BSA/AML Examiner School - Case Study Oct 2023

• A description of any document that was relied upon pursuant to this policy that clearly evidences the type of document and any identification number it may contain; • A description of the methods and results of any measures undertaken to verify the identity of a customer pursuant to this policy; and • A description of the resolution of any substantive discrepancy discovered when verifying the identifying information obtained. The Bank will retain all documentation related to the identity verification of customers for a period of five years after the account is closed. VIII. Customer Due Diligence and Enhanced Due Diligence Policy and Procedures Customer Due Diligence , or best described as "Know Your Customer", is a process of obtaining information at account opening and during the life of the account that helps the Bank in identifying potentially high risk customers. Once those customers are identified, they become subject to Enhanced Due Diligence. The goal of Customer Due Diligence is to identify high risk customers that may require Enhanced Due Diligence. In general, the Bank's Customer Due Diligence Program enables Bank personnel to predict with relative certainty the types of transactions in which a customer is likely to engage, and in turn assists the Bank in determining when transactions are potentially suspicious. The concept of customer due diligence begins with verifying the customer's identity and assessing the risks associated with that customer, including enhanced customer due diligence for high risk customers and ongoing due diligence of the customer base. In addition, these measures help the Bank to: 1. Comply with regulatory requirements. 2. Detect and reporting unusual or suspicious activity or transactions that potentially expose the Bank to financial loss, increased expenses or reputation risk; 3. Avoid criminal exposure from persons who use or attempt to use the Bank's products and services for illicit purposes; and 4. Adhere to safe and sound banking practices. Customer Due Diligence (CDD) - New Customers The concept of Customer Due Diligence begins with verifying the customer's identity and assessing the risk associated with that customer. CDD suggests the use of a questionnaire and/or multiple questions interview routine by the account officer opening the account. Your goal during the customer due diligence question interview is to find out if the customer is high risk, and if they are you must apply the Enhanced Due Diligence. Customer due diligence is an ongoing process, the account officers should take certain measures to ensure that customers information is always current and that the account is being monitored for unusual activity by the account officer and the BSA Department. Customer Due diligence begins with: 1. Identifying the customer by applying proper Customer identification procedures (CIP) - Name, physical address, DOB, TIN/SSN and obtaining the necessary documents specified in the CIP to verify this information. NOTE: For CIP, it is not sufficient to just obtain the required information in the CIF screen, you must also get proper documents (hardcopy) that proves that the information obtain from the customer is actually correct. 2. Next, you must obtain occupation, place of employment and contact information (telephone number, work number or business number, email addresses, etc.). Please make sure to complete all the CIF

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