • Customer Identification: Bank personnel should first refer to the Bank's CIP requirements. At a minimum, the Bank must obtain the following information to validate the true identity of an individual or entity seeking to open an account: o Name o For individuals, date of birth o Address:  Individual — residential or business street address  Individual who does not have a residential or business street address — an Army Post Office or Fleet Post Office box number, or the residential or business street address of next of kin or another contact individual o Entity - For persons other than individuals, (i.e., corporations, partnerships, and trusts) principal place of business and, if different, mailing address. o Identification Number:  U.S. Person - a U.S. taxpayer identification number (i.e.., social security number, individual taxpayer identification number, or employer identification number); or  Non-U.S. Person - one or more of the following: A taxpayer identification number; Passport number and country of issuance; Alien identification card number; Number and country of issuance of any other government issued document evidencing nationality or residence and bearing a photograph or similar safeguard. [A copy of the Primary Identification documents (passport, ID) must be obtained and scanned / copied for Imaging]

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