HOAs & the USA Patriot Act
Answer by John Burnett, BOL Guru Guru Bio
Question: An issue has arisen at my bank concerning the need for a signatory on a homeowners association account to submit his social security number. My bank's BSA Officer believes that he must do so. I am not so sure. This individual has no personal accounts with our bank, but is listed as a signatory on two accounts dealing with homeowner's associations. The person in question refuses to give his social security number. How are HOAs classified for purposes of the USA Patriot Act? It's my understanding that the HOA is the owner of the account. I know that the signatory situation was in the proposed rules, but not the final ones. I would appreciate it if someone could provide me with some guidance.
Answer: It's true that signatories were dropped from the final CIP regulations, but banks have the option to include signatories in their CIP requirements, particularly in cases in which verifying the identity or existence of the customer, as defined in the regulation, is difficult. If your bank's CIP requires that you get ID information from a signatory, you've got to get it. Failing to do so becomes a citable event (failure to adhere to policy or procedure) in examinations.
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